MDNews - Cleveland-Akron-Canton

May/June 2012

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Evolving Incentives By Ronald F. Pavlovich, CPA, CAPPM A CCOUNTABLE CARE, VALUE- BASED purcha sing and bundled payments are all government programs with the same goal of cutting costs out of the healthcare system. Those same government programs also recognize that physicians are in control of the way a major portion of healthcare dollars are spent. Thus, it is no surprise that physicians and the way they are incentiv- ized in their compensation models is changing to coordinate with cost savings goals of healthcare reform. Most physician compensation models already incorporate an incentive-based component into them. Common incen- tives include pay levels directly related to seeing a higher volume of patients or generating a higher volume of gross billings or net collections. In the business world, growing volume is almost always the base for incentives. So why would we think that in a fee for service healthcare world it should be any different? Thus, physicians have been rewarded for doing more — seeing more patients, ordering more tests, performing more procedures. Doing more has been the way healthcare facilities have functioned in order to meet patient needs and to keep doctors productive. It has been the norm. As we move into the new "accountable care" world of healthcare, these incentives, however, are being blamed as the root of physician behavior that needs to change in order to meet the new directives of delivering better care for more people at a lower cost. These priorities will be difficult to balance, and a key to success will be engaging physicians and gaining their cooperation in establishing new delivery models. No practice will be immune to the pressure to evolve into a system in which value will be at least as important as volume. Qu a l i t y me a s u r e s are growing in value. Providing quality care has always been a focus for both healthcare facili- ties and physicians, but in today's environment of integrating delivery systems, more emphasis is being placed around formal quality-based measures for physician incentive compensation models. With increasing use of EHR, administrators and physicians have access to more and better data to determine measurable quality metrics to be developed and implemented. Subjective measures are being added. Given the increasing focus on the overall patient experience, subjective criteria are being added to many physician incentive models to encourage doctors to work well in a col- l a b or at ive environment and to create a positive in New Physician Compensation Models 40 | Cleveland-Akron-Canton MD NEWS s MDNEWS.COM s MAY-JUNE 2012

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