Company news

September 16, 2013

By year end, the St. Vincent Health hospital system will spin off its New Hope organization for Hoosiers with development disabilities. St. Vincent New Hope will become a stand-alone organization that will continue to run group homes for its patients. New Hope started offering counseling, day programs and residential housing in 1978. About a decade later, St. Vincent joined forces with New Hope. St. Vincent Health will make a cash infusion to New Hope and also donate to New Hope more than 38 central Indiana group home properties. Jim Van Dyke, executive director of St.Vincent New Hope, said in a prepared statement, “This new phase in our history will allow us to implement even stronger programs that will enable New Hope to continue serving our clients well into the future.”

Major health insurers, including WellPoint Inc., are in line for another year of growth, thanks to Obamacare, according to Bloomberg News. Bloomberg cited Barclays Capital analyst Joshua Raskin, who in a research note late last week said the Medicaid expansion funded by Obamacare should help drive enrollment growth next year, and the health insurance exchanges in each state will wind up being a "very small" influence. WellPoint shares rose 57 cents Monday morning to $89.66 each.

Admissions at Indiana University Health hospitals in the first half of the year dipped 4.3 percent, prompting IU Health executives to give pink slips to about 800 employees, according to an announcement Thursday morning. Meanwhile, however, IU Health's business is stronger than ever, with income from operations shooting up nearly 20 percent in the first half of the year.IU Health currently has 36,000 employees, although many of them work part time. Its full-time-equivalent work force totals 27,000. For all of 2012, IU Health had revenue of $5.6 billion. IU Health’s decision comes less than three months after Indianapolis-based St. Vincent Health laid off 865 workers in late June, which was part of a 5,000-worker layoff by its parent organization, St. Louis-based Ascension Health Alliance. IU Health CEO Dan Evans said in an April interview that the hospital system is trying to cut $1 billion in expenses by 2017. So far, IU Health has been able to offset its decline in hospital admissions with an 8-percent price increase and by receiving more patient visits to its outpatient facilities. Excluding one-time items, IU Health income from operations rose 19 percent in the first half of 2013 compared to the same period in 2012. IU Health pulled in $186.3 million during those six months, compared with $156.6 million the year before. Inpatient admissions—those involving an overnight stay—had been climbing consistently throughout 2012. But then, in January, they started to fall.

Indiana University is cutting about 50 hourly workers at its Bloomington campus and shifting that work to a temporary staffing agency. Spokesman Mark Land said the move was in the works, but was accelerated so IU could avoid having to add those workers to the IU health insurance plan as required by the federal health care overhaul if they average more than 30 hours a week. Land told The Herald-Times that shifting 50 of the physical plant department's 650 jobs will also relieve the administrative task of managing the hours of seasonal workers. IU will have the Manpower agency hire the maintenance and custodial personnel after Sept. 28. The university will pay the agency an administrative fee to manage the workers.

Indianapolis-based Eli Lilly and Co. sued Canada last week, seeking $500 million in damages because the drugmaker thinks Canada’s courts violated the North American Free Trade Agreement by invalidating patents on two Lilly drugs. According to CBC News, Lilly had sought relief from Canada through arbitration, but will now take its complaint before a three-member tribunal. Lilly is suing because Canadian courts struck down some of its patents on its former bestseller Zyprexa, an antipsychotic medication, and on Strattera, a medicine to treat attention-deficit hyperactivity disorder. Lilly says the court rulings, issues from 2009 to 2011, cost Lilly hundreds of millions in sales because they allowed cheaper generic versions of the drugs to undercut Lilly’s brand-name products sooner than would have otherwise occurred. "Patent decisions in Canada over the last decade not only fly in the face of long-established international standards, but they're subjective and completely unpredictable," Doug Norman, general patent counsel for Eli Lilly, said in a prepared statement.

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