+ Passionate about your Success California Orthopaedic Association Annual Meeting April 19, 2012 Presented by: Michael J. McCaslin, CPA Health Care Team Private Practice Perspective & Delivery Model Impacts
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+ Passionateabout yourSuccess
California Orthopaedic Association Annual MeetingApril 19, 2012
Presented by:
Michael J. McCaslin, CPAHealth Care Team
Private Practice Perspective & Delivery Model Impacts
PRIVATE PRACTICE PERSPECTIVE &
DELIVERY MODEL IMPACTS
What Environment Are We In? &
What is Different Today?
The Health Care Environment
1990s 2010+PHOs ACOsCapitationShared SavingsGPWW Umbrella/Divisional MergerIntegrated Delivery Integrated Health Care
System SystemPCP Gatekeeper PCP Medical HomeBundled Payments Bundled Payments Volume ValuePPMC ????
Competitive Positions
Insurance Companies have Anti-Trust Protection (at least to date for most part)Hospitals Use –
Tax Exempt Financing Same Service Payment Differentials (HOPD/APC)AHA Protects All Plus Hides Behind “Tax Exemption” to Generate Profits Without Tax Consequences (Income taxes, Property taxes, Real Estate taxes & Sales taxes)
Competitive Positions
Physicians Constrained by More Federal Regulation Known to Mankind Over Limitation of Practicing in “Group Practice” & Ownership of Hospitals, GPOs, PODs, etc.
One of Most Significant Barriers to Successful Strategies – Stark and Anti-Kickback Statute
What are the Buzz Words or Phrases?
Disease Management /Chronic Care ManagementCare Coordination (Fewer Hospital Admissions, Fewer Re-admissions)Value Based PaymentsMedical HomesManagement of Targeted PopulationsEvidence Based Medicine
What are the Buzz Words or Phrases?
Targeted Cost SavingsDischarge PlanningInteroperable EHRImproving Health of PopulationsReducing per Capita CostBundled Payments
What are the Private Practice Options?
Competitive Positions
Physician to Physician Only Strategies: SoloSmall GroupMerger with Other Physicians/Group –“All In”Umbrella/Divisional Merger – “Kind of In”
INTEGRATION STRUCTURE
ManagementServices
Organization / CBO
Partially Integrated Model
GroupA
GroupD
GroupE
GroupC
GroupB
Old PCA
Old PCE
Old PCB
Old PCC
Old PCD
ASCA
RealEstateLLC D
All RevenueAll Expenses
One Division = Entity
Fully Integrated Model
Old PCA
Old PCE
Old PCB
Old PCC
Old PCD
ASCA
RealEstateLLC D
Assets
Assets
Assets
Assets
Assets
INTEGRATION STRUCTURE
Physician Hospital Alignment Strategies
Medical DirectorshipsService Line Co-ManagementGain SharingBundled PaymentsPseudo EmploymentClinical Integration ACOs (Accountable Care Organizations)Employment
MANAGEMENT STRUCTURE
PhysicianGroup(Or LLC)
“Manager”
HOSPITAL
ContractedManagement
Services
Fixed & IncentiveCompensation
Single Group and Hospital“Management Services Agreement” Structure or “MSA”
MANAGEMENT STRUCTURE
ManagementCompany
LLC“Manager”
HOSPITAL
ContractedManagement
Services
Fixed & IncentiveCompensation
Groups
Multiple Groups and Hospital“Management Services Agreement” Structures or “MSA”
Ownership
MANAGEMENT STRUCTURE
ManagementCompany
LLC“Manager”
HOSPITAL
ContractedManagement
Services
Fixed & IncentiveCompensation
Groups
Multiple Groups and Hospital
OwnershipOwnership
“Co-Management” Structure
MANAGEMENT STRUCTURE
ManagementCompany
(LLC)“Manager”
HOSPITALPhysicianOwners
OrthopedicService Line
Steering Committee
Senior LeadershipCEO / COOCMO / CNO Service Line Manager
Facilitator / Director
Clinical MedicalDirectors (“CMD”)
ContractedManagement
Services
Fixed & IncentiveCompensation
Sub-Committees
HospitalRepresentatives
PhysicianRepresentatives
Alignment Strategies
Bundled Payment / Pricing Initiative
Bundled Payment Pilot
Type of Services Included in Bundle: Physicians’ ServicesInpatient hospital Services (Episode anchor)Inpatient Hospital Readmission ServicesLong-term Care Hospital Services (LTCH)Skilled Nursing Facility Services (SNF)Home Health Agency Services (HHA)Hospital Outpatient Services
Bundled Payment Pilot
Type of Services Included in Bundle: (Cont’d)Independent Outpatient Therapy ServicesClinical Laboratory ServicesDurable Medical EquipmentPart B Drugs
Payment from CMS to Providers:Traditional FFS (Ultimate Reconciliation with Predetermined Target Price)
ALIGNMENTSTRATEGIES
• Employment Model
PhysicianGroup
Entity / PC
HOSPITAL
This Entity “Winds Down”
Sells Assets
Moves Staff
Moves Physicians
Physician Enterprise
Employed Physicians and Staff
Foundation
ALIGNMENTSTRATEGIES
• PSA Models (Pseudo Employment)– MSA / Reverse MSO
PhysicianGroup
Entity / PC
HOSPITAL
This Entity Continues Only
as MSO
LEASES Assets PhysicianEnterpriseLEASES Staff
Moves Physicians
Employed Physicians
MSAManagement
Services Agreement
ALIGNMENTSTRATEGIES
• PSA Models (Pseudo Employment)– PSA Model
PhysicianGroup
Entity / PC
HOSPITAL
Sells Assets
PhysicianEnterprise
Moves Staff
LEASES Physicians
Employed Staff
This Entity Continues Only
as PSO
PSAProfessional
Services Agreement
Foundation
ALIGNMENTSTRATEGIES
• PSA Models (Pseudo Employment)– Combined PSA / MSA
PhysicianGroup
Entity / PC
HOSPITAL
This Entity Continues as MSO / PSO
LEASES Assets
PhysicianEnterprise
LEASES Staff
MSAManagement
Services Agreement
LEASES Physicians
PSAProfessional
Services Agreement
Foundation
ALIGNMENTSTRATEGIES
• Employment Model
PhysicianGroup
Entity / PC
HOSPITAL
This Entity “Winds Down”
Sells Assets
Moves Staff
Moves Physicians Physician Enterprise
Employed Physicians and Staff
Foundation
CONCLUSION
“Insanity is Doing the Same Thing
You Have Always Done and Expecting a Different Outcome.”
Albert Einstein
CONCLUSION
“The Problem that Exists in the World Today Cannot be Solved by the Same Level of Thinking
Used that Created Them.”Albert Einstein
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