Scott M. Frisch

Regulators think they are doing good. The outcome, however, is generally the opposite of the intent. The 3.48 hours per resident day staffing rule has just been finalized for nursing homes. This will have the effect of shutting down single-entity non-profits captained by local or religiously affiliated boards who do not have the resources and also rural communities (who will use the exemption until it burns off). As such, there will be less supply of care while the demand for it is only increasing which will probably put a higher burden on emergency care sourced at acute care hospitals. https://lnkd.in/eA5TxQDU

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This article aims to shed light on the critical aspects of fee transparency so plan sponsors can best help the plan but also relay relevant details to participants. https://ow.ly/XnbQ50RspwI

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A few weeks ago I spoke with the value-based care lead at a prominent West Coast PE firm. He made two Freudian slips: 1) Replacement of the term "Consumer Health" with "Commercial Health", and 2) Naming Patients as "one important stakeholder," instead of "THE CRITICAL stakeholder in healthcare." So, I'm not surprised to see CA AB-3129: Calling out Private Equity and Hedge Fund M&A, especially those with health insurance portfolios. I'm seeing several funds boosting their insur-tech positions and few innovative, patient-centric value props. [If you have one, let's talk!] Existing CA law requires that healthcare providers share transaction agreements with the Office of Health Care Affordability. This new Bill introduces a 90-day notice and written consent from the Attorney General before PE/HF transact with non-profit healthcare providers in CA. Three conditions apply for a possible waiver by the Attorney General: 1) Costs exceed revenue for 3 or more years, AND 2) Provider is unable to pay its debts, AND 3) the transaction will ensure continued access to care for the affected population. Those conditions look like the beginning of a beautiful thesis for state roll-ups. It is unclear whether this Bill only applies to non-profit provider systems. Nevertheless, I appreciate the explicit statement that, even after buyout, the financial sponsor is blocked from interfering with clinical care decisions. Given analogies to payor influence on clinical care, it may be a tough point to patrol.

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We spend a lot of time thinking about how funders approach financial due diligence. In our work with clients an initial question is "Does your financial due diligence process align with your values and purpose?" Read our recent article, written by John Summers and Radhika Shah, to discover insights from a landscape analysis of funder processes. A key takeway: A central component common to each funder in the study, is the goal to “get to yes.” As we delve into how AI might enhance the financial due diligence process, it is crucial to address key qustions about values and purpose and to critically evaluate any AI driven analysis. #AI #financialduediligence #philanthropy #nonprofitfinance

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🚨 Steward Health CEO Skips Rare Congressional Hearing Amid Financial Turmoil 🚨 📉 Key Highlights: * Ralph de la Torre, CEO of Steward Health Care, has defied a Senate subpoena for testimony. * The Senate Committee on Health, Education, Labor, and Pensions is investigating Steward’s financial collapse and alleged poor care, hospital closures, and state bailouts. * De la Torre’s Position: Claims that appearing could jeopardize ongoing bankruptcy proceedings and a legal settlement critical for keeping hospitals open and preserving jobs. 🔍 What’s Happening: * Hearing Focus: The committee will hear from local officials and nurses instead. The crisis at Steward has drawn criticism from both Republican and Democrat lawmakers. * Senator Ed Markey’s Statement: Accuses executives of “looting hospitals” and demands accountability. 👥 Past Congressional Testimonies: * CEOs from Johnson & Johnson, Merck & Co., and Boeing Co. have previously testified about their companies’ issues. * De la Torre’s Argument: His testimony could impact ongoing bankruptcy proceedings and settlement deals. 🏥 Financial and Operational Struggles: * Steward’s bankruptcy is attributed to a drop in patient visits during the pandemic, rising labor costs, and inadequate government reimbursements. * Massachusetts Involvement: State committed nearly $500 million to keep Steward hospitals open and transition them to new ownership. * Critical Incidents: Unpaid bills led to equipment repossession at a Boston hospital, affecting patient care. 💰 Private Equity and Financial Controversies: * Cerberus Capital Management: Owned Steward from 2010 to 2020, profiting about $800 million. The 2016 sale-leaseback deal with Medical Properties Trust, Inc. is criticized for excessive rent obligations. * Post-Buyout: Steward issued over $100 million in dividends, including $11 million to Medical Properties Trust Inc. 📜 Legislative Response: * Lawmakers are pushing for increased oversight of private equity in health care, with California and Massachusetts considering reforms and stricter penalties for financial mismanagement. 💬 Looking Forward: The controversy surrounding Steward Health underscores the need for greater transparency and accountability in private equity-backed health systems. https://lnkd.in/g9FxESBp

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Appreciate the article Howard Gleckman. Medicaid LTSS varies significantly by state. Many have strong HCBS systems in place while others remain greatly dependent on FFS and facility care. It does make sense to allow individuals "on the path" to Medicaid eligibility to have early access to the program to enable a smooth transition. Perhaps a cost sharing approach may work. Many states already have such programs in place and do delay reliance on Medicaid. Still, the need continues to encourage middle-income families to plan for their LTC needs with affordable products that capture them upstream from the Medicaid pond. This should be the goal of any state or federal reform proposal, to reduce the burden on Medicaid by reducing the cost to provide and the need for care.

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As I’ve gone deeper into the topic of wealth inequality, a critical question that keeps emerging is: what are strategies for sustainably financing community ownership and steward ownership models? Well, Common Trust and Purpose Foundation (US) have given us a nuanced set of case studies and a powerful set of recommendations in response! 📚💥🤯 Their new book -- Assets in Common -- powerfully illustrates how interconnected enterprises can not only foster economic resilience but also generate shared upside and provide a viable alternative to the extractive economy. 🌍💰 Definitely worth a read! https://lnkd.in/eZQUkrKG #WealthInequality #CommunityOwnership #StewardOwnership #AssetsInCommon #EconomicResilience

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We talk a lot about fiduciary duty for organizations, but what are we doing to support the financial health and wellness of nonprofit employees? Please read this piece... It's an issue that needs to be addressed across the sector.

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