Posts Tagged ‘PHOs’

PHOs Let Quality, Cost Guide Them Toward Value-Based Reimbursement

April 16th, 2015 by Cheryl Miller

Instead of focusing on volume, physician-hospital organizations (PHOs) are concentrating on value-based care, says Travis Ansel, senior manager with the Healthcare Strategy Group. The once revenue-based organizations are now focused on quality and cost, realizing that if they can’t manage those two things, their reimbursement will go down.

Why is the PHO model going to work now? We always get this question. This comes more from doctors than it does from administrators: why are PHOs going to work now, when they didn’t work before? The simple answer is that before, PHOs were revenue-focused. They were about getting the biggest number of physicians into the model regardless of their quality. It was run by the hospital as a methodology for increasing rates. Then fee-for-service (FFS) didn’t really give anybody the incentive to work together.

They gave everybody the incentive to sign their name on the contract and hope for better rates. What we’re seeing PHOs focus on now is quality and cost, with the idea that if they can’t manage those two things, their reimbursement is going to go down. We have clinical integration guidance from the Federal Trade Commission (FTC), which gives everybody the framework for developing joint contracting capabilities and defines legally how we can work together. What we’re seeing now, since there’s more of a clinical than a revenue focus for PHOs, is that they are more dominated by physician leadership. The hospital keeps control over the purse strings, but gives the governance of the group to physicians. They are letting them take the leadership on the cost and quality protocols that they need to develop to be successful.

There is also the way that payment reform is transitioning the incentives. They’re focused on getting quality and cost across populations or across episodes of care. They’re giving the right incentives for collaboration, which the PHO model provides the forum for.

Source: Physician-Hospital Organizations: Framework for Clinical Integration and Value-Based Reimbursement

Home Visits

Physician-Hospital Organizations: Framework for Clinical Integration and Value-Based Reimbursement describes the relevance of the PHO model to today’s healthcare market, offering strategies to leverage the physician-hospital organization for maximum clinical outcomes, competencies and value-based reimbursement.

Leveraging the PHO Model for Bundled Payment Success

February 5th, 2015 by Cheryl Miller

As Medicare begins its ambitious timeline for moving Medicare payments from volume- to value-based models, alternative payment formulas, including bundled payment arrangements for episodes of care, which CMS has tested in a range of pilots in recent years, will come to the forefront. Here, Travis Ansel, senior manager of the Healthcare Strategy Group, explains why the physician-hospital organization (PHO) provides an attractive framework for bundled payment models.

Bundled pricing is appearing in more and more markets across a number of payors. As I’m sure everyone knows, CMS is testing bundled payment pilots across the country. A number of our clients that have been involved with that have had a reasonable amount of success. Overall, the level of success of the bundled pricing pilot program for CMS leaves one to wonder: is that the future of CMS? Is it some combination of accountable care organizations (ACOs) and bundled payments?

Another interesting program for bundled payments is what’s going on in Arkansas with the Healthcare Payment Improvement Initiative. In this program, the state Medicaid program and Blue Cross have actually worked together to create bundled payments for episodes of care based around high volume diagnosis-related groups (DRGs). The responsibilities for hitting the cost targets in this case are assigned to what they refer to as the “principal accountable provider.” For example, for DRG 470, major joint, the principal accountable provider is the orthopedic surgeon, but the orthopedic surgeon in this case was being held accountable for what goes on in his or her practice.

What goes on before surgery? What goes on during the hospitalization and the surgery, and then what happens 30-90 days post-acute care? They’re being held accountable for care across the continuum. This is relevant to the PHO model, because as this is phased into a number of DRGs—it started with eight, but now it includes quite a few more—the need for a PHO model will bring these physicians together.

PHO Models
Travis Ansel, MBA, is manager of strategic services with Healthcare Strategy Group, LLC. Ansel’s practice focuses on helping hospitals and health systems with physician alignment issues through strategic planning initiatives, such as hospital strategic planning, employed physician group strategic planning, physician alignment planning, and clinical integration. Mr. Ansel holds a master’s of business administration from Vanderbilt University, and bachelor of science degrees in finance and business management from the University of Tennessee.

Source: Preparing for Value-Based Reimbursement Models: PHO Development for ACOs, Bundled Payments and Direct Contracting

Healthcare Business Week in Review: Hospital Readmissions, State-by-State Scorecard, PHOs, HRAs

September 27th, 2013 by Adam Ghosh

It looks like good surgeons are, literally, a cut above the rest, at least according to a new study from Harvard School of Public Health.

Quality surgical care is strongly linked to hospital readmission rates, a somewhat surprising new statistic given that much of policy focus has been on reducing readmissions after hospitalizations for medical conditions, such as heart failure and pneumonia.

Readmissions for medical conditions are primarily driven by how sick the patients are and whether they live in poor or better-off communities; the link between hospital quality and readmissions is less clear. The study sought to find out if there was a relationship between readmission rates after surgery and the quality of surgical care in that hospital; more details inside.

Poor healthcare quality does not discriminate. According to a new study from the Commonwealth Fund scorecard, access to affordable, quality healthcare varies greatly for low and high-income people based on where they live.

The report finds that higher-income people living in states that lag far behind the top scoring states are often worse off than low-income people in states that rank at the very top of the scorecard. The scorecard provides the first state-by-state comparison of the healthcare experiences of the 39 percent of Americans with incomes less than 200 percent of the federal poverty level, and compares their experiences with higher income families.

Lower-income families, particularly those on Medicaid, have grown increasingly more dependent on using the emergency room, despite widely held assumptions that uninsured patients are high ER utilizers, according to a study from the University of California, San Francisco. In order to investigate recent trends between insurance coverage and ED use, researchers analyzed California ED visits by adults aged 19 to 64 years old from 2005 to 2010, and found that the number of visits to California EDs by adults overall increased by 13.2 percent, with Medicaid beneficiaries leading the pack. This study has wide implications with upcoming ACA reforms; many uninsured people are expected to transition to Medicaid, and as a result, overall ED use may increase because Medicaid patients have higher rates of ED use.

Physician-hospital organizations (PHOs) have taken the accountable care organization (ACO) reins from physicians over the last year, according to our 2013 market data. PHO leadership of ACOs almost doubled in the last 12 months; in 2012, one-quarter of ACOs were

physician-led, a trend that replaced the hospital-administered ACOs that dominated in 2011.

As ACOs continue to evolve, the composition of the care delivery model will shift as well, with hospice, long-term care and home health entering the fray.

Lastly, don’t forget to take our Health Risk Assessments in 2013 survey – sophisticated analytics behind today’s health risk assessments or health risk appraisals (HRAs) provide employers, payors and providers an aggregate view of population health and the raw

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