Coding

On April 1, President Obama signed into law a bill that again delays a permanent fix of the sustainable growth rate formula, or SGR, the so-called “doc fix.” The bill also contained a surprise provision added by Congress to delay implementation of the switch from ICD-9 to ICD-10. The mandated conversion was supposed to take place by October 1 of this year; its delay will have a range of impacts on everyone from physicians to payers.

Hospitalists and others must weigh their options going forward, as many health systems and groups are already well on their way toward compliance with the 2014 deadline.

At this point, prevailing wisdom is that Congress added the delay as an appeasement to physician groups that would be unhappy about its failure to pass an SGR replacement, says Jeffrey Smith, senior director of federal affairs for CHIME, the College of Healthcare Information Management Executives.

“The appeasement, if in fact that was the motivation, was too little too late,” Smith says, adding Congress “caused a lot of unnecessary chaos.”

For instance, according to Modern Healthcare, executives at Catholic Health Initiatives had already invested millions of dollars updating software programs to handle the coding switch ahead of a new electronic health record system roll-out in 89 of its hospitals, which would not have been ready by the ICD-10 deadline.

“Anyone in the process has to circle the wagons again and reconsider their timelines,” Smith says. “The legislation has punished people trying to do the right thing.”

The transition to ICD-10 is a massive update to the 30-year-old ICD-9 codes, which no longer adequately reflect medical diagnoses, procedures, technology, and knowledge. There are five times more diagnosis codes and 21 times more procedural codes in ICD-10. It’s been on the table for at least a decade, and this was not the first delay.

In 2012, when fewer groups were on their way to compliance, CMS estimated that a one-year push-back of ICD-10 conversion could cost up to $306 million. With the latest delay, the American Health Information Management Association says CMS now estimates those costs between $1 billion and $6.6 billion.

However, according to the American Medical Association, which has actively lobbied to stop ICD-10 altogether, the costs of implementing ICD-10 range from $57,000 for small physician practices to as high as $8 million for large practices.

The increased number of codes, the increased number of characters per code, and the increased specificity require significant planning, training, software updates, and financial investments.

The Medical Group Management Association (MGMA) also pushed for ICD-10 delay, concerned that many groups would not be ready by Oct. 1. MGMA surveys showed as much, says Robert Tennant, senior policy advisor for MGMA.“We were concerned that if everyone has to flip the switch at the same time, there will be huge problems, as there were for healthcare.gov,” Tennant explains.

What MGMA would like to see is more thorough end-to-end testing and staggered roll-outs. Hospitals and health plans should be permitted to start using ICD-10 coding when they're ready, even if ahead of the next deadline, Tennant said. MGMA would also like to see a period of dual coding built in.

The ball is now in CMS' court.

“I think that CMS has within its power … the ability to embolden the industry to be more confident,” Smith says. “Even if it’s not going to require ICD-10 codes [by October 2014], hopefully they are still doing testing, still doing benchmarking, and by the time the deadline rolls around, it will touch every sector of the healthcare economy.”

Hospitalists, Smith says, should be more involved in the conversation going forward, to help maintain the momentum and preserve the investments made by their groups and institutions. Those not ready should push for compliance, rather than finding themselves in the same position a year from now.

Many of the hospital CIOs (chief information officers) he has talked to say that while they are stopping the car, they are keeping the engine running. Some will push for dual coding, even if only internally, because it’s proving to be a valuable tool in understanding their patient populations.

“It’s a frustrating time any time you have to kind of stop something with so much momentum, with hundreds of millions, if not billions, spent in advance of the conversion,” Smith says. “It does nothing to help care in this country to stay on ICD-9. Everybody understands those codes are completely exhausted, and the data we are getting out of it, while workable, is certainly not going to get us where we need to be in terms of transforming healthcare.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

On April 1, President Obama signed into law a bill that again delays a permanent fix of the sustainable growth rate formula, or SGR, the so-called “doc fix.” The bill also contained a surprise provision added by Congress to delay implementation of the switch from ICD-9 to ICD-10. The mandated conversion was supposed to take place by October 1 of this year; its delay will have a range of impacts on everyone from physicians to payers.

Hospitalists and others must weigh their options going forward, as many health systems and groups are already well on their way toward compliance with the 2014 deadline.

At this point, prevailing wisdom is that Congress added the delay as an appeasement to physician groups that would be unhappy about its failure to pass an SGR replacement, says Jeffrey Smith, senior director of federal affairs for CHIME, the College of Healthcare Information Management Executives.

“The appeasement, if in fact that was the motivation, was too little too late,” Smith says, adding Congress “caused a lot of unnecessary chaos.”

For instance, according to Modern Healthcare, executives at Catholic Health Initiatives had already invested millions of dollars updating software programs to handle the coding switch ahead of a new electronic health record system roll-out in 89 of its hospitals, which would not have been ready by the ICD-10 deadline.

“Anyone in the process has to circle the wagons again and reconsider their timelines,” Smith says. “The legislation has punished people trying to do the right thing.”

The transition to ICD-10 is a massive update to the 30-year-old ICD-9 codes, which no longer adequately reflect medical diagnoses, procedures, technology, and knowledge. There are five times more diagnosis codes and 21 times more procedural codes in ICD-10. It’s been on the table for at least a decade, and this was not the first delay.

In 2012, when fewer groups were on their way to compliance, CMS estimated that a one-year push-back of ICD-10 conversion could cost up to $306 million. With the latest delay, the American Health Information Management Association says CMS now estimates those costs between $1 billion and $6.6 billion.

However, according to the American Medical Association, which has actively lobbied to stop ICD-10 altogether, the costs of implementing ICD-10 range from $57,000 for small physician practices to as high as $8 million for large practices.

The increased number of codes, the increased number of characters per code, and the increased specificity require significant planning, training, software updates, and financial investments.

The Medical Group Management Association (MGMA) also pushed for ICD-10 delay, concerned that many groups would not be ready by Oct. 1. MGMA surveys showed as much, says Robert Tennant, senior policy advisor for MGMA.“We were concerned that if everyone has to flip the switch at the same time, there will be huge problems, as there were for healthcare.gov,” Tennant explains.

What MGMA would like to see is more thorough end-to-end testing and staggered roll-outs. Hospitals and health plans should be permitted to start using ICD-10 coding when they're ready, even if ahead of the next deadline, Tennant said. MGMA would also like to see a period of dual coding built in.

The ball is now in CMS' court.

“I think that CMS has within its power … the ability to embolden the industry to be more confident,” Smith says. “Even if it’s not going to require ICD-10 codes [by October 2014], hopefully they are still doing testing, still doing benchmarking, and by the time the deadline rolls around, it will touch every sector of the healthcare economy.”

Hospitalists, Smith says, should be more involved in the conversation going forward, to help maintain the momentum and preserve the investments made by their groups and institutions. Those not ready should push for compliance, rather than finding themselves in the same position a year from now.

Many of the hospital CIOs (chief information officers) he has talked to say that while they are stopping the car, they are keeping the engine running. Some will push for dual coding, even if only internally, because it’s proving to be a valuable tool in understanding their patient populations.

“It’s a frustrating time any time you have to kind of stop something with so much momentum, with hundreds of millions, if not billions, spent in advance of the conversion,” Smith says. “It does nothing to help care in this country to stay on ICD-9. Everybody understands those codes are completely exhausted, and the data we are getting out of it, while workable, is certainly not going to get us where we need to be in terms of transforming healthcare.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

On April 1, President Obama signed into law a bill that again delays a permanent fix of the sustainable growth rate formula, or SGR, the so-called “doc fix.” The bill also contained a surprise provision added by Congress to delay implementation of the switch from ICD-9 to ICD-10. The mandated conversion was supposed to take place by October 1 of this year; its delay will have a range of impacts on everyone from physicians to payers.

Hospitalists and others must weigh their options going forward, as many health systems and groups are already well on their way toward compliance with the 2014 deadline.

At this point, prevailing wisdom is that Congress added the delay as an appeasement to physician groups that would be unhappy about its failure to pass an SGR replacement, says Jeffrey Smith, senior director of federal affairs for CHIME, the College of Healthcare Information Management Executives.

“The appeasement, if in fact that was the motivation, was too little too late,” Smith says, adding Congress “caused a lot of unnecessary chaos.”

For instance, according to Modern Healthcare, executives at Catholic Health Initiatives had already invested millions of dollars updating software programs to handle the coding switch ahead of a new electronic health record system roll-out in 89 of its hospitals, which would not have been ready by the ICD-10 deadline.

“Anyone in the process has to circle the wagons again and reconsider their timelines,” Smith says. “The legislation has punished people trying to do the right thing.”

The transition to ICD-10 is a massive update to the 30-year-old ICD-9 codes, which no longer adequately reflect medical diagnoses, procedures, technology, and knowledge. There are five times more diagnosis codes and 21 times more procedural codes in ICD-10. It’s been on the table for at least a decade, and this was not the first delay.

In 2012, when fewer groups were on their way to compliance, CMS estimated that a one-year push-back of ICD-10 conversion could cost up to $306 million. With the latest delay, the American Health Information Management Association says CMS now estimates those costs between $1 billion and $6.6 billion.

However, according to the American Medical Association, which has actively lobbied to stop ICD-10 altogether, the costs of implementing ICD-10 range from $57,000 for small physician practices to as high as $8 million for large practices.

The increased number of codes, the increased number of characters per code, and the increased specificity require significant planning, training, software updates, and financial investments.

The Medical Group Management Association (MGMA) also pushed for ICD-10 delay, concerned that many groups would not be ready by Oct. 1. MGMA surveys showed as much, says Robert Tennant, senior policy advisor for MGMA.“We were concerned that if everyone has to flip the switch at the same time, there will be huge problems, as there were for healthcare.gov,” Tennant explains.

What MGMA would like to see is more thorough end-to-end testing and staggered roll-outs. Hospitals and health plans should be permitted to start using ICD-10 coding when they're ready, even if ahead of the next deadline, Tennant said. MGMA would also like to see a period of dual coding built in.

The ball is now in CMS' court.

“I think that CMS has within its power … the ability to embolden the industry to be more confident,” Smith says. “Even if it’s not going to require ICD-10 codes [by October 2014], hopefully they are still doing testing, still doing benchmarking, and by the time the deadline rolls around, it will touch every sector of the healthcare economy.”

Hospitalists, Smith says, should be more involved in the conversation going forward, to help maintain the momentum and preserve the investments made by their groups and institutions. Those not ready should push for compliance, rather than finding themselves in the same position a year from now.

Many of the hospital CIOs (chief information officers) he has talked to say that while they are stopping the car, they are keeping the engine running. Some will push for dual coding, even if only internally, because it’s proving to be a valuable tool in understanding their patient populations.

“It’s a frustrating time any time you have to kind of stop something with so much momentum, with hundreds of millions, if not billions, spent in advance of the conversion,” Smith says. “It does nothing to help care in this country to stay on ICD-9. Everybody understands those codes are completely exhausted, and the data we are getting out of it, while workable, is certainly not going to get us where we need to be in terms of transforming healthcare.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

Looking for ways to make your HM group run better? SHM is introducing new tools and information to keep you ahead of the curve.

CODE-H Interactive is an industry first: an interactive tool to help hospitalist groups code effectively and efficiently. CODE-H Interactive allows users to validate documentation against coding criteria and provides a guided tour through clinical documentation, allowing users to ensure they are choosing the correct billing code while providing a conceptual framework that enables the user to easily “connect the dots” between clinical documentation and the applicable CPT coding.

CODE-H Interactive includes two modules: one that reviews three admission notes and a second that reviews three daily notes. It also enables users to assess other E/M codes, such as consultations and ED visits. To get started, visit www.hospitalmedicine.org/CODEHI.

Looking for ways to make your HM group run better? SHM is introducing new tools and information to keep you ahead of the curve.

CODE-H Interactive is an industry first: an interactive tool to help hospitalist groups code effectively and efficiently. CODE-H Interactive allows users to validate documentation against coding criteria and provides a guided tour through clinical documentation, allowing users to ensure they are choosing the correct billing code while providing a conceptual framework that enables the user to easily “connect the dots” between clinical documentation and the applicable CPT coding.

CODE-H Interactive includes two modules: one that reviews three admission notes and a second that reviews three daily notes. It also enables users to assess other E/M codes, such as consultations and ED visits. To get started, visit www.hospitalmedicine.org/CODEHI.

Looking for ways to make your HM group run better? SHM is introducing new tools and information to keep you ahead of the curve.

CODE-H Interactive is an industry first: an interactive tool to help hospitalist groups code effectively and efficiently. CODE-H Interactive allows users to validate documentation against coding criteria and provides a guided tour through clinical documentation, allowing users to ensure they are choosing the correct billing code while providing a conceptual framework that enables the user to easily “connect the dots” between clinical documentation and the applicable CPT coding.

CODE-H Interactive includes two modules: one that reviews three admission notes and a second that reviews three daily notes. It also enables users to assess other E/M codes, such as consultations and ED visits. To get started, visit www.hospitalmedicine.org/CODEHI.

Dr. Lenchus

Congress has once again delayed implementation of draconian Medicare cuts tied to the sustainable growth rate (SGR) formula. It was the 17th temporary patch applied to the ailing physician reimbursement program, so the decision caused little surprise.

But with the same legislation—the Protecting Access to Medicare Act of 2014—being used to delay the long-awaited debut of ICD-10, many hospitalists and physicians couldn’t help but wonder whether billing and coding would now be as much of a political football as the SGR fix.¹

The upshot: It doesn’t seem that way.

“I think it’s two separate issues,” says Phyllis “PJ” Floyd, RN, BSN, MBA, NE-BC, CCA, director of health information services and clinical documentation improvement at Medical University of South Carolina (MUSC) in Charleston, S.C. “The fact that it was all in one bill, I don’t know that it was well thought out as much as it was, ‘Let’s put the ICD-10 in here at the same time.’

“It was just a few sentences, and then it wasn’t even brought up in the discussion on the floor.”

Four policy wonks interviewed by The Hospitalist concurred that while tying the ICD-10 delay to the SGR issue was an unexpected and frustrating development, the coding system likely will be implemented in the relative short term. Meanwhile, a long-term resolution of the SGR dilemma remains much more elusive.

“For about 12 hours, I felt relief about the ICD-10 [being delayed], and then I just realized, it’s still coming, presumably,” says John Nelson, MD, MHM, a co-founder and past president of SHM and medical director of the hospitalist practice at Overlake Hospital Medical Center in Bellevue, Wash. “[It’s] like a patient who needs surgery and finds out it’s canceled for the day and he’ll have it tomorrow. Well, that’s good for right now, but [he] still has to face this eventually.”

“Doc-Pay” Fix Near?

Congress’ recent decision to delay both an SGR fix and the ICD-10 are troubling to some hospitalists and others for different reasons.

The SGR extension through this year’s end means that physicians do not face a 24% cut to physician payments under Medicare. SHM has long lobbied against temporary patches to the SGR, repeatedly backing legislation that would once and for all scrap the formula and replace it with something sustainable.

The SGR formula was first crafted in 1997, but the now often-delayed cuts were a byproduct of the federal sequester that was included in the Budget Control Act of 2011. At the time, the massive reduction to Medicare payments was tied to political brinksmanship over the country’s debt ceiling. The cuts were implemented as a doomsday scenario that was never likely to actually happen, but despite negotiations over the past three years, no long-term compromise can be found. Paying for the reform remains the main stumbling block.

“I think, this year, Congress was as close as it’s been in a long time to enacting a serious fix, aided by the agreement of major professional societies like the American College of Physicians and American College of Surgeons,” says David Howard, PhD, an associate professor in the department of health policy and management at the Rollins School of Public Health at Emory University in Atlanta. “They were all on board with this solution. ... Who knows, maybe if the economic situation continues to improve [and] tax revenues continue to go up...that will create a more favorable environment for compromise.”

Dr. Howard adds that while Congress might be close to a solution in theory, agreement on how to offset the roughly $100 billion in costs “is just very difficult.” That is why the healthcare professor is pessimistic that a long-term fix is truly at hand.

“The places where Congress might have looked for savings to offset the cost of the doc fix, such as hospital reimbursement rates or payment rates to Medicare Advantage plans—those are exactly the areas that the Affordable Care Act is targeting to pay for insurance expansion,” Dr. Howard adds. “So those areas of savings are not going to be available to offset the cost of the doc fix.”

ICD-10 Delays “Unfair”

Dr. Lenchus

The medical coding conundrum presents a different set of issues. The delay in transitioning healthcare providers from the ICD-9 medical coding classification system to the more complicated ICD-10 means the upgraded system is now against an Oct. 1, 2015, deadline. This comes after the Centers for Medicare & Medicaid Services (CMS) already pushed back the original implementation date for ICD-10 by one year.

SHM Public Policy Committee member Joshua Lenchus, DO, RPh, FACP, SFHM, says he thinks most doctors are content with the delay, particularly in light of some estimates that show that only about 20% of physicians “have actually initiated the ICD-10 transition.” But he also notes that it’s unfair to the health systems that have prepared for ICD-10.

“ICD-9 has a little more than 14,000 diagnostic codes and nearly 4,000 procedural codes. That is to be contrasted to ICD-10, which has more than 68,000 diagnostic codes ... and over 72,000 procedural codes,” Dr. Lenchus says. “So, it is not surprising that many take solace in the delay.”

Dr. Nelson says the level of frustration for hospitalists is growing; however, the level of disruption for hospitals and health systems is reaching a boiling point.

“Of course, in some places, hospitalists may be the physician lead on ICD-10 efforts, so [they are] very much wrapped up in the problem of ‘What do we do now?’”

The answer, at least to the Coalition for ICD-10, a group of medical/technology trade groups, is to fight to ensure that the delays go no further. In an April letter to CMS Administrator Marilyn Tavenner, the coalition made that case, noting that in 2012, “CMS estimated the cost to the healthcare industry of a one-year delay to be as much as $6.6 billion, or approximately 30% of the $22 billion that CMS estimated had been invested or budgeted for ICD-10 implementation.”²

The letter went on to explain that the disruption and cost will grow each time the ICD-10 deadline is pushed.

“Furthermore, as CMS stated in 2012, implementation costs will continue to increase considerably with every year of a delay,” according to the letter. “The lost opportunity costs of failing to move to a more effective code set also continue to climb every year.”

Stay Engaged, Switch Gears

One of Floyd’s biggest concerns is that the ICD-10 implementation delays will affect physician engagement. The hospitalist groups at MUSC began training for ICD-10 in January 2013; however, the preparation and training were geared toward a 2014 implementation.

“You have to switch gears a little bit,” she says. “What we plan to do now is begin to do heavy auditing, and then from those audits we can give real-time feedback on what we’re doing well and what we’re not doing well. So I think that will be a method for engagement.”

She urges hospitalists, practice leaders, and informatics professionals to discuss ICD-10 not as a theoretical application, but as one tied to reimbursement that will have major impact in the years ahead. To that end, the American Health Information Management Association highlights the fact that the new coding system will result in higher-quality data that can improve performance measures, provide “increased sensitivity” to reimbursement methodologies, and help with stronger public health surveillance.³

“A lot of physicians see this as a hospital issue, and I think that’s why they shy away,” Floyd says. “Now there are some physicians who are interested in how well the hospital does, but the other piece is that it does affect things like [reduced] risk of mortality [and] comparison of data worldwide—those are things that we just have to continue to reiterate … and give them real examples.”

Richard Quinn is a freelance writer in New Jersey.

References

1. Govtrack. H.R. 4302: Protecting Access to Medicare Act of 2014. https://www.govtrack.us/congress/bills/113/hr4302. Accessed June 5, 2014.
2. Coalition for ICD. Letter to CMS Administrator Tavenner, April 11, 2014. http://coalitionforicd10.wordpress.com/2014/03/26/letter-from-the-coalition-for-icd-10. Accessed June 5, 2014.
3. American Health Information Management Association. ICD-10-CM/PCS Transition: Planning and Preparation Checklist. http://journal.ahima.org/wp-content/uploads/ICD10-checklist.pdf. Accessed June 5, 2014.

Dr. Lenchus

Congress has once again delayed implementation of draconian Medicare cuts tied to the sustainable growth rate (SGR) formula. It was the 17th temporary patch applied to the ailing physician reimbursement program, so the decision caused little surprise.

But with the same legislation—the Protecting Access to Medicare Act of 2014—being used to delay the long-awaited debut of ICD-10, many hospitalists and physicians couldn’t help but wonder whether billing and coding would now be as much of a political football as the SGR fix.¹

The upshot: It doesn’t seem that way.

“I think it’s two separate issues,” says Phyllis “PJ” Floyd, RN, BSN, MBA, NE-BC, CCA, director of health information services and clinical documentation improvement at Medical University of South Carolina (MUSC) in Charleston, S.C. “The fact that it was all in one bill, I don’t know that it was well thought out as much as it was, ‘Let’s put the ICD-10 in here at the same time.’

“It was just a few sentences, and then it wasn’t even brought up in the discussion on the floor.”

Four policy wonks interviewed by The Hospitalist concurred that while tying the ICD-10 delay to the SGR issue was an unexpected and frustrating development, the coding system likely will be implemented in the relative short term. Meanwhile, a long-term resolution of the SGR dilemma remains much more elusive.

“For about 12 hours, I felt relief about the ICD-10 [being delayed], and then I just realized, it’s still coming, presumably,” says John Nelson, MD, MHM, a co-founder and past president of SHM and medical director of the hospitalist practice at Overlake Hospital Medical Center in Bellevue, Wash. “[It’s] like a patient who needs surgery and finds out it’s canceled for the day and he’ll have it tomorrow. Well, that’s good for right now, but [he] still has to face this eventually.”

“Doc-Pay” Fix Near?

Congress’ recent decision to delay both an SGR fix and the ICD-10 are troubling to some hospitalists and others for different reasons.

The SGR extension through this year’s end means that physicians do not face a 24% cut to physician payments under Medicare. SHM has long lobbied against temporary patches to the SGR, repeatedly backing legislation that would once and for all scrap the formula and replace it with something sustainable.

The SGR formula was first crafted in 1997, but the now often-delayed cuts were a byproduct of the federal sequester that was included in the Budget Control Act of 2011. At the time, the massive reduction to Medicare payments was tied to political brinksmanship over the country’s debt ceiling. The cuts were implemented as a doomsday scenario that was never likely to actually happen, but despite negotiations over the past three years, no long-term compromise can be found. Paying for the reform remains the main stumbling block.

“I think, this year, Congress was as close as it’s been in a long time to enacting a serious fix, aided by the agreement of major professional societies like the American College of Physicians and American College of Surgeons,” says David Howard, PhD, an associate professor in the department of health policy and management at the Rollins School of Public Health at Emory University in Atlanta. “They were all on board with this solution. ... Who knows, maybe if the economic situation continues to improve [and] tax revenues continue to go up...that will create a more favorable environment for compromise.”

Dr. Howard adds that while Congress might be close to a solution in theory, agreement on how to offset the roughly $100 billion in costs “is just very difficult.” That is why the healthcare professor is pessimistic that a long-term fix is truly at hand.

“The places where Congress might have looked for savings to offset the cost of the doc fix, such as hospital reimbursement rates or payment rates to Medicare Advantage plans—those are exactly the areas that the Affordable Care Act is targeting to pay for insurance expansion,” Dr. Howard adds. “So those areas of savings are not going to be available to offset the cost of the doc fix.”

ICD-10 Delays “Unfair”

Dr. Lenchus

The medical coding conundrum presents a different set of issues. The delay in transitioning healthcare providers from the ICD-9 medical coding classification system to the more complicated ICD-10 means the upgraded system is now against an Oct. 1, 2015, deadline. This comes after the Centers for Medicare & Medicaid Services (CMS) already pushed back the original implementation date for ICD-10 by one year.

SHM Public Policy Committee member Joshua Lenchus, DO, RPh, FACP, SFHM, says he thinks most doctors are content with the delay, particularly in light of some estimates that show that only about 20% of physicians “have actually initiated the ICD-10 transition.” But he also notes that it’s unfair to the health systems that have prepared for ICD-10.

“ICD-9 has a little more than 14,000 diagnostic codes and nearly 4,000 procedural codes. That is to be contrasted to ICD-10, which has more than 68,000 diagnostic codes ... and over 72,000 procedural codes,” Dr. Lenchus says. “So, it is not surprising that many take solace in the delay.”

Dr. Nelson says the level of frustration for hospitalists is growing; however, the level of disruption for hospitals and health systems is reaching a boiling point.

“Of course, in some places, hospitalists may be the physician lead on ICD-10 efforts, so [they are] very much wrapped up in the problem of ‘What do we do now?’”

The answer, at least to the Coalition for ICD-10, a group of medical/technology trade groups, is to fight to ensure that the delays go no further. In an April letter to CMS Administrator Marilyn Tavenner, the coalition made that case, noting that in 2012, “CMS estimated the cost to the healthcare industry of a one-year delay to be as much as $6.6 billion, or approximately 30% of the $22 billion that CMS estimated had been invested or budgeted for ICD-10 implementation.”²

The letter went on to explain that the disruption and cost will grow each time the ICD-10 deadline is pushed.

“Furthermore, as CMS stated in 2012, implementation costs will continue to increase considerably with every year of a delay,” according to the letter. “The lost opportunity costs of failing to move to a more effective code set also continue to climb every year.”

Stay Engaged, Switch Gears

One of Floyd’s biggest concerns is that the ICD-10 implementation delays will affect physician engagement. The hospitalist groups at MUSC began training for ICD-10 in January 2013; however, the preparation and training were geared toward a 2014 implementation.

“You have to switch gears a little bit,” she says. “What we plan to do now is begin to do heavy auditing, and then from those audits we can give real-time feedback on what we’re doing well and what we’re not doing well. So I think that will be a method for engagement.”

She urges hospitalists, practice leaders, and informatics professionals to discuss ICD-10 not as a theoretical application, but as one tied to reimbursement that will have major impact in the years ahead. To that end, the American Health Information Management Association highlights the fact that the new coding system will result in higher-quality data that can improve performance measures, provide “increased sensitivity” to reimbursement methodologies, and help with stronger public health surveillance.³

“A lot of physicians see this as a hospital issue, and I think that’s why they shy away,” Floyd says. “Now there are some physicians who are interested in how well the hospital does, but the other piece is that it does affect things like [reduced] risk of mortality [and] comparison of data worldwide—those are things that we just have to continue to reiterate … and give them real examples.”

Richard Quinn is a freelance writer in New Jersey.

References

1. Govtrack. H.R. 4302: Protecting Access to Medicare Act of 2014. https://www.govtrack.us/congress/bills/113/hr4302. Accessed June 5, 2014.
2. Coalition for ICD. Letter to CMS Administrator Tavenner, April 11, 2014. http://coalitionforicd10.wordpress.com/2014/03/26/letter-from-the-coalition-for-icd-10. Accessed June 5, 2014.
3. American Health Information Management Association. ICD-10-CM/PCS Transition: Planning and Preparation Checklist. http://journal.ahima.org/wp-content/uploads/ICD10-checklist.pdf. Accessed June 5, 2014.

Dr. Lenchus

Congress has once again delayed implementation of draconian Medicare cuts tied to the sustainable growth rate (SGR) formula. It was the 17th temporary patch applied to the ailing physician reimbursement program, so the decision caused little surprise.

But with the same legislation—the Protecting Access to Medicare Act of 2014—being used to delay the long-awaited debut of ICD-10, many hospitalists and physicians couldn’t help but wonder whether billing and coding would now be as much of a political football as the SGR fix.¹

The upshot: It doesn’t seem that way.

“I think it’s two separate issues,” says Phyllis “PJ” Floyd, RN, BSN, MBA, NE-BC, CCA, director of health information services and clinical documentation improvement at Medical University of South Carolina (MUSC) in Charleston, S.C. “The fact that it was all in one bill, I don’t know that it was well thought out as much as it was, ‘Let’s put the ICD-10 in here at the same time.’

“It was just a few sentences, and then it wasn’t even brought up in the discussion on the floor.”

Four policy wonks interviewed by The Hospitalist concurred that while tying the ICD-10 delay to the SGR issue was an unexpected and frustrating development, the coding system likely will be implemented in the relative short term. Meanwhile, a long-term resolution of the SGR dilemma remains much more elusive.

“For about 12 hours, I felt relief about the ICD-10 [being delayed], and then I just realized, it’s still coming, presumably,” says John Nelson, MD, MHM, a co-founder and past president of SHM and medical director of the hospitalist practice at Overlake Hospital Medical Center in Bellevue, Wash. “[It’s] like a patient who needs surgery and finds out it’s canceled for the day and he’ll have it tomorrow. Well, that’s good for right now, but [he] still has to face this eventually.”

“Doc-Pay” Fix Near?

Congress’ recent decision to delay both an SGR fix and the ICD-10 are troubling to some hospitalists and others for different reasons.

The SGR extension through this year’s end means that physicians do not face a 24% cut to physician payments under Medicare. SHM has long lobbied against temporary patches to the SGR, repeatedly backing legislation that would once and for all scrap the formula and replace it with something sustainable.

The SGR formula was first crafted in 1997, but the now often-delayed cuts were a byproduct of the federal sequester that was included in the Budget Control Act of 2011. At the time, the massive reduction to Medicare payments was tied to political brinksmanship over the country’s debt ceiling. The cuts were implemented as a doomsday scenario that was never likely to actually happen, but despite negotiations over the past three years, no long-term compromise can be found. Paying for the reform remains the main stumbling block.

“I think, this year, Congress was as close as it’s been in a long time to enacting a serious fix, aided by the agreement of major professional societies like the American College of Physicians and American College of Surgeons,” says David Howard, PhD, an associate professor in the department of health policy and management at the Rollins School of Public Health at Emory University in Atlanta. “They were all on board with this solution. ... Who knows, maybe if the economic situation continues to improve [and] tax revenues continue to go up...that will create a more favorable environment for compromise.”

Dr. Howard adds that while Congress might be close to a solution in theory, agreement on how to offset the roughly $100 billion in costs “is just very difficult.” That is why the healthcare professor is pessimistic that a long-term fix is truly at hand.

“The places where Congress might have looked for savings to offset the cost of the doc fix, such as hospital reimbursement rates or payment rates to Medicare Advantage plans—those are exactly the areas that the Affordable Care Act is targeting to pay for insurance expansion,” Dr. Howard adds. “So those areas of savings are not going to be available to offset the cost of the doc fix.”

ICD-10 Delays “Unfair”

Dr. Lenchus

The medical coding conundrum presents a different set of issues. The delay in transitioning healthcare providers from the ICD-9 medical coding classification system to the more complicated ICD-10 means the upgraded system is now against an Oct. 1, 2015, deadline. This comes after the Centers for Medicare & Medicaid Services (CMS) already pushed back the original implementation date for ICD-10 by one year.

SHM Public Policy Committee member Joshua Lenchus, DO, RPh, FACP, SFHM, says he thinks most doctors are content with the delay, particularly in light of some estimates that show that only about 20% of physicians “have actually initiated the ICD-10 transition.” But he also notes that it’s unfair to the health systems that have prepared for ICD-10.

“ICD-9 has a little more than 14,000 diagnostic codes and nearly 4,000 procedural codes. That is to be contrasted to ICD-10, which has more than 68,000 diagnostic codes ... and over 72,000 procedural codes,” Dr. Lenchus says. “So, it is not surprising that many take solace in the delay.”

Dr. Nelson says the level of frustration for hospitalists is growing; however, the level of disruption for hospitals and health systems is reaching a boiling point.

“Of course, in some places, hospitalists may be the physician lead on ICD-10 efforts, so [they are] very much wrapped up in the problem of ‘What do we do now?’”

The answer, at least to the Coalition for ICD-10, a group of medical/technology trade groups, is to fight to ensure that the delays go no further. In an April letter to CMS Administrator Marilyn Tavenner, the coalition made that case, noting that in 2012, “CMS estimated the cost to the healthcare industry of a one-year delay to be as much as $6.6 billion, or approximately 30% of the $22 billion that CMS estimated had been invested or budgeted for ICD-10 implementation.”²

The letter went on to explain that the disruption and cost will grow each time the ICD-10 deadline is pushed.

“Furthermore, as CMS stated in 2012, implementation costs will continue to increase considerably with every year of a delay,” according to the letter. “The lost opportunity costs of failing to move to a more effective code set also continue to climb every year.”

Stay Engaged, Switch Gears

One of Floyd’s biggest concerns is that the ICD-10 implementation delays will affect physician engagement. The hospitalist groups at MUSC began training for ICD-10 in January 2013; however, the preparation and training were geared toward a 2014 implementation.

“You have to switch gears a little bit,” she says. “What we plan to do now is begin to do heavy auditing, and then from those audits we can give real-time feedback on what we’re doing well and what we’re not doing well. So I think that will be a method for engagement.”

She urges hospitalists, practice leaders, and informatics professionals to discuss ICD-10 not as a theoretical application, but as one tied to reimbursement that will have major impact in the years ahead. To that end, the American Health Information Management Association highlights the fact that the new coding system will result in higher-quality data that can improve performance measures, provide “increased sensitivity” to reimbursement methodologies, and help with stronger public health surveillance.³

“A lot of physicians see this as a hospital issue, and I think that’s why they shy away,” Floyd says. “Now there are some physicians who are interested in how well the hospital does, but the other piece is that it does affect things like [reduced] risk of mortality [and] comparison of data worldwide—those are things that we just have to continue to reiterate … and give them real examples.”

Richard Quinn is a freelance writer in New Jersey.

References

1. Govtrack. H.R. 4302: Protecting Access to Medicare Act of 2014. https://www.govtrack.us/congress/bills/113/hr4302. Accessed June 5, 2014.
2. Coalition for ICD. Letter to CMS Administrator Tavenner, April 11, 2014. http://coalitionforicd10.wordpress.com/2014/03/26/letter-from-the-coalition-for-icd-10. Accessed June 5, 2014.
3. American Health Information Management Association. ICD-10-CM/PCS Transition: Planning and Preparation Checklist. http://journal.ahima.org/wp-content/uploads/ICD10-checklist.pdf. Accessed June 5, 2014.

Dr. Scheurer

We talk a lot about value in healthcare—about how to enhance quality and reduce cost—because we all know both need an incredible amount of work. One tactic Medicare is using to improve the value equation on a large scale is aggregating and displaying physician-specific “value” metrics. These metrics, which will be used to deduct or enhance reimbursement for physicians, are known as the Physician Value-Based Payment Modifier (PVBM).

This program has been enacted fairly rapidly since the passage of the Affordable Care Act; it is being rolled out first to large physician practices, then to all groups by 2017. Those with superior performance in both quality and cost will experience as much as a 2% higher reimbursement, while groups with average performance will remain financially neutral and those who show lower performance or choose not to report will be penalized up to 1% of Medicare reimbursement. This first round, for larger groups of 100-plus physicians, will affect about 30% of all U.S. physicians. The second round, for groups of 10 or more physicians, will affect about another third of physicians. The last round, for groups with fewer than 10 physicians, will be applicable to the remaining physicians practicing in the U.S.

On the face of it, the program does seem to be a potentially effective tactic for improving value on a large scale, holding individual physicians accountable for their own individual patient-care performance. A few fatal flaws in the program as it currently stands make it extraordinarily unlikely to be universally adopted by all physicians, however. Here are a few of those flaws:^1,2

1 Uncertain yield: Because it is essentially a “zero-sum game” for Medicare, the incentive or penalty for a physician (or the physician’s group) depends on the performance of all the other physicians’ or groups’ performance. As a result, there is incredible uncertainty as to how strong a physician’s performance actually needs to be, year to year, to result in a bonus payment. Given that many of the metrics will require some type of investment to perform well, such as information technology infrastructure or a quality coordinator, there is an equal amount of uncertainty about how much investment will be needed to get a certain budgetary yield. For smaller physician practices, taking a 1% to 2% reduction in Medicare reimbursements may be easier to weather financially than investing in the infrastructure needed to reliably hit the quality metrics for every relevant patient.

2 Uncertain benchmarks: Unlike many hospital quality metrics, which have been publicly displayed for years, physician-level value metrics are just now being reported publicly. This leaves uncertainty about how strong a physician’s performance needs to be in order to be better than average. In the hospital value-based purchasing program, “average” performance is extremely good, in the 98% to 99% compliance range for most metrics. It is less clear what compliance range will be “average” in the physician-based program.

3 Physician variability: More than a half million physicians in the U.S. bill Medicare, and their practice types range from primary care solo practice to multi-group specialty practice. Motivating all brands to understand, measure, report, and improve quality metrics is a yeoman’s task, unlikely to be successful in the short term. Most physicians have not received any formal education or training in quality improvement, so they may not even have the skill set required to improve their metrics into a highly reliable range, worthy of bonus designation.

4 Metric identity and attribution: Because the repertoire of physician types is broad, the ability of each physician type to have a set of metrics that they understand and can identify with is extremely unlikely. In addition, attribution of patients and their associated metrics to any single physician is complicated, especially for patients who are cared for by many different physicians across a number of settings. For hospitalists, the attribution issue is a fatal flaw, as many groups routinely “hand off” patients among other hospitalists in their group, at least once if not several times during a typical hospital stay. The same is true of many other hospital-based specialty physicians.

5 Playing to the test: As with other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to play to the test, so that their efforts to perform exceedingly well at a few metrics will crowd out and hinder their performance on unmeasured metrics. This tendency can result in lower-value care in the sum total, even if the metrics show stellar performance.

6 Reducing the risk: As seen in other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to avoid caring for patients who are likely to be unpredictable, including those with multiple co-morbid conditions or with complex social situations; these patients are likely to perform less well on any metric, despite risk adjusting (which is inherently imperfect). This is a well-known and documented risk of publicly reported programs, and there is no reason to believe the PVBM program will be immune to this risk.

In Sum

Because these flaws seem so daunting at first glance, many physicians and physician groups will be tempted to reject the program outright and take the financial hit induced by nonparticipation. An alternative approach is to embrace all of the value programs outright, investing time and energy in improving the metrics that are truly valuable to both patients and providers.

Regardless of which regulatory agency is demanding performance, we need to be active participants in foraging out what metrics and attribution logic are most appropriate. For hospitalists, these could include risk-adjusted device days, appropriate prescribing and unprescribing of antibiotics, judicious utilization of diagnostic testing, and measurements of patient functional status and/or mobility.

Value metrics are here to stay, including those attributable to individual physicians; our job now is to advocate for meaningful metrics and meaningful attribution, which can and should motivate hospitalists to enhance their patients’ quality of life at a lower cost.

Dr. Scheurer is a hospitalist and chief quality officer at the Medical University of South Carolina in Charleston. She is physician editor of The Hospitalist. Email her at scheured@musc.edu.

References

1. Chien AT, Rosenthal MB. Medicare’s physician value based payment modifier—will the techtonic shift create waves? N Engl J Med. 2013;369(22):2076-2078.
2. Berenson RA, Kaye DR. Grading a physician’s value—the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2081.

Dr. Scheurer

We talk a lot about value in healthcare—about how to enhance quality and reduce cost—because we all know both need an incredible amount of work. One tactic Medicare is using to improve the value equation on a large scale is aggregating and displaying physician-specific “value” metrics. These metrics, which will be used to deduct or enhance reimbursement for physicians, are known as the Physician Value-Based Payment Modifier (PVBM).

This program has been enacted fairly rapidly since the passage of the Affordable Care Act; it is being rolled out first to large physician practices, then to all groups by 2017. Those with superior performance in both quality and cost will experience as much as a 2% higher reimbursement, while groups with average performance will remain financially neutral and those who show lower performance or choose not to report will be penalized up to 1% of Medicare reimbursement. This first round, for larger groups of 100-plus physicians, will affect about 30% of all U.S. physicians. The second round, for groups of 10 or more physicians, will affect about another third of physicians. The last round, for groups with fewer than 10 physicians, will be applicable to the remaining physicians practicing in the U.S.

On the face of it, the program does seem to be a potentially effective tactic for improving value on a large scale, holding individual physicians accountable for their own individual patient-care performance. A few fatal flaws in the program as it currently stands make it extraordinarily unlikely to be universally adopted by all physicians, however. Here are a few of those flaws:^1,2

1 Uncertain yield: Because it is essentially a “zero-sum game” for Medicare, the incentive or penalty for a physician (or the physician’s group) depends on the performance of all the other physicians’ or groups’ performance. As a result, there is incredible uncertainty as to how strong a physician’s performance actually needs to be, year to year, to result in a bonus payment. Given that many of the metrics will require some type of investment to perform well, such as information technology infrastructure or a quality coordinator, there is an equal amount of uncertainty about how much investment will be needed to get a certain budgetary yield. For smaller physician practices, taking a 1% to 2% reduction in Medicare reimbursements may be easier to weather financially than investing in the infrastructure needed to reliably hit the quality metrics for every relevant patient.

2 Uncertain benchmarks: Unlike many hospital quality metrics, which have been publicly displayed for years, physician-level value metrics are just now being reported publicly. This leaves uncertainty about how strong a physician’s performance needs to be in order to be better than average. In the hospital value-based purchasing program, “average” performance is extremely good, in the 98% to 99% compliance range for most metrics. It is less clear what compliance range will be “average” in the physician-based program.

3 Physician variability: More than a half million physicians in the U.S. bill Medicare, and their practice types range from primary care solo practice to multi-group specialty practice. Motivating all brands to understand, measure, report, and improve quality metrics is a yeoman’s task, unlikely to be successful in the short term. Most physicians have not received any formal education or training in quality improvement, so they may not even have the skill set required to improve their metrics into a highly reliable range, worthy of bonus designation.

4 Metric identity and attribution: Because the repertoire of physician types is broad, the ability of each physician type to have a set of metrics that they understand and can identify with is extremely unlikely. In addition, attribution of patients and their associated metrics to any single physician is complicated, especially for patients who are cared for by many different physicians across a number of settings. For hospitalists, the attribution issue is a fatal flaw, as many groups routinely “hand off” patients among other hospitalists in their group, at least once if not several times during a typical hospital stay. The same is true of many other hospital-based specialty physicians.

5 Playing to the test: As with other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to play to the test, so that their efforts to perform exceedingly well at a few metrics will crowd out and hinder their performance on unmeasured metrics. This tendency can result in lower-value care in the sum total, even if the metrics show stellar performance.

6 Reducing the risk: As seen in other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to avoid caring for patients who are likely to be unpredictable, including those with multiple co-morbid conditions or with complex social situations; these patients are likely to perform less well on any metric, despite risk adjusting (which is inherently imperfect). This is a well-known and documented risk of publicly reported programs, and there is no reason to believe the PVBM program will be immune to this risk.

In Sum

Because these flaws seem so daunting at first glance, many physicians and physician groups will be tempted to reject the program outright and take the financial hit induced by nonparticipation. An alternative approach is to embrace all of the value programs outright, investing time and energy in improving the metrics that are truly valuable to both patients and providers.

Regardless of which regulatory agency is demanding performance, we need to be active participants in foraging out what metrics and attribution logic are most appropriate. For hospitalists, these could include risk-adjusted device days, appropriate prescribing and unprescribing of antibiotics, judicious utilization of diagnostic testing, and measurements of patient functional status and/or mobility.

Value metrics are here to stay, including those attributable to individual physicians; our job now is to advocate for meaningful metrics and meaningful attribution, which can and should motivate hospitalists to enhance their patients’ quality of life at a lower cost.

Dr. Scheurer is a hospitalist and chief quality officer at the Medical University of South Carolina in Charleston. She is physician editor of The Hospitalist. Email her at scheured@musc.edu.

References

1. Chien AT, Rosenthal MB. Medicare’s physician value based payment modifier—will the techtonic shift create waves? N Engl J Med. 2013;369(22):2076-2078.
2. Berenson RA, Kaye DR. Grading a physician’s value—the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2081.

Dr. Scheurer

We talk a lot about value in healthcare—about how to enhance quality and reduce cost—because we all know both need an incredible amount of work. One tactic Medicare is using to improve the value equation on a large scale is aggregating and displaying physician-specific “value” metrics. These metrics, which will be used to deduct or enhance reimbursement for physicians, are known as the Physician Value-Based Payment Modifier (PVBM).

This program has been enacted fairly rapidly since the passage of the Affordable Care Act; it is being rolled out first to large physician practices, then to all groups by 2017. Those with superior performance in both quality and cost will experience as much as a 2% higher reimbursement, while groups with average performance will remain financially neutral and those who show lower performance or choose not to report will be penalized up to 1% of Medicare reimbursement. This first round, for larger groups of 100-plus physicians, will affect about 30% of all U.S. physicians. The second round, for groups of 10 or more physicians, will affect about another third of physicians. The last round, for groups with fewer than 10 physicians, will be applicable to the remaining physicians practicing in the U.S.

On the face of it, the program does seem to be a potentially effective tactic for improving value on a large scale, holding individual physicians accountable for their own individual patient-care performance. A few fatal flaws in the program as it currently stands make it extraordinarily unlikely to be universally adopted by all physicians, however. Here are a few of those flaws:^1,2

1 Uncertain yield: Because it is essentially a “zero-sum game” for Medicare, the incentive or penalty for a physician (or the physician’s group) depends on the performance of all the other physicians’ or groups’ performance. As a result, there is incredible uncertainty as to how strong a physician’s performance actually needs to be, year to year, to result in a bonus payment. Given that many of the metrics will require some type of investment to perform well, such as information technology infrastructure or a quality coordinator, there is an equal amount of uncertainty about how much investment will be needed to get a certain budgetary yield. For smaller physician practices, taking a 1% to 2% reduction in Medicare reimbursements may be easier to weather financially than investing in the infrastructure needed to reliably hit the quality metrics for every relevant patient.

2 Uncertain benchmarks: Unlike many hospital quality metrics, which have been publicly displayed for years, physician-level value metrics are just now being reported publicly. This leaves uncertainty about how strong a physician’s performance needs to be in order to be better than average. In the hospital value-based purchasing program, “average” performance is extremely good, in the 98% to 99% compliance range for most metrics. It is less clear what compliance range will be “average” in the physician-based program.

3 Physician variability: More than a half million physicians in the U.S. bill Medicare, and their practice types range from primary care solo practice to multi-group specialty practice. Motivating all brands to understand, measure, report, and improve quality metrics is a yeoman’s task, unlikely to be successful in the short term. Most physicians have not received any formal education or training in quality improvement, so they may not even have the skill set required to improve their metrics into a highly reliable range, worthy of bonus designation.

4 Metric identity and attribution: Because the repertoire of physician types is broad, the ability of each physician type to have a set of metrics that they understand and can identify with is extremely unlikely. In addition, attribution of patients and their associated metrics to any single physician is complicated, especially for patients who are cared for by many different physicians across a number of settings. For hospitalists, the attribution issue is a fatal flaw, as many groups routinely “hand off” patients among other hospitalists in their group, at least once if not several times during a typical hospital stay. The same is true of many other hospital-based specialty physicians.

5 Playing to the test: As with other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to play to the test, so that their efforts to perform exceedingly well at a few metrics will crowd out and hinder their performance on unmeasured metrics. This tendency can result in lower-value care in the sum total, even if the metrics show stellar performance.

6 Reducing the risk: As seen in other pay-for-performance programs, there is a legitimate concern that physicians will be overwhelmingly motivated to avoid caring for patients who are likely to be unpredictable, including those with multiple co-morbid conditions or with complex social situations; these patients are likely to perform less well on any metric, despite risk adjusting (which is inherently imperfect). This is a well-known and documented risk of publicly reported programs, and there is no reason to believe the PVBM program will be immune to this risk.

In Sum

Because these flaws seem so daunting at first glance, many physicians and physician groups will be tempted to reject the program outright and take the financial hit induced by nonparticipation. An alternative approach is to embrace all of the value programs outright, investing time and energy in improving the metrics that are truly valuable to both patients and providers.

Regardless of which regulatory agency is demanding performance, we need to be active participants in foraging out what metrics and attribution logic are most appropriate. For hospitalists, these could include risk-adjusted device days, appropriate prescribing and unprescribing of antibiotics, judicious utilization of diagnostic testing, and measurements of patient functional status and/or mobility.

Value metrics are here to stay, including those attributable to individual physicians; our job now is to advocate for meaningful metrics and meaningful attribution, which can and should motivate hospitalists to enhance their patients’ quality of life at a lower cost.

Dr. Scheurer is a hospitalist and chief quality officer at the Medical University of South Carolina in Charleston. She is physician editor of The Hospitalist. Email her at scheured@musc.edu.

References

1. Chien AT, Rosenthal MB. Medicare’s physician value based payment modifier—will the techtonic shift create waves? N Engl J Med. 2013;369(22):2076-2078.
2. Berenson RA, Kaye DR. Grading a physician’s value—the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2081.

Only 27% of eligible providers participated in the Physician Quality Reporting System (PQRS) in 2011—roughly 26,500 medical practices and 266,500 medical professionals, according to the Centers for Medicare & Medicaid Services (CMS).

“A lot of physicians have walked away [from PQRS] feeling like there are not sufficient measures for them to be measured against,” says Cheryl Damberg, senior principal researcher at RAND corporation and professor at the Pardee RAND Graduate School in Santa Monica, Calif.

Encouraging more participation from hospitalists has been the goal of the Society of Hospital Medicine (SHM) for the last several years, says Gregory Seymann, MD, SFHM, clinical professor and chief in the division of hospital medicine at University of California San Diego Health Sciences and chair of SHM’s Performance Measurement and Reporting Committee (PMRC).

“The committee has tried to champion it the best we can, making sure the measures that are there and in development meet the needs of the specialty,” Dr. Seymann says.

In just one year, the SHM committee managed to increase hospitalist reportable measures in PQRS from a paltry 11—half of which were only for stroke patients—to 21, which now includes things like diabetes exams, osteoporosis management, documentation of current medications, and community-acquired pneumonia treatment.

For Comparison’s Sake

For the first couple of phases of PQRS reporting, very few measures were relevant to hospitalists, Dr. Seymann says. The committee worked to ensure that more measures were added and billing codes modified to include those used by the specialty. Hospital medicine is relatively new, not officially recognized by the American Board of Medical Specialties (ABMS), and hospitalists serve a unique role. Most hospitalists are in internal medicine, family medicine, or pediatrics, but they aren’t doing what the average primary care doctor does, like referral for breast cancer or colon cancer screening, Dr. Seymann adds. Additionally, they aren’t always the provider performing specific cardiac or neurological care.

Hospitalists’ patients usually are in the hospital because they are sick. They may have chronic disease or more complex medical needs (e.g. osteoporosis-related hip fracture) than the average population seen by a non-hospitalist PCP.

If hospitalists are compared to other PCPs, as is the plan in the Physician Value-Based Payment Modifier, it “looks like our patients are dying a lot more frequently, we’re spending a lot of money, and we’re not doing primary care,” Dr. Seymann explains.

New Brand, New Push

PQRS is not new; it is the rebranding of CMS’ Physician Quality Reporting Initiative (PQRI), launched in 2006. But changes to the program are part of a national push to improve healthcare quality and patient care while reimbursing for performance on outcome- and process-based measures instead of simply for the volume of services provided. Each year, CMS updates PQRS rules.

This year is the last one in which providers will receive a bonus for reporting through PQRS. Beginning next year, practitioners that don’t meet the reporting requirements for 2013 will incur a 1.5% penalty—with additional penalties for physicians in groups of 100 or more from the value-based payment modifier. This year also serves as the performance year for 2016, when a 2% penalty for insufficient reporting will be assessed.

In early December 2013, the Centers for Medicare & Medicaid Services (CMS) published the 2014 Physician Fee Schedule and, with it, the final rules for the PQRS. Although many physicians and specialist groups believed the measures included in PQRS in previous years were too limited, CMS has added the additional reporting methodology of qualified clinical data registries (QCDR), which can include measures outside of the PQRS—a marked shift from previous policies.

The rule change, Damberg says, should take some energy out of the discussion surrounding the program and allow more physicians to participate.

“From CMS’ perspective, they want doctors delivering the recommended care and they want doctors to be able to report it out easily,” Damberg says.

Moving Forward

In 2014, providers can submit measures through the new QCDR option, or submit PQRS-identified measures through a Medicare qualified registry, through electronic health records, through the group practice reporting option (GPRO), and through claims-based reporting (though this last option is expected to be phased out over time).

Registries themselves are not new, but they can cost millions of dollars to establish and as much as a million a year to maintain. They typically contain more clinical depth and specificity than claims data, and numerous studies show the use of registries leads to improved patient outcomes.

“We don’t know how many [existing] registries are going to qualify to become these qualified clinical data registries,” says Tom Granatir, senior vice president for health policy and external relations at ABMS. “It’s going to take some time for these registries to evolve.”

Qualified clinical data registries must be in operation for at least one year to be eligible for certification by Medicare. They must include performance data from other payers beyond Medicare. Not only must QCDRs be capable of capturing and sending data, they must also provide national benchmarks to those who submit and must report back at least four times per year.

Granatir believes the QCDR rule, which allows QCDR’s to report measures beyond those included in the PQRS program, will help increase participation and will lead to more practice-based measures, but he fears it may exclude some important nuances of day-to-day patient care.

“The whole point [of quality measure reporting] is to create more public transparency…but if you have measures that are not relevant to what is actually done in practices, then it’s not a useful dataset,” he says.

Ideally, Damberg says, PQRS and other performance measures should enable physicians to do what they do better.

“I think this is really going to raise the stakes for [hospitalists] if they want to control their destiny,” Damberg says. “I think they have to get really engaged in this game and take a pro-active role in looking at where the quality gaps are and how can they better benefit patients. That’s the ultimate goal.”

Kelly April Tyrrell is a freelance writer in Wilmington, Del.

Only 27% of eligible providers participated in the Physician Quality Reporting System (PQRS) in 2011—roughly 26,500 medical practices and 266,500 medical professionals, according to the Centers for Medicare & Medicaid Services (CMS).

“A lot of physicians have walked away [from PQRS] feeling like there are not sufficient measures for them to be measured against,” says Cheryl Damberg, senior principal researcher at RAND corporation and professor at the Pardee RAND Graduate School in Santa Monica, Calif.

Encouraging more participation from hospitalists has been the goal of the Society of Hospital Medicine (SHM) for the last several years, says Gregory Seymann, MD, SFHM, clinical professor and chief in the division of hospital medicine at University of California San Diego Health Sciences and chair of SHM’s Performance Measurement and Reporting Committee (PMRC).

“The committee has tried to champion it the best we can, making sure the measures that are there and in development meet the needs of the specialty,” Dr. Seymann says.

In just one year, the SHM committee managed to increase hospitalist reportable measures in PQRS from a paltry 11—half of which were only for stroke patients—to 21, which now includes things like diabetes exams, osteoporosis management, documentation of current medications, and community-acquired pneumonia treatment.

For Comparison’s Sake

For the first couple of phases of PQRS reporting, very few measures were relevant to hospitalists, Dr. Seymann says. The committee worked to ensure that more measures were added and billing codes modified to include those used by the specialty. Hospital medicine is relatively new, not officially recognized by the American Board of Medical Specialties (ABMS), and hospitalists serve a unique role. Most hospitalists are in internal medicine, family medicine, or pediatrics, but they aren’t doing what the average primary care doctor does, like referral for breast cancer or colon cancer screening, Dr. Seymann adds. Additionally, they aren’t always the provider performing specific cardiac or neurological care.

Hospitalists’ patients usually are in the hospital because they are sick. They may have chronic disease or more complex medical needs (e.g. osteoporosis-related hip fracture) than the average population seen by a non-hospitalist PCP.

If hospitalists are compared to other PCPs, as is the plan in the Physician Value-Based Payment Modifier, it “looks like our patients are dying a lot more frequently, we’re spending a lot of money, and we’re not doing primary care,” Dr. Seymann explains.

New Brand, New Push

PQRS is not new; it is the rebranding of CMS’ Physician Quality Reporting Initiative (PQRI), launched in 2006. But changes to the program are part of a national push to improve healthcare quality and patient care while reimbursing for performance on outcome- and process-based measures instead of simply for the volume of services provided. Each year, CMS updates PQRS rules.

This year is the last one in which providers will receive a bonus for reporting through PQRS. Beginning next year, practitioners that don’t meet the reporting requirements for 2013 will incur a 1.5% penalty—with additional penalties for physicians in groups of 100 or more from the value-based payment modifier. This year also serves as the performance year for 2016, when a 2% penalty for insufficient reporting will be assessed.

In early December 2013, the Centers for Medicare & Medicaid Services (CMS) published the 2014 Physician Fee Schedule and, with it, the final rules for the PQRS. Although many physicians and specialist groups believed the measures included in PQRS in previous years were too limited, CMS has added the additional reporting methodology of qualified clinical data registries (QCDR), which can include measures outside of the PQRS—a marked shift from previous policies.

The rule change, Damberg says, should take some energy out of the discussion surrounding the program and allow more physicians to participate.

“From CMS’ perspective, they want doctors delivering the recommended care and they want doctors to be able to report it out easily,” Damberg says.

Moving Forward

In 2014, providers can submit measures through the new QCDR option, or submit PQRS-identified measures through a Medicare qualified registry, through electronic health records, through the group practice reporting option (GPRO), and through claims-based reporting (though this last option is expected to be phased out over time).

Registries themselves are not new, but they can cost millions of dollars to establish and as much as a million a year to maintain. They typically contain more clinical depth and specificity than claims data, and numerous studies show the use of registries leads to improved patient outcomes.

“We don’t know how many [existing] registries are going to qualify to become these qualified clinical data registries,” says Tom Granatir, senior vice president for health policy and external relations at ABMS. “It’s going to take some time for these registries to evolve.”

Qualified clinical data registries must be in operation for at least one year to be eligible for certification by Medicare. They must include performance data from other payers beyond Medicare. Not only must QCDRs be capable of capturing and sending data, they must also provide national benchmarks to those who submit and must report back at least four times per year.

Granatir believes the QCDR rule, which allows QCDR’s to report measures beyond those included in the PQRS program, will help increase participation and will lead to more practice-based measures, but he fears it may exclude some important nuances of day-to-day patient care.

“The whole point [of quality measure reporting] is to create more public transparency…but if you have measures that are not relevant to what is actually done in practices, then it’s not a useful dataset,” he says.

Ideally, Damberg says, PQRS and other performance measures should enable physicians to do what they do better.

“I think this is really going to raise the stakes for [hospitalists] if they want to control their destiny,” Damberg says. “I think they have to get really engaged in this game and take a pro-active role in looking at where the quality gaps are and how can they better benefit patients. That’s the ultimate goal.”

Kelly April Tyrrell is a freelance writer in Wilmington, Del.

Only 27% of eligible providers participated in the Physician Quality Reporting System (PQRS) in 2011—roughly 26,500 medical practices and 266,500 medical professionals, according to the Centers for Medicare & Medicaid Services (CMS).

“A lot of physicians have walked away [from PQRS] feeling like there are not sufficient measures for them to be measured against,” says Cheryl Damberg, senior principal researcher at RAND corporation and professor at the Pardee RAND Graduate School in Santa Monica, Calif.

Encouraging more participation from hospitalists has been the goal of the Society of Hospital Medicine (SHM) for the last several years, says Gregory Seymann, MD, SFHM, clinical professor and chief in the division of hospital medicine at University of California San Diego Health Sciences and chair of SHM’s Performance Measurement and Reporting Committee (PMRC).

“The committee has tried to champion it the best we can, making sure the measures that are there and in development meet the needs of the specialty,” Dr. Seymann says.

In just one year, the SHM committee managed to increase hospitalist reportable measures in PQRS from a paltry 11—half of which were only for stroke patients—to 21, which now includes things like diabetes exams, osteoporosis management, documentation of current medications, and community-acquired pneumonia treatment.

For Comparison’s Sake

For the first couple of phases of PQRS reporting, very few measures were relevant to hospitalists, Dr. Seymann says. The committee worked to ensure that more measures were added and billing codes modified to include those used by the specialty. Hospital medicine is relatively new, not officially recognized by the American Board of Medical Specialties (ABMS), and hospitalists serve a unique role. Most hospitalists are in internal medicine, family medicine, or pediatrics, but they aren’t doing what the average primary care doctor does, like referral for breast cancer or colon cancer screening, Dr. Seymann adds. Additionally, they aren’t always the provider performing specific cardiac or neurological care.

Hospitalists’ patients usually are in the hospital because they are sick. They may have chronic disease or more complex medical needs (e.g. osteoporosis-related hip fracture) than the average population seen by a non-hospitalist PCP.

If hospitalists are compared to other PCPs, as is the plan in the Physician Value-Based Payment Modifier, it “looks like our patients are dying a lot more frequently, we’re spending a lot of money, and we’re not doing primary care,” Dr. Seymann explains.

New Brand, New Push

PQRS is not new; it is the rebranding of CMS’ Physician Quality Reporting Initiative (PQRI), launched in 2006. But changes to the program are part of a national push to improve healthcare quality and patient care while reimbursing for performance on outcome- and process-based measures instead of simply for the volume of services provided. Each year, CMS updates PQRS rules.

This year is the last one in which providers will receive a bonus for reporting through PQRS. Beginning next year, practitioners that don’t meet the reporting requirements for 2013 will incur a 1.5% penalty—with additional penalties for physicians in groups of 100 or more from the value-based payment modifier. This year also serves as the performance year for 2016, when a 2% penalty for insufficient reporting will be assessed.

In early December 2013, the Centers for Medicare & Medicaid Services (CMS) published the 2014 Physician Fee Schedule and, with it, the final rules for the PQRS. Although many physicians and specialist groups believed the measures included in PQRS in previous years were too limited, CMS has added the additional reporting methodology of qualified clinical data registries (QCDR), which can include measures outside of the PQRS—a marked shift from previous policies.

The rule change, Damberg says, should take some energy out of the discussion surrounding the program and allow more physicians to participate.

“From CMS’ perspective, they want doctors delivering the recommended care and they want doctors to be able to report it out easily,” Damberg says.

Moving Forward

In 2014, providers can submit measures through the new QCDR option, or submit PQRS-identified measures through a Medicare qualified registry, through electronic health records, through the group practice reporting option (GPRO), and through claims-based reporting (though this last option is expected to be phased out over time).

Registries themselves are not new, but they can cost millions of dollars to establish and as much as a million a year to maintain. They typically contain more clinical depth and specificity than claims data, and numerous studies show the use of registries leads to improved patient outcomes.

“We don’t know how many [existing] registries are going to qualify to become these qualified clinical data registries,” says Tom Granatir, senior vice president for health policy and external relations at ABMS. “It’s going to take some time for these registries to evolve.”

Qualified clinical data registries must be in operation for at least one year to be eligible for certification by Medicare. They must include performance data from other payers beyond Medicare. Not only must QCDRs be capable of capturing and sending data, they must also provide national benchmarks to those who submit and must report back at least four times per year.

Granatir believes the QCDR rule, which allows QCDR’s to report measures beyond those included in the PQRS program, will help increase participation and will lead to more practice-based measures, but he fears it may exclude some important nuances of day-to-day patient care.

“The whole point [of quality measure reporting] is to create more public transparency…but if you have measures that are not relevant to what is actually done in practices, then it’s not a useful dataset,” he says.

Ideally, Damberg says, PQRS and other performance measures should enable physicians to do what they do better.

“I think this is really going to raise the stakes for [hospitalists] if they want to control their destiny,” Damberg says. “I think they have to get really engaged in this game and take a pro-active role in looking at where the quality gaps are and how can they better benefit patients. That’s the ultimate goal.”

Kelly April Tyrrell is a freelance writer in Wilmington, Del.

Dr. Whitcomb

The move to paying hospitals and physicians based on value instead of volume is well underway. As programs ultimately designed to offer a global payment for a population (ACOs) or an episode of care (bundled payment) expand, we are left with this paradox: How do we reward physicians for working harder and seeing more patients under a global payment system that encourages physicians and hospitals to do less?

It appears that the existing fee-for-service payment system will need to form the scaffolding of any new, value-based system. Physicians must document the services they provide, leaving a “footprint” that can be recognized and rewarded. Without a record of the volume of services, physicians will have no incentive to see more patients during times of increased demand. This is what we often experience with straight-salary arrangements—physicians question why they should work harder for no additional compensation.

Through the ACO lens, Bruce Landon, professor of health care policy at Harvard Medical School, states the challenge in a different way: “The fundamental questions become how ACOs will divide their global budgets and how their physicians and service providers will be reimbursed. Thus, this system for determining who has earned what portion of payments—keeping score—is likely to be crucially important to the success of these new models of care.”¹

In another article addressing value-based payment for physicians, Eric Stecker, MD, MPH, and Steve Schroeder, MD, argue that, due to their longevity and resilience, relative value units (RVUs), instead of physician-level capitation, straight salary, or salary with pay for performance incentives, should be the preferred mechanism to reimburse physicians based on value.²

Dr. Whitcomb

I’d like to further develop the idea of an RVU-centric approach to value-based physician reimbursement, specifically discussing the case of hospitalists.

In Table 1, I provide examples of “value-based elements” to be added to an RVU reimbursement system. I chose measures related to three hospital-based quality programs: readmission reduction, hospital-acquired conditions, and value-based purchasing; however, one could choose hospitalist-relevant quality measures from other programs, such as ACOs, meaningful use, outpatient quality reporting (for observation patients), bundled payments, or a broad range of other domains. I selected only process measures, because outcome measures such as mortality or readmission rates suffer from sample size that is too small and risk adjustment too inadequate to be applied to individual physician payment.

Drs. Stecker and Schroeder offer an observation that is especially important to hospitalists: “Although RVUs are traditionally used for episodes of care provided by individual clinicians for individual patients, activities linked to RVUs could be more broadly defined to include team-based and supervisory clinical activities as well.”² In the table, I include “multidisciplinary discharge planning rounds” as a potential measure. One can envision other team-based or supervisory activities involving hospitalists collaborating with nurses, pharmacists, or case managers working on a catheter-UTI bundle, high-risk medication counseling, or readmission risk assessment—with each activity linked to RVUs.

The implementation of an RVU system incorporating quality measures would be aided by documentation templates in the electronic medical record, similar to templates emerging for care bundles like central line blood stream infection. Value-based RVUs would have challenges, such as the need to change the measures over time and the system gaming inherent in any incentive design. Details of implementing the program would need to be worked out, such as attributing measures to individual physicians/providers or limiting to one the number of times certain measures are fulfilled per hospitalization.

Once established, a value-based RVU system could replace the complex and variable physician compensation landscape that exists today. As has always been the case, an RVU system could form the basis of a production incentive. Such a system could be implemented on existing billing software systems, would not require additional resources to administer, and is likely to find acceptance among hospitalists, because it is something most are already accustomed to.

Current efforts to pay physicians based on value are facing substantial headwinds. The Value-Based Payment Modifier has been criticized for being too complex, while the Physician Quality Reporting System, in place since 2007, has been plagued by a “dismal” adoption rate by physicians and has been noted to “reflect a vanishingly small part of professional activities in most clinical specialties.”³ The time may be right to rethink physician value-based payment and integrate it into the existing, time-honored RVU payment system.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at wfwhit@comcast.net.

References

1. Landon BE. Keeping score under a global payment system. N Engl J Med. 2012;366(5):393-395.
2. Stecker EC, Schroeder SA. Adding value to relative-value units. N Engl J Med. 2013;369(23):2176-2179.
3. Berenson RA, Kaye DR. Grading a physician’s value — the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2078.

Dr. Whitcomb

The move to paying hospitals and physicians based on value instead of volume is well underway. As programs ultimately designed to offer a global payment for a population (ACOs) or an episode of care (bundled payment) expand, we are left with this paradox: How do we reward physicians for working harder and seeing more patients under a global payment system that encourages physicians and hospitals to do less?

It appears that the existing fee-for-service payment system will need to form the scaffolding of any new, value-based system. Physicians must document the services they provide, leaving a “footprint” that can be recognized and rewarded. Without a record of the volume of services, physicians will have no incentive to see more patients during times of increased demand. This is what we often experience with straight-salary arrangements—physicians question why they should work harder for no additional compensation.

Through the ACO lens, Bruce Landon, professor of health care policy at Harvard Medical School, states the challenge in a different way: “The fundamental questions become how ACOs will divide their global budgets and how their physicians and service providers will be reimbursed. Thus, this system for determining who has earned what portion of payments—keeping score—is likely to be crucially important to the success of these new models of care.”¹

In another article addressing value-based payment for physicians, Eric Stecker, MD, MPH, and Steve Schroeder, MD, argue that, due to their longevity and resilience, relative value units (RVUs), instead of physician-level capitation, straight salary, or salary with pay for performance incentives, should be the preferred mechanism to reimburse physicians based on value.²

Dr. Whitcomb

I’d like to further develop the idea of an RVU-centric approach to value-based physician reimbursement, specifically discussing the case of hospitalists.

In Table 1, I provide examples of “value-based elements” to be added to an RVU reimbursement system. I chose measures related to three hospital-based quality programs: readmission reduction, hospital-acquired conditions, and value-based purchasing; however, one could choose hospitalist-relevant quality measures from other programs, such as ACOs, meaningful use, outpatient quality reporting (for observation patients), bundled payments, or a broad range of other domains. I selected only process measures, because outcome measures such as mortality or readmission rates suffer from sample size that is too small and risk adjustment too inadequate to be applied to individual physician payment.

Drs. Stecker and Schroeder offer an observation that is especially important to hospitalists: “Although RVUs are traditionally used for episodes of care provided by individual clinicians for individual patients, activities linked to RVUs could be more broadly defined to include team-based and supervisory clinical activities as well.”² In the table, I include “multidisciplinary discharge planning rounds” as a potential measure. One can envision other team-based or supervisory activities involving hospitalists collaborating with nurses, pharmacists, or case managers working on a catheter-UTI bundle, high-risk medication counseling, or readmission risk assessment—with each activity linked to RVUs.

The implementation of an RVU system incorporating quality measures would be aided by documentation templates in the electronic medical record, similar to templates emerging for care bundles like central line blood stream infection. Value-based RVUs would have challenges, such as the need to change the measures over time and the system gaming inherent in any incentive design. Details of implementing the program would need to be worked out, such as attributing measures to individual physicians/providers or limiting to one the number of times certain measures are fulfilled per hospitalization.

Once established, a value-based RVU system could replace the complex and variable physician compensation landscape that exists today. As has always been the case, an RVU system could form the basis of a production incentive. Such a system could be implemented on existing billing software systems, would not require additional resources to administer, and is likely to find acceptance among hospitalists, because it is something most are already accustomed to.

Current efforts to pay physicians based on value are facing substantial headwinds. The Value-Based Payment Modifier has been criticized for being too complex, while the Physician Quality Reporting System, in place since 2007, has been plagued by a “dismal” adoption rate by physicians and has been noted to “reflect a vanishingly small part of professional activities in most clinical specialties.”³ The time may be right to rethink physician value-based payment and integrate it into the existing, time-honored RVU payment system.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at wfwhit@comcast.net.

References

1. Landon BE. Keeping score under a global payment system. N Engl J Med. 2012;366(5):393-395.
2. Stecker EC, Schroeder SA. Adding value to relative-value units. N Engl J Med. 2013;369(23):2176-2179.
3. Berenson RA, Kaye DR. Grading a physician’s value — the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2078.

Dr. Whitcomb

The move to paying hospitals and physicians based on value instead of volume is well underway. As programs ultimately designed to offer a global payment for a population (ACOs) or an episode of care (bundled payment) expand, we are left with this paradox: How do we reward physicians for working harder and seeing more patients under a global payment system that encourages physicians and hospitals to do less?

It appears that the existing fee-for-service payment system will need to form the scaffolding of any new, value-based system. Physicians must document the services they provide, leaving a “footprint” that can be recognized and rewarded. Without a record of the volume of services, physicians will have no incentive to see more patients during times of increased demand. This is what we often experience with straight-salary arrangements—physicians question why they should work harder for no additional compensation.

Through the ACO lens, Bruce Landon, professor of health care policy at Harvard Medical School, states the challenge in a different way: “The fundamental questions become how ACOs will divide their global budgets and how their physicians and service providers will be reimbursed. Thus, this system for determining who has earned what portion of payments—keeping score—is likely to be crucially important to the success of these new models of care.”¹

In another article addressing value-based payment for physicians, Eric Stecker, MD, MPH, and Steve Schroeder, MD, argue that, due to their longevity and resilience, relative value units (RVUs), instead of physician-level capitation, straight salary, or salary with pay for performance incentives, should be the preferred mechanism to reimburse physicians based on value.²

Dr. Whitcomb

I’d like to further develop the idea of an RVU-centric approach to value-based physician reimbursement, specifically discussing the case of hospitalists.

In Table 1, I provide examples of “value-based elements” to be added to an RVU reimbursement system. I chose measures related to three hospital-based quality programs: readmission reduction, hospital-acquired conditions, and value-based purchasing; however, one could choose hospitalist-relevant quality measures from other programs, such as ACOs, meaningful use, outpatient quality reporting (for observation patients), bundled payments, or a broad range of other domains. I selected only process measures, because outcome measures such as mortality or readmission rates suffer from sample size that is too small and risk adjustment too inadequate to be applied to individual physician payment.

Drs. Stecker and Schroeder offer an observation that is especially important to hospitalists: “Although RVUs are traditionally used for episodes of care provided by individual clinicians for individual patients, activities linked to RVUs could be more broadly defined to include team-based and supervisory clinical activities as well.”² In the table, I include “multidisciplinary discharge planning rounds” as a potential measure. One can envision other team-based or supervisory activities involving hospitalists collaborating with nurses, pharmacists, or case managers working on a catheter-UTI bundle, high-risk medication counseling, or readmission risk assessment—with each activity linked to RVUs.

The implementation of an RVU system incorporating quality measures would be aided by documentation templates in the electronic medical record, similar to templates emerging for care bundles like central line blood stream infection. Value-based RVUs would have challenges, such as the need to change the measures over time and the system gaming inherent in any incentive design. Details of implementing the program would need to be worked out, such as attributing measures to individual physicians/providers or limiting to one the number of times certain measures are fulfilled per hospitalization.

Once established, a value-based RVU system could replace the complex and variable physician compensation landscape that exists today. As has always been the case, an RVU system could form the basis of a production incentive. Such a system could be implemented on existing billing software systems, would not require additional resources to administer, and is likely to find acceptance among hospitalists, because it is something most are already accustomed to.

Current efforts to pay physicians based on value are facing substantial headwinds. The Value-Based Payment Modifier has been criticized for being too complex, while the Physician Quality Reporting System, in place since 2007, has been plagued by a “dismal” adoption rate by physicians and has been noted to “reflect a vanishingly small part of professional activities in most clinical specialties.”³ The time may be right to rethink physician value-based payment and integrate it into the existing, time-honored RVU payment system.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at wfwhit@comcast.net.

References

1. Landon BE. Keeping score under a global payment system. N Engl J Med. 2012;366(5):393-395.
2. Stecker EC, Schroeder SA. Adding value to relative-value units. N Engl J Med. 2013;369(23):2176-2179.
3. Berenson RA, Kaye DR. Grading a physician’s value — the misapplication of performance measurement. N Engl J Med. 2013;369(22):2079-2078.

Use SHM’s CODE-H Interactive to Avoid Coding Issues

Coding is a part of every hospitalist’s life, but tips from the experts can make that life easier, more efficient, and more compliant. That’s why SHM’s CODE-H program teaches hospitalists and hospitalist group managers and administrators how to stay up to date with the latest in the best

practices of coding and documentation.

On March 20, coding expert Barbara Pierce, CCS-P, ACS-EM, will present an online session on some of the most important coding topics for hospitalists, including:

• Critical care;
• Prolonged services;
• Documentation when working with NPs and PAs;
• Teaching physician rules; and
• Tips to avoid billing issues and potential denials.

This session is the third in a series of seven that cover the full range of coding topics, from developing a compliance plan and internal auditing process to ICD-10, PQRS, and Medicare’s Physician Value-Based Payment Modifier.

CME credits are offered through post-tests following each webinar, and each participant is eligible for up to seven credits throughout the series. Up to 10 individuals in a group can sign up through a single registration.

For more information, visit www.hospitalmedicine.org/codeh.

Use SHM’s CODE-H Interactive to Avoid Coding Issues

Coding is a part of every hospitalist’s life, but tips from the experts can make that life easier, more efficient, and more compliant. That’s why SHM’s CODE-H program teaches hospitalists and hospitalist group managers and administrators how to stay up to date with the latest in the best

practices of coding and documentation.

On March 20, coding expert Barbara Pierce, CCS-P, ACS-EM, will present an online session on some of the most important coding topics for hospitalists, including:

• Critical care;
• Prolonged services;
• Documentation when working with NPs and PAs;
• Teaching physician rules; and
• Tips to avoid billing issues and potential denials.

This session is the third in a series of seven that cover the full range of coding topics, from developing a compliance plan and internal auditing process to ICD-10, PQRS, and Medicare’s Physician Value-Based Payment Modifier.

CME credits are offered through post-tests following each webinar, and each participant is eligible for up to seven credits throughout the series. Up to 10 individuals in a group can sign up through a single registration.

For more information, visit www.hospitalmedicine.org/codeh.

Use SHM’s CODE-H Interactive to Avoid Coding Issues

Coding is a part of every hospitalist’s life, but tips from the experts can make that life easier, more efficient, and more compliant. That’s why SHM’s CODE-H program teaches hospitalists and hospitalist group managers and administrators how to stay up to date with the latest in the best

practices of coding and documentation.

On March 20, coding expert Barbara Pierce, CCS-P, ACS-EM, will present an online session on some of the most important coding topics for hospitalists, including:

• Critical care;
• Prolonged services;
• Documentation when working with NPs and PAs;
• Teaching physician rules; and
• Tips to avoid billing issues and potential denials.

This session is the third in a series of seven that cover the full range of coding topics, from developing a compliance plan and internal auditing process to ICD-10, PQRS, and Medicare’s Physician Value-Based Payment Modifier.

CME credits are offered through post-tests following each webinar, and each participant is eligible for up to seven credits throughout the series. Up to 10 individuals in a group can sign up through a single registration.

For more information, visit www.hospitalmedicine.org/codeh.