Has your practice implemented a compliance program or considered improving an existing one? Is it really necessary? Prior to the Patient Protection and Affordable Care Act (ACA), the necessity for physician practices to develop compliance plans was merely voluntary. However, the ACA will now require physician practices to have a fraud and abuse compliance plan in place as a condition of continuing to participate in Medicare or Medicaid programs. Because the government first published guidelines in the year 2000 for the voluntary use of compliance plans in physician practices and has subsequently enacted a mandate in the ACA for compliance plans, many physician practices are proactively implementing them. While this compliance plan mandate may be viewed by physicians as yet another administrative burden and expense to the practice, it can have many benefits as well. Implementing an effective compliance program can have the result of not only reducing liability risks, but can also allow a practice to reap monetary benefits. In fact, it could be more costly for the practice not to have one! Continue reading
Hanging this nation’s cost cutting/quality enhancing hopes on Accountable Care Organizations (ACOs) is bound to be frustrating and disappointing. The ACO model seriously lacks sufficient real world grounding and is no magic pill. Things like resources, operational capability and alignment (of financial incentives and direction) seem to have been overlooked or undervalued.
The ACO model is based on one fundamental assumption: an expanded role of primary care physicians can slow cost increases and ensure better coordination of care. That assumption is flawed for two reasons: first, there is a large and growing primary care shortage; and second, the financial incentives in healthcare have driven a system based on acute, episodic interactions, leading to enormously fragmented clinical training and care.
We not only have inadequate resources to drive change away from acute, fee for services based care, but rather we lack resources that drive wellness. As one physician with a large hospital system recently said: “We physicians are not trained to provide healthcare. We’re trained to intervene when things go bad.” Asking healthcare professionals and facilities to drive a model based on outcomes and resource consumption is theoretically possible, but a remarkable leap of faith (and training) is required, given they have made their livings off of sick people for so long. That’s not to say that changing financial incentives from acuity to wellness and outcomes won’t work. It’s just going to require training and proof that the players can make money with the new mandates.
As far as operations go, those with the greatest access to management, capital, IT and such are also the most expensive—hospitals. It makes sense that the core objective of healthcare reform is to “squeeze the toothpaste tube” backwards from hospital to specialist to primary care physicians, but it’s a great leap of faith to expect that hospitals will or even can control costs. In a healthcare system where providers admittedly are rewarded for doing more with more expensive things, the sharp turn required by the new law will require more than just a new law. With all the current hospital-driven physician acquisitions, the increasing role of hospitals on the ACO issue looks at times more like turf guarding than any real cost-saving, quality enhancing move.
At the end of the day, all players have to answer the question “Did they reduce cost and enhance quality?” It seems convincing that moving away from the fee for service model will change behavior. We just need to make sure (1) there are sufficient resources to implement the change, and (2) financial and clinical issues are well balanced. Time will tell, but meanwhile the current irony is that the most expensive link in the chain is best situated to actually operationalize the ACO concept.
Alignment is critical. Financial alignment will require the players to believe they can all thrive in the new ACO model, yet physicians are historically leery of any hospital driven system. In fact, given that hospitals are driving the ACO bus at the moment, the biggest fear among physicians is that they will be left out. Even among physician-driven ACOs, the tension between primary care physicians and specialists is intense. How much of any savings will go to primaries vs. specialists is no less divisive than the issue of the hospital/physician split of the shared savings.
Even more critical is the apparent lack of consideration given to the need for patient participation. Where is the financial incentive for healthy patient choices and the disincentive for unhealthy patient choices? Moreover, in a culture where more is more, why would anyone want to receive care from an organization that gets more by giving less? Given further the ability of patients to wander in and out of ACOs and yet charge their ACO with the costs of non-ACO providers (who arguably have no stake at all in reducing expenses), the forecast for patient alignment is gloomy, but their buy in is critical. It is difficult to see where patients have any stake in this change and would even be inclined to choose to be served by an ACO. Many noted theorists have drilled on the glaring lack of patient alignment. Rama Juturu and recent Wall Street Journal editorialists/economist Clayton Christensen have been outspoken about the need to enlist patients in the drive from intervention to prevention. Patients that flock to ACOs (or whatever) will only do so if they see what’s in it for them. The only thing an ACO can sell is results, outcomes. And that’s gonna take time to measure and to sell.
At the end of the day, the threat of ACOs (and any vehicle to control healthcare costs more effectively) isn’t that they won’t work. It’s that cost concerns will outstrip clinical ones. While it can be argued that the employment of physicians by traditionally adverse players (like hospitals) will likely reduce the tension between them, it is precisely that tension that has always held the threat of “money over quality” at bay. What will happen as hospitals and other healthcare players employ more and more physicians? One can only hope that it is not silence and that, as found in some well established systems in the Midwest and West, respect for the different and necessary roles of ensuring both quality and economic survival will balance out, regardless of the healthcare delivery model that emerges.
The Physician Feedback/Value-Based Payment Modifier Program provides comparative performance information to physicians and medical practice groups, as part of Medicare’s efforts to improve the quality and efficiency of medical care. By providing meaningful and actionable information to physicians so they can improve the care they deliver, CMS is moving toward physician reimbursement that rewards value rather than volume.
The Program (which is specific to Fee-For-Service Medicare—not Medicare Advantage) contains two primary components:
- The Physician Quality and Resource Use Reports (QRURs, or sometimes referred to as “the Reports”) Select “QRUR Templates…” option from the menu on the left side of the page
- Development and implementation of a Value-based Payment Modifier (value modifier)
Select “Value-based Payment Modifier” from the options on the left side of the page.
This program supports the transformation of Medicare from a passive payer to an active purchaser of higher quality, more efficient health care through the value-based purchasing (VBP) initiative. Physician feedback reporting was initiated under Section 131 of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), and was expanded by section 3003 of the Affordable Care Act of 2010. The Affordable Care Act directed CMS to provide information to physicians and medical practice groups about the resources used and quality of care provided to their Medicare Fee-For-Service patients, including quantification and comparisons of patterns of resource use/cost among physicians and medical practice groups. Most resource use and quality information in the QRURs is displayed as relative comparisons of performance among similar physicians or groups. Section 3007 of the Affordable Care Act mandated that, by 2015, CMS begin applying a value modifier under the Medicare Physician Fee Schedule (MPFS). Both cost and quality data are to be included in calculating payments for physicians. By 2017, the Value-based Payment Modifier is to be applied to all physicians who bill Medicare for services provided under the physician fee schedule.
“Healthcare Reform,” “PPACA” and “ACOs” all have one certain thing in common: cost-saving change. Though debate swirls about politics, timing and the particulars of change, it seems clear that the changing demographics of our country (aging baby boomers) in our economic climate is not sustainable as is. And it’s no surprise that a compensation system based on how much is done and how much it costs leads to greater expense. An economic reward system that drives costs up as more and more people are set to join the ranks of the insured (through mandated health insurance and expanded Medicaid) simply underscores the timing of the change. What does that mean for physicians?
Physicians are asking three key questions:
- Is there a future for small or solo practices?
- Is fee for service really gonna change?
- What can I do right now to adapt?
The Future of the Small Practice
The only solid answer is “less.” It really depends on complex things like the demographics of where the doctor practices and the number of competitors close by. That said, as change happens, the hardest hit will likely be the smaller practices, since they lack the personnel and financial resources to weather the change and to invest in adaptation. Many small practices will likely experience change in such a way that the best they can hope for is to survive, rather than thrive. Even worse, solo practitioners already know what it’s like to handle all the duties as a physician, keep track of business operations and keep the patients flowing into the practice. Exhausting. Without substantial support and resources, it’s just not realistic for most solos to expect to keep up.
Even larger practices are not often run like a business. The professionals that generate the revenue often manage as well. Moreover, most medical practices do not market or do any serious “back office” magic (revenue cycle management). As such, change hits small practices especially hard. Implementing even new EHR requirements can be consuming for a small practice. How will it be as changes are made to reduce cost and improve quality? How will it be when practices begin to see there is opportunity in change, that they may actually make more money in a risk based compensation environment? Rougher. Like a herd of buffalo when attacked, circling together is a good strategy.
That said, the vision has to be clear. Why circle together? Most medical practices are combining and growing to guard market share, not to manage costs or measure and demonstrate quality. This is probably the biggest reason why we see larger practices in single specialties, not multi-specialty or primary/specialty based practices. Most physicians that are adapting by joining larger practices are doing so for the same reason why buffalos circle together—the threat of change. Though size alone is no panacea, larger practices are definitely in a better position to adapt.
Let’s face it: few are running after change in healthcare right now. Few see the opportunity and are leading the charge. Most are waiting or are just setting the stage. And most large practices are, at best, a good platform where change can be implemented and costs can be shared and spread among a larger pool.
Will There be a Change to Fee for Service Payment?
Yep. Simple as that. It’s already happening. Bundled payments are in place, even in Florida. Capitation is old hat for many now.
When? Over time… Not right away. Even ACOs aspirants are selecting just one sided risk, testing the water as they see how well they do to reduce costs, improve quality and “earn” their right to bonus money. Physicians that think fee for service will thrive for decades are kidding themselves, at least in the insured market. Is there a basis for it in a “second tier” or concierge sort of environment? Probably.
What Can I Do Right Now?
First, accept that we are approaching a new paradigm of healthcare delivery. The current model of disease/injury crisis management has prepared no one for the move from intervention to prevention. And yet, systems that are solidly based in wellness and prevention stand to profit most from the change we all face.
Second, look to shore up you business model. That means:
- Look to join a larger practice that is committed to thriving in the future risk-based compensation scenario. If the practice is there just to thrive in a fee for service environment and has no commitment to thriving in a risk based compensation model, keep looking;
- Market. Most practices do not market at all, and yet consumers are selecting medical care in the most unlikely environment—the internet;
- Look at anything concierge-like. Most of the public conversation centers around the insured market, mostly the Medicare Shared Savings Program (which has spawned the ACO concept). What about the rest of the consumers? As the insured market gets squeezed (remember that consumers are feeling the pressure too with heightened copays, deductibles and benefit limits), you can expect growth of the “second tier,” those who want more and are willing to pay for it;
- Build in wellness and prevention. Not all practices lend themselves to wellness related services that can reduce healthcare costs, but those that do must look at ways to offer cost-saving, wellness and prevention-oriented services;
- Enlist the patients. The concept of “partnering” with patients is strange, but consider the amount of savings and the enhancement of outcomes if physicians could incentivize healthy patient behavior. Though absent from the public policy conversation, health care businesses that build in patient accountability stand to win big in a payment system that rewards clinical outcomes and cost savings.
Change is frightening. Even “good” change is frightening. Just look at all the upset stomach meds sold at airport kiosk counters. Physicians have a terrific burden at this time. They not only hold our health in their hands. They are expected to have skills and time to help create a new environment in which care will be delivered. Denying change in the healthcare sector is a waste of time and energy. Looking for ways to thrive in it and even drive it is wise.
In what is being hailed by some as a big victory for the Obama administration, the U.S. Court of Appeals for the Sixth Circuit June 29th delcared the Patient Protection and Affordable Care Act’s individual mandate provision a valid exercise of congressional authority under the commerce clause (Thomas More Law Center v. Obama, 6th Cir., No. 10-2388, 6/29/11).
The ruling upheld a decision by the U.S. District Court for the Eastern District of Michigan, which refused to enjoin implementation of PPACA after finding the mandate constitutional. The plaintiffs in the case included the Thomas More Law Center, a public interest law firm.
“Today’s ruling is a huge victory for the millions of Americans who are already benefitting from the Affordable Care Act and the millions more who will in the coming years,” according to Eddie Vale, communications director for advocacy group Protect Your Care.