CMS is currently testing programs of alternative models for payment, including gainsharing around bundled payments for episodes of care and accountable care organizations. Testing of these initiatives is meant to incentivize care redesign, engage and protect beneficiaries and diffuse best practices which might create changes to the Medicare fee-for-service program.
The Center for Medicare and Medicaid Innovation is authorized to test innovative payment and service delivery models that have the potential to reduce program expenditures while maintaining or improving the quality of care for beneficiaries. As a result, many hospitals and health systems are considering gainsharing and other alternative payment models in collaboration with their physicians. Generally, gainsharing has been more popular with primary care physicians and specialists, but gainsharing arrangements are possible with any physician who practices at a hospital, as all physicians impact the quality and cost of care. Here, Ronald W. Stunz, MD, FACEP, medical director of MMP, discusses considerations for including emergency physicians in gainsharing arrangements.
Question: What are some positives and negatives of gainsharing arrangements?
Dr. Ronald Stunz: One of the positives is that episode payments encourage physician and hospital alignment — most likely to lower the costs of delivering healthcare. Hospitals are keen on physicians sharing concerns to reduce unnecessary utilization and supplies while improving patient safety. Physicians are happy because they can gainshare; however, physicians are also skeptical that the lump sum allows the hospital too much control over physician rates and possibly encourages hospitals to withhold certain services to keep costs down. Further, in the prevailing medical-legal environment, physicians look skeptically on any potential change in practice pattern or possible protocol-driven loss of professional autonomy that might expose them to a lawsuit. Each side has concerns about control and the degree of cooperation they will face in a partnership, and specifically independent hospital-based emergency department practices.
Q: What is the role of emergency medicine in a gainsharing program?
RS: The thrust of these programs requires a gatekeeping role on the behalves of primary care physicians and selected specialists. Emergency department physicians can and should be primarily involved since the bulk of hospital admissions lies in their services. Emergency department physicians can contribute to cost savings by (1) expediting admissions, (2) optimizing ED time and (3) avoiding unnecessary admissions and readmissions. These opportunities could mandate the presence of ED directors as key stakeholders in the development of the treatment protocols. Depending on local politics and other confounding factors, the ED could potentially be viewed as an outsider in the process and have unrealizable expectations imposed on it. Without ED representation to sculpt the processes themselves and actively contribute to the analysis of the results, this reality can dovetail into eventual losses in reimbursement for ED physicians.
ED physicians also have little experience with bundled reimbursement, beyond reverting to the old approach to managed care when hospitals usually had the final word in terms of where money was allocated. The ED "piece of the pie" has to be adjudicated in function of the diagnostic categories being utilized. The ACE Demonstration mostly addresses admissions (or, alternatively, observation), so the basic entry-level ED reimbursement cut has to approach or exceed 99285 reimbursement.
Q: Is gainsharing easier for specialists as opposed to ED physicians?
RS: The notion of gainsharing may be easier for specialists to implement than ED physicians, particularly for certain MS-DRG patient classes. To illustrate, how would gainsharing be used to substantively change the ED physician's patient care for a hip fracture patient who will be treated and cared for in anticipation of hospital admission? Put another way, how should episode payments affect the way in which ED physicians do hip fracture work-ups? If ED physicians are really the beginning of the "episode of care" and so early in the process, ED practices should be aware of their options as they research and propose gainsharing arrangements.
Q: How should emergency physicians propose gainsharing arrangements?
RS: Gainsharing can be a component of the several "payment reform" proposals presented under a few models. Generally, these arrangements consist of the hospital or providers distributing gainsharing payments to physician(s) and/or other practitioners, and payments represent a share of the gains resulting from collaborative efforts to improve quality and efficiency. One of CMS' payment reform proposals is the Center for Medicare & Medicaid Innovation's Bundled Payments for Care Improvement program. Under this program, providers can select to participate in one of four models, each with slightly different guidelines. Examples of useful bundled payment models for emergency department practices include:
Q: Are there strict program requirements for these arrangements?
RS: Gainsharing arrangements must meet certain design criteria to be eligible for participation in this initiative. These parameters, found on the CMS website, are designed to ensure that care is not inappropriately reduced, that the quality of care remains constant or is improved, that there are not inappropriate changes in utilization or referral patterns, and to guard against fraud, waste and abuse. Among other requirements, applicants must discuss in detail how gainsharing will support care redesign to achieve improved quality and patient experience and anticipated cost savings by describing their methodology for the sharing of gains between or among the hospital or other care settings (e.g., post-acute care facility) and physicians and other non-physician practitioners.
Q: How is payment met in such arrangements?
RS: Payments cannot be based on the volume or value of referrals or business otherwise generated between hospital and physician, but payments based on achieved savings are permitted. Payments to physicians and non-physician practitioners also cannot exceed 50 percent of the amount that is normally paid to physicians and non-physician practitioners for the cases included in the gainsharing initiative. Either way, the applicant must include a comprehensive plan regarding how they will distribute financial rewards in their application.
Q: How can emergency physicians achieve performance bonuses?
RS: Gauging the performance bonus can become very situational and therefore harder to parse, but demonstration of adherence to protocols and other necessary criteria should translate into a fixed percentage that is more precise or predictive. In order to affect their reimbursement, emergency physicians will need to flesh out existing reimbursements for the diagnostic categories in question and use that as a floor for the performance bonus pool. The ED director or ED group should work closely with the hospital, ask the right questions and understand all areas of the arrangement if asked to consider such a program.
Q: How can emergency medicine groups work with their hospitals to achieve optimal benefits in a gainsharing program?
RS: The challenge in hospital and group collaboration is to align the interests as closely as possible and keep in mind that the hospital is acting in its own best interest. It is always best to work with an experienced attorney to safeguard all arrangements in writing. While it is essential to build a healthy relationship with the hospital, groups should remember that business will always trump relationships given the turnover of hospital administrators, and close relationships may not transfer from old staff to new staff.
Ronald W. Stunz, MD, FACEP, is the medical director of MMP. In this role, he delivers documentation in-service sessions with emergency physicians and has been with MMP for more than seven years after a 25-year career as a practicing physician. Dr. Stunz has served in a number of hospital administrative capacities, including chairman of the Department of Medicine for Bryn Mawr Hospital, and chairman of the Department of Emergency Medicine for Main Line Health.
Opportunities in the New Bundled Payment Initiative
The Center for Medicare and Medicaid Innovation is authorized to test innovative payment and service delivery models that have the potential to reduce program expenditures while maintaining or improving the quality of care for beneficiaries. As a result, many hospitals and health systems are considering gainsharing and other alternative payment models in collaboration with their physicians. Generally, gainsharing has been more popular with primary care physicians and specialists, but gainsharing arrangements are possible with any physician who practices at a hospital, as all physicians impact the quality and cost of care. Here, Ronald W. Stunz, MD, FACEP, medical director of MMP, discusses considerations for including emergency physicians in gainsharing arrangements.
Question: What are some positives and negatives of gainsharing arrangements?
Dr. Ronald Stunz: One of the positives is that episode payments encourage physician and hospital alignment — most likely to lower the costs of delivering healthcare. Hospitals are keen on physicians sharing concerns to reduce unnecessary utilization and supplies while improving patient safety. Physicians are happy because they can gainshare; however, physicians are also skeptical that the lump sum allows the hospital too much control over physician rates and possibly encourages hospitals to withhold certain services to keep costs down. Further, in the prevailing medical-legal environment, physicians look skeptically on any potential change in practice pattern or possible protocol-driven loss of professional autonomy that might expose them to a lawsuit. Each side has concerns about control and the degree of cooperation they will face in a partnership, and specifically independent hospital-based emergency department practices.
Q: What is the role of emergency medicine in a gainsharing program?
RS: The thrust of these programs requires a gatekeeping role on the behalves of primary care physicians and selected specialists. Emergency department physicians can and should be primarily involved since the bulk of hospital admissions lies in their services. Emergency department physicians can contribute to cost savings by (1) expediting admissions, (2) optimizing ED time and (3) avoiding unnecessary admissions and readmissions. These opportunities could mandate the presence of ED directors as key stakeholders in the development of the treatment protocols. Depending on local politics and other confounding factors, the ED could potentially be viewed as an outsider in the process and have unrealizable expectations imposed on it. Without ED representation to sculpt the processes themselves and actively contribute to the analysis of the results, this reality can dovetail into eventual losses in reimbursement for ED physicians.
ED physicians also have little experience with bundled reimbursement, beyond reverting to the old approach to managed care when hospitals usually had the final word in terms of where money was allocated. The ED "piece of the pie" has to be adjudicated in function of the diagnostic categories being utilized. The ACE Demonstration mostly addresses admissions (or, alternatively, observation), so the basic entry-level ED reimbursement cut has to approach or exceed 99285 reimbursement.
Q: Is gainsharing easier for specialists as opposed to ED physicians?
RS: The notion of gainsharing may be easier for specialists to implement than ED physicians, particularly for certain MS-DRG patient classes. To illustrate, how would gainsharing be used to substantively change the ED physician's patient care for a hip fracture patient who will be treated and cared for in anticipation of hospital admission? Put another way, how should episode payments affect the way in which ED physicians do hip fracture work-ups? If ED physicians are really the beginning of the "episode of care" and so early in the process, ED practices should be aware of their options as they research and propose gainsharing arrangements.
Q: How should emergency physicians propose gainsharing arrangements?
RS: Gainsharing can be a component of the several "payment reform" proposals presented under a few models. Generally, these arrangements consist of the hospital or providers distributing gainsharing payments to physician(s) and/or other practitioners, and payments represent a share of the gains resulting from collaborative efforts to improve quality and efficiency. One of CMS' payment reform proposals is the Center for Medicare & Medicaid Innovation's Bundled Payments for Care Improvement program. Under this program, providers can select to participate in one of four models, each with slightly different guidelines. Examples of useful bundled payment models for emergency department practices include:
- Model #1: Retrospective payment models for the acute inpatient hospital stay only.
- Model #2: Retrospective bundled payment models for hospitals, physicians and post-acute providers for an episode of care consisting of an inpatient hospital stay followed by post-acute care.
- Model #4: Prospectively administered bundled payment models for hospitals and physicians for the acute inpatient hospital stay only. (This model is similar to CMS' Acute Care Demonstration project).
Q: Are there strict program requirements for these arrangements?
RS: Gainsharing arrangements must meet certain design criteria to be eligible for participation in this initiative. These parameters, found on the CMS website, are designed to ensure that care is not inappropriately reduced, that the quality of care remains constant or is improved, that there are not inappropriate changes in utilization or referral patterns, and to guard against fraud, waste and abuse. Among other requirements, applicants must discuss in detail how gainsharing will support care redesign to achieve improved quality and patient experience and anticipated cost savings by describing their methodology for the sharing of gains between or among the hospital or other care settings (e.g., post-acute care facility) and physicians and other non-physician practitioners.
Q: How is payment met in such arrangements?
RS: Payments cannot be based on the volume or value of referrals or business otherwise generated between hospital and physician, but payments based on achieved savings are permitted. Payments to physicians and non-physician practitioners also cannot exceed 50 percent of the amount that is normally paid to physicians and non-physician practitioners for the cases included in the gainsharing initiative. Either way, the applicant must include a comprehensive plan regarding how they will distribute financial rewards in their application.
Q: How can emergency physicians achieve performance bonuses?
RS: Gauging the performance bonus can become very situational and therefore harder to parse, but demonstration of adherence to protocols and other necessary criteria should translate into a fixed percentage that is more precise or predictive. In order to affect their reimbursement, emergency physicians will need to flesh out existing reimbursements for the diagnostic categories in question and use that as a floor for the performance bonus pool. The ED director or ED group should work closely with the hospital, ask the right questions and understand all areas of the arrangement if asked to consider such a program.
Q: How can emergency medicine groups work with their hospitals to achieve optimal benefits in a gainsharing program?
RS: The challenge in hospital and group collaboration is to align the interests as closely as possible and keep in mind that the hospital is acting in its own best interest. It is always best to work with an experienced attorney to safeguard all arrangements in writing. While it is essential to build a healthy relationship with the hospital, groups should remember that business will always trump relationships given the turnover of hospital administrators, and close relationships may not transfer from old staff to new staff.
Ronald W. Stunz, MD, FACEP, is the medical director of MMP. In this role, he delivers documentation in-service sessions with emergency physicians and has been with MMP for more than seven years after a 25-year career as a practicing physician. Dr. Stunz has served in a number of hospital administrative capacities, including chairman of the Department of Medicine for Bryn Mawr Hospital, and chairman of the Department of Emergency Medicine for Main Line Health.
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