Adam Rubenfire: Hello and welcome. I’m Adam Rubenfire, Modern Healthcare’s Custom Content Strategist and it is my pleasure to introduce you to Reimagining Care: Strategies for Resilience, a four-part video series sponsored by Hall Render. In each video, healthcare leaders will discuss best practices for overcoming COVID-19 challenges and offer strategies to prepare for uncertainty ahead.
Adam Rubenfire: Today’s video, Part One: Reimagining Care, will offer a broad overview of what’s ahead, highlighting key priorities that leaders must consider as they mitigate the pandemic’s impact on operations, finance, supply chain and compliance, among other key areas.
Adam Rubenfire: We’d like to thank our sponsor for this series, Hall Render. As the nation’s largest healthcare-focused law firm, Hall Render is distinguished by its knowledge, experience and understanding of the evolving landscape of today’s healthcare environment. Hall Render has represented the industry in general and special counsel matters.
Adam Rubenfire: Now I’m thrilled to introduce our guests for today, John Ryan and Ritu Kaur Cooper. John Ryan is the President and Managing Partner of Hall Render. While today he serves in a management role, he still practices employment law and focuses on counseling hospitals, health systems and physician practices. From time to time, he is involved in high-profile investigations into complaints and compliance issues on behalf of clients. He also regularly consults with health care entities on strategies to optimize the structure of their in-house legal departments in order to most cost-effectively deliver the highest quality in health care legal services.
Adam Rubenfire: Ritu Kaur Cooper is a shareholder in Hall Render’s health section. Serving as a co-leader of the firm’s compliance service line, Ritu’s practice consists of representing health care providers such as hospitals and health systems in litigation, regulatory and compliance matters with particular focus on fraud and abuse, compliance and internal and government investigations, as well as voluntary disclosures. Ritu regularly works with legal and compliance departments to assist clients with the development of effective compliance programs consistent with OIG guidance.
Adam Rubenfire: John, Ritu, thank you so much for joining us today.
John Ryan: Thank you.
Ritu Kaur Cooper: Thank you.
Adam Rubenfire: Well, let’s get started. So now we’re halfway through the year, and we’re in the thick of the coronavirus pandemic. What is the overall impact you’ve seen on health systems? How have priorities changed and how is your work with clients shifting? John, let’s start with you please.
John Ryan: Thanks, Adam and thank you for the partnership with Modern Healthcare. We really appreciate covering this important topic and reimagining care. If I would quantify the impact on healthcare to date and hospitals and health systems probably would do it in two ways.
John Ryan: First is the human impact. Certainly, we’ve seen by the numbers. Three million cases in the U.S. Over 130,000 deaths. And even more particular to hospitals and health systems, over 1,000 workers in healthcare that have perished through this pandemic. And it’s personal. My sister is an OB-GYN in Chicago. She’s on the front lines. And so everybody knows somebody that’s been affected by this.
John Ryan: Then the second dimension that I’d mention is the economic impact. When you hear the American Hospital Association estimating that the losses through the first four months of this pandemic through June were $202 billion. Now they’re estimating an additional $120 billion in additional economic losses at hospitals and health systems through the end of the year. The impact really can’t be overstated. And so when you turn and look at the priority changes of hospitals and health systems, I think at some point this year, everybody in healthcare, hospitals and health systems to be sure, put their strategic plan on the proverbial shelf and turned to one thing and one thing alone and that was survival.
John Ryan: In fact, I participated in a webinar a couple weeks ago when a business scholar talked about the three stages of navigating a social or economic crisis. And these have stuck with me. The first is survival. That’s the first stage and the next stage is stabilize, stability. And then the third stage is moving forward. And where I think we are right now is probably stuck somewhere between survival and stabilize and the really good organizations in healthcare are also turning and looking towards moving forward for the long term at the same time that they’re looking to make sure that they survive to operate tomorrow and even in the shorter term as they look to stabilize.
Adam Rubenfire: Excellent. And Ritu, what about you? What has changed and how is your work with your clients changing as a result of this pandemic?
Ritu Kaur Cooper: Thanks, Adam. I think the way the work has changed falls into the three categories that John just mentioned. Whether a client is in the stabilization stage, or maybe they’re still in survival mode, or if they’re moving forward.
Ritu Kaur Cooper: Our job as lawyers is to listen to our clients, which is what we’ve been trying to do and see their needs. For those of our clients that are in that phase of maybe they’ve stabilized, but they’re still thinking to move forward, they want to get back to business as usual as quickly as possible. So any investigations or matters that we halted in March, they’re starting to come full swing now.
Ritu Kaur Cooper: For some clients though, we might be dealing with a few different folks that are on the investigation team or on the matter team just because of furloughs that have happened. Then you have a group of people that are now trying to figure out how can they find more places to save money. A number of clients are looking at their agreements with physicians and deciding, ‘are there any ways that we can cut costs?’ Do we need to have compensation set at where it is, or are there positions that we can eliminate altogether?
Ritu Kaur Cooper: Of course, with those questions, we’re trying to navigate those very carefully because of fraud and abuse issues. We certainly don’t want our clients to inadvertently suggest that the compensation arrangements with those physicians could trigger Stark or kickback. In fact, we don’t want them to suggest at all that they were never, or they’re not commercially reasonable or for fair market value. So those types of questions are things that are pretty delicate.
Ritu Kaur Cooper: Then we have some clients who just were not hit with COVID patients in the early round, in the spring. So we’re seeing some of those same questions now who now have a spike in their city or in their state where they’re now seeing patients come in through the door, and they’re dealing with some of the same questions that we dealt with in the spring.
Ritu Kaur Cooper: For example, can you use home PPE? What do we do with redeploying some of the personnel that we currently have into places where we now have more COVID patients? What are the ramifications of that? What are the risks? So some things that we are seeing that we may have already answered with some clients we’re now answering.
Ritu Kaur Cooper: Now there’s some clients who definitely took heed from what was going on with New York and the providers in New York. And they were ready when they started to see some spikes with their patient population. But I think the vast majority of our provider clients are looking to move forward. They are talking about how do we look at these short term goals or issues that we’re dealing with and align them with our long term goals?
Ritu Kaur Cooper: Like John said, they put their strategic plan on that proverbial shelf. They’re now taking it off, and they’re saying, okay, well, how do we align our strategic plan with what we’re doing right now? That’s the whole idea of reimagining healthcare. I can’t imagine that there is a provider out there who’s not thinking about, let’s say telemedicine, for example. So a number of waivers as well, that they’re thinking about what is going to be here for the long haul.
Adam Rubenfire: Excellent. And Ritu, we’ll stick with you. What is your assessment of the government’s response to this pandemic? How are your clients reacting to the response and adapting as we move through the challenges of the pandemic?
Ritu Kaur Cooper: Sure. Well, let me take your first question first. There is no doubt that the government has been working hard. I mean, since March they’ve put together waivers. They’ve issued subsidies, tax credits. There has been guidance that has come out from whether it’s the Department of Labor or OSHA or the FDA, CDC. There has been funding opportunities. There’s just been so much that has been coming out of the government. And you could say that it’s been so much so fast.
Ritu Kaur Cooper: There’s been probably a decades worth of regulations that have come out in 60 days. And with that, you can only imagine that there are going to be some problems. They probably didn’t have time to think through all the issues or questions that providers might have, which is why some of our providers are finding it a little bit difficult to navigate the questions that have come towards them.
Ritu Kaur Cooper: The issues that they’re facing because of these waivers and new relaxations that the government has tried to put in place. Now, as you can imagine, the government usually pre-pandemic, if they were going to come out with some kind of waiver, let’s say a CMS Stark waiver, for example. It would be pages and pages of regulation that we would comb through, and we would try to understand. They would give examples, and they would try to answer questions through those examples. Well, instead of seeing those pages and pages of regulation, instead, the Stark waivers were a skinny little paragraph that didn’t really say much. So it has been a monumental task for our clients to try to figure out what did the government mean when they gave a particular waiver.
Ritu Kaur Cooper: A number of our clients have tried to manage the changes from a state level. A number of our clients might be in one or two states or maybe in multiple states, and so they’ve handled the state level. Early on, probably March-ish, we had a couple of clients who reached out to us and said, look, we’re handling the state-level changes, but the federal level changes are coming so quickly we need assistance. So we put together a chart to help manage all of the changes that were coming out from the various agencies within the government, whether it was DOL or FDA or OSHA or CMS. And we’ve been updating it regularly to provide it to clients to help them manage those changes from the federal level.
Ritu Kaur Cooper: So I think that that leads right into how are they adapting. So they’re trying to adapt and react as best as they can. They want to make sure that they’re still meeting the mission of their organization, but still staying compliant. You add to that an issue of, from a compliance perspective, wanting to make sure that you’re transparent throughout the organization. You don’t want any of your employees thinking that now you’ve made some slight adjustments. What might have been pre-COVID in February might’ve looked like you weren’t following the letter of the law, the regulation, but now it’s okay because of these waivers, but all the employees may not know about those waivers.
Ritu Kaur Cooper: So a number of our clients are making sure that they are communicating and training employees throughout the organization. Letting them know that they are looking at waivers. They’re assessing those waivers, and they’re trying to make sure that employees understand that they’re still staying compliant, even though now they might’ve relaxed some of the rules that they used to follow.
Adam Rubenfire: Excellent. Thank you, Ritu. John, I’ll go to you next. As health systems respond to this ongoing crisis, as all of our readers are, what actions should they immediately be taking to ensure financial stability?
John Ryan: I guess that’s the million-dollar question or for some organizations, the multibillion-dollar question. We represent about 1,500 hospitals across the country, and we’ve worked with them enough now over the last couple of months to get a pretty good read on where the priorities lie relative to financial stability. I would probably put them into three categories though there are many more that we could dive into, but the three priorities that we see more frequently.
John Ryan: One, our hospital clients are taking advantage of all governmental funding options. And they’re complicated. There’s a lot of detail in eligibility and the strings attached to those dollars. But the Advanced Payment Program, the economic relief afforded under the Carers Act, some FEMA programs.
John Ryan: For some of the smaller hospitals, critical access hospitals, in particular, you’re seeing opportunities to apply for PPP money through the SBA. And even some hospitals are taking a fresh look at their entire reimbursement status, not so much related to COVID though. I’m sure that that’s been a motivating factor, but we’ve been surprised at the number of hospitals who take a fresh look at the reimbursement status, just in terms of Medicare and Medicaid reimbursement. Taking advantage of millions of dollars in reimbursement just based on that status that they were leaving on the table before this pandemic happened. And so that’s another opportunity for our hospital clients.
John Ryan: Beyond governmental funding, we’re seeing a lot of activity in reviewing Managed Care agreements. There are any number of regulations that have changed that have moved the ball and afford opportunities to renegotiate those Managed Care agreements. Changes in provider credentialing. In licensure. And if you think about it, even on a broader sense, the proliferation of telemedicine in making sure that some of the opportunities for reimbursement in telemedicine are taken full advantage of in the private payer market as well.
John Ryan: Then the third thing that I mentioned is I think everybody’s scrambling with respect to cash management and cash enhancement strategies. Financing, refinancing opportunities, talking with your banks and your lenders with respect to a revision to the debt covenants that you have in your loan agreements, to the extent that you have those. And then coming up with creative ways to monetize your non-cash assets. We’ve seen a number of institutions that we represent and beyond, you’ve read the headlines, that talk about cash reserves depleting, and any one of those three priorities that I just mentioned could offer some opportunity to establish that financial stability during this time of crisis.
Adam Rubenfire: Excellent. And John, you mentioned telemedicine and I want to jump on that. Telemedicine has absolutely, as social distancing has been required, telemedicine has absolutely transformed our healthcare world. We know that organizations with significant virtual care abilities will be better positioned to serve their communities and secure revenue. So Ritu, how should leaders be assessing new opportunities in this area both from a reimbursement perspective and an operations perspective?
Ritu Kaur Cooper: Thanks, Adam. Well, first off, you’re right. Telemedicine, I feel like overnight it became less complicated and more common. I think just 12 months ago, I was dealing with questions with clients where we’re trying to grapple with, okay, well, what state law do we look at? And now it’s here. And I think it’s important to know that not only is it here, it probably isn’t going anywhere. Even when it’s not needed, it’ll probably be wanted. I certainly would love to not sit in a waiting room at a hospital or a physician’s office and just get a ping on my phone to say they’re ready for me.
Ritu Kaur Cooper: So from a reimbursement perspective, I think we need to see where CMS will take this. Before you wouldn’t get reimbursed for a service unless the patient traveled to a location like a hospital or a physician’s office for that telemedicine to work. You had to be at a site, a telemedicine site. Now physicians can be at home. Patients can be at home. But with that, OCR also had to make some exceptions as well. So they had to allow people to be able to use FaceTime or Zoom or Teams to be able to have that interaction occur. So I think that we need to make sure that we see what is it that CMS says and how OCR reacts to it to determine the future of how we’ll be reimbursed.
Ritu Kaur Cooper: I think from an operations perspective though, we need to make sure that our providers are thinking about the most cost-effective way that they can provide telemedicine. It needs to be scalable. It needs to be easy. Using FaceTime, using Zoom, using Teams. Maybe in February that might’ve been difficult for some, but I think today Zoom and Teams is commonplace. So we need to make sure that they’re thinking about those issues.
Ritu Kaur Cooper: The other thing is they need to figure out how telemedicine is going to fit within their current plan. There could be state licensing issues. There might be med staff membership that they need to look at and looking at bylaws. Quality assurance, they’re going to have to monitor that. So once CMS comes up with what it looks like going forward, which word on the street is it’s not going anywhere. Telemedicine is here to stay.
Ritu Kaur Cooper: I think another thing providers really need to think about is there are probably tons of technology companies that want to jump on the bandwagon, and they want to now try to provide a solution to providers, whether it’s at home monitoring or providing a platform. So some providers might put together their platform on their own, and some of them may partner with another organization. So our provider clients definitely need to think about vetting those technology companies that they may choose to partner with and make sure that if they’re new to the industry and new to the market, that they still are thinking about HIPAA Privacy and security compliance.
Adam Rubenfire: Excellent. Thank you, Ritu. John, whether you are a large health system, a small rural hospital, patient surges have just incredibly challenged the health systems in our nation over the past few months. I’m wondering how you’re advising your clients to prepare for these kinds of operational anomalies in the future even after we take care of COVID, still, there are all kinds of things that can create surges. So I’m wondering what should clients be considering when it comes to workforce, supply chain and care delivery issues so that they can address patient surges and ensure that they’re mitigating risk and frankly, serving patients in a way that is going to lead to high quality?
John Ryan: Thanks, Adam. In my mind, it’s hard to imagine reimagining healthcare without addressing the two single largest operating expenses of your organization in the form of workforce and supply chain. And taking workforce first, I think about it in two different ways. One, I think there’s been a huge increase in discussion around workplace safety. That’s been highlighted by this pandemic. And I think that will continue. It’s not a new issue. In fact, for the hospitals and health systems that have collective bargaining units and negotiate collective bargaining agreements with unions workforce or workplace safety is a top issue in those negotiations every time you negotiate agreements. But I think again, this pandemic has elevated the attention to be paid towards workplace safety.
John Ryan: Second dimension of workforce considerations that I think should be top of mind as we consider the future is rightsizing your workforce. It used to be that reductions in force were a best practice in managing to a better bottom line. And more recently, it probably was a best practice with respect to accommodating the reductions or the slower increases in reimbursement rates.
John Ryan: But as we sit here today, a workforce reduction, a reduction in force or a furlough may be the deciding factor in whether or not your organization survives or not. And if you look further into the future, my sense is that the tension with respect to labor cost is going to continue. And for a future that we really can’t predict today. So it will be incumbent on hospitals and health systems to look for ways to rightsize their workforce and also have in place leaders who are very adept in change management.
John Ryan: And then if you turn the page towards supply chain I’d comment there that the issues… If you think about the strategies of the past, it was very tied towards exclusive vendor agreements to achieve preferential pricing, and also just-in-time inventory to minimize waste and keep expense down. But the pandemic has worked to exploit the inherent risk in those two strategies, because what happens when your exclusive vendor doesn’t have enough supply to service your organization. And what if you don’t have enough supply in your inventory to manage through an unforeseen uptick in the need for that supply?
John Ryan: So we see a lot of clients right now focusing on ways to build some flexibility into their supply chain agreements and also considering spot stockpiling strategies relative to certain supplies that you know would be in desperate need in a situation like we have today. PPP being a really good example.
Adam Rubenfire: Excellent. Well, thank you for that. And John, we’ll go back to you for another question. It’s inevitable that some litigation may arise during this challenging time for health systems. What should leaders be focusing on in their efforts to proactively mitigate that kind of risk and how should they strategize for the legal threats that are going to come?
John Ryan: Again, it’s a timely question although we probably are just scratching the surface on what it’s going to look like. I started my practice in litigation and employment litigation, and litigation 101 tells you that there’s always an uptick in litigation after a social or economic crisis. And so you know that we’re on the verge of an uptick in litigation based on the present day. You add to that the fact that our courts, particularly in commercial litigation, have been largely closed over these last couple of months, just reopening now in many ways. And we’ve really created a bit of a litigation powder keg that our clients, hospitals and health systems, physician practices should be preparing for.
John Ryan: When you look at the types of litigation that we could experience, I think first off you know that there’s going to be an uptick in qui tam and whistleblower litigation. So much money has been pumped into the healthcare industry. Some would say, not enough, but enough money has been pumped into the healthcare industry that odds are there are going to be people who believe that those monies have been obtained through false pretext. So qui tam and whistleblowers is going to be a big area of litigation buildup I expect in the near term.
John Ryan: Another area would be contract disputes. Corners have been cut. Rules have changed. And there are a lot of people that are angry and/or desperate. It’s very common in an economic or a social crisis. And so you’re going to see an uptick in contract disputes. Supply chain contracts, IT vendor agreements, employment agreements, physician employment agreements, you’ll see an uptick in contract disputes there.
John Ryan: And then I think you’re also going to see an uptick as we often do in the traditional employment litigation because we will have had a number of people that have lost their jobs through this and also professional liability. So I think that there are going to be any number of risks that are our hospital and healthcare clients will have to navigate, but I probably would, in terms of your question around mitigating it, I probably would turn it to Ritu because she’s our resident expert on compliance and managing that risk.
Adam Rubenfire: What a great transition. Ritu, with your expertise in compliance, please let us know, how can our readers prepare for these compliance-related risks and mitigate the potential risks?
Ritu Kaur Cooper: Thanks, Adam. And thanks, John. I guess that 20 I slipped you was worthwhile. No, but seriously, I think the vital role of compliance in helping to mitigate risk can not be overlooked. It’s the job of compliance, right? If you think about the seven elements of an effective compliance program. You deal with auditing, monitoring, hotline calls, transparency, education. All of that comes from compliance and so a key here is making sure that compliance is at the table. As leadership is deciding to take advantage of any of the relaxations or waivers that are coming out of the government. Whether it’s taking advantage of a subsidy or taking advantage of a relaxation of the conditions of participation, or for example, a Stark waiver.
Ritu Kaur Cooper: So if the organization keeps compliance at the forefront, then compliance can figure out what their role is. Perhaps they should be auditing and monitoring to make sure that the modifications that we are taking advantage of as providers are not then crossing the boundary. The other could be just monitoring to make sure that we see when those expirations might occur. Some of these waivers are only in place as long as the PHE’s in place. So if it’s not in a public health crisis, then we might have to shut things down. And so if compliance is involved then compliance can help unwind some of those arrangements and relaxations that we’ve put into place.
Ritu Kaur Cooper: And then last but not least, John touched on this in terms of employees and whistleblowers: transparency is key. Disgruntled employees lead to individuals who want to file suit and want to file whistleblower issues. So perhaps compliance can act as a telephone. Not only should they be educating the employees on the relaxations that the organization has taken advantage of that are coming out of the government and that they’re doing it in a compliant manner, but also then communicate back to leadership of any issues that are coming up through their compliance hotline or calls that they’re getting related to employees maybe not feeling comfortable with all the changes that are occurring.
Adam Rubenfire: Sure. Well, great. Ritu, we’ll stick with you for our closing question. And John, I’ll let you have the last word. Ritu, looking to the horizon, as much uncertainty as there may be during this time, could you briefly tell us what should health systems be tackling today and what should they have their eyes on for farther into the future as we reel from in the next few years as a result of this pandemic?
Ritu Kaur Cooper: Sure. Thanks, Adam. I think I’m going to stick with my last point. I think organizations really need to figure out how to deal and utilize compliance and legal to the best of their ability. A number of organizations had to furlough individuals and a number of individuals from compliance and legal departments were part of that furlough population. So I think organizations should not skimp on their compliance resources now. This is not the time. We need to figure out how to make sure compliance is being best utilized and to make sure that we have an effective compliance program in place.
Ritu Kaur Cooper: In terms of legal, I think legal gets a bad rep. I just did a presentation last week for AHLA where my co-presenter who’s in-house counsel and I joked that throughout the organization, people feel that good ideas go to die in the legal department. Legal is working really hard, and they are trying to understand all of these waivers that are coming in. All of the rules and regulations that we need to make sure that providers are following so that they can stay compliant, but still stay true to their mission. So I really think organizations should make sure that they use compliance and legal in an effective way. I think that also they need to make sure that they are looking at intentional action informed by diverse perspectives. I think that’s going to lead to the best results.
Adam Rubenfire: Excellent. John, will you close this out? What should leaders be thinking about tomorrow and for the next years?
John Ryan: Thanks, Adam. Couple of things. One I’d make a subtle plug for the second, third and fourth installments, because of this presentation that we’ve only been really able to scratch the surface on so many different topics. And I think that you’ll be able to get a better sense of some of the particulars in the next installment of the series.
John Ryan: The other thing that comes to mind is just 101 business planning. I think back to that mantra I shared with you at the outset about survival, stabilizing and moving forward. And I think it would be really easy for an organization to stall in survival or stability mode and not also be thinking about moving forward.
John Ryan: And then a final thought would be that we can’t ignore the number of other social issues that are top of mind in our society right now. As much as the pandemic is front and center for so many hospitals and health systems, we can’t ignore the issues of racial justice and care equity that are so important to our health system as well.
John Ryan: We’re rooting for you. We’re here for you. And I think together we can work together to make a better U.S. health system. Thanks, Adam.
Adam Rubenfire: Excellent. Well, thank you so much. That brings us to the end of our conversation. Thank you again to John and Ritu for joining us for this awesome conversation and thank you to our sponsor Hall Render. To learn more about Hall Render, please visit hallrender.com. To our audience, thank you so much for joining us. John did the pitch for you already, but stay tuned for our next video, which will focus on financial strategies to overcome COVID-19. Have a great day.