Universal Health Care Is Possible -- With No Premiums or Deductibles

Universal Health Care Is Possible -- With No Premiums or Deductibles

Imagine a proposal for health care reform that guarantees free, high-quality health care for all Americans. No premiums. No deductibles. In this plan, the government insists that all insurers offer the same comprehensive benefits to everyone, including: office and home visits, hospitalization, preventive screening tests, prescription drugs, some dental care, inpatient and outpatient mental health care, and physical and occupational therapy.

If this sounds too fantastic to be true, you need to read Healthcare, Guaranteed: A Simple, Secure Solution for America by Dr. Ezekiel Emanuel. He offers a bold, refreshing plan for health care in America. The beauty of his proposal is four-fold: It faces up to the fact that reform won't pay for itself, and it offers a funding mechanism that is fair and efficient and could deliver high-quality care nationwide. It regulates insurers, forcing them to concentrate on quality. Finally, and perhaps most importantly, this plan insulates our health care system from the lobbyists who, today, have far too much control over our health care system.

MAR Funding Underwriting Benefits

Aside from the many benefits already discussed throughout these blogs, still more benefits can be found in the unique and precise manner in which Sun Capital HealthCare, Inc. (SCH) underwrites a prospective client. One would certainly ask "how can underwriting benefit my medical business/practice?"

SCH's underwriting/audit staff performs its duties for the benefit of SCH in order to determine, net collectible amount per code and carrier and to affirm strong and consistent systems and controls used by the applicant. Although SCH receives the voluminous results of each audit performed, the data and results determined can be of extreme value to the medical provider. SCH's staff has experience in finance, accounting, coding, medical compliance and business administration. So often, the audit determines that better front office controls are needed to affirm ample and proper insurance coverage. The practitioner or business owner quite often is not aware of these deficits and, following the SCH audit, will take corrective action to remediate such situations.

During past audits the SCH team has found that some in-network reimbursements have been paid at lower dollar amounts for no reason. Carriers sometimes make these errors and do not follow their own fee schedule. SCH has recovered literally tens of thousands of dollars in adjustments for the medical professional by just auditing in-network reimbursements. Once again, this is not SCH's primary business model; it is not a recovery company.

The underwriting process in most cases is free of charge with no up-front fees. The medical professional gets a free x-ray of his/her business and can gain by this process alone. Reimbursement amounts brought to the practitioner by SCH, may actually provide that business owner the ability to decline certain procedures due to low reimbursements by all carriers.

MAR Funding has many benefits, but even the process of qualifying can provide medical practitioners/owners with invaluable information and insight.

Current Economy's Trickle Down Effect On Hospitals' Finances

Rising health insurance deductibles, soaring drug co-payments and explosive gas prices are all having a trickle-down effect on hospitals' financial positions across the U.S.

The trend has meant more patients delaying procedures and preventive care, more uninsured patients, and less reliable payment methods - all of which can put a squeeze on hospital finances.

The current trends may represent a fundamental shift in health care and hospitals will have to come up with ways to plug revenue drains and generate more income.

Medical Accounts Receivable (MAR) Funding can be utilized by hospitals and healthcare providers as a way to increase revenue and reduce costs. It can be used to accelerate cash flow by turning a non-performing asset, accounts receivable, into working capital. MAR Funding also allows healthcare providers/suppliers to take advantage of cash discounts and/or quantity discounts as well as other cost savings from vendors. It is often used to fund various management tools which can reduce overall costs of operations.

A HEALTHY BALANCE SHEET

Jeff Lutz, in the July 23, 2008 issue of H&HN magazine, discusses the Detroit healthcare market in a lousy economy. He discusses several lessons for healthcare from the events that are occuring in his hometown market due to the bad economy.

He does, however, strike an optimistic note at the end when he notes "...those with strong balance sheets are picking up market share and investing in physicians, services and technologies for the future."

Once again, it seems that the mantra for success in the healthcare business, whether in good times or bad, is having a healthy balance sheet. The best prescription for being healthy is to effectively use all the tools available and find the best combination that works for the provider's specific situation. One of those tools should be Medical Accounts Receivable {MAR} funding. It is a debt-free method to fund working capital and accelerate your cash flow. The flexiblity of a Sun Capital HealthCare MAR Funding program allows you to determine the dosage that works best for you when in combination with the other financing options you have.

A healthy balance sheet gives the healthcare executive the maximum flexibility for finding growth and profitability. And the Sun Capital MAR funding program can be customized to your specific needs.

World's Largest Collaborative Online Encyclopedia of Medicine and Health

World's Largest Collaborative Online Encyclopedia of Medicine and Health.


The Medpedia Project announced the formation of the world's largest collaborative online encyclopedia of medicine called Medpedia. Physicians, medical schools, hospitals, health organizations and public health professionals are now volunteering to collaboratively build the most comprehensive medical clearinghouse in the world for information about health, medicine and the body. This free public site will officially launch at the end of 2008, and a preview site becomes available today at http://www.medpedia.com/.

The Medpedia Project is an extraordinary global effort to collect, organize and make understandable, the world’s best information about health, medicine and the body and make it freely available on the website Medpedia.com. Physicians, health organizations, medical schools, hospitals, health professionals, and dedicated individuals are coming together to build the most comprehensive medical resource in the world that will benefit millions of people every year.

Medicare Pays Millions to Fraudulent Billers

A recent congressional investigation discovered that CMS paid nearly 500,000 fraudulent claims. Between 2000 and 2007, CMS "reimbursed" numerous medical equipment providers who used dead doctors' Medicare numbers to write prescriptions and order equipment.

The Senate Permanent Subcommittee on Investigations estimates that somewhere between $60 million and $92 million was lost to fraud.

Per a statement made by Herb B. Kuhn, CMS's deputy director, CMS has taken steps to implement policy changes and new procedures so that invalid or inactive PIN's are not used by unscrupulous DME providers in the future.

COST vs. VALUE

I listened to an interesting discussion on public radio this morning while in my car. Ths issue was the state of cancer research and treatment. One of the comments made by a doctor was that too often when discussing alternative treatment plans with patients, the medical professionals fail to adequately discuss the likely outcomes. Costs and side effects are readily understood and communicated. However, since the various therapies are not curative but rather life extending, it is a difficult decision to make when you consider the "value" of adding 3 months to a life when the "cost" of the treatment can financially destroy a family.


Cost versus value...a balancing act.

Cost versus value is also a balancing consideration at the provider level, especially when looking at alternative financial solutions to the fiscal issues facing hospitals, including equity, debt and Medical A/R funding. Equity solutions are not always available, nor are they available to all providers [e.g. non profits]. Debt financing solutions can be less costly than A/R funding solutions, but they aren't necessarily the best "value" solution when the "hidden costs" of debt or bank financing are added in. The most effective financial solutions for healthcare financing should involve a combination of these three financial tools. By having a balanced financial portfolio, including debt financing, Medical Accounts Receivable [MAR] funding programs from a company like Sun Capital HealthCare Inc. , and equity financing where applicable, the healthcare provider will be well positioned for having a healthy balance sheet and financial results.

Ratings Drop as Hospitals Bleed from Bottom Line

Per recent reports, bond ratings for hospitals have dropped significantly.

In many of these cases, the reasons for the downgrades were similar - big operating losses in fiscal 2007, declining patient volume, and concerns about the hospitals' ability to turn themselves around.

Medical Accounts Receivable (MAR) funding presents an opportunity for hospitals and other healthcare providers to protect and maintain bond ratings. MAR Funding boosts liquidity which makes for a healthier balance sheet.

A Cardiology Practice Benefits From MAR Funding

A cardiology practice consisting of 5 physicians contacted Sun Capital HealthCare (SCH) to see if we had any thoughts on how to maintain their income in an environment of decreasing reimbursements and higher operational costs. Our suggestion was simple, they should provide other services and/or procedures during the same working day in order to increase revenue.

As a cardiology practice, over 75% of their patients get annual stress testing, which the practice did not perform. They used a local stress testing lab. Wouldn't revenue geometrically increase if they provided that procedure and billed the full fee rather receiving a small referral fee? Unfortunately, there was no additional equity available to build such an addition.

SCH suggested the use of the group's laziest asset, their existing accounts receivable. Close to one million dollars in A/R was sitting on their balance sheet doing nothing. SCH opened the account and purchased the existing A/R to provide the large infusion to set up the lab.

On a daily basis thereafter, the cardiology group sold their daily billing to SCH in order to level out cash flow and eliminate expense pressures. The result, almost double the existing income was created simply by using the laziest asset in any business, accounts receivable.

HME Providers Forms Vendor Alliance With Sun Capital HealthCare

Sun Capital HealthCare, Inc (SCH) has been selected to join HME Providers' vendor alliance program as a preferred provider of Medical Accounts Receivable (MAR) Funding.

Members of HME Providers will be able to benefit from SCH's customized service which serves as a debt-free funding solution for healthcare companies. HME/DME providers can use MAR Funding as a source of working capital to create a monthly cash flow, meet payroll and overhead, reduce debt and cut costs by using cash discounts, as well as for a variety of other funding needs.

HME Providers currently offers more than a dozen vendor business-to-business alliances and passes all special program savings onto their members.

How MAR Funding Has Worked For Various Providers

A quick case study of a very satisfied Sun Capital HealthCare (SCH) client can provide you with a "real life" example of how MAR Funding can be of use in your medical practice, business or facility.

Our most recent success story starts with a group of "walk-in" clinics in the southwest. Cash flow and growth challenges brought the practice manager to SCH for solutions. After evaluating the practice and determination of their net realizable fees, SCH advanced on the practices's existing bucket of receivables providing a "cash infusion" for the purchase of new, and updating of existing facilities.

Cash flow was previously so unpredictable that bank lines were used and unfortunately could not be paid back in time for the next payroll need. The bank called the line and the pressure was unbearable.

SCH paid off the bank line, and provided the level, predictable and useful cash flow needed to make payroll, pay for supplies and overhead. SCH is proud to be an important part of the growth and survival of this profitable practice. Read another SCH success story.

Rethinking Patient Flow

Joe Flower wrote a very interesting article "Change The Model" in the July 9, 2008 on-line issue of H&HN Magazine, discussing the increasingly difficult climate for hospital survival. In it, he notes that while capital is necessary to a provider's growth and success, "the most important input a hospital needs is patients". And the critical factor in patient flow is the primary care physician.

However, he notes the decline in primary care doctors, to the point that in 2005, only 8% of medical school graduates were going into family practice. If the hospital model is dependent on patient flow coming from primary care physicians [or from specialists who themselves have been referred to by primary care physicians], then this shrinking of primary care doctors necessitates a rethinking of the hospital model and where and how the flow of patients can be generated. Flower's solution is that hospitals must increasingly take on the role of primary care providers and he suggests a number of ways to do this.

His solutions, however, seem to fall short of really addressing the issue of increasing the supply of primary care physicians. Companies like Sun Capital HealthCare, Inc. can provide the financial means and working capital hospitals need, but for the healthcare system to survive, the need to attract more primary care doctors into the system must be addressed. Financial incentives, medical school curriculums, geographical considerations, electronic records/remote capabilities, etc. all must be considered when looking at redefining the hospital model and reinvigorating a healthy healthcare system that is referral based. Let's bring back "housecalls" to the healthcare system.

Hospital Costs Vary While Quality is Indiscernable

The Herald Tribune article explains how to evaluate a hospital for its quality and cost of its services.

An appendix, the mysterious little organ in the abdomen, is much the same in everyone. So why would it cost, on average, $61,737 to remove it at one hospital, and $17,437 at another? The phenomenon goes beyond surgery, even to common ailments that virtually every hospital sees.

Hospitals base those charges on their internal costs -- the price for bandages, the salaries of nurses, and so on -- and on what they think their local market can support, said David Verinder, chief financial officer at Sarasota Memorial Hospital.

Hospital Shelves Plans to Build Teaching Hospital

Boca Raton Community Hospital has backed out of building a teaching hospital in partnership with 2 universities, as a result of financial problems.

This fiscal year, the hospital had $40 million in operating losses. Hospital officials say they are planning to sell an 80-acre property bought in anticipation of the project to recover a large chunk of the expenses incurred.

Boca Community Hospital is now taking aggressive steps to turn around their financial position. MAR funding is a tool used by hospitals with similiar fiscal difficulties as a way to accelerate cash flow, boost liquidity and get their finances back in shape.

By incorporating MAR funding to their financial turnaround strategy, Hospital officials will be in a better position to revisit the development of a teaching hospital.

Debt Default Rates On The Rise

The June 26th issue of ABF Journal contained an interesting article in which Turnaround Industry Professionals noted that they expect debt default rates to climb substantially. They predicted that debt default rates will rise above 10% in 2009 as the credit crunch continues to disrupt working capital for many healthcare companies.

In a recent Turnaround Management Association poll, about 70% of the respondents expected a surge of defaults in the next three years, with 2009 being especially large. Further, about 94% of the TMA poll respondents said credit is tighter this year and 80% stated that traditional lenders have become less active and are putting more restrictive covenants and conditions on the loans they do make.

Of course, this tightening on traditional loans is creating a working capital shortage for many healthcare businesses and is causing them to seek alternative sources of working capital. Many have discovered that Medical Accounts Receivable (MAR) Funding can be an excellent source of working capital without restrictive covenants/conditions and without putting incremental debt on the balance sheet.

Hospital CFO's Should Seek Nurses' Input

According to healthcare experts at the recent HFMA annual conference, nurses are a key part of a hospital's revenue cycle and their input should be sought after from hospital CFO's.

Nurse input is especially beneficial during the development of organizational business plans experts say. "You have to involve all parties in strategic financial planning," said Susan Sanders, associate vice president for patient services at QHR Consulting. "Sharing information between the nursing staff and finance can be a big improvement in the creation of annual budgets and business plans."

Nurses are also great resources for market research. They can be a great help in developing new product lines or offering new services as they often know vendors as well as clinical colleagues in other hospitals.

Hospital CFO's should be sure that nursing managers understand the impact of overall hospital profitability. They should be aware of the importance of a hospital's liquidity position.

The experts say that the nursing and finance departments need to work together on nurse retention as well.

Cut in reimbursements for medicare

With physician reimbursements set to drop 10 percent, doctors will begin evaluating whether to stay with Medicare.

Senate Republicans blocked action last week on Democratic-backed legislation that would have averted the fee cut by instead reducing payments to insurers that provide benefits through Medicare Advantage plans. Republicans said that the insurer cuts, which the House approved, were too deep and that the Bush administration had threatened to veto the measure. Congress is set to be in recess until July 7.