Cardiologists treat patients who are older, sicker, and more reliant on Medicare. That means they must pay attention to new payment models from CMS that reduce reliance on fee-for-service and increase the presence of accountable care organizations.
The Affordable Care Act (ACA) brought with it a host of provisions to change the way healthcare is delivered, which were designed to make Americans healthier while making the system more accountable and less costly. Cardiologists are affected by these changes more than most specialists, as a sizable share of their patients are older, sicker, and reliant on Medicare, which is demanding that physicians change the way they do business. To that end, the 64th Annual Scientific Sessions of the American College of Cardiology, being held March 14-16, 2015, in San Diego, California, held a session Sunday, “Transforming Care: Innovations in Delivery and Payment Systems for Cardiovascular Care.”
Michael E. Chernew, PhD, professor of Healthcare Policy at Harvard Medical School and a co-editor-in-chief of The American Journal of Managed Care, offered a policy overview to help cardiologists understand the forces behind new payment models, and accountable care organizations (ACOs) in particular. Because of federal fiscal concerns it is important to understand that that the policy discussions surrounding payment reform are often motivated less about health and more about taxes, Chernew said, as policymakers seek to stem healthcare’s unstainable share of federal spending.
Payment reforms represent one strategy to control spending growth, he said. One type of payment reform is simply to pay less. But there is more enthusiasm for developing a payment approach that moves away from the traditional fee-for-service (FFS) model toward a system that bundles care across time and provider type. (CMS has recently announced that Medicare wants to see 30% of payments tied to value by 2016 and 50% by 2018, for example.) Examples of such reforms include payment bundles for episodes of care and global payments for each patient.
An important step in the transition has been the creation of accountable care organizations, or ACOs, which are healthcare systems that take responsibility for patients at all levels of care, while giving those systems opportunities to share in savings if they produce better-than-expected health outcomes for their patient populations. While Chernew presented data showing significant ACO growth among Medicare ACOs, commercial insurers have also pursued risk-sharing models. As he explained later in the question-and-answer session, a challenge with ACOs is that while they are supposed to ensure coordination of care, it may not be in their interest to form direct relationships with post-acute elements like skilled nursing facilities, if the incentives are not in alignment.
ACOs were designed to slow spending growth, and Chernew presented data that show this is happening for cardiologists. But ACOs have their problems, including patients not staying with the same ACO from year to year or seeking care from non ACO providers during the year. Another challenge is that currently ACO payment is rebased based on organization-specific performance, meaning that successful ACOs see a greater drop in benchmarks over the contract period. This discourages savings. Chernew noted CMS is likely to reform this part of the program in the future.
Andrew Ziskind, MD, a cardiologist and health system administrator now with Huron Consulting Group, Chicago, Illinois, discussed the specialty’s challenges due to its older patient population, whose costs run much higher than their European counterparts. Later, due the question-and-answer period, he elaborated that this is largely due to American cultural differences that push medicine toward costly end-of-life care even when positive outcomes are unlikely. He subsequently called on fellow cardiologists to embrace and promote palliative care, which studies show patients embrace when this option is presented.
Controlling costs in the era of bundled payments, he said, is going to come down to learning to better manage outpatient care. As Chernew mentioned before him, trends toward consumerism—happening in part because cost-sharing is being pushed down to patients—mean that individual patients will have access to information about the price of tests and procedures that they would not have thought to ask for in the past.
The fundamental shift from FFS to payment for value is going to put more risk on providers, especially the government becomes a larger “payer” in the healthcare system.
Competition on price will come down to what is happening locally, Ziskind said “We can talk about national trends, but the local market, each local metro area is different.” How much provider competition is there? What is the relationship with the hospital? Most critically, what is culture of utilization: is it like the Northwest, with a culture of low utilization, or more like New York and Florida?
Shared savings will continue to be a force for change, he said, but it has a bottom. “The cost of care can’t go down to zero,” he said.
A key criteria for contractor relationships between providers and payers for the near term is, what are the exclusion criteria that allow payment to revert to fee-for-service? This is important to specialists.
Most of all, Ziskind encouraged cardiologists to become engaged in payment reform within their institutions, build better infrastructure, and demand a seat at the table. Cardiologists need to look for areas where they can help the systems they are in improve, especially in chronic disease management. Tomorrow’s rewards will come from avoiding unnecessary costs. “You want to be preparing for the future. Protect your fee-for-service revenue, but at the same time, be preparing for the future,” Ziskind said. “If we as cardiovascular providers can do a better job of delivering care, the economic alignment is there.”
Cathleen Biga, CEO of Cardiovascular Management of Illinois, said the recent past has been a time of her change in her organization. “When we left his conference 2 years ago we knew we had to do something,” she said. Navigation the transition from FFS to bundled payments is very difficult for providers, because “If you get arrive too soon you might be penalized, but if you arrive too late you might be penalized.”
There’s no rule book, Biga said, “except the colleagues I call on a routine basis.”
CMS’ Center for Medicare and Medicaid Innovation has models for acute, acute and post-acute, and post-acute care, and like Ziskind, Biga recommends that post-acute care is where a health system’s focus has to be. Yet for cardiologists this represents a true change of mindset, because many practitioners have spent careers doing procedures that had little to do with outpatient care. Today, Biga pays attention with happens in nursing homes, because so much of a bundled payment can be consumed in that setting.
Cardiology, she said, is not like specialties such as orthopedics, where a patient is treated, healed, and sent on his way. When a patient is diagnosed with cardiovascular disease, “you’re part of our world forever.” This has meant “blowing up” a delivery of care model that Biga said “pigeonholed” caregivers. “We were not good at transitions of care.” It was hard to do but essential. Her organization worked with a convener, gathered “tons of data, and “there’s this little thing called risk.”
Along the way came some interesting discoveries: it made more sense to keep a patient in the hospital one extra day than to send him to a nursing home where the risk was a series of recertifications that would drive up costs. Cardiologists had to develop better relationships with hospitalists who controlled patients’ care. And the big one—especially in the Chicago area—has been gaining control over decisions about where patients are discharged to nursing homes and ensuring that they give quality care.
Details matter, Biga said. Paying attention to documentation and coding is essential. “The office is just as important to risk adjustment,” she said. “If you’ve got a sick, chronic patient, document it.”