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Playing in the Sandbox – Effectively Using RVU’s for Physician Compensation

Brian M. McCook, CPAAMD

Learning Objectives• Refresher on RVU’s

• Benchmark Data Options

• Explore opportunities for RVU compensation models

• Non-clinical considerations

• Wrap-up

Intro to RVU’s• Relative Value Unit – a measure of the

resources required to provide various services.– Time– Level of skill required– Resources needed

• RVU’s are assigned to each encounter, test, procedure or surgery based on CPT codes– Can assign values for non-clinical tasks, if needed.

Total RVU’s Components• Physician work – Time, skill, training and

intensity (w RVU’s)– Compensation agreements tied to work RVU’s

• Practice Expense – Costs of delivering services and maintaining a practice (pe RVU’s)

• Malpractice – Professional liability (mp RVU’s)

Other Important Terms

• Geographic Practice Cost Indices (GPCI)

• Conversion Factor (CF)

• Monetary value = Total RVU’s x GPCI x CF

Example Calculation for CPT Code 99213

Relative Value

Component RVU’s GPCIAdjusted RVU’s CF

Medicare Reimbursement

W RVU 0.97 1.000 0.970 $ 34.0376 $ 33.02

PE RVU 1.03 0.936 0.964 $ 34.0376 $ 32.81

MP RVU 0.07 1.934 0.135 $ 34.0376 $ 4.61

Total 2.07 $ 70.44

Benchmark Data Sources

• Several national surveys are conducted annually– MGMA– Sullivan, Cotter and Associates– Regional and specialty-specific surveys

Using Benchmark Data• Understand how the data was derived,

including type and number of respondents

• May consider blending multiple sources of data

• Be aware of potential inconsistencies that exist in data– RVU data using different fee schedules

Work RVU Compensation Models• Can have various models and criteria – as complex and

creative as you want to be.

• Some sample models:– W RVU Straight Model – W RVU Tiered Model

• May have 2 or more tiers

• Consider tying into individual P&L’s - Must cover direct expenses and allocated share of overhead to be eligible for bonus.

• Be Careful – If too complicated, the physicians will not understand and think they are being cheated!

RVU Sample

Other Items to Consider• Models are transitioning to account for the shift towards

value-based care– Resource Management– Outcomes– Quality

• Possible movement from fee for service to global payments

• Payments for non-clinical time– Administrative Time– Education/Public Speaking

Other Items to Consider • Consider tying compensation to non-

financial factors as well– EHR utilization– Corporate citizenship– Patient satisfaction

• Best models make sure physicians have some “skin in the game”

• Simple can be better!

Components of a sustainable model

• Expectations that must be established for a long-term sustainable model– Financial viability

• Comp model to support this initiative

– Allow for reinvestment • Ramp-up for new doctors• Technology• Recruitment

– Must be a win-win for system and physicians!

Questions

What does all this mean?• Develop a compensation plan that balances effort and

quality.

• Identify the metrics that are important to your practice…and build around them.

• Be transparent.

• Try to keep as simple as possible.

• Make the physician compensation model a recruiting tool for your practice!

AMD Health Care Services

AMD Health Care Services optimizes staff,

resources and revenues for hospitals

and physicians by offering solutions and direction to

complex practice management issues.

We provide an integrated approach to

physician practice success

from the financial, operational,

compliance and strategic perspectives.

Playing in the Sandbox – Effectively Using RVU’s for Physician Compensation

Brian McCook, [email protected]

314-655-5564

www.amdhealthcare.com

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The Patient Centered Medical Home:

An Advanced Primary Care Model Model

Derrick O’Connell, RN, MBA, Lean Six Sigma Black Belt

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The First Patient Centered Medical Home 1967 – American Academy of Pediatrics (AAP) first

termed the “Medical Home” as a centralized location for care of children with special needs with the following attributes:

Accessibility Continuous Comprehensive Family-centered (Patient-centered) Coordinated Compassionate Culturally effective

•

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The Medical Home Model Evolves

2004 – The American Academy of Family Practitioners (AAFP) developed a ‘Medical Home” concept

2006 – The American College of Physicians (ACP) developed an “advanced medical home” concept

2007 – The AAFP, ACP, AOA (American Osteopathic

Association) and the AAP (in conjunction with the NCQA) develop: ‘Joint Principles of the Patient Centered Medical Home’

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The Joint PrinciplesJoint Principles of the PCMH:

Personal Physician – Each patient has a personal physician

Physician Led Team Orientation – A team of health care professionals provides comprehensive care

Whole Person Orientation – The total bio-psychosocial sphere of the person is the focus of health management efforts throughout their complete life cycle

Chronic disease management Acute care Age appropriate care

Care is coordinated across the entire continuum – Care management helps to ensure effective care coordination across all elements of the complex health system

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Joint Principles of the PCMH:

Quality and safety are hallmarks of the PCMH – Engages in continuous quality improvement processes Practices are patient advocates Use of Evidenced Based Medicine and clinical decision support tools Patients actively participate in decision making Patient experience data HIT is used to support optimal patient care Practices go through a voluntary PCMH recognition process Development of a comprehensive QIP

Enhanced access – Patients are able to access care in more ways and at more times

The Joint Principles

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Joint Principles of the PCMH:

Appropriate payment – Payment supports the value- added team concept of the PCMH

**The industry, overall, is moving towards value-based payment methodologies. The PCMH Model of care provides the health care delivery paradigm by which to satisfy the Purchaser Imperative.

The Joint Principles

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Infrastructure

1. Organizational willingness to implement the PCMH

2. Health Information Technology (HIT)

3. Quality Improvement Professional(s)

4. Data analyst

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1. Organizational willingness to implement PCMH

a. Strong Physician Champion(s)

b. Strong Change Agent

c. Strong Governance

i. Quality Improvement Committee

ii. Board support

Infrastructure

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2. Health Information Technology (HIT)

a. Electronic Medical Record

i. Templates with clinical decision support

ii. Evidenced Based Medicine (EBM)Guidelines

b. e-Prescribing

c. Registry functions

d. Lab interfaces

e. Future interface with Health Information Exchange (HIE)

Infrastructure

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3. Quality Improvement Professional(s)

a. Clinical background

b. Development of Quality Improvement Plan

i. Policy & procedure development

c. Data management background

d. Liaison with Data Analyst

i. Registry development

ii. Report development

iii. Clinical performance measurement

e. Process improvement skills

Infrastructure

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4. Data Analyst

a. Ability to create queries in collaboration

with the Quality Improvement Professional

b. Report development

c. Registry development

Infrastructure

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Organizational Standards

There are policies and procedures required for the Patient Centered Medical Home

These are your organizational standards Make them focused and meaningful You will need to measure your organization’s

performance for these standards

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Population Management1. Understand your patient population

a. Stratification

i. ICD-9 Dx – unique patient count

ii. Encounters

iii. Charges

b. Compare to Center for Disease Control

i. National and regional epidemiology

2. Develop Evidenced Based Medicine Guidelines

a. Proven treatment guidelines based upon science

i. Reduce disparities

ii. Industry standards

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3. High-risk sub-population(s)

a. Barriers to Treatment Plan or medication

compliance

b. Multiple co-morbidities

c. High levels or inappropriate resource use

i. Frequent ER or urgent care visits

ii. Non-emergent ER utilization

iii. Frequent hospitalizations

iv. 30-day readmissions

d. Behavioral health histories

e. Advanced age

f. Pediatric at-risk populations

Population Management

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Synergy with Meaningful Use The Patient Centered Medical Home has many

synergies with Stage 1 Meaningful Use

Stage 1 Meaningful Use requirements are embedded in

the 2011 NCQA PCMH Standards

Stage 1 Meaningful Use workflows and data capture

promote the functions of the PCMH

It is advisable to achieve Stage 1 Meaningful Use

before, or concomitantly with your PCMH project

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Standardization The PCMH model and Meaningful Use

Standardized templates in HIT/EMR Standardized clinic workflows

o Application of EBM Guidelineso Doing the same right thing, at the same

right

time, all of the timeo Mistake-proof workflows for the application of

EBM Guidelines Develop condition-specific protocols

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Enhanced Access

1. Same day appointments

2. Timely advice

a. Telephonically

b. Patient portal

3. Access to primary care outside of 8 am – 5 pm, M- F

a. Non-ER venue of care

b. Expanded office hours

c. Urgent Care arrangement

4. 24-hour access to clinical advice

a. Telephonic and patient portal

**The right care, in the right venue, when the patient/customer wants it

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Enhanced Communication Goal is always to collaborate with the patient

Patient-Centeredness

Keep the patient informed about their current status

and future plans/goals /responsibilities

Marketing materials to educate patients/families What is the PCMH How to access care and information Roles and responsibilities

Provide access to EBM Guideline condition-specific

materials

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Care Coordination1. Lab and diagnostic test tracking

2. Coordinate and track consultant and specialist care

3. Following up with patients when they miss

important appointments

4. Tracking and coordinating inpatient and ER

transitions of care

5. HIT interfaces to electronically exchange key clinical

information (may be dependent on HIE deployment)

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Care Management Goal is always to educate, coach and mentor

patients/families to their highest level of self-

management Improve Treatment Plan and medication compliance

Provide access to specifically trained professionals for

chronic disease management education

Notification of gaps in care Age-appropriate Chronic condition

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Performance Measurement & Improvement

Clinical performance Age appropriate or preventive screenings Acute and/or chronic care

Utilization Hospitalizations 30-day readmissions ER utilization

Measure patient/customer experience Annual surveys CAHPS for the PCMH

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Compliance with organizational standards

Track, trend and report all measurements over time

Develop performance goals based upon industry standards/benchmarks or internal incremental improvements

Develop and implement corrective action plans for any performance not meeting goals, standards or customer requirements

Performance Measurement & Improvement

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The Patient Centered Medical Home:

An Advanced Primary Care Model Model

Derrick O’Connell, RN, MBA, Lean Six Sigma Black Belt

PCMH & The TechnologySHIFT

Eric W. HumesKeystone IT Consulting

What is PCMH?(just in case you didn’t know)

PCMH = Patient Centered Medical Home

As defined by the Agency for Healthcare Research and Quality (AHRQ), a PCMH is a medical home that not simply a place but is also a model of the organization of primary care that delivers the core functions of primary healthcare.

5 Core Functions of PCMH

PCMH is built upon the following concepts:

1. Comprehensive2. Patient-centered3. Coordinated4. Accessible5. Quality/Safety

Examples of the 5 Functions

1. Comprehensive care – mental and physical health needs, prevention and wellness, acute and chronic care.

2. Patient-centered – relationship based; recognizes that a patient’s family is part of their care team.

3. Coordinated care – increasing communication across patient ~ family ~ hospital ~ clinics ~ community services.

4. Accessible services – shorter waiting times for urgent needs, enhanced hours, 24x7 phone/internet based support..

5. Quality / Safety – evidenced-based medicine, clinical decision support tools, reduced errors, measuring/responding to patient satisfaction.

Technology’s Role in PCMH

Health IT (HIT) can help to achieve each these fundamental goals but primarily relates to:

Coordinated careCommunication between members of the care team

Accessible ServicesCommunication between patient and care team

Quality / SafetyClinical data analytics tools, EMR systems, reduced errors with eRx, data trending, dashboarding

Technology’s Role in PCMH

HIT can support the PCMH model by collecting, storing, and managing personal health information, as well as aggregate data that can be used to improve processes and outcomes.

HIT can also support communication, clinical decision-making, and patient self-management.

Technology’s Role in PCMH

Question: Will significant investment in promoting the adoption of health information technology (IT) and meaningful use of electronic health records (EHRs) through the Health Information Technology for Economic and Clinical Health (HITECH) Act enable primary care practices to become patient-centered medical homes (PCMHs)?Answer: No. While the adoption and meaningful use of EHRs help support some aspects of the PCMH model, HITECH programs and other current Federal legislation are necessary but not sufficient for driving widespread adoption of the medical home model. (Source: AHRQ)

The Needed SHIFT

HITECH offers some policy options that could ensure EHRs are implemented in a way that supports primary care transformation. These could include the following:1. Adding explicit functionalities that directly

support the PCMH model to the recently released EHR certification standards and criteria.

2. Adding EHR meaningful-use requirements that support the PCMH model for stages 2 and 3 of the EHR Incentive Program.

HITECH is Necessary, but Not Sufficient

HITECH is not sufficient to support the PCMH model.

HITECH laid important groundwork to support the PCMH model. However, its goals and processes were not linked specifically to this model. Without explicit linkage, HITECH will miss opportunities to support the transformation of primary care practices.

Three Major Limitations of HITECH Act

1. The legislation does not specify from either a technical or a legal perspective how primary care providers will be able to communicate with the practice’s “medical neighborhood”.

2. The meaningful-use concept does not entirely overlap with the PCMH’s core principle of comprehensive, team-based care and collaboration among staff within a practice. MU certification criteria for EHRs do not explicitly support

the PCMH model.3. HITECH’s requirements do not address improved

access to care [via digital means].

The CMS Can Still Adjust

Fortunately, as the CMS releases Incentive Program regulations over time, they can create the needed linkage between Meaningful Use stages 2 and 3 and the PCMH concept.

Expand the scope of the Regional Extension Centers (RECs) to provide education and technical assistance to eligible Primary Care Providers on the PCMH concept.

Critical HIT Capabilities for PCMH

Provide easily accessible services during and outside normal business hours through multiple communication mediums. Have systems to identify patients needing specific interventions and to manage population segments (e.g. complex health needs, post hospitalization, etc). Coordinate care through organized and efficient processes that facilitate timely bi-directional information exchange between health information databases.

Critical HIT Capabilities for PCMH

Utilize key elements of technology (e.g. e-prescribing, clinical decision support, registries, secure email, etc.) to deliver safe, high quality, efficient health care.Engage patients in developing action plans with trained healthcare professionals.Track and trend performance of the practice and individual clinicians to improve quality/outcomes.

HIT plays a central role in enabling the functions of a patient centered medical home, or any future-state healthcare model.

Comprehensive HIT Infrastructure is Key

Movement away from isolated IT applications and towards comprehensive HIT infrastructure.HIT must integrate into/support workflowHIT must enable the necessary functions of delivering care and managing the population

usability is key; structural capability alone is not enoughEnable improved non-visit based access for consumers to receive care, information, and advice from the appropriate care team member.Access for consumers to pertinent educational material. (Online patient education - videos, presentations, FAQs)

Comprehensive HIT Infrastructure is Key

Enablement of self-management of care through coaching, monitoring, tools, communication, peer groups, etc.

There is significant development work being done in this area already with interactive secure patient web portals and smart phone apps that connect patients more closely with their health record and care providers.

Facilitate better customer service - allowing patients to receive care when they want it and how they want it, thus fostering better relationships between patients and physicians.

Additional Resources

Additional resources available at:

http://pcmh.ahrq.gov

Questions?

PCMH & The TechnologySHIFT

Eric W. HumesKeystone IT Consulting

Panel of Experts

Thank you for attendingHealthcare Stimulus 101 - May 2012

Next EventCape Girardeau – Dexter’s BBQThursday, September 1311:00am to 2:30pm

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important issues to you. Thanks in advance!http://www.leagueofhealthcareexperts.com/survey