Oct
14

Pay for performance study results

Fellow blogger DB’s Medical Rants has an interesting take on pay for performance. Citing a study published in the New England Journal of Medicine, the post notes:
“One underlying principle of the pay for performance movement stems from the belief that we can use incentives to improve adherence to evidence based quality indicators. The crux of evidence based medicine (EBM) follows from an examination of high quality data. EBM eschews belief.
This study tries to understand how P4P might influence physician practice. It finds no positive impact. Rather P4P may simply be a scheme for rewarding high performers…
However, as I hear the debate, most proponents see P4P as a means to improve quality. This article argues against that.”
Changing physician behavior is a windmill that has absorbed billions of dollars and millions of hours of tilting, with little evidence of impact. While the objective is noble, the business case is highly suspect.
What does this mean for you?
Identify the best performing physicians and direct your patients to them. Let others shatter their lances.


Oct
13

ACOEM Survey on providers and payers

ACOEM, the American College of Occupational and Environmental Medicine, is reaching out to payers – TPAs, employers, insurers, managed care companies, to find out about their interests, priorities, and views on occupational medicine.
The “conversation” between payers and providers is usually limited to voice mail, email, and fax, with the occasional mutterings under one’s breath. Here’s a chance to help improve the dialogue.
If you are involved in this area, take the time to fill out their survey.
Here’s more information.
“Effective occupational medicine: opinions wanted
Want to have an impact on the future of occupational medicine? Do you purchase (or influence the purchase) of occupational medicine services for your organization? Do you manage relationships with medical service providers for your company? If so, the American College of Occupational & Environmental Medicine (ACOEM) invites your opinion via an online survey.
The purpose of the survey is to assist the American College of Occupational and Environmental medicine (ACOEM) in learning more about the current practices, priorities, and point of view of those who pay for and use occupational medical services. In particular, ACOEM wants to learn how company managers and executives in organizations are currently viewing a few major issues in organizational and occupational health. ACOEM also wants to hear what companies look for when choosing physicians to provide either hands-on or consulting medical services for their workers compensation and disability programs.
The survey is being conducted by Crescendo Consulting Group, a national research and consulting firm based in Portland, ME. Results will go directly to Crescendo Consulting Group to preserve anonymity.
The survey should take less than 15 minutes of your time, and individual responses will be confidential. In exchange for participation, ACOEM will provide an executive summary of results to any participants who supply contact information. ”


Sep
27

Concentra’s investor briefing

Concentra Inc.’s presentation at the Bank of America Investor Conference earlier this month focused on their continued growth, focus on workers comp, and impact of the acquisitions of Beech Street and Occupational Health and Rehab.
Here are some of the highligts from the presentation and comments on same.
Revenues for 2005 are projected to be $1.1 billion, with EBITDA of $156 million and operating cash flow of $101 million. Revenues are growing organically about 5% per year, while operating cash flow is down from $114 million in 2003 to $98 in 2004 to $101 in 2005.
Workers comp is by far their largest market, driving 70% of revenues. The Beech deal will certainly help diversify Concentra’s revenue base, as Beech is a strong mid-tier group health PPO. Beech’s provider contracts will also be compared to the Concentra contracts to identify the ones with the best rates. This, coupled with the greater buying power brought by Beech, may help Concentra drive better deals with some providers.
Of Concentra’s three distinct business units, by far the highest margin business is network services, with a margin of 31%, followed by the clinic business’ 14% margin. The care management sector, which is primarily field and telephonic case management, was hurt by declining revenues and price compression and returned 6%.
Of note, the clinics saw same store revenues up 6.6% on a 5% increase in visits. This at a time when the WC injury rate has been declining by about 4%.
Thomas made the point several times that after the completion of the OH+R deal, Concentra’s clinics will see one of of every ten workers’ comp injuries for initial care. While that sounds impressive, and is impressive, it is important to note that the clinics only see the routine injuries, and most of the dollars that are spent on WC medical go to the more complex cases that are treated by specialists.
The Beech Street and OH+R acquisitions were expensive at $210 million +. The Beech deal adds significantly to Concentra’s group health product offering. while OH+R will add 26 clinics after 8 existing clinics are closed.
Both Thomas and Kiraly repeated their assertion that Concentra is the industry leader in the WC managed care business, and is a full service integrated services provider. From a sheer numbers perspective, they are correct. However, other entities are leaders in segments of the WC business. For example, Coventry’s First Health is by far the leader in the WC PPO sector. MedRisk is the industry leader in management of physical medicine; and PMSI in pharmacy management.
Thomas noted that because Concentra manages all aspects of the claim, it therefore impacts more claims dollars than other competitors. Not exactly. Intracorp has case management, networks, bill review, peer review, and access to specialty managed care. So do Genex and CorVel. Concentra’s out of network bill negotiation entity (Concentra Payment Services) may well be the industry leader in non-network bill processing, but a host of competitors are now in this space.
While Concentra is not a public company, rumors have been rampant for years of their desire to become one. That, coupled with the large amount of debt outstanding, is evidently the reason for their continued participation in these road shows.


Sep
14

Medicare physician reimbursement cuts

The latest news from Washington indicates the cut in Medicare reimbursement scheduled to go into effect on 1/1/06 may actually occur. The reduction of 4.3% is a hot topic amongst physicians, many of whom are claiming they will not continue to treat Medicare patients if the cuts go through.
Two of the key Senators on the Finance Committee (which has jurisdiction over CMS) have stated their desire to rescind the cuts. According to Congressional Quarterly, “Sen. Max Baucus (D-Mont.) said he and Senate Finance Committee Chair Chuck Grassley (R-Iowa) are “not going to let those cuts go into effect this year”.
The fate of the proposed fee reduction will not just affect Medicare. Many group health and HMO reimbursement arrangements as well as states’ workers compensation fee schedules are based on Medicare.
Yet more evidence that when CMS gets a chill, the rest of the health care payers catch a cold.
What does this mean for you?
Keep an eye on Congress’ actions, or lack thereof, on this reduction. Regardless of the action taken or not, it will affect health care payers’ bottom lines.


Aug
29

CHOICE Awards for Workers Compensation

I’ve been hard pressed to keep up with the blog; seven days in Florida starting at the Florida Workers Comp Institute annual conference followed by a three day audit of a managed care firm is to blame. One of the biggest events at the conference was the third annual CHOICE Awards for excellence in workers compensation.
These awards are presented to physicians who exemplify the highest standard of care and demonstrate thorough understanding of workers comp and return to work while communicating clearly and effectively with all parties in the process.
Physicians are the key to effective workers comp and other medical programs.
They diagnose the condition, assess the patient, develop the treatment plan, write the scripts, schedule the imaging, refer for surgery, deal with managed care’s questions and requests for information, monitor progress, and remove obstacles.
In workers comp, docs also identify limits and restrictions, develop return to work programs, recommend job accomodations, coordinate with employers, assess relatedness, and cajole, badger, encourage, and push injured workers back to work.
Many docs do this despite the request from insurers that they perform these services for a “discount” below their list price or fee schedule.
The unfortunate thing is the CHOICE awards are one of the few efforts by payers to publicly recognize those physicians that outperform their peers. And it is not a few docs getting a black plastic award and handshake from an insurance company exec. Over 200 nominations were received, a rigorous judging process was conducted, and all finalists were invited to the banquet. (disclosure – CHOICE is a client).
The keynote speech was given by University of Miami president and former Secretary of HHS Donna Shalala. The sit down dinner was attended by 400+. The band played for each recipient and for all the guests before and after the awards.
And the award recipients deserved all of it.
What does this mean for you?
If you have yet to figure out that physicians are the most important contributors to the success of managed care programs, get with the program.


Aug
24

Aetna’s quality ranking of physicians

Aetna announced they will be offering a new health plan network option in northern California and the Central Valley that ranks specialists by several cost and quality indicators. The program, which goes by the unfortunate name of Aexcel, will only include those specialists that meet the Aexcel standards, and will be offered to larger self insured employers.
According to California HealthLine,
“Aetna evaluates them on factors including:
Number of hospital readmissions within 30 days;
Adverse events;
Adherence to clinical guidelines; and
Cost of care — adjusted for the severity of a patient’s illness — relative to the geographic area.
The health plan considers Aexcel specialists to be the top-performing in an area with regard to cost and quality. Employers can include Aexcel in Aetna’s non-HMO health plans, either as an option or a requirement.”
Kudos to Aetna for their courage – physicians who do not meet their criteria will undoubtedly protest, and some may have valid points. But the key is to start somewhere, and this is a great start. The best physicians deserve more business, and docs who underperform deserve less.
What does this mean for you?
More incentive to differentiate your health plan, or select a health plan, based not on a spreadsheet but on the value they deliver, defined as the plan’s ability to help you improve outcomes and costs.


Aug
15

Less “Managed care” for Washington surgeons

Surgeons who are top performers in Washington’s Department of Labor and Industries (L&I, i.e. workers comp) program will no longer be subjected to utilization review hassles. 111 physicians have been identified as providing all necessary documentation to the state’s UR program, and all of the surgeries they recommended were approved. The result – they won’t have to ask permission anymore.
The UR program is run by Qualis Health, and focused on carpal tunnel, shoulder, and knee surgeries performed over a two year period. According to the report in Insurance Journal, the 111 surgeons’ results will be monitored over the next year.
“If it is determined that the number of unnecessary surgeries doesn’t rise as a result of less oversight, L&I likely will expand the program to train and include additional physicians.
L&I-funded studies, conducted by the University of Washington, show that injured workers who get prompt and appropriate medical treatment tend to recover and get back to work more quickly. That results in lower workers’ compensation claim costs and less missed work. One obstacle to receiving timely treatment is unnecessary delays in authorizing procedures.”
No kidding.
While it is gratifying to see that physicians who perform well get treated differently by managed care overseers, it is indeed frustrating to recognize that this is one of the few programs of its type, and managed care in the form of precert has been around for more than two decades.
Here’s hoping this is just the first of many intelligent decisions to identify the good docs and leave them alone.
What does this mean for you?
If you are a physician, perhaps a little hope. For managed care firms and folk who contract with them, get with the program. Stop monitoring everyone and start using that huge amount of data resident on your systems to identify the good docs.


Jul
29

Pay for Performance – Medicare initiative

Pay for performance is likely to get a big boost from the Federal government. A bill linking physician pay under Medicare to reporting quality data will be introduced in the Senate before the end of the year, the first step towards a pay for performance model.
Sen. Chuck Grassley (D IA) is the protagonist; as Chair of the Senate Finance Committee Grassley has both jurisdiction and significant influence over the Medicare program.
According to California HealthLine;
“The legislation would allow the HHS secretary to reward providers first when they report quality data and later when they improve quality or meet certain quality thresholds. The legislation would establish a “value-based purchasing” system for providers — such as hospitals, physicians, Medicare Advantage plans, home health agencies and skilled nursing facilities. Under the bill, physicians who report quality data would receive the full update to Medicare reimbursements allowable under current law in 2007 and those who do not report quality data would have their updates reduced by 2%.”
Currently, physician reimbursement under Medicate is slated to drop by 4.3% on 1/1/2006. This decrease is part of past legislation, and has been rescinded in recent years. However, it does require Congress to act or the decrease becomes effective. In this case, it appears Grassley is using it to promote the “P4P” initiative.
What does this mean for you?
Pay for performance is likely to become a reality. You can choose to fight the very concept, or engage and contribute to the dialogue. As Congress is especially adept at the “blunt instrument” style of reform, physicians will be better served engaging rather than avoiding.


Jul
25

Insurer – Physician communication

One of the most important benefits of the internet is improved communication among and between folk who otherwise would likely not interact. And blogs add immeasurably to that improvement. For some time I have been reading and occasionally cross-posting to and commenting on several providers’ blogs, and more specifically two blogs written by thoughtful, highly intelligent, and obviously concerned physicians. The latest discussion is on DB’s Medical Rants and concerns pay for performance.
Another excellent physician blog is Health Care Renewal.
As one of the few “payer-side” bloggers, I have also received (or perhaps been subjected to) many comments from folk on the provider side. While the discussions can be contentious at times, they are direct, insightful, and helpful in advancing understanding.


Jul
11

Medical malpractice – what crisis?

While medical malpractice premiums were climbing dramatically from 2000 to 2004, claims did not increase at all. The finding from a study by the Center for Justice and Democracy reported in the New York Times, examined the premium and claim histories of the 15 largest med mal carriers and found that while premiums escalated 120%, claims were flat while the insurers’ incurred loss ratios (ratio of claims to premiums collected) improved by almost 25% to 51.4%.
What gives? Does this mean the “med mal crisis” of a few months ago was a myth? Depends on who you listen to. The Times article notes:
“According to Connecticut Attorney General Richard Blumenthal (D), the results of the study “have the potential to alter the debate fundamentally from seeming to cast the rapacious personal injury lawyers as the complete culprits and the insurers as innocent bystanders with doctors as victims to the insurers as equally responsible, if not more so.” He does like to turn a phrase…
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