Physician Compare: Changing How Healthcare Decisions Are Made

Our decisions to buy a certain product or service often are based on opinions expressed by prior purchasers.  In addition to soliciting advice from friends and family, we have at our fingertips hundreds of websites by which to access others’ opinions (and express our own opinions as well).

While other users’ subjective opinions can be helpful, knowing a product’s or service’s score on objective measures gives us greater confidence in our purchasing decisions.  Thus, we rely on publications like Consumer Reports and look for designations such as the Good Housekeeping Seal.

In selecting a healthcare provider, we first check our insurance coverage and then ask our primary care provider (if we have one), inquire about our friends’ and family members’ experiences, and surf websites like HealthGrades and Vitals, to name just two.  But when it comes to objective measures of quality, efficiency, and outcomes, the public has not had access to reliable data on which to base decisions – until now.

Introducing Physician Compare

Section 10331 of the Affordable Care Act (ACA) required the Centers for Medicare & Medicaid Services (CMS) to establish the Physician Compare website to provide consumers with objective measures of physician performance. When it was launched on December 30, 2010, Physician Compare was nothing more than a searchable list of physicians and other healthcare professionals who bill for services on the Medicare Physician Fee Schedule (MPFS).  Over the last five years, CMS has expanded the information available on the site and enhanced its functionality.

Today, Physician Compare makes available the following information for every Medicare-participating physician and healthcare professional:

  • Basic demographic information.
  • Medical school education and residency information.
  • Primary and secondary specialty.
  • Board certification (if any).
  • Practice and hospital affiliations.
  • Languages spoken.
  • Whether the provider has attested to Meaningful Use and participated in the Physician Quality Reporting System (PQRS) and the Million Hearts® initiative in the most recent year.

For a physician who is part of a group practice, one also can access a complete list of other physicians in the group by specialty.

A consumer can use Physician Compare to obtain information on his or her current physician using an individual or group name search.  One can also search for a provider within a specified radius of a city, zip code, or landmark, segregated by specialty.  The site includes a tool that allows the user to click on different areas of the body to identify the specialty he or she is seeking.

Expanding Physician Compare

The ACA required CMS to publish a plan by the end of 2013 to expand Physician Compare to include individual providers’ data on cost and quality measures.  With that plan in place, CMS is now methodically expanding the site’s functionality.

In December 2014, CMS posted the first set of quality measures on Physician Compare:  the 2013 PQRS Group Practice Reporting Option (GPRO) measures for diabetes and coronary artery disease collected via the Web Interface for 139 group practices and 237 accountable care organizations (ACOs).  CMS also posted the patient satisfaction survey scores for these ACOs.

Late last year, CMS for the first time added individual providers’ quality data, posting to Physician Compare a subset of 2014 PQRS measures collected via claims data, along with individual provider  measures from the 2014 PQRS cardiovascular prevention measures group in support of the Million Hearts® initiative.  Also in 2015, CMS added to Physician Compare a subset of the 2014 PQRS GPRO measures collected via the Web Interface for group practices of 25 or more eligible professionals, along with certain patient satisfaction scores reported by these practices.

CMS will continue to grow the amount of data available through Physician Compare, but only for those measures the agency deems statistically valid and reliable and suitable for public reporting.   CMS conducts consumer testing to identify the most appropriate measures to post on Physician Compare.  This includes having consumers evaluate the plain language measure descriptions and discussing with consumers how and if the measure would help them choose a physician.

Once CMS deems a measure appropriate for reporting, the agency then makes a formal proposal for posting on Physician Compare through the annual MPFS rulemaking process.  Stakeholders can then seek clarification and raise objections regarding the measure and/or the manner in which CMS proposes to report the data on the website.

And, as one final check before any quality data is posted on Physician Compare, there is a 30-day preview period during which a group practice or individual provider can review the data and raise any objections or concerns regarding its accuracy or the manner in which it will be reported.  CMS also posts on Physician Compare disclaimers warning consumers that a physician’s scores on quality measures do not necessarily reflect his or her skills and abilities.

MIPS and Physician Compare

Medicare’s current physician value-based purchasing programs, including PQRS, will be phased out over the next three years and replaced with the Merit-Based Incentive Payment System, or MIPS.  Beginning January 1, 2019, all MPFS payments will be subject to upward or downward adjustments, based on an individual physician’s MIPS composite score.

That composite score – expressed as a number between 1 and 100 – will be calculated using a physician’s score on specified quality measures (30% of the composite score), efficiency measures (30%), meaningful use of an electronic health record (25%), and reported clinical practice improvement activities (15%).  On an annual basis, CMS will calculate a national performance threshold.   Physicians scoring above that number will see upward adjustments to their fee schedule payments, while those with lower scores will be penalized.

The legislation creating the MIPS program, the Medicare Access and CHIP Reauthorization Act (MACRA), requires that each physician’s MIPS composite score be posted to Physician Compare, as well as the physician’s score in each of the four performance categories.  MACRA gives CMS discretion to include scores for each individual measure within each performance category.

CMS previously has indicated its desire to establish a 5-star physician rating system available to the public through Physician Compare.  Once in place, MIPS composite scores will most likely provide the basis for assigning those star ratings.  It is easy to imagine the many ways in which those star ratings will impact decisions regarding physicians, from patient choice to network eligibility.


Unlike other industries, where the quality of a product or service directly impacts a business’s bottom line, healthcare providers have been paid almost exclusively based on the quantity of services provided.  Now, with the arrival of publicly available data that allows objective, apples-to-apples comparisons, providers must identify and implement strategies and tactics to improve their scores on key measures.  Your reputation – and your reimbursement – depends on it.


Meaningful Use – Apply for Hardship Exemption to Avoid 2017 Penalties

"Carrot and stick motivation" by © Nevit Dilmen. Licensed under CC BY-SA 3.0 via Commons

Created by the American Recovery and Reinvestment Act of 2009, the Electronic Heath Record Incentive Program – commonly known as “Meaningful Use” – offered incentive payments beginning in 2011 for eligible physicians who attested to meaningful use of an EHR, as defined by regulations.  Those carrots, however, soon turned into sticks.

An eligible physician who did not attest to meaningful use or receive a hardship exception for 2013 saw a 1% penalty on 2015 Medicare Physician Fee Schedule payments.  Those who failed to attest or receive a hardship exception for 2014 will be penalized 2% in 2016.

To avoid the 3% penalty in 2017, eligible physicians must attest to having met the Modified Stage 2 Meaningful Use requirements for 90 consecutive days during calendar year 2015.  However, CMS did not finalize those requirements until October 16, 2015, meaning that physicians did not have notice of the revised program requirements until less than 90 days remained in the calendar year.

CMS stated that it would grant hardship exemptions to those eligible providers unable to attest due to the lack of timely notice.  However, to secure such an exemption, a provider would have to submit a detailed application with supporting documentation, which CMS would review and approve on a case-by-case basis.  Thus, it appeared nearly all physicians would face Meaningful Use penalties in 2017.

This situation was avoided, however, when the President signed the Patient Access and Medicare Protection Act into law December 28, 2015.  The new law allows CMS to grant blanket hardship exemptions to physicians who apply by March 15, 2016.  After that date, a physician still may apply for exemption through July 1, 2016, but such application will be subject to case-by-case review by CMS.  A physician who receives an exemption will not be subject to the 3% penalty in 2017.

CMS has not yet posted to its EHR Incentive Program website instructions on how to apply for a 2015 hardship exemption.  Once CMS makes this information available, a physician should submit his or her hardship exemption application as soon as possible, unless he or she can attest to having met the applicable Meaningful Use requirements in 2015.

As CMS’ Acting Administrator Andy Slavitt stated publicly January 11, Meaningful Use as we know it will come to an end in 2016, with the last physician penalties to be assessed in 2018.  In its place, the Merit-Based Incentive Payment System (MIPS), Medicare’s new physician value-based purchasing program, will go into effect January 1, 2019.

Under MIPS, each provider receiving payment under the Medicare Physician Fee Schedule will be assigned a composite score of 1 to 100 based on four categories of performance measures:  quality (30% of the composite score), efficiency (30%), meaningful use of an EHR (25%), and clinical practice improvement activities (15%).  Physicians with higher scores will receive bonus payments, while those with lower scores will be subject to penalties.

CMS now is beginning the process of identifying the specific measures to be incorporated into each MIPS category, including meaningful use of an EHR.  Expect those requirements to be consistent with the Stage 3 Meaningful Use requirements which were published at the same time as the Modified Stage 2 requirements.  For now, however, stay on target to meet the Modified Stage 2 Meaningful Use requirements for 2016 to avoid the 3% penalty in 2018.

Advance Care Planning: Who, What, When, Where, and How

Effective January 1, 2016, Medicare now pays physicians and non-physician practitioners for time spent providing face-to-face advance care planning (ACP).

ACP Graphic*From the CPT Coding Manual

For the sake of comparison, payment for ACP is about 20% less than payment for a level-4 established patient office visit (CPT code 99214), which requires 25 minutes of face-to-face time with the patient, if coded based on time.

In the 2016 Medicare Physician Fee Schedule Final Rule, CMS gave the following directions on providing and billing for ACP, while also promising to publish additional sub-regulatory guidance in the near future:


  • Primary care physicians and specialists may bill for ACP. Unlike transitional care management (TCM) (CPT codes 99495 and 99496) or chronic care management (CCM) (CPT code 99490), more than one provider may bill for ACP furnished to the same patient during the same time period.
  • ACP may be billed by physicians and non-physician practitioners (NPP) only. However, ACP may be furnished incident to the services of the billing physician or NPP, meaning other clinical staff may perform the service under the direct supervision of the physician or NPP.  All requirements for “incident to” billing must be met, and the clinical staff providing the service must be qualified under state licensure laws.
  • ACP is a stand-alone billable visit in a rural health clinic (RHC) or Federally Qualified Health Center (FQHC), when furnished by an RHC or FQHC practitioner and if all other program requirements are met. However, if ACP is furnished on the same day as another billable visit at an RHC or FQHC, only one visit will be paid.


  • Completion of relevant legal forms is not a required element of ACP. However, time spent reviewing and discussing advance directives is included in the service.  The CPT manual defines an advance directive as “a document appointing an agent and/or recording the wishes of a patient pertaining to his/her medical treatment at a future time should he/she lack decisional capacity at that time.”  This includes, for example, a healthcare proxy, durable power of attorney for healthcare, living will, and medical orders for life-sustaining treatment.
  • While CMS will evaluate whether a national coverage determination should be developed for ACP, for the time being, the Medicare Administrative Contractors (known as MACs) will be responsible for local coverage decisions.


  • CPT code 99497 may be billed for the first 30 minutes of services on a given day, and CPT code 99498 may be billed for each additional30 minutes of service performed on the same day, with no limit.  For example, for a meeting lasting an hour-and-a-half, a physician would bill one unit of 99497 and two units of 99498. There are no frequency limitations to these codes, so they may be used as often as the need arises.
  • The ACP codes also may be billed on the same day as most other inpatient and outpatient evaluation and management (E/M) codes, provided that the time counted to bill the ACP codes is only counted for ACP services, and not also used to meet time-based criteria for an E/M code.
  • A physician or NPP may bill for ACP furnished during the same time period the physician or NPP is providing TCM or CCM.
  • ACP may be furnished in conjunction with a Welcome to Medicare visit or an annual wellness visit. In these instances, Medicare provides first-dollar coverage for the service (when billed with modifier -33).  In all other instances, ACP is subject to cost-sharing requirements.


  • Presently, ACP is not reimbursable if furnished via telehealth.


  • There are no specific performance standards, special training, or quality measures a physician or NPP must satisfy to bill for ACP.
  • Unlike chronic care management, the physician or NPP is not required to obtain the patient’s written consent to bill for ACP. Although not required, CMS encourages providers to inform patients of applicable cost-sharing requirements.
  • Because ACP is a time-based code, the documentation must include the total amount of time spent face-to-face with the patient, family members, and/or surrogate. For auditing purposes, start and stop times are the preferred – but not required – method of documentation.

PYA can assist your organization in developing and implementing a successful and compliant ACP program.  For more information, contact Lori Foley ( or Martie Ross ( at PYA, (888) 420-9876.

Seeing Stars: Updates to the Physician Compare and Hospital Compare Websites

Dog SunglassesOn December 10, the Centers for Medicare & Medicaid Services (CMS) added new quality data to the Physician Compare and Hospital Compare websites. Both websites allow healthcare consumers – both patients and health plans – to compare providers’ performance on objective quality measures.

While not there yet, CMS intends to make the two websites as user-friendly as the Star Rating System for Medicare Advantage and Prescription Drug Plans.  And, in the case of Physician Compare, the implementation of the physician Merit-Based Incentive Payment System over the next three years will deliver a wealth of new data with which consumers can compare providers.

Physician Compare

Until last year, the data available on Physician Compare was limited to basic contact information.  In February 2014, CMS included the first quality measures for group practices.  Now, CMS has significantly expanded the list of measures and – for the first time – included a subset of quality measures for individual healthcare professionals.  Also, measures for Shared Savings Program and Pioneer ACOs now are available on Physician Compare.

To make the information user-friendly for consumers, performance scores on each measure for group practices and individual providers are displayed as stars, with each star representing 20%. If, for example, a group practice scores 80% on a measure, four fully-filled stars would be displayed.

For now, these stars do not represent a rating or ranking system because they do not serve to benchmark or compare providers against one another.  And, for now, the website does not allow a beneficiary to make a side-by-side comparison of providers based on performance scores.  CMS, however, intends to add benchmarking and performance-score comparisons to Physician Compare by 2017.

Hospital Compare

Today, Hospital Compare includes information on more than 100 quality measures and over 4,000 hospitals.  These include individual hospital’s scores on the Medicare hospital readmission reduction program, the value-based purchasing program, and hospital-acquired condition reduction program.

Hospital Compare also includes hospital star ratings based on patient satisfaction survey scores.  A beneficiary can compare one hospital against another with regard to measures such as communication with physicians and nursing staff, effective pain control, and cleanliness.  CMS now is working to expand the hospital star ratings to include other key performance measures.

If the Medicare Advantage star rating system is any indication, a provider’s rating will have a significant impact on beneficiary decision-making.   In 2015, 61% of Medicare Advantage beneficiaries selected a 4-star or higher plan, up from 23% in 2010.  Providers, therefore, should stay abreast of CMS’ plans to make more performance scores publicly available and to benchmark providers’ performance against each other.

More importantly, providers should be identifying and pursuing opportunities for improvement in their performance scores.  In the very near future, these scores will be a key factor in determining market share, as more healthcare consumers – patients and health plans – come to rely on comparative ratings to make buying decisions.

Be Prepared for the Impact of the Bipartisan Budget Act on Provider-Based Reimbursement

It seems there’s always a surprise for healthcare providers hidden in the now-routine, end-of-the-year budget deals to avert a government shutdown.  This year, it’s Section 603 of the Bipartisan Budget Act of 2015, signed into law by President Obama November 2. 

Here’s the short of it: Services furnished in any off-campus outpatient hospital department (other than a dedicated emergency department) established after November 2 will be paid at Medicare Physician Fee Schedule (MPFS) or Ambulatory Surgery Center (ASC) rates beginning January 1, 2017.  Those departments established prior to that date (as well as all on-campus departments, regardless of when established) will continue to be paid under the Outpatient Prospective Payment System (OPPS). 

And here are just some of the questions the Centers for Medicare & Medicaid Services (CMS) will have to answer when it promulgates implementing regulations:  (1) How will CMS distinguish between claims for services furnished in a pre-11/02/15 department and those furnished in a post-11/02/15 department?  (2) If a hospital has an existing physician practice location billed as a hospital outpatient department, what happens if it adds more providers at that location?  Is the answer different if new providers are replacing departing providers?  (3) What happens if a hospital expands the scope of services offered at an existing location, e.g., installs new diagnostic testing equipment or begins performing new surgical procedures?

We anticipate CMS will begin answering these questions when it publishes the 2017 Hospital Outpatient Prospective Payment System proposed rule in the summer of 2016.  (Then again, the agency may elect to publish a separate proposed rule on this specific matter earlier in the year.)  Until we have those answers, however, hospitals are stuck in limbo.

 Many hospital acquisitions and construction and expansion projects depend on provider-based reimbursement to make financial sense. Depending on how CMS interprets Section 603, many of these deals could be dead on arrival.  Over the next year, hospitals must factor this risk into their analysis of any proposed deal or expansion project.  At PYA, we now are building these factors into financial modeling performed for our clients.    

Also, now that Congress has taken the first step to close the gap between hospital and non-hospital reimbursement rates, no one should be surprised to see similar measures tucked into upcoming legislation.  Section 603 may very well be the first tree to fall in a changing healthcare landscape.  Thus, our strategic planning team now takes a longer look at the impact of changing fee-for-service reimbursement, as well as new value-based payment models.

What Is Population Health, Anyway? – Part V: A 10-Part Plan of Attack for Population Health

A Five-Part Series
Part V: A 10-Part Plan of Attack for Population Health

In our earlier blog entry, we posited that the term “population health” is rather meaningless unless stated in terms of how it is implemented, which involves the application of the clinical, organizational, and technical aspects of population health management.  We previously examined the clinical aspect, the organizational aspect, and the technical aspect.       

Having identified the three aspects of population health, thought leaders within the Organizational Hub can then define the concept of population health for their own population through the strategies and tactics they develop to improve the status of health for that population.  The question then becomes: what constitutes a viable, common-sense population health management program? 

Let’s revisit the notion that population health management is key to thriving and surviving in the new world of healthcare payment and delivery.  Value will be rewarded over volume, and new methods will need to be adopted to promote wellness for the population served.  Value will be determined using increasingly more precise metrics gauging patient satisfaction and outcomes.  Strategies will be aimed at the entire population served while individual needs within that population will continue to be addressed.

Let’s also accept the fact that the hospital and its medical staff must be the initiators of action. They must be harnessed together, developing administrative and clinical capabilities concurrently to manage population health.  They must bring together other community services and resources that impact the social determinants of health and serve as the Organizational Hub for community action.

Given that starting point, the Organizational Hub should consider the following plan of attack:

1.       Create the trust environment within which hospital administrative leaders and physician leaders can begin to develop a common understanding of the urgency of preparing the organization to move from volume to value, recognizing the compelling need to design processes that produce value, and immediately undertake the task of reforming their mutual business and clinical operations to succeed in a rapidly changing healthcare environment.

2.       Identify the population served: i.e., identify the community which comprises the population to be addressed by a planning process. 

3.       Conduct a comprehensive Community Health Needs Assessment (CHNA) which engages every entity in the community that has an impact on the social determinants of health for the residents of the community.  Engage those constituent organizations in an honest evaluation of the community’s population health status and a detailed planning process designed to address areas of concern in a deliberate and organized way. The CHNA must identify the sources of relevant clinical, demographic, and financial data associated with that population; the resources available to attempt to address population health needs; and the gaps in capabilities and resources needed to impact population health.

4.       Invest in diverse, patient-oriented access to facilities and IT infrastructure. Facilities should be designed to provide convenient care sites for patients and capabilities for outpatient, office-oriented care.  At a minimum, the IT system should be able to perform network-wide scheduling, provide patients with a portal to their own healthcare information, provide a patient-friendly means of communication with providers, and provide a virtual care interface for providers within the network. 

5.       Perform data analysis that is aimed at identifying care gaps.   By integrating evidence-based medicine best practices garnered from national and local sources with the organization’s claims data and clinical data for chronic disease states, care gaps for individual patients and the population as a whole can be identified.  Clinical data will show what clinical plan was pursued.  Claims data will show what actually was done and the effectiveness of the care rendered.

6.       Stratify patients into risk groups.  Using data analytics, patients can be sorted into three risk groups: healthy, intermediate or rising risk, and high risk.  Resources can then be allocated toward the groups in ways that yield the greatest return on investment.  For instance, strategies advocating exercise and healthy eating can be implemented at low cost and have general application across all three groups.  Strategies designed to keep patients in the rising-risk category from moving to the higher-risk category should perhaps receive the most attention because of the higher return on investment that can be realized.  By taking advantage of new Medicare payment codes to pay for chronic care management, providers can now receive compensation for more proactive management of high-risk, high-cost patients.

7.       Engage and activate patients within the population to take responsibility for their own health.  The Patient Activation Measure, developed by Judith Hibbard, and the 43 engagement behaviors, identified by Jesse Gruman of the Center for Advancing Heath, is an excellent tool for engaging the population.  The effort must be aimed at both the population level (to address the community social determinants of health) as well as at the specific patient level (engaging the patient in decisions and habits that impact their personal health status). 

8.       Place in motion a continually evolving and dynamic plan that incrementally begins to manage care for the population.  It should contemplate a team approach, led by the Organizational Hub, but employ the skills and resources of all the assets of the community in which the population resides.  Care must be coordinated across the continuum of care, specialized for the patients based upon the stratification of risk groups.  The healthy group should receive wellness and prevention programs; the rising-risk group will need frequent screening for the condition for which they are at risk and interventions to encourage lifestyle changes, and the high-risk group will need care strategies to prevent further complications of their disease or diseases (as is frequently the case).

9.       Consider an investment in a lean, scalable care team that can expand the physician staff’s capabilities to effect population health management and allow practitioners to practice at the top of their respective licenses, doing what they presumably like doing best. 

Strategically deployed advanced practitioners can greatly improve patient interaction and relieve physicians of time commitments. An expanded role for pharmacists can accelerate access to care, monitor medication therapy management, and prevent readmissions to the hospital.  Robust extended-care resource teams can provide the necessary patient monitoring and interaction to effect lifestyle change and assure patient compliance with care plans.  The care team can be empowered to care, communicate, and coordinate – all keys to managing care.  An integrated behavioral health function can have dramatic impact on patients’ compliance with care plans and significantly assist patients with co-morbidities.

10.   Measure and compare outcomes with baseline data to demonstrate progress and success.  The basic IT system used will need the capability to identify clinical processes, care outcomes, cost of care, and patient satisfaction scores.  A system of continual process improvement will need to be implemented wherein the outcomes measured can identify areas that are capable of improvement so that the planning team can address those gaps and continue to advance capability and improve process.  

Ultimately, population health is defined by the healthcare executives, clinicians, community stakeholders, and individuals comprising the population in question.  The definition emerges from the process of harmonizing the views and talents of those seeking to positively impact the population’s health status.  Each aspect of population health identified above – clinical, organizational, and technical – must be uniquely adapted to address the multiple needs of the defined population and the complexity of environmental factors within its community.

What Is Population Health, Anyway? – Part IV: Technical Aspect

A Five-Part Series
Part IV: Technical Aspect

In our earlier blog entry, we posited that the term “population health” is rather meaningless unless stated in terms of how it is implemented, which involves the application of the clinical, organizational, and technical aspects of population health management.  We previously examined the clinical aspect and the organizational aspect; finally, we focus on the technical aspect.    

Health information technology provides the foundational support for the workflow and process changes necessary for effective population health management.  Those changes ultimately will foster the strong healthcare relationships needed to implement organized systems of care; coordinate care across multidisciplinary teams and settings; enhance access to primary care; centralize resource planning; provide continuous care either in, or outside of, office visits; promote patient self-management education and healthy behavior and lifestyle changes; and facilitate essential communication among providers and patients.

The Agency for Healthcare Research and Quality has identified five domains of health information system functionalities to support population health management:

  • Domain 1:  Identify subpopulations of patients who require preventive care or tests.
  • Domain 2:  Examine detailed characteristics of identified subpopulations.
  • Domain 3:  Create reminders for patients and providers to make information actionable.
  • Domain 4:  Track performance measures in real time to compare care delivered to national guidelines.
  • Domain 5:  Make data available in multiple forms (e.g., printed, exported, or graphically displayed).

Presently, there is a significant gap between existing and optimal functionality for population health management.  Progress is being made, but the lack of cost-effective health information technology solutions remains a major impediment to fully integrated population health strategies. 

Providers are particularly challenged when selecting and implementing technology solutions.  Many have adopted EHRs, but that is only the first step.  A wide range of other applications will be required to implement the functionalities identified above.  Further, systems must be adaptable to a rapidly changing payment and regulatory environment and the light-speed change of technology itself. 

The Accelerating Pace of Technological Development.  Emerging daily are cutting edge applications that are making the initial iteration of health information exchange obsolete.  No longer must providers query raw form records from individual episodes of patient/provider interaction in order to get the actionable data they need for the specific analysis they are conducting. Selective data extraction from multiple patient records and collation of that specific information for more efficient analysis is becoming feasible.

Increasingly, healthcare executives are looking beyond the vendors who supply their core financial and clinical information systems for the IT capabilities needed for population health management.   The more specialized, creative technology developers are capturing a larger portion of the population health management space.

As a result of the dynamics inherent in identifying and deploying IT solutions to support population heath management, healthcare executives are understandably moving cautiously – developing their population health strategy, identifying gaps in IT needs to support it, and addressing the urgent IT needs such as automated patient outreach capabilities and patient communication.   But they are keeping their options open when considering the more complex analytical applications that will ultimately be required for the development of more comprehensive strategies to address population health needs and effectively manage patient stratification—those actions that truly move the needle in improving population health status. 

Impact of Disruptive Technology. The IT space is being further complicated by the proliferation of disruptive technologies that are likely to cause fundamental changes in access to, and delivery of, healthcare.  Consider smart phone applications that harness the device’s capabilities—computing power, camera, audio, video, motion sensor, and GPS—in new ways to manage health and wellness.  There are fitness and weight control apps, exercise programs and progress monitoring apps, apps to monitor glucose for diabetics, heart rate and blood pressure apps, sleep hygiene apps, and stress reduction apps, just to name a few.

What happens when all the data such devices produce find their way into the medical record?  How will data be used productively and applied to benefit the patient?  How might that information be used to impact population health management?  How will providers cope with the influx of information and effectively deal with it? What apps are being developed daily that could come online virtually overnight and will totally disrupt how healthcare is monitored and delivered?

It’s somewhat terrifying to realize these rhetorical questions are already being answered.  Creative digital geniuses can use established technology systems to tinker freely with ideas and develop and market new applications with no investment other than their time.  Digital disruption is not only reducing the barriers of entry into the market, it is obliterating them.  Development of technological solutions that used to take years from development to market can now be done in days.  Large IT investments can be rendered obsolete overnight. 

Rapid Change – Challenges and Opportunities.  So how do leaders contend with the volatile environment of such a key component of the organization’s population health narrative?  First, management must obviously be prudent in making any large investment in IT.  Having the ability to meet immediate needs while remaining nimble enough to capitalize on new and emerging technology that dramatically enhances capabilities is a prudent planning strategy, as we noted above. 

Second, perhaps the challenge can, and should be, recognized as an opportunity.  Digital innovators are having a hard time maximizing the potential that comes from their efforts and creativity.  They need some connection to healthcare providers who can channel that power productively.  We often encounter digital developers who have a nifty new application, but who have no appreciation of how that application can really be used to impact the healthcare environment. 

Those well-meant efforts would be better channeled were there better communication between digital developers and healthcare leaders grappling with the complexity of population health efforts.  Grasping that opportunity, healthcare leaders may be able to dramatically cut their IT investment with technology solutions tailored to their specific needs.  Really strong solutions could be marketed to others, perhaps creating a whole new source of revenue for the healthcare organization.

The potential benefits from the use of digital technology are illustrated by a recent longitudinal study by the Veteran’s Health Administration (VHA).  The VHA has been using a wide variety of technology, including videophones, messaging devices, biometric devices, digital cameras, and telemonitoring devices in its home telehealth program since 2003. 

A retrospective analysis of VHA data from 2009 through 2012 found that VHA’s routine use of such digital technology has been successful in coordinating care and more efficiently managing patients with complex chronic conditions. For example, after 12 months of home telehealth (non-institutional care) the mean annual healthcare costs for VHA home telehealth patients fell 4%, while the corresponding costs in a matched cohort group increased 48%.

Without harnessing the power of technology, the reach of population health management will be severely limited, extending only so far as an individual physician’s working knowledge of his or her patients’ medical conditions and social circumstances.  Properly aligned with the clinical and organizational aspects, technology is the key to unlock the potential of population health management.


Next up:

A 10-Part Plan of Attack for Population Health

No Fooling: Mandatory Medicare Bundled Payments for Hip and Knee Replacements Start April 1

On November 16, the Centers for Medicare & Medicaid Services (CMS) released its 1000-page final rule implementing its Comprehensive Care for Joint Replacement payment model, or CCJR.   Beginning April 1, 2016 (three months later than the originally proposed start date of January 1), CMS will bundle payments for nearly all Part A and B services related to hip and knee replacement surgeries performed at hospitals located in 67 selected metropolitan statistical areas (MSAs).

Over much objection, CMS is moving forward with converting what is now a voluntary payment model—Bundled Payment for Care Improvement (BPCI)—into a regulatory mandate.  CMS anticipates saving $343 million—or 2.8% of the $12.299 billion it expects to spend on hip and knee replacements over the five-year course of the program. 

Back in July, when CMS introduced the proposed payment model, we summarized CCJR’s key provisions in a Q&A format.  We now have updated those answers (and added a few more) based on the final rule and related CMS commentary.   

What services are included and bundled for a CCJR episode of care?

A CCJR episode will start on the day a traditional Medicare beneficiary is admitted for hip or knee replacement surgery (limited to MS-DRGs 469 and 470), and will continue for 90 days following the beneficiary’s discharge from the hospital.  The episode includes all Part A and Part B services furnished to the beneficiary during this period with the exception of a specific list of services CMS has deemed clinically unrelated to these episodes.  CMS will update the list, found at 42 CFR 510.200(d), on an annual basis.

Which providers are subject to CCJR?

Any hospital located in one of the 67 selected MSAs that bills traditional Medicare for a hip or knee replacement surgery is subject to CCJR. (Maryland hospitals and other hospitals now participating in a risk-bearing phase of BPCI Model 2 or 4 for lower extremity joint replacements are excluded from CCJR.) 

CMS had proposed including 75 MSAs, but eliminated 8 of them because they no longer met the eligibility criteria.  Hospitals in the following MSAs can decide whether they dodged a bullet or missed out on an opportunity:  Las Vegas, NV; Richmond, VA; Virginia Beach, VA; Fort Collins, CO; Colorado Springs, CO; Evansville, IN; Medford, OR; and Rockford, IL.        

Hospitals in the 67 selected MSAs will bear the financial risk for the total cost of care furnished by all providers for the included episodes of care.  The hospital and these individual providers (e.g., physicians, long-term care hospitals, skilled nursing facilities (SNFs), home health agencies, ambulance services) will continue to submit, and CMS will continue to pay, claims for services furnished during a covered episode of care.   

On an annual basis, CMS will compare the actual total cost of care for all episodes provided at a hospital to that hospital’s predetermined episode target price.  If the actual cost is less than the target price, the hospital will receive a reconciliation payment equal to the difference, provided the hospital has met certain performance standards. 

If, however, the actual cost is more than the target price, the hospital will be required to pay the difference to CMS (with the exception of Year 1, as described further below), subject to a cap to protect hospitals from what CMS characterizes as “excessive risk.” 

Because a hospital already receives a flat amount for its services within the episode of care – its DRG payment – its opportunity/risk is, for the most part, based on the performance of other providers furnishing care during the episode.  CMS is incentivizing hospitals to assume the “captain-of-the-ship” role and aggressively manage the entire episode of care.   

How will CMS calculate the target pricing? 

CMS will calculate each hospital’s benchmark price annually based on 3 years of historical data updated every other year:   performance Years 1 and 2 will use historical CCJR episodes that started between January 1, 2012, and December 31, 2014; performance Years 3 and 4 will use historical episodes that started between January 1, 2014, and December 31, 2016; and performance Year 5 will use episodes that started between January 1, 2016, and December 31, 2018.

In Years 1 and 2, the formula will be based two-thirds on hospital-specific data and one-third on regional data.  (CMS will calculate cost data for 9 different geographic regions.) In Year 3, the formula flips: the benchmark price will be calculated weighting one-third of the price on hospital-specific data and two-thirds of the target price on regional data.  In Years 4 and 5, the benchmark price will be based exclusively on regional data.  The formula also makes certain adjustments for low-volume hospitals and high episode spending. 

The most significant difference between the proposed and final rules is the discount rate used to adjust the benchmark price to arrive at the target price.  Under the proposed rule, CMS would have set each hospital’s target price by applying a fixed, standard discount rate to the benchmark price to account for Medicare’s share of reduced expenditures. 

CMS had proposed a discount rate of 1.7% for hospitals that successfully submitted patient-reported outcomes data for at least 80% of eligible patients for that performance year.  Non-reporting hospitals would have been subject to a 2% discount rate.  Remember, the lower the target price, the harder it is to earn a reconciliation payment (or avoid a repayment liability). 

That would have been simple, but CMS opted for an alternative, composite quality score (CQS) methodology “to provide stronger incentives for more hospitals to improve quality.”  A hospital’s annual CQS will determine its discount rate (higher CQS = lower discount rate), meaning top-performing hospitals will have higher target prices than poor-performing hospitals.

CMS published 22 pages of supplemental information describing the manner in which the CQS will be calculated for each hospital for each year of the program.  (Trust us:  this publication is much easier to navigate than the 80+ pages devoted to the subject in the final rule.) 

The CQS will be based on two measures:  (1) hospital-level risk-standardized complication rate following elective primary total hip arthroplasty (THA) and/or total knee arthroplasty (TKA) (NQF #1550); and (2) Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey measure (NQF #0166).  The relevant performance periods are as follows:

Highly simplified, a hospital’s CQS will be based on its performance percentile relative to the national distribution of all hospitals’ performance on the two measures, as well as the hospital’s year-to-year improvement on its scores.  Also, a hospital will have the opportunity to improve its CQS (i.e., earn extra credit) by voluntarily submitting to CMS patient-reported outcomes and risk-variable data associated with primary elective THA/TKA procedures.

Once the CQS has been calculated, CMS will use the following tables to determine the discount rate for purposes of calculating the reconciliation payment or repayment amount.  CMS then will communicate these target prices to each hospital prior to the beginning of the performance year.

Recognizing that many CCJR hospitals will need time to analyze data and establish relationships with episode providers, there will be no downside risk in Year 1 (April 1 to December 31, 2016).  Hospitals still will be eligible for reconciliation payments in Year 1 (and each year thereafter) if (1) the hospital has a positive net payment reconciliation amount (NPRA) (i.e.,  the actual adjusted  episode payments are less than  the episode target price; and (2) the hospital’s CQS is at least “acceptable.”   

Under the proposed rule, CMS only considered a hospital’s performance on quality measures to determine whether it was eligible for a reconciliation payment.  With the final rule, CMS now considers such performance in determining the dollar amount of a hospital’s reconciliation payment or repayment obligation.  A hospital that achieves a high quality score will owe less in repayment than if it was a poor performer. 

Also new in the final rule is a provision authorizing CMS to withhold or recover any reconciliation payment if the agency should determine the savings were realized through “inappropriate and systematic underdelivery of care.”





To what degree of financial risk is a hospital exposed?

Repayments are capped at 5% of the applicable target episode price in Year 2, 10% in Year 3, and 20% in Years 4 and 5.  (In the proposed rules, these percentages had been 10% in Year 2 and 20% thereafter).  For example, if a hospital’s target episode price was $10,000 and there were 100 episodes per year, the hospital’s potential liability would be limited to $50,000 in Year 2, $100,000 in Year 3, and $200,000 in Years 4 and 5.  A lower stop-loss limit applies to rural hospitals, sole community hospitals, Medicare- dependent hospitals, and rural referral centers.

On the other end of the spectrum, CMS has imposed the following limits on reconciliation payments:  5% of the applicable target episode price in Years 1 and 2, 10% in Year 3, and 20% in Years 4 and 5.     

What options are available to a CCJR hospital to manage this risk?


CMS intends to make reconciliation payments to, and require repayments from, hospitals only; the agency does not propose to hold other providers financially responsible.  Instead, CMS expects hospitals to engage other providers to manage these episodes of care efficiently.

Prior to the April 1 start date, CMS will provide CCJR hospitals, upon request, up to 3 years of retrospective claims data, including both summary and raw claims-level data and quarterly updates thereafter.   Hospitals will be required to sign an appropriate data use agreement to receive this data.  This data will help the hospital identify specific opportunities to partner with other providers to drive down the total cost of care. 

CMS encourages hospitals to enter into what it refers to as CCJR sharing arrangements with CCJR collaborators (including physicians and non-physician practitioners, skilled nursing facilities, long-term care hospitals, inpatient rehabilitation facilities, home health agencies, and outpatient therapy providers).  Under such a written contract, the CCJR collaborator would agree to participate in specific quality and efficiency initiatives relating to the episodes in exchange for “gainsharing payments,” i.e., the hospital’s agreement to share a portion of any reconciliation payment and/or a portion of the hospital’s internal cost savings generated through such initiatives. A CCJR collaborator also may agree to pay the hospital an “alignment payment,” i.e., a portion of any repayment the hospital owes to CMS.

Under the final rule, a hospital is required to develop and maintain written policies regarding its selection of CCJR collaborators, including quality-related criteria to evaluate potential candidates.  The hospital must maintain on its website a complete list of current and historical CCJR collaborators. 

The regulations include several specifications for CCJR gainsharing arrangements, including quality performance requirements, caps on gainsharing and alignment payments, the timing of such payments, and detailed recordkeeping requirements.   Also, CMS uses a narrow definition of internal cost savings for purposes of gainsharing payments.  Any such payments are limited to the hospital’s measurable, actual, and verifiable cost savings resulting from care redesign undertaken by the hospital in connection with the CCJR episodes.  

 What opportunities does a CCJR hospital have to pursue care redesign?

To afford CCJR hospitals greater flexibility in pursuing care redesign, CMS has exercised its statutory authority to vary specific payment rules as necessary to implement alternative payment models.  Specifically, CMS has approved the following:      

  1. A waiver of the requirement for a 3-day inpatient hospital stay prior to admission for a covered SNF stay under specific conditions detailed in the regulations.
  2. Allowing payment for telehealth services furnished to the patient in his or her home, regardless of whether the beneficiary resides in a rural or urban area.   
  3. Allowing payment for up to 9 home visits by licensed clinical staff for non-homebound beneficiaries (i.e., requiring only general supervision under the “incident to” rules).

Additionally, CMS and the Office of Inspector General (OIG) published a joint notice on November 16 regarding waiver of certain fraud and abuse laws in connection with CCJR.  The waivers are narrow, especially as compared to those afforded to participants in the Medicare Shared Savings Program.  They relate only to (1) distribution of gainsharing payments and payment of alignment payments under sharing arrangements; (2) distribution payments from a physician group practice to a practice collaboration agent; and (3) patient engagement incentives provided by participant hospitals to Medicare beneficiaries in episodes.  Each waiver has several specific requirements, all of which must be satisfied for a provider to enjoy its protections. 

How will CCJR impact Medicare beneficiaries?

CCJR hospitals must notify beneficiaries of the model’s requirements at the time of admission in the manner specified by CMS.  Hospitals also must require as a condition of any sharing arrangement that the collaborators notify beneficiaries of the existence of a sharing arrangement.  In the case of physicians, this notification must occur at the point of the decision to proceed to surgery, or, in the case of other collaborators, prior to the furnishing of the first joint-replacement-related service provided by the collaborator. Also, as part of discharge planning, CCJR hospitals must inform beneficiaries of all Medicare-participating PAC providers/suppliers in an area but may identify those providers/suppliers that the hospital considers to be preferred.

So now what?

For hospitals, orthopedic surgeons, and post-acute care providers in the selected 67 markets, now is the time to start unpacking the details of the CCJR program.  Hospital leaders should become educated regarding program requirements. These leaders, in turn, should invite potential CCJR collaborators into conversations regarding the program, thus beginning to build the trust relationships that will be key to success.   

Hospitals also should bring laser-beam focus to improving performance on CCJR’s two quality performance measures.  A hospital’s CQS, which is based on these measures, determines eligibility for any reconciliation payment and can vary the amount owing to or owed by the hospital by 1.5 percentage points. 

To prepare for CCJR’s launch in April 2016, providers should begin compiling and analyzing available data regarding CCJR episodes to identify potential cost savings opportunities.  Once CMS makes historical claims data available to individual hospitals, these opportunities will come into clearer focus.

PYA has extensive experience supporting providers participating in CCJR’s older sibling, BPCI, both with technical compliance and development and implementation of care redesign plans.  PYA can partner with your organization to develop and implement a successful CCJR strategy.

  • PYA offers interactive educational opportunities for leadership teams to understand the details of the CCJR program and its impact on the organization.
  • PYA’s performance improvement experts can identify and support implementation of strategies to improve key quality scores.
  • PYA can assist a hospital with developing and implementing processes to ensure full compliance with CCJR regulatory requirements.
  • PYA Analytics’ computational scientists have deep and wide experience extracting knowledge from CMS claims data, including opportunities for greater efficiency and cost savings.
  • Drawing on its extensive experience in the development and operation of clinically integrated networks and clinical co-management and gainsharing arrangements, PYA can facilitate communications between a hospital and potential CCJR collaboratives, and support development of mutual strategies for success.
  • PYA provides financial modeling to help an organization understand and respond to the potential financial impact of CCJR. 

For additional information, please contact David McMillan or Martie Ross at (800) 270-9629.  

What Is Population Health, Anyway? – Part III: Organizational Aspect

A Five-Part Series
Part III: Organizational Aspect

In our earlier blog entry, we posited that the term “population health” is rather meaningless unless stated in terms of how it is implemented, which involves the application of the clinical, organizational, and technical aspects of population health management. We previously examined the clinical aspect; now, we focus on the organizational aspect.   

To accomplish the herculean task that lies before core hospital/physician teams as integrators and their broader resource teams of community experts, organizational functionality and discipline are essential. If the goals of the “Triple Aim” are to be realized, the process to be undertaken must result in complete culture change, refocusing the entire enterprise on population health improvement.

Consider that the hospital has thrived on a fee-for-service payment system that relies on the hospital being filled to capacity with its medical staff optimizing the use of its beds, ORs, laboratory, and imaging capabilities. The medical staff members have functioned in silos of specialties, increasing their revenues by the number of times they tested or touched the patient. Both the hospital and its physician staff have been motivated by helping patients with each isolated healthcare issue, a specific episode of illness or injury. Neither has been incentivized to collaborate to achieve better health status outcomes more efficiently.

Now consider that both the hospital and physician staff will be rewarded in the future if they demonstrate patient satisfaction scores superior to their competitors and health outcomes that actually keep people out of the hospital’s expensive confines. In this zero-sum reimbursement environment, those who fail to compare favorably will be penalized financially. The funds realized from the penalties assessed will be used to reward those achieving the superior results. 

In addition, metrics have been developed and the analytics capability established that will allow comparisons to be made and published. The results will become public knowledge (read: transparency). As these new payment and reporting models take hold and a grade card becomes public, the very future and continued success of the hospital and its co-dependent medical staff will only be realized through their unified attack on the detriments to population health.

The successful hospital and medical staff must collaboratively develop the systems and processes to meet this challenge. An environment of trust must be created within which both can confront their common challenges. The process also must involve the expanded group of community experts and stakeholders in some meaningful fashion.

The Organizational Hub. The hospital has the requisite organizational and administrative expertise to lead change. It is the most likely candidate to take the lead in establishing the structure and process necessary to develop a population health action plan. In taking the initiative, however, the hospital must solicit and honestly consider the input of its physician staff. The structure in which to house the planning process can be called the “Organizational Hub” for healthcare reform efforts in the community. 

The structure will vary in each Organizational Hub, but the Hub must, at its core, provide an environment of trust which encourages creativity and sound decision making.  It must solicit and honor ideas and opinions from all participants.  The structure also must be built for growth in order to include the involvement of community resources and be capable of morphing into an operational structure to implement the plans which are cooperatively developed.

An example of this integrative process was successfully undertaken by Flagler Hospital in St. Augustine, Florida. When challenged by community employers and commercial payers to provide better value in delivered care, the hospital board invited the members of the medical staff to help design a structure and process that would meet the challenge. The hospital board actually asked the medical staff to propose its desired organizational structure, one that would engage physician involvement.

When presented with a carefully developed and well-thought-out proposal, the board accepted and launched – with the medical staff – a separate physician/hospital-owned organization which was designed to harness the respective capabilities of both parties to achieve their common purpose. (See our White Paper, “Zero to CIN in Less Than Nine Months,” which describes the Flagler story.)

As tertiary and quaternary hospitals work to change their culture and orient toward population health management, they also will want to secure relationships with their cohort of referring hospitals, many of which are struggling with the same pressures. Engaging those referring hospitals in the process of population health management will solidify the referral relationship and aid those smaller institutions in their efforts. The formation of collaborative networks designed to engage providers regionally to impact population health is improving patient care across the continuum from rural to quaternary and bringing urban hospital capabilities cost-effectively to the rural bedside.

The University of Missouri Hospital, an academic medical center, has formed such a regional collaborative with five rural community hospitals known as the Health Network of Missouri (HNM). Through a disciplined planning process, the hospitals created a co-owned governing entity. The governing entity provided each of the hospitals, regardless of size, equal participation in the process of creating a clinically integrated network of hospital and physician resources aimed at improving the population health of the residents of Central Missouri. 

There are many other examples of structures created to promote the concept of independence through interdependence. Hospitals are able to do the hard work of converting their cultures from volume-focused to value-focused. Each has recognized the need for physician involvement in the process. Each has embraced the Triple Aim as a goal. Each believes that change is possible when trust is given and received in return, collaboration is rewarded, respect for another’s unique capabilities is honored, and the synergy of cooperation is allowed to flourish.

The Community Hub of Wellness and Health. The hospital or health system, in harmony with its medical staff, will naturally serve in the role as the Community Hub of Wellness and Health (CHWH). As financial incentives change to encourage prevention, wellness, and consideration of the social determinants of health, medical care will flow from the CHWH into the community. In this model, the hospital naturally will be relied upon as the primary coordinator of community care toward the end of improving population health.

As a result of the awakening to the importance of population health management, remarkable change is starting to emerge. Take, for instance, a Kaiser program that serves as a great example of a CHWH. It brings farmers’ markets into 30 hospital facilities in four states. 

Dr. Preston Maring introduced the Friday Fresh Farmers’ Market at Kaiser Permanente Oakland Medical Center in May 2003. Since then, the market has grown to include a system that supplies locally grown fruits and vegetables for 23 Kaiser hospital kitchens, in addition to supplying the weekly farmers’ markets in those hospital service areas. Dr. Maring also has helped establish a seasonal market at GM-Toyota’s new United Motor Manufacturing Inc., plant in Fremont, California, where 5,000 people work. 

Kaiser also worked with Sustainable Economic Enterprises of Los Angeles to open the Watts Healthy Farmers’ Market. That market provides not only farm fresh food options, but also health screenings, nutrition education, and other health promotion activities for the community. Dr. Maring noted, “Markets change the community. They provide good food, fun, and a meeting place.”[1] Such programs also create new, trusting relationships among the hospitals, farmers, food distributors, and other employers and can only increase the standing of the hospital in the community, truly establishing it as the Community’s Hub of Wellness and Health.

The Community Health Needs Assessment. A comprehensive Community Health Needs Assessment (CHNA) can serve as the perfect launching pad for a population health management effort. Bon Secours Baltimore Health System conducted such an assessment over the period of 2009-2012 that included meetings, interviews, community summits, and literature studies. It engaged community members with public health knowledge, the broad interests of the communities it served, as well as individuals with special knowledge of the medically underserved, low-income, and vulnerable populations, and people with chronic diseases.

Bon Secours’ assessment ultimately determined that to address the community’s most significant health needs, it needed to develop an action plan which:

  • Helped make the Southwest Baltimore community-of-focus a place where residents could live long, satisfying lives by being proactive about their health and wellness, understand the importance of healthful eating, and have access to healthful foods in a variety of locations and outlets, including the hospital.
  • Made the community a place where residents were ready to work, were self-sufficient, and had access to jobs that enabled them to support themselves and their families.
  • Helped the community to become more environmentally friendly, more lush with nature and green open spaces, lead-free, and a place with fresh air to breathe and safe water to drink.
  • Developed a coalition of senior leaders from the organizations which comprised the community’s health safety net.
  • Focused on primary care engagement, expanded primary care capacity, and prepared for healthcare payment and delivery transformation.

Launching this population health management plan-of-action not only has begun improving the lives of the patients served by Bon Secours, but it has cemented the hospital as an integral partner in securing the future of the community it serves. It is thereby securing its own future.

Engaging clinicians and organizing for change are the first two aspects of population health management and improvement which inform the understanding of population health as a concept. Next up, we will discuss the technical aspect of population health.

Next Up:

The Technical Aspect of Population Health

A 10-Part Plan of Attack for Population Health

[1]               M. MacVean, Kaiser Permanente Farmers Markets Put Nutrition Within Reach, Los Angeles Times (May 20, 2009), available at

What Is Population Health, Anyway? – Part II: The Clinical Aspect

A Five-Part Series
Part II:  The Clinical Aspect

In our earlier blog entry, we posited that the term “population health” is rather meaningless unless stated in terms of how it is implemented, which involves the application of the clinical, organizational, and technical aspects of population health management.  In this blog, we focus on the first of those three aspects.

If the key to achieving the “Triple Aim” is to address the social determinants of health for a defined population, as some have suggested, it is the providers on the front line who must create and deploy a plan of action.  Hospitals are the logical focal point of healthcare in a community, and a hospital’s medical staff is on the front line of interaction with the individual patients who comprise the defined population.  These hospital/physician teams logically become the “integrators” Dr. Don Berwick suggested must accept responsibility for organizing efforts to accomplish the Triple Aim.

Obviously, a new and intense level of cooperation is demanded of this team of administrators and providers.  In the past, hospitals and their physician staffs were competing for the same healthcare dollars, but now collaboration to achieve efficiencies is demanded.  Cuts in hospital reimbursement can only be accommodated with the help of physicians who work with hospital administration to find ways to reduce costs and maximize the effectiveness of hospitalization.

Physicians need hospitals, and vice versa.  If these providers are going to have any impact on the social determinants of health, which we maintain they must, then other organizations and entities in the community serving the defined population must be engaged as well.  Those contributing entities naturally will look to the hospital/physician organization as the integrator – the Organizational Hub – to lead a community discussion and issue a call-to-action focused on population health improvement.

Physician Engagement.  There are many challenges to achieving the level of cooperation that is demanded.  Certainly, physicians are essential to the process of shifting the focus of healthcare delivery from the existing episodic sick-care model to a system yielding value.  But physicians often are the ones who are the most perplexed, depressed, overwhelmed, threatened, and downright angry about the direction healthcare delivery is headed.  While physicians may, in their hearts, understand the need for change and concur with the ultimate goal, the process of getting there has many of them totally confused and defeated.  Unfortunately, they don’t necessarily see the hospital as a natural ally.

One of the first steps necessary for hospitals to engage physicians is to repair any broken trust that may have arisen between the hospital and its medical staff.  Such schisms are common.  They must be confronted directly and reconciliation achieved before the hospital/physician Organizational Hub can provide any sort of meaningful leadership in the community to address the challenges of population health and its management.  

Secondly, hospitals must address the challenge of sustaining physicians emotionally and financially while engaging them in the process of change.   Emotional stability flows from having the ability to control one’s environment, and it is this very sense of loss of control that has physicians so out of sorts. 

When we balance the enormous need to reinvent clinical processes with physicians’ need to gain control of their environment, the obvious answer for hospitals is to invite the physicians into a structured process that examines everything from clinical protocol to hospital procedures and business practices that are refocused on Triple Aim objectives.  Physicians will engage if their ideas and opinions are valued.

The efficiency and effectiveness of clinical processes are at the heart of creating value.  Only physicians can effectively drive the development and deployment of the most efficacious treatment protocol.  Only physicians have the prestige and the opportunity to meaningfully engage patients in the process of managing their own health.  Only physicians can meaningfully engage their peers in monitoring providers’ adherence to protocol and manage the efficiency with which care is delivered. 

Physician Leadership.  Identifying effective physician leadership is key to establishing a workable partnership between the hospital and its medical staff.  Many healthcare organizations seeking to implement effective population health management strategies are calling upon a new C-suite leader, the Chief Population Health Officer (CPHO), to lead the Organizational Hub’s efforts.  This relatively new position is often a physician executive who reports directly to the hospital CEO.   He or she is charged with developing and implementing the Hub’s population health management strategy. 

The CPHO job description includes responsibility for complex case management; overseeing disease management programs; implementing health risk assessments; devising wellness and lifestyle management strategies; developing health education programs; monitoring population health indicators such as patient activation, patient satisfaction, quality of life, actuarial analysis of risk evaluation methodologies; and overseeing managed care contracting. 

Physicians have to be at the table when clinically integrated processes are developed, and they must accept the invitation to participate lest they have processes foisted upon them.  It is not reasonable to expect every physician to participate actively in the role of planner and administrator of new clinical processes.  Each physician, however, must at least accept responsibility for becoming aware of the dialogue and monitoring the change that is occurring around him or her. 

Expanding the Team.  As physicians and hospital leaders begin their collaborative efforts, they also must realize that they are part of a much larger, very diverse team that is required to achieve improved population health.  Access to quality medical treatment accounted for only 10% of a person’s health status.  Behavioral choices such as diet, physical activity, and substance abuse; social circumstances such as education, employment, housing, crime exposure, and social cohesion; genetics; and environmental conditions all impact population health status far more profoundly.

It has been argued that one’s zip code may be more important to health and wellness than one’s genetic code.  This concept is the underpinning of a new discipline known as healthography. 

The Robert Woods Johnson Foundation has created city maps which highlight the enormous disparity in the status of nearby neighbors.  For instance, babies born in Washington, D.C., separated by a few metro stops, may experience as much as a 7-year difference in life expectancy.   Newborns in different neighborhoods in Kansas City, Missouri, can have a 14-year difference in life expectancy.   Babies delivered in different New Orleans locations can be expected to show a 25-year difference in life expectancy.

To impact all these factors and improve population health status, the core team of physician and hospital leadership will have to involve a variety of other community stakeholders:  therapists, behavioral health professionals, social workers, community healthcare organizations, educators, social service agencies, urban planners, law enforcement agencies, politicians, the judicial system, the faith community, restaurants, gyms, and retailers.

Improvement in population health will require engagement of all the social and medical systems that impact the quality of patients’ lives.   It will have to consider the impact of healthography and determine the causes of the dramatic disparities it illustrates. The hospital’s CPHO logically should serve as the catalyst for community engagement and be tasked to develop meaningful relationships with community partners that traditionally have been ignored by healthcare leaders.

Finally, and perhaps most importantly, the expanded team of providers and community stakeholders must devise ways to engage the individual patients who comprise the population served to pursue improving their own personal health and healthy lifestyles.  That may be the biggest challenge of all. 

Patients have almost been trained to live in ignorance of the impact their lifestyle choices have on their health.  Often, they live recklessly and expect simply to have health problems “fixed.”  Environmental influences such as fast food ads, the size of soft drink cups, food portions served in restaurants, the tolerance of tobacco and drug use, movies and advertising that portray risky lifestyles, and the impact of poverty create strong headwinds of social mores that must be overcome to successfully achieve gains in population health.  Patients need to know they have responsibility in this effort, and they must be encouraged to accept that responsibility. 

When hospitals, their medical staffs, community partners, and stakeholders are brought into alliance to pursue population health improvement, the definition of population health will begin to crystalize.  With sharpened focus, terminology will cease to be an obstacle to defining strategic objectives and developing realistic tactics that harness the power of providers to measurably improve the health status of the defined population they are serving.

Unfortunately, crystalized vision and unified effort are squandered without an effective organization to guide and direct the army of stakeholders required to effect change in a population’s health status.  Next up, we will discuss the organizational aspects of population health as we continue exploring this elusive concept.

Next Up: 

The Organizational Aspect of Population Health

The Technical Aspect of Population Health

A 10-Part Plan of Attack for Population Health