PYA Monitors Topics on Healthcare Radar at AlaHA

Page 0 June 12, 2014

Prepared for The Alabama Hospital Association Annual Meeting

ICD-10…

What Now?

The Alabama Hospital Association – Annual Meeting

June 12, 2014



Agenda

• Updated ICD-10 timeline

• Managing your ICD-10 project

– Planning

– Communications

– Testing

– Training

Planning

Communications

Training

Testing



There’s A Code For That!

Source: http://www.youtube.com/watch?v=GWJQSmqRLRk



There’s A Code For That!

Source: http://www.youtube.com/watch?v=yKYwr31s4bk



Updated ICD-10 Timeline PYA

May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

Planning

Identify resources

Create project team

Assess effects

Create project plan

Secure budget

Communications

Inform staff

Contact vendors

Contact payers

Monitor vendor prep

Monitor payer prep

Testing

High-level training for

test team

Level 1: internal

Level 2: external1

Comprehensive Training

Documentation

Coding

2October 1, 2015 is the anticipated compliance date for ICD-10.

2014 2015

G

O

L

I

V

E

Confirm ongoing practice schedule to correspond with

new "go live"2 date

1Monitor external testing periods, especially updates regarding CMS limited testing currently CANCELLED for July 21 - 25, 2014 for selected volunteers.



ICD-10 Project Overview

Successful Go-Live

Training

Testing

Communications

Planning



• Plan for dual ICD-9 and 10 codes for a brief period to address services rendered before October 1, but discharged after October 1.

• Monitor physician documentation to ensure ICD-10 compliance.

• Monitor impact on claim-processing activity, claim denials, and rejections.

• Audit coder productivity and accuracy.

• Monitor patient satisfaction.

• Post-transition review:

– What’s working?

– What needs fixing?

• Schedule 30-day post-conversion claims assessment.

ICD-10 Go Live, The Day After…



Questions?



Value-Based Payments

What’s Up With That?


June 12, 2014



What is a

“Value-Based Payment” Model?

Value-Based Payment:

A payment model which rewards healthcare providers

for meeting certain predetermined performance

measures related to quality and efficiency.

Efficiency: The state or quality of achieving

maximum productivity with minimum wasted

effort or expense. Quality: The standard of something as

measured against other things of a similar

kind; the degree of excellence of something

“quality of life” also the general excellence of

standard or level. Value: The regard that something is held to

deserve; the importance or preciousness of

something: “Your support is of great value.”

Page 10 June 12, 2014


Fundamentals Driving

Clinical Integration and VBP

Page 11 June 12, 2014


Summary of Hospital VBP

Hospitals are not only

encouraged to promote

quality of care and patient

satisfaction, it is affecting

their

bottom line!

• In FY14, a payment reduction

of up to 1.25%.

The result of

these

measures are

available to

everyone.

Better

performance

equates to

better payments

(and ideally,

better outcomes

for patients).

Summary of

Hospital VBP

Page 12 June 12, 2014


Physician Value-Based Purchasing

Similar to Hospitals

Physicians are encouraged to place value and performance above production.


Physician payments from CMS will be affected by the reporting and benchmarking of these measures.


Physicians are accountable for reporting on quality measures.

Page 13 June 12, 2014


Why Report?

•2015:

Based on FY 2013 reporting.

EPs who do not report under

PQRS subject to payment

adjustment of 1.5%.

•2016 and Beyond:

Based on 2014 reporting and

beyond.

EPs who do not report under

PQRS subject to payment

adjustment of 2.0%.

Payment

adjustment based

on percentage of

total estimated

Medicare

Physician Fee

Schedule allowed

charges:

EP –

Eligible

Providers

Page 14 June 12, 2014


More Reasons to Report

Physician Feedback Reports

FY15 implementation of physician feedback report adjustments

for physician practices with greater than 100 physicians.

FY17; physician feedback reports will be sent to all physicians in

the country at which point payment adjustments will be made

(similar to Hospital value-based purchasing).

Page 15 June 12, 2014


Why Clinical Integration and VBP?

• Today’s volume-based, fee-for-service system is

based on independence: each provider is paid for

providing a discrete service, without regard to

others performance.

• Tomorrow’s value-based payment systems,

however, will demand interdependence: providers

will be rewarded for quality and efficiency achieved

through collaborative care

Page 16 June 12, 2014


Questions?

Page 17 June 12, 2014


Thank You!

Nancy McConnell

Principal

Pershing Yoakley & Associates, P.C.

(404) 266-9876

[email protected]

www.pyapc.com

Page 18 June 12, 2014


Hospital-Physician Transaction –

The Compliance Wheel


June 12, 2014

Page 19 June 12, 2014


Alignment Perspectives: Physicians

• Financially squeezed

• Decline in reimbursement and loss of income

• Obtaining malpractice coverage at reasonable rates

• Inability or unwillingness to recruit to level that hospitals demand

• Quality of life

• Increasingly complex government oversight

• Overhead and working capital requirements

• Quality pressures

• Healthcare reform

Page 20 June 12, 2014


Alignment Perspectives: Hospitals

• Increasing payer and public emphasis on standardization, integration,

and consolidation of services in order to drive quality initiatives through

outcomes and evidence- based medicine

• Seeking efficiencies

• Diversifying and focusing on outpatient and wellness care

• Expanding into rural communities where there are not enough primary

care and key specialist physicians to service the community’s healthcare

needs

• Experiencing physician shortages in key specialties

• Competition from physician owned outpatient centers

Page 21 June 12, 2014


Alignment Perspectives: Hospitals

• Healthcare reform and potential for global reimbursement

• Increase ability to recruit and retain high quality physicians to

the community

• Fill gaps in areas such as call coverage, where physicians are

increasingly unwilling (due to lifestyle demands and/or practice

economics) or unable (due to subspecialization) to provide

emergency room call

• Negotiate better rates with commercial payers

Page 22 June 12, 2014


Alignment Perspectives: Payers and

Healthcare Reform Payers

• Consumers more aware of price and quality.

• Baby boomers moving to the Medicare program.

• Medicare and other payers expecting “value” for payment.

• Commercial insurers under pressure from employers to reduce cost.

• Consumers picking up more of the healthcare “tab.”

Healthcare Reform

• Reimbursement changes accelerating alignment of hospitals and physicians.

• Tightening of resources requiring new approaches to the medical staff model.

• Quality, safety, and transparency will affect strategic and operational decisions.

• Capital and IT investments will be dictated by availability of capital resources and government incentives.

Page 23 June 12, 2014


Multiple Models for Collaboration

• Contracts

– Physician employment

– Recruitment agreements

– Professional service agreements (PSA)

– Practice acquisition agreements

– Practice support agreements

– Clinical research agreements

• Non-Clinical Joint Ventures

– Facility development/MOB ventures

– Space & equipment leasing companies

– Management companies

– HIT ventures

• Contractual Venture Models

– Service line co-management

– Pay for quality/pay for performance

– Block leasing

– Foundation model

– Centers of Excellence models

– Modified under arrangements models

• Clinical Joint Ventures

– ASCs

– Ambulatory facilities

Page 24 June 12, 2014


Multiple Models for Collaboration

Physician

Advisory

Council

Extent of Physician Integration High

High

Co

sts

Lease

Agreement

Low

Recruitment

Assistance

Clinical

JV

Professional

Services

Agreement Co-

Management

Arrangements

ED Call

Pay

Medical

Director

Management

Services

Agreement

Employment

Foundation

Model

Page 25 June 12, 2014


The Compliance Wheel

Physician-Hospital

Alignment

Strategic/Business Planning

Physician needs assessments

Community health needs assessments

Programmatic

Legal and Regulatory

Transaction structure

Legal opinion

Term sheet/contracts Due Diligence

Financial

Operational

Regulatory compliance

Documentation

FMV

Commercial Reasonableness

Agreements

Need

Regular Audit & Monitoring

Agreements

FMV

Need

Page 26 June 12, 2014


Questions?

Page 27 June 12, 2014


Thank You!

Tynan Olechny

Principal


(404) 266-9876

[email protected]

www.pyapc.com

Page 28 June 12, 2014


The Osler Circle:

Differentiating Physicians for

Competitive Advantage


June 12, 2014

Page 29 June 12, 2014


Today’s Discussion 1. Strategic Coherence – what is it

and why does it matter?

2. Current context and limiting

factors.

3. Coherence to what end?

(Differentiation)

4. Sir William and the Five “A”s.

5. Putting it all together – The Osler

Circle.

6. Wrap Up and Questions.

Page 30 June 12, 2014


Strategic Coherence (And What’s Holding Us Back?)

Limiting Factors

• In Place: EAs, Non-Competes, Comp

Plans, EHR – We’re Done! Wait…we’re

not?

• Clarity on what remains = continued

default defensive strategy.

• Demonstrating the Value-Add.

Strategic Coherence:

“Organization-wide collaboration, coordination and allocation of

resources to create unique, valuable and sustainable advantages.”

The ability to accomplish as a group, things not possible to

accomplish as individuals.

The Story of the Blind Men and the Elephant

Page 31 June 12, 2014


Strategic Coherence (contd.)

Coherence Differentiation Value

Generation Competitive Advantage

STRATEGY

Coherence to what end and along what path?

• Answer: Differentiation that creates value

• Competing to be different as a conscious strategy

• If this sounds familiar…it is

Page 32 June 12, 2014


Competitive Physician

Differentiation

“Over time, if someone is taking your market share overall, or in a particular

specialty…You’ll find there is always a good reason. Most likely it is your poor service,

your bad results, or delayed access.” - Fred Loop, Former CEO of the Cleveland Clinic

Page 33 June 12, 2014


The “5 A”s of Physician

Differentiation

1. Availability

- Time vs. patient appointment, vs. waiting room vs. specialist

follow up with PCP.

- Secure Patient Portal and Next Day Appointment availability.

2. Affability

- “When I am your doctor, I try to imagine the kind of doctor I’d like

if I were you. Then I try to be that kind of doctor.” – Charles

Mayo

3. Ability

- Collectively represented by the physician’s experience, training,

outcomes, and reputation and extends to and is impacted by

perception of institutional reputation.

Sir William Osler, 1849 – 1919

Considered by many to be “The

Father of Modern Medicine” and

creator of the medical

residency.

Success in practice depends on: “Availability, affability, and ability, in

that order” – Sir William Osler

Page 34 June 12, 2014


The “5 A”s of Physician

Differentiation Contd.

4. Affordability

- The cost of care remains obscure and fragmented and

healthcare consumers have been insulated from the realities of

price for generations.

- However, price sensitivity and transparency is increasing on all

fronts and organizations are beginning to position physicians on

affordability.

5. Accountability

- Accountability is not new to medicine, however two new forms

are emerging:

1) Accountability on “value” of care delivered (combination of

outcome and costs).

2) For hospital sponsored/affiliated physicians, accountability to

organization mission, values, and vision.

Sir William Osler, 1849 – 1919

Considered by many to be “The

Father of Modern Medicine” and

creator of the medical

residency.

A couple of humble suggestions for 2014:

Page 35 June 12, 2014


Putting it All Together:

The Osler Circle

Page 36 June 12, 2014


Wrap Up and Take-Aways • Ultimately, no hospital asset is as valuable as

physician differentiation.

• Competitive differentiation of the physician

enterprise (employed and independent) ought

to be a major strategic consideration.

• Osler’s circle can help define where to focus

that time and attention.

• Only by addressing the creation of unique value

will the investments of time, talent and treasure

in the physician enterprise provide sustainable

returns.

* A full article on this subject to be published in Hospitals and Health Networks Online in June 2014.

Page 37 June 12, 2014


Questions?

Page 38 June 12, 2014


Thank You!

Chris Beckham

Senior Manager


(706) 248-6131

[email protected]

www.pyapc.com

PYA Monitors Topics on Healthcare Radar at AlaHA

Healthcare

sir william

payment adjustment

osler circle

medical residency

hospitals

limiting factors

strategic

modern medicine