Why clinical documentation is the missing link to value-based reimbursement

The key to successfully making the jump from the old era of healthcare — one where fee-for-service is king — to the new era of healthcare — one where transparency, consumerism and value dominate — may actually be as simple as improving clinical documentation, according to Anthony Oliva, DO, vice president and CMO of Nuance Healthcare.

"For those who thought, 'Maybe we can just hold out and [value-based care] will all go away,' it's never going to go away; it's only going to get worse," Dr. Oliva said at the Becker's 2nd annual CIO/HIT + Revenue Cycle Conference in Chicago.

Healthcare is a classic example of a model explained in Ian Morrison's book The Second Curve, according to Dr. Oliva. This two-curve model posits that any market undergoing transformation has two curves: the old and the new. Companies must ride the first curve and learn how and when to jump to the second, Mr. Morrison explains in the book.

In healthcare, the first curve was designed around the provider, according to Dr. Oliva. This is because the provider had control over the entire healthcare economy and was able to dictate supply and demand. On the first curve is a carefully controlled entry of physicians into the market, according to Dr. Oliva. On this curve, physicians are able to exert absolute control over demand, too. The attitude was, "Cut my fees by 5 percent and I'll just see 5 percent more people," Dr. Oliva said.

Now this fee-for-service world is being challenged by cost controls, informed consumers and transparency, and it is flipping the power dynamic to a second curve. The trouble is that physicians need to understand how to make the leap to the second curve — value-based care — and remain financially stable.

One of the big changes in the second curve is newly found transparency, according to Dr. Oliva. Patients can go online and not only find information about diseases and medical treatments, but also find information about the quality of care their hospitals or even their individual physicians provide.

"In the past, quality was really determined for the most part by the relationship you had with your physician," Dr. Oliva said. "We never knew whether a physician was good or bad. How would you know that a physician is practicing in a standard of care that's acceptable for his or her specialty? We did a lot of assuming."

Now not only are quality outcomes tied to reimbursement by CMS, but the transparency of information magnifies this change because patients can go online and compare physician performance. These physician transparency tools — Dr. Oliva named ProPublica's Surgeon Scorecard as an example — use Medicare billing information to compare physician performance.

"We see that the connection is vital between what the physician writes in the record to what's billed to insurance companies and Medicare," he said. This means a physician won't be properly reimbursed — or accurately scored on public scoring systems — if he or she is not properly documenting the severity of his or her patients.

This makes clinical documentation improvement essential to landing the jump from the first curve to the second curve in healthcare. Dr. Oliva advised attendees not to take their clinical documentation improvement programs for granted. "If you look at it as a severity capture program first, the revenue will take care of itself," he said.


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