How identifying high-value PCPs can improve profitability

Providers and health plans are constantly searching for ways to improve their bottom line without slashing benefits or increasing premiums.

One opportunity lies in networking with high-value primary care physicians, says Karen Way, health plan analytics and consulting practice lead at NTT DATA Services based in Plano, Texas.

In a February blog post, Ms. Way referenced a study by The Peterson Center on Healthcare and the Clinical Excellence Research Center at Stanford (Calif.) Medicine that analyzed how steering patients toward high-value PCPs can aid providers and health plans in cost control. The study found high-quality PCPs that implement a team approach to care helped prevent hospitalizations and other complications affecting chronically ill patients.

"If you can identify and increase the number of high-value primary care teams in your network, you can control costs without compromising benefits," Ms. Way writes.

Ms. Way spoke with Becker's Hospital Review about four specific steps providers and health plans can take to find and use high-quality PCPs.

1. Attribute members to providers. When assessing quality and value of PCPs, providers "have to look at it through slightly different lens," Ms. Way says. Although there are several methodologies to help healthcare organizations attribute members to a high-value PCP, Ms. Way recommends using CMS' Quality and Resource Use Reports. The 2015 QRURs details how group practices and practitioners in the U.S. performed in 2015 on certain quality and cost measures, identifying practices and practitioners by their Medicare-enrolled taxpayer identification number. While hospitals and health plans should sort specialists from PCPs when using QRURs, Ms. Way also advises providers hold on to the list of specialists to look for high-value opportunities in that area.  

2. Quantify performance rates for clinical outcome measures. Ms. Way says hospitals and health plans can use Healthcare Effectiveness Data and Information Set or Medicare Advantage Star ratings to calculate performance rates for PCP outcomes. Ms. Way writes in her blog post while "these measure sets are reported at the health plan level to the National Committee for Quality Assurance and CMS, the logic to produce these results can be implemented at the provider level."

3. Estimate the yearly cost per patient for each provider. Ms. Way says since cost can be defined in several ways, it's helpful to use existing methodologies like QRURs or relative value units to calculate annual cost per patient for each provider. Relative value units are measures Medicare uses to determine reimbursement under its physician fee schedule. Once the methodology is chosen, Ms. Way says hospitals and health plans have to look at risk adjustments for the population and each patient.

"You want to compare apples to apples when you look at the cost data, because a physician who treats older diabetic patients with co-morbidities is going to have a much higher annual cost per person than a physician who has a population of younger, healthier patients," she wrote in her blog post.

4. Rank PCPs by quality and cost per patient. Ms. Way says this final step involves taking all the information from steps one through three and collating it. The high-value PCPs will be the ones with the highest quality scores and the lowest cost. Ms. Ways says there may not be a large number of high-value PCPs, but "all of the data give providers a bell curve of who is doing well and who is not doing well. Providers can then say, 'Let's go talk to PCPs that are doing really well and engage them in a value-based contract.'"

Ms. Way advises providers and health plans seeking high-value PCP arrangements to "look at the capabilities you have in-house. If you don't have any [capabilities] in-house, look for a vendor, tool or a combination of the two" that can help analyze the data. "It's going to impact your bottom line," she says. 

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