Tuesday, August 30, 2011

Need a Hospice Plan

Certain patients in the hospital have no chance of recovery.  The medical team struggles mightily, but their health continues to deteriorate.  First one organ and then another starts to fail until nobody remembers what the patient was in for in the first place.  Now all they are is just a bunch of tubes, medicines, and procedures; making sure no mistakes are made in the regimen and hoping that they don't die on your watch becomes an end in itself.  At that point somebody might suggest a palliative care consult (it should have happened much sooner actually).  That meeting may go well if the patient's family understands the situation or it can go poorly with people accusing the medical team, other members of the family, and the insurance payor as just trying to kill off the beloved family member because that's more convenient/saves money/or they never really liked him/her.  Thing is, the patient dies eventually no matter how fiercely the family fights. 

Highlights from the Finance and Management Committee Packet for tomorrow (8/31) at 7:30 am:

1.  135,000 loss for the very first month despite the cost savings measures being pretty much fully implemented.  The District did this horribly despite successfully performing on the expense front favorably to budget.

2.  Only 250k drawn down on Bank of Alameda emergency line of credit, but no pay down on accounts payable.  In fact, accounts payable increased by over 350k.

3.  I like the presentation of fixed assets that breaks it down more.  Construction in progress in over 3 million dollars and the part of the number that is associated with the seismic retrofit is pretty much worthless in my opinion.

4.  The "cushion" on the 1:1 current ration is down to 930k.  This does not factor in any issue with possible CMS reduction in the IGT reimbursement.  Since the IGT reimbursement is still on the balance sheet, I assume that there has been some indication of when it will be paid finally so maybe there was no reduction after all.  (Also, no update on the SPA for the skilled nursing facilities, but I would be surprised if CMS does not approve it.  Luckily, the reduced compensation is build into the budget.  Unfortunately, the District is already missing its budget by 238k.)

5.  Mandatory stroke training in July negatively impacted the nursing budget in July.

6.  Cash is down to below 700k but there is 500k left on the emergency line of credit plus eventually the IGT funds will be returned so this seems manageable.

It is [fill in your favorite word for not taking care of business] for the Board to not direct management to create a contingency plan for winding down acute care operations.  Management should be recommending to the Board that they engage in that planning on their own initiative.

It seems that a reference to the old quote about the inevitability of taxes and death is the best way to end this entry.



Tuesday, August 16, 2011

Current Affairs

So I promised to revisit the balance sheet when I had the chance.  I want to talk about the current ratio because it is one of the reasons I refer to the District as being a financial disaster and because current ratio is part of the modified Bank of Alameda loan agreements.  Current ratio is just Current Assets/Current Liabilities.  It is unclear whether, if push came to shove, the District would include restricted assets in that calculation, but, for now, they do not.  The current ratio needs to stay greater than 1.0 to be compliant with the modified loan agreement.

Now  the 2003 current ratio is a respectable 3.08.  That is a fairly desirable number.  It's actually even better since there was enough cash and liquid investments to cover 100% of the current liabilities.  In fact, the District in 2003 had enough cash to pay down every debt to zero.  In 2011, the current ratio is a dismal 1.05 and the cash would barely cover 10% of the current liabilities. 

For purposes of the loan, most likely the current ratio will dip below 1.00 at some point in this fiscal year, but that event may or may not coincide with the quarterly test dates (9/30/11, 12/31/11, 3/31/12, and 6/30/12).  For the current ratio to dip below 1.00, current assets minus current liabilities would need to be less than zero.  The Districts current "cushion" from this happening is a little under 1 million dollars --$970,785 to be precise.  Any combination of decrease in current assets or increase in current liabilities that totals more than this will cause the current ratio to fall below 1.00.

1.   Borrowing short term and paying off bills will not change the current ratio because it just rearranges the current liability numbers so accessing the emergency LOC from Bank of Alameda does not change much.

2.  Borrowing short term and holding cash or purchasing short term assets changes the current ratio (decreases it), but does not change the "cushion" because increasing the numerator and the denominator of a ratio by the same value just moves it closer to 1.00, but will not change the sign of the log.

3.  Borrowing long term and holding cash or purchasing short term assets changes the current ratio (increases it).  In fact, this is a desirable situation so I have never understood what it means to think that the lack of long term debt for the District is an especially positive aspect of the balance sheet.  Sure less long term debt is better than more long term debt, but, on the whole, adding to long term debt to adjust other parts of the balance sheet is almost always a positive.

4.  Borrowing short term and increasing fixed assets changes the current ratio (decreases it) and decreases the "cushion".  This is the main reason I believe that the District is almost guaranteed to have a current ratio below 1.00 because, until the wound care construction loan is converted, it is short term debt.  The wound care build out is fixed assets so with a draw of 700k, the "cushion" just got reduced to less than 300k at some point when construction is nearing completion, but conversion of the loan has not happened yet.

5.  Losses on a ytd basis that exceed 300k.  It will not be good enough for the District to make a profit in the coming year, that profit will have to be consistent on a year-to-date basis.  Someone can check me, but I do not believe the District has had more than 3 years since its formation where this was true.  Certainly neither of the last two years would the District have achieved this goal.

Two big numbers to watch for to determine if the District can maintain the 1.00 current ratio will be the July income numbers, after the parcel tax subsidy is applied, of course (positive is a positive sign and negative is terrible); and the final IGT number from CMS since even a relatively modest 50k hit takes away another 1/6 of the "cushion".

Sunday, August 14, 2011

Board Meeting 8/8/11

1.  The open part of the Board meeting began with the Annual Auxillary Report.  When I walked in and saw a full room, I thought that there was going to be a succession of people criticizing me and saying how wonderful the Hospital was.  When I realized that the Auxilliary was there to report, I thought maybe it was just volunteers there to show the flag.  My first instinct was correct.  Anyway, the auxilliary has about 75 members who do everything from staff the gift shop to making well-check phone calls to seniors (telecare - pending approval).

2.  After pulling most of the consent calendar, it consisted of the regular meeting notes and a change to the medical staff rules.

3.  The June, 2011 financial statements are unaudited, but the year-to-date results are for the full fiscal year.  The projected FY2011 end of year income as of April 4, 2011 was 196k profit.  The unaudited actual presented at the Finance Committee on July 27 (and again at this Board meeting) shows a loss of 1658k.  Now that is almost a 2 million dollar swing in under four months.  No reasonable person can tell me that management or the Board is exercising competent oversight with a swing like that.  It cannot be all David Neapolitan's fault.  If this was a public company then there would be resignations beyond just the CFO.  Audited result will be available in October.  CMS may cut the IGT number even more which just increases the misery.  No reasonable person would believe a budget number from an organization that had such a dismal track record in predicting future results.

4.  Board policy on confidential information -  This resolution, in my opinion, was built on a platform of misrepresentation by certain individuals.  I questioned its usefulness and got no useful answer.  I inquired as to whether I could avail myself of District counsel's advice with respect to the the Brown Act and this blog and got no useful answer.  I think Mark Twain in Pudd'nhead Wilson expresses best my opinion regarding this resolution.

5.  The signature authority moves check signing authority to the Treasurer from the Secretary.  It makes sense to me.

6.  The Electronic Devices resolution could not find a second.  I will reiterate that I find it interesting that Mr. Driscoll had the time and that Director Battani felt it a useful expenditure of District funds to draft this resolution.   Of course, like I said above, Twain covered this ground over 100 years ago.

7.  The Medical Staff President report was preceeded by a parade of bitter MD's and staff exhibiting admirable passion, but more than a little off the mark.  If they would have considered the question as a medical question for a patient, "Which location provides the best result?" in the same way they evaluate the question of which procedure or drug is best then their former preceptors would not be thrilled with the quality of their argumentation.  I certainly was happy that they care so much, but disappointed that they lacked the ability to articulate a coherent argument.  (The best I could do was smile weakly and awkwardly somewhat embarrassed on their behalf.)

8.  Approval of modification of the wound care Line of Credit.  I voted yes because the Board and management has committed the District to a 10 year lease that represents a commitment of over 2 million dollars.  Mr Driscoll has written a letter to confirm the fact that Alameda taxpayers will have to make good on that lease whether any value is received or not.  This is not a long-term liability for balance sheet purposes, but it certainly was a decision that obligated the District for a huge amount of money on an unproven strategy executed by management that has failed, in general, to meet its financial projections over the entire course that it has been at the helm.

9.  Approval of modification of the emergency line of credit.  I voted no.  Just another finger in the dike of the [Update 8/15 just to be clear "financial disaster"] disaster which is Alameda Hospital.

10. Presidents Report.  a.  Nothing particularly interesting.  Dan Dickenson gave a meaningful use update that seemed to cover the pertinent issues.
b.  Deborah Stebbins is somewhat optimistic about July results.   Most/all of the layoffs were effective 6/27 so, hopefully, the District has staunched the bleeding.
c.  Management will be meeting with Alex Briscoe (Alameda County public health) this week to get routing of stroke victims back to the Alameda Hospital's ER.   I hope myself or my loved ones can convince the EMS personnel to take the few extra minutes to go somewhere else if I am ever so unfortunate as to suffer the signs and symptoms of a stroke.

11. I apologize, but I recall little of note of the remainder of the meeting.  Video is up at the Alameda website.

12. Near the end of the meeting, I responded as best I could to the earlier comments by medical staff.  Jim Yeh also responded.  I thought it was a decent beginning of a dialogue at that point.  The District takes 5.7 million dollars from Alamedans every year.  Apparently,  I am a minority of one on the Board in thinking that there is a moral and fiduciary obligation to justify spending those dollars.  It's not good enough, in my mind, to be no worse than the alternative because the alternative does not cost 5.7 million dollars.  The alternative is free AND [if you are willing to believe the well-documented, enormous body of volume-outcome evidence published in the medical literature] will more likely than not lead to better healthcare outcomes.

Friday, August 12, 2011

Am I Clairvoyant?

Not really, but when you are dealing with a person who has an online personality that appears to be mean, spiteful,  and predictable, like "Blogging Bayport's" proprietor,  it is easy to see what's coming.  Back on June 7, I posted a comment to my own blog.  Since that time, Do has published several pieces on her blog - all of which have been factually inaccurate in some way.  Up to today,  character assassination was not part of the attack, but she just can't resist.

To the meat of her argument, that professionals on Alameda staff are right and I am wrong; I will just invite you to take a look at the studies that one doctor quoted.   The first one's abstract is here  and gives you a link to pay for the full article.  It concludes:
Compared with non-CAHs, CAHs had fewer clinical capabilities, worse measured processes of care, and higher mortality rates for patients with AMI, CHF, or pneumonia.
The second one I could not find even though I was searching for it.  It might be a commentary on another article, but I'm not sure.  What the quote that Dr. L cited when he spoke essentially boiled down to is that one should not blame volume for the outcome disparity which was seen in the study, but that differences in patient selection are a confounding factor.  Neither of those studies were used on this blog because they were not applicable.

No study has ever shown that low hospital volume is beneficial to outcomes.    That Dr. L.  cherry picks a few quotes from studies that I deemed inapplicable and that, for all practical purposes, support my conclusion is a discredit to him.  I only referenced studies (and only a smattering of studies) that I felt were most applicable.  If someone wants to read the 100's (1000's?) of studies that look at volume-outcome associations and find one that shows an inverse relationship then be my guest, but you won't just have to convince me, you will have to convince every other serious person in the world.

Thursday, August 11, 2011

Fight, Fight, Fight (navel gazing)

Stepping back from the question of quality of Alameda Hospital, I want to list some of the more interesting questions that I have about medicine/public health.  Believe it or not these questions can get people riled up.

1.  PSA screening's value?  (I say yes.)
2. Mammography between 40 and 50 years old?  (I say yes, but weakly.)
3.  Defensive medicine a cause of high healthcare expenditures in the US?  (absolutely not in my opinion.)
4.  Stent vs. bypass? (Used to be more anti-stent, but, although I still am, not nearly so much.)
5.  Zetia? (could be a warning sign that the prescribing doctor is lame.)
6.  Arbs cause cancer?  (Nope.)
7.  Socialist style universal healthcare?  (YES!!)
8.  Risk vs. benefit of vaccines?  (Could be a warning sign that the parent is lame.)
9.  Regionalization?  (I;m sure you can guess.)
10. Cell phones? (The largest unsupervised medical experiment in history and probably harmful, but worth the risk.)

Wednesday, August 10, 2011

Bigger is NOT Better

When it comes to parcel taxes.  I am looking for confirmation, but it appears that Alameda's parcel tax for the District is the largest per parcel in the state for any healthcare district.

Do Bee a Do Bee,

Lauren Do has a post up this morning about hospital quality.  It would be worth fisking if I had the time.  On the other hand, Lauren has admitted she doesn't have a dog in the fight so she might actually be trying to engage in an honest debate.  (Hard to tell because although I think she is intellectually curious enough to want answers, she is politically engaged enough to want those answers to come out a certain way; that is, in favor of the political clique she belongs to.)  I don't comment at Lauren's site, but feel free to engage in the comments here if you wish me to respond.  A couple points to hopefully start off the discussion:

1.  I read each of the studies through, but many are copyrighted  and require paid access so I only posted the abstracts which give full bibliographic information and contain the information that the researchers thought was most important for those with limited time.    If Lauren wants copies, she can pay for them or contact someone with access to paid subscriptions.

2.  I'm not sure what Lauren's point was in pulling quotes from the NEJM, March 25, 2010 article, "Hospital Volume and 30-Day Mortality for Three Common Medical Conditions" since they hardly contradict anything I have said.

3.  I urge you to read the full report that she posted where she excerpted the quote regarding caution in using hospital volume as a proxy for quality. 
       -It is an admirable piece of consumer information, but hardly a peer reviewed article.
       -Overall, it has more information that supports my thesis than contradicts it.
       -It's main purpose, if you read to the conclusion, is to tell Pennsylvanians what a wonderful job the state agency who wrote the report is doing in collecting real hospital quality information so they don't have to worry about proxies.

See you in the comments and I am still open to face to face meetings with people.

Tuesday, August 9, 2011

Touche

I'll have a fuller post up later this month on tonight's Board meeting (8/8/11), but I was a little taken aback when I heard from somewhere in the room "you should know!" immediately after I finished speaking regarding Director Battani's effort to pass a resolution regarding her "pet peeve" of electronic communication during meetings.

My quote regarding this resolution was something like, "I might characterize it as petty," to which the above rebuke came back immediately.  I was probably a bit strong, but I was struck by how Battani so easily engaged Mr. Driscoll's services to author this resolution (maybe he did it for free?), but thinks addressing my legal concerns are a waste of resources of the District.

Sunday, August 7, 2011

Some Clarification Regarding Earthquake Standards - FIrst NPC

There are deadlines for three different levels of earthquake safety and people can easily conflate them if they are not well-versed. There are the NPC (non-structural performance category) guidelines and the SPC (structural performance category) guidelines.   To begin with, one of the best primers on these issues even if there is some things that are deliberately misleading is Kerry Easthope's presentation to the Board for the January, 2011 meeting.  Ignore his February memo for the Board since it is error prone and incorrect in several key aspects with the exception that he is correct that the Hospital has a valid license to operate (more on this below).

The NPC-2 requirements

"After January 1, 2002, any general acute care hospital
building which continues acute care operation must, at
a minimum, meet the nonstructural requirements of
NPC 2, as defined in Article 11, Table 11.1 or shall no
longer provide acute care services."
This could not be clearer, right? Alameda Hospital does not meet the NPC-2 requirements.  For people who believe I have a "point of view", the fact that Alameda Hospital does not meet the NPC-2 requirements is undisputed by Hospital management, fellow Board members, and OSHPD.   Except OSHPD has not enforced this explicit code.  Despite the false argument that Hospital management has made that there is an implicit/explicit extension of this deadline, there have been no extensions granted by OSHPD.  I confirmed this with public records act request to OSHPD, a conversation with Christopher Tokas (head of the Seismic Retrofit Program Unit within OSHPD's Facilities Development Division), and a conversation with staff counsel at OSHPD.  The only reason the Hospital has not been shut down is because OHSPD has not brought an action against the Hospital. 

It is unclear how many hospitals throughout the state are in the same boat.  A public records act to OSHPD yielded a long list which, in some cases, such as UC hospitals I knew to be incorrect in listing facilities as non-compliant that had completed the necessary work or been taken out of service.  Many fewer than people suppose is the best answer I can give, but probably still quite a few.  One problem is that OSHPD reports non-compliance in terms of buildings rather than institutions.  Here is a presentation from December, 2009 with more infomation, but I caution you that it overstated the level of non-compliance at that time and certainly is not current as of today.

Will OSHPD ever enforce this regulation?  I doubt it unless they use it as part of a larger action against an institution.  Could a private citizen force OSHPD action?  I think the answer is yes (with a writ of mandate) but it depends on the degree of discretion that OSHPD has regarding this regulation relative to the legislative intent.  If the regulation is a product of OSHPD only with direction from the legislature to create some regulation then I doubt that a lawsuit would overcome the vigorous opposition that both OSHPD and the District would mount.  If the regulation has it's basis in legislation then the lawsuit might succeed although, just as likely, the legislature would pass a change given that closing hospitals is hardly politically correct.

Why would I not file such a lawsuit? 1.  I think it presents too large a conflict of interest for me to continue to serve on the Board and be a party to a lawsuit against the District (although technically it would be against OSHPD).  2.  It's expensive and time-consuming.  3.  The outcome is uncertain.  4.  even if successful, legislation could be quickly passed that yielded any victory in court moot.  5.  The Hospital is doing a good enough job imploding on its own.  6.  The Board majority and management already treat me fairly shabbily and I have about reached my limit to the amount of incivility, bullying, and outright misrepresentation that I can stand from therm.  Surely a lawsuit would just intensify those efforts.

Make no mistake though, whatever you think about my "point of view" the Hospital is in non-compliance with black and white state regulations.  (More on SPC requirements at a future time.)

Thursday, August 4, 2011

If the Hospital was the Patient and the Board the Physician

1.  Then the idea that a 9 year old vote should direct all actions today would be like the idea that a family meeting 9 years ago when dad was briefly in the ICU post-op should establish the guiding principals now that dad has had 2 strokes and has been on a ventilator for a week.

2.  Then the idea that the only evidence that should be used when thinking about quality of care should be studies done at Alameda Hospital would be like arguing that a particular medicine or procedure was no good since it had not been tested in that particular patient (and by the way, it would be ridiculous to even try it because we know it doesn't work because it hasn't been tested).

3.  Then the idea that being open, transparent, and following the Brown Act were just too inconvenient and might endanger future deals  (and only should be followed anyway based on the risk of getting into trouble vs. actual principals) would be like suggesting that following HIPAA and the patient's bill of rights were just too inconvenient and might get in the way of treating the patient.

4.  Then the idea that using published sources in real time (such as PubMed) during Board meetings was uncivil would be like telling the patient that everything on the Internet was crap because the physician didn't like being challenged.

I certainly would not want a physician who acted like that, but apparently the Board majority and many Alamedans thinks that how physicians SHOULD act.