Rossi, Trammel, Pilkington Receive AHA Awards

The Arkansas Hospital Association's Distinguished Service Award was presented October 14 to Amy Rossi of Little Rock and Dick Trammel of Rogers. Rossi, a licensed social worker, is executive director of Arkansas Advocates for Children and Families, a state-based nonprofit child advocacy organization. According to Ben Owens, president of St. Bernards Regional Medical Center in Jonesboro, "Amy simply gets results." Recognized as one of the state's best resources on issues affecting children and families, Governor Mike Huckabee credited her for laying the groundwork for the ARKids First program to expand healthcare coverage for uninsured children. Rossi also devotes time to many community activities.

Dick Trammel, a charter member of the board of Northwest Arkansas Radiation Therapy Institute in Springdale, "is a loyal person who has supported NARTI with tenacious intensity, with devotion and concern, ... to ensure that NARTI continues to deliver the finest possible quality of care to the community," said Eddie Bradford, executive director of NARTI. Trammel is the only charter board member still active on the hospital's board today. He has served as chairman of every major board committee, actively participated in the annual Phillips Classic, and continues his support for fund-raising through the Cancer Challenge, the major charitable event for support of all cancer programs in Northwest Arkansas. In addition to his healthcare involvement, Trammel also generously shares his talents with numerous community activities.

Albert Pilkington III, administrator of Mena Medical Center, was also named recipient of the C. E. Melville Young Administrator of the Year Award. The award is given each year by the Arkansas Health Executives Forum, and was presented by James Summersett III, president and CEO of Conway Regional Medical Center and Arkansas' regent for the American College of Healthcare Executives.

AHA Offers New Web Site

The Arkansas Hospital Association's new Internet web site, www.arkhospitals.org, will be accessible to the membership in early 1998. We hope you will visit the site, available 24-hours a day, to study products and services offered by AHA Services; read current and archived AHA publications; scan late-breaking hospital related news bulletins; check out the association calendar; register for educational seminars and meetings; link to all other state and national hospital and healthcare web sites; and, communicate with AHA staff via e-mail.

UAMS Research on Alzheimers

Researchers for the University of Arkansas for Medical Sciences (UAMS) have authored a study showing that a protein called apolipoprotein E3, or APOE-E3, plays an important role in suppressing the inflammation of the brain associated with Alzheimer's Disease. Steve Barger, a University of Arkansas at Little Rock assistant professor of geriatrics and anatomy, and a co-author of the study, said the discovery could lead to clinical studies within two years.

A key finding of the study is that a protein called Amyloid Precursor Protein (APP) may stimulate the inflammation response in the brain's microglia cells, which normally help provide an immune response when the body is under attack from infection, according to Barger. As APP attaches itself to the microglia, it causes the cells to swell and emit chemicals intended to fight infection. A growing number of scientists believe these chemical emissions cause an inflammation that never subsides and spreads through much of the brain. APOE-E3 seems to dampen the effect of APP, which suppresses the microglia cells. Barger hopes the discovery will lead to further research on the interactions of APP and APOE-E3. He says the trick will be to develop a drug that only suppresses the undesirable effects of APP, which also performs a variety of other functions essential to the brain.

Rural Hospital Help

The Balanced Budget Act of 1997 includes two measures that may increase Medicare payments for some rural hospitals. The two measures involve Medicare dependent hospitals and a newly defined classification for Critical Access Hospitals.

Under the first provision, Congress reinstated a payment program for Medicare-dependent small rural hospitals that expired three years ago. It allows small rural hospitals--having 100 beds or less and a Medicare patient load of at least 60% of all patient days--to receive Medicare payments similar to sole community hospitals, which are paid on a modified cost basis. The renewed program, which could affect almost 370 rural hospitals nationwide, including several in Arkansas, should funnel about $200 million in added Medicare payments to those facilities between now and its proposed expiration date, October 1, 2001.

The law also set aside about $25 million for implementation of a new Critical Access Hospital (CAH) program that may cover as many as 200 hospitals. To qualify, hospitals must have no more than 15 beds; must be more than 35 miles from any other hospital (15 miles in mountainous areas); and must provide 24-hour emergency services. The program replaces Medicare's Essential Access Community Hospital and Rural Primary Care Hospital programs which had operated in seven states. Hospitals designated as CAH's will be reimbursed by Medicare on the basis of their reasonable costs.

American Hospital Association Celebrates Centennial

Arkansas hospital CEOs, administrators and trustees will join others from across the nation to celebrate the American Hospital Association's Centennial at the 1998 Annual Membership Meeting, January 31-February 3 in Washington, DC. The celebration will begin with an elegant dinner featuring entertainer Maureen McGovern and others on January 31 at the Washington Hilton Hotel.

Attendees will hear presentations from speakers such as Elizabeth Dole, president of the American Red Cross; U.S. Rep. Bill Thomas (R-CA), chairman of the House Ways and Means Committee's health panel; Barry Bader, an expert in healthcare governance; and Judy Woodruff, CNN correspondent, will moderate the annual "congressional crossfire."

Arkansans will also visit with Arkansas' congressional delegation and honor the congressional aides with an appreciation dinner.

Transfer Questions and Concerns

Below is a list of commonly asked questions about the Balanced Budget Act's Transfer Provisions on Medicare. This list was provided by the American Hospital Association.

-- What is current policy?

Medicare patients that are sent from one acute care hospital to another acute care hospital are defined as transfer cases. These cases are paid less than the full DRG rate if the patient had a shorter inpatient stay than average.

-- What change was made in the definition?

The Balanced Budget Act (BBA) of 1997 expanded the definition of a transfer to include patients sent from an acute care hospital to any post acute setting--rehabilitation, psychiatric, or skilled nursing facility, or a home health agency. (Swing beds are not included.) The change is limited to 10 diagnosis-related groups (DRGs) with a high use of post-discharge services--described as "qualified discharges."

-- Which DRGs will be picked by the Secretary as qualified discharges?

We don't know at this time. Based on analyses by the Prospective Payment Assessment Commission, we might expect to see stroke and hip replacements picked as qualified discharges. A list of DRGs likely to be assessed by the Secretary as candidates is shown to the right.

-- When will this change take place?

According to law, the expansion in the definition of transfers will be implemented for discharges on or after October 1, 1998. We expect the change in policy will be discussed in next year's PPS rule.

-- How will these cases be paid?

Transfer cases are paid a per diem rate up to the full PPS rate. Since the hospital gets paid twice the per diem for the first day, full payment is achieved when the stay is one day less than average. For example, if a patient stayed nine days where the average stay was 10 days, the hospital would receive the full payment. However, if a patient stayed four days where the average stay was 10 days, the hospital would receive 5/10ths or half the full DRG rate for that case.

Under the BBA, the Secretary has the discretion to modify the payment for qualified discharges for which a substantial portion of the costs of care are incurred in the early days of the inpatient stay. Payment for these cases would be 50% of the full DRG rate, plus 50% of the transfer payment. For example, if a patient stayed four days where the average stay was 10 days, the hospital would receive 50% of the full DRG plus 25% (50% of 5/10ths) of the full DRG for the transfer payment portion. In total, the hospital would receive 75% of the full DRG for that case.

-- What problems does the American Hospital Association foresee in implementation?

To implement the expansion of transfers, hospitals must code "transfer" or "discharge" each time a bill is submitted. However, beneficiaries are free in the Medicare program to choose post-acute services, independent of the hospital's decision. Thus, hospitals may not know when a "transfer" to a post-acute setting occurs after discharge. Our concern is that if the code on the bill is wrong, it would be considered fraud.

DRGs With Highest Proportion of Beneficiaries

Using Post-Acute Care Providers, Fiscal Year 1994

Note: DRGs were assigned during PPS hospital stay. Patients who died in the hospital and DRGs with fewer than 1,000 discharges were excluded. DRG = diagnosis-related group.

CC = complication and/or comorbidity. TIA = transient ischemic attack.

Source: ProPAC analysis of MedPAR and home health claims data from the Health Care Financing Administration.