Aligning Physicians with Service Line Performance

Transcription

1 Aligning Physicians with Service Line Performance An AMGA Webinar Presented by: Navigant and Sentara Healthcare July 16,

2 Navigant Presenters James M. Palazzo, MBA» Jim is a Managing Director with a focus in healthcare transactions, facilitation of hospital-physician integration, development of next generation governance and decision-making models, Centers of Excellence/Service Line planning, contemporary physician compensation design, alignment strategies, market differentiation strategies, market and competitor profile analysis, and general healthcare strategy and transformation work. Kevin Wilson, MBA, AVA» Kevin is a Managing Director and has approximately 20 years of healthcare management and strategic consulting experience. During his consulting career, Kevin has provided consulting assistance to more than 100 health systems, hospitals, medical groups, and academic institutions. Kevin s primary focus has been his work to create and enhance physician-hospital relationships and alliances, so that they are better able to succeed in increasingly competitive markets. Page 2

3 Sentara Healthcare Presenters Joseph T. Butz MBA, JD» Joe is a Senior Divisional Vice President for Sentara Healthcare, a 12-Hospital Health System located in Virginia and North Carolina. His responsibilities encompass managing the operations of the Sentara Heart Hospital ranked among the Top 50 Cardiac Facilities in the Nation by U.S. News & World Report, and strategic operations for the Cardiac Service Line, including project management, budgeting, resource allocation, and strategic planning. Benjamin S. Smalley, MBA, MHA» Ben is a director at Sentara Medical Group, a 600-provider multispecialty group within Sentara Healthcare. He works with medical group and hospital leadership to implement initiatives that improve access, quality, and efficiency in both inpatient and outpatient settings. His responsibilities include performance of 34 co-management metrics, patient satisfaction, budgets, operations, quality, project management, and strategy. Page 3

4 Learning Objectives 1) Use governance/decision-making models to engage physicians in service-line performance. 2) Review methodologies to engage physicians in service-line performance. 3) Align physician activity around defined metrics. 4) Connect service-line strategy with operational efficiency. 5) Evaluate integration of service-line, single-specialty and multi-specialty groups. Page 4

5 Stages of System Development Asset Aggregation Functional Integration System Optimization HUMAN RESOURCES FINANCE IT DECISIONS Growth as the strategy Aggregate units Holding company BILLING MANAGEMENT SUPPLY CHAIN Non-clinical functions Generating cost savings Managed care contracting Clinical integration Migration of decisionmaking from units to core Service-line leadership at the system level Degree of Integration and Complexity - Different skill-sets required at each level Page 5

6 Benefits of Effective Governance Establish, promote and implement the service-line Vision Promote efficient (fast) and effective (right) decision-making Draw upon the leadership strengths of the whole enterprise Lead the regional marketplace, rather than follow the marketplace Develop consensus (not necessarily unanimity) among the constituencies Promote creativity and innovation, and provide opportunities for participation and buy-in Promote discipline towards the System and service-line vision Page 6

7 Components of Service Line Enterprise Expanded Development of CV Services Line supported by integrated and affiliated system providers across the entire continuum of inpatient, outpatient and professional services Medical Centers & Inpatient Facilities Other System Outpatient & Ancillary Services Integrated Specialty Practices Other Integrated Specialty Physicians/Providers Other Non-Employed Physicians/Providers Page 7

8 Dyad Leadership Service Line Leadership Physician Administrative Representatives Include: Programmatic Physician Leadership Select Corporate Ops Leaders Other Shared Resources Others - TBD Executive Committee Chaired by MD and Admin Leaders Responsible for: Strategy Development Growth / Outreach Efforts Recruitment Priorities Finance Operations Clinical Integration Quality & Safety Patient Experience Performance Reporting and Monitoring Financial Review Budget Planning/ Forecasting Practice Operations Review / Staffing IP Operations (LOS, cath lab efficiency, OR Utilization, etc.) Serve as Cardiac Committee for CIN Care Redesign Care Coordination Inpatient Quality review Ambulatory metric review Patient Access Satisfaction Measures (IP & OP across continuum) Cost of Care Review Page 8

9 Function & Operations Matrix Checks & Balances, qualifications for service, written governance document Align Service-line strategy with that of the System, system and service-line strategies to complement one another Funding priorities, enterprise accounting, development of user-friendly financial reporting and publication Cost efficiency, COE management by multi-disciplinary teams, operation to flow from strategy and budget Best clinical practice, patient experience, plan to advance service offerings Establishment of quality, efficiency, and access metrics; effective monitoring of metrics; align compensation Distilling data into confidently actionable intelligence that allows for decisive action Facility, equipment, and IT utilization and deployment Governance Service Line Strategy Budget Operations Quality Performance Business Intelligence Asset Management General Cardiology Congestive Heart Failure/VAD/Transplant Coronary Interventions Electrophysiology Structural Heart Disease/Valve Management Vascular Diagnostics & Intervention/Surgery Centers of Excellence Page 9

10 Service Line Decision-Making Authority Matrix Key Parties / Decision Issues System Leadership Service Line Leaders Executive Committee Sub- Committees Programmatic Leaders Practice Leadership Participating Physicians Approve initial committee structure Appoint committee members Selection /Removal of physician leadership (Medical Directors) Selection/Removal of service line operational support leadership Develop/Approve Service Line Strategic Plan Develop/Approve Service Line Operating and Capital Budgets (Enterprise Wide) Authority Matrix Key: A = Approve; R = Recommend; I = Input; D = Delegate Page 10

11 Service Line Decision-Making Authority Matrix (cont d) Key Parties / Decision Issues Develop/Approve Programmatic Business Plans Develop Long Range Goals and Performance Targets Develop/Approve Service Line Medical Staff Development Plan Identify Programmatic Outreach Areas Approve/Discontinue Service Line Clinical Programs System Leadership Service Line Leaders Executive Committee Sub- Committees Programmatic Leaders Practice Leadership Participating Physicians Approve/Modify Quality Metrics and Clinical Performance Standards Authority Matrix Key: A = Approve; R = Recommend; I = Input; D = Delegate Page 11

12 Sentara Governance in Cardiac Service Line As Part of Multi-Specialty Medical Group Hospitals with Cardiac Programs Medical Group Rockingham Martha Jefferson Northern Virginia Williamsburg CarePlex Leigh Memorial Virginia Beach Princess Anne Norfolk General Cardiac Joint Operating Committee Cardiac Practice Management Committee Vascular Neurology Surgery Pulmonary Cardiology Internal Medicine Family Medicine Pediatrics Musculoskeletal Obici Hospital Medicine Page 12

13 Sentara s Governance Focuses on a Variety of Needs Improving office and hospital efficiencies Creating new outreach access points Developing innovative services Improving and standardizing quality care Hiring new Physicians Page 13

14 Governance Committees at Sentara Heart Joint Operating Committee (Strategy) Duties: Capital/Operating Budgets, Quality, Program Development, Personnel Recommendations, New Providers, IT needs Collaborative Duties: Strategy, budgets, new locations, recruitment, comanagement Cardiac Practice Management Committee (Operations) Duties: Implementation of JOC initiatives, day-to-day operations, execution and monitoring of Co- Management Metrics Page 14

15 Physicians have an equal representation on strategy and majority on daily operations Joint Operating Committee (Strategy) 50% Physician Members 50% Administrative Members - 3-year terms - Chair alters between physician and administrator each year Physician Members Admin. Members Executive Medical Director Cardiac Practice Management Committee (Operations) 70% Physician Members 30% Administrative Members Non-voting: Operations Director Executive Medical Director Page 15

16 Strategic Opening of Outreach Clinic Vision for a New Clinic Provide both general and subspecialized cardiac services Create local access for patients who are geographically separated by tunnels Decrease hospital readmissions Challenges Employed physicians live far away wrvu compensation model would cost physicians to open Solutions wrvus subsidized for first 24 months Reports to Joint Operating Committee on outcomes of outreach Page 16

17 CURRENT Data Source: Aligning the 2015 Budget Across Sentara Heart s Service Line Hospital Historical Volume SMG Historical wrvu Input: Physician Input Market Data Practice Directors System Budget: Hospitals Administrators Medical Group Leadership Hospital/Clinic: A B C D E A B C D E F G Page 17

18 Aligning the 2015 Budget Across Sentara Heart s Service Line CURRENT Data Source: Hospital Historical Volume SMG Historical wrvu Input: Physician Input Market Data Practice Directors System Budget: Hospitals Administrators Medical Group Leadership Hospital/Clinic: A B C D E A B C D E F G FUTURE Hospital Historical Volume SMG Historical wrvu Use of Ratios to Identify Ambulatory Impact on Hospital Physician Input Market Data Hospitals Administrators A B C D E Practice Directors Medical Group Leadership NEW CLINIC C D E F G Page 18

19 Sentara Cardiac Service Line Rollup GROSS CARDIAC REVENUE: HOSPITALS CONTRACTUALS AND BAD DEBT HOSPITAL SALARIES HOSPITAL SUPPLIES HOSPITAL SUPPORT SERVICES STRATEGIC PHYSICIAN INTEGRATION INVESTMENT CARDIAC SERVICE LINE MARGIN Page 19

20 ALIGN INCENTIVES THROUGH COMPENSATION & METRICS 20

21 Evolution of Compensation Models Salaries and Guarantees Base Plus Productivity Revenue Less Expense Pools Pure Productivity Productivity Plus Incentives Large Percent Based on Outcomes Early 1990 s Late 1990 s Early 2000 s Late 2000 s Today Next Generation» Today: largely productivity-plus-incentives, including: wrvu-based system Guarantee or floor only for: Transition period New hires Relative small quality/efficiency/outcomes incentives (10-15%) Plus medical administrative and other non-clinical or revenue producing time credit Page 21

22 Next Generation Compensation Models Significant percentage of income will be allocated based on measurable clinical outcomes and quality/cost indicators. This will vary by market and payer contracts. Various compensation streams, including clinical care, service line management, and participation in system-wide initiatives. Productivity Outcomes Outcomes Productivity Page 22

23 Approaching the Development of Quality Incentives Understand what constitutes superior quality and improvement. Identify key quality metrics for the service line. Obtain industry-recognized benchmark data for metrics. Understand the average or median and top or 90th percentile performance benchmarks. Determine the service finds historical performance of the quality metrics. Develop a schedule whereby historical and national data are outlined in levels of improvement and attainment of top quality are clearly identified. Create an incentive compensation pool and distribution methodology. Review net revenues or funding for the service being managed. Determine the appropriate market rates for improving and achieving superior quality care. Create payment tiers with incentive amounts for improvement over the benchmark average or median, and that compensate higher amounts when the service line is placed in the top tier for quality. Page 23

24 Sentara s Tiered Pool Format in Cardiology Co-Management Potential Tier I: Lump/Split Pooled wrvus of Tier I/II o $X/wRVU Feeds Tier I s Tier II: Employment model Tier I at-risk Outside Pool Tier III: Sentara employs / at-risk Moved to Tier II when at 90% of average or at election of Tier I Page 24

25 Co-Management Metrics Create Alignment Indicator Year 1 Achieved Year 2 Pending Quality (44%) 38% 24% Access (18%) 18% 14% Efficiency (23%) 18% 5% Satisfaction (15%) 15% 5% Bonus (11%)* n/a 3% Total 89% 51% Year 3 TBD * Will only occur in Years 2 and 3 Quality Access Efficiency Satisfaction Door to Balloon Time 97% across the system Sub specialty Extenders (EP & TAVR) In Office on-time starts and no show rates 98% HCAHPS 86.8% System PCI O/E ratio.59 Appropriate use criteria Accreditation Timely clinic access for new patients 100% Program development Fundraising Readmission protocols (CHF) Epic Implementation EMMI implementation 83% Employee Satisfaction Page 25

26 Five Questions On Co-Management Metrics 1) Should metrics be group or individual? Do group goals hide low performers? Do group goals create peer pressure? Do individual metrics create perverse incentives? 2) Are there some goals that are simply expectations as part of being on the team? 3) Can one have too many metrics and dilute the value of individual metrics? 4) Are you delaying important initiatives because you aren t confident in how to accurately measure? 5) Can providers have enough control over the outcome that the metric has value for accountability? Page 26

27 Summary Move your enterprise from asset aggregation to functional integration to system optimization. Align your physicians with the enterprise by focusing first on effective governance and appropriate representation in each committee. Focus your next compensation model on achieving outcomes and less on productivity alone. Leverage the value of integration by budgeting across medical group and hospital silos to create and align system strategies. Choose metrics over which the physicians have some control and be thoughtful in the number of metrics that have incentives attached. Page 27

28 Contact Information Office: (817) Office: (757) Office: (678) Office: (757) Page 28