Stop the Noise: How Hospitals Can Provide Physicians With Meaningful Feedback

Most people know the process. A pair of pants fit too snugly, and the diet begins. You replace burgers with salads, escalators with stairs. You clock two extra hours at the gym each week, decline second servings and take only a single bite of your birthday cake. All of this takes an ample amount of mindfulness and change to your hardwired behaviors, but at least you have a goal: You just need to lose seven pounds. You know precisely how far you have to go.

But what if, instead of daily or weekly, you weighed yourself only once? And what if you waited 365 days from the day you set your goal to the day you stepped onto the scale?

Odds are your diet would lose momentum. The lack of real-time data — the reading on the scale — would leave you feeling out of control and, frankly, not so motivated. From day to day, you'd lose sight of your goal and what you could be doing in the short-term to reach it.

Hospital administrators and physicians face a similar scenario as healthcare transitions from a fee-for-service to pay-for-performance payment model. The two groups need to truly join forces, and the integration needs to happen continuously.

While healthcare won't make an immediate jump to outcomes-based payments, the transition has definitely begun. Quint Studer, founder of outcomes-based healthcare consulting firm Studer Group, says about 10 percent of physicians in the United States are already working in value-based arrangements or have income tied to performance measures.

This will be a big transition for the industry at large, but problems will arise more acutely if hospitals do not adjust their feedback systems, says Mr. Studer. Working in a pay-for-performance model means physicians need meaningful, real-time performance data on a regular basis.

Today, some hospitals review physicians' performance only in annual, retrospective meetings. To return to the initial analogy, this can be as effective as weighing yourself once after spending a year trying to shed pounds. Without a proper feedback system, physicians — who are data-driven by nature — will miss opportunities to improve. Organizations can only benefit from teaming up with physicians to develop one.

There are four steps to implementing a physician performance feedback dashboard: developing the metrics, communicating the plan to physicians, sharing their results and following up with physicians. Here are some tips to help hospital leaders carry out the process.

1. Begin the transition sooner than later. Most healthcare organizations are still in a somewhat comfortable place right now, as their backs are not up against the wall when it comes to value-based payments. Only a portion of federal reimbursement is tied to performance-based measures, but this will increase over time.

Under Medicare's Value-Based Purchasing Program, hospitals stand to lose or gain a certain percentage of their base operating DRG reimbursement based on their performance. It was 1 percent for fiscal year 2013, but will grow to 1.25 percent for FY 2014, 1.5 percent for FY 2015, 1.75 percent for FY 2016 and 2 percent for FY 2017 and subsequent years. In FY 2014, maximum penalties for Medicare's readmission reduction program will also increase from 1 percent to 2 percent.

If they haven't already started, hospitals can still work with physicians in a thoughtful, measured manner to create a dashboard of performance metrics.  

"If leaders begin now, as the payment system shifts more and more toward pay-for-performance, their medical staff will slowly get used to the new metrics," says Mr. Studer. "It won't be such a huge jump later when the change becomes more urgent. The sooner physicians move to a feedback system, the better."

Incorporating a dashboard also gives hospitals time to address any resistance or complaints.

"This way, at least [hospitals are] not being severely penalized as executives and physicians adjust to the new system," says Mr. Studer. "Let's not wait until our backs are against the wall."

2. Use individual feedback to drive broader goals. Hospitals may find a gap between their organizational goals and physicians' practice habits, particularly if those physicians are newly employed and still in the process of aligning to the system.

"When doctors come aboard, what they need to improve more than anything else is efficiency," says Mr. Studer. "But a physician may not be reimbursed for behaviors that improve cost efficiency. If we align people to a different model that is value-based, we need a feedback system that helps physicians align to where the organization is going."

Patient perception of care is a particularly influential metric, greatly helping or harming several other aspects of a hospital's bottom line. Physicians who monitor and improve these scores can increase referrals, reinforce patients' word of mouth recommendations for the hospital and deliver improved clinical outcomes through better patient adherence to treatments and medication use. Finally, better patient experiences can also reduce length of stay. By including patient perception of care as one of physicians' performance metrics, hospitals can reinforce several organizational goals at once.

3. Sometimes, less really is more. It doesn't take much for performance measures to grow wildly complex. Some hospitals provide hundreds of performance measures from several different departments, which can leave physicians drowning in a sea of statistics. When presented this way, it's difficult to decipher which metrics, if any, matter most.  

It's up to hospitals to help physicians understand which performance metrics are most critical, says Mr. Studer.  

"If I say, 'Here are 116 measures of your performance — hope you do better next month,' you would feel paralyzed,” he explains. "But if I say, 'Here are the eight metrics that matter most for the next two years,' you'd feel like have some ability to make an impact."

Mr. Studer and Matthew Bates, senior leader with Studer Group, say they've seen hospitals go from not sharing any performance measures to sharing tons of them. Hospitals must find the right balance. The optimal number of performance measures ranges from six to eight, according to Mr. Bates.

"We also find it's important to put weights around them," he says. "So out of six, for example, two measures are more important. Those would be weighted 20 percent, where the others are weighted 10 percent."

Physicians may be data-oriented by nature, but hospitals need to uphold the value of quality over quantity when it comes to performance feedback. By sharing the most important and actionable data in a fashion that does not overwhelm, hospitals can empower physicians to make improvements.

4. Work with physicians to reduce resistance. The transition to pay-for-performance won't occur without some tension. Most physicians are not accustomed to practicing medicine while keeping on eye on various income-tied performance scores and metrics. And when they don't trust the data, they will not embrace a hospital's performance feedback system. Mr. Bates has observed three main reasons physicians have a problem with performance data.

First, physicians might not agree with the value of certain metrics. They might argue that certain measures are flawed or do not capture real value, rendering them futile. Second, they might think the data are inaccurate in its attribution. They may argue that a patient satisfaction score, for instance, does not truly reflect the opinions of their patients. Finally, physicians may reason that their patients are sicker than the "average" pool of patients — either those of other physicians or the national average.

Mr. Studer says this type of pushback makes it critical that hospitals include physicians in the selection of metrics. It's the best way to get their buy-in up front. The pushback also reinforces the need to install a performance feedback system rather than wait until a pay-for-performance environment demands it. Physicians might initially balk at some metrics before after trying them out, but Mr. Studer says most ease into the metrics throughout the performance year.

5. Establish both common and personalized measures. Hospitals can make performance measures uniform across the organization or specific to physicians, and a combination of both is often effective, say Mr. Studer and Mr. Bates. Many organizations have one or two process measures that are common across the hospital or health system, such as improving a specific HCAHPS measure. Other metrics vary depending on the physician specialty. Some of the more common measures for primary care physicians center on the rate at which patients return to the PCP for several visits and network referral rates, or on how often physicians refer patients to physicians in the system, according to Mr. Studer.

Aside from being specialty-specific, performance measures can also be attuned to address physicians' individual habits or behavior to help them better align with the standards of the hospital.

"Some of these measures can have big dollars tied to them," says Mr. Studer. "For a surgeon, a big weight might be starting on time in the operating room. It could also be the amount of surgical supplies a surgeon uses per case."

6. Move away from the "rear-view mirror approach." Traditionally, department managers may have waited until year's end to retrospectively review physicians' performance reports and RVUs. This worked in a fee-for-service world, but the annual timeframe won't hold in a pay-for-performance environment.

"We're seeing many organizations shift from the rear-view mirror approach," says Mr. Bates. "Instead of waiting until the end of the year and saying, 'Let's look at your performance,' hospitals are becoming more upfront."

Some hospitals are now making physicians' performance reviews a quarterly process. Then, once they grow comfortable with that, managers may increase the number of reviews until they're held on a monthly basis. In fact, Mr. Bates says he's seen some hospitals do it even more frequently than that.

If physicians' pay is tied to certain behaviors and improvements, frequent and regular reviews are only fair and empower physicians with meaningful data. It's not too late for them to use monthly data to adjust their behaviors, whereas in an annual, retrospective review meeting the data might be too little, too late.

"Physicians want to know, 'How am I doing now?'" says Mr. Bates. "What can I do differently today?'"

Although the transition from fee-for-service to pay-for-performance will involve some initial discomfort, it will be easier for hospital leaders and physicians alike when meaningful data is provided in a measured and consistent way. This will also speak volumes about a hospital as a place of employment.

"By understanding physicians' respect for evidence-based information, hospitals can help them become more responsive to opportunities for improvement," says Mr. Studer.  

Once physicians adjust to more frequent performance reviews and become mindful of their six to eight measures, they may see the dashboard as a return to fundamentals.

"Most doctors look at their evaluation system and see how, in the past, they have been paid on productivity and collections," says Mr. Studer. "They haven't been paid on clinical quality or reducing falls. They haven't been paid for improving clinical outcomes or the patient experience. So I think the change we're discussing is more geared toward their values, toward what they want to do. I think this resonates with physicians. It's a breath of fresh air."

A robust physician feedback system can also give physicians a sense of empowerment and control, particularly those who are newly employed and need to adjust their practice to meet systemwide goals. Multi-year performance measures and regular, proactive review sessions can provide a sense of stability in a time of high hospital CEO turnover and rapid hospital consolidation.

"This allows physicians to feel more secure and in control of their own destiny," says Mr. Studer. “Even if there is a shift in control, physicians know they are in control of their performance and are armed with the data they need to make improvements.”

More Articles on Physician Feedback:

10 Signs of Troubled Physician Alignment
Physician Engagement: 20 Survey Findings
Bridging the Gap Between Fee-for-Service and Value-Based Care Starts With Physician Feedback

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