FROM WHERE I'M SITTING...By jeff mero, executive director

This is shaping up as one of the most difficult advocacy years I have seen in my time here (and that's a long time!). Growing public concern about patient and worker safety and the quality of care we provide is fueling a bewildering array of safety and quality initiatives in Olympia. That's the day-to-day backdrop for what I expect to be a vicious public battle leading to a November vote on two initiatives to address liability and medical malpractice concerns. Lawmakers faced with powerful union pressure, broken families, and damaged children are struggling to hear our concerns about proposals to fix what ails the system. Too often our concerns are mired in complex insurance and legal jargon. The variety of quality improvement programs, policies, and procedures being mandated and/or recommended is threatening to choke smaller care systems.

On the state budget side, we continue to press for funding increases to address growing community needs. Hospitals have not had an increase in basic Medicaid rates since 2001. The state's mental health system is teetering toward nearly total collapse, at least for publicly funded patients. Insurance costs, poor payment levels, and concerns about the risks of litigation are making it difficult for poor women to get prenatal and obstetric services in many rural areas.

Across the state, physicians are finding it difficult to balance their books on Medicaid and Medicare payments. In many communities, it continues to be a challenge for newly arrived seniors to find a doctor who will treat them. This leaves both citizens and providers frustrated.

Meanwhile, the Medicare Payment Advisory Committee told Congress the week before last that it would be okay to reduce the annual hospital update by $800 million in 2006. The recommendations were approved despite findings--by the same committee--that hospital margins for Medicare were negative in 2003: that is, Medicare payments did not cover hospital costs. The changes suggested could "save" as much as $6 billion over the next five years. The group also recommended freezing Medicare nursing home and home health payments. Savings from the freezes are estimated to be at least $2 billion over the next five years. The suggestions come at a time when Congress and the Bush Administration are looking for ways to reduce a massive federal deficit.

And we are continuing to press for help on our biggest challenge of all--developing new health care professionals to replace those that will retire. Professional shortages put strong upward pressure on salary and benefit packages--these demands coming at exactly the same time we face the funding crisis that started this piece. We are asking, again, for significant investments in programs to increase the number of health profession graduates. We are also looking for ways to help ensure that the work force of tomorrow looks more like the community it is serving. State lawmakers, faced with these requests for the third budget cycle, are wondering if what they have done in the past is making any difference.

Advocating on your behalf has always been both a great privilege and an enormous responsibility. It is bold, what you intend--to address the medical needs of your communities. Thanks for letting us be part of it.

SNAPSHOTS

Although the first few days of the legislative session were slow, the pace has picked up considerably. Since January 10th, AWPHD's legislative staff has reviewed a slew of policy bills that could potentially affect PHDs and their operations.

AWPHD's major initiative--legislation that would enable PHD boards to meet in executive session to discuss quality improvement activities--was introduced in both chambers as companion bills: Senate Bill (SB) 5146 and House Bill (HB) 1148. On January 27th, Lisa Thatcher, AWPHD's lobbyist, and Dick Goldsmith, AWPHD's director of legal services, testified in support of the bill before the Senate Health and Long-Term Care Committee, chaired by Senator Karen Keiser. (Senator Keiser is the prime sponsor of SB 5146.)

On February 3rd, the House Local Government Committee will hold a hearing on HB 1341, the proposal by Valley Medical Center (VMC) in Renton (King County PHD #1) and supported by AWPHD, that would enable the larger PHDs in urban-suburban areas to have the same investment opportunities as non-public hospitals. Scheduled to testify in support of the bill are Mike Bernstein, VMC's Chief Financial Officer (CFO); an outside financial advisor for VMC; Lisa Thatcher; and possibly Chrissy Yamada, the CFO at Evergreen Healthcare in Kirkland (King County PHD #2). Also up for hearing at that committee meeting is House Joint Resolution (HJR) 4202, which is the second part of the legislative package for implementation of VMC's proposal: a constitutional amendment that is to be put before the voters in the November 2005 general election. While passage of HB 1341 only requires a simple majority in both chambers, it takes a 2/3 majority in the House and Senate to pass HJR 4202.

AWPHD and VMC could not have moved so swiftly without your support and immediate response to our requests for assistance. When the lobbyists needed certain legislators to sign-on as sponsors or to help us get hearings for these bills, AWPHD members built a groundswell of support with their e-mails, letters, and phone calls. And the assistance didn't just come from Chief Executive Officers/Administrators and CFOs. For instance, Marc Fisher, a commissioner at Lewis County PHD #1 (Morton General Hospital) heard of our efforts around SB 5146 and contacted a friend, Senator Mark Schoesler, who represents the 9th District in Eastern Washington. (Incidentally, if you, your commissioners, or your staff personally know any legislators, please contact Dick Goldsmith (richardg@awphd.org; (206) 216-2528). Your help could be invaluable in getting AWPHD a foot in the door when we're trying to move or block a bill.)

On January 31, the PHD Project Review Board approved two applications to use the General Contractor/Construction Manager (GC/CM) alternative contracting process for large public works projects. The Board gave the go-ahead to Island Hospital, Anacortes (Skagit County PHD #2) to use this process in building a 50,000 square foot, two-story addition (Emergency and Diagnostic Imaging Departments and 31 private inpatient beds) and a 6,000 square foot, one-story addition (including a new entry, registration areas, and chapel). This project, which carries an estimated total price tag of $40 million, will also include a 27,500 square foot renovation of Island's laboratory, birth center, and rehab clinic.

The other successful applicant was North Valley Hospital in Tonasket (Okanogan County PHD #2). North Valley's project, which has an estimated total cost of $10.1 million, is an addition that would house its Emergency, Imaging, Surgery, Acute Care, and Obstetrics Departments. This project will encompass 27,000 square feet of finished space located on two floors and 10,000 square feet of unfinished basement.

The statute allowing PHDs to use the GC/CM process is set to expire on June 30, 2007 unless the Legislature takes action. If your PHD is considering new construction with a total estimated cost of at least $5 million, you may want to look into the benefits of using the GC/CM process. Contact Dick Goldsmith for information about this process. (Look for a detailed review of the PHD Project Review Board's January actions--which should be instructive to future applicants--in the next edition of In Focus.)

Revisions to the AWPHD Legal Manual are now on the AWPHD web site. The Legal Manual, available at www.awphd.org/resources_PUB.asp, can be viewed on-line or downloaded in pdf format and printed out.

These revisions address three areas of PHD activities that were affected by changes to the Revised Code of Washington in 2003 and 2004: reimbursement of recruiting and educational expenses incurred by medical staff and other employees (pages 2-26 and 2-33); alternative contracting procedures--design-build and GC/CM--for large public works projects (pages 3-23 through 3-40); and payment agreements that allow larger PHDs to exchange fixed rate debt for variable rate debt and vice-versa (pages 4-25 through 4-27). All of these changes to Washington State law were brought to the attention of AWPHD members before they went into effect.

The last revision of the AWPHD Legal Manual was in September 2002. If you've kept your manual up-to-date, you need only print out Chapters 2, 3, and 4. (Because the manual can be printed from our web site, we will no longer mail out revisions.)

NETWORK NEWS

Western Washington Rural Health Care Collaborative (WWRHCC)

WWRHCC's January Board retreat was a great success: 15 people representing all eight members of the collaborative set the organization's priorities for 2005.

The collaborative has received a $24,000 Flex grant to work on quality and Critical Access Hospital requirements.

WWRHCC is putting together applications for two grants. For a teleradiology project that will cost in the neighborhood of $1,000,000, the collaborative is seeking a $342,800 Rural Utility Service (RUS) Distance Learning Telemedicine Grant; the remaining project costs would be covered by $432,600 of matching funds the collaborative already has, as well as additional matching funds and in-kind services. Garfield PHD and the Neah Bay Indian Health Service Clinic would be part of this project.

To build a telespecialty cooperative to address the shortages of physician and ancillary specialty clinicians (for example, diabetes educators who are bilingual), the WWRHCC is applying for a Health Systems Resource grant from the state Department of Health.

PEOPLE AND PLACES

Mike Wiltermood, CEO at Coulee Community Hospital (Douglas-Grant-Lincoln-Okanogan Counties PHD), will be leaving the district in early February to take over as the Chief Operating Officer of the Fremont-Rideout Health Group. Fremont-Rideout owns hospitals in Yuba City and Marysville, California. Jerry Lane will be the district's interim CEO.

UPCOMING EVENTS

WSHA Rural Hospital Committee Meeting
February 2 - 10:00 a.m. • Hilton Hotel, SeaTac
Contact: Johanna Bradford (206)216-2510

WHF Quality Connection 2005
February 3-4 - Bell Harbor Conference Center, Seattle
Contact: Barbara Hitzl (206)216-2512

WSHA Executive Committee Meeting
February 11 - 7:30 a.m. • WSHA Offices, Seattle
Contact: Lisa Rusk (206)577-1852

WWRHCC Member Meeting
February 24 • Ocean Beach Hospital, Ilwaco
Contact: Elizabeth Floersheim (206)577-1851

WSHA Strategic Planning Committee
February 25 - 10:00 a.m. • WSHA Offices, Seattle
Contact: Lisa Rusk (206)577-1852

AWPHD Board Meeting
March 14 - 10:00 a.m. • AWPHD Offices
Contact: Wendy Ray (206)216-2516

AWPHD Antitrust Webcast
March 15 - noon • Webcast
Contact: Wendy Ray (206)216-2516

WSHA Winter Board Retreat
March 17-18 - Fairmont Olympic Hotel, Seattle
Contact: Lisa Rusk (206)577-1852

WWRHCC Member Meeting
March 23 • Red Lion Hotel at the Park, Spokane
Contact: Elizabeth Floersheim (206)577-1851

Regional CAH Conference
March 23 • Red Lion Hotel at the Park, Spokane
Contact: Cathi Lamoreux (509)358-7640

NW Regional Health Conference
March 24-25 • Red Lion Hotel at the Park, Spokane
Contact: Cathi Lamoreux (509)358-7640

Items for the February In Focus should be sent to Dick Goldsmith at richardg@awphd.org by Friday, February 18.

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