REPORT TO THE BOARD OF DIRECTORS – February 2015

Good afternoon. As customary, I will highlight just a few items from the full version of my report to the board. The full version is available to all here and will be posted on our website.

At our January 29th meeting, the Board asked for more information regarding the proposed contract to build a web-based system for Health Home and DSRIP patients care coordination. At that time, the Board asked who will be paid the funding earmarked for connectivity.

The answer is: up to $14 million will be paid to GSI Health Inc. for the completion of this work.

The Board also requested that I review and report back on GSI’s capability to perform the contract. The leadership team and I have performed due diligence and have concluded that GSI possesses the financial, technical and professional capacity to execute our objectives.

We also note that the contract terms will include software escrow measures and risk mitigation strategies designed to protect this substantial investment in our future in the unlikely event that GSI ceases operations for any reason. Based on these findings, we recommend proceeding under the resolution as written and passed last month.

Last week Fitch, the national bond rating service, acknowledged our better fiscal performance over the past year by affirming an A+ rating on bonds issued by the Corporation. Fitch highlighted the fact that our operating margin is much improved over FY 2013, from minus 9.2 to minus 1.2. The Fitch report also noted that HHC’s patient service revenue grew by 10%, and that revenue at MetroPlus grew by 6% while costs were contained at an increase of just 2%. Restoring fiscal stability to HHC is, as we are all aware, our top priority. And although we have a long way to go, last week’s statement from Fitch is encouraging.

As a group of partners working closely together to pursue a common goal, our Performing Provider System (PPS) has made great progress over the past several months. Its new name — OneCity Health — is one that reflects this shared commitment, to improve the health of all New Yorkers. We are in the process of developing both a logo and website for OneCity Health, and plan to share these shortly.

A PAC (Project Advisory Committee) meeting was held at Woodhull on February 4. More than 100 partners joined us for discussion.

On February 4, state released DSRIP scores for all PPSs across the state. Scores are based on the weighted sum of three components. Our scores are:

• Organization-Wide score – 97.7%
• the Project Strategies score – 96.9%
• the Speed and Scale score – 75.7%

We are very pleased with both our Organization-Wide and our Project Strategies scores. While our Speed and Scale score is lower, it reflects our realistic approach to the projects with due deference to the size and complexity of our work.

Overall, our scores are consistent with all other PPSs across NYC, and we remain convinced that our conservative approach will serve us well in maximizing our performance and helping to ensure that we meet the goals we have committed to achieving.

You will also recall that the state has allocated $1.2 billion over the next six years for a Capital Restructuring Fund designed to promote sustainability of DSRIP transformation.

On Feb. 20th The OneCity Health submitted $760 million dollars in capital requests to the state.

On February 12th the New York State Public Health and Health Planning Council voted against the pending Certificate of Need application of Big Apple dialysis service and decided to reconsider it in a future meeting.

In preparation for that meeting, the Council has asked the Department of Health to provide further information and analysis.

We now will await the State’s further deliberations. We want to reiterate that access and quality are our primary goals.

On February 2nd, President Obama released his recommended budget for federal fiscal year 2016. The proposals in the President’s budget that are of most significance to HHC are:

• Medicare and Medicaid provider cuts totaling $430 billion over the next ten years.
• Including reductions in Medicare payments for hospital based outpatient services of $29.5 billion over 10 years. The impact on HHC would be an estimated $186 million of reduced payments over 10 years.
• Reductions in Medicare post-acute care provider services by $113.6 billion over 10 years. The estimated impact for HHC over 10 years is $20 million.
• $7.7 billion in additional Medicaid funding to States.
• $11.8 billion in new funding for the Children’s Health Insurance Program until 2019.
• 10% reduction in Indirect Medical Education funding for 10 years. The impact to HHC would be a $10 million annual reduction.
• $2.7 billion annual increase over three years for Community Health Centers.

The President’s FFY 2016 budget also proposes to add another year, through 2025, of the Medicaid Disproportionate Share Hospital funding cuts that were included in the Affordable Care Act. The impact of this proposal could reduce New York State’s Medicaid DSH funds by an estimated $421 million for that year.

Also of concern are two pending regulatory developments that HHC’s Intergovernmental team continues to monitor closely:

• The Health Resource Services Administration (HRSA) may promulgate wide-ranging new regulations concerning the 340B pharmaceutical discount program. Changes to current rules could negatively impact the benefit HHC derives from its participation in that program.
• Enforcement by the Centers for Medicaid and Medicare Services (CMS)of the Two-Midnight Rule in which only stays of Medicare patients spanning two midnights will be reimbursable.

The State Budget process is well underway. The Senate and Assembly will complete their Joint Budget Hearings tomorrow. In the next two weeks they will each release their own Budget Resolutions and begin the Conference Committee process to reach agreement on a final budget, which must be enacted by April 1st.

I will travel to Albany next week to meet with legislators in an effort to ensure that the Corporation’s three key priorities are addressed in the final budget, including:

• Adoption of Budget language modifying the way the State distributes our Upper Payment Limit funding.
• Extending the current methodology for distributing Charity Care funding for three years in a way that protects us when federal Disproportionate Share Hospital funding cuts are implemented.
• Behavioral Health Services Rates as New York transitions from Medicaid Fee-For-Service to managed care. The state’s proposed premiums are insufficient because they do not reflect our costs of providing these services.

I’d like to take this opportunity to remind the Board that March is National Colorectal Cancer Awareness Month. Our system is a critical partner in New York City’s efforts to control colon cancer. We are continuing our annual tradition of actively encouraging our staff, patients and all New Yorkers over 50 to get a potentially life-saving colon cancer screening.

These efforts have been a major force in closing the gap in racial and ethnic colon cancer screening disparities among Blacks, Whites, Hispanics and Asians.

I’m happy to report to the Board that for the second year in a row, the corporation is the recipient of the annual Healthcare Supply Chain Achievement Award from ECRI Institute an independent, nonprofit organization that researches the best approaches to improving patient care. The Institute recognizes initiatives that include spend management and analytics for medical devices. It also seeks to highlight clinically sound and financially savvy approaches to technology decision making. The winning organizations were chosen from nearly 3,000 hospitals and health systems.

This award, for the second year in a row, recognizes our effectiveness in improving healthcare quality and reducing costs by adopting supply chain best practices. Congratulations to all staff responsible for achieving this outstanding award, particularly to Paul Albertson, Senior Assistant Vice President and Jun Amora, Director of Strategy, who have lead this effort under the direction of Executive Vice President Antonio Martin

Also concerning awards, I’m pleased to recognize that our fellow HHC Board Member, Robert F. Nolan, has been named a recipient of the United Hospital Fund’s 2015 Distinguished Trustee Award for dedication and leadership in governing not-for-profit hospitals.

An awards luncheon honoring Bob and the other recipients will be held on Monday, May 11, from noon to 2 pm. Our congratulations to Bob for this prestigious and well-earned recognition.

We were very pleased to announce that Anthony Rajkumar has been appointed Executive Director of HHC Metropolitan Hospital Center (MHC).

Mr. Rajkumar is not new to our organization having served in various leadership roles in Queens and Central Brooklyn networks. He brings a wealth of experience to Metropolitan, with nearly 30 years of leadership experience.

As you know, each month at the Board meeting we highlight one of our programs that exemplify an essential service we provide to New York City which is more than quality health care — affordable health care. This month I call your attention to our Family Court Mental Health Services program.

At Family Court Mental Health Services clinics across the city, psychologists, psychiatrists and staff conduct mental health evaluations for individuals referred by Family Courts. These clinicians offer professional advice to judges make life-changing rulings—
— whether children should be separated from their parents, or
— whether a juvenile delinquent should be returned home or placed in a residential facility.

I’ve said many times that cultural competence and sensitivity are hallmarks of The Health and Hospital Corporation. We understand them better than anyone else. We “are” the communities we serve. Our understanding of diverse communities across the city makes us superbly well-qualified to help the courts “get it right” when deciding terribly difficult cases.

I wish to share with you a case — a case these clinicians assisted with recently in the Bronx.

This team was asked to evaluate a Congolese-American woman’s fitness to parent to her young daughter.

The woman has endured great emotional trauma. She was a victim of torture prior to her coming to the USA. Her story is complicated further by an acculturation growing up in the Congo, involving a belief in demons. Unfortunately, secretive practices of faith-based child abuse are not uncommon in that part of the world, where children who are disabled, wet the bed or, suffer nightmares, are sometimes accused of being possessed by demons. Sometimes these children are forced to endure painful rituals, starvation or beatings.

While such practices may be a day-to-day occurrence in those parts of the world — obviously they are abhorrent to our thinking. Many would consider holding these superstitions as evidence that this mother was unfit to parent.

In this case however, our clinician’s knowledge of Congolese culture helped the court to look empathetically at the negatives and to recognize the mother’s strengths. She was evaluated as not posing a threat of harm to her child.

It turned out that she is educated, resourceful and has demonstrated an ability to hold on to a job. Our clinician was able to come to know this woman with an open mind, and to judge her past in Congo not by our standards but by the reality of life in Congo — only to conclude that it was better for the family — the child and the mother — to continue supervised visits.

This degree of cultural sensitivity and expertise shows the value that so many of our programs add to the City. I am delighted to bring your attention to this program, and hope you’ll share my enthusiasm in congratulating its staff for work well done.

Let’s have a round of applause for Dr. Marcia Werchol, Assistant Vice President for Family Court Mental Health Services and Michael Duncanson, Program Director.

Over the past year I have highlighted many employees doing outstanding clinical work at our facilities, in the field and abroad. However, a person doesn’t need to be doing dramatic work to be a hero.

They might be a hero working quietly in an office, performing a job without fanfare that is essential to the system’s operations and future well-being. John Jennings, Assistant Director of Revenue Management and Operations is such a man. I am glad to honor him today.

I’ve said many times in the past year that achieving financial stability is one of our most pressing goals. Without this, we will be unable to continue fulfilling our mission to provide care for all who need it in New York City.

John Jennings is on the frontline of helping us achieve our financial objectives. He helps this organization succeed in the most fundamental way, by remaining financially viable.

His work may not seem dramatic, but John ensures that we receive every cent of every Meaningful Use incentive dollar that we’ve earned by deploying new technology across our system.

For many of us, this work might not make the pulse race—but viewed in terms of ensuring our survival, it’s no less heroic. And it’s what John Jennings does.

John has dedicated his professional life to the corporation. He started here after graduating from SUNY Brockport in 1978. He’s a native Long Islander, with deep roots, family and friends there.

John does a tremendous job making sure that we meet all of the verification, enrollment and authorization requirements necessary to keep the pipeline of federal incentive dollars flowing. Through his diligence, and that of his colleagues, we have earned $116 million in Meaningful Use payments to date.

John’s intelligence, specialized expertise, and commitment are great assets to the corporation. We’ve been lucky to have him on the job for the past 36 years. I am hoping that after today’s recognition perhaps we can persuade him to stay another 36. Join me in giving him a greatly deserved round of applause.

Broadcast

Elmhurst Hospital Art Exhibit Highlights Survivors of Torture, NY1 News, Elmhurst, Dr. Braden Hexom, Associate Medical Director, Libertas Center for Human Rights Elizabeth McInnes, Case Manager, Libertas Center for Human Rights

Wile E. Coyote inspires new way to diagnose concussions, CBS Evening News, Bellevue: Dr. Uzma Samadandi

Ebola Doctor Craig Spencer Speaks Out, WNBC, Bellevue: Dr. Laura Evans

City Hospitals Privatization Efforts Rebuffed, WNYC, HHC, Elmhurst, Metropolitan, Lincoln, Harlem, Kings

Firefighters Fight Smoldering Warehouse Fire for Second Day, WNBC, HHC

In Foster Care, Treating the Trigger, WNYC, Bellevue: Dr. Jennifer Havens, Director of Child and Adolescent

Psychiatry; Isaiah Pickens, Phd; Ashley Bujalski, START clinician

Sexual Assault Treatment Program Needs Volunteers, News 12 Bronx, NCBH: Elaine C. Garbaty, LCSW-R, SATP Coordinator; Debbie Hayashi, LCSW, SATP Advocate Coordinator; Jacobi, Lincoln

BronxTalk, Bronxnet.org, Jacobi, Dr. Noe Romo, Medical Director, Stand Up to Violence (SUV); Edwin Mendoza, Outreach Worker, SUV

NYC Doctor Who Contracted Ebola to Speak at Wayne State University, WNBC, Bellevue

Bilingual Health Insurance Enrollment Counselors, NY1 News, HHC, Elmhurst, MetroPlus, Gabriela Mayorga, Community Relations Coordinator

Print

New York health expert gives tips on mastering Obamacare enrollment, New York Daily News, MetroPlus, Seth Diamond, COO

Metropolitan Hospital Center Names Anthony Rajkumar Executive Director, Capital New York, Dr. Ram Raju

HHC Metropolitan Hospital Center Names Anthony Rajkumar Executive Director, Becker’s Hospital Review, Dr. Ram Raju

HHC Bond Rating, Crain’s Health Pulse, HHC, MetroPlus

Fitch Affirms New York City Health and Hospitals Corp. Revs at ‘A+’; Outlook Stable, Reuters, HHC, MetroPlus, Bellevue, Coney Island

In Treating Ebola, Even Using a Stethoscope Becomes a Challenge, The New York Times, Bellevue: Dr. Laura Evans

State to receive $32 million from Feds for Ebola Spending, Capital New York, Bellevue

HHC Extends Contract, Reports Payer Mix, Crain’s Health Pulse, HHC President Dr. Ram Raju; Kings County

Look-Alikes OK’d, Crain’s Health Pulse, HHC, Gotham Health

HHC Sues HHS for $15 Million, Crain’s Health Pulse

Shoddy HHS Calculation Cost NYC Hospitals $15M, Suit Says, Law360

State does not approve Big Apple Dialysis application, Capital New York, Kings, Lincoln, Metropolitan, Harlem

PHHPC Defers Decision on Big Apple, Crain’s Health Pulse, Kings, Lincoln, Metropolitan, Harlem

Unions gear up for another round with Big Apply Dialysis, Capital New York, HHC: Dr. Ram Raju, President

Docs’ Council: No Big Apple, Crain’s Health Pulse, HCC, Dr. Ram Raju, President

James Blasts BdB Over Big Apple, Capital Health Pulse, HHC, Kings, Lincoln, Metropolitan, Harlem

Big Apple Dialysis back on agenda, angering union, Capital New York, HHC, Elmhurst, Kings County, Lincoln, Metropolitan, Harlem

Quality Questioned in HHC Dialysis Sale, Crain’s Health Pulse, HHC, Dr. Ram Raju

Massive fire engulfs warehouse in Brooklyn, New York Post, HHC.

Fire rips through Brooklyn warehouse Saturday, burning city and state records, Daily News, HHC

Fire at a Brooklyn Warehouse Puts Private Lives on Display, The New York Times, HHC

Hospital Archives Burn in Brooklyn Warehouse, The Wall Street Journal, HHC

In Williamsburg Warehouse Fire, Lingering Risks of New York’s Analog Age, The New York Times, HHC

Damage to Records in Brooklyn Warehouse Fire Is Less Than Feared, Officials Say, The New York Times, HHC

Brooklyn Fire a Security Reminder, Crain’s Health Pulse, Harlem

Q&A with Ramanathan Raju on Health and Hospitals, City & State, HHC, MetroPlus

Q&A with Corey Johnson on Health and Hospitals, City & State, HHC, MetroPlus

Confusion abounds at DSRIP oversight panel, Crain’s Health Pulse, HHC

E.R. re-admissions for asthma and mental illness remain high, Capital New York, HHC

Winter Storm Juno: How hospitals prepared-and kept patients safe, The Advisory Board Company, Dr. Ross Wilson, HHC Chief Medical Officer

Five Tips To Improve Heart Health In Harlem Wellness, Harlem World, HHC, Bellevue: Norma Keller, MD, Chief of Cardiology

Heart Health in Women: Take Control and Make a Difference, The Bronx Free Press,
Dr. Lekshmi Dharmarajan, Lincoln

ECRI Announces 2015 Healthcare Supply Chain Achievement Award Winners, Healthcare Matters, HHC

Big healthcare breaches affected millions before Anthem’s hack, Modern Healthcare, HHC

Thyroid Disease: What you should Know, OpEd, The Bronx Free Press, Lincoln: Dr. Tasneem Zahra, MD, Chief of Endocrinology

Councilmember Ritchie Torres Participates In North Central Bronx Hospital’s Reach out and Read Event, The Bronx Chronicles, NCBH

Standing O is at it again!, Brooklyn Daily, Coney Island: Dr. Jeffrey Goldberg, Chairman of Psychiatry