Appropriate Use of Extraordinary Assumptions and Hypothetical Conditions
Recognizing that economic or financial value is forward looking, i.e., "value is the expectation of future benefit," the valuation analyst must, accordingly, project the most realistic, probable benefit to be derived from the ownership of the subject outpatient enterprise in the future. Therefore, the valuation process related to the analysis of the future benefit stream related to the subject outpatient enterprise must rely upon accurate, predictive information. However, due to the nature of the current transactional marketplace involving outpatient enterprises, valuation analysts are required, from time to time, to consider, and disclose, certain underlying assumptions. Additionally, on certain occasions, the valuation analyst may be required to utilize hypothetical conditions and/or extraordinary assumptions in order to be in compliance with the stated valuation standards guiding their work. The second installment of this five-part series on the valuation of healthcare outpatient enterprises discusses hypothetical conditions and extraordinary assumptions and their impact on valuation engagements. (Read more...)

GAO Issues Report on CMS Post-Payment Claims Review
On August 13, 2014, the Government Accountability Office released a report criticizing the handling of post-payment claims reviews by auditors for the Centers for Medicare and Medicaid Services (CMS). The report, entitled, "Medicare Program Integrity: Increased Oversight and Guidance Could Improve Effectiveness and Efficiency of Postpayment Claims Reviews," highlighted specific flaws within CMS's Medicare contractors, a group of private auditing organizations that have recently come under scrutiny from members of Congress and healthcare providers based on allegations of burdensome post-payment review requirements and the resulting financial strain. Utilizing interviews and documentation from CMS officials and representatives from the contractors, the GAO report provided four broad recommendations to CMS to improve the Medicare post-payment claims review process. (Read more...)

Provider Concentration and Antitrust Implications
The first two installments of this three-part Health Capital Topics series on concentration in the healthcare industry focused on the consolidation of health systems and hospital acquisition of insurers. This third and final installment will focus on healthcare provider concentration and associated antitrust implications. The consolidation of healthcare providers has been a growing trend since the passage of the ACA. Partly due to the ACA, which incentivizes quality healthcare, in contrast to the quantity of healthcare services provided, many hospitals are merging with other healthcare systems to create organizations capable of managing population health to better handle the operational needs and expenditures required to meet these goals. Antitrust enforcement has become a common response in efforts to minimize anti-competitive activities in healthcare markets. (Read more...)

Health Insurance Exchange Changes Expected for Enrollment Year 2015
The first three installments of this four-part series on Health Insurance Exchanges explored issues pertinent to beneficiaries and insurers in light of the opening of the Federal Health Insurance Marketplace, as well as other health insurance options, such as Consumer Operated and Oriented Plans (CO-OPs) and Employer Insurance Plans. This fourth and final installment discusses the expected changes for the Health Insurance Exchanges in enrollment year 2015, as well as the issues pertinent to consumers as the November 2014 commencement of the open enrollment period approaches. (Read more...)