PracticeLink Magazine

FALL 2014

The career development quarterly for physicians of all specialties, PracticeLink Magazine provides readers with feature articles, compensation stats, helpful job search tips—as well as recruitment ads from organizations across the U.S.

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FALL 2014 PracticeLink.com | 51 REIMBURSEMENT BASICS The shift from volume to value VALUE- AND QUALITY-BASED REIMBURSEMENT MODELS emphasize appropriate care for patients over volume. Using metrics such as patient satisfaction and screening or vaccination adherence, payers evaluate physicians and physician organizations or practices. Most current value-based reimbursement models main- tain some degree of fee-for-service or capitation, at least for now. Each has varying metrics for quality performance and varying levels of incentive for meeting performance goals. Nationwide efforts to reward physician organizations for improving quality of patient care while reigning in costs have been occurring in the commercial sector for years, and the Affordable Care Act will institutionalize and ex- pand these efforts. The following are some of the common terms and concepts used in the movement toward quality- and value-based payment. Accountable care organization An ACO is a group of physicians, hospitals and other pro- viders who voluntarily work together to coordinate care for Medicare patients. Capitated contract A risk-sharing arrange- ment that pays physi- cian organizations a set amount per member. Global budget A fxed maximum that can be spent for a specifed group of health care services. The budget usually is set by a government entity. Meaningful use This early step in Medicare's incentive to improve patient care through technology and data tracking and reporting encouraged electronic health record implementation in physician practices and hospitals. Medical home Also called patient-centered medical home, this is team- based care that is coordinated across a health care system to address the patient's care as a "whole person." Each patient's medical home should have a primary clini- cal contact. Pay-for-performance system Often used synonymously with value-based reimburse- ment, P4P systems base reimbursement or bonus pay- ments on quality measures or metrics, not volume. They also often include goals for effciency, resource use or cost savings. n organizations, or ACOs, and to changes under the Patient Protection and Affordable Care Act (ACA). The rapid growth in health care spending and sub-optimal quality of care caught the attention of Zirui Song, M.D., when he was a medical student at Harvard. "I realized that these issues would touch patients in a real way and also impact my classmates and me as providers," Song says. "For the care of an aging population and future generations, I thought it was imperative that my generation of physicians fgure out how to put health care spending back on a sustainable path while improving the quality of care." Song sprung into action, training to become a physician economist. He just graduated with an MD/ PhD and became an internal medicine resident at Massachusetts General Hospital in Boston. Song didn't stop at learning about health care economics, however. He has headed research on Medicare offce visit payments and showing how ACOs can lower medical spending and improve quality of care. His efforts in gathering grants and leading research on health care costs and quality led to his selection as one of Forbes magazine's "30 under 30" in science and health care. "Despite their growth in some areas, global budgets and ACOs are still in infancy nationally," says Song. Under transitional value-based models, California providers receive capitated or global payments along with bonus payments for meeting quality measures. "At this point, we've structured a shared savings program, not a shared risk program," says Erickson. She sees that as a step in the right direction, provid- ing incentives that help physicians learn about and feel comfortable with resource use while having some return on investment. Many of the plans also have risk adjustment. "Risk adjustment says 'we'll pay you more for a patient who has complex comorbidities or chronic diseases because it might take a lot of money to take care of them,'" says Amy Nguyen Howell, M.D., MBA, chief medical offcer for CAPG—The Voice of Accountable Physician Groups in Los Angeles. CAPG represents 180 physician organizations in more than 26 states plus Puerto Rico that practice capitated, coordinated care. Under the ACA, accountable care organizations and shared savings already are affecting Medicare reimbursement, which makes up a mighty proportion Continued on page 53

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