July 25, 2008
Leadership meeting on MGH/CMS project and FY '09 budget

A report on an innovative pilot program conducted in conjunction with Medicare and Medicaid Services (CMS) and the fiscal year (FY) '09 operating budget were the featured topics of a leadership meeting July 22 in the O'Keeffe Auditorium. MGH President Peter L. Slavin, MD, opened the meeting by welcoming managers and supervisors.

Tim Ferris, MD, medical director of the MGPO, described the progress at the midway point of a three-year CMS pilot project called the MGH Care Management Program. The MGH was selected by CMS as a test site for the project, which aims to improve care and reduce costs using a CMS-paid fee for managing some of the MGH's highest risk patients. Care managers work closely with patients, who have agreed to participate, and serve as liaisons to help coordinate their care as advised by the physician. Ferris explained that so far the program appears to be improving clinical outcomes. Both physicians and patients alike have embraced the new system, which also may offer some savings for Medicare. If current trends persist, the program could serve as a model for addressing both high costs of care as well as quality of care for high risk patients. Ferris attributed the program's success to date to the high patient enrollment, the skilled and dedicated care managers, sophisticated information systems at the MGH and a serious commitment to the project by MGH leadership.

The FY '09 budget was the next featured topic at the meeting. Sally Mason Boemer, senior vice president for Finance, explained that while the FY '09 budget process was challenging, thanks to the hard work of managers and department heads, a balanced budget plan has been developed. Mason Boemer explained that the preliminary budget gap was larger than in prior years due to a number of factors, including major payor rates just at or below inflationary levels; research funding concerns related to stagnant funding from the National Institutes of Health; a larger employee base increasing costs for wage and benefit programs; and increased pressures on nonsalary costs, such as utilities and medical supplies. Based on these pressures, departments have absorbed the FY '09 volume growth without new resources and at the same time reducing expenses. Mason Boemer explained that, while addressing these factors, the budget has allowed for some investments in key programs. She concluded by describing volume assumptions for inpatient and outpatient areas and explaining risks and key drivers, as well as net patient revenue assumptions related to payment rates and available reserves. 

Back to table the July 25, 2008 table of contents