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Survey finds physician support for new payment models

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A survey of 500 physicians by Fidelity Investments and the National Business Group on Health (NBGH) found that while only 55 percent of respondents take part in an alternative-payment model now, some 80 percent would consider participating in the future.

The survey suggested that most physicians approve of the the shift away from fee for service. Only 41 percent of physicians surveyed  believed that fee for service was an optimal way to deliver positive patient outcomes. Among physicians under age 35 confidence in fee for service was only 28 percent,

The survey indicated that physicians rank “positive impact on patient health” as the top benefit of alternative payment models.

“At the end of the day, physician buy-in and support are crucial to the success of these new delivery models,” Brian Marcotte, president and CEO of NBGH, said. “We are asking physicians to change how they engage their patients, manage their practice and get paid. The right resources, technology and analytics have to be in place to help physicians make this transition to deliver on the promise of improved patient outcomes and lower costs.”


Chargemaster focus needed in transition to value payments

 

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Jon Melling, a partner and IT consultant at Pivot Point Consulting, spoke with  Becker’s Hospital Review about how hospitals are transitioning from fee-for-service to value-based billing.

“The two [systems] are so fundamentally different that you can’t just flick a switch and move from one to the other,”  noted Mr. Melling, and hospitals and health systems face many challenges in bridging the gap.

The reimbursement that hospitals are getting now has  fallen, in part because of the the rise in popularity of high-deductible health plans, Mr. Melling told Becker’s. “And under value-based billing there is likely to be a further decline in the level of revenue accrued.”

Becker’s noted: “The onus is on hospitals to find other avenues of revenue to mitigate loss, and successfully manage the health of their patient populations in a cost-effective way.”

Becker’s paraphrases Mr. Melling as saying: “To successfully manage their patient populations, providers will need to seriously invest in powerful, quality analytics engines as well as market-particular wellness initiatives, such as requiring mammograms and prostate exams for those over a certain age.”

This financial incentive to better identify and manage at-risk populations has sparked new conversations between insurance plans and care providers. “There is and will be a substantially increased amount of crossover between physician groups, payers and hospitals,” Mr. Melling added.

“If you’re a provider in a network, you have to work very closely with the payer to make sure you’re clear about the parameters and the criteria for care, and come to an agreement about the level of reimbursement for specific conditions, or what the overall payment will be if you are taking on a population,” he said.

As hospitals  navigate between volume and value, Mr. Melling pointed out  core revenue-cycle areas demanding provider attention.

Becker’s summarized his views on this point as: “Hospitals will need to pay increased attention to their chargemaster, potentially managing separate chargemasters where one cannot manage both value-based and fee-for-service charges….{and} Denials management will continue to be a key indicator of revenue cycle performance, with an increased focus to denial prevention.”

He added: “{I}t surprises me sometimes the level of understanding within organizations surrounding revenue cycle processes.”  Executives and staff will need lots of education as they move deeper into the payment-for-value world.


When will/can sector ditch fee for service?

 

She notes that a new  PwC Health Research Institute (HRI) report  says while healthcare executives publicly praise the move to value-based care, “they privately drag their feet while they wait for a successful model to emerge before they take on the risk.”

Ms. MacDonald says that “One reason for their hesitancy–or what the authors described in the report as a ‘go-slow, dip-the-toe-in-the-water approach’–is the legitimate concern that revenue will decline in the early years of the transition.”

Ceci Connolly, HRI director, holds  out  hope, however. In Ms. MacDonald’s words, she says:

“It will take investment in strong data analytics, improvements in the care they provide and a culture change so all doctors, nurses and healthcare professionals truly operate as a team. But the organizations that have made these front-end investments and stuck with it are beginning to see their efforts pay off.”


Medicare incentive programs’ big design flaws

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Design flaws are hurting Medicare’s incentive programs, reports Modern Healthcare’s Melanie Evans, using the experience of Hebrew Home in New York City as a prime example. She says that such programs must “offer a robust link between efforts, performance and reward, and incentives must be large enough to make a difference, experts say.”
“The CMS, private payers, policymakers and provider systems are placing heavy reliance on using financial incentives to change provider behavior to improve quality of care and reduce costs. …Half of what the traditional Medicare program spends will be tied to rewards for quality and cost control by 2018. That will mean continued growth of accountable care and bundled-payment contracts. Other incentives that penalize or reward hospitals for quality and safety, known as value-based purchasing, will be linked to 90% of Medicare spending by 2018.”
“But researchers say much depends on properly structuring the incentive programs to achieve the desired results. Public policy inside and outside healthcare is strewn with incentive programs that have fallen short of producing the desired results. The consequences of poorly designed incentives can be higher spending and lower quality care. For evidence, look no further than Medicare’s fee-for-service payment model, which has been widely blamed for encouraging greater volume of services, causing higher spending and exposing patients to the risks of unnecessary and disjointed care.”

 

 

 

 


How a fee-for-service medical home is thriving

 

Hospitals & Health Networks reports that “for all of the chatter about risk-based models, there are still pockets where fee-for-service reimbursement is proving that providers can deliver high-quality care and reduce costs.”

Consider Baltimore-based CareFirst BlueCross BlueShield. It has released  results for a fee-for-service patient-centered medical home it runs in Maryland, Washington, D.C., and Northern Virginia that  showed significant improvements in 2014:

  • “5 percent fewer hospital admissions.
  • “11 percent fewer days in the hospital.
  • “8 percent fewer readmissions for all causes.
  • “12 percent fewer outpatient health facility visits.

And for the four-year run of the program (2011-2015):

  • “19 percent fewer hospital admissions.
  • “15 percent fewer days in the hospital.
  • “20 percent fewer readmissions for all causes.
  • “5 percent fewer outpatient health facility visits.

 

“We do call it a patient-centered medical home, and that’s what it’s focused on, but it is different from what other (organizations) are doing in this space,” CareFirst spokesman Michael Sullivan told H&HN. “It’s not based, for instance, around (National Committee for Quality Assurance) certification as a medical home. It doesn’t pay per member, per month fees.”

But H&HN reported that ” the plan does offer robust support to those who participate, starting of with a 12 percent increase just for joining and maintaining membership.”

“The number of participating physicians and advanced practice nurses grew to 4,052 as of this year, up from 2,152 the first year of operation in 2011, according to a performance report. Attributed membership grew to 1.1 million in 2015 from 490,000 in 2011. An important part of gaining the broad 80 percent participation rate is the fact that the program is fee-for-service, which is more practical and familiar to providers, Sullivan said.”

 


Keeping fee for service profitable

 

Rita Numerof writes in detail about how hospitals can succeed at fee for service even as they (and the rest of the healthcare system) move toward fee for value. 

The steps include:

Defining a hospital’s cost structure.

Managing variation in cost and quality, which includes much emphasis on evidence-based medicine.

Focusing on  achieving predictable and transparent outcomes.

 


Response to Medicare payment-change plan

Herewith a very useful discussion in MedPage Today by health-policy experts  and providers on the Department of Health and Human Services’ plan to  phase out Medicare traditional fee for service based on volume and instead pay providers according to quality and value of care.

The questions discussed:

“What are the most appropriate alternative payment models?”

“How much impact on quality and cost of care do you expect to see?”

“What unintended consequences do you worry about?”

Among the more interesting remarks were those of Richard Kravitz, M.D., who said:

”{R}egardless of the accounting scheme, value-based payment requires systems for measuring both medical risk and quality reproducibly and accurately. Our ability to measure quality at the aggregate level is excellent, but quality assessment at the individual level lags far behind.”


How to address physician self-reference

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The Ouroboros, a dragon that continually consumes itself, is  a symbol for self-reference.

 

This piece in JAMA looks at  the persistent increase in physician self-referrals, which costs payers vast sums every year,  because of ”inadequate statutory and regulatory oversight in the face of ongoing incentives afforded by the fee-for-service reimbursement model.”

The authors say that problem requires ”regulatory or legislative relief. Support for legislative is substantial. Consensus recommendations of a broad swath of health policy experts called for the closure of ‘loopholes for in-office imaging, pathology laboratories, and radiation therapy.”’

 

 


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