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Outgoing Cook County Health CEO Begins Strategic Discussion On Self-Pay For Medical Services

1/2/2020

Cook County Health Board Meeting - December 20, 2019

Following up on the 2020 budget deliberations and the very real issue of the increased cost for charity care, Dr. Shannon, presiding at his final board meeting before leaving the system, led a discussion on “self-pay” and how other major public hospitals across the country handle it.

For purposes of discussion, self-pay is used in place of charity care. There was a 17% increase in year-over-year charges from FY 2018 to 2019 from $158 million to $185 million. The percentage of self-pay was 1.2% in 2018 but dropped to .4% in 2019. The largest service increases are: Radiation Therapy [75%], Family Practice [50%], Gynecology [33%] and Surgery [29%].

Comparisons of NY Health & Hospitals; Jackson Memorial [N. Texas & Oklahoma]; Parkland [Dallas]; and Grady [Atlanta]; self-pay plans were passed to the Board and include:

Sliding scale fees based on Federal Poverty Levels
All or a portion of the patient responsibility paid in advance
Services covered limited to emergent [emergency]
Six months residency required to qualify for charity care

Dr. Shannon listed several strategic considerations:

Continuous improvement in revenue cycle process
Refine and update self-pay policies and procedures to include collection of co-pays from insured or payment for others [self-pay].
Refine and update policies on taking self-pay transfers from other healthcare facilities
Build-out point of service collections/payment capacity including:

1. Online payments as part of patient portal improvements
2. Kiosks with payment options
3. Training staff to collect/swipe cash or credit/debit cards
This would be a major change in policy for CCH as well as culture. Several board members questioned whether the County Commissioners and President would accept this concept. President Hammock responded that the System should provide an analysis and recommendations so that both it and the County elected officials have a base to work from including possibly deciding to provide more revenue to CCH to handle charity care.

Laurence Msall, President of the Civic Federation stated in public comments “The Civic Federation remains adamant in our support of this [volunteer] board…..” He also recommended that the System steer clear of initiatives that do not fit with its core strategy, but did not state what they might be.

Observer - Diane Edmundson Meeting Length: 2 ½ Hrs.

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Cook County Health CEO Jay Shannon Leaving at Year’s End

12/3/2019

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Cook County Health (CCH) Board of Directors Meeting
November 22, 2019

The vote by the Cook County Health Board to not renew CEO Shannon’s contract transpired after the Public portion of the Board meeting had adjourned and was reported by the media Friday afternoon November 22, 2019. Chicago Sun Times, Crain’s Chicago Business and WBEZ, NPR News Station reported that the Board named Debra Carey, deputy CEO, as Interim CEO beginning Jan. 1, 2020 while the Hospital System searches for a permanent replacement.

Board Discussion

CountyCare members 318,196 which is below budgeted numbers, resulted in decreased revenue and decreased expenses, net contribution of $144 million vs budgeted $269 million to CCH. Backlog of Medicaid applications of nearly 100,000 at the State Level is contributing to the lower enrollment.
Medicaid enrollment has decreased by 15% countywide, a trend seen Statewide as well as nationally, attributed to fewer “navigators” assisting in enrollment of Medicaid individuals under the PPACA explained Kiamos of CountyCare.
Net year end 2019 loss for CCH as a whole is projected at $156 million vs the budgeted loss of $180 million, which is a positive.
Charity Care is projected to total $377 million and an additional $167 million in bad debt, severely stressing CCH finances. CEO Shannon stated that this trend was unsustainable.
Shannon noted that patients who come for elective services such as expensive MRI/CT take advantage of the free care and he suggested that the Board should consider implementing partial pre-payment prior to the service which is the policy at other hospitals.
CEO Shannon reported that the CCH 2020 budget had been approved by the Cook County Board.
New Provident Hospital update, $240 million budget ($205 million in bonds and $35 million in furniture and fixtures from CCH); groundbreaking Fall 2020, fully open for business end of 2023; 42 med-surgical and 6 ICU beds (vs currently staffed 25 beds and average daily census 13)
CCH research indicates the Provident service area is in need of surgical and specialty services and has a better payer mix than Stroger Hospital
Director Thomas cautioned that the New Provident Hospital would be a difficult sell to the community as they had been told for years to use Stroger. He also warned that the University of Chicago would likely "dump" patients on Provident whenever they were on “bypass”.

Observed by: Susan Kern, MD Meeting Length: 3 hours

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Cook County Health Continues to Have Funding Challenges

10/25/2019

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Cook County Health (CCH) Board of Directors Meeting
October 25, 2019

Board Discussion:
CEO Dr. Jay Shannon summarized recent Cook County Health (CCH) positive developments:

The IL Health Facilities Board has approved the application for a new Provident Hospital;
The National Committee for Quality Assurance (NCQA) has given CountyCare high approval ratings;
The US Congress passed a continuing resolution through November 21, to continue the current $157m in “Disadvantaged Share Hospital” (DSH) funding to CCH, though, he cautioned, this agreement must be monitored.

But CCH faces serious funding challenges: it is $30m over budget in charity care despite $25m in new revenue this year. In 2020 CCH anticipates providing $590m in uncompensated care, for which the only designated funding sources are the federal DSH ($157m) and BIPA ($132m) allocations. The demand for charity care has grown by $100m since 2017. CCH is now providing about 60% of all charity care in Cook County. Of Stroger Hospital’s total patients, 47% are on Medicaid, 15% Medicare, 5% insured, and 35% uninsured. The possible solutions to the funding gap do not inspire hope: more state and federal funding, possibly County funding from a sales tax.

Committee Reports:

Human Resources: Of 757 vacancies filled, 541 were external; average 101 days to hire.
Managed Care: 320,177 CountyCare members as of 10/6/19, 31% of the total 1,012,425 managed care members in IL. 83% of CountyCare members choose to re-enroll in the program. Since January 2018 managed care enrollment has diminished by 180,000. An estimated 200,000 IL residents are eligible for Medicaid, but have not submitted applications. 96% of CountyCare claims are adjudicated within 30 days, but only 32% are paid within 30 days.
Quality and Patient Safety: 72% of patients are now willing to recommend the Stroger Hospital. The hospital’s readmission rate is currently 9.7%, vs. a 15% national average.
Finance: operating revenue is 23% below budget for 2019; the state is 2 months behind in payments. Primary care visits are up by 10%, specialty care up 6%, Emergency Room visits down 2%, deliveries up 5%.

Significant contract awards:

Cerner Corporation for software support - $191m for 5 years, $38.2m per year
Medline Industries for medical and surgical supplies - $70m for 36 months;
Paschen Ashlaur Joint Venture to construct Belmont-Cragin Health Center - $12m.

Observed by: Linda Christianson Meeting Length: 3 hours

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Cook County Health Board Transfers Millions from Special Purpose and Wage Funds to Cover External Provider Claims

10/4/2019

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Cook County Health (CCH) Board of Directors Meeting
September 27, 2019

What did the Board Decide:

Cook County Health (CCH), CEO Shannon explained that underestimation of external claims from non-CCH Network providers of the Managed Medicaid/CountyCare program exceeded the total appropriated dollars. Payment of these bills necessitates transfer of funds from other CCH budgeted items still showing a positive balance. Over $80M was transferred form special Purpose and Wage Funds to cover the claims.

The Board voted to purchase a renovated Blue Island building replacing the closing Oak Forest Clinic for $15.3 million, a savings over a 10 year $17.3 million lease.

Located at 12757 S. Western Ave. servicing the same population as Oak Forest Clinic/hospital, it will be a multi-disciplinary clinic including radiology, lab, specialty and primary care services.
Several Board Directors expressed concerns over the lack of parking and access as the nearby L station is slated to be shuttered. Administration pointed out that “L” station closing would open up their parking lot, and an adjacent building might be purchased for parking.

What else did the Board discuss or refer to committee?

New vendor using “Big Data” and algorithms identified $1.9 million in overpayments which CCH hopes to recoup.
Cultural Competency course & training program for CCH staff in development. Leadership are contributing components. Director Gugenheim urged that all levels of the organization be involved in its creation.
Dr. Mason, CEO of Cook County Dept. of Public Health reported adoption of the Good Food Purchasing Program (GFPP) by Chicago Public Schools; soon to extend to the County Sheriff’s Office and Juvenile Detention Center. It is a national organization and movement to bring ecologically positive changes to food sourcing including: 1) locally grown food 2) animal welfare and nutrition 3) environmental sustainability such as compostable cutlery and plates
Public Speaker, Laurie Cohen, of the Chicago Civic Federation called for greater transparency in presentation of CCH's finances. She alluded to the Board’s Sept. Finance Com. discussion & PowerPoint which states : CountyCare-CCH reimbursement rate has been adjusted to 100% of the Medicaid rate for current fiscal year. There was no explanation of how this impacted the system or budget.

CEO Shannon responded at the end of the meeting: Medicaid rate education would be considered. This response does not seem to address Ms. Cohen’s concerns that the consequences of various financial metric variations are not elaborated on to the public.

Observed by: Susan Kern, MD and Megan Kennedy Meeting Length: 2 hours and 45 minutes

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Cook County Health Board Approves Preliminary 2020 Budget

9/20/2019

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Cook County Health Board Meetings
August 30 and September 13, 2019

Special Meeting - September 13

With two abstentions, at a special meeting on September 13, 2019, the Board approved its 2020 preliminary budget for presentation to the County Board on September 26. The abstentions were in support of more revenue from the County for the Health System. CEO Shannon described it as “no doubt the most challenging budget” to prepare and meet since he became CEO in 2014. The $2,966 billion budget includes cuts to headcount in the form of eliminating 400+ vacancies in ambulatory care clinics and up to another 200 vacant positions in other areas.
Investments made over the last four years, primarily funded by the revenue brought in from its County Care Insurance Program, include substantially increased behavioral health and drug addiction services; a broader care management approach focusing on preventive care and housing/food insecurity; transportation services; a County authorized Direct Access Insurance Program* for the uninsured; and investment in new facilities, equipment and technology. This while absorbing a decrease in county funding from 25% in 2013 to 5% in 2020.
Expense drivers include Uncompensated Care which has risen almost 88% from $314 million after the ACA was enacted in 2014 to a projected $590 million in 2020, employee compensation, overtime, and rising prescription and medical supplies. Uncompensated Care includes charity care and bad debt. Dr. Shannon stated there is “no question other providers are redirecting charity care to CCH” and that the system cannot cut its way [expenses] out of the increase cost of charity care.
For more information on the preliminary 2020 budget CLICK HERE:

* Direct Access is a subset of Charity Care and county residents qualify based on income. About 50% of charity care costs is attributed to the Direct Access Program.

Committee Reports from August 30, 2019 Board Meeting:

Human Resources: 7,200 total positions, 836 positions in process, 628 positions filled year to date. Average days to hire 102. Average vacancies per year 1100 to 1200.
Managed Care: CountyCare membership trending up to 318,676. Cook County continues to have a 31.6% market share, which is the largest among the seven Managed Care Operations in the county. However, when Meridian’s merger is completed at the end of 2019, it will pass CCH in market share. While state approval time for Medicaid applications is improving, there is still a 100,000 backlog to get initial application and redetermination applications approved. Illinois is looking at outside contracting for help in reducing the backlog.
Finance: The 2020 preliminary budget was pulled from the August 23 agenda to be further worked on and presented at the August 30 board meeting. See above September 13 board meeting text, as presentations and discussion at the August 30 meeting were similar except there was no vote.
Requests: Chairman Hammock asked for a longitudinal chart on monthly memberships in the Health System’s County Care Insurance Program. He did not specify how far to go back.

Other information of note:

The Deloitte forensic audit of the Health System’s County Care financials and the System’s overall method of accounting was completed, and on September 4, 2019, CEO Shannon submitted the Deloitte report and the Health Systems response to the highly critical Inspector General (IG) Report of June 26, 2019. CCH Executive Management stood behind its initial public response that the IG got it wrong and provided a 15 page rebuttal. It also claimed in public comments that the Deloitte report mainly agrees with CCH. The County board will review both the Deloitte report and the Health System’s response at its September 26, 2019 meeting. CCH Management will attend as likely will the Cook County Inspector General.

Observer - Diane Edmundson Meeting Length: 4 hours total

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Cook County Health Approves Preliminary 2020 Strategic Plan

7/30/2019

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Cook County Health (CCH) Board of Directors Meeting - July 26, 2019

Board Decisions:
The board unanimously approved the preliminary 2020 strategic plan, which will be available for public input later this summer and presented to the Cook County Board in September.
The plan calls for:

Increased surgeries, emergency visits, primary care, specialty care, and deliveries;
5% cost savings; and
Sustaining CountyCare membership,

Challenges to the system include:

Salary increases,
Increased cost of equipment and supplies;
Revenue loss in CountyCare;
Consolidation of hospitals
A $52m pension requirement.

CEO Dr. Jay Shannon pointed out that CCH needs to attract and retain paying patients When CCH loses CountyCare patients, there is a 53% chance they will present for charity care, which consumes 25% of CCH revenue.

Committee Reports.

Human Resources: 7,265 total positions, 1,151 vacancies, 830 positions in process, 364 external positions filled. Hiring for coders and billers difficult; not enough qualified candidates.
Managed Care: CountyCare membership 316,730 as of May 2019, 31.6% of market share. Home visits to high risk patients to encourage them to use CountyCare. Commissioner Sidney expressed concern that patients were being “auto-assigned” to health care plans without patient input.
Quality and Patient Safety: CCH has a 16% readmission rate (near national average), attributed to hypertension and kidney disease; 8 falls with injury per month average; no hospital acquired conditions in last 3 months, but some infections. 74% willing to recommend Provident, 69% to recommend Stroger.
Finance: Budget 23% below target due to increased (1) charity care, (2) clinical activity and (3) pharmacy costs. “We need to be better compensated for care to the uninsured,” CEO Shannon commented. Finance Chair Robert Reiter pointed out that CCH provides half of the charity care countywide; other hospitals are providing less. Commissioner Mike Koetting emphasized the “centrality of making sure we are the provider of choice; otherwise the percentage of charity care will continue to grow.” 45% of CCH patients are now uninsured. 51% of patients identify as African American; 32% identify as Latino.

CCH Board Chair Hill Hammock announced that the Deloitte accounting firm will examine CCH’s financial books and accounting principles, with a response from CCH by the end of August.

Observed by: Linda Christianson Meeting Length: 3 hours

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Outgoing Cook County Health CEO Begins Strategic Discussion On Self-Pay For Medical Services

Cook County Health CEO Jay Shannon Leaving at Year’s End

Cook County Health Continues to Have Funding Challenges

Cook County Health Board Transfers Millions from Special Purpose and Wage Funds to Cover External Provider Claims

Cook County Health Board Approves Preliminary 2020 Budget

Cook County Health Approves Preliminary 2020 Strategic Plan

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