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Growth in medical costs tops inflation

The amount of money patients paid for medical care increased more quickly than did the overall inflation rate, according to a Bureau of Labor Statistics report issued Jan. 15.

The Consumer Price Index advanced 2.7% in 2009, primarily driven by increases in the cost of automobiles and gasoline.

The cost of medical care went up 3.4%. Related commodities, such as drugs and equipment, increased 3.3%. Professional services went up 2.5%, but hospital costs rose 7.1%.

Meanwhile, average weekly earnings dipped 1.6%, according to another BLS report issued Jan. 15. The wages of those working in education and health services went down 1.2%.

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Companies barred from selling policies alleged to be insurance

Washington State Insurance Commissioner Mike Kreidler has issued cease-and-desist orders to five companies that were allegedly selling fake health insurance coverage.

The companies -- Serve America Assurance, Smart Data Solutions, American Trade Assn., Real Benefits Assn. and Beema-Pakistan Co. -- are accused of offering what they claim is health insurance for $199 per month for individuals and $369 per month for families. According to the order, none of the companies, which are apparently affiliated, are licensed or registered to sell health insurance in Washington.

The companies also were ordered to turn over a list of customers.

Serve America and Beema-Pakistan have been the subject of cease-and-desist orders from Arkansas, Connecticut, Indiana, Michigan and North Carolina. Oklahoma has fined American Trade Assn. $75,000 for violating a cease-and-desist order in that state.

The companies have denied any wrongdoing and said they are working to resolve any problems.

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CCHIT updates certification rules

The Certification Commission for Health Information Technology has changed its electronic medical record certification requirements to conform to the interim final rule released by the Dept. of Health and Human Services, which defined meaningful use of EMRs.

CCHIT Executive Director Alisa Ray said the two dozen vendors that received certification under the latest program will be offered incremental testing at no cost to "close any gaps."

EMR systems must conform to HHS rules to qualify for the federal incentive program created under the American Recovery and Reinvestment Act.

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Pa. hospital files for bankruptcy

Lower Bucks Hospital in Bristol, Pa., has filed for Chapter 11 bankruptcy protection.

The hospital, which has lost $14 million over the last three years, said its filing was motivated by it missing a $915,000 bond payment on Dec. 15, 2009. The hospital also said its finances have been hurt by an upswing in charity care, from $2 million in 2002 to $12 million in 2009.

The hospital said its 1,000 employees, as well as its patients, should notice no change in operations during the bankruptcy process.

Lower Bucks has tried for three years, without success, to find a potential buyer.

The print version of this content appeared in the Feb 8, 2010 issue of American Medical News.

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