Healthcare Groups Preparing for Changes This Year

Change is in store for the Valley’s healthcare scene in the New Year. At Health Net, there will be a shift in leadership as the company attempts to rebound from a rocky 2008. On the legislative front, orders are in place to implement a law designed to extend Medi-Cal coverage to HIV-positive Californians. And at Valley hospitals, not only does renovation continue, but there is also an effort underway to ensure that cash-strapped residents don’t forgo medical care in light of the economic downturn. On a lighter note, local hospitals transitioned into the New Year by celebrating the last births of 2008 and the first births of 2009. There’s a shakeup in process with the management of Health Net. Late last year, the board of the Woodland Hills-based company announced that President and CEO Jay Gellert would focus his efforts solely on the company’s strategy, specifically concentrating on how best to deploy the company’s assets during a period of economic decline. Meanwhile, James Woys, chief operating officer, is assuming responsibility for Health Net’s commercial, Medicare and Medicaid lines of business, as well as its Government and Specialty Division, in addition to all company administrative functions. Rounding out the management changes is Stephen Lynch, president of the company’s Health Plan Division. On Feb. 28, Lynch will retire. According to Health Net’s board chair Roger Greaves, the changes in management resulted from concerns the company’s board has about its recent financial performance. “We believe that by refocusing management resources, we can address our challenges with greater intensity,” Greaves stated. For the third quarter of 2008, Health Net announced a net income of $18.5 million, or 0.17 per diluted share. For the third quarter of last year, Health Net reported 0.93 per diluted share. The third quarter 2008 figures reflect a $17.1 million pretax charge for severance and other expenses related to the company’s operations strategy and a $14.6 million pretax charge for impairment of the company’s investment holdings because of adversity in the financial markets. “We are disappointed by our third quarter results,” Gellert stated. “Our business and the market as a whole have been hit harder by the economy and related unit cost and utilization trends than we have experienced in the past. We are now assuming that these trends will continue into 2009.” As Health Net’s board developed a strategy to improve its financial performance, Health Net Federal Services LLC, the government operations division of Health Net Inc., celebrated winning six awards for its health education materials and Web resources from the Health Information Resource Center. The HIRC is a national clearinghouse which recognizes the best consumer health information materials and resources from healthcare organizations across the nation via its National Health Information and World Wide Web Health Awards. Nearly 1,000 entries were judged on content, format, effectiveness and overall quality by a panel of international health information and Internet experts, according to Health Net. Health Net was honored in the category of health promotion/disease and injury prevention information. “We are very proud that our materials have been recognized once again as some of the best in the health care industry,” stated Steve Tough, president of Health Net Federal Services. AIDS Legislation In late December, AIDS healthcare activists emerged victorious when the Superior Court of California, County of Los Angeles, entered a judgment ordering California’s Department of Health Care Services (DHCS) to implement a 2002 law which aims to extend Medi-Cal coverage to HIV-positive Californians. Before the legislation was signed, only those whose infections had progressed to AIDS were eligible for Medi-Cal enrollment and coverage. According to AIDS Healthcare Foundation, the bill had been introduced twice before former Gov. Gray Davis signed the legislation in 2002. Different versions of the bill had been proposed by California legislators as far back as 1997. The bill reportedly honored a campaign pledge Davis made during his first California gubernatorial campaign. Early last month, the court ruled that DHCS had failed to meet its statutory duties with regard to the legislation. In the judgment, the court orders the state to perform a series of measures, including conducting outreach efforts to encourage those disabled by AIDS to voluntarily enroll in Medi-Cal; determining how much money would be saved by more AIDS-disabled people voluntarily enrolling in Medi-Cal; establishing capitation rates to be paid to Medi-Cal for services; and seeking the appropriate federal waiver to implement the expansion of AIDS survivors eligible for Medi-Cal. “We thank the court for this judgment which compels the state to do its job by implementing this important legislation passed by the state’s representative government and signed into law by the Governor,” stated Michael Weinstein, president of AIDS Healthcare Foundation. Healthcare Warning As the New Year begins and the economic downturn continues, representatives of Henry Mayo Newhall Memorial Hospital in Valencia urge the public not to put off getting needed care. “When people defer care, conditions usually tend to worsen,” stated Dr. Mark Sender, Hospital Chief of Staff. “It is far better, and in the long run cheaper, to catch health issues early on, before they turn into a long-range debilitating condition, such as heart attack, stroke or uncontrollable malignancy.” In particular, the hospital is warning the public not to forgo mammograms, colonoscopies, flu shots, childhood immunizations and blood pressure and cholesterol checks. Moreover, pregnant women are urged not to skip pre-natal visits, and seniors are urged not to cut back on needed prescriptions. The Henry Mayo staff reminds everyone of the importance of having an annual physical. Henry Mayo representatives cite an increase in unemployment and the related consequence of much of the public going without health insurance as the reason for its concern. A poll conducted by the Kaiser Family Foundation indicates that the economic downturn could be playing a role in whether the public keeps up with healthcare needs. The poll found that the number of respondents who said that they or a family member had put off needed care had gone up to 36 percent in October, up from 29 percent in April. What’s more, almost one-third of respondents also reported skipping a recommended test or treatment, up 24 percent from six months earlier. One-fifth of respondents said that their conditions had worsened as a result of forgoing needed tests or treatments. “There is a real and legitimate fear that people may try to cut corners and skip their annual cancer screenings this year, such as mammography, because of the recession,” stated Dr. Gregory Senofsky, medical director of Henry Mayo’s Breast Center. Senofsky is also a clinical faculty member of the surgical oncology department of the University of California, Los Angeles, and author of the Patient’s Guide to Outstanding Breast Cancer Care. Chief of Staff Sender believes that employers can play a role in keeping its workforce healthy. “Employers need to focus on preventative care for their workforce and make sure that they don’t put off such things as screenings and annual physicals,” Sender stated. “In the long run, nutrition education, screenings for high blood pressure and cholesterol checks are relatively low-cost in comparison with treating the health crisis that can result when bad lifestyle habits go unchecked.” Henry Mayo is celebrating the overhaul of its second floor Maternity Services Family Waiting Room, which made its debut Dec. 23. The renovation of the waiting room was made possible due to contributions from Dave Davis Plastering Inc. and H & S; Electric Inc. Changes made to the waiting room include new carpet, furniture and a large flat-screen television. Last and First In related news, Antelope Valley Hospital in Lancaster recently celebrated its last birth (and tax deduction) of 2008 and its first birth of 2009. More than 6,000 babies are born annually in the Women and Infants Pavilion of the hospital. H & R; Block presented the last baby born at the hospital in 2008 with a gift, and Antelope Valley Hospital presented the first baby born in 2009 with a gift basket.