Urologists who are members of LUGPA are doing the right thing by being part of large group practices. But are they participating in these practices as effectively as possible, through strategic collaboration and sub-specialization? That was the question posed during LUGPA’s annual meeting by Steve Berkowitz, MD, founder and president of SMB Health Consulting.

During his presentation, Berkowitz suggested that the biggest potential adversaries in practices are not the Affordable Care Act (ACA), Congress, or managed care, but the groups’ own doctors. They are crucial players when it comes to determining a practice’s success because they affect how well the group is integrated clinically and financially, and whether the practice has the right infrastructure and governance in place.

Healthcare change is governed by what is mandated; the market takes care of the rest. Patient outcomes and metrics, transparency, and patient experience are part of the natural evolution of the healthcare sector, he said, and would have become a focus with or without the ACA.

Today’s practice environment may not be what doctors signed up for, Berkowitz said, but change is coming anyway. Here are some of his suggested ways to stay ahead of the game:

On the clinical side, the goal is population management. More and more consumers are making decisions on the basis of value. Just as consumers look to sources such as Consumer Reports before they buy a car, they look for data and reviews on doctors, Berkowitz said.

“The data is significant, whether it’s significant or not,” he said. The consumer isn’t asking how many of the respondents are disgruntled patients or how many total respondents there were; they are simply looking at the numbers of stars next to a doctor’s name.

The good news is that medical practices improve when data are reported publicly. If doctors are judged on readmissions, patient satisfaction, wrong-site surgeries, and never events, care just gets better, he said.

“That’s why your goal has to be 100 percent” on core measures, he said. “It’s not enough to just get better. Your competitors are all getting better.” Groups should have regular meetings with all members in which data are shared and each member educates the others on what’s working.

Best practices should be at the heart of those discussions. Berkowitz pointed to the American Urological Association’s most common clinical scenarios for urology, and challenged doctors gathered at the Drake Hotel to ask themselves whether they are following best practices in each of those areas.

Doctors can take a note from pilots, who are good at embracing checklists and guidelines, he said. While pilots and copilots often have never met each other, each knows what the other will do in an emergency situation.

Performance issues increasingly will be tied to reimbursement, most immediately through the value-based program run by the Centers for Medicare & Medicaid Services, Berkowitz noted. Penalties for inefficiency will start at 1% in 2015, but may hit 12% by 2021, he said.

“Who in this room wants to risk 12% of their salary in the next 8 years?” Berkowitz asked.

Managing costs and bundling payments will involve taking risks where they make sense, so that doctors don’t have to take a pay cut, he said.

Doctors throughout each group should know the costs for an episode of care or for a particular diagnosis and have protocols in place, which should be laid out with data in a public forum, he said.

Berkowitz encouraged practices to take a look at who’s doing what as more practices begin to offer a full array of services to larger communities. Doctors who do more of one procedure may be experts in that area, and it might make sense to have them do all such procedures for the group, he said.

Doctors working in population-based medicine will need to ask these questions, he concluded: “What is our need in the community? What is our capability as a group? And then how do we start practicing more in line [with those factors]? Every one of us will have to give up something to some degree.”

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Urologists who are members of LUGPA are doing the right thing by being part of large group practices.

Collaboration in Groups Improves Care, Averts Pay Cuts

Just days after the November 4 midterm election results were announced, Robert Laszewski, president of Health Policy and Strategy Associates Inc, in Washington, DC, told urologists to expect even bigger changes in reimbursement and payment models than they had originally anticipated—but that large-group practices would be especially well equipped to handle them.

While Laszewski said the Affordable Care Act (ACA), which is driving many of the changes, may end up being altered, he doesn’t expect the program to be disbanded due to the political shift in legislative power.

“The majority want it fixed, not repealed,” he said in a keynote address during LUGPA’s annual meeting. “What there will have to be is a bipartisan compromise.”

Under the ACA, a cost-cutting move by health insurers to narrow their networks—or limit the number of participating providers&mdash; is continuing, Laszewski pointed out.

A Robert Wood Johnson Foundation study of narrow network plans studied six states (Colorado, Maryland, New York, Oregon, Rhode Island, and Virginia) to check the prevalence of narrow networks.

 In four of the states, individual market insurers modified networks in advance of 2014. In the other two (Maryland and Rhode Island), at least some insurers have narrowed networks to prepare for 2015.

As they focus on the price of their plans, insurers are making more “sweetheart deals” with provider organizations, Laszewski said, and providers are making conscious decisions to join forces with insurers who might, for example, exclude their competitors. Laszewski said insurers want to work with the most organized large-scale providers. His advice to doctors gathered at the Drake Hotel: “Be sure, as your accountable care organization (ACO) negotiations are going on, that you know you have enormous bargaining leverage. Don’t be shy about that. You’ve got what they want.”

He noted that Medicare Advantage programs are also focusing on narrow, high-performance networks. As a result, those networks are narrowing, by some estimates, by 10% to 15% per year. When they look for the providers who offer the highest ratings in quality and cost, they, too, will be looking at large-group practices, Laszewski said.

“When you have negotiations with Medicare Advantage providers, you need to show them how you can improve their quality ratings,” he said.

Large group practices will also have the upper hand when it comes to the implementation of ICD-10 coding, or the 10th Revision of the International Statistical Classification of Diseases and Related Health Problems, set to take place on October 1, 2015.

While insurance companies, hospitals, and large practices are ready and have been for some time, small practices are not, Laszewski said.

“Small practices just can’t live in the new world,” he said. “They can’t get their systems up to date. It’s another reason why you need to consolidate or be consolidated.”

Looking ahead, Laszewski warned the doctors not to be discouraged by reports showing that savings, so far, have been small in ACOs. A recent Medicare Payment Advisory Commission report found that aggregate savings for 114 ACOs since 2012 was 0.3%.

 But the process will take time, he said, because the investments and expenses are up front, and because a lot of return can’t be expected in these early years. Laszewski urged his audience not to interpret slow results as a sign that the payment model won’t last.

“Let me be clear. The train has left the station to end fee-for-service,” he said. “Republicans and Democrats, and particularly Republicans, believe that markets are the solution, and they mean integrated care. If we don’t make this work, everyone in this room will be working for the government. We will make this work because we have to make this work.”

His advice to urologists given the new economic realities: Be proactive. Pick your partners up front, rather than waiting to be picked. Primary care providers may be driving the ACOs, but they still need specialists. Look for the ACOs that have the patients you want.

“They’re going to want to work with specialists who want to play the game and not undermine their strategies…You have to say, ‘I get it. I know what my role is,’” Laszewski said.

			Colette S, Lucia K, Ahn S. Implementation of the Affordable Care Act: cross-cutting issues. Six-state case study on network adequacy. Robert Wood Johnson Foundation. http://tinyurl.com/qaxea28. Published September 2014. Accessed November 24, 2014.

			Glass D, Stensland J. Update on Medicare accountable care organizations. Medicare Payment Advisory Commission. http://tinyurl.com/n35xbbh. Published September 11, 2014. Accessed November 24, 2014.

While Laszewski said the Affordable Care Act (ACA), which is driving many of the changes, may end up being altered, he doesn't expect the program to be disbanded due to the political shift in legislative power.

Large Groups Are Positioned Well in New Healthcare Arena

Entrepreneur James Feldman, chief innovation officer of the Chicago-based company Shift Happens!, calls himself “a doctor for business.” He offered urologists gathered at the 2014 LUGPA Annual Meeting a prescription for forward movement.

Just as a customer may say price is not an issue when paying for the best shoeshine in town, patients need to know that their urologists are offering them something they can’t get anywhere else, Feldman said. 

“It’s not that you want to be the best at what you do,” he said. “You want to be the 

: Take a note from the movie business, where customers pay before they see the film, Feldman said. In some cases, Medicare/Medicaid payments can take 90 days, and if coverage is canceled in the meantime, the doctor is on the hook to chase down payment from the patient.

: Share that information with employees and let them know what it takes to succeed, he said. If you have an employee who’s doing an exceptional job, pay him or her more. It beats the cost of having the employee leave and needing to retrain someone.

: “If you don’t know how to do it, ask your grandkids. If you are not on Facebook and Twitter and LinkedIn and everything else, you are missing a huge opportunity that could also derail your practice,” he said. According to Pew Research Center, social media adoption rates for those 65 and older have tripled from 13% in the spring of 2009 to 43% in 2013. Social media can also help you remind patients to come to an appointment, or to take their medicine.

Engage people through their mobile devices: 

Call to follow up after an appointment, just as your family’s veterinarian does.

. Feldman said that adding his middle initial, “D,” to the search moved him to the number-one listing. “You have to be memorable,” he said.

The bottom line is change. Patients expect it. “You have to stop business as usual and start innovation as usual,” he said.

Entrepreneur James Feldman, chief innovation officer of the Chicago-based company Shift Happens!, calls himself "a doctor for business."

To Succeed, Urology Practices Must Change With the Times

Urologists hear quite a bit about risk from the legislative and regulatory angles. But they should also be aware of a third risk arena: the enforcement side, said attorneys from Katten Muchin Rosenman in Washington, DC, during a presentation at the 2014 LUGPA Annual Meeting in Chicago.

Howard Rubin, JD, LUGPA’s legal counsel for the past 5 years, addressed some of the triggers that can bring heightened scrutiny on a practice, especially in light of recent examinations of healthcare spending, including US Government Accountability Office (GAO) reports on overuse of services.

Joshua Berman, JD, said the scrutiny has intensified in scope and method.

“They’re coming to your door, they’re coming to your houses…They’re coming to speak to your professional staff, not just physicians,” Berman said. “This is a highly orchestrated strategy from the Justice Department.”

Rather than focusing just on hospitals, the scrutiny is trickling to the individual practice level in an effort to find HIPAA violations, data breaches, and Stark law payment and referral violations, he said. These inquiries come from agencies including the FBI, the Federal Trade Commission, the Department of Health and Human Services, the IRS, and state and local licensing agencies.

Investigators may approach staff who don’t necessarily know which information they should disclose, so training is important, the attorneys said.

Too often, physicians are reactive when, had proper procedures been in place, problems could have been averted, said Glen Donath, JD.

One area that can lead to trouble is inadequate internal practices for resolving disputes, he said. That’s problematic because, without those practices, disputes tend to get communicated through emails and documents. When people feel there’s no process in place for venting their concerns, that can create acrimony and tension and motivate whistleblowers, Donath said.

Many practices also lack a clear compliance plan, or created one years ago and haven’t reviewed it since. In making a case against a practice, prosecutors can point to a compliance plan that staff may not know about or follow.

Rubin urged the group gathered at the Drake Hotel to prioritize finding their practice’s compliance plans and reviewing them with staff. “We can’t emphasize this enough,” he said.

Another important document to locate and review is a practice’s document retention plan.

“When an investigation or a subpoena happens, the first thing the government attorney or prosecutor asks for is a copy of that plan, because that indicates the desire to be compliant,” Donath said.

A document retention plan allows for regularly scheduled deletion of and purging of nonessential emails. That means it allows for the deletion of “ticking time bombs,” or ill-advised emails about compensation or profit and revenue projections that, in the wrong hands, could be used against a practice, Donath said.

But it’s not just electronic communication that can get a practice in trouble, Berman said. An investigator can pull aside someone from a billing department, or another non-physician, who might share information inappropriately if disclosure policies aren’t in place.

The attorneys summarized best practices in the event of an investigation:

		Make sure you have a written document retention plan. Investigators will ask both whether the plan exists and whether it’s being followed. “What you don’t want is investigators coming with one set of questions and all of a sudden morphing into a much more aggressive investigation,” Donath said. He noted that a practice being investigated must suspend any deletion of documents. The length of time for keeping documents varies by practice, but 30 to 45 days is common.

		Educate your staff, starting with the receptionist or the first point of contact, on protocols in case an investigator comes knocking. Let these employees know their rights regarding speaking to investigators, and make the name and contact information of the practice’s legal counsel widely known at all affiliated offices and surgery centers.

		Have a media plan in place. If a member of the media calls, who is authorized to speak and how are those requests handled?

Rubin said that, in this environment of heightened scrutiny of individual practices, a disgruntled former partner or employee can bring a false claim and find the government particularly willing to listen.

“Market competitors are writing letters to the US attorney’s offices trying to gin up issues,” he said. “I wouldn’t have said this a year ago.”

Urologists hear quite a bit about risk from the legislative and regulatory angles. 

Government Come to Call? How to Protect Your Practice

Bryan N. Becker, MD, MMM, put the magnitude of the change in perspective with a question: “Why are we the only industry that has not changed its delivery model in more than 75 years? We’re trying to take care of more people…and sicker people in the exact same way we did it in 1930.”

Changing that model will be difficult and disruptive, he said, but recognizing the size of the change and developing a plan for managing it will be keys to success in large urology group practices.

Becker, associate vice president for Hospital Operations at the University of Illinois Hospital and Health Sciences System, outlined strategies in a talk during the LUPGA 2013 annual meeting in Chicago:

 Becker cited a “rule of 8,” meaning that information should be communicated eight times, whether written, spoken, tweeted, posted, or via combinations of those modes. The repetition increases the chances that information will be heard and retained.

 Stepping back and taking a different vantage point allows practice leaders to see patterns and sequences, putting events in context. In looking at the big picture, Becker added, leaders must recognize challenges related to the way support staff perceive changes in workplace values and power. This can involve responsibilities as mundane as who controls the telephone, he noted.

 Physicians should clarify challenges in their own minds so they can convey them clearly to staff members. At the same time, practice leaders should better define challenges by seeking additional perspectives. They must consider potential conflicts such challenges will bring up, potential winners and losers in the organization, and “festering issues” within their practices that could get in the way of desired outcomes.

 Instituting change means asking people to do things they don’t want to do. Physicians and practice coordinators, as leaders, should aid staff members by making their environment a safe and non-judgmental place in which to ask questions and raise issues.

 “Some people will fly; some people will fail,” Becker said. “But you need people who will get you where you want to be.”

 They are the future leaders, and should not be bogged down with minutiae.

 Staff will burn out under unrelenting pressure, and there will be rebellion. Staff will feel comforted when they see that their leaders have periodically lowered the heat and are willing to take on some of the change.

 Some staff members will see that practice leaders are willing to take on some of the work, and will be happy to let them do so. Leaders can gently point this out, and then determine whether these staff members are incapable of doing the work, or are avoiding it.

 As leaders of change, physicians must be comfortable laying out a vision and then delegating work to those capable of doing it; looking to others for creativity; and encouraging staff members to solve problems on their own.

Changing that model will be difficult and disruptive, Becker said, but recognizing the size of the change and developing a plan for managing it will be keys to success in large urology group practices.

Leading Community Urology Practices Through Change: Hospital Administrator Outlines a Series of Key Strategies

Many community-based medical practices are being acquired these days by hospitals that are working to build a steady stream of patients and grow market share.

In many cases, the practices go along with the trend because they don’t consider themselves entrepreneurial and believe that acquisition will make their futures more secure.

But hospitals are facing a number of challenges to sustainability themselves, and there are strategies besides absorption that private practices can utilize to prepare for successful futures, said Josh Halverson, of ECG Management Consultants in Plano, Texas, in an address to urologists at LUPGA’s annual meeting November 8.

As they acquire practices, hospitals are especially interested in adding high-revenue services, primarily “hearts, heads, and cancer,” to help subsidize some of their other, lower-revenue service lines, and they may see adding a prominent cardiology group practice, for instance, as a way to do that, Halverson said. Consequently, more than half of US physicians were employed by hospital systems or integrated delivery systems as of 2011, according to an article published in the 

But hospital sustainability is facing some challenges—first among them an overall change in strategy.

“Hospitals historically have been glorified hotels; hospital administrators have been trained to optimize their bed capacity,” Halverson said. However, the business model to keep the beds as full as possible is fundamentally changing.

Now, hospitals that previously had little financial incentive to monitor what happened to patients after discharge are being penalized for readmissions. Some will lose up to 3% of their Medicare reimbursement totals in 2014 if they have too many patients readmitted within 30 days, Halverson explained. He added that there are incentives for all providers to keep less-acute patients out of the hospital, and that accountable care organizations and risk-based budgeting systems are moving in.

As models shift, the amount hospitals lose when they acquire physicians is growing, Halverson said. Making the transition from private practice to hospital management takes time, and those early years result in lost revenues for hospitals.

About 4 years ago, the loss per doctor absorbed by a hospital was $140,000, Halverson said. Last year, that loss had grown to $180,000 per physician. Healthcare systems are struggling with these losses as they add thousands of physicians, he said

In the past, the strategy had been that the losses would be offset years later by additional patients. But hospitals are not seeing the revenue streams they had anticipated when they contracted with those physicians, Halverson said, putting intense pressure on them to recapture the losses.

“The first place they go is physician compensation,” Halverson said.

Meanwhile, hospitals are operating in a period of uncertainty regarding reimbursement as insurers consolidate. Hospitals are also being forced to update facilities and services to raise patientsatisfaction scores. They have to spend more money to avoid readmissions just to retain their previous level of reimbursement.

In addition, profit margins are being compressed for previously high-profit specialties such as cardiology, Halverson said.

“The first place Medicare is looking in terms of reimbursement changes is in cardiovascular care. Medicare has significant incentive to reduce the utilization of cardiovascular services,” he said.

So how do practices stay independent in such an uncertain climate? Halverson described three models:

		Federated (pod-based): These practices have limited central government and management, and shared services.

		Integrated: These groups have strong central governance and management and shared services without true financial integration.

		Multi-specialty: With a common governance and management, these practices are characterized by centrally controlled policies and finances.

Practices are moving away from the federated model, Halverson said, because it’s expensive without much coordination of government and management. The market is showing that integrated multi-specialty group practices with a shared vision are the most likely to be successful under a value-based reimbursement structure.

Halverson listed some characteristics of high-functioning practices:

		A strong vision or culture binds members together.

		Members delegate decision-making to a governing entity accountable for making the best decisions for the group.

		Decisions are made with a principle-based approach.

		There is a clear line between governance and management.

		The right people are in the right jobs and are accountable for making decisions.

		Performance measures are clearly defined, routinely reported, and monitored regularly.

		Skill gaps are addressed through training and mentorship.

		Members of the leadership team are professionally trained in management, operations, and strategy.

		There are opportunities for advancement for high performers, and low performers are reassigned or eliminated.

		Business practices are reviewed routinely.

		Physician compensation is recognized as the biggest expense of the group.

		Compensation is tied to the economic realities of the practice.

Medical groups with these qualities, and who succeed in managing patient populations together, will have a strategic advantage in an uncertain future, Halverson said.

Hospital Acquisition Avoidable for Urology Practices

As fee-for-service models dwindle under healthcare reform, new reimbursement models based on risk are emerging.

Under budget-based payment systems, physicians’ pay is tied to their ability to successfully predict how much a particular population will use their services in the future, as well as how much it will cost to deliver those services. Success under these models depends on making sure the actual healthcare expenses of patient populations don’t surpass the budgeted amount.

The trend has been evolving in recent years, said healthcare attorney Catherine Hanson of law firm Whatley Kallas, in San Francisco, during a November 8 presentation to LUGPA annual meeting attendees. From 2005 to 2012, significantly more Medicare claims were filed, but the number of allowed charges dropped. Instead, she said, income has become dependent on management of the healthcare pie, a total $3 trillion in annual expenditures of which physician payment constitutes about 20%.

Budget-based reimbursement systems include models ranging from capitation—where physicians get a set fee and assume all the risk&mdash;to shared savings and bundled payments. All are designed to give incentives for value rather than volume.

Hanson noted that single-specialty and multi-specialty group practices are the highest-paying places for urologists in the United States. However, because the money is no longer in fee-for-service models, physicians must make several changes to maintain and grow salary levels, she said.

 Getting patients more engaged in their own health care means helping them with weight issues, lifestyle choices, and medication management.

 Physicians should get more involved with those who refer patients to them, helping to determine when this is appropriate. Upon receiving referrals, they must determine how to manage communications back to their teams to eliminate duplication of services and unnecessary hospitalization.

 Differences in health care costs are sometimes arbitrary. Because reimbursement is based on total costs, comparing the prices of laboratory and other services used by physician practices becomes more important.

 Moving into the new ICD system will require careful attention and preparation. “You have to make sure things are coded and paid for, or you will go bankrupt,” Hanson said.

In taking care of a patient population, it’s important to know that the top 1% in the healthcare system spend 20% of the healthcare dollars, or more than $44,000 per patient per year, she said, citing Kaiser Family Foundation calculations based on data from the Health Care Research and Quality Medical Expenditure Panel Survey of 2008. The bottom 50% spend only 3% of healthcare dollars, or less than $1,000 per patient per year.

Hanson used an example from endocrinology, in which the average cost of treating a diabetic patient was $556 per episode, according to DxCG Risk Solutions data. That cost ranged from $354 (stage 1 or least sick) to $1,604 (stage 3 or most sick). So a practice that had a large percentage of the sickest diabetics would be quickly out of business if its utilization budget was based on the average $556.

That doesn’t mean that physicians should limit their treatment of sicker patients, Hanson said, but that they should project accurate budgets based on the health status of the patients they are most likely to see.

“We don’t want a system that benefits cherry-picking patients. We want a system that rewards those physicians who take in people who need care and manage that care well,” she said. “If all you see is prostate cancer, the odds are high that the risk of your population is higher. You have to understand what your patient population looks like. You then have to understand what the likely utilization of that population is going to be.”

Urologists must not just know what they are charging, but what it actually costs to deliver services and make referrals. And they will need expertise in mitigating insurance risk, Hanson said.

“There’s always going to be a train wreck, but the train wreck is really not your problem,” she said. “The train wreck is something you insure against. The place you make money is by managing that total population well.”

The need to reach that goal places a new level of responsibility on all physicians to use new technology and patterns from the past to predict the future. As daunting as the task may seem, physicians are uniquely positioned to make those changes, and many practices “do phenomenally well” under budget-based systems, Hanson said.

“Physicians are in absolutely the best place to reengineer health care and to succeed under these new payment models,” she said. “Let’s face it—you know what patients need, you know where the waste is, and you’re more nimble [than a hospital system].”

Marcia Frellick