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ACAView: New Findings On The Effect Of Coverage Expansion Since January 2014


July 9th, 2014

Editor’s note: In addition to Josh Gray, Iyue Sung also coauthored this post. 

Together, athenahealth and the Robert Wood Johnson Foundation (RWJF) have undertaken a new joint venture called ACAView, as part of the foundation’s Reform by the Numbers project, a source for timely and unique data on the impact of health reform.

The goal of ACAView is to provide current, non-partisan measurement and analysis on how coverage expansion under the Affordable Care Act (ACA) is affecting the day-to-day practice of medicine. athenahealth provides a single-instance, cloud-based software platform to a national provider base.

Any information that our clients enter using our software is immediately aggregated into centrally hosted databases, providing us with timely visibility into patient characteristics, clinical activities, and practice economics at medical groups around the country.

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New Health Affairs July Issue: The Impact Of Big Data On Health Care


July 8th, 2014

Health Affairs explores the promise of big data in improving health care effectiveness and efficiency in its July issue. Many articles examine the potential of approaches such as predictive analytics and address the unavoidable privacy implications of collecting, storing, and interpreting massive amounts of health information.

Big data can yield big savings, if they are used in the right ways.

David W. Bates of the Brigham and Women’s Hospital and coauthors analyze six use cases with strong opportunities for cost savings: high-cost patients; readmissions; triage; decompensation (when a patient’s condition worsens); adverse events; and treatment optimization when a disease affects multiple organ systems.

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Call For Papers: Care Of Older Adults


June 27th, 2014

Health Affairs encourages submissions from authors on topics surrounding the care of older adults, including new models of care and the management of multiple chronic conditions among this population. We are interested in work that spans the full range of care settings, including primary care and specialty practices, hospitals, nursing homes and other long-term care settings.

In addition to exploring topics that are directly related to the provision of care, we also welcome papers on a broad array of related dimensions that affect care, access, and affordability, such as financing models, coverage, and size and composition of the workforce. We are grateful to The John A. Hartford Foundation for providing support for our ongoing coverage of these topics.

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Behind The Numbers: Slight Rise In Health Care Spending Growth Projected


June 24th, 2014

PwC’s Health Research Institute (HRI) released its ninth annual Medical Cost Trend: Behind the Numbers report today. This forward-looking report is based on interviews with industry executives, health policy experts, and health plan actuaries whose companies cover a combined 93 million members. Findings from PwC’s Health and Well-being Touchstone Survey of 1,200 employers from 35 industries are also included.

HRI projects that after a five-year contraction in spending growth in the employer-sponsored market, the growth rate will rise to 6.8 percent in 2015, up from the 6.5 percent projected last year.

What are the biggest drivers of the growth in health care costs? We identify four cost inflators in this report, and I would like to highlight two. First, the economy. More than five years after the end of the Great Recession, the improved economy is finally translating into greater medical spending. Consumers are now addressing health issues they ignored or postponed previously.

Secondly, the high cost of specialty drugs. While only four percent of patients use specialty drugs, those medications account for 25 percent of total U.S. drug spending. And estimates are that U.S. specialty drug spending will quadruple by 2020

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Thoughts On The VA Scandal And The Future


June 13th, 2014

For eight years, until May 2013, I directed the Department of Veterans Affairs (VA) medical research program from its Central Office and became familiar with the operations of the Veterans Health Administration (VHA). It was my only VA job and I felt honored to be part of the VA’s vital mission, as did most VA employees I met. Based on this experience, I have some ground level observations on the state of the VA and its future planning in light of the present scandal.

VA’s Scope and Assets

VA has three components: a large health system (VHA), a benefit center (Veterans Benefits Administration, or VBA), and the highly regarded National Cemetery Administration. All report to the VA Secretary but have different missions, issues, and management requisites. For example VHA was a pioneer in the Electronic Health Record (EHR), while VBA has had a more recent painful conversion to information technology (IT). VHA is run by the Undersecretary for Health, on whom VA Secretaries almost totally rely given their general lack of experience in health care.

VHA is divided into 21 networks and has 8.9 million enrollees (out of the 22 million U.S. veterans). It cares for 6.4 million veterans annually at over 1,700 sites of care, including 152 hospitals, about 820 clinics, 130 long-term care facilities, 300 Vet Centers for readjustment problems, and a suicide hotline, as well as homelessness and other programs. It has partly trained two-thirds of U.S physicians and made groundbreaking medical research contributions. These assets create strong constituencies for VA both within and outside the veterans’ community.

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How Much Market Power Do Hospital Systems Have?


June 12th, 2014

Sometimes big game hunters find frustration when their prey moves by the time they’ve lined up to blast it. That certainly appears to be the case with the health policy target de jour: whether providers, hospital systems in particular, exert too much market power. A recent cluster of papers in Health Affairs and policy conferences this spring have targeted the question of whether hospital mergers have contributed to inflation in health costs, and what to do about them.

Hospitals’ market power appears to be one of those frustrating moving targets. The past eighteen months have seen a spate of hospital industry layoffs by market-leading institutions, and also a string of terrible earnings releases from some of the most powerful hospital systems and “integrated delivery networks” in the country. These mediocre operating results raise questions about how much market power big hospital systems and IDNs do, in fact, exert.

The two systems everyone points to as poster children for excessive market power-California-based Sutter Health and Boston’s Partners Healthcare, both released abysmal operating results in April. Mighty Partners reported a paltry $3 million in operating income on $2.7 billion in revenues in their second (winter) quarter of FY14. Partners cited a 4.5 percent reduction in admissions and a 1.6 percent decline in outpatient visits as main drivers. Captive health insurance losses dragged down Partners’ patient care results.

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Changing Provider Networks In Marketplace Health Plans: Balancing Affordability And Access To Quality Care


June 11th, 2014

Editor’s note: In addition to Sabrina Corlette, JoAnn Volk, Robert Berenson, and Judy Feder coauthored this post. 

Twelve percent of the complaints to California’s Department of Managed Health Care this year relate to access to care problems. In New Hampshire, consumers were upset to learn that their local hospital had been excluded from the network of the sole insurance company participating on the state’s health insurance marketplace. In reaction to concerns about narrowing networks, legislators in Mississippi and North Dakota considered “any willing provider” legislation this year.

But at the same time, the Congressional Budget Office expects narrow networks to help reduce marketplace costs by billions of dollars. Network configurations clearly offer consumers a cost-access trade-off. Narrowing networks is by no means a new trend – using network design to constrain providers’ price demands has long predated the Affordable Care Act (ACA). In the new marketplaces, insurers are using narrow networks to help keep premiums low for price-sensitive purchasers. But if a plan’s low premium reflects limited network access, its policyholders might not only face compromised quality care but unanticipated and potentially crippling financial liabilities.

Regulators are recognizing this trade-off and reconsidering network standards at the state and federal level. But regulators face a challenge: If they overly constrain insurers’ ability to negotiate with providers, consumers could face significant premium increases. On the other hand, if they ignore provider participation issues, consumers will lack confidence that there is a sufficient network to deliver the benefits promised without posing financial or quality risks.

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The Latest Health Wonk Review


June 10th, 2014

Joe Paduda offers the latest edition of the Health Wonk Review at Managed Care Matters. Joe is “not taking any time off” and covers the latest in health policy blogging, including a trio of Health Affairs Blog posts.

Joe features HA Blog posts by Bob Berenson and Stu Guterman on provider consolidation and market power in health care; these posts were written in response to a Health Affairs Web First package on the same topic. Joe also includes Amy Berman’s post on being diagnosed with terminal cancer and choosing palliative care, written in response to the May Narrative Matters essay by Diane Meier.

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When ICD-10 Implementation Becomes A Game


June 9th, 2014

Editor’s note: For more on this topic, stay tuned for the upcoming Health Policy Brief update on transitioning to ICD-10. 

The on again, off again plans for ICD-10 code set implementation leaves many organizations at a crossroads. In a previous blog post, we discussed the details of ICD-10 and assessed the industry’s readiness for implementation.  This assessment assumed the improbability of a further delay.  In February, CMS Administrator Marilyn Tavenner had seemingly given the green light, declaring, “There are no more delays and the system will go live on October 1.”

However, at the end of March 2014 Congress passed another temporary delay of Medicare physician reimbursement rate cuts that also included language unexpected to many — including CMS — that ICD-10 would be delayed until October of 2015.  Given this latest development, ICD-10 implementation has begun to feel like a high stakes game of the childhood pastime, “Red Light, Green Light,”  in which players must run forward at full speed, until the words ‘red light’ are called out with no warning, forcing them to stop on a dime.  In this case, countless organizations and institutions may be feeling a little disoriented by the latest change.

Some entities are grateful. Congress’s “red light” gives them extra time to prepare.  A February 2014 survey of over 570 physician group practices conducted by the Medical Group Management Association revealed that a large number of providers aren’t ready for the transition to ICD-10.  The survey showed that:

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Making Markets Work In Health Care: What Does That Mean?


June 3rd, 2014

Editor’s note: See Robert Berenson’s post on consolidation and market power in health care, also published today, and watch for more on these subjects in Health Affairs Blog.

Health Affairs last week posted a set of papers that represent several perspectives on Provider Consolidation in Health Care: Challenges and Solutions. To provide a context for these papers and for the broader discussion of how to make markets work in health care, I suggest a couple of thoughts.

There are two types of markets in health care: the market for health services and the market for health coverage—these markets are interrelated, and both of them are broken.

The historical correlation between provider concentration and both higher prices and lower quality is well-documented. With the increased focus under health reform on collaboration across providers and settings, and the increase in physician and hospital consolidation and the purchase of physician practices by hospitals, the concern is that this trend may lead to adverse consequences for the health system.

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Acknowledging The Elephant: Moving Market Power And Prices To The Center Of Health Policy


June 3rd, 2014

Editor’s note: See Stuart Guterman’s post on consolidation and market power in health care, also published today, and watch for more on these subjects in Health Affairs Blog.

Health Affairs recently published a set of papers addressing the problem of provider consolidation and consequent increased prices. Perhaps even more striking than the specific arguments made in these papers is the very fact that smart and busy people other than antitrust economists and lawyers now are actually spending a great deal of their professional time thinking about this problem. High prices and the distortions in markets resulting from differential pricing power have been the unacknowledged elephant in the policy room for decades, even as the policy community and policy makers have wrung their hands over what to do about rising health care costs. More than 40 years ago, President Nixon declared that health care spending increases were “unsustainable.” And here we still are grappling with health care spending.

Over the decades I have been told by smart health economists that the main culprit behind increasing health spending is technology, although the definition of technology turns out to be pretty flexible — new ways of providing care are considered new technology, not just machines and drugs. And nominees for the reason our baseline spending exceeds other countries’ by so much have included administrative complexity in our multi-payer, crazy quilt organization of health care; defensive medicine caused by malpractice concerns; and fraud and abuse. Jack Wennberg and colleagues at Dartmouth have argued that variations in service use that do not increase quality explain spending variations, at least in Medicare where payment (price) variations are not permitted other than to reflect differences in input costs.

All of these explanations have merit, but for non-government payers, prices have actually been the main source of high spending and variations in spending, at least in the recent past and probably for much longer. Prices for commercial and self-funded insurance products result from market negotiations between insurers and providers; the balance of power in these negotiations has sometimes shifted, most recently toward many providers, but certainly not all of them — the relatively few remaining independent hospitals and the solo and small physician practices have become “price takers,” even as other providers are able to negotiate payment rates far higher than Medicare benchmarks.

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Chinese Doctors In Crisis: Discontented And In Danger


May 27th, 2014

Chinese doctors are unhappy about their pay and work conditions.  Moreover, they are in danger of physical attack by angry patients and families.  The Ministry of Health estimated that in 2010, 17,243 attack and agitation incidents occurred in Chinese hospitals, an increase of almost 7,000 over five years. Patients, bereaved families of patients who have died in hospitals, and sometimes paid protestors called yinao or “medical troublemakers,” invade hospitals, berate or attack staff, create loud disruptions, and stage mock funerals.

About 30 percent of the attacks were carried out by patients, 60 percent by family members, and the remainder by others, including yinao. About 75 percent of attacks were aimed at doctors.  According to a 2012 survey of nearly 6,000 Chinese physicians in 3,300 hospitals, 59 percent of doctors had been verbally assaulted and 6 percent had been physically assaulted. News accounts for 2002-2011 yielded 124 incidents of “serious violence” against hospitals, including 29 murders and 52 serious injuries. Often violence accompanies demands for cash compensation for harm to patients, including patient deaths in hospitals.

In response, the Chinese Ministry of Public Security has recently announced a new set of security measures for hospitals. Approximately one thousand top-tier hospitals will now have a police presence in addition to their own security guards; alarm systems linked with local law enforcement; enhanced audio-visual surveillance systems; and security posts at entrances similar to those at airports.

The wave of violent attacks on doctors and other medical workers constitutes a significant problem in its own right.  But it is also a reflection of a broader set of problems faced by today’s generation of Chinese doctors.  They are badly paid, both in relation to doctors in other countries, and in relation to other Chinese professionals. As a result, doctors often supplement their low salaries in ways that strengthen the popular impression that they are corrupt, fostering still greater distrust and anger among their patients and patients’ families. A recent survey showed that 67 percent of the Chinese public does not trust doctors’ professional diagnoses and treatment.

The doctors themselves are also dissatisfied with the current state of affairs. A 2011 Chinese Medical Association survey of its members showed fewer than 20 percent of responding doctors to be satisfied with their medical practice environments, while 48 percent rated them “poor” or “very poor”. Doctors were particularly dissatisfied with their pay. They were also concerned about their work conditions.

When respondents were asked to identify sources of work pressure, the most frequent response, at 77 percent, was “high patient expectations.”  Only 21 percent wanted their own children to become doctors. Interestingly, this survey showed that fewer than 10 percent of respondents blamed patients, doctors, or hospitals for their problems; the majority (83 percent) blamed “the system” for the tension between doctors and patients.

In this post, we review that system and highlight sources of doctors’ discontent and the distrust between doctors and patients.

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Implementing Health Reform: Third-Party Payments And Reference Pricing


May 22nd, 2014

On May 21, Secretary Sebelius released a letter providing a further clarification of what has become a rather muddled policy regarding the ability of third parties to pay for premiums and cost-sharing for qualified health plans (QHPs). The issue was first raised on October 31, 2013; Secretary Sebelius stated in a letter to Congressman Jim McDermott (D-WA) that QHPs were not federal health care programs and thus presumably were not subject to the anti-kickback laws, which generally prohibit payments by providers for business. The letter raised the possibility that hospitals or other providers could pay premiums for QHP enrollees, thus keeping them insured and the hospitals’ bills covered. This possibility was attractive to hospitals, which could often at minimal expense help high-cost, low-income patients cover their hospital bills through health insurance.

HHS quickly attempted to shut down this possibility though a November 4, 2013 Frequently Asked Questions document encouraging insurers not to accept premium payments from hospitals or other health care providers or commercial entities, and expressing a fear that such payments could distort the risk pool. CMS did not clarify on what authority it was discouraging such payments.

This FAQ, however, was seized on by insurers to refuse to take any premium payments from third parties. On February 7, 2014, therefore, CMS issued yet another FAQ clarifying that the earlier FAQ did not bar payments by Ryan White programs, Indian organizations, or private charitable foundations.

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Health Affairs Web Firsts: Provider Consolidation In Health Care


May 19th, 2014

The clinical and economic virtues of provider consolidation have long been recognized by policy experts, but in recent years, research has shown that large provider organizations may use market power to obtain relatively high prices from payers without necessarily delivering superior quality. Four articles, being released as Web Firsts by Health Affairs, examine the issue from diverse perspectives.

A study from Paul Ginsburg and Gregory Pawlson serves as an issue overview. With continued consolidation likely, the article examines strategies that purchasers and payers can pursue to combat the rising prices that may result from growing provider leverage.

Ginsburg is the Norman Topping/National Medical Enterprises Chair in Medicine and Public Policy at the Sol Price School of Public Policy and the Leonard D. Schaeffer Center for Health Policy and Economics, University of Southern California in Los Angeles; Pawlson is a senior medical consultant at the law firm Stevens and Lee in Lancaster, Pennsylvania.

“The success of the private- and public-sector initiatives,” they conclude, “will determine whether governments shift from supporting competition to directly regulating payment rates.”

Looking broadly at the drivers of competitive outcomes, a study from William Sage, the James R. Dougherty Chair for Faculty Excellence, School of Law at the University of Texas at Austin suggests that the health care system’s long history of regulation and subsidy has not only distorted prices but has also altered the nature of the products that the system buys and sells.

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Reminder: Health Affairs May 19 Event On Provider Consolidation In Health Care


May 15th, 2014

The clinical and economic virtues of provider consolidation have long been recognized by policy experts, but in recent years, research has shown that large provider organizations may use market power to obtain relatively high prices from payers without necessarily delivering superior quality. On May 19, Health Affairs will release a package of “Web First” papers examining questions regarding provider consolidation.

We invite you to a Health Affairs Briefing at the National Press Club in Washington, DC, where the authors will discuss their findings and engage in a discussion with a panel of expert responders and the audience. The papers and the briefing are supported by a generous grant from The Commonwealth Fund.

When:
Monday, May 19, 2014
9:00 a.m. – 10:30 a.m.

Where:
National Press Club
529 14th Street NW
Washington, DC 13th Floor (Metro Center)

REGISTER NOW!

Follow live Tweets from the briefing at @HA_Events, and join in the conversation with #HA_ProviderConsolidation.

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Measuring Patient Satisfaction: A Bridge Between Patient And Physician Perceptions Of Care


May 9th, 2014

Patient satisfaction is at the core of patient centered medicine. Improved patient satisfaction not only leads to an enhanced patient experience—something every sick or injured patient deserves—it is also associated with improved treatment outcomes. In 2008, researchers demonstrated that improved patient satisfaction was correlated with higher quality hospital care “for all…conditions measured.” More recent work has begun to identify exactly how this correlation works. For example, higher patient satisfaction has been associated with reduced readmission rates. Furthermore, improved patient satisfaction has even been correlated with reduced inpatient mortality, “suggesting that patients are good discriminators of the type of care they receive.”

Despite the correlation between higher patient satisfaction rates and improved outcomes, measurement of patient satisfaction remains controversial among many health care providers. Physicians, in particular, often chafe when organizations, such as The Commonwealth Fund through their site WhyNotTheBest, or the Centers for Medicare and Medicaid Services though their Physician Compare website, begin to publicly report doctors’ patient satisfaction data. Additionally, employed physicians often fret when patient satisfaction is included in their reimbursement metrics.

Certainly there are instances in which sound medicine may lead to a lower rate of patient satisfaction; infrequently, satisfaction can correlate, not with high quality care, but with the fulfillment of patients’ a priori wishes for their treatment. A good example of this problem is the difficulty in refusing to fill narcotics prescriptions and steering a patient toward alternative pain relief modalities when the physician has good evidence that a patient has a problem with narcotics abuse. While the doctor in this example is practicing good medicine, it is highly unlikely that the patient will leave the office anything other than deeply disappointed.

Despite these relatively rare cases, many studies show a deep chasm between how patients and doctors view medical care, and thus demonstrate the need to measure patient satisfaction rates. Patients and their doctors can view the same episodes of care quite differently so, without patient satisfaction measures, we are left with an incomplete or even misleading picture of patient care.

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An Extraordinary Opportunity: Hospital Community Benefits


May 8th, 2014

Editor’s note: In addition to John O’Brien, this post is coauthored by Rob Restuccia.

You wouldn’t know it from the chorus of critics, but health reform represents an exciting opportunity for America’s hospitals. We believe this can be a seminal moment for hospitals and communities to come together to build a more sustainable health system and to improve the health and quality of life in our communities.

We are two individuals from differing vantage points: a long-serving health care CEO and a lifelong health advocate CEO who have worked together for more than 25 years. We are fortunate to have had the chance to see over time what has worked and what hasn’t, both locally and nationally. And yes, we are both from Massachusetts.

Many people are tired of hearing about health reform in Massachusetts, either due to sheer frequency, disbelief that it works as claimed, or skepticism that even what does work in Massachusetts will work elsewhere. Understood. However, by many measures it has been a success. As almost all know, elements of it were borrowed for the Affordable Care Act (ACA), and one longstanding element in particular – a strong community benefit expectation – is where we think the nation’s hospitals have an extraordinary opportunity.

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Is Non-Profit Hospital Community Benefit Equally Distributed Across States?


May 8th, 2014

Editor’s note: In addition to David Kindig, this post is also coauthored by Erik Bakken.

In a recent Health Affairs Blog post, Sara Rosenbaum, Amber Rieke, and Maureen Byrnes discuss how IRS Community Benefit expenditures might be better directed to community building and community health improvement activities instead of primarily being reported as unreimbursed Medicaid expenditures. They cite an estimate from the Northwest Health Foundation “…that were hospitals to shift 20 percent of their community benefit expenditures toward community health improvement efforts, the annual yield would be $2.2 billion in additional funds for prevention…”

This is a significant amount of money. In a similar recent analysis for Wisconsin non-profit hospitals, we estimated the following alternative: a minimum 10 percent of total community benefit would be mandated toward the community health improvement category, with an increasing 2 percent obligation for each 2.5 percent increase in hospital profitability for any hospital over 2.5 percent profitability, up to a maximum of 20 percent profitability.

This scenario would more than triple the amount of community health improvement spending through community benefit provision, from $46 million to $139 million, or 13 percent of total community benefit. We presented this model as just one modest example of the amount of revenue that could be derived from such a regulation, and encourage the development of other scenarios or policy alternatives such as alternative modeling approaches varying the minimum or increasing profitability percentage scenarios.

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Health Affairs May 19 Event: Provider Consolidation In Health Care


May 8th, 2014

The clinical and economic virtues of provider consolidation have long been recognized by policy experts, but in recent years, research has shown that large provider organizations may use market power to obtain relatively high prices from payers without necessarily delivering superior quality. On May 19, Health Affairs will release a package of “Web First” papers examining the issue from various perspectives.

We invite you to a Health Affairs Briefing at the National Press Club in Washington, DC, at which we will release the papers and where the authors will discuss their findings and  engage in a high-level discussion of the issues with a panel of expert responders and the audience.  The papers and the briefing are supported by a generous grant from The Commonwealth Fund.

When:
Monday, May 19, 2014
9:00 a.m. – 10:30 a.m.

Where:
National Press Club
529 14th Street NW
Washington, DC 13th Floor (Metro Center)

REGISTER NOW!

Follow live Tweets from the briefing at @HA_Events, and join in the conversation with #HA_Hospital_Consolidation.

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Reminder: Health Affairs Briefing On US Hospitals And The Standardization Of Care


May 6th, 2014

Hospital organizational form, practices, and procedures all affect outcomes and costs. These topics and the exploration of cost-saving potential within the hospital sector were the subject of a National Bureau of Economic Research conference held last fall. The May 2014 issue of Health Affairs“US Hospitals: Responding To An Uncertain Environment,” features four of the papers presented at that conference, as well as several other papers that take up issues surrounding the financial health of hospitals and outcomes for the populations they serve.

Please join Health Affairs Founding Editor John Iglehart on Wednesday, May 7, at the National Press Club in Washington, D.C., for a Health Affairs briefing marking the release of the May issue where the authors will present their work.

WHEN:
Wednesday, May 7, 2014
10:00 a.m. – Noon

WHERE:
National Press Club
529 14th Street NW
Washington, DC  13th Floor (Metro Center)

REGISTER NOW!

Follow live Tweets from the briefing @HA_Events, and join in the conversation with the hashtag #HA_HospitalProductivity.

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