What lies ahead for the Patient Protection and Affordable Care Act (PPACA)? Many wonder if it can or will be implemented and whether there is any infrastructure to implement it. Another consideration is Accountable Care Organizations (ACOs).
What do they mean to emergency medicine? Some say ACOs may be a new name for capitation; if so, that movement arguably has no impact on emergency medicine except for the failure of the primary care network to keep patients out of the emergency department (ED). Some experts suggest that the proposed ACO model as currently constructed will result in financial loss even for some of the financially strongest physician practices. The new buzz words of today’s healthcare environment are “fee-for-value, economic ceilings and “evidence-based clinical care.” CMS’ Acute Care Episode project portends a bundled payment system where doctors will negotiate with hospital administration for payments. And the AMA’s National Health Insurer Report Card still shows a 19.3 percent claims processing error rate among most major insurers.
At this time there are no clear answers to the list of potentially imposing questions and danger areas. Although it remains to be seen where and how emergency medicine will fit into emerging healthcare model(s), there is one certainty: It is critical that the specialty take a leadership role by being “at the table” with both hospital administrations and insurers.
There are many issues challenging the specialty as it moves forward into a new era of healthcare. However, the priority must be in strong practice management, whether emergency physicians are hospital-employed, private practices or some variation on the theme. This is the time for emergency medicine leaders to shape the evolving healthcare landscape and garner a strong industry position.
Provider Credentialing–Paperwork Still Matters.
That was the 30,000 foot view. Now let’s get down in the weeds for some everyday issues. You know all those forms that the billing office makes you fill out when you start to work at a new place or when a new insurance form is required? Emergency physicians are about treating patients, not filling out insurance forms. Right? Here’s an example of how the timely filing of paperwork to insurers can strengthen a practice’s financial position or cripple it when it is mishandled. Suppose the billing office for a practice in Manhattan chases a physician for two months to fill out paperwork. Current Medicare reimbursement is $127.56 (99284), $186.60 (99285) and $242.17 (99291). If the physician works 20 shifts a month, the practice’s financials will be immediately impacted, as shown in the following example:
1. Physician works 20 shifts in the first month
2. Physician sees 60 Medicare patients in the first month, with the following acuities:
a. 99284 -(20 X $127.56) - Loss of $2,551.20
b. 99285 -(20 X $186.60) - Loss of $3,232.00
c. 99291 -(20 X $242.17) – Loss of 4,843.40
d. Lost Medicare revenue to Practice- $10,626.60
3. Same physician sees 65 Medicare patients in the second month, with the following acuities:
a. 99284 - (15 X $127.56) - Loss of $1,913.40
b. 99285 - (28 X $186.60) - Loss of $5,224.80
c. 99291 – (22 X $242.17) –Loss of $5,327.74
d. Lost Medicare revenue to Practice- 12,465.94
e. Total lost Medicare $ to Practice in two months- $23,092.54
And this is just for Medicare. But Medicare is not the only payer requiring credentialing. If the practice participates with Blue Shield and three managed care plans the financial impact snowballs dramatically. Payments will not necessarily be lost although some may be, but they will be delayed significantly. Assuming reimbursement schedules in those plans at some multiple above the Medicare fee schedule, the practice faces thousands of additional dollars in delayed payments for this physician, assuming comparable patient acuities. The payer collects interest while the physician treats patients effectively for nothing for months!
There is no practice that can afford this disastrous financial impact, all due to a lack of scrutiny by the practice’s leadership, along with the lack of physician cooperation about paperwork. “Paper before Patients” makes good financial sense.
Electronic Charts: Don’t Take Chances Here.
Every hospital in the country either has an EMR or is very likely moving toward implementing one. There are several issues related to the implementation of an EMR that will impact the financial strength of the emergency department group.
Unfortunately in some hospitals the selection of the new EMR platform is done without input from anyone from the emergency department even the ED Director. To further complicate this situation, the ED Director is then tasked with making the enterprise system work in the ED, whether it was intended to do so or not. This can be a very time consuming task for any practice, particularly when it must be “molded” into an ED-specific chart, along with all applicable protocols.
Aside from making the EMR “fit” the ED, these enterprise systems often include macros, prompts, templates, pre-formatted documentation and mechanisms for cloning sections of the chart that are not relevant to the practice of emergency medicine.
The implementation of a new system, especially one that is not intended for EM can create a sort of “perfect storm” that brings the ED to a halt functionally and financially. Information that is repeated from one form to the next, defaults to a more extensive history and/or requirements for a physician examination that is more extensive than is medically necessary without highlighting new information and changes in the patient’s condition can lead to a buildup of records all looking the same.
This in turn will begin to raise issues of medical necessity with payers, delay payments and increasing the chances of an audit. Therefore, it is imperative that a compliance expert should always be a key adviser in the selection and designed use of today’s EMRs.
The message is clear: an EMR that is a poor fit for the ED is about more than just patient flow, they can cost money. In the din of a busy ED, when everything gets crazy and time is at a premium – it is imperative to remember every patient encounter is unique, and the care delivered to each patient is unique. It is important that physicians resist the temptation to hurriedly cut-and-paste, slice and dice portions of records. The result is that far too many charts begin looking the same. This could result in being paid today only to give it all back tomorrow. Audits create a severe revenue hits for the practice and a potentially horrific blow to someone’s career.
Practice and Payor Contracting: Do You Know Who your Patients Are?
It is an annual event for the Medicare Fee Schedule to be debated with the threat of catastrophic reductions looming for virtually every practice. In addition to being politically active there are definite steps every ED practice can take to protect its finances. And the window of opportunity is now. It may never come again in its present form.
As a first step it is important to insure the practice fee schedule is up-to-date and inclusive of all billable services. All billable services are not limited to, but should include observation, bedside ultrasound, sedation, fracture care, X-Ray interpretations, and EKG interpretations. Not every practice will bill for each of these services but they should be included in every payor negotiation. Then if the political situation changes internally within the hospital or, if the enforcement of existent Medicare regulations shifts more in favor of emergency medicine the group will be ready. Perhaps the most important factor in maintaining a current fee schedule is that non-contracted, commercial payers paying a high percentage of charges is still the status quo. But this will likely not continue for very long.
Current contracts should be scrutinized for renegotiation opportunities. In this context it is imperative to stay away from negotiating any rates in terms of Medicare rates. This is not to say rates can’t be evaluated during the contracting phase against Medicare rates but never allow rates to be tied to phrases such as X% of the “current” Medicare fee schedule. It can be potentially disastrous to a practice to have rates tied to the current schedule, particularly when Medicare rates are constantly in jeopardy.
Directly related to addressing current contracts, it is also smart to carefully assess the practice’s payor mix. As reported in two recent Gallup polls the incidence of adults ages 18-25 has increased by 1 million, but the percentage of uninsured among the 26-64 age group has increased from 18.1 percent to 19.9 percent. What this means is the ED practice’s payor mix may be shifting and this can impact its finances. Within PPACA it is expected that the prevalence of the uninsured will decrease. The result should be that more of the practice’s self-pay mix will become insured. One might expect that this will have a positive impact even if the associated Medicaid rates are not near those of Medicare, and definitely far from existing managed care rates. Individuals age 65+ warrant monitoring also as they work longer and continue to shift among their coverage plans. Each of these factors contributes to the financial health of the practice, and therefore deserves close attention.
Pulling it Together and Leading
With knowledge of these practice parameters EPs are better prepared for the future as they assume leadership positions within their respective hospitals. No one can predict how the “hospital-employed” versus “private-practice” pendulum will swing next for physician practices. It does seem safe to state emergency physicians will necessarily need to, at a minimum, strengthen their relationships with their respective hospital administrations. As the emphasis increases on the patient care experience, EPs should be well positioned to speak the language of their various administrators. The Disney Institute’s new healthcare service program being offered to hospitals includes a core component of leadership to cover the “overall patient experience.” This framework for patient care is not new to us and fits directly into the emergency physician’s skill set and expertise.
The future will likely include physicians negotiating/bargaining with more than their administrators. Insurance companies are beginning to purchase both physician practices and also entire hospitals. Emergency medicine will always stands guard at the sharp end of medical care, trained and prepared to stabilize the critically ill with access to the entire spectrum of diagnostic testing and specialty consultation. But as more emphasis is placed on cost containment, EM’s primary directive may be forced to change to some degree. The knowledge of how to judiciously utilize resources may become one of our most valuable assets. To date, emergency medicine has focused its efforts on the timely delivery of critical care to one patient at a time. But increasingly its true value will include population management: matching patient requirement with appropriate resources in the appropriate time frame. The ‘right tool for the right job at the right time’ concept applies not only to an ideal staffing model but also to the delivery of population medical care.
The foundation of accountable care is the idyllic medical home. A designated medical home for all patients philosophically seems attainable, yet this utopian situation is a long way from prime time. Even so, the elimination of episodic care needs is unimaginable. As evidenced by current universal care models, the need for diagnostic and procedural skills will likely increase, possibly in dramatic fashion. Standing guard to fill the gaps will be emergency departments, newly transformed into whatever is required. While continuing to practice the core mission of excellence in emergent care, additional services will demonstrate the ED’s abilities and importance. We will continue in the primary management of uninsured and underinsured. But we will also be charged with limiting readmissions and directing low acuity patients to less acute settings. The ED is the perfect vehicle to manage, with endless flexibility, the needs of a healthcare system with rapidly cycling priorities.
The cost component of the value equation will, however, occupy an increasingly important role. Implementation of cost control measures is long overdue but is now on center stage. Some will perceive the result as a mandate to take risk on patient outcomes, since by doing less we will have less information on which to base decisions. If done correctly, with cooperation between the medical and legal establishments, the focus on value could provide consistency and standardization as EDs focus on interventions that produce optimal outcomes instead of simply providing a greater quantity of care. The resulting delivery of evidence-based care could be medico-legally protective if global evaluation standards, based on best evidence, are utilized. Could be. However, these initiatives will require a significant paradigm shift of thought and a degree of previously un-witnessed cooperation between the medical and legal establishments. Until then, as risk continues to be placed on the clinician, defensive medicine and overutilization will remain.
Admittedly, the independence gene possessed by emergency physicians may balk at efforts directed toward standardization and reduction in practice variation. Physician leadership will be a vital to implement and obtain buy-in during this transformation. One potential role of emergency physician leaders will be to serve as ‘pin cushions’ to absorb the pain created by change. Dizzying number of core measures, the bedside inefficiency of the current first generation electronic health records, and the limitation of disposition options available as ED physicians will be painful to EPs as they are forced to transition from a focus on care of individual patients to care of populations. If systems are not developed to aid clinicians in navigating these intrusions on their daily decision-making, efficiencies will not be realized and possibly more damaging, the enjoyment of practicing medicine will be gone.
The Massachusetts universal model of care has suggested that our predictions for patient volume should be generous. In addition to volume, patient payor mixes are likely to change. Emergency medicine’s success will hinge on its ability to implement standardization measures, control cost, and direct patients to the appropriate provider in the appropriate setting. An unprecedented level of coordination with primary care providers, skilled nursing facilities, and admitting clinicians will be required.
Regarding value, the least discussed part of the healthcare bill is the lack of a prescription to achieve this low cost/high quality competency. Either through sheer genius or gross oversight, this task has been left to the innovative energies of providers and healthcare systems on the front line. The Geisinger Health System in Pennsylvania received attention for an idea called ‘ProvenCare.’ The concept is that patients pay a flat fee for an episode of care, such as bypass surgery or hip replacement and essentially get a 90-day warranty. Complications? The hospital has to eat the cost. Geisinger has gambled that being relentless on implementing best practices and driving out unjustified variation would help patients recover faster and cost less to the entire system – and so far, it seems to be working.
Value in emergency medicine has proven harder to define. Some traditional measures, like mortality, have proven difficult to effectively compare across health systems. Other measures, like 72-hour returns, have proven to be of little relevance. Perhaps focusing on practice variation holds the key. The ‘standardized but customizable’ approach to patient care acknowledges that there are certain fundamental ‘standardized’ diagnostic tests required to evaluate a patient with a particular presentation, but that individual variation in presentation warrants the ‘customizable’ component of the workup. With this and other innovative models in hand, emergency medicine may be able to gain control of the cost portion of the value equation, and shed the persona of being ‘inefficient and expensive.’
It is evident that the environment is in tremendous flux and the variables are many. Now is the time for emergency physicians to take their rightful positions as leaders on the emerging healthcare landscape. Emergency physicians bring unique experiences, skills and qualifications to the table. Hospital administrations and the payer community are the audience, and the opportunity may be short-lived, therefore it is time to seize it now!