A Statement of Your Dues Investment in the Hospital Associations

Member Value Report

2016

1

A Year of Accomplishment

We are proud to share with you our accomplishments of 2016. This

report highlights many of the successful advocacy efforts that, together,

we achieved on behalf of California hospitals and health systems. With

the support of committed members and in collaboration with others,

CHA and the Regional Associations advocated with a common voice in

local, statewide and national policy discussions. For every $1 of your

dues paid in 2016, the Associations generated more than $220 in direct

value. The Hospital Association of San Diego and Imperial Counties’

regional accomplishments begin below.

CHA’s statewide and federal accomplishments begin on page 7.

Regional Successes of the Hospital Association of San Diego and

Imperial Counties

Access to Health Care

• Participated in numerous health care stakeholder groups and planning committees to protect, expand

and improve access to health care through programs including Medi-Cal, Covered California, the

Community Care Transitions Program, the Coordinated Care Initiative and Cal Medi-Connect.

• Coordinated hospital-based enrollment and eligibility efforts through the Hospital Outstation Services

(HOS) Program.

• Engaged the HOS Liaison Workgroup to discuss program challenges and represent those concerns to

County of San Diego officials.

• Advocated with County of San Diego officials for specific improvements, including better training of

county staff on new Affordable Care Act (ACA) eligibility requirements and improved capacity for

hospital staff to expedite review of critical cases.

Behavioral Health Services

• Focused on the San Diego Behavioral Health Continuum of Care Initiative and contributed to actions by

County Behavioral Health Services to address crisis services for both adults and children/adolescents.

• Advocacy efforts contributed to the County of San Diego’s $6 million mid-year budget enhancement to

expand existing behavioral health programs, as well as a 9.1 percent increase to psychiatric inpatient

2

provider reimbursement rates.

• Served on the County of San Diego Behavioral Health Advisory Board (BHAB) and worked to assure

the integrity of services throughout the county’s system of care in continued implementation of the

Mental Health Services Act Community Services and Support program.

• Chaired the BHAB Drug Medi-Cal Workgroup to better understand the Medi-Cal 2020 waiver and

addressing substance use disorders, as well as the draft San Diego County Implementation Plan and

potential impacts.

Business / Community Collaboration

• Recognized Imperial County Public Health Department Director Robin Hodgkin at the HASD&IC Annual

Meeting for her leadership on efforts to identify and address health care needs within Imperial County.

• Continued to strengthen relationships and opportunities to bring hospital and health care issues to the

forefront with local community and community-based organizations, chambers of commerce, business

coalitions and other key health care organizations through representation on the following boards,

committees and workgroups:

ACHE Regents Advisory Council

Accountable Communities of Health Workgroup

American Society of Quality – San Diego

Anthem Blue Cross Hospital Relations Committee

Association of California Nurse Leaders

Association of Perioperative Registered Nurses – San Diego Chapter

Association for Professionals in Infection Prevention and Epidemiology – San Diego & State

Chapters

Behavioral Health Continuum of Care Initiative

Behavioral Health Hospital Partners

Big Data Community Design Team

Business Alliance for Water

California Action Coalition Advisory Committee

California Association for Healthcare Quality

Children’s Initiative Board of Directors

Children’s Initiative Report Card Advisory Committee

City of San Diego Pure Water

Community Corrections Partnership

Community Health Improvement Partners Public Policy Committee

Community Paramedicine Pilot Projects

Coordinated Care Initiative/Cal MediConnect Advisory Committee

County of San Diego:

• Behavioral & Physical Health Collaboratives

• Behavioral Health Advisory Board

• Behavioral Health Services Community Engagement Forum

• Behavioral Health Services – Drug Medi-Cal Workgroup

3

• Department of Environmental Health Working Group: Safe Sharps Disposal

• Health Services Advisory Board

• Healthcare Integration Consolidated Team

• Healthy San Diego Behavioral Health Work Team

• Healthy San Diego Health & Housing Work Team

• Healthy San Diego Joint Consumer & Professional Advisory Committee

• Healthy San Diego Regional Center Work Group

• Integrative Health, Housing, & Human Services Advisory Council

• Inpatient Solutions Workgroup

• Long Term Care Integration Project

• Psychiatric Nurse Practitioners Workgroup

• Regional Continuum of Care Council & Governance Board

• Skilled Nursing Facility Disaster Preparedness Taskforce

• Social Services Advisory Board

• Unified Disaster Council

Downtown San Diego Partnership

East County Chamber of Commerce

Emergency Medical Care Committee

Emergency Medicine Oversight Commission

HealthImpact Advisory Committee

Health Services Capacity Issues Task Force

Health Workforce Initiative

Healthcare Laboratory Workforce Initiative

Hope San Diego Advisory Committee

Lanterman-Petris-Short Task Force and Work Group

Latino Coalition for a Healthy California

Live Well San Diego North County Community Leadership Team

March of Dimes Advisory Board San Diego-Imperial Division

Medical Lab Technicians Advisory Group

San Diegans for Healthcare Coverage Board

San Diego and Imperial Counties Perinatal Council

San Diego Coalition for Compassionate Care

San Diego County Medical Society GERM Commission

San Diego County Taxpayers Association Board and Subcommittee on Health and Community

Services

San Diego Covered California Collaborative

San Diego Health Connect Board

San Diego Healthcare Disaster Council

San Diego Organization of Healthcare Leaders

San Diego POLST ERegistry Workgroup

San Diego Prescription Drug Task Force

San Diego Psychiatric Law Society

4

San Diego Regional Chamber of Commerce (SDRCC) Board of Directors

SDRCC Health Committee

SDRCC Regional Jobs Strategy Partner Advisory Group

San Diego State University School of Public Health Advisory Board

San Diego Workforce Partnership Board

South East Regional Trauma Coordinating Committee

Whole Person Care Work Group

Whole Person Wellness Data Committee

Whole Person Wellness Management Committees

Capacity

• Assessed ED saturation and intensive care unit and medical/surgical bed status from the County of San

Diego QA-Net Quality Collector System to address capacity and offload issues during the winter

months.

• Revised regional hospital preparedness planning for significantly increased demand — such as during

influenza season or a disaster — through the Health Services Capacity Issues Task Force.

• Collaborated in planning and support for the eleventh annual San Diego Emergency Care Summit to

address capacity issues in both emergency departments and hospitals with a focus on the impact of

psychiatric patients.

Community Health Needs Assessment (CHNA)

• Completed the 2016 CHNA, which built on 2013 findings and delved deeper into the top identified

health needs.

• Engaged with more than 435 residents, direct service providers, leaders and experts to assess top

health needs and better understand the social inequities that prevent patients and clients from

improving their health and well-being.

Disaster Preparedness/Emergency Response

• Strengthened disaster preparedness and emergency response planning in local, state and national

committees and events, including the Hospital Preparedness Program Work Group, San Diego

Healthcare Disaster Council, County of San Diego Unified Disaster Council, California Annual

Statewide Disaster Drill, CHA EMS/Trauma Committee, Emergency Medical Care Committee and San

Diego County Medical Society Emergency Medical Oversight Commission.

Emergency/Trauma Services

• Engaged with the County of San Diego and other stakeholders to better understand the impact of

ambulance offload delays on our region’s emergency medical services system.

• Collaborated with the state and four other counties regionally on the South East Regional Trauma

Coordinating Committee to improve trauma systems of care and helped plan region-wide meetings.

• Participated in the implementation oversight of two community paramedicine pilot projects in San

5

Diego County with focus on addressing the needs of frequent 9-1-1 users of emergency department

services and alternative destination.

• Convened a panel of experts from outside our region at the 2016 HASD&IC Annual Meeting to share

perspectives on innovations in emergency medical services.

Health Equity

• Took the #123forEquity Pledge to Eliminate Health Disparities and encouraged member engagement.

• Convened a panel of experts from outside our region at the 2016 HASD&IC Annual Meeting to provide

groundbreaking approaches to promoting health equity.

Health Care Information Exchange

• Supported the continued growth and development of San Diego Health Connect as our region’s health

information exchange.

• Served on the San Diego Health Connect Board of Directors to provide a voice for the broader

community of hospitals and health systems.

Homelessness/Housing

• Represented hospitals in numerous public forums seeking solutions for homelessness and frequent

service users; as a member of Healthy San Diego’s Health & Housing Work Team, and through

engagement with the County of San Diego to develop whole person wellness programs.

• Represented hospitals on the San Diego Regional Continuum of Care Council to identify gaps in

homeless services, establish funding priorities and to pursue an overall systemic approach to

addressing homelessness.

• Recognized San Diego City Council Member Todd Gloria at the HASD&IC Annual Meeting for his

leadership in addressing homelessness and affordable housing issues to improve the health of our

communities.

Managed Care

• Participated in regional development and coordination of care delivery system changes through the

Coordinated Care Initiative/Cal MediConnect Advisory Committee with special focus on the needs of

dually eligible individuals.

• Engaged with Healthy San Diego to review health plans interested in joining the San Diego market and

provide feedback regarding those plans under the Department of Health Care Services Geographic

Managed Care (GMC) Request for Application (RFA) process.

Political and Public Advocacy

• Met with key candidates running for the County of San Diego Board of Supervisors and the San Diego

City Council to discuss issues of importance to hospitals.

• Supported CHA Political Action Committee (CHPAC) fundraising through HASD&IC board leadership,

hospital campaign assistance and coordination of a regional CHPAC President’s Club reception.

6

• Supported CHA state and federal advocacy programs through member communications, team building,

strategic planning and social media.

• Supported CHA’s advocacy efforts to express the impact of Section 603 on hospitals and patients and to

request flexibility in hospital outpatient department payment implementation; to thank state Assembly and

Senate members who supported the managed care organization tax package and elimination of the

distinct-part skilled-nursing facility clawback; to oppose AB 2743 (Eggman, D-Stockton), which would

have established a psychiatric bed registry; to oppose AB 2467 (Gomez, D-Los Angeles), which would

have mandated reporting of hospital executive compensation; to support Proposition 52, the Medi-Cal

Funding and Accountability Act; to support Proposition 55, the California Children’s Education and

Health Care Protection Act of 2016; and to support Proposition 56, the California Healthcare,

Research and Prevention Tobacco Tax Act of 2016.

• Supported CHA’s digital advocacy efforts to raise member awareness of the Our Health California

online community.

Quality and Patient Safety

• Continued to implement the Hospital Quality Institute’s (HQI) blueprint for advancing quality and patient

safety, and raised member awareness and engagement in HQI core activities.

• Directed regional activities in support of Patient Safety First…a California Partnership for Health, a

statewide partnership of the three hospital Regional Associations, National Health Foundation and

Anthem Blue Cross.

• Secured grant funding and produced a Hand Hygiene QI Project Video for infection preventionists’ use

and in support of International Infection Prevention Week.

• Secured grant funding to review and revise the 2014 Respiratory Monitoring of Patients Outside the

ICU Guidelines of Care Toolkit.

• Provided regional representation on the CHA Medication Safety Committee, CHA Certification and

Licensing Committee, HQI Board of Directors and HQI Hospital Quality Committee.

• Served as a member and Nominating Chair for the March of Dimes Advisory Board San Diego-Imperial

Division and as a member of the California March of Dimes Advisory Board.

• Served as staff advisor to the HQI Hospital Acquired Infection Workgroup.

• Convened regional quality and patient safety leaders and hosted CHPSO quarterly Safe Table Forums.

• Provided educational programs, speaker support, and scholarships to hospital members; obtained CME

and CEU credits for HASD&IC Annual Meeting.

• Supported workshop development and support for the HQI Annual Conference.

• Supported regional POLST eRegistry activities and POLST community education programs.

Workforce Issues

• Served as a regional “champion” through the Association of San Diego Chapter - California Nurse

Leaders (ACNL) to implement recommendations in the Institute of Medicine report, The Future of

Nursing: Leading Change, Advancing Health.

• Collaborated with the San Diego Workforce Partnership on efforts to expand nursing and allied health

programs in San Diego.

7

• Offered regional hospitals a voice on the CHA Workforce Committee, Allied Healthcare Workforce

Advisory Council, and Human Resources Committee to address workforce shortages and violence in

the work place. Elevated awareness regionally through the San Diego Chapter – ACNL and the San

Diego Healthcare Disaster Council.

The New Year

The core of our activities in 2017 will revolve around behavioral health, emergency services, Medi-Cal, and the

workforce. HASD&IC will continue to focus on addressing gaps within our region’s behavioral health services

continuum of care and other populations requiring special care services, including dually eligible individuals and

the homeless; completing Phase 2 of the 2016 Community Health Needs Assessment; supporting quality

improvements and a culture of safety within our hospitals and health systems; engaging members in post-

election health care policy changes; and educating newly-elected officials on issues of importance to hospitals

within our region and throughout California. Advocacy efforts will be driven by the vision of an optimally healthy

society with access to affordable, medically necessary, quality health care services for the communities of San

Diego and Imperial Counties.

State and Federal Successes of the California Hospital Association

Making the Hospital Fee Program Permanent

Voters in every county passed CHA-sponsored Proposition 52 — the Medi-Cal Funding and Accountability Act —

by a 70 percent majority in the November general election. The act will extend the existing hospital fee program,

which was slated to expire at the end of 2017. In addition to making the program permanent, passage of the act

also prohibits lawmakers from diverting these Medi-Cal dollars to pay for anything other than their intended

purpose. The fee program is estimated to bring in $4 billion annually for California hospitals and $1 billion for the

state. Net benefit to hospitals: $4 billion annually.

Continuing the 2014-16 Hospital Fee Program

CHA continued to drive implementation of the managed care portion of the 2014-16 hospital fee program. In

2016, the program brought in $3.6 billion for California hospitals; it is estimated to increase Medi-Cal payments to

hospitals by $10 billion over three years. Ensuring that the hospital fee and federal matching funds will be used

only for purposes described in current law, the program also guarantees that Medi-Cal rates to hospitals cannot

be cut from current levels. Net benefit to hospitals: $10 billion (2014-16).

Creating New Funding for Medi-Cal

Co-sponsored by CHA, newly passed Proposition 55 — the California Children’s Education and Health Care

Protection Act — will extend the Proposition 30 (2012) personal income tax on high wage earners from 2019 to

2031, directing significant funding to Medi-Cal for acute care in hospitals and preventive health care services.

Estimated to raise $5 billion to $11 billion annually in tax revenues, the majority of the act’s funding will be

8

directed to education; the balance will be allocated to the state’s Rainy Day Fund, the General Fund and Medi-

Cal. Approximately $1 billion annually — with a potential for up to $2 billion — could be available for hospitals and

physicians who provide critical, emergency, acute and preventive health care services to children and their

families. Net benefit to hospitals: $1 billion annually.

Defeating Efforts to Limit Executive Compensation

CHA was successful in blocking a proposed ballot initiative that would have limited hospital executive

compensation, avoiding a $60 million opposition campaign. Savings to hospitals: $60 million.

Eliminating Retroactive Payment Recoupment

On March 1, 2016, Gov. Brown signed legislation that eliminated the “clawback,” or retroactive recoupment of

reimbursement for services provided by hospital-based skilled-nursing facilities — representing a savings of $240

million for CHA member hospitals. The provision, which was part of bipartisan managed care organization

financing legislation passed by both houses of the Legislature, was the culmination of more than five years of

CHA advocacy. Savings to hospital-based skilled-nursing facilities: $240 million.

Improving Quality & Patient Safety

This year, the Hospital Quality Institute was selected to lead the California Hospital Engagement Network 2.0,

resulting in 1,618 harms to patients being avoided and savings of $9.2 million.

Advocating to Postpone Use of S-10 Data in DSH Methodology

In its inpatient prospective payment system final rule, the Centers for Medicare & Medicaid Services (CMS)

postponed its proposal to incorporate Worksheet S-10 data for use in calculating the distribution of the Medicare

disproportionate share hospital (DSH) uncompensated care dollars for federal fiscal year 2018. CHA urged CMS

not to finalize its proposal and instead ensure the accuracy of the uncompensated care data reported on

Worksheet S-10 through a hospital-specific data audit. CMS’ proposal would have resulted in a $3 billion shift in

Medicare disproportionate share hospital (DSH) funding across providers and states and would have harmed

states — like California — that stood to lose more than $485 million in Medicare DSH payments. Savings to hospitals: $485 million.

Reversing Unlawful Medicare Funding Cuts to Hospitals

In the 2017 inpatient prospective payment system final rule, CMS published two adjustments that will reverse the

effects of the 0.2 percent cut it unlawfully instituted when implementing the two-midnight policy in fiscal year (FY)

2014. Specifically, the CMS finalized a permanent adjustment of 0.2 percent to remove the cut prospectively for

FYs 2017 and onward. In addition, it finalized a temporary adjustment of 0.6 percent to address the retroactive

impacts of this cut for FYs 2014, 2015 and 2016. The change represents an important, hard-fought victory for

hospitals and health systems. Nationally, a projected $3.1 billion in Medicare funding will be returned to hospitals

over the next 10 years as a result of this change. Net benefit: $82 million to be returned to California hospitals in 2017.

9

Avoiding Unfunded Hospital Requirements

Blocking Enormous Collection Requirements

SB 1189 (Pan, D-Sacramento) would have required hospitals to store blood and urine samples from certain

patients — including those admitted with a life-threatening injury and those under the influence — and send those

specimens to the coroner if the patient died prior to discharge. If hospitals had been required to save each sample

for the duration of the admission, they would have needed space for over 18 million specimens every day.

Though the actual cost of the bill’s requirements is unknown, implementation of this unfunded mandate would

have cost hospitals significant time and resources.

Preventing a Mandated Patient Bed Registry

AB 2743 (Eggman, D-Stockton) would have imposed a new unfunded mandate on hospitals by creating a “real-

time” patient bed registry for inpatient psychiatric hospital bed openings. The mandate would have redirected

critical hospital staff to administrative functions and away from patient care. Real-time bed registries have been

tried in other states, both on a voluntary and mandated basis, have proven to be very difficult to implement and

have not shown significantly improved efficiencies. In addition to unknown costs to train staff and pay for access

to the registry, CHA estimated the labor costs to hospitals for keeping the registry updated in real time would have

been millions of dollars annually.

Averting Extraneous Notification Requirements

SB 1252 (Stone, R-Murietta) would have required hospitals to provide written notification to a patient in advance

of treatment if any of the physicians providing medical services to the patient were not contracted with the

patient’s health plan. In addition, hospitals would have been required to notify a patient of the net costs to the

patient for the medical procedure. Costs associated with this enormous new administrative burden would have been in the tens of millions of dollars.

Helping Physicians Lead Change

Now hosting its second cohort, the California Physician Leadership Program is a customized educational program

designed to challenge and grow physician leaders and medical executives. To date, over 50 physicians have

participated in this program, which leverages the University of Southern California’s top-rated Marshall School of

Business faculty, in partnership with the California hospital associations, to offer a unique balance of academic

and real-world subject matter experts.

Preventing Administrative and Legal Burdens

In addition to prohibiting numerous contract provisions between providers and health plans/insurers, SB 932

(Hernandez, D-Azusa) would have greatly expanded the Department of Managed Health Care’s (DMHC)

oversight by requiring any entity that intended to merge with, consolidate, acquire, purchase or control entity

health plan or risk-bearing organization to secure prior approval from DMHC. If this bill had been enacted, myriad

existing hospital contractual relationships would have been negatively affected, requiring expensive legal

expertise to resolve and likely resulting in reduced revenues. In addition, hospitals would have had to incur

substantial legal and other fees to obtain DMHC approval of new contractual relationships – or forgo those

relationships if DMHC withheld approval. Finally, hospitals would have to collect tens of millions of dollars directly

from their patients, because the hospitals would no longer have contracts with those patients’ health plans.

10

Impacting Changes to the Electronic Health Record Incentive Program

In response to advocacy by CHA, CMS made a number of changes to its electronic health record (EHR) incentive

program that will significantly reduce hospitals’ reporting burden. Among the changes, CMS finalized an EHR

reporting period of 90 continuous days for both 2016 and 2017 for all hospitals participating in the Medicare EHR

incentive program, as well as those eligible to participate in both the Medicare and Medicaid EHR incentive

programs. In addition, CMS eliminated objectives long opposed by CHA, clinical decision support and

computerized provider order entry, and reduced most Stage 3 measure thresholds required to achieve meaningful

use in 2017 and 2018 to the Modified Stage 2 levels.

Assisting with Seismic Compliance

CHA continued to help hospitals reach seismic compliance through ongoing interactions with the Office of

Statewide Health Planning and Development (OSHPD) and facilitating meetings between hospitals and OSHPD.

Adjustments resulted in savings in the millions of dollars.

Offering Reimbursement Data and Modeling

CHA DataSuite continued providing sophisticated modeling of revenue data, helping hospitals analyze

federal policy changes for budgeting, forecasting and decision-making.

Members-Only Access to Regulatory, Legal and Financial Expertise

• On-call Consultations

CHA staff serve as on-call experts on a variety of issues for hospitals and health systems. CHA

also serves as a link to regulators and their staff, assisting with problem-solving and direct

communications.

• Education and Reference Manuals

Developed exclusively for executives of California hospitals, CHA’s conferences, education

programs and manuals help explain ever-changing regulations and their impact on operations. In-person

programs provide a forum for members to exchange ideas and learn from colleagues.

• Legal Expertise

CHA’s legal department advocates vigorously on issues relevant to California hospitals.

• Timely Updates on Key Issues

CHA’s daily e-newsletter, CHA News, briefs members on key policy issues, legislation, regulations and

legal developments.