How To | Bundled Payment

7 keys to engaging physicians for success under BPCI-A

How To | Bundled Payment

7 keys to engaging physicians for success under BPCI-A

At a glance

A health system’s ability to obtain physician support for a bundled payment initiative hinges on seven actions by the system leader:

  1. Seizing new physician incentive opportunities
  2. Involving physicians at key levels of program governance
  3. Providing physicians with valid, actionable data
  4. Empowering physicians to select or design clinical protocols
  5. Making sure physicians understand the importance of accurate documentation
  6. Using physician scorecards to root out variation
  7. Letting physicians manage physicians


The government’s newest bundled payment model makes physician engagement more important than ever, and it creates new incentives for physicians to become more involved and take on leadership roles.

The Centers for Medicare & Medicaid Services (CMS) launched the Bundled Payments for Care Improvement Advanced (BPCI-A) model in October 2018, and the program’s second cohort of voluntary participants will start this January. Although it is important to master the details of the new program, finance leaders need to keep their eyes on the basics.

To succeed in BPCI-A, participants must heighten efforts to control episode costs, ensure care quality and manage the entire continuum of care, from patients’ initial care encounters through post-acute care. Achieving these goals requires physician engagement, fostered by strong physician leaders. Simply put, it requires a clear understanding of physicians’ priorities and the design of physician-led management structures (see sidebar listing three distinguishing featureso BCPI-A) .

Following are seven strategic steps for cultivating physician engagement in BPCI-A.

1. Seize new physician incentive opportunities

BPCI-A offers new financial incentives for actively engaging physicians in efforts to improve value through a focus on achieving specific goals around quality and outcomes.

Quality incentive payments. Because BPCI-A qualifies as an advanced alternative payment model (APM) under the Medicare Access and CHIP Reauthorization Act (MACRA), physicians participating in a BPCI-A bundle can earn additional Medicare Part B payment when outcomes surpass benchmark targets.

Shared savings incentives. Physicians participating in a BCPI-A bundle are eligible for a portion of shared savings revenue when quality and cost outcomes are higher than CMS benchmarks for an episode of care.

BPCI-A participants should use quality and shared savings incentives in creating a value- focused physician compensation and incentive distribution model that incorporates goals in quality, patient outcomes, resource utilization and other objectives critical to success under the model.

Participants also should design and finalize their physician incentive distribution model before or very soon after initiating a bundle. Early action is important because modifying physician compensation typically requires input from compliance, legal and human resources areas. Upfront transparency also is critical because incentives affect both private and employed providers.

Physicians will want to know not only “what’s in it for them” financially, but also how the model can benefit patients, the community and the organization. For most physicians, these benefits are as important as personal rewards.

Formal and informal physician influencers also should be included in the design process because of the important role they can play in managing physician expectations and gaining their support. Physician influencers outside the target group can fulfill a number of important roles:

  • Emergency department physicians can manage the need for readmissions.
  • Hospitalists can help manage the inpatient stay and avoid unnecessary consults.
  • The post-acute care medical director can ensure post-acute care referrals are for the appropriate level of care and can oversee quality and utilization.
  • Primary care physicians can keep all related care within the bundle network.

2. Involve physicians at key levels of program governance

To succeed under any bundled payment model, healthcare organizations must carefully orchestrate every aspect of care delivery, and they can do so only with strong physician leadership on both strategy and operations. BPCI-A participants should establish two levels of physician-led program governance.

Strategic program leadership. This leadership group should have global responsibility for the organization’s BPCI-A program, setting overall strategy and monitoring performance on specific episodes. On the administrative side, this group should include the CFO and either the CEO or the COO. Clinical representatives should be physician leaders with a deep understanding of hospital processes and patient pathways. Possible candidates, depending on the organization and its goals, include the chief medical officer and chiefs of surgery, anesthesiology and hospital medicine.

Bundle-specific leadership. Each BPCI-A episode should have its own governance group to oversee operations. For example, if an organization is participating in the program for major joint replacement of the lower extremity, the bundle’s governance group might include orthopedic surgeons and support staff.

The bundle-specific leaders will be charged with creating tactical plans to achieve target outcomes, including establishing clinical protocols and evidence-based care pathways. The group also will monitor performance data and adjust operations as needed to achieve goals.

These governance bodies can be either existing value committees or new groups created specifically for BPCI-A. Either way, physician members should have equal voting rights. Strong physician input is required for all decisions involving service-line optimization or care- model efficiency.

3. Provide physicians with valid, actionable data

As scientists, physicians are disinclined to accept a premise that is not strongly supported by data. They therefore cannot be expected to become fully engaged in bundled payment models without first seeing accurate clinical and operational data that demonstrates the benefits to patients. When presenting data to physicians, health system leaders should acknowledge this physician proclivity through the following actions (see sidebar for additional detail):

  • Explain where the data comes from.
  • Ensure the data is risk-adjusted.
  • Tie practice patterns to measures.
  • Involve physicians in selection of data tools.

While they work on their data strategy, healthcare leaders should be mindful of the importance of sharing patient data across the continuum of care, including having systems in place for sharing episode outcomes and quality data with post-acute care providers.

4. Empower physicians to select or design clinical protocols

Standardized clinical protocols are imperative for strong performance under BPCI-A. Evidence-based clinical guidelines, order sets and care pathways allow physicians and other providers to improve the quality of bundles while using resources more efficiently. Protocols and pathways also are key to managing patients through the 90-day post-acute phase of a bundled episode.

The bundle-specific physician governance groups should lead efforts to develop protocols, with the help of key stakeholders from areas such as pharmacy, therapy and other specialties as needed. These multidisciplinary teams should perform two tasks:

  • Review and select existing protocols
  • Research, advance and implement new protocols that target impacted episodes

For example, under physician leadership, a protocol for elective joint replacement episodes should include extent and timing of preoperative ancillaries, patient education, implant choice and surgical tray design, post-operative management, length-of-stay target, consultant minimization and data-driven post-acute care placement.

In addition to being involved in protocol selection and design, physicians should lead the process of implementing the protocols. It is critical that these physicians have a detailed knowledge of hospital operations. Effective implementation is key to facilitating a smooth inpatient stay and transition to the next level of care for patients in a bundled episode.

Once the protocols have been approved for implementation, they need to be embedded into EHR decision support via effective algorithms and decision trees. Physician engagement  is key for this process to help ensure the  EHR is an effective tool for improving  quality process measures, enhancing care outcomes and removing wasteful practices. Physician involvement also is an important means to help alleviate the common problem of physician struggles and dissatisfaction  with EHRs.

5. Ensure physicians understand the importance of accurate documentation

Although bundled payment is a straightforward concept, with BPCI-A and similar models, the details are far from straightforward. Inaccurate physician documentation will likely undercut the organization’s efforts to optimize episodes of care.

For example, BPCI-A includes several cost exclusions. If physicians do not accurately document the MS-DRGs related to excluded services, the additional costs could inappropriately reduce shared savings or even push the organization into the penalty zone. Physicians also need to understand the importance of appropriate ICD-10 documentation, which drives risk adjustment under the hierarchical condition categories (HCC) model.[1]

Physicians understandably do not see documentation as being a core part of their vocation. But when they understand how documentation affects performance under BPCI-A, most will support clinical documentation improvement and related efforts.

6. Use physician scorecards to root out variation

Unnecessary clinical variation is defined as the overuse, underuse or inappropriate use of clinical resources. This variation results in lower quality and higher cost of care, which undermine performance in BPCI-A. An effective way to combat variation is to develop provider-level scorecards for each physician participating in a bundled episode, including providers and/or facilities delivering post-acute care services in the episode.

Scorecard performance should be monitored by appropriate bundle-specific governance committees. Well-designed physician scorecards make it possible to track expected behavior changes in a way that allows clinical and executive leaders to easily grasp the significance of the changes. Physician scorecards also allow for peer comparisons that promote transparency, friendly competition, and improved processes and care delivery.

Scorecards should focus on measures that physicians can affect through their own efforts to improve performance. Typically, these measures will be a combination of quality, utilization and cost measures aligned with the key performance indicators (KPIs) for each BPCI-A bundle. The governance committees also may want to measure adherence to clinical protocols.

Just as physicians should lead the development of protocols, it is imperative for them to be involved in development of the underlying data used in the scorecards. Physicians should participate in decisions about what is measured, how it is displayed and how the scorecards evolve over time. When scorecards consist of objective and transparent metrics identified and approved by physicians and executive leaders, they are most likely to be fully accepted as valuable assessments of performance.

Examples of effective physician scorecard and operational dashboard metrics include:

  • Average cost per case
  • Per-member-per month spend
  • Various HEDIS and AHRQ quality measures
  • Hospital-acquired conditions
  • Payer contract measures for value-based care
  • Excess days per discharge
  • Emergency department utilization
  • Readmission rates
  • 24-hour to 48-hour gaps in orders
  • Numbers of unrelated procedures
  • Clinical documentation improvement query response times
  • Case mix index
  • Denial rates
  • Mortality rates

7. Let physicians manage physicians

As BPCI-A participating organizations track physician performance in a program, they are likely to detect performance variations among the physicians involved in a bundle. As part of initial governance design, apart from strategic and operational decisions, the organizations need to develop policies and processes for managing poor physician performance. The encounters with physicians who are falling short of performance targets should be managed in a spirit of collegiality with a focus on tightening processes and protocols to eliminate or discourage unnecessary clinical variation. Whatever processes are developed, it is critical that the performance reviews be led and managed by physicians themselves.

Bundle-specific governance groups should meet regularly (preferably monthly) to review unblinded performance metrics. Key metrics to review might include bundle-specific patient volumes, average length of stay, unexpected readmissions and ED visits, and clinical protocol utilization rates. If data shows individual physician performance is outside of control limits, a focus review may be helpful.

Again, the discussions should be led by physician executives. In some instances, individual physicians who are not meeting expectations should be allowed to explain performance deficits in a more private setting. An improvement plan and monitoring program should be decided upon quickly, and two physician leaders for the bundle should be identified to coordinate with management throughout the plan’s implementation.

Elements of success

The common denominator of all the strategic steps described here is involvement. At all levels of decision-making for BPCI-A, there is no problem too small or too complicated to justify not involving physicians.

The ability to vote, be a part of the process and own the results will build tremendous satisfaction among physicians involved in a BPCI-A initiative. It also will create an environment of transparency that fosters trust and collegiality between physicians and administrative leaders. In short, involving physicians deeply in program leadership is the best way to ensure they are fully engaged in efforts to improve quality, costs and patient outcomes. 

[1]  For an in-depth discussion of HCCs, see Smith, D., and Moore, L.G., “The role of HCCs in a value-based payment system,” hfm, October 2017.

About the Authors

Douglas Ardoin Jr., MD, MBA

is managing principal, Lumina Health Partners, Chicago
(dardoin@luminahp.com).

John Malone, MOD

is principal, Lumina Health Partners, Chicago (jmalone@luminahp.com).

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