HM 2016: A Year in Review


From celebrating the 20th anniversary of hospital medicine’s arrival to rapid reimbursement reform to sought-after clarity for observation rules, the past 12 months have been eventful. The Hospitalist asked more than a dozen industry leaders what they thought were the biggest highlights of 2016. Here is what they said:

1. Happy Birthday, HM

August 15 marked the 20th anniversary of “The Emerging Role of ‘Hospitalists’ in the American Health Care System,”1 a New England Journal of Medicine paper authored by Lee Goldman, MD, and Robert Wachter, MD, MHM.2 It was the first time anyone defined what a hospitalist was, putting a sobriquet to an inpatient care model that had organically and independently started happening nationwide.

The paper laid the groundwork for a specialty that spread like a proverbial wildfire over the next 20 years. The model overcame early opposition from residents fearful they’d lose the ability to learn and critical-care specialists who wanted to maintain the caseloads they’d fought to build. The field has now swelled to an estimated 52,000 practitioners.

“I reflect back … and think today about what the hospitalist model brings to us,” James Merlino, MD, president and chief medical officer of Press Ganey’s strategic consulting division, told The Hospitalist. “It is an amazing transformation on how the hospitalist model really delivers.”1

2. Its Own Specialty Code

Hospitalist medicine received federal approval for its first dedicated specialty code3 in a decision hailed by many. The code, approved by the Centers for Medicare & Medicaid Services (CMS), should allow hospitalist-specific billing in 2017.

SHM leaders have long pushed for the code, particularly as healthcare transitions from fee-for-service (FFS) to quality-based payment models. Public Policy Committee Chair Ron Greeno, MD, MHM, says that a dedicated code is necessary to ensure that hospitalists are properly reimbursed for their work.

Historically, hospitalists have used codes more in line with the workload of general internal medicine, family medicine, and other specialties. But those codes don’t account for the complexity of what hospitalists deal with on a daily basis.

“We as hospitalists face unique challenges and work with patients from all demographics, often with severe illnesses, making it nearly impossible to rely on benchmarks used for these other specialties,” Dr. Greeno said.3

SHM pushed for the change and has said it is committed to educating members about how best to use it. Scott Sears, MD, FHM, CPE, MBA, chief clinical officer for Sound Physicians of Tacoma, Wash., said the move is great for HM but that more needs to be done to tailor billing and coding to the specialty’s actual workflow.

“A pediatric hospitalist may not want to be compared to an adult hospitalist. A critical-access hospitalist doesn’t want to be compared to a hospitalist in a tertiary academic medical center,” Dr. Sears said. “I don’t think it’s an end-all, be-all, but it’s a place to start.”3

3. Down with SGR, Long Live MACRA

While it’s unlikely hospitalists have that printed on bumper stickers, 2016 brought the end of the oft-maligned Sustainable Growth Rate (SGR) formula. This was the first year under the Medicare Access and CHIP Reauthorization Act of 2015, better known as MACRA.4

MACRA changes the ways hospitalists and other physicians are reimbursed by Medicare by continuing the broader trend of moving from volume-based reimbursements toward a value-based payment (VBP) system. Its two tracks for physicians to change how they get paid are the Merit-Based Incentive Payment System (MIPS) and the Alternative Payments Model (APM).

MIPS probably looks familiar because it is similar to the traditional FFS model. But to make value a more important factor in the reimbursement formula, MIPS will account for both volume and quality. APM allows physicians to opt out of MIPS by participating in other approved programs where providers take on “more than nominal” financial risk, report on their quality measures, and use certified electronic health record (EHR) technology.

4. The Surgeon General Is a Hospitalist

Any specialty’s annual meeting would be lucky to get the U.S. Surgeon General as a plenary speaker, but HM16 featured one of its own in hospitalist and U.S. Surgeon General Vivek Murthy, MD, MBA.

Dr. Murthy kicked off the confab in San Diego, and some 4,000 hospitalists listened to one of their own talk about ascending the highest perch a physician can attain in the federal government.7 Dr. Murthy, previously a hospitalist at Brigham and Women’s Hospital in Boston, was confirmed as the 19th Surgeon General in December 2014.

In an address titled “Bringing Health to America,” Dr. Murthy inspired with tales of hope and encouraged hospitalists to make the pursuit of healthy appealing while improving the safety of our communities. In particular, he suggested hospitalists look to leverage their leadership to improve systems and to be a powerful force of change both inside the walls of their institution and in their communities.

“In the end, the world gets better when people choose to come together to make it better,” he said.8

5. Nurse Practitioner Joins SHM Board of Directors

At HM16, Tracy Cardin, ACNP-BC, SFHM, was the first nurse practitioner (NP) or physician assistant (PA) given voting privileges on the society’s oversight panel.

“I can’t describe to you how passionately I believe that [NPs and PAs] have a huge role moving forward,” Cardin said. “I think our representation, our visibility, has sort of been flabby and kind of under the wire for a long time. We can really impact the design of care models at the bedside in a way that’s innovative and more efficient and in a way that’s really huge. I think there’s a transformation that’s going to be coming, and we’re going to be a huge part of it.”9

With Cardin’s ascension, it has added the voice of another constituency to its board. She was previously chair of SHM’s Nurse Practitioner/Physician Assistant Committee and in 2015 received the society’s Award in Excellence in Hospital Medicine for NPs and PAs. She has been at the University of Chicago for about 10 years.

“It does send a message to the rest of our membership that SHM values those other constituencies and that this is not a physician membership organization but rather a membership organization comprised of people who are interested in improving healthcare for our hospitalized patients,” immediate past president Robert Harrington Jr., MD, SFHM said.10

6. The State of Hospital Medicine Is Strong

According to the biennial 2016 State of Hospital Medicine Report6 from SHM and partially populated by data from the Medical Group Management Association (MGMA), median compensation for adult hospitalists rose 10% to $278,746 from 2013 to 2015. The double-digit increase continues the steady climb of hospitalist pay, which is up 30% since 2010. At the same time, productivity is flattening.

And nearly all HM groups (HMGs)—96%—are still getting financial support, mostly from their host hospitals, in addition to their professional fee revenue. However, that median support, $157,535 per full-time employee (FTE), increased just 1%.

The slowing growth in that contribution is a harbinger that the level of financial support can no longer grow unabated, said Leslie Flores, MHA, a partner in Nelson Flores Hospital Medicine Consultants and a member of SHM’s Practice Analysis Committee.

“We’re pretty close to that breaking point,” she said. “When we go around the country and do consulting work, we are hearing many more hospital leaders telling us, ‘We’re concerned about how much money this program is costing us, and we are getting to the point where we can’t afford it.’”6

7. Pay Cut for ‘Two-Midnight’ Rule for Observations Is No More

CMS announced a proposed rule in April that would have Medicare stop imposing an inpatient payment cut to hospitals under the “two-midnight” rule, according to a report in Modern Healthcare.10 The final rule went into effect in October.

The rule, which continues to be a contentious issue for hospitalists even with the pay cut being eliminated, was put in place in October 2013 to define which Medicare beneficiary hospital stays are appropriate for Medicare Part A payment by stating that if the physician expected the patient to stay for fewer than two midnights, then the services should be billed as outpatient (Medicare Part B) and not inpatient.

For two years, the only exception to the pay withhold was for those diagnoses that CMS designated as “inpatient only.” An overhaul of the rule in October 2015 stated that exceptions could be determined by the physician (or other practitioner) on a “case-by-case basis.”

But a legal challenge and withering criticism from SHM and other professional organizations prompted CMS to undo the withheld payments associated rule.11–13 In fact, hospitals also will see a one-time increase of 0.6% in fiscal 2017, making up for the 0.2% reduction to the rates of the last three years. SHM has said it will continue to advocate for further changes to the rule.

8. Medicaid Expansion Takes Hold

Thirty-one states and the District of Columbia, under the auspices of the Affordable Care Act, have expanded Medicaid. One 2014 study in states including Minnesota, Kentucky, and Arizona showed a dramatic decrease in uninsured hospital stays and a significant increase in Medicaid stays. Meanwhile, in six states that did not expand, including Florida, Georgia, and Missouri, there was no significant change in payor mix.14

“What a lot of these early studies are saying is that when you expand Medicaid, people get on Medicaid, and that’s exactly what you hope will happen when you do a major public coverage expansion,” said Sayeh Nikpay, PhD, MPH, assistant professor of health policy at Vanderbilt University School of Medicine in Nashville, Tenn., and a lead author of the 2014 Health Affairs study. “Physicians are grappling with payment issues, and it should be quite a relief that people are coming in the door with some kind of insurance rather than uninsured.”15

While expansion from 2015 to 2016 was the main story for Medicaid, many observers are now watching to see what President-elect Donald Trump will do. As a candidate, he campaigned to repeal Obamacare, and that may have significant impacts on the expansion of Medicaid.

9. Antimicrobial Stewardship Rules Upgrade

In July, The Joint Commission announced a new Medication Management (MM) standard for hospitals, critical-access hospitals, and nursing care centers that goes into effect in 2017.16,17 Its stated purpose is to improve quality and patient safety. The Joint Commission move came a year after President Barack Obama made combatting antibiotic-resistant bacteria a national issue.

“If you review the scientific literature, it will indicate that we’re in crisis mode right now because of this,” said Kelly Podgorny, DNP, MS, CPHQ, RN, project director at The Joint Commission. 16

The standard encourages the prioritization of establishing antimicrobial stewardship programs. It suggests staff members at institutions receive training and education on dispensing, administering, and monitoring antimicrobial resistance and antimicrobial stewardship practice. And, in turn, those staffers should look to educate patients and caregivers on appropriate use of antimicrobial medications.

Lastly, when possible, an antimicrobial team should take a multidisciplinary approach and include an infectious disease physician, a pharmacist, and a practitioner.

10. Febrile-Infant Care Draws a Crowd

One of the most well-attended sessions at 2016 Pediatric Hospital Medicine in Chicago was an update on the anticipated American Academy of Pediatricians (AAP) guidelines for febrile infants.18

The guidelines, for infants 7–90 days old, are aimed at providing pediatric hospitalists and others evidence-based guidelines, not rules, from the most recent literature available. The PHM16 session, presented by Kenneth Roberts, MD, highlighted the need to separate individual components of serious bacterial infections such as urinary tract infections (UTIs), bacteremia, and meningitis. Dr. Roberts noted that the incidence and clinical course can vary greatly for the different diagnoses.

The new criteria would be for full-term infants (37–43 weeks’ gestation) who are well-appearing and present with a temperature of 38°C. Exclusion criteria would include perinatal/prenatal/neonatal maternal fever, infection, or antimicrobial treatment; the presence of any evident infection; being technology-dependent; and the presence of congenital anomalies.

In particular, the new guidelines will look to risk-stratify management by age groups of 7–28 days, 29–60 days, and 61–90 days. The criteria are expected to be released in the next year.

Richard Quinn is a freelance writer in New Jersey.


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  2. Wachter M, Goldman L. The emerging role of “hospitalists” in the American health care system. N Engl J Med. 1996;335:514-517.
  3. Tyrrell KA. New hospitalist billing code should benefit hospitalists, patients. The Hospitalist website. Accessed November 14, 2016.
  4. Doctoroff L, Dutta S. MACRA provides new direction for U.S. healthcare. The Hospitalist website. Accessed November 14, 2016.
  5. Quinn R. Everything you need to know about the Bundled Payments for Care Improvement Initiative. The Hospitalist website. Accessed November 14, 2016.
  6. Quinn R. The state of hospital medicine is strong. The Hospitalist website. Accessed November 14, 2016.
  7. Scheurer D. U.S. surgeon general encourages hospitalists to remain hopeful, motivated. The Hospitalist website. Accessed November 14, 2016.
  8. Collins TR. HM16 speakers focus on public health, leadership, future of hospital medicine. The Hospitalist website. Accessed November 14, 2016.
  9. Quinn R. SHM seats its first non-physician board member. The Hospitalist website. Accessed at November 14, 2016.
  10. Carris J. Centers for Medicare & Medicaid Services (CMS) eliminates two-midnight rule’s inpatient payment cuts: report. The Hospitalist website. Accessed November 14, 2016.
  11. Schencker L. Judge tells HHS to revisit two-midnight rule’s inpatient pay cut. Healh Affairs website. Accessed November 14, 2016.
  12. Tyrrell KA. Physicians critical of proposed changes to Medicare’s two-midnight rule. The Hospitalist website. Accessed November 14, 2016.
  13. Tyrrell KA. Ann Sheehy, MD, MS, FHM, outlines to lawmakers hospitalist concerns about two-midnight rule, Medicare policies. The Hospitalist website. Accessed November 14, 2016.
  14. Nikpay S, Buchmueller T, Levy HG. Affordable Care Act Medicaid expansion reduced uninsured hospital stays in 2014. Health Aff (Millwood). 2016;35(1):106-110.
  15. Tyrrell KA. Benefits of Medicaid expansion for hospitalists. The Hospitalist website. Accessed November 14, 2016.
  16. Bopp S. New standard announced for antimicrobial stewardship. The Hospitalist website. Accessed November 14, 2016.
  17. Prepublication standards – new antimicrobial stewardship standard. The Joint Commission website. Accessed November 14, 2016.
  18. 18. DeZure C. PHM16: the new AAP clinical practice guideline on evaluating, managing febrile infants. The Hospitalist website. Accessed November 14, 2016.

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