AHLA Masters Program Bonding with Physicians and Improving Quality Scores Bruce A. Johnson, Faegre & Benson LLP, Denver, CO
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1 AHLA Masters Program Bonding with Physicians and Improving Quality Scores Bruce A. Johnson, Faegre & Benson LLP, Denver, CO Introduction. A summary of our firm s key questions, observations and recommendations to Striver follows. Note: It is unclear whether this is a new or established client relationship, and this is relevant to understand our firm s past involvement (and advice) to Striver, our credibility (and/or perceived culpability) relative to current conditions, and to get a sense of the baggage we might bring to the engagement. I. Questions to be Asked/Unknowns. We recommend that interviews with key parties be conducted early on to obtain answers to the key questions below: Current state of physician-hospital relationships within Striver: o Perceived needs for improved quality scores and physician relationships; o Perceived role and value of physicians to Striver near and long term goals; o Identity of physicians/groups critical to goal attainment; o Groups/physicians viewed as quality providers and quality leaders; o Views of Striver infrastructure in support of physician practices; o Level of physician practice EHR adoption and opportunities to work together in infrastructure; o Striver s current approach to legal compliance, strengths and weaknesses of that approach; o Other observations and comments they have regarding the goal of improving quality and bonding with physicians. Striver s existing physician leadership structure and culture. Current role and practices of VPMA, medical staff leadership, medical staff committees etc. Finances. Current financial condition and financial reserves of Striver, fiscal year and status of budget process (for example, are budgets currently in the works or completed). Striver financial reporting, accounting and related practices. Reporting format (system-wide/consolidated reporting, hospital-specific, service line etc.), SPG allocation of indirect costs, shift of ancillary services and related issues. State of CEO relationships with physician leaders in key groups. State of Executive team, Executive team/board alignment (for example, regarding Striver s current conditions and future direction). Practices relative to use advisors (legal, financial, management consulting etc.) past, present and future. 1
2 Decision-making (for example, CEO or Board driven; centralized or decentralized; micro-management vs. decide and move on; the slow no etc.). SPG physicians and relationships (for example, compensation and production levels; involvement and approach to practice operations; existing contract duration and termination dates etc.). Executive team and Board perceptions re SPG (for example, valuable vs. money pit; strategic investment etc.). SPG reimbursement model (for example, are ancillary services furnished and paid for under the SPG tax-id; provider-based clinics; existing and future basis for reimbursement from Medicare and other payers etc.). Role of compliance officer and her relationship with in-house counsel (i.e., did Striver get into this mess due to lack of attention to by counsel/compliance; executive leadership neglect of compliance guidance etc.). II. Assessment General Observations. Striver has not placed significant emphasis on quality care in the past, and its past and present relationships with physicians appear to be fraught with compliance or other challenges. Given this, don t expect current conditions/problems to be fixed over night. Striver won t have enough time, money or energy to all issues concurrently. Executive leadership will need to work with the Board to set priorities, pick battles carefully, and position to respond to unexpected opportunities and demands. Recognize and acknowledge historic problems and need to develop realistic strategy to address in near term; align Executive team, Board and physician leadership to the extent possible. Even the best plans and strategies will require midstream adjustments. Define longterm goals and direction, define strategies and tactics in furtherance of those goals, but remain flexible and prepare for the inevitable speed bumps and potential detours. Opportunities. Past approach to quality may provide many opportunities for improvement. SPG and group s geographic spread may be of value to payers. University hospital interest in relationship, coupled with existing residency programs may permit long-term focus on quality through new attending faculty and resident education/training. 2
3 Residency program may help address mission concerns (i.e., growth of poor/ uninsured), with physician alignment via residency and community-based/private practice model. Reimbursement challenges may drive cardiology, oncology and other specialties to seek stability in alignment with Striver in uncertain times. Heart Institute as independent, physician-owned entity is probably unlikely due to development timeline, capital requirements, reimbursement changes and other challenges. However, a Striver-owed Heart Institute facility may constitute a service delivery location that can help enhance practice efficiency, quality, research and other objectives. Such a Heart Institute could comprise a key component of the system s long-term quality and bonding strategies. Potential opportunities to capitalize on payer marketplace differentiation goals to develop new relationships that provide reimbursement for P4P and similar initiatives. Employed group may provide platform for future growth and alignment strategies. Despite the compliance challenges (see below), may be possible to reverse course with a demonstrated commitment and actions relative to compliance. Separate SPG legal entity provides structural separateness for improvements in physician leadership/governance, financial management, autonomy/control, practice operations, infrastructure, and related issues outside of hospital culture. Challenges. Apparent past inattention to compliance probably means that there are many compliance dead bodies that could be unearthed. Compliance officer may be on way to becoming a whistleblower. Ability of key groups to redirect business to other hospitals if Striver engages in threatening actions. Multiple failed physician-hospital relationships (for example, managed care product). Key Board members and Executive leadership not same page. Old school CFO with attitudes that are likely not helpful to physician bonding. Facts do not suggest existence of clear physician leaders who are aligned with hospital leadership. SPG compliance challenges related to compensation methods (consideration of hospital referrals, inclusion of midlevel productivity credit), and amount (compensation at the highest end of published surveys), although it is unclear whether these are real or perceived problems. Specialty practices in employed group (for example, neurosurgery, radiation oncology etc.) are typically individualistic from cultural and compensation perspectives, so collaborative governance/ leadership structure within SPG may be more difficult. Separate SPG legal entity and physician board will likely make change process more challenging. III. Recommendations 3
4 Goals Overall. Although Striver s stated goals are to enhance quality scores and bond with physicians, the practical goals of our work should include the following: Align and bond with physicians Promote quality patient care Help effect changes to Striver s organizational culture to promote compliance Stay out of jail and media light Strategies and Timeline. Specific objectives, strategies and a rough timeline are outlined below to provide a general rod map (subject to change based on evolving conditions) to help guide near and longer term actions. Immediate Term (June 2009 December 2009): Objective. Begin to develop a common vocabulary and culture that s focused on quality and compliance, by focusing on key themes: o Existing and future role of quality in health care; o Role of physicians in a quality agenda, and range of platform(s) for physician relationships and bonding; o Technology and other infrastructure needs for quality improvement and effective physician relationships; o Compliance requirements and needs. o Conduct multiple working meetings/ educational sessions involving executive leadership, Board, SPG and community physicians; o Consider using summer and key events (for example, publication of physician fee schedule, health care reform etc.) to stimulate interest and discussion over summer; o Conduct more significant meetings during fall (2009); o Develop strategies that permit participation of select community physicians without creating independent compliance problems (for example, conduct meetings on-site, monitor value of benefit provided in connection with meeting (non-monetary compensation), require participation under existing medical director, employment and/or other physician relationships). Objective. Educate Board leadership that future solutions may require taking medicine on past compliance issues as means to invest in the future. Get board leadership on board. Consider role and involvement of compliance officer in discussions. Meetings with senior executive and Board executive committee. Objective. Assess potential compliance issues, develop options and develop strategy. Engage in candid discussions with senior executive regarding potential compliance issues and evaluate options. Develop recommendations regarding fact collection/assessment and potential remedies (for example, repayment, voluntary selfdisclosure etc.). Advise and assist in decision-making regarding whether to dig into 4
5 the past, fix going forward, or both. Assess Striver s willingness to do anything if compliance issues are uncovered. Objective. Set stage for future by defining role of executive leadership Board, internal and external advisors (legal, accounting, management consulting and other) etc. o Evaluate physician contracting and compensation process under direction of legal counsel. o Assess compliance weaknesses; prioritize, develop and implement policies and processes to address. o Establish compliance and compliance-related education as essential component of all strategies, including appropriate involvement of legal counsel as resource and advisor. o Take reasonable steps to align legal counsel and consultant views before recommendations are presented in public forum. Objective. Define and articulate near-term and long-term goals/vision relative to quality and physician relationships using the following themes to guide activities: 1. Role of quality and quality improvement goals to Striver (i.e., quality as defining theme for the health system s future), and physician leadership and role in quality improvement. 2. Physician relationships (employment vs. other) with Striver, with emphasis that one size fits all. 3. Technology and physician practice infrastructure needs. 4. Legal compliance as essential to all strategies. Method. Develop and articulate through collaborative planning process. Mid-Term (January 2010 to June 2011) 1. Objective. Role of quality, QI goals and physician leadership in a quality agenda. Methods. o Establish Board-level quality committee. o Define VPMA role relative to quality and/or allocate resources for physician leadership on quality. o Convene quality workgroups to begin to address quality concerns. Define within each workgroup, practical, achievable quality measures and goals in the form of score improvement. o Consider clinical integration/network development as part of quality strategy. o Explore potential relationships with University (if any) on research, quality improvement or other areas. o Embed compliance education and training in process to help change Striver s culture related to compliance. 2. Objective. Physician relationships and role of Striver Physician Group. Methods. 5
6 o Explore integration (employment via hospital or SPG) with ACC, BigHeart, or both. o Obtain input of SPG physicians (informal) on physician leader job description, relationship with others. Appoint physician leader and establish leadership stipend. o Work on SPG development, including interface with community physicians as part of quality initiatives. o Retain physician practice administrator to help direct SPG; develop SPG physician-administrator team. o Convene compensation and governance planning committee (select SPG physicians and Striver leadership) to address SPG governance and compensation architecture. Address physician leadership and governance role relative to quality initiatives, practice operations etc. Distinguish governance (physician influence and involvement over key issues), from formal legal governance systems and processes (for example, Striver and SPG governing board roles and responsibilities). o Articulate must haves for any new compensation structure: Productivity based system that relates work to compensation; Flexible to accommodate different types of work (for example, performance in relation to quality measures, patient satisfaction, cost management etc); Promote reasonable physician ownership of their practice to extent possible; Financially sustainable (with pre-defined levels of financial subsidy); Legal and consistent with Striver s evolving compliance culture. o Perform benchmark/fmv assessment of SPG under legal counsel direction. o Legal counsel assessment of specifics of compensation levels and plan mechanics and compensation levels. Evaluate availability of alternative compliance strategies (for example, in-office ancillary services exception, etc.). o Address compensation plan transition/implementation process and timing that considers infrastructure needs for quality focus, EHR deployment (for example, productivity support during early stage of adoption etc.). o Consider replacing contractual provision, if any, requiring referrals with physician choice based on quality care. o Position physician employment (SPG and/or direct by hospital) as one of several alignment strategies.. o Embed compliance education and training in process to help change Striver s culture related to compliance. 3. Objective. Technology and infrastructure. Methods. o Convene EHR evaluation and selection committee; involve SPG and other community physicians (including ACC and BigHeart). o Map out EHR roll-out process and timeline; consider timing of federal support (stimulus funding; Stark and AKS exceptions). Define role-out process (for 6
7 example, SPG first; clinically integrated network second; general medical staff etc.). o Develop SPG physician practice infrastructure given likely growth of Striveraffiliated physician practices in the future. o Focus on accuracy and timeliness of reporting of physician performance, financial and other data within SPG. Where there are problems, acknowledge them then move on to improve. o Include compliance training and education in process to help promote education and change compliance-related culture. 4. Objective. Compliance. Methods. o Establish Board committee structure to address physician contracting and compliance issues. o Adopt Board-approved policies regarding physician compensation methods and amounts; including level of executive team decision-making and when Board approval is required. o Establish Board-level compliance and risk management process, including ongoing reporting structures and relationships. o Establish and implement effective contracting database and contract management process. o Implement TBOR/rebuttable presumption review process. o Implement existing in accordance with policies. o Update and reeducate (to change bad habits). Long-Term (June 2011 through 2013) 1. Objective. Role of quality, QI goals and physician leadership in a quality agenda. o Use Striver Physician Group as platform for quality improvement activities where feasible. o Evaluate additional strategies (for example, patient safety organization) 2. Objective. Physician relationships. o Potential implementation of integration (employment via hospital or SPG) with ACC, BigHeart, or both. o Position residency program growth as critical to long-term solution related to primary care shortage. o Link residency and community practices to growth of market share. o Use existing EHR platform to implement fuller clinical integration program. 3. Objective. Technology and physician practice infrastructure o Roll out EHR on agreed time-line. 7
8 o Implement productivity adjustment under SPG compensation plan to support EHR adoption. 4. Objective. Compliance. o Implement existing in accordance with policies. o Update and reeducate (to impact bad habits). IV. Closing Thoughts A strategy that recognizes the need to constantly adapt in the face of unexpected opportunities and challenges will be essential. Hang on for the ride! 8
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