Whether you look at economic trends, recently passed legislation or imminent payment reform, there is no getting around the fact that current healthcare spending in America is unsustainable. The question of when healthcare reform will affect the day-to-day functioning of our practices has been answered, and that time is now.
Some liken our situation to the metaphor of the frog being boiled alive. And many specialties are beginning to feel the heat: Medicare cuts, lower reimbursement, delayed payment schemes, increased preauthorization hassles, hasty changes to healthcare policies, contract modifications and new data reporting requirements are all having a profound effect on the long-term sustainability of the private physician’s practice. Many are looking for ways to adapt as new payment models arrive at their doorstep. Others are taking a wait-and-see approach. The question remains: How long can a practice remain in neutral?
It’s time to make a quantum leap out of the boiling waters. A dynamic solution is needed, and harnessing the future of quality measurement for improvement and accountability is the key to success.
Where we stand
Many factors drive the high level of healthcare expenditures. However, one culprit stands far and above the rest: the fee-for-service payment model that reimburses physicians for each service they provide. Unfortunately, this creates an unwarranted financial incentive to provide more (and more costly) services that do not necessarily result in increased value. It’s been used for decades, but the fatal flaw of the fee-for-service model is that payment is not linked to outcomes.
In March, the National Commission on Physician Payment Reform1 released findings that reflect an urgent need for physician payment reform. Twelve broad-spectrum proposed recommendations signal a fundamental shift in how physicians are reimbursed. The Commission’s sixth recommendation was particularly compelling: “Fee-for service contracts should always include a component of quality or outcome based performance reimbursement at a level sufficient to motivate substantial behavior change.” According to the Commission, the antiquated fee-for-service model needs to be recalibrated (and eventually replaced) to reflect value-based decision-making. Quality metrics need to be incorporated into a new hybrid form of value-based contracting that reflects appropriate, cost-effective care.
Where we are headed
There is little doubt that if outcome-based performance becomes the new gold standard by which payment is allotted, a new commitment to tracking and analyzing data (that is, outcomes) is necessary. One specialty has tackled the need for constructive data head-on. In 2009, an economic advisor at a Washington state MGMA conference predicted that most oneto two-physician private practices would eventually fall by the wayside due to the burden of building comprehensive information technology structures and improving quality metrics. Those who heard the prediction began to establish ways to standardize and collect quality data in new ways.
Finding ways to incorporate quality metrics into private practices is only the beginning. Here are five measures that every practice should consider to secure a spot at the negotiating table:
- Prepare for value-based payments: If value-based payments become a reality, every practice professional will need documented outcome measures that prove the value and cost of the care provided. If a physician can prove the efficacy of treatment in the form of clear patient outcomes, he or she will be better poised to negotiate higher reimbursements.
- Consider accountable care organization (ACO) alignment: Because considerable focus is given to procedure-based specialties within the ACO model, how will specialties (such as rheumatology) stand out among the rest? Those that bring data analytics and quality metrics to the coordinated care table will be primed to meet the ACO’s twin goals of improved quality and lowered costs.
- Become patient-centric: Tracking patient data on a regular basis and sharing results with them in real time could result in a patient’s renewed commitment to managing his or her disease successfully. Health plans and employers lose big money when patients do not take their medications properly. Hence, an increase in patient compliance could result in higher reimbursement for many physicians.
- Establish consistent quality and safety: Focusing on technology that enhances efficiency with standard policies and procedures will strengthen the validity of structured metrics and will enable physicians to quantify and improve safety measures that naturally result in better patient outcomes.
- Implement new technology: Any piece of information that is relevant to a decision, treatment or interaction needs to be available in real time. Aligned partnerships in large systems need to easily move data from point A to point B. Practice professionals who implement a data collection portal that tracks patient outcomes and quality metrics in real time, sooner rather than later, are automatically one step ahead of the game. Analyzed data help identify trends, predict outcomes, influence therapy choices and improve care as both physician and patient work toward a low-disease activity state.
Alternatively, aggregated data within the portal can be used to quickly facilitate preauthorizations and the denial appeals process. In short, data collection tools (such as portals) can fulfill two basic needs of the changing payment landscape: access to chronic disease data and validated quality measures that gauge the efficacy of treatment.
Specialists who are equipped with this kind of data are able to come to the payer negotiation table and discuss the option of value-based contracts. The boiling waters of healthcare reform are daunting. The real question is whether physicians are willing to make the quantum leap out of the boiling water and into the world of data. Transforming clinical data into insights and intelligence, delivered where and when they are needed, will have a profound impact on how healthcare in America redefines value. Many professionals have already joined this effort— and in doing so, they have dramatically improved their position at the negotiating table.