If physicians don't start having serious dialogues with their overweight patients, the American Medical Association's recent classification of obesity as a disease won't mean much at all.
So, America is heavyset. It's husky, unslender, and thin-challenged.
What's in a name? As more Americans are tipping the scales toward obesity, the American Medical Association says that another name is linked to obesity and that name is: disease.
Delegates at the AMA's annual meeting last month voted to recognize obesity as a disease, elevating it from its previous status as just another health concern. Proponents hope the move will prompt reimbursement changes that may allow physicians to take more time to discuss obesity with patients and advise them to change their diets.
But not everyone agrees with the shift, and some are wondering whether the AMA is missing the point because of the complexities of obesity. Critics also note that one of the AMA's key committees even recommended against declaring obesity a disease because of different definitions being used for body mass.
Michael Nusbaum, MD, medical director of the Obesity Treatment Centers of New Jersey, doesn't think so. How ironic, he says, that the Patient Protection and Affordable Care Act doesn't treat obesity as a disease. By omitting it from essential benefits, tens of millions of Americans "are disenfranchised from the healthcare system," he told me.
He says the Centers for Medicare & Medicaid Services and insurance plans should "wake up and admit it's a disease; it needs to be treated like a disease and covered like a disease."
Yet Andrew Weil, MD, a best-selling author on health and eating, disagrees, saying on his Web site, "I do not consider obesity a disease." Instead, he sees it as "a condition that may increase risk of certain diseases. It is possible to be obese and healthy – if one eats a balanced diet, gets regular physical activity, attends to other aspects of lifestyle that influence health and makes use of appropriate preventive medical services," Weil writes. He declined an email request for comment.
Controversy notwithstanding, with its latest move, the AMA hopes put pressure on insurers to cover the diagnosis of obesity.
The Centers for Disease Control and Prevention estimates that more than 65% of adults over age 20 are overweight. At least 30 million Americans have diabetes, also linked to obesity. For obese patients, there also is an increased risk of heart disease, stroke, high blood pressure, high cholesterol, kidney, and gallbladder disease. Moreover, 17% of children are considered obese.
"We know the health consequences and financial burden of obesity on our country is devastating," says AMA board member Patrice A. Harris, MD. "As physicians who are on the front line treating this disease, we seek to elevate this issue and get people to pay attention to the seriousness of the situation, which was one motivating factor in adopting the new policy."
Since the AMA's decision, it has "sparked a public conversation about obesity and its health consequences," Harris adds.
"This classification changes the way physicians and the medical community will talk about obesity with their patients," she adds. "For instances, physicians previously had conversations with their patients about treating obesity's health implications, but this designation helps physicians to talk about obesity in and of itself."
Among the obstacles are different views of what constitutes obesity, especially in terms of body mass index. While the AMA believes a body mass index of 30 or greater should be considered obese, CMS holds to a different number, 35.
There have been major disagreements within the AMA itself, with the organization's Council on Science and Public Health voting against obesity being defined as a disease, in part because of various measures trying to define it.
"While recognizing the important public health implications of the obesity epidemic, the council was reluctant to identify obesity as a disease," Harris says. "Rather, they opted to reaffirm some important AMA obesity policies." The AMA's House of Delegates acknowledged the Council on Science and Public Health's position, she adds.
During the debate on the resolution, "physicians in the (House of Delegates) considered all the information in front of them, including the council report and testimony presented by various physicians, state and specialty societies," Harris says. "The council supports the view that the most important task moving forward is for the nation to do a better job of addressing the obesity epidemic."
After the AMA declared obesity as a disease, legislation was introduced in the U.S Senate and House of Representatives that would require Medicare to cover more obesity treatment costs. The proposed Treat and Reduce Obesity Act, focuses on payments for prescription drugs for weight management and allows providers to be financed to offer intensive behavioral counseling for obese patients.
Whether CMS will declare obesity a disease remains to be seen. The AMA "cannot predict what, if anything, CMS will do in response to the adoption of this AMA policy," Harris says. "While the AMA is not the authority that dictates insurance coverage of procedures and treatments, this policy could potentially encourage the government and other third-party payers to increase their coverage of obesity-related services."
Paul Teitelbaum, a healthcare expert and managing director with Mesirow Financial's investment banking group in Chicago, told me the AMA's action is significant because there will be "an increase in investment and strategic" decisions directed toward medical device innovation for obesity treatment.
All this is certainly well and good. But discussions between patients and physicians may be the most helpful tool for treating obesity. And so far, many physicians haven't done an effective job in treating obese patients.
For one thing, many doctors don't tell patients they have a weight problem that needs to be addressed. An Archives of Internal Medicine study found that only one-third of 5,500 patients who were obese and 55% of overweight participants were told by a doctor about their weight issues. Moreover, only 30 to 40% of family practitioners compute their patients' body mass index on a regular basis, according to theAmerican Academy of Family Physicians.
At the same time, studies show some doctors have biases toward obese patients. A 2009 Journal of General Internal Medicine study showed that 40 Baltimore area physicians and 238 of their patients found that doctors have a lower respect for patients with higher BMI.
That's no way to help patients.
Harris of the AMA is convinced, however, that characterizing obesity as a disease will spur much-needed changes in treatment of the condition.
"Recognizing obesity as a disease will encourage patients and physicians to have candid conversations about their weight, and also about other key health indicators like blood pressure, blood sugar, and cholesterol levels," she says.
"This will help to facilitate a dialogue between patients and physicians to determine which behavioral, medicinal or surgical options may be right for each patient," she adds.
If physicians don't have that "dialogue" with patients, the AMA's characterization of obesity as a disease won't mean much, and will be pretty much forgotten, especially if funding for treatment of obesity isn't improved.
Perhaps it's time for federal regulators to examine themselves, because it certainly appears there's too much oversight that inhibits physicians from doing their jobs, and too little to ensure that they do their jobs right.
As the year is now beyond the halfway mark, and the countdown to full implementation of the Patient Protection and Affordable Care Act is on, physicians are in an evolving, never-ending stranglehold of regulations, making them more riled up than ever.
At the same time, a media report finds that the largest physician organization – the American Medical Association – may be exaggerating physician work hours, which has the consequence of overpaying some doctors, never mind pushing healthcare spending even further out of whack.
Hmmm. Is this healthcare reform?
Perhaps it's time for federal regulators to examine themselves, because it certainly appears there's too much regulation that inhibits physicians from doing their jobs, and too little regulation to oversee that they do their jobs right.
Taking aim at regulations it says are suffocating physicians, the Physicians Foundation issued a report last month describing what it called the "top 10 regulatory irritants" that are overwhelming doctors. These aren't new, but it's a complicated swirl of issues that doctors face.
The report discusses 'meaningless work,' under Meaningful Use that includes a 'bewildering requirement' that notes ophthalmologists must weigh patients. As the report says: for what? It talks about the upcoming ICD-10 for 2013, which involves 68,000 codes, often confusing and unsettling to doctors. It mentions medical guidelines, thousands of them, that they say are inconsistent and have little impact on improved patient outcomes via the Independent Payment Advisory Board (IPAB), and the Patient-Centered Outcomes Research Institute, and hundreds of other groups.
The report also refers to the problems of electronic medical records, and of course, it cites outrage over the controversial sustainable growth rate formula (SGR). There are other matters, too, such as physicians evaluating varying definitions of quality, uncertainty over hospital acquisitions, questions about fraud, and RAC audits.
Finally, the Physicians Foundation report discusses "transforming the practice of medicine into the practice of box checking" and "the government coming between me and my patients."
I talked with Lou Goodman, PhD, president of the Physicians Foundation, about the report. Talking about the irritants makes Goodman, an easy-going guy, irritable.
"I think the folks in Washington think they are improving care or making it better or saving dollars, but in individual doctors' offices, there's really no cost effectiveness, no evaluation of regulators and what their impact is," Goodman says. "Let's put some kind of filter on the regulation-writing establishment."
"All these administrative requirements do not have positive impacts on care people are receiving, it seems like we are working at cross purposes," Goodman adds. "We're for progress, but let's make sure it is moving us forward, not backward."
Fred Hyde, MD, JD, MBA, head of Fred Hyde & Associates, in Ridgefield, CT, and a clinical professor of health policy and management at Columbia University, wrote the Physicians Foundation report. He told me that the regulatory evolution in American medicine is evolving from clinical care, where it should be, into misguided oversight of dollars and cents.
"The enormous, complex regulatory mechanism put in place in American medical care is increasingly resembling what medicine would be like if practiced by economists, not medicine as practiced by physician," says Hyde. "The truth is, however, that doctors will tell you that patient care is more complex than can be provided for "in guidelines."
What's happening now are the "unintended consequences" of regulations, Hyde writes.
Those regulations are certainly hindering patient care, at least in the eyes of physicians. But maybe more economists should be involved, at least when it comes to physician pay. That argument comes on the heels of the Washington Post report last Sunday that said physicians were paid, in some cases, based on hour-estimates and specialties recommended by the American Medical Association that were inflated. Federal regulators are essentially responsible for approving such payments, but are woefully understaffed to monitor the AMA bean counting.
The Post referred to the AMA/Specialty Society RVS Update Committee (RUC)'s role in providing "resource cost information" to the Centers for Medicare & Medicaid Services. Every three years, the committee meets for several weeks to review procedures and cost estimates. In a review of more than 5,000 procedures over a 10-year period, the Post uncovered a wide variation in payments, including instances in which physicians would have to put in more than 24 hours each day for procedures, such as colonoscopy, to get the pay the AMA recommends in its value-scale.
Increased technology improvements over time should have reduced the amount of time doctors needed for such procedures, but that hasn't been reflected in the pay, the Post asserts. Between 2003 and 2013, the Post wrote, "AMA and Medicare have increased the work values for 68% of the 5,700 codes analyzed by the Post, while decreasing them for only 10%."
While the Post has called the RUC, a secretive committee, the AMA has disputed the claim, as well as many other elements of the newspaper's story. For instance, the AMA stated that it was untrue that relative values have primarily increased since 2003, leading to an increase in Medicare spending. In addition, the AMA asserted that its committee "has worked vigorously over the past several years to identify and address (misevaluations) in the RBRVs (Resource-Based Relative Value Scale) through provision of revised physician time data and resource cost recommendations to CMS." The RBRV is used to determine how much providers are paid.
Evaluation of pay scales are constantly monitored, the AMA states. "The committee fully acknowledges that there are services that are now performed more efficiently and these codes have been or will be addressed." For instance, the time and valuation for cataract surgery was significantly reduced in 2013. About 500 physician services have been decreased, redistributing $2.5 billion to primary care and other physician services, the AMA said. While the AMA issued a "background" statement, no official was named to provide details of the AMA response.
But there is one outstanding feature of the Post story that the AMA does not refute. While the AMA spends upwards of $7 million on evaluation of values and possible pay scales, the government has only about a half-dozen part-time workers on the payment reviews, certainly deflating its ability to regulate or control pay for relative value of procedures.
Here we have it: the government, so very regulation-oriented, has decided not to spend money to hire people to carry out the very regulations it imposes, or to oversee the enormous responsibility and expense of physician pay. So it certainly puts itself in a position to rubber stamp the AMA, or anybody else.
As for most physicians, they are caught in the middle, as per usual. The Post disclosures don't really faze him, says Hyde. "My reaction to it is neither 'up' nor 'down,' he adds. As doctors face regulatory and payment issues, "the only collective action that physicians can take, is through our large and increasingly powerful health systems, or in the alternative, through a rapprochement between the regulated and the regulators," Hyde says. "The RUC, as I see it, represents such an understanding."
Hyde emphasized that Medicare isn't "compelled" to accept the RUC's recommendations, but its role, he says, may be important to prevent even more physicians from leaving their practices.
"What the doctors and CMS do through the medium of the RUC is, I think, attempt to keep as many physicians involved in practicing medicine for Medicare and Medicaid beneficiaries as possible," Hyde says, noting the fascinating, and always complex, world of the regulated and the regulators.
Radiology leaders advocate standards-based medical imaging programs to reduce errors and improve efficiencies. The aim is to reward radiologists "not for more procedures, but for the right ones."
"[Radiology is] the greatest profession in medicine. When a patient comes to you, if you are not sure of the answer, you simply just order more tests," says Everett Neal, And "by the way, you get paid for that," he laughs.
Neal, the VP of Hospital Partnerships of Radisphere, is relating what he terms a "cynical" view that some people have about radiologists.
Joking or not, he touches on a truism that has often been pinned on radiology: It's too costly, there are too many procedures, and it's a microcosm of the woes of healthcare itself.
Yet many healthcare leaders are trying to change that; Neal among them. So is Allen Weiss, MD, president and CEO, NCH Healthcare System in Naples, FL, which is coordinating radiology care with a focus on efficiency and standardization.
Several years ago NCH changed its radiology program to improve data collection and quality enhancements through a partnership with Radisphere. Before that move, "we literally didn't have any quality parameters, not at all," Weiss recalls.
Now, radiologists are "getting rewarded not for more procedures, but for the right ones…We're ordering fewer procedures and [fewer] tests," he says.
OK, but is it working? "Reimbursements are going down dramatically," Weiss confirms.
As Weiss and Neal see it, radiology has become a forgotten "outlier" in discussions about reducing healthcare costs and improving quality of care. A Radisphere study found radiology "lags substantially behind" other health care practices for improved quality standards.
While many call the healthcare industry fragmented, radiology is especially so, they say. There are more than 25,000 radiologists in private practice there are at least 2,000 radiology groups.
Yet radiology has great potential. The Advisory Board estimates that radiology will grow at a 9% rate annually, and high tech imaging will grow faster, at an 18% rate, according to Radisphere. Radiology represents nearly 10% of U.S. commercial healthcare spending each year, equating to more than $200 billion in annual spending.
As systems move toward population health, radiology will play an increasingly important role, Everett says. "It has a tremendous impact on the metrics everyone cares about, including: 'Are we radiating folks with too much radiation? How do we get costs under control?'"
"We've got to get radiologists out of the basement" onto the "care floor" of hospitals, such as having radiologists consult regularly with other physicians and patients, "making sure the right tests are being performed," says Neal.
Indeed, Weiss and Neal say there have been too many errors, too much clinical variation, and too much costly duplication of work among radiologists. They say it's important that providers and hospitals adopt system level standards and best practices for radiologists to improve efficiency and quality.
By establishing measurable performance standards to evaluate and ensure accountability among providers, radiology programs can be markedly improved, according to Weiss and Neal. There are tough tasks to overcome. Lack of coordination to improve workflow and costly turnaround times impact the complete care cycle, especially the emergency departments.
Through these standards-based approaches, hospital officials can reduce overutilization. Radisphere estimates that studies show about 20 to 50% of inpatient diagnostic imaging may be clinically unnecessary, driven by referring physicians and radiologists.
Unnecessary imaging can occur when "a wrong exam is being ordered to begin with, or a radiologist can't get a 'clean' read, Neal says. "There is a big variation that frequently has tremendous downstream implications" for costs and quality, he says.
Eliminating radiology errors also is a major concern among hospital officials. The error rate in procedures can range from 4.4% to 9.2%, according to Radisphere.
Error rates have a significant impact on downstream healthcare costs that will gain urgency under healthcare reform and new delivery models, Weiss says. By implementing the standards-based programs, the hospital has reduced errors, he adds. And the healthcare system has established peer review programs to ensure that radiologists are accountable for their work.
NCE did an extensive review of its radiology programs, looking for significant discrepancies and potential errors. In an evaluation of 47,000 cases, officials found discrepancies in 40 cases, a .08% rate, Weiss says.
"We'd like it to be zero, but stuff is going to happen. But .08% is still reasonable." When any problems are identified, Weiss notes, "Results have been communicated back to the referral physician by the reading radiologist to ensure the communication loop has been closed."
"You need standards," Neal says of radiology programs. "Most [healthcare leaders] will pause and say, 'I have standards." But when Neal says he talks to healthcare leaders about standards, he finds many hospitals lack efficiency clauses in contracts with radiology groups.
"You need to write it down and say what you need from radiology. You have to say what your objectives are."
The Dean Clinic has navigated through tough waters toward a value-based physician compensation model. It is an outlier. More commonly, physician and hospital contracts are top-heavy with volume, not value, a physician recruiter says.
Although we are supposedly moving toward a value-based provider compensation model, many hospitals are struggling toward developing such programs, while others continue to develop contracts with physicians relying heavily on how much volume the doctors are generating.
That's not the way it is supposed to be.
"We need to get past the schizophrenia and need to take a leap," says Craig Samitt, MD, MBA, president and CEO of the Madison, Wisconsin-based Dean Clinic discussing the trials and tribulations of establishing a compensation model for physicians based on value, rather than fee for service.
Last month, Samitt, who heads one of the largest integrated delivery models in the Midwest, spoke at the National Accountable Care Organization Summit in Washington D.C., and noted that physicians often are not truly engaged in developing these compensation models. As hospitals and doctors evaluate data for compensation, it is "like going through the grieving process," Samitt said. That includes denial ("My patients love me. The data must be wrong") to depression ("My patients hate me") to acceptance ("OK.")
Sometimes, he says, hospital leaders themselves feel like grieving.
Samitt recalled how, years ago when he was COO of the Fallon Clinic, there was a physician rebellion at the prospect of cultural and organizational changes. "A group of doctors told me, 'if you don't stop this, we will fire you as the chief operating officer of our organization,'" he recalls.
Samitt eventually moved on to Dean, where the CEO concedes that the health system uses tough negotiating tactics with physicians, in the move toward a quality-based world. Dean told its physicians, "If you continue to churn out volume, (we'll) reduce your compensation by 5% next year. Every year you just continue to churn out volume, you will continue to reduce compensation by 5%."
As outlined in a HealthLeaders Media case study this year, the Dean Clinic leadership believed they were not getting the kind of quality and experience they wanted from primary care physicians. At that time, the Dean primary care network was not unlike others across the country—somewhat fractured—with difficulty in recruiting physicians and keeping patients happy. Five years ago, Dean's PCPs were compensated using the industry standard relative value unit (RVU) formula, in which a standardized dollar amount is given for each encounter or procedure.
The Dean Clinic then "totally revamped "its primary care compensation plan, using quality incentives, and it has been successful, Samitt says. The revised compensation formula was meant to align physician performance with the value-based care goals.
It included 60% compensation that was still RVU-based; but other areas were based on age/gender-adjusted panel size and incentives for services, financial performance, clinical quality and growth. The formula eventually totaled 115%, which allowed the doctors to earn above market compensation.
"We wanted (physicians) to pick that up, with service, quality, and efficiency, and 100% of the physicians chose that," Samitt says. "In a single year we made a significant move from volume to value-based incentives."
As Samitt sees it, Dean is getting past the schizophrenia.
Not everybody is. While Dean found a way, especially through tough negotiations, to move toward value-based care and compensations, that certainly doesn't seem to be the case everywhere around the nation, according to Steve Marsh, owner and managing partner of The Medicus Firm, a national physician recruiting company based in Dallas, TX and Atlanta, GA.
He told me that most physician compensation models he's worked on involve volume of care, which certainly undercuts, or at least slows, the country's move toward value-based care.
"At the end of the day, physicians are going to do more volume to maintain their income levels. No way around it," Marsh says. "At least on my radar screen, I don't see a system completely based on value, I don't think that will happen." Physicians, especially, will be involved in programs that will demand both quality and volume, especially in receiving bonus awards under contracts he's seen, Marsh says.
What about the much-ballyhooed moves toward quality, which is virtually demanded by the government, through incentives and disincentives, such as the form of 30-day readmission penalties? Marsh contends healthcare contracts for physicians are moving in that direction, but only slowly.
"We are seeing components of that," he adds. "Certainly hospitals are being incentivized to do that, when you look at hospital readmission rate data. It's a great thing. I can tell you, though, looking at a ton of hospital employment contracts, you will see value over volume making up to 5%, 10%, or 15% of somebody's income, and the rest is normally based on volume. I think the percentage of income may go up to 20%, but I always believe that physicians will be seeing more patients and doing more procedures to increase their income."
"There's only so much physicians can do to cut their overhead and so much hospitals can do, and run a quality organization. Physicians are getting squeezed from both directions," Marsh says.
The employment contracts leaning toward volume are repeatedly being written as physicians continue to be smitten with hospital employment. The Medicus Firm's latest survey on physician compensation shows that more than half—54%—of new physicians in training indicated a preference for hospital employment.
The research was included in the firm's annual poll of over 2,500 doctors in a report entitled the "2013 Physician Practice Preference and Relocation Survey," which focused on workforce trends and practice preferences.
Whether they are entering volume or value-based contracts, hospital negotiations with physicians are likely to be tense. Generally, physicians remain dissatisfied with their income levels, based on 2012 salaries, and blame declining reimbursements and "administrative hassles" for stagnant compensation, according to Medicus.
As Dean Clinic continues its value-based journey, Samitt concedes most organizations still work in the volume world. Yet, "one of the early things we found in our journey is that you can't pay your physicians for volume in a value-based world." He added that the hospital system did have the proverbial "one-foot in the boat and one in the canoe. You are going against the grain (volume) and we took on a very bold endeavor within our organization to redesign our compensation models."
From his perspective, "the world is evolving from volume to value," Samitt says. Generally, though, "it's in a bit of a schizophrenic place."
Dean itself moved from such a place, and has landed nicely, but not without difficulties, Samitt says. He emphasized the importance of technology and capturing the data. "We shouldn't incent what we can't change and can't measure what we can't capture. We can't capture with antiquated technology," he says.
"It's really about whether we are focusing on the right thing," Samitt says. "It's a marathon, not a sprint."
Government quality metrics fall short in meeting the needs of safety-net healthcare providers, who complain that such measures force them to divert their resources into lower priority programs.
Safety net physicians are calling for new measurement criteria to replace existing government quality metrics, saying the status quo isn't suited for the "real world."
Martin Serota, MD, chief medical officer of Alta Med Healthcare Services in Los Angeles, the largest independent federally qualified community health center in the U.S., is one of those docs seeking change. Current quality measurement scores don't address the basic healthcare needs of urban at-risk patients, and, as a result, funding is redirected elsewhere, says Serota. AltaMed is a team that delivers services in 43 sites in an affiliated Independent Practice Association of contracted physicians in Los Angeles and Orange Counties.
"With health reform stressing accountability, efficiencies and patient-focused care, it's important we address real world issues for our safety net patients," Serota said in a statement. His call to action is the latest among those having concerns about changing quality metrics for safety net hospitals.
Quality ratings, which are a key element of the Patient Protection and Affordable Care Act, influence how hospitals are paid. The quality scores for safety net hospitals have been generally lower than for other hospitals. The safety net hospitals provide a significant level of care to low-income, uninsured and vulnerable populations.
Trying and failing to meet the benchmarks for government quality programs often leaves healthcare safety net programs in the lurch for funding, Serota says.
Serota is blunt in his call for reform, telling me that existing government measurement for quality hasn't been "about truth."
"As we should be moving toward more patient-centered care and population health, we need to be thoughtful about what we measure and why we measure it," Serota told me. "There [are] a lot of reasons for our current quality measures. They were based on several criteria, things that can be measured easily, and measured by claims data and not by truth."
Serota and co-authors expressed their concerns about quality target measures for population health management of the at-risk population in a June commentary in the Journal of the American Medical Association.
While traditional quality measures may be suitable for the commercially insured population, they may not be suitable for patients who need safety net care.
For instance, Serota says that traditional quality measures such as colon cancer screening are legitimate in mainstream hospitals. But healthcare facilities serving impoverished patients have difficulty enrolling patients in such programs because the patients have more pressing concerns, such as chronic illness, or drug and alcohol addictions.
Over the years, Alta Med has invested large sums in putting together quality programs, especially through expensive IT platforms to improve data collection for higher quality and improved reimbursements. Yet Alta Med sees differences in data points it views as important compared to the government, when it comes to a needy population.
When physicians sought to increase screenings for colon cancer, Alta Med struggled. The screening rates were almost 20% below target, according to Serota's report. The doctors tried different ways to attract patients to screenings, such as outreach campaigns and electronic reminder systems. As healthcare officials struggled with screening targets, they wondered about the ROI – financially, and for patient care, Serota says.
"Although we fully appreciate the value of colon cancer screening (one of us had almost 100% compliance rates previously in private practice,) we weren't certain that focused outreach to improve our rates was the best use of staff time," Serota wrote in the JAMA commentary. "In order for our case managers or referral specialists to dedicate efforts to promote colon cancer screening, they would need to spend less time doing something else."
Too often, traditional quality measures such as cancer screening rates and process measures for diabetes care, are "non-patient centric and may result in the redirection of precious resources away from the services patients most need and toward services that are tracked in quality reports," Serota and his colleagues wrote.
In our conversation, Serota recalled that when he was in private practice, his insured patients got colon screenings "and it did reduce the incidence of colon cancer in my population, at an incredible cost."
"At a much lower cost we can be immunizing people in the inner city, and doing other things for them, such as feeding them or housing them at a much lower cost," he says.
Alta Med has a substantial investment in IT, but officials wonder if the group is tracking the proper quality metrics to improve their patient population, Serota says.
"We had to build a quality department, to collect data and build the informatics infrastructure," Serota told me. "We run a skinny margin" in profitability, he adds. "If we are going to spend that much money, we want to go for the right things for the right reasons," Serota says. "That's the biggest issue."
In his JAMA report, Serota and other authors call for a "new platform" to address quality measurement that they say is more "outcomes-based, simple and adaptable to local circumstances" than existing measures.
While patient satisfaction scores should be maintained, significant changes for the government's quality metrics would be fairer to safety net hospitals, Serota wrote.
Serota added that there is a need for "risk adjustment emergency department and hospitalization utilization." Too many ED and hospital visits are often described as a "failure" of the healthcare system. But instead of being penalized, hospitals serving at-risk patients, who often use the ED, should be rewarded for providing "intangible services," such as preventative care, social support and educational resources.
In addition, hospitals should be given compensation for providing "enabling services"—including transportation, social and counseling programs, including an obesity prevention focus.
"One quality measure the government doesn't address is obesity," Serota says. "Having reduced obesity is not a quality measure, and that's the biggest health issue facing our country. Yet there's no quality measure around it."
By changing its focus, the government would help "better align quality improvement with what brings value to patients," the Serota commentary states. "Without such a shift, quality measurement—and the ensuring improvement efforts—may continue to shift resources away from where they are most needed. This is something we surely cannot afford."
From reimbursement challenges to figuring out what makes some physician practices great, the American Medical Association's new president, Ardis Dee Hoven, MD, vows "significant change" for doctors in the year ahead.
Ardis Dee Hoven, MD
The state of medicine isn't pretty. Physicians are annoyed about reimbursements, disgruntled about ICD-10 billing codes, and electronic health record systems, and worried about the confluence of a looming doc shortages and a growing population of aging and chronically ill patients.
In the meantime, older physicians are bolting from their practices, while younger doctors face funding shortfalls in medical education.
The nation's largest physician organization, the more than 220,000-member American Medical Association, has been keeping a keen eye on these volatile issues. This week during the organization's House of Delegates annual meeting in Chicago, the organization introduced Ardis Dee Hoven, MD, an internal medicine and infectious disease specialist from Lexington, KY, as its 168th president.
Since 2005, Hoven has been in leadership positions at the AMA, first serving as secretary from 2008–2009, and then immediate past chair for 2011–2012. Hoven says her career treating HIV/AIDs patients through the early 1980s motivated her to become involved in organized medicine.
Hoven talked with me this week about her views on issues the AMA will be confronting over the next year.
HLM: What are your top priorities for the AMA?
Hoven: The first is stabilizing medical practices, and being sure our physicians can navigate the changes in the way healthcare is being delivered, [second] to be sure our patients are doing well and getting the highest quality care possible. I love the work we're doing around improved health outcomes. And thirdly, a huge one, is accelerating the change in medical education.
HLM: What has to be done with medical education?
Hoven: We've been talking change in medical education for years, but in fact we haven't done it. We know change needs to happen. In the long term… we have to address GME (Graduate Medical Education). The horrible thing is that Congress put a cap on available graduate medical education slots.
The number is still the same as it was in 1997. We've got to look at funding for GME, and it's potentially in crisis mode."
HLM: A lot of physicians aren't happy, and are uncertain about healthcare reform. What are you going to do about this?
Hoven: We're looking at delivery reform and payment change. For instance, we are evaluating 30 practices across the nation: big ones, little ones, multispecialty and single specialty practices. These are the [physician] practices that are perceived to be, in their states, thriving and sustainable, with good outcomes and happy patients. What makes them different? What's working for them? We need to put our arms around that and translate [it] into tools and methods for other physicians throughout the country to learn and understand this.
For me, this is extremely important—putting our boots on the ground, helping doctors get to this [degree of success] and making practices sustainable and thriving. That is very much on our radar screen. So hopefully, by July we're going to have the first report on this particular work and I am looking forward to that.
HLM: What about the Sustainable Growth Rate formula? It has been a matter of frustration to physicians for years.
Hoven: That is broken, the whole payment thing. Some physicians have quit practicing medicine, called it quits and have gone into other careers. We've got to get the SGR repealed. It's been a quagmire.
HLM: Is it going to happen?
Hoven: I'm much more optimistic about the SGR being repealed than I've ever been. There is now bipartisan talk to do it. There is movement. The important thing is that Congress has said to the AMA, "Please help us with this," and we are doing that. It is just not feasible to continue the way we have been, so we are very optimistic about it.
HLM: There are clinical issues on your agenda, too. Can you talk about your plans? [This week, the AMA adopted a policy that recognizes obesity as a disease requiring a range of medical interventions; supported a policy to ban the marketing of high stimulant/caffeine drinks to adolescents under 18; and adopted a policy recognizing the risks of prolonged sitting.]
Hoven: Let's take one or two that we can really do a good job around, such as type 2 diabetes and hypertension. You are going to see a lot of movement in those two areas in particular.
HLM: What kind of movement?
Hoven: We have developed a partnership, for example, with the Sustainable Growth Rate and Quality [at Johns Hopkins Medicine in Baltimore, MD,] focusing on hypertension management. Why do we have 30 million people who have hypertension, yet have no control over their hypertension?
What are the dynamics, what is happening there that we need to address, and what do physicians need to do about it? I think it's going to be an exciting challenge to make realtime, practical tools for physicians.
On the pre-diabetes part of it, we are partnering with YMCAs throughout the country, and dealing with exercise, [and] weight issues. You are going to see more action coming out on this over the next year. I'm excited because I'll be able to talk about it."
HLM: How will you address physician shortages?
Hoven: We will be delivering team-based care, utilizing our allied health professionals. Teams can be small, two people; that's our minimal definition of a team. So using physician-led team-based care will allow us to deliver a high quality of care. [A physician] doesn't need to be the one who is there every day to talk to the somewhat overweight patient about diet. A doctor has well-trained personnel, a dietician and a care coordinator who can help do that. [They] can probably do a better job than I can do."
HLM: So much of healthcare is data-driven, such as quality metrics. What is the growing impact on physicians?
Hoven: I think clearly what we have learned in the last 10 or 12 years on quality measurement [is that] doing process measurement is the key. The outcomes are important. We need to minimize the noise. Just doing the process measurement isn't the key; the outcomes are important. We have 400 to 500 measures out there. We've got to streamline and get it down to the measures that matter, that improve outcomes. We need to cut out all the noise.
HLM: Do you see the ICD-10 as part of that "noise"? In October 2014, the ICD-9 code sets used to report medical diagnoses and inpatient procedures will be replaced by ICD-10 code sets.
Hoven: Doctors are concerned about ICD-10; they are concerned about the cost of their practices, about having to hire extra administrative people to make this happen. I think many practices are now feeling put upon by ICD-10.
HLM: There's a lot happening.
Hoven: I'm excited to be in this position and I'm excited for physicians and for our patients. We're in a good place to make significant change.
Two of the pioneering forces behind accountable care organizations say the model is gaining significance as it proliferates across the country, even though there are concerns over lack of uniformity in performance measures.
Elliot Fisher, MD, MPH
While the number of Accountable Care Organizations is increasing dramatically across the United States and showing quality and efficiency successes, many providers are struggling to implement the programs, often due to the wide range of required performance measures.
That was the message delivered this week by Elliot Fisher, MD, MPH, director of The Dartmouth Institute for Health Policy and Clinical Practice, and Mark McClellan, MD, PhD, former administrator of the Centers for Medicare & Medicaid Services, and a commissioner of the Food and Drug Administration. Fisher and McClellan are two of the developers of the ACO model, who spoke at an Accountable Care Organization Summit in Washington D.C. The event focused on payment reform.
Indeed, ACOs are multiplying exponentially, with more than 390 today in every region of the country, working with commercial health plans, Medicaid and states, compared to only about a dozen four years ago, said McClellan, senior fellow of the Brookings Institution and director of the Engelberg Center for Health Care Reform there.
Brookings and Dartmouth have estimated that at least 14% of the American population is now involved in ACO care—about one in seven Americans, McClellan said.
"It's hard to keep up with exactly how large the population is," McClellan said. "The numbers are growing rapidly." They involve hospitals, private insurers, the general population or Medicare beneficiaries.
"The ACO is much more diverse than any one of us expected," Fisher told the D.C. audience, noting there are "a lot of new partnerships, thanks to the kind of energy many of you are bringing to this."
Both McClellan and Fisher noted, however, that many organizations involved in ACO start-ups are trying to overcome challenges in implementing the programs, with concerns especially over lack of uniformity in performance measures sought by the government.
McClellan pointed out that those following the Pioneer ACO Model seek delays and modifications concerning quality metrics, "based on how the measures are calculated, the validity of measures" and, "in some cases, what's the right benchmark to use."
Fisher agreed that some data changes may have to be made. A major concern is variability in performance measures sought by the government in creating ACOs. "There are lots of challenges to ACO implementation. We've been hearing a lot about the need for a common set of performance measures, with everyone agreeing on the same set of measures," Fisher said.
There is a need to align emerging ACO programs with other initiatives, and "the challenge of engaging physicians who are completely stressed out in their current practices, to take the time to engage in a new model of thinking." Fisher noted that the provider side is "struggling to test new models and all of us are trying to learn new ways of practicing in partnerships that are more complicated."
Still, developing ACOs are showing early success in reducing costs, McClellan said. He pointed to ACOs involving Cigna and NovaHealth that have demonstrated dramatic savings in patient care.
Last year, Cigna reported that it was engaged in 16 "collaborative Accountable Care" initiatives in 10 states, involving more than 3,350 physicians, and over 235,000 Cigna customers. Among other things, the report showed that medical costs for 2010 were significantly reduced, $27.04 per patient per month under the ACO, compared with other practices. Performance improvements were also generated, the report said.
As for NovaHealth, an independent physician association based in Portland, ME, Health Affairs reported that in 2011 patients in the program had 50% fewer inpatient hospital stays, 45% fewer hospital admissions and 56% fewer readmissions than unmanaged Medicare populations statewide. Since 2008, NovaHealth doctors participating in Aetna's Medicare Provider Collaboration program have provided care to approximately 750 Aetna Medicare Advantage members.
Early results reflect "new and many variations" in ACOs, McClellan said. "What works best in what circumstances is still very much emerging," he added.
"ACOs are remarkable strategies to improve care, quality and lower cost," Fisher said. "You, on the provider side, are struggling to test new models, and all of us are trying to learn new ways of practicing in partnerships that are more complicated."
Ultimately, "there is so much more opportunity in helping patients learn how to stay healthy and stay out of the emergency room," Fisher said. Providing "great attention to your sick patients gives you the chance to achieve savings," Fisher said. "That's where all the money is," he said.
The former president of Advocate Physician Partners says it's a slow process to get newly hired physicians smoothly cobbled into an accountable care organization. But "culture is the main determinant" of an ACO's success.
Marty Manning
Marty Manning built "one of the nation's leading clinical integration programs," as his new bosses describe it. The former president of Advocate Physician Partners, Manning helped design managed care contracts and other personnel ventures involving 4,000 physicians in nine hospitals within the Advocate Health Care System, based in the Chicago area. In that role, he worked to build consensus among private and employed physicians.
He did the job for eight years, and it was fun, Manning told me. "We had gotten to be a mature and successful organization … and I enjoyed the business incubation in different circumstances." In the process, he saw in accountable care organization development "so much opportunity."
So much that the prospect of more ACO development work effectively prompted Manning to leave his job. In May, he resigned from Advocate Physician Partners and joined Health Directionsas executive VP to lead physician integration, clinical integration and especially ACO practices at the healthcare consulting firm based in Oakbrook Terrace, IL.
He wanted to do something slightly different.
"I feel with the innovations and experimentations going on right now [within ACOs], it's absolutely the right thing for improving outcomes for patients, as well as addressing the cost problems [that are] unavoidable at this point," Manning says.
The process is complex, although the Centers for Medicare & Medicaid Services essentially defines ACOs in the simplest terms, as "groups of doctors, hospitals, and other healthcare providers, who come together voluntarily to give coordinated high quality care to their Medicare patients."
Manning has an easy style, and laughs often in a conversation. From the outset, it's not difficult to see why he is so accomplished at negotiations. Make no mistake, though. This business of physician integration is no easy task.
There are turf battles in the tenuous struggle to find the "right balance" in physician groups. There's the ever-present need for the right physician leaders, and even the need to exert "pressure" to ensure quality. Ultimately, having such a team in place—especially within an accountable care organization—doesn't happen overnight. It can take two years to cobble one together. As Manning says: "It's a journey of several stages, and there are challenges at each stage."
Manning refers to a recent case to illustrate his point. Two hospitals and two physician groups were trying to form an ACO team. "They were coming together for the first time," Manning says. Connecting them meant overcoming "all those cultural challenges, and the history of some differences and animosity. It was getting them to work together and trust one another and forming the ideal governance," explains Manning. That process is still unfolding.
In some ways, timing is vitally important in bringing physicians and hospital groups together. "You don't want to sign up a bunch of doctors and have a lull for six to nine months while you are trying to put your [leadership] board together," Manning says.
Yet, if the deal-making process occurs too quickly, "there is loss of opportunity to engage physicians in that process," he adds. "There's a sweet spot that we go for. Because we have a lot of content and ideas and experience in our toolkit, we can facilitate those discussions. The physicians can act in a pretty well-informed manner."
While timing is crucial, that "culture" thing, seemingly ever-present in healthcare discussions today, is also critical to establishing an ACO team, Manning says. "I think in the long-term culture is the main determinant of success. Anybody can buy a system or set up measures; it's really the performance all around that matters. In order to get to that performance, you need to create a common language, and common ways of doing things, a common value and common dialogue."
Having physician leadership in a team also is a must, Manning says. That's not easy to arrange, either. "Getting physician engagement is absolutely essential to the long-term success of these things," Manning says. "I am a strong advocate that [the ACO] needs to be physician-led, and facilitated by management. I think engagement starts with selection of who the leaders would be." Manning suggests that one of the most useful ways to get physicians engaged and develop leaders "is just having leadership retreats—spending in-depth time to really explore issues, not just approving reports.
Having that "engagement" means that executive teams need to ensure that they don't cater to one doctor at the expense of others, Manning says, or become too involved in certain clinical specialties, without examining the whole.
Although physicians obviously have their own specialties and interests, ultimately those interests should be secondary to the overall team goals, he believes. That's certainly easier said than done. "It's important how you get people together and get them focused and directed, because you can easily get into a rabbit's hole of everybody's favorite pet measure," Manning says.
"There may be some obscure thing in which one physician on a committee has that subspecialized area, but a broader strategy and direction of the program is needed. That subspecialized area may not be highly relevant. You have to navigate through that." Leadership committees should develop specific work plans involving governance and best practices, Manning says.
Even though hospitals may be working with both independent and employed physicians, having a "physician peer pressure [program] can help drive physician performance" regardless of its employment model, Manning says. Although he didn't go into details of what such a program may look like, Manning suggested that each hospital and physician group agree on one that fits their needs. He hinted at what the "peer model" could do.
"We have more transparency around performance and more sharing across physician practices so there is a dialogue and learning from each other," Manning says. For employed and independent groups, the peer pressure "increases interdependency, even though they may remain separate entities." Manning calls the collective group of physicians a "group without walls."
He maintains high regard for Advocate Physician Partners and its work with integrated physician practices. During his tenure, they had acquired physician groups, but Manning cautions that the process is slow going. It takes time to blend new physicians into the team that already exists.
"When I was at Advocate Physicians we had this rather mature program and even with that mature program and lots of training tools and resources, it took about two years to bring the performance of the physicians at new sites up to the level of the average of the rest," he says. "It just takes that long transforming the practices and setting up the bare bones." The IT structure and the legal issues are among the obstacles that have to be overcome.
Still, there's good news. Generally, physicians today are much more engaged than "five or 10 years ago, and there is much more widespread acceptance by physicians that things have to change and this time it's for real," Manning explains.
"Unless a physician is retiring in a couple of years, I'm spending much less time convincing physicians the 'why' about [ACOs and integration with hospitals]. It's more about the 'what' to do, and 'how' to do the best job possible."
Relatively common among hospital patients, malnutrition is often overlooked by physicians. But improving nutrition intervention procedures not only raises quality of care, it can also reduce both hospital costs and readmissions.
The obesity epidemic in this country is rightly of deep concern to physicians and hospitals, but it obscures another deep-seated, but often less talked about problem: malnutrition.
Many people mistakenly believe that only exceedingly thin people are at risk of malnourishment. In fact, inadequate nutrition is an "invisible" condition. Malnutrition is relatively common among patients in hospitals, but is often overlooked by clinical staff.
At least one in three patients may enter a hospital malnourished, which increases their risk for complications and potential costly readmissions, Melissa Parkhurst, MD, FHM, an associate professor in the department of internal medicine at the University of Kansas Medical Center, tells me.
Too often, the malnutrition goes unrecognized and unscreened, she says.
That's also the consensus of The Alliance to Advance Patient Nutrition, a partnership including five healthcare organizations that says it is working diligently to improve patient outcomes by improving nutrition intervention by physicians and hospitals.
Parkhurst is a physician member of the alliance, which includes leaders from the Academy of Medical-Surgical Nurses (AMSN), the Academy of Nutrition and Dietetics (AND), the American Society for Parental and Enteral Nutrition (ASPEN), the Society of Hospital Medicine (SHN) and Abbott Nutrition.
"There's been a lot of attention on the obesity epidemic in the country, but [an assessment of] malnutrition cannot be done visually," says Parkhurst, who is also medical director of the hospitalist section and medical director of the University of Kansas Hospital Nutrition Support Service. "You can have a patient that looks to be visually overnourished, but who could actually be malnourished. You can get caught missing the diagnosis."
And that's the problem, she explains. Too many potential malnutrition diagnoses are being missed. That's why the alliance has issued a "wake-up call" in a report for providers to collaborate and improve nutritional care, Parkhurst says.
For physicians and hospitals, dealing with patients' nutrition is important for improved patient care—and for the financial bottom-line of the healthcare providers themselves, Parkhurst adds.
The alliance reports that malnutrition is "associated with many adverse outcomes," such as increased infection rates, muscle wasting, impaired wound healing and immune suppression. Malnutrition also can result in increased risk of patient falls and overall longer hospital stays.
Many of the adverse outcomes influenced by malnutrition are potentially preventable, the alliance states. Nosocomial infections are one example. About 2 million nosocomial infections occur annually in the U.S., and patients who have them are more likely to spend time in the intensive care unit, "be readmitted, and die as a result," the alliance states.
Hospitalized patients, regardless of body mass, can suffer from "undernutrition" because of their propensity for reduced food intake which could be the result of poor appetite from illnesses, gastrointestinal symptoms, or reduced ability to chew or swallow.
In 2012, physician and healthcare groups defined malnutrition as the presence of two or more of the following characteristics: "insufficient energy intake, weight loss, loss of muscle mass, loss of subcutaneous fat, localized or generalized fluid accumulation, or decreased functional status."
"Processes must be put into place to ensure that appropriate nutrition intervention is provided and patients' nutrition status is routinely monitored," the alliance's report notes. "Without question, nutrition care must be made a high priority and systematized in United States' hospitals."
The alliance is highly critical of nutritional care in hospitals, noting that too often physicians aren't as involved in monitoring nutrition care as they should be. Clinicians and hospital administrators "often fail to prioritize nutrition and fail to recognize" potential impacts.
In addition, hospital oversight of nutrition programs is lagging because of a lack of nutrition education and training, and a dearth of coordination among staff. At many institutions, dietitians are solely responsible for nutrition, but hospitals lack staff or simply don't bother to coordinate the work of dietitians with physicians and nurses.
While nurses oversee patients 24/7, they are often not included in nutrition care because physician "sign-off" is required to implement a nutrition care plan... But physicians may neglect dietitian recommendations because they are focusing on other medical concerns. Doctors also may be uncertain about "specific micronutrient therapy options" in their hospitals.
And while there often is the talk of forming multidisciplinary teams to improve healthcare, communication is lacking with dietitians to improve nutrition, the report adds.
Parkhurst says that hospitals and physicians can work together to improve efforts to dramatically improve nutritional care. The alliance's Nutrition Care Model offers guidelines in which physicians and hospitalists should collaborate with dietitians and nurses to better treat malnourished patients and those at risk for malnutrition.
Physicians need to play a greater role in this important development by redefining clinicians' roles to include nutrition care, and recognize and diagnose all malnourished patients and those at risk, Parkhurst says.
Although nurses are on the front line of care, there is especially a need for physician champions to improve nutritional care by collaboration across disciplines, Parkhurst says.
"I know dietitians who are very well trained and know what needs to be done, but they don't have a voice within their hospital. Just having a physician champion can make a significant stride in improvements, by championing nutrition in their hospital and partnering with a dietitian."
The Joint Commission has recommended nutrition screening within 24 hours of a patient's admission to an acute-care hospital, and frequent intervals throughout hospitalization.
Although it appears that hospitals are conducting the screening, proper follow-up is lacking, Parkhurst says.
In its report, the alliance states that while screening is important to identify at-risk patients, it is often seen as a "superficial observation wherein boxes are checked or unchecked."
"Some hospitals have been more proactive in doing some sort of screening than others," she says. "After that it has become extremely variable from hospital to hospital. In a complex hospital environment, there is so much going on, with patients moving through a system."
While nurses and doctors may be outlining nutritional needs for patients, such as calorie counting, "so many notes are left in 24 hours on (each) patient's chart, the recommendations may get buried in pages of notes, and no one would see them, and the proper intervention doesn't happen," Parkhurst says.
Physicians should not only be involved in nutritional care in hospitals, but also when patients leave, ostensibly to prevent readmissions, Parkhurst says. There should be continued monitoring of patients, what vitamins they may need, or calorie counts or what kind of diet," she says. "It's very important that hospital summaries of a nutrition plan go to the primary care doctor and it's taken care of when patients are discharged from hospitals."
Generally, Parkhurst asserts, improving patient nutrition is another simple healthcare tool that can have a huge impact: on care and economic resources.
As the alliance notes: "Nutrition intervention is a low-risk, cost-effective strategy to help improve quality of hospital care and it's time to join forces to put better nutrition care plans in place."
Bundled payments are one of the financial models emerging from the evolving healthcare marketplace. But a survey of physicians and hospitals shows a significant divergence of opinions about bundling. Practice size is just one factor.
As healthcare moves quickly toward value-based care, bundling is often depicted as the financial model with the most potential for starry-eyed success, in terms of quality and income. Yet a discordant gap in opinions has emerged, as large hospital and physician groups differ dramatically from smaller groups in their attitudes about bundling.
Bundling advocates see the financing formula as a way to get a handle on skyrocketing costs. Under the bundling initiatives, payments are made for multiple services under what is termed an "episode of care" for the patient. Instead of a surgical procedure generating multiple claims from many providers, the entire team is compensated with a bundled payment, on the premise that such a move would provide incentives for more efficient care.
A bundled savings program provides incentives for providers to share in any savings and can increase physician payments with improved patient outcomes. But while bigger players are wildly enthusiastic, those at the other end of the spectrum see it as more "bumbling" than appealing.
The larger groups are chomping at the bit to launch bundling programs, showing many are more excited about this approach than Accountable Care Organizations or patient-centered medical homes. But smaller entities, while seeing benefits of bundling, express trepidation because of what they deem to be the complexity of the payment plan.
That's the finding of a recent Booz & Co. survey of more than 400 physicians and 150 hospital administrators.
Physicians in large groups are generally enthusiastic about bundles, according to the Booz survey. The data show that doctors in larger, multispecialty groups or employed by a health system are more interested in bundles (59%), compared to single specialty practices, 24%. Moreover, a significant number of single practices doubt the efficacy of bundles (44%), compared to how many multispecialty groups hold that view, 27%.
Booz officials concede some physicians are saying "not so fast," especially when it comes to bundles' quality and experience benefits.
Hospitals both large and small reflect the attitudes of physicians about bundling, the Booz survey shows.
About 30% of hospitals surveyed are "pursuing" the model, and another 51% are "exploring" the idea. Some 53% of large health systems with more than $1 billion in annual revenues are beginning to implement bundles. In addition, nearly 64% of those embarking on bundling reported cost savings.
In contrast, 24% of smaller healthcare systems are implementing bundling programs. About 20% of smaller systems see "little efficacy" in bundling.
Proponents of bundling see it as a major tool for achieving goals of the Affordable Care Act. Nearly all large systems are expected to develop bundles. Consumers, too, have high hopes about bundling, with three-quarters finding the concept appealing, according to the Booz survey. I have written about several bundling projects, that are either finding good outcomes, such as in cardiac care or are still being evaluated in cancer care.
Doctors' uncertainty about bundling, (especially those in small groups) may seem puzzling, but there are complex issues surrounding the payment formula, Sanjay B. Saxena, MD, a partner with Booz & Co., based in Sacramento, and a proponent of the payment model, told me.
For one thing, bundles are difficult to put together. "Design is hard, especially getting the risk- and gain-sharing arrangements right," the survey report notes. "Implementation is no picnic either – with persuading physicians to deliver against the bundles, integrating data and running bundles alongside traditional fee-for-service approaches topping the list of challenges."
"You might say, 'why isn't physicians' support widespread?'" Saxena asked. "It seems like a good thing for everyone—higher quality at lower cost. It makes a lot of sense, right?" Despite that, many physicians are so bogged down with other matters—regulatory reform, electronic medical records, the viability of their practices—that they are just weighed down by the idea of a new payment formula, Saxena says.
Then physicians are told: 'we've got to figure out a new model, it's bundled payment, it's different," Saxena says. Physicians are asking: How are we going to deal with it?
And there are other complications. Some providers believe if they are involved in ACOs, there is no reason to undertake bundling. And vice versa. That's a mistake, a Booz official says. "They link together very well, bundles and an ACO," says Brett Spencer, MD, a principal with Booz based in Chicago and a member of the firm's health practice division. When physicians manage their procedures under bundling, that can produce savings for an ACO overall, he adds.
Of the bundles that have been established, nearly 85% have focused on procedure-based treatments. Only 25% of the respondents said their bundles involve chronic care conditions. As more physicians get used to the bundling approach, they can focus on more service lines, Spencer says.
The Booz report notes the importance of bundling attached to more care delivery approaches. "It is clear, however, that chronic conditions need to receive greater attention going forward," the survey states.
Interestingly, as it cheerleads for bundling, Booz has come up with a mixed bag of data, acknowledging that "larger provider organizations are leading the industry's shift and early results are encouraging." The firm adds: "Smaller entities see similar potential benefits but are cautious in the face of resistance, uncertainty, and complexity."
There's no question in his mind, Spencer says, that more providers will adapt to the bundling model. "It's just a question of when it will happen. The speed of adoption will occur as the comfort level grows with it."