CEO Message

As 2019 Session Closes, Focus Turns Toward DC

With the legislative year coming to an end in Sacramento last week, and important signing decisions yet to be made by the Governor, our advocacy in Washington, D.C., is heating up.

Congress returned Sept. 9 facing a full legislative agenda. Because neither party wants another government shutdown, the House of Representatives passed a measure to keep funding flowing through Nov. 21. The Senate is expected to consider that legislation in the next few days.  

There’s also a full slate of health care issues up for debate in the coming months, so it was important that we took the opportunity last week, alongside nearly two dozen of California’s hospital CEOs, and with our partners at the American Hospital Association, to spend time with members of the California congressional delegation to discuss the issues most important to your hospitals and your patients. 

As we made the rounds on Capitol Hill, some common themes emerged: 

• Surprise billing: This issue is top of mind for Congress. Over the summer, one House committee reported legislation, the No Surprises Act; two others are expected to craft additional bills, and we could see a House floor vote sometime this fall. This week, the issue took on a new depth when the House announced an investigation into private equity firms that own physician-staffing companies, and whether they use out-of-network billing as an intentional strategy. In the meantime, we’ll keep reinforcing our message that hospitals support taking patients out of the middle when it comes to out-of-network bills, but we stand firmly against rate setting as part of the solution.

• Eliminating payment cuts to Medicaid disproportionate share hospitals (DSH): Set to take effect Oct. 1, cuts to Medicaid DSH hospitals will be unsustainable for many hospitals and could sever the safety net for your most vulnerable patients. We’re fighting hard on this one, urging that the cuts be eliminated or – at a minimum – delayed. The good news is that we have strong support in Congress, and a delay in the cuts for the first quarter of the 2020 fiscal year is part of the current House bill to temporarily fund the government. It’s good to be part of “must-pass” legislation, and we’ll keep pressing to get this done.

• Drug pricing: Reducing consumer drug prices remains a high priority for both Congress and the president. As we monitor those evolving efforts, we’re engaged in discussions with California congressional leaders to fully understand the various forms any pending legislation might take, as well as any impact on patients and hospitals.

As we continue to fight for policies that help you care for your patients and communities, last week’s meetings in the nation’s capital make clear that our greatest strength is in our unity, and when you lend your personal voice to the conversation, our message resonates. Thanks to all of our AHA regional policy board representatives who traveled to set the stage for our senators and representatives as they prepare to make decisions that will affect all of your hospitals.

— Carmela

Taking Stock and Looking Forward

In just a few hours, the state Legislature will officially wrap up its 2019 session. This was a particularly challenging year for our work to protect your ability to care for patients, as a new Democratic supermajority opened the door for several brazen policy proposals detrimental to hospitals. And the session saw a record number of bills (more than 3,000) introduced, so the pace was fast and furious. Factor in the uncertainty about how a new governor would respond to this environment, and you’ve got a volatile legislative mix for the past nine months.

Despite these dynamics, significant progress was made on several goals that support your work. This includes:

Expanding Coverage and Access

Through the state budget, advanced several board-approved priorities, including Medi-Cal coverage to undocumented adults age 19-25; insurance subsidies for families earning between 400 and 600% of the federal poverty level; and a state-level individual mandate for coverage.
Advanced a bill that codifies current training and data reporting practices to support reducing racial disparities in maternal health.
Secured passage of a bill that ensures insurance companies reimburse providers for care rendered during and after natural disasters.

Protection From Onerous Regulations

Halted momentum on a bill that, in an effort to ban surprise billing, would have set rates for insurance companies to pay hospitals for out-of-network emergency care. The bill will resurface in 2020, and CHA will continue to oppose rate regulation while supporting patient billing protections.
Sponsored a bill to offer relief from the state’s outdated 2030 hospital seismic standards. At our request, the bill has been extended into 2020 to help ensure uninterrupted care following a disaster.
Defeated a bill to give workers’ compensation benefits to hospital employees with certain illnesses and injuries unless the hospital could provide evidence the employee did not contract the illness or injury at work.
On a community benefits reporting bill, secured amendments so the bill no longer includes a percentage of Medicare reimbursement for the definition of charity care, limits reportable community benefits programs, or requires new regulations. 

Investments in Behavioral Health

Leveraging the behavioral health awareness work of Behavioral Health Action, a CHA co-led coalition, we helped secure hundreds of millions in investments in mental health and substance use disorder treatment.

A smaller number of bills didn’t go our way, but we’ll regroup heading into 2020 and try to resolve anything that hinders your ability to provide care. Here’s how they ended up:

Nurse staffing ratio penalties: Excessive penalties for noncompliance remain, but we secured amendments creating significant flexibility to meet ratios when encountering “unpredictable” and “uncontrollable” circumstances, and removing a prescriptive mandate on how hospitals should attempt to fill vacant spots.
Independent contractors: Fought but failed to defeat a bill that would prohibit hospitals from contracting with many health care professionals. This sweeping legislation affects dozens of employment sectors, and we plan join with them to consider future legislative and legal remedies.
Supplier diversity reporting: Secured important amendments that delay implementation until July 2021 and permit systems to report at the systemwide level. The bill remains problematic because it ignores the purchasing patterns of multi-state systems and hospitals that work with national group purchasing organizations.

Your phone calls, emails, and face-to-face visits with legislators were integral to our advocacy success this year. Thank you for your partnership and commitment. Gov. Newsom now has until Oct. 13 to sign or veto any bills — we’ll keep you apprised of those outcomes as they unfold.

— Carmela

The Values of Hospitals

Over the Labor Day weekend, The New York Times published a column critical of hospital spending. It called, ahead of the Democratic Primary debates, for elected officials and candidates to “address the elephant in the room and tell us how they plan to rein in hospital excesses.”

The data the author uses to form her call to action were carefully selected to support her position, and as is too often the case, fail to account for the myriad cost drivers beyond the control of hospital leaders, such as the high price of labor.

The American Hospital Association has already submitted a response to The New York Times, and has debunked some of the incorrect points in its blog.

We can argue data validity all day, and that work has its place. What’s more important, however, than simply correcting the record for this column – and hundreds of others like it in the past year – is that we take heed of a growing shift in how real people experience their hospital. Despite its many problems, the NYT column sadly does capture the sentiment of millions of Americans.

In June, NPR published “When Hospitals Sue for Unpaid Bills, It Can Be ‘Ruinous’ for Patients.” The piece offered multiple tales of the impact on patients and their families of garnished wages resulting from medical debt lawsuits.

Their stories are heartbreaking.

In the NPR story, the reporter interviewed Martin Makary, a surgeon and researcher at Johns Hopkins Medicine.

“Hospitals were built — mostly by churches — to be a safe haven for people regardless of one’s race, creed or ability to pay,” Markey said. “…They’re supposed to be community institutions.”

Markey is partially right when he says hospitals are supposed to be community institutions. There’s nothing “supposed” about it. You are community institutions.

You are there, 24/7, through all manner of emergencies, disasters, and more. You are economic pillars in your cities and counties. You wake up each day thinking about how to serve people better.

Even the NYT piece concedes: “…when their operations generate huge surpluses…they plow the money back into the system…build another cancer clinic…buy the newest scanner (whether it’s needed or not).”

It’s that last sentence that is troubling. Are we really at the point where we should think that building a cancer clinic or buying a scanner is a bad thing? These are investments that save and change lives. They are made solely with that purpose in mind.

It’s saddening that for some, the impact of not doing these things isn’t considered.

Which brings us back to the experience people have with their hospital and how they feel about that experience. There’s a joke about the airline industry here that is relevant. It goes something like this:

“There you are, 30,000 feet in the air, flying in an aluminum cylinder across the country to see your loved ones in just a few short hours, and all you do is complain that the movie selection is weak and the peanut bag is small. Where’s the appreciation for the miracle of flight itself?”

In 2019, this is our call to action as hospital leaders: to not only perform the daily medical miracles, but also to meet people where they are – so their hospital experience is one that matches your values of service, healing, and hope.

— Carmela

Protecting Patients by Protecting Health Care Professionals

One of the hottest bills in the Legislature right now is a proposal that would codify the precedent set by a California Supreme Court decision (the Dynamex decision), effectively prohibiting independent contractor status and requiring individuals to be employed instead. The struggle over Assembly Bill 5 (Gonzalez, D-San Diego) has been framed publicly as largely a contest between technology companies, like Uber and Lyft, and labor unions.

But there’s more to it than that. AB 5 and the Dynamex decision would deny thousands of health care professionals — including nurse practitioners, social workers, certified nurse anesthetists, and others — the choice to decide how and when they work. If that happens, their ability to serve patients when and how they’re needed would be impaired.

Likewise, hospitals would lose critical flexibility to respond to patients’ needs, and to solve complex workforce issues. Outside hospitals and within our communities, access to specialty care could also be diminished, as occupational and physical therapy, home health services, and some mental health services are often provided by independent contractors.

Our message to legislators has been that eliminating employment choice for health care professionals threatens access to care. Recognizing the impact of fresh voices in Sacramento, CHA has drawn on a set of new advocacy strategies:

A full-court press “lobby day,” where nearly 60 health care professionals whose jobs would be affected met with 30 different lawmakers’ offices
A letter-writing campaign for professionals affected by the bill, asking their legislators to support an amendment
An opinion editorial in a Sacramento-based publication widely read at the State Capitol

Heading into Labor Day weekend, we are grateful for the entire hospital workforce in California — the 97% who are traditionally employed, and the 3% who choose to be independent contractors. We stand as their advocates for policies that allow them to continue to provide incredible care to their communities.

Stay tuned, as the battle over AB 5 is likely to last through the end of session in mid-September. We may yet call on you to join us in urging state lawmakers to protect the way health care is delivered in California.

— Carmela

Connecting the Dots on Nurse Staffing Ratio Penalties

Earlier this year, we predicted a long and tough fight in the Legislature on nurse staffing ratio penalties. The battle isn’t over yet, but we’ve made some important headway in telling the hospital story – and, by extension, the patient story – to Sacramento lawmakers, all of which has resulted in important changes to the bill.

Senate Bill 227 (Leyva, D-Chino) would assess additional hospital penalties for those that violate staffing ratios. Throughout this year, we’ve not wavered in our stance that these penalties are duplicative and excessive. We continue to oppose the bill, but want you to be aware of several changes we’ve secured that significantly mitigate its impact on your hospitals.

CHA secured an amendment that reduces the penalties by half of what was introduced earlier this year.
We won an amendment that excludes from penalty times when hospitals are out of ratio due to “unforeseen and unpredictable” circumstances, restoring critical flexibility in managing the ratio requirements.
We successfully removed a provision that would have prescribed a rigid process for hospitals to follow in meeting required nurse staffing levels, going so far as to dictate that hospitals exhaust their list of “on-call” nurses before assigning a charge nurse.

With the help of letters, emails, visits, and calls to legislators from many of you, we’ve been successful in assuring lawmakers that everyone – hospitals, patients, and nurses – is better off when clinical professionals retain some autonomy when it comes to decisions about their own patients.

And you helped us educate legislators on the fact that not all hospitals have the same options for nurse coverage, especially in rural areas of the state, and that patient needs can shift minute-to-minute, where surge events can unexpectedly demand resources and staff in a way that doesn’t align with staffing ratios, exposing hospitals to the unjustified threat of violations.

CHA’s efforts on SB 227 reflect our partnership on multiple levels before lawmakers, regulators, and the public: connecting each dot necessary to ultimately tell the complete hospital story. We’ll press on in our fight against the financial penalties in SB 227 — and we’ll continue to support you in your mission of care by helping others more fully understand how you accomplish it.

— Carmela

Legislative Homestretch: Where We Stand

Lawmakers returned from their summer break this week to finish out the legislative session, which ends in four short (or long, depending on how you see it) weeks. By Sept. 13, bills need to be voted on and sent to the Governor, who then has 30 days to act on them.

As we enter the homestretch, here’s where we stand on some of this year’s top priorities:

On Immigration Status, Caregivers Don’t Care

Among the many tragedies born of the mass shooting in El Paso, Texas, which killed 22 and injured another two dozen, was the news that some victims might not have sought care at hospitals because of their immigration status.

This fear was so widespread that the West Texas wing of U.S. Customs and Border Protection tweeted: “We are not conducting enforcement operations at area hospitals, the family reunification center or shelters.”

Tragedy in Gilroy

“My son had his whole life to live and he was only six. That’s all I can say.” – Alberto Romero, father of Gilroy shooting victim Stephen Romero

“I have no words to describe this pain I’m feeling…We just want Keyla to be remembered as someone that is beautiful…She really cared a lot about other people. She loved animals. She had big dreams and aspirations and her life was cut short.” – Katiuska Pimentel Vargas, aunt of 13-year-old Gilroy shooting victim Keyla Salazar

Elevate, Educate, Innovate to Improve Behavioral Health Care

Last month, Tom Insel, MD, Gov. Newsom’s new special advisor on mental health care, shared with the Behavioral Health Action coalition some early ideas to change the trajectory of behavioral health care delivery in California. That Dr. Insel recognized coalition members as important to the process of transforming behavioral health is testament to the group’s hard and excellent work over the past year.

CHA co-founded Behavioral Health Action in 2018 with the National Alliance for Mental Illness, California, as an alliance of more than 50 organizations from health care, education, labor, law enforcement, local government, and business. Our first-of-its-kind coalition is focused on eliminating stigma and engaging lawmakers to develop solutions to the behavioral health challenges that so many Californians experience — for example:

More than 6 million Californians suffer from a mental illness.
Only one in three gets the help they need.
The number of adolescents suffering from depressive illnesses statewide continues to outpace the national rate.
Half of us will care for someone living with a mental health issue at some point in our lives.

The statistics are daunting, so the coalition hit the ground running last year with its mission to elevate the prominence of behavioral health so it gets the attention it needs, educate decision makers, and innovate the way we treat and support Californians in need — which includes getting the right care, in the right setting, at the right time.

In October, we held a one-on-one conversation with then-candidate Newsom, who pledged his commitment to turn California into a leader in improving the lives of people experiencing behavioral health challenges. When Dr. Insel spoke to the coalition last month, he continued to advance that conversation, explaining his view that we need both a shared understanding of the current problems and shared goals for tackling them.

Behavioral Health Action is working on just such a shared vision — an updated statewide model for behavioral health that will serve as a roadmap for the administration to use. As the model progresses, we’ll keep you updated.

In the meantime, we continue our work on many fronts: educating lawmakers about the importance of change, advocating for a budget that ensures everyone can get care when they need it, and strengthening our ties with the administration through a common sense of purpose.


Rate Setting, Front and Center

Surprise billing continues to garner attention from both federal and state lawmakers — and it’s a vitally important conversation. Patients should not be caught off guard by unexpected bills for out-of-network emergency care. Hospitals have said all along that when patients need emergency care, we support protecting them from surprise bills by limiting their out-of-network cost sharing to no more than the amount for in-network patients.