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Jalila Cunningham, MD

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Jalila Cunningham, MD

“Code blue, code blue!”

You are somewhat of a rock star. It’s evident by the fact that most nocturnists are paid a 10% to 20% shift differential. In layman’s terms, you get paid more money than everyone else.

Nocturnist in Charge

Night-Shift Benefits

You have the opportunity to really hone your medical and procedural skills because you are the specialist at 3 a.m.

Even though you won’t be around during the day, you must stay abreast of quality initiatives (CHF, AMI, etc.). Beware of charting requirements, which can change from day to day.

If you are looking for an exciting way of life, and the ability to practice pure medicine after residency, you might want to get “into the night” and consider an HM career as a nocturnist. TH

Dr. Cunningham has been a hospitalist since 2004 and a nocturnist the past three years at Hamilton Medical Center, a community hospital in Dalton, Ga., and locum tenens in the Tennessee area.

“Code blue, code blue!”

You are somewhat of a rock star. It’s evident by the fact that most nocturnists are paid a 10% to 20% shift differential. In layman’s terms, you get paid more money than everyone else.

Nocturnist in Charge

Night-Shift Benefits

You have the opportunity to really hone your medical and procedural skills because you are the specialist at 3 a.m.

Even though you won’t be around during the day, you must stay abreast of quality initiatives (CHF, AMI, etc.). Beware of charting requirements, which can change from day to day.

If you are looking for an exciting way of life, and the ability to practice pure medicine after residency, you might want to get “into the night” and consider an HM career as a nocturnist. TH

Dr. Cunningham has been a hospitalist since 2004 and a nocturnist the past three years at Hamilton Medical Center, a community hospital in Dalton, Ga., and locum tenens in the Tennessee area.

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Carol Pohlig

Hospitalists work in many types of facilities, including academic centers that utilize residents (including interns) in healthcare delivery. Medical and surgical services furnished by a resident within the scope of the training program are covered as provider services and paid by Medicare through direct Graduate Medical Education (GME) and Indirect Medical Education (IME) payments; the services of the resident may not be billed or paid for using the Medicare Physician Fee Schedule.

Similarly, the teaching physician is not paid for the resident’s work. The teaching physician is paid for their participation in patient care. In other words, payment is provided to the teaching physician for services that are:

Furnished by a physician who is not a resident; or

Furnished by a resident with a teaching physician physically present during the critical or key portion(s) of the service.

Teaching physicians participate in evaluation and management (E/M) services with residents in several ways. Consider the following teaching physician scenarios:

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules.

Scenario 1: “Stand-Alone” Service

The resident sees a patient in the morning. The teaching physician independently sees the patient later that same day, performing all required elements to support their own bill (e.g. 99233: subsequent hospital care, per day, which requires at least two of these three key components: a detailed interval history, a detailed examination, or high-complexity medical decision-making). When documenting, the teaching physician can write their own note with or without any of the residents’ information. The attending note “stands alone” in support of the reported visit level. Alternatively, the teaching physician might “link to” the resident note, instead of personally redocumenting the entire service.

Appropriate documentation includes teaching physician notation of the provided critical or key portion(s) of the service and the involvement in patient management. The visit level is based upon the combined documentation, both teaching physician and resident.

Definitions for teaching-physician services

Resident: An individual who participates in an approved GME program or a physician who is not in an approved GME program but who is authorized to practice only in a hospital setting. The term includes interns and fellows in GME programs recognized as approved for purposes of direct GME payments made by the fiscal intermediary (FI). A staff or faculty appointment, or participating in a fellowship, does not by itself alter the status of “resident.” Additionally, this status remains unaffected regardless of whether a hospital includes the physician in its full-time equivalency count of residents.

Student: An individual who participates in an accredited educational program that is not an approved GME program. A student is never considered to be an intern or a resident. Medicare does not pay for any service furnished by a student.

Teaching physician: A physician (other than a resident) who involves residents in the care of his or her patients.

Direct medical and surgical services: Services to individual beneficiaries that are either personally furnished by a physician or furnished by a resident under the supervision of a physician in a teaching hospital. All payments for such services are made by the FI for the hospital.

Teaching setting: Any provider, hospital-based provider, or nonprovider setting in which Medicare payment for the services of residents is made by the FI under the direct GME payment methodology, or freestanding skilled nursing facility or home health agency in which such payments are made on a reasonable cost basis.

Critical or key portion: The part(s) of a service that the teaching physician determines critical or key. In most cases, the terms are interchangeable. —CP

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules. Examples:

“I performed a history and physical examination of the patient and discussed his management with the resident. I reviewed the resident’s note and agree with the documented findings and plan of care.”

“I saw and evaluated the patient. I agree with the findings and the plan of care as documented in the resident’s note.”

“I saw and examined the patient. I agree with the resident’s note, except the heart murmur is louder, so I will obtain an echo to evaluate.”

Each of the above linkage statements is acceptable, and “more is always better.” The last example best identifies the teaching physician’s involvement in patient management and best supports other regulatory goals and quality initiatives of the current healthcare environment.

Scenario 2: “Supervised” Service

The resident and the teaching physician see the patient at the same time. The teaching physician supervises the resident’s performance of the required service elements or personally performs elements separate from those completed by the resident. Despite personal supervision, the attending still must document their presence during the encounter, performance of the critical or key portion(s) of the service, and involvement in patient management. The visit level is based upon the combined documentation.

Medicare-accepted teaching physician statements associated with this scenario include:

“I was present with the resident during the history and exam. I discussed the case with the resident and agree with the findings and plan as documented in the resident’s note.”

“I saw the patient with the resident and agree with the resident’s findings and plan.”

These generalized statements will be accepted for billing under teaching physician rules. However, documenting patient-specific elements of the assessment and plan unequivocally demonstrates teaching- physician involvement in patient care and the quality of care provided.

Scenario 3: The “Shared” Service

The resident performs a portion or all of the required service elements without teaching-physician presence and documents this service. The teaching physician then independently performs only the critical or key portion(s) of the service and, as appropriate, discusses the case with the resident. As in the other scenarios, the attending documents the presence and performance of the critical or key portion(s) of the service, as well as involvement in patient management. The teaching physician selects the visit level based upon the combined documentation of the teaching physician and resident.

Such Medicare-approved statements for use by teaching physicians under this scenario include:

“I saw and evaluated the patient. I reviewed the resident’s note and agree, except that picture is more consistent with pericarditis than myocardial ischemia. Will begin NSAIDs.”

“I saw and evaluated the patient. Discussed with resident and agree with resident’s findings and plan as documented in the resident’s note.”

“See resident’s note for details. I saw and evaluated the patient and agree with the resident’s finding and plans as written.”

“I saw and evaluated the patient. Agree with resident’s note, but lower extremities are weaker, now 3/5; MRI of L/S spine today.”

Regardless of the timing between the attending and the resident encounter represented in each scenario, the teaching physician cannot “link to” a resident note that has not been written. More specifically, if the resident’s note has not been documented at the time the teaching physician writes their note, the teaching physician can’t link to the resident’s note or consider it for billing purposes.

Time-Based Exception

Time-based E/M services (e.g. critical-care services, discharge-day management, prolonged care, etc.) do not follow the same guideline as the standard E/M services, which are selected upon the level of history, exam, and decision-making. Only the billing provider’s time counts toward the reported visit level. This means that the teaching physician must be present for the entire period of time for which the claim is made. Documentation should identify the teaching physician’s total visit time (spent on the unit/floor for inpatient services), including face-to-face time with the patient. Time spent by the resident without the presence of the teaching physician does not count toward the teaching physician’s reported time. Additionally, time spent “teaching” the resident cannot be attributed to the teaching physician’s visit time.

Student Notes

Per Medicare guidelines, students (medical, nurse practitioner, etc.) can document services in the medical record. However, the teaching physician can only refer to medical student documentation associated with the review of systems and/or past/family/social history. The teaching physician cannot refer to a student’s documentation of physical exam findings or medical decision-making.

If the medical student documents E/M services, the teaching physician must verify and redocument the history of present illness, as well as perform and redocument the physical exam and medical decision-making activities of the service. The teaching physician then selects the visit level and documents service. TH

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center, Philadelphia. She is also on the faculty of SHM’s inpatient coding course.

References

Guidelines for Teaching Physicians, Interns, Residents. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/MLNProducts/downloads/gdelinesteachgresfctsht.pdf. Accessed May 6, 2011.

Medicare Claims Processing Manual: Chapter 12, Section 100. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 6, 2011.

Medicare Benefit Policy Manual: Chapter 15, Section 30.2. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/Downloads/bp102c15.pdf. Accessed May 6, 2011.

Manaker, S. Teaching Physician Regulations. In: Coding for Chest Medicine 2008. Northbrook, IL: American College of Chest Physicians, 2008; 279-285.

Pohlig, C. Evaluation & Management Services: An Overview. In: Coding for Chest Medicine 2011. Northbrook, IL: American College of Chest Physicians, 2010; 323-330.

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011.

READER Q&A

CMS Suggests Extended Observation Should Be Infrequent Occurrence

Question: I read the March 2011 “Billing and Coding” article regarding the new CPT codes and have the following inquiry: Often, as a hospitalist, I will get a lot of pushback from our UM reviewers and case managers when observation patients stay longer than 48 hours. This is due to the Centers for Medicare & Medicaid Services’ 48-hour observation policy. It sounds like the CPT is trying to address this issue by creating these new codes and have patients stay longer as observation. This seems in conflict with the goal of CMS to have patients stay only for 48 hours as observation and then be converted to inpatient if they fail 48 hours of observation.

Answer: While the goal of CMS is to maintain a limit of hospital observation services, there seems to be a growing trend of extended observation care (>48 hours) over the past several years. CMS recognizes that there might be extenuating circumstances, which might require an observation stay of more than 48 hours, but suggests that this should be an infrequent occurrence. Typically, the physician is able to determine if the patient should be admitted to the hospital or discharged to home within 48 hours.

Other factors affect observation care services. Only the attending of record can bill for initial hospital care (99218-99220).¹ Prior to Jan. 1, 2010, consultants could provide their services, as appropriate, and report consultation services. With the elimination of payment for consultation services in 2010, the consultant was only allowed to report outpatient/office codes (99201-99215) for the hospital observation care.

Additionally, with private payors able to “downgrade” inpatient care to observation both during and after discharge (unlike Medicare), inpatient stays greater than 48 hours were being reversed and reported with office codes (99212-99215) on the days between the initial admission service (99218-99220) and the discharge service (99217).¹ The office codes would then be met with denials for “missing referrals,” and subsequent attempts to appeal would often provide no reimbursement.

These combined factors led to the creation of a more viable solution for interim observation days: subsequent observation care (99224-99226).² The attending of record reports these codes on stays that spanned three calendar days but still less than 48 hours; the consultant reports these for their rendered services; and the private payors can make these codes exempt from requiring referrals when downgrading inpatient stays.

References

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011:12-13.

Medicare Benefit Policy Manual: Chapter 6, Section 20.6A. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/manuals/Downloads/bp102c06.pdf. Accessed April 20, 2011.

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Furnished by a physician who is not a resident; or

Furnished by a resident with a teaching physician physically present during the critical or key portion(s) of the service.

Teaching physicians participate in evaluation and management (E/M) services with residents in several ways. Consider the following teaching physician scenarios:

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules.

Scenario 1: “Stand-Alone” Service

Definitions for teaching-physician services

Resident: An individual who participates in an approved GME program or a physician who is not in an approved GME program but who is authorized to practice only in a hospital setting. The term includes interns and fellows in GME programs recognized as approved for purposes of direct GME payments made by the fiscal intermediary (FI). A staff or faculty appointment, or participating in a fellowship, does not by itself alter the status of “resident.” Additionally, this status remains unaffected regardless of whether a hospital includes the physician in its full-time equivalency count of residents.

Student: An individual who participates in an accredited educational program that is not an approved GME program. A student is never considered to be an intern or a resident. Medicare does not pay for any service furnished by a student.

Teaching physician: A physician (other than a resident) who involves residents in the care of his or her patients.

Direct medical and surgical services: Services to individual beneficiaries that are either personally furnished by a physician or furnished by a resident under the supervision of a physician in a teaching hospital. All payments for such services are made by the FI for the hospital.

Teaching setting: Any provider, hospital-based provider, or nonprovider setting in which Medicare payment for the services of residents is made by the FI under the direct GME payment methodology, or freestanding skilled nursing facility or home health agency in which such payments are made on a reasonable cost basis.

Critical or key portion: The part(s) of a service that the teaching physician determines critical or key. In most cases, the terms are interchangeable. —CP

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules. Examples:

“I performed a history and physical examination of the patient and discussed his management with the resident. I reviewed the resident’s note and agree with the documented findings and plan of care.”

“I saw and evaluated the patient. I agree with the findings and the plan of care as documented in the resident’s note.”

“I saw and examined the patient. I agree with the resident’s note, except the heart murmur is louder, so I will obtain an echo to evaluate.”

Scenario 2: “Supervised” Service

Medicare-accepted teaching physician statements associated with this scenario include:

“I was present with the resident during the history and exam. I discussed the case with the resident and agree with the findings and plan as documented in the resident’s note.”

“I saw the patient with the resident and agree with the resident’s findings and plan.”

Scenario 3: The “Shared” Service

Such Medicare-approved statements for use by teaching physicians under this scenario include:

“I saw and evaluated the patient. I reviewed the resident’s note and agree, except that picture is more consistent with pericarditis than myocardial ischemia. Will begin NSAIDs.”

“I saw and evaluated the patient. Discussed with resident and agree with resident’s findings and plan as documented in the resident’s note.”

“See resident’s note for details. I saw and evaluated the patient and agree with the resident’s finding and plans as written.”

“I saw and evaluated the patient. Agree with resident’s note, but lower extremities are weaker, now 3/5; MRI of L/S spine today.”

Time-Based Exception

Student Notes

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center, Philadelphia. She is also on the faculty of SHM’s inpatient coding course.

References

Guidelines for Teaching Physicians, Interns, Residents. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/MLNProducts/downloads/gdelinesteachgresfctsht.pdf. Accessed May 6, 2011.

Medicare Claims Processing Manual: Chapter 12, Section 100. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 6, 2011.

Medicare Benefit Policy Manual: Chapter 15, Section 30.2. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/Downloads/bp102c15.pdf. Accessed May 6, 2011.

Manaker, S. Teaching Physician Regulations. In: Coding for Chest Medicine 2008. Northbrook, IL: American College of Chest Physicians, 2008; 279-285.

Pohlig, C. Evaluation & Management Services: An Overview. In: Coding for Chest Medicine 2011. Northbrook, IL: American College of Chest Physicians, 2010; 323-330.

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011.

READER Q&A

CMS Suggests Extended Observation Should Be Infrequent Occurrence

References

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011:12-13.

Medicare Benefit Policy Manual: Chapter 6, Section 20.6A. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/manuals/Downloads/bp102c06.pdf. Accessed April 20, 2011.

Furnished by a physician who is not a resident; or

Furnished by a resident with a teaching physician physically present during the critical or key portion(s) of the service.

Teaching physicians participate in evaluation and management (E/M) services with residents in several ways. Consider the following teaching physician scenarios:

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules.

Scenario 1: “Stand-Alone” Service

Definitions for teaching-physician services

Resident: An individual who participates in an approved GME program or a physician who is not in an approved GME program but who is authorized to practice only in a hospital setting. The term includes interns and fellows in GME programs recognized as approved for purposes of direct GME payments made by the fiscal intermediary (FI). A staff or faculty appointment, or participating in a fellowship, does not by itself alter the status of “resident.” Additionally, this status remains unaffected regardless of whether a hospital includes the physician in its full-time equivalency count of residents.

Student: An individual who participates in an accredited educational program that is not an approved GME program. A student is never considered to be an intern or a resident. Medicare does not pay for any service furnished by a student.

Teaching physician: A physician (other than a resident) who involves residents in the care of his or her patients.

Direct medical and surgical services: Services to individual beneficiaries that are either personally furnished by a physician or furnished by a resident under the supervision of a physician in a teaching hospital. All payments for such services are made by the FI for the hospital.

Teaching setting: Any provider, hospital-based provider, or nonprovider setting in which Medicare payment for the services of residents is made by the FI under the direct GME payment methodology, or freestanding skilled nursing facility or home health agency in which such payments are made on a reasonable cost basis.

Critical or key portion: The part(s) of a service that the teaching physician determines critical or key. In most cases, the terms are interchangeable. —CP

Using Medicare-approved linkage statements will ensure compliance with teaching physician rules. Examples:

“I performed a history and physical examination of the patient and discussed his management with the resident. I reviewed the resident’s note and agree with the documented findings and plan of care.”

“I saw and evaluated the patient. I agree with the findings and the plan of care as documented in the resident’s note.”

“I saw and examined the patient. I agree with the resident’s note, except the heart murmur is louder, so I will obtain an echo to evaluate.”

Scenario 2: “Supervised” Service

Medicare-accepted teaching physician statements associated with this scenario include:

“I was present with the resident during the history and exam. I discussed the case with the resident and agree with the findings and plan as documented in the resident’s note.”

“I saw the patient with the resident and agree with the resident’s findings and plan.”

Scenario 3: The “Shared” Service

Such Medicare-approved statements for use by teaching physicians under this scenario include:

“I saw and evaluated the patient. I reviewed the resident’s note and agree, except that picture is more consistent with pericarditis than myocardial ischemia. Will begin NSAIDs.”

“I saw and evaluated the patient. Discussed with resident and agree with resident’s findings and plan as documented in the resident’s note.”

“See resident’s note for details. I saw and evaluated the patient and agree with the resident’s finding and plans as written.”

“I saw and evaluated the patient. Agree with resident’s note, but lower extremities are weaker, now 3/5; MRI of L/S spine today.”

Time-Based Exception

Student Notes

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center, Philadelphia. She is also on the faculty of SHM’s inpatient coding course.

References

Guidelines for Teaching Physicians, Interns, Residents. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/MLNProducts/downloads/gdelinesteachgresfctsht.pdf. Accessed May 6, 2011.

Medicare Claims Processing Manual: Chapter 12, Section 100. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 6, 2011.

Medicare Benefit Policy Manual: Chapter 15, Section 30.2. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.hhs.gov/manuals/Downloads/bp102c15.pdf. Accessed May 6, 2011.

Manaker, S. Teaching Physician Regulations. In: Coding for Chest Medicine 2008. Northbrook, IL: American College of Chest Physicians, 2008; 279-285.

Pohlig, C. Evaluation & Management Services: An Overview. In: Coding for Chest Medicine 2011. Northbrook, IL: American College of Chest Physicians, 2010; 323-330.

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011.

READER Q&A

CMS Suggests Extended Observation Should Be Infrequent Occurrence

References

Abraham M, Ahlman J, Boudreau A, Connelly J, Evans D. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2011:12-13.

Medicare Benefit Policy Manual: Chapter 6, Section 20.6A. Centers for Medicare & Medicaid Services website. Available at: http://www.cms.gov/manuals/Downloads/bp102c06.pdf. Accessed April 20, 2011.

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Question: Before hospitalists, who cared for hospitalized patients?

Answer: Generalists—in other words, internists, family physicians, pediatricians.

Q: How much did that system cost hospitals?

A: Nothing, or very little. In some cases, support dollars were available for weekend, night, or uninsured patient coverage, but by and large this system cost hospitals little. Physicians admitted their patients to the hospital because the alternatives (sending a hypoxic pneumonia patient home from clinic, turning out the office lights and hoping the patient survived the night, or bringing the patient home with them) offered uncomfortable ethical, malpractice, or alimony consequences. So doctors admitted these patients to the hospital and visited them daily.

Q: The average amount of support per hospitalist is $131,564, or about $1.7 million per HM group seeing adult patients. The bulk of those dollars come from the hospital. If we assume that the people running hospitals are smart, then why would those smart businesspeople pay $1.7 million for something they used to get for free?

A: Because there is something they get in return for that money. Or, perhaps, something they think they are getting in return for those dollars.

To be great, to best help our patients, to give our hospitals what they want and need, we have to evolve from “internists in the hospital” to hospitalists.

Q: What?

A: I often go through this exercise with the residents in our hospitalist training program when we discuss the drivers of the HM movement. I usually discuss the reasons why a hospital should fund these groups; it always seems like such a no-brainer to me.

Enter a recent news item from Montana. The story from the Helena Independent Record (see “Unsustainable Growth?” p. 1) noted that a multispecialty group practice in Helena announced they were no longer admitting their patients to a local hospital in protest over a new hospital policy to charge the clinic practice. The fee was to defray some of the costs of the HM program. A hospital representative was quoted as saying “physicians are responsible for obtaining hospital coverage for their own patients, not the hospital.”

I can’t really argue with the logic of that statement. Surely a clinic has responsibility to ensure that their patients get cared for while they are inpatients. If an internist is going to see a patient in the clinic and admit them to the hospital, shouldn’t an internist then see the patient in the hospital?

If I’m a hospital CEO, the answer is no.

To retrench a bit, yes, I’d want a board-certified internal-medicine (or pediatric or family medicine) physician to see the hospitalized patient. But in the process, I wouldn’t want them to only practice internal medicine. That was the model hospitals had 25 years ago—a model that cost them very little, a model that they played a large part in exterminating. The fact that most hospitals are willing to pay millions or more per year to not have that system tells me that they don’t want that system.

Q: So, what do hospitals want?

A: Hospitalists, not internists in the hospital.

What’s the difference? Well, it’s a perception issue. Many, if not most, believe that all it takes to be a great hospitalist is to show up for your shift, provide great care to your 15 patients, and go home. That is, the job is defined by the clinical effort—the internist part. Although there is tremendous benefit to this and I recognize its importance (and let’s not forget the weekend, night, and holiday coverage), this sells us short and puts our financial stability in peril.

To be great, to best help our patients, to give our hospitals what they want and need, we have to evolve from “internists in the hospital” to hospitalists. Hospitalists are defined not by our clinical effort but rather by our nonclinical effort. This is what hospitals are paying $1.7 million per year for. They had the internist in the hospital model and chose to pay more—they chose the hospitalist model.

To be a great hospitalist group means embracing the nonclinical work that envelops the clinical practice—the process and quality improvement (QI). That is, fundamentally changing the unsafe systems that surround our patients. Making them safer, more efficient and of higher quality.

This takes time.

Time = Money

It takes time to implement a QI project to reduce central line infections in the ICU. Or to develop and implement a VTE prophylaxis order set or an insulin or heparin drip protocol. Or to work closely with nursing to reduce falls on a medical unit. It takes time to be at the pneumonia core measures meeting every Monday at 7 a.m. and the hospital credentialing committee meeting every other Friday at 3 p.m. It also takes time to implement a new electronic health record or roll out the new LEAN project to reduce ED wait times.

This takes time, effort, and bandwidth—the kind that can’t be shoehorned into the average clinical day. This is work that needs to be done primarily during nonclinical hours. It’s the kind of work that defines HM as a field; the kind of work that increasingly determines your hospital’s bottom line; the kind of work that has tremendous value; the kind of work that requires remuneration.

In paying for the hospitalist model, your hospital is paying for the clinical (internist) and nonclinical (hospitalist) work you do. The $1.7 million per year is not a subsidy they pay to keep you in business. It’s the price they must pay to compensate your group for all the nonclinical work you do around quality, safety, efficiency, and leadership.

Q: But what if my group isn’t doing these kinds of things?

A: Then your hospital funding is at risk. The Montana story addresses just such a scenario. Clearly the hospital C-suite in this instance only valued (or was presented with) clinical work. Therefore, they felt that others should subsidize the hospitalist salaries—in this case, the clinic. I don’t know the particulars of this case but deduce this because it would be ludicrous to expect the clinic to pay for the part of the hospitalists’ time spent improving the hospital’s systems of care.

Writing the Final Chapter

At the core of the HM funding model is the concept of subsidy versus compensation. If we are only providing clinical care, then the offset dollars from the hospital to support our salaries is functionally a subsidy—a dollar amount to make up for our collections shortfall. However, if it is support for the nonclinical work we are doing, then it is compensation.

As the story of hospitalist funding is written, the report from Montana should serve as a cautionary tale. Hospital financial pressures likely will focus more scrutiny on the hospitalist financial support model. And as this story plays out, HM groups will be expected to bring more to the table than patient care.

Those that do will live happily ever after.

Those that don’t will be forced to answer the tough question: What’s the difference between an internist in the hospital and a hospitalist? If the answer is nothing, that story will have a decidedly and predictably less happy ending. TH

Dr. Glasheen is associate professor of medicine at the University of Colorado Denver, where he serves as director of the Hospital Medicine Program and the Hospitalist Training Program, and as associate program director of the Internal Medicine Residency Program.

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Question: Before hospitalists, who cared for hospitalized patients?

Answer: Generalists—in other words, internists, family physicians, pediatricians.

Q: How much did that system cost hospitals?

A: Because there is something they get in return for that money. Or, perhaps, something they think they are getting in return for those dollars.

To be great, to best help our patients, to give our hospitals what they want and need, we have to evolve from “internists in the hospital” to hospitalists.

Q: What?

If I’m a hospital CEO, the answer is no.

Q: So, what do hospitals want?

A: Hospitalists, not internists in the hospital.

This takes time.

Time = Money

Q: But what if my group isn’t doing these kinds of things?

Writing the Final Chapter

Those that do will live happily ever after.

Question: Before hospitalists, who cared for hospitalized patients?

Answer: Generalists—in other words, internists, family physicians, pediatricians.

Q: How much did that system cost hospitals?

A: Because there is something they get in return for that money. Or, perhaps, something they think they are getting in return for those dollars.

To be great, to best help our patients, to give our hospitals what they want and need, we have to evolve from “internists in the hospital” to hospitalists.

Q: What?

If I’m a hospital CEO, the answer is no.

Q: So, what do hospitals want?

A: Hospitalists, not internists in the hospital.

This takes time.

Time = Money

Q: But what if my group isn’t doing these kinds of things?

Writing the Final Chapter

Those that do will live happily ever after.

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HM11 and the publication of the SHM-MGMA survey on hospitalist productivity and compensation occur every summer, and they always provide lots of new information to get me thinking. Two things stand out this year: Hospitalist demand remains high, and hospitals are paying a lot to have hospitalist services.

Supply and Demand

Along with SHM President Joe Li and Rob Bessler, who is CEO of Sound Physicians, I had the pleasure of presenting a preview of some data from the latest SHM-MGMA survey at the annual meeting May 11 in Dallas. During the session, I asked the large crowd of hospitalists how many were from practices that are actively recruiting additional hospitalists. About 40% of the hands went up.

If 40% of HM groups are actively recruiting, some for more than one open position, that’s a lot of recruiting. But it is dramatically less than the response I got when I asked the same question just three years ago at HM08 in San Diego. At that meeting, nearly every hand in the room went up, indicating everybody was recruiting (see “We’re Hiring,” July 2008, p. 62).

Of course, my show-of-hands survey of attendees at SHM meetings is not a perfect method to assess hospitalist supply and demand. But I think the dramatic change in responses from 2008 to 2011 is meaningful; it also matches what I’m seeing in the marketplace. I hear repeatedly that the years of rapid growth in hospitalist staffing have ended in many or most major metropolitan areas. For example, in places like Seattle (where I practice), Minneapolis, and Boston, there are far fewer open positions now than just two years ago, and most are to replace a departing doctor rather than to increase the overall staffing level.

I think the average hospitalist today is pretty talented, but I also think it could get even better if the supply of hospitalists exceeds demand. I just hope I continue to make the cut!

But the far more numerous smaller markets are still recruiting aggressively in an effort to increase the overall staffing of the practice (and not just replace departing doctors). And changes in resident work-hour limitations are requiring teaching hospitals to increase hospitalist staffing to offset the reduction in resident availability. But it’s possible that if the larger markets are indeed becoming somewhat saturated with hospitalists, then there will be a trickledown effect, which should make more candidates available everywhere.

What will be the side effects if indeed the supply of hospitalists catches up to the demand, or even exceeds demand, in some places? It is easy to imagine that greater competition among candidates might mean that practices are increasingly able to hire the more talented and committed doctors, which should improve the overall performance of hospitalist practices.

Although I don’t have proof, I think this phenomenon has been in play in the field of emergency medicine for many years. When I was a resident in the 1980s, ED doctors typically were not the best and brightest at their hospitals. But the way I see it, the field began to attract better candidates, and as ED residencies and practices began to “fill up,” they could be more selective in new hires. Therefore, the average talent of the average ED doctor went up.

I think the average hospitalist today is pretty talented, but I also think it could get even better if the supply of hospitalists exceeds demand. I just hope I continue to make the cut!

If typical market forces are operative for hospitalists (far from a guarantee in any healthcare enterprise), then an oversupply of hospitalists could mean a flattening of the historical trend in hospitalist incomes. To this point, in our relatively young field, incomes have risen faster than can be explained solely by inflation or increases in hospitalist productivity. A relative shortage of hospitalists might be one of the main forces pushing incomes up, and it might go away.

We’ll see.

Hospital Support Trends Up

The most remarkable number in the 2011 SHM-MGMA survey is the financial support provided to practices per FTE hospitalist annually. This support nearly always comes from a hospital, and is often colloquially, and misleadingly, referred to as the “subsidy.”

In 2001, hospital support was about $65,000 per FTE. In the 2008 and 2010 surveys, the median financial support per FTE was $97,000 and $98,000, respectively. But it jumped to $136,403 this year. That is a really huge jump in one year. (Note: The surveys changed from biannual to annual in 2010, and the new SHM-MGMA survey uses a different financial support question/methodology and has a different respondent pool than the previous SHM surveys.)

Some of the increased dollars probably went to pay rising hospitalist compensation, which rose about 3% over the prior year without any significant increase in productivity. But that 3% salary increase translates to only about $5,000 (median compensation rose from roughly $215,000 to $220,000), and could be explained in part by such factors as removing academicians from this data set. (Starting in 2010, academic hospitalists are surveyed and reported separately, so aren’t included here.) So I don’t think the change in hospitalist incomes seen in this survey has much to do with the dramatic, near-40% increase in financial support.

The survey showed that hospitalist productivity hasn’t declined, so the other most likely culprit is declining professional fee collections, which might be due to an increasing portion of hospitalized patients who are uninsured or underinsured. Many hospitals report that their “payor mix” has worsened since the economic crisis of the last few years. And because hospitals typically hold the risk for the financial performance of their hospitalists, then if the latter see more uninsured patients and collect less in professional fees, the hospital will make up the difference. This phenomenon might explain much of the increased financial support.

But I’m not satisfied that a worsening payor mix explains everything. For example, if this were the most significant reason for increasing financial support, I think we would have seen this effect in the prior survey. Why did it “hit” so suddenly in this year alone?

We will get more information about collection rates when the second part of the survey is published in September. For example, we’ll be able to compare the dollars collected per encounter or per wRVU in the current survey to the prior one. If there was a significant drop, then it will require only a little math to see how much overall collections dropped per FTE and see if it is similar to the rise in financial support provided.

Of course, it will be very informative to see what the financial support turns out to be in the next survey (check back in late spring 2012). Will it stay around $136,000 per FTE or be something very different? TH

Dr. Nelson has been a practicing hospitalist since 1988 and is co-founder and past president of SHM. He is a principal in Nelson Flores Hospital Medicine Consultants, a national hospitalist practice management consulting firm (www.nelsonflores.com). He is course co-director and faculty for SHM’s “Best Practices in Managing a Hospital Medicine Program” course. This column represents his views and is not intended to reflect an official position of SHM.

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I think the average hospitalist today is pretty talented, but I also think it could get even better if the supply of hospitalists exceeds demand. I just hope I continue to make the cut!

We’ll see.

Hospital Support Trends Up

Supply and Demand

I think the average hospitalist today is pretty talented, but I also think it could get even better if the supply of hospitalists exceeds demand. I just hope I continue to make the cut!

We’ll see.

Hospital Support Trends Up

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Did delayed cesarean delivery cause child’s brain damage?

SEVERAL HOURS AFTER A WOMAN ARRIVED at a hospital in labor, the fetal heart rate dropped to 60 beats/min. The on-call ObGyn performed a cesarean delivery 90 minutes later. The child has permanent neurologic disabilities, receives nourishment through a gastric tube, and will require full-time assistance for life.

PATIENT’S CLAIM The 90-minute delay in performing cesarean delivery caused brain damage. A compressed umbilical cord reduced the oxygen supply, compromised the fetal heart rate, and led to brain damage. There were delays in notifying the physician, assembling the surgical team, and taking the mother to the operating room. The ObGyn failed to inform the mother she could have an expedited cesarean section under local anesthesia.

DEFENDANTS’ DEFENSE The ObGyn claimed that a placental infection caused the child’s brain damage. The hospital claimed that the physician was called immediately, the surgical team was gathered as quickly as possible, and cesarean delivery was performed in a timely manner.

VERDICT An $8.5 million New Jersey settlement was reached, including $6 million for the child and $2.5 million for the parents.

PPH untreated—blood could not be found

AT AGE 36, A WOMAN GAVE BIRTH to her first child by cesarean delivery. She developed postpartum hemorrhage, but surgery was not performed because physicians believed the hospital did not have enough matched blood for a transfusion. The woman died.

It was later determined that the hospital did have the appropriate blood in its refrigerator. The estate reached a confidential settlement with the delivering physician, leaving only the hospital as defendant at trial.

ESTATE’S CLAIM The hospital failed to maintain an adequate stock of blood, failed to follow policy in procuring emergency blood, and failed to provide blood in a timely manner.

In discovery, the estate learned that a janitor had been sent to procure blood, despite hospital policy requiring that emergency blood be delivered by law enforcement. An order to type and screen the patient’s blood was given before cesarean delivery, but was not carried out for hours. The woman was type A-negative, which the hospital did not stock. The hospital did have A-positive and O-positive blood, which could have been used, but the physicians were not told it was available.

HOSPITAL’S DEFENSE The physician should have performed surgery. Blood was not needed for the procedure that would have saved the woman’s life. Her death was due to peripartum cardiomyopathy.

VERDICT A $4,623,924 Minnesota verdict was returned.

RELATED ARTICLE IN THIS ISSUE

Have you made best use of the Bakri balloon in PPH?
Robert L. Barbieri, MD (July 2011)

Were non-stress tests interpreted accurately?

A MOTHER BEGAN TO EXPERIENCE irregular contractions and decreased fetal movement at 38 weeks’ gestation. Her ObGyn sent her to the emergency department for a non-stress test and fetal ultrasonography. The tests were interpreted as normal, and she was discharged.

When she saw her ObGyn the next day, he repeated the non-stress test, and found the results to be reassuring and reactive.

Two days later, the ObGyn was unable to find a fetal heartbeat. He sent the woman to the hospital, where a diagnosis of intrauterine fetal demise at term was made. After attempts to induce labor were unsuccessful, a cesarean delivery was performed, and a 10-lb, 8-oz stillborn baby was delivered. The pathologist was unable to define a cause of death at autopsy.

PATIENT’S CLAIM The physician was negligent in failing to properly interpret the non-stress tests. Because of the mother’s symptoms, additional testing should have been performed that would have revealed fetal compromise, and led to delivery of a healthy baby.

PHYSICIAN’S DEFENSE The treatment provided was appropriate. The non-stress tests were properly interpreted.

VERDICT An Illinois defense verdict was returned.

Child’s arm paralyzed despite mother’s expressed concern

WHEN PREGNANT A SECOND TIME, a woman reported to Dr. A, a member of an ObGyn group, that she had a history of gestational diabetes, and that her first child had been large but had been delivered vaginally. At 28 weeks’ gestation, screening was negative for gestational diabetes. Two prenatal sonograms, performed at 35 and 37 weeks’ gestation, showed a large fetus.

The woman went into labor at 39 weeks. Dr. B, an associate of Dr. A, encountered shoulder dystocia, but freed the shoulder and completed the vaginal delivery. The baby had Apgar scores of 2, 3, and 7. He was given a diagnosis of separation of four of five nerve roots in his shoulder and has complete paralysis of the right arm, from biceps to fingers.

PATIENT'S CLAIM Knowing the mother’s history, the ObGyns were negligent in not diagnosing gestational diabetes. A cesarean delivery should have been performed because the fetus was known to be large; in fact, the mother requested cesarean delivery during labor—because she could tell the baby was larger than her first child—but the request was refused. Proper maneuvers were not used when shoulder dystocia occurred.

PHYSICIANS’ DEFENSE The prenatal charts were not sent to the hospital, so the results of the sonograms were unavailable. The fetus experienced intermittent hypoxia during delivery, resulting in a “floppy baby” more susceptible to injury during normal maneuvers. Shoulder dystocia was treated properly.

VERDICT A $1.6 million Ohio verdict was returned against the ObGyn group.

Midwife “pulled too hard”; child injured

A NURSE MIDWIFE ENCOUNTERED shoulder dystocia. Without calling for her back-up physician, she delivered the child. The baby suffers from a moderate brachial plexus injury.

PLAINTIFF’S CLAIM The midwife should have called in the physician when shoulder dystocia was encountered. The midwife pulled too hard on the child’s head, causing the injury.

DEFENDANT’S DEFENSE The midwife properly treated shoulder dystocia.

VERDICT A $950,000 North Carolina verdict was returned.

Would earlier cancer diagnosis have changed prognosis?

AFTER LAPAROSCOPIC ADHESIOLYSIS failed to resolve severe abdominal pain, a 52-year-old woman underwent removal of her ovaries and fallopian tubes in 2005. A pathologist reported that the tissue was a benign serous papillary tumor with psammoma bodies. Two years later, the woman’s abdominal pain returned, and, over the next 8 months, her primary physician sent her for several magnetic resonance imaging scans that revealed little change in the lower pelvis.

A diagnostic laparoscopy in 2008 found low-grade IIIC primary peritoneal carcinoma thought to have originated from her ovaries and fallopian tubes. The surgeon testified that there was cancer everywhere in the woman’s peritoneal cavity. After comparing pathology slides from the two procedures, the surgeon believed the tissue was virtually identical, and that the patient had been misdiagnosed in 2005.

PATIENT’S CLAIM The pathologist was at fault for not diagnosing cancer or borderline cancer in 2005. Had it been diagnosed then, the patient’s chances of survival would have been increased by almost 70%.

PHYSICIAN’S DEFENSE According to a gynecologic pathology expert who reviewed both tissue samples, the 2005 diagnosis was reasonable. An earlier diagnosis would not have changed the woman’s prognosis.

VERDICT A Washington defense verdict was returned.

Skull fracture and brain hemorrhage in infant

AFTER 11 HOURS OF LABOR, a mother developed fever. The fetal heart rate fluctuated until the baby was delivered 3 hours later. When the cervix was fully dilated, the mother’s pushing failed to result in fetal descent, and a cesarean delivery was performed. The child suffered seizures shortly after birth; magnetic resonance imaging and computed tomography scans revealed a linear skull fracture with subarachnoid hemorrhage. The discharge summary for the baby indicated hypotonia, birth depression, and acidosis.

PATIENT’S CLAIM During prenatal treatment, the ObGyn suggested the mother might require cesarean delivery because of her small stature (height, <5 ft). The injuries to the baby could have been avoided; when an arrest of labor occurred soon after the mother’s arrival at the hospital, a cesarean delivery should have been performed.

PHYSICIAN’S DEFENSE An arrest of labor did not occur; treatment provided was proper and timely

VERDICT A New York defense verdict was returned.

References

These cases were selected by the editors of OBG Management from Medical Malpractice Verdicts, Settlements & Experts, with permission of the editor, Lewis Laska (www.verdictslaska.com). The information available to the editors about the cases presented here is sometimes incomplete. Moreover, the cases may or may not have merit. Nevertheless, these cases represent the types of clinical situations that typically result in litigation and are meant to illustrate nationwide variation in jury verdicts and awards.

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Did delayed cesarean delivery cause child’s brain damage;Medical Verdicts;NOTABLE JUDGMENTS AND SETTLEMENTS;cesarean delivery;brain damage;compressed umbilical cord;placental infection;settlement;verdict;defense;PPH;postpartum hemorrhage;transfusion;emergency blood;decreased fetal movement;non-stress test;gestational diabetes;shoulder dystocia;floppy baby;midwife;peritoneal carcinoma;skull fracture;arrest of labor;Medical Malpractice Verdicts;Settlements & Experts;Lewis Laska

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Did delayed cesarean delivery cause child’s brain damage?

VERDICT An $8.5 million New Jersey settlement was reached, including $6 million for the child and $2.5 million for the parents.

PPH untreated—blood could not be found

ESTATE’S CLAIM The hospital failed to maintain an adequate stock of blood, failed to follow policy in procuring emergency blood, and failed to provide blood in a timely manner.

HOSPITAL’S DEFENSE The physician should have performed surgery. Blood was not needed for the procedure that would have saved the woman’s life. Her death was due to peripartum cardiomyopathy.

VERDICT A $4,623,924 Minnesota verdict was returned.

RELATED ARTICLE IN THIS ISSUE

Have you made best use of the Bakri balloon in PPH?
Robert L. Barbieri, MD (July 2011)

Were non-stress tests interpreted accurately?

When she saw her ObGyn the next day, he repeated the non-stress test, and found the results to be reassuring and reactive.

PHYSICIAN’S DEFENSE The treatment provided was appropriate. The non-stress tests were properly interpreted.

VERDICT An Illinois defense verdict was returned.

Child’s arm paralyzed despite mother’s expressed concern

VERDICT A $1.6 million Ohio verdict was returned against the ObGyn group.

Midwife “pulled too hard”; child injured

A NURSE MIDWIFE ENCOUNTERED shoulder dystocia. Without calling for her back-up physician, she delivered the child. The baby suffers from a moderate brachial plexus injury.

PLAINTIFF’S CLAIM The midwife should have called in the physician when shoulder dystocia was encountered. The midwife pulled too hard on the child’s head, causing the injury.

DEFENDANT’S DEFENSE The midwife properly treated shoulder dystocia.

VERDICT A $950,000 North Carolina verdict was returned.

Would earlier cancer diagnosis have changed prognosis?

VERDICT A Washington defense verdict was returned.

Skull fracture and brain hemorrhage in infant

PHYSICIAN’S DEFENSE An arrest of labor did not occur; treatment provided was proper and timely

VERDICT A New York defense verdict was returned.

Did delayed cesarean delivery cause child’s brain damage?

VERDICT An $8.5 million New Jersey settlement was reached, including $6 million for the child and $2.5 million for the parents.

PPH untreated—blood could not be found

ESTATE’S CLAIM The hospital failed to maintain an adequate stock of blood, failed to follow policy in procuring emergency blood, and failed to provide blood in a timely manner.

HOSPITAL’S DEFENSE The physician should have performed surgery. Blood was not needed for the procedure that would have saved the woman’s life. Her death was due to peripartum cardiomyopathy.

VERDICT A $4,623,924 Minnesota verdict was returned.

RELATED ARTICLE IN THIS ISSUE

Have you made best use of the Bakri balloon in PPH?
Robert L. Barbieri, MD (July 2011)

Were non-stress tests interpreted accurately?

When she saw her ObGyn the next day, he repeated the non-stress test, and found the results to be reassuring and reactive.

PHYSICIAN’S DEFENSE The treatment provided was appropriate. The non-stress tests were properly interpreted.

VERDICT An Illinois defense verdict was returned.

Child’s arm paralyzed despite mother’s expressed concern

VERDICT A $1.6 million Ohio verdict was returned against the ObGyn group.

Midwife “pulled too hard”; child injured

A NURSE MIDWIFE ENCOUNTERED shoulder dystocia. Without calling for her back-up physician, she delivered the child. The baby suffers from a moderate brachial plexus injury.

PLAINTIFF’S CLAIM The midwife should have called in the physician when shoulder dystocia was encountered. The midwife pulled too hard on the child’s head, causing the injury.

DEFENDANT’S DEFENSE The midwife properly treated shoulder dystocia.

VERDICT A $950,000 North Carolina verdict was returned.

Would earlier cancer diagnosis have changed prognosis?

VERDICT A Washington defense verdict was returned.

Skull fracture and brain hemorrhage in infant

PHYSICIAN’S DEFENSE An arrest of labor did not occur; treatment provided was proper and timely

VERDICT A New York defense verdict was returned.

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I recently was appointed the director of my hospitalist group at a 53-bed hospital in rural Wisconsin. Including myself, we have three hospitalist FTEs, one part-time hospitalist, and one nurse practitioner; we are all seasoned internists, but we are relatively new to HM and the 24/7 nature of the business. The hospital administration has charged me with making the program more efficient. What do you suggest I do to improve our efficiency and standard of patient care?

Andrew Neubauer, DO, MPH

Dr. Hospitalist responds: Congratulations aside, one of the first items at hand is to understand the question being asked. Your hospital administration potentially has many moving parts: a CEO for vision, a chief operating officer (COO) for execution, a chief medical officer (CMO) for medical staff initiatives, and a chief financial officer (CFO) for the hard truth of hospital finances.

Before you take any steps to improve efficiency, you need to ask what “efficiency” means.

Is it the CFO asking for better financial returns?

Is the CEO trying to woo a large surgical group and needs to tout his high-functioning hospitalist group to make it more attractive?

Does the CMO want to improve staff relations and primary-care referrals?

Does the COO want higher patient satisfaction?

Whatever the answer is, the first thing to do is define the question. So, in a non-confrontational, inquisitive way, ask your administrators what they mean by “efficiency.”

The immediate corollary to this is that you must then get baseline data. You have to know where you are starting from in order to show demonstrable progress toward a goal. Whether it’s the case-mix index, the readmission rate, or adherence to protocols, defining the baseline and the goal is paramount.

Why is this so important? You need to be able to prove you met the goals, because as soon as you meet this one, a new one will be placed in front of you.

Ask Dr. hospitalist

Do you have a problem or concern that you’d like Dr. Hospitalist to address? Email your questions to [email protected].

Let’s assume, by way of example, that “efficiency” in this case means an earlier time of discharge. For starters, ask what the average time of discharge is now, how it is measured, what the desired result is, and why. Once you have that information, look for ways that your group can improve, and make sure that the hospital is measuring you only on things you can control. Your physicians can determine the time the discharge order is written, but they have no say in when the patient physically leaves the building. It might seem like a subtle distinction, but it can make all the difference depending on how “time of discharge” is defined. Don’t promise what you can’t deliver—you’ll disappoint both the hospital and your practice partners.

Going forward, you should keep a playbook of past goals asked of you, and your group’s actions. This is incredibly important if (when) your contract comes up for renewal, since you will need to gently (and sometimes forcefully) remind the hospital of your group’s value. In addition, the other main constant in any hospital administration is change; last I checked, the average tenure for a hospital CEO is four years. You want to always be able to communicate your group’s achievements to serve as a visible reminder of your central role in the hospital.

As the newly appointed medical director, everyone is looking to you for answers. Just make sure to focus on the question first. TH

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Before you take any steps to improve efficiency, you need to ask what “efficiency” means.

Is it the CFO asking for better financial returns?

Is the CEO trying to woo a large surgical group and needs to tout his high-functioning hospitalist group to make it more attractive?

Does the CMO want to improve staff relations and primary-care referrals?

Does the COO want higher patient satisfaction?

Whatever the answer is, the first thing to do is define the question. So, in a non-confrontational, inquisitive way, ask your administrators what they mean by “efficiency.”

Why is this so important? You need to be able to prove you met the goals, because as soon as you meet this one, a new one will be placed in front of you.

Ask Dr. hospitalist

Do you have a problem or concern that you’d like Dr. Hospitalist to address? Email your questions to [email protected].

As the newly appointed medical director, everyone is looking to you for answers. Just make sure to focus on the question first. TH

Andrew Neubauer, DO, MPH

Before you take any steps to improve efficiency, you need to ask what “efficiency” means.

Is it the CFO asking for better financial returns?

Is the CEO trying to woo a large surgical group and needs to tout his high-functioning hospitalist group to make it more attractive?

Does the CMO want to improve staff relations and primary-care referrals?

Does the COO want higher patient satisfaction?

Whatever the answer is, the first thing to do is define the question. So, in a non-confrontational, inquisitive way, ask your administrators what they mean by “efficiency.”

Why is this so important? You need to be able to prove you met the goals, because as soon as you meet this one, a new one will be placed in front of you.

Ask Dr. hospitalist

Do you have a problem or concern that you’d like Dr. Hospitalist to address? Email your questions to [email protected].

As the newly appointed medical director, everyone is looking to you for answers. Just make sure to focus on the question first. TH

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I stare; a brimming audience stares back. Two eyeballs battling thousands. Slightly uncomfortable, I shift my weight, trying to hide behind the glass podium. Two microphones snake out of the podium slithering together inches from my mouth. The attendees squirm, sidle to the edge of their seats, restless to depart. HM11 is trying to close; only I stand in its way.

A Herculean task lies before me—summarize the annual meeting in a 10-minute wrap-up session titled “What We’ve Learned.” How do you summarize four days, eight pre-courses, nine breakout tracks, and more than 100 presentations in a few minutes? A bead of forehead sweat forms; I clear my throat. Memories of the past few days slide-show across my mind. It occurs to me that the essence of the meeting is not contained in the data, the information, or the PowerPoint slides that were presented. Rather, the story of HM11 is best told through its quotes.

Patient Caps: Your Grandmother and Professionalism

“I worry about patient caps because the next patient could be your grandmother.”

—Joe Li, MD, SFHM, new president of SHM

“Patient caps are the greatest threat to the professionalism of the field.”

—Rob Bessler, MD, CEO, Sound Inpatient Physicians

These two quotes from the opening plenary focused on the 2011 HM compensation and productivity survey particularly stuck out. The most noteworthy exchange came when Drs. Li and Bressler commented on the appropriate number of daily encounters for a hospitalist. The quotes highlight two important points about patient volume, especially in the wake of the training regulations that limit the number of resident physician encounters, which can engender a “cap mentality.” One is that it matters; there is a safe amount of encounters that shouldn’t routinely be breached. Two is that in the heat of the moment, Patient 19 is as important as Patient 11 and should be treated as such. Contingency plans are essential, but our field is built on the moorings of professionalism—the focus needs to be on humans, not numbers.

In the very near future, we will be measured and paid based on our ability to affect quality outcomes, not patient encounters. The message was simple— it’s about quality, not quantity.

Hospitalist Compensation: Increasing but Not as Juicy

“It’s not going to get less anytime soon.”

—Dr. Bressler

In commenting on the data showing that the average community hospitalist makes about $220,000 annually—a 3% increase over last year—while producing around 4,000 work RVUs—flat over last year—and that their academic counterparts made $173,000 on about 3,400 wRVUs, Dr. Bressler opined that the laws of supply and demand would dictate that salaries would continue to rise for the near term. Although I agree with Dr. Bressler, my guess is that future salary increases will be driven more by quality than quantity (more to follow below).

“Juice-to-squeeze ratio”

—John Nelson, MD, MHM, SHM cofounder

Dr. Nelson highlighted interesting data showing that the average pay per wRVU was approximately $54. However, he noted that the compensation per wRVU tends to peak at a certain level, after which compensation per wRVU falls. In other words, after, say, 4,000 wRVUs, the amount of compensation per wRVU diminishes such that seeing more patients benefits an individual hospitalist less. That is, lots of squeeze, little juice at the high end.

Reform: Variety, Change, and Waste

“Variety is about choice; change is not.”

—Cecil Wilson, MD, AMA president

“You won’t have many more conferences where you start by talking about work RVUs.”

—Bob Kocher, MD, former special assistant to President Obama

The highlight of the conference for me was Dr. Kocher’s behind-the-scenes look at what was a very publicly muddy event—the passage of ACA. Coming from a D.C. insider, this under-the-covers peek at the machinations that went into passing the healthcare reform bill was fascinating.

The key message, summarized in this comment referring to the opening plenary about hospitalist compensation and productivity, was that the future is quality and the future is now. In the very near future, we will be measured and paid based on our ability to effect quality outcomes, not patient encounters. The message was simple: It’s about quality, not quantity.

“It costs $7.50 for a healthcare transaction, versus 2 cents for a VISA transaction.”

—Dr. Kocher

A statistic I had not heard before, this quote sums up one of the major problems with American healthcare: waste. The $7.50 transaction he was referring to was the amount of money it takes to file a healthcare claim. We certainly feel it in the challenges of documentation, billing, and denials, but the system feels it in terms of high cost of capturing what in many ways should be as simple as swiping your credit card at Starbucks.

Duty-Hour Restrictions: Harbinger of The Future?

“Don’t begrudge the ACGME—begrudge us.”

—Jeff Wiese, MD, SFHM, SHM past president

In a much-anticipated session on the impact of the new ACGME residency work-hour rules commencing in July—notably limiting intern (16-hour) and resident (28-hour) shift duration—Dr. Wiese aptly pointed out that a lot of the angst toward residency work environment regulation could have been avoided if physician leadership had better reacted to the issues of sleep deprivation and resident fatigue following Libby Zion’s death in 1984. Had we put our energy into improving work conditions rather than debate the impact of sleep deprivation on the outcome in this one case, we might be in a different place today.

I couldn’t help but wonder if the message here could also be applied to society’s push for higher quality, lower cost, and safer care. Either we regulate ourselves or someone else will. In other words, we need to embrace quality and safety, or it will be thrust upon us from external sources in ways we might not like.

A Mariner Calls

“I love you, Papi. Come home and take some baseball cuts.”

—Greyson Glasheen, future Major League Baseball shortstop

I wrote in a column leading up to the annual meeting (see “Annual Meeting Mariner,” April 2011, p. 45) that I was looking forward to the meeting because it was a professional mariner of sorts, a way for me to refresh, reset, and reinvigorate. Indeed, reflecting from the podium, it had been a fantastic meeting that served its purpose well. I had learned a ton, caught up with colleagues I hadn’t seen since the last meeting, saw old medical school friends, and met future old friends. I’d led a committee, given a talk, presented a poster, met up with a mentor, and had a reunion with past attendees of the Academic Hospitalist Academy.

Yet I was ready to get back to normalcy. On the last night of the meeting, I was therefore drawn by a different, more personal mariner—this time, a 14-second voicemail message from a 3-year-old boy waiting impatiently for Dad to come home, to make him his center, to simply play a little tee ball in the backyard. TH

Dr. Glasheen is associate professor of medicine at the University of Colorado at Denver, where he serves as director of the Hospital Medicine Program and the Hospitalist Training Program, and as associate program director of the Internal Medicine Residency Program.

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Patient Caps: Your Grandmother and Professionalism

“I worry about patient caps because the next patient could be your grandmother.”

—Joe Li, MD, SFHM, new president of SHM

“Patient caps are the greatest threat to the professionalism of the field.”

—Rob Bessler, MD, CEO, Sound Inpatient Physicians

In the very near future, we will be measured and paid based on our ability to affect quality outcomes, not patient encounters. The message was simple— it’s about quality, not quantity.

Hospitalist Compensation: Increasing but Not as Juicy

“It’s not going to get less anytime soon.”

—Dr. Bressler

“Juice-to-squeeze ratio”

—John Nelson, MD, MHM, SHM cofounder

Reform: Variety, Change, and Waste

“Variety is about choice; change is not.”

—Cecil Wilson, MD, AMA president

“You won’t have many more conferences where you start by talking about work RVUs.”

—Bob Kocher, MD, former special assistant to President Obama

“It costs $7.50 for a healthcare transaction, versus 2 cents for a VISA transaction.”

—Dr. Kocher

Duty-Hour Restrictions: Harbinger of The Future?

“Don’t begrudge the ACGME—begrudge us.”

—Jeff Wiese, MD, SFHM, SHM past president

A Mariner Calls

“I love you, Papi. Come home and take some baseball cuts.”

—Greyson Glasheen, future Major League Baseball shortstop

Patient Caps: Your Grandmother and Professionalism

“I worry about patient caps because the next patient could be your grandmother.”

—Joe Li, MD, SFHM, new president of SHM

“Patient caps are the greatest threat to the professionalism of the field.”

—Rob Bessler, MD, CEO, Sound Inpatient Physicians

In the very near future, we will be measured and paid based on our ability to affect quality outcomes, not patient encounters. The message was simple— it’s about quality, not quantity.

Hospitalist Compensation: Increasing but Not as Juicy

“It’s not going to get less anytime soon.”

—Dr. Bressler

“Juice-to-squeeze ratio”

—John Nelson, MD, MHM, SHM cofounder

Reform: Variety, Change, and Waste

“Variety is about choice; change is not.”

—Cecil Wilson, MD, AMA president

“You won’t have many more conferences where you start by talking about work RVUs.”

—Bob Kocher, MD, former special assistant to President Obama

“It costs $7.50 for a healthcare transaction, versus 2 cents for a VISA transaction.”

—Dr. Kocher

Duty-Hour Restrictions: Harbinger of The Future?

“Don’t begrudge the ACGME—begrudge us.”

—Jeff Wiese, MD, SFHM, SHM past president

A Mariner Calls

“I love you, Papi. Come home and take some baseball cuts.”

—Greyson Glasheen, future Major League Baseball shortstop

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Breast infection misdiagnosed...and more

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Breast infection misdiagnosed

A SWOLLEN, TENDER AREA DEVELOPED on a mother’s right breast 3 weeks after giving birth. She called her ObGyn to report that pus was oozing from the nipple. He prescribed an antibiotic for what he presumed to be a clogged milk duct, and told her to continue to breastfeed. The infection worsened, until milk ceased to flow and the breast was red, painful, and warm.

At an office visit 2 weeks after the phone call, the ObGyn prescribed a new antibiotic, and told the mother to let the right breast milk dry up. Within 24 hours, pus breached the skin several centimeters above the nipple. The patient went to the emergency department, where 100 cc of pus was surgically removed. The infection was diagnosed as methicillin-resistant Staphylococcus aureus (MRSA). The patient was found to also have a MRSA infection in her left breast, but that infection was able to be treated by needle drainage. The ObGyn reported that he believed that the MRSA infection had developed shortly after the office visit.

PATIENT’S CLAIM The ObGyn was negligent in not diagnosing the infection earlier. MRSA infection could not have developed as quickly as the physician said; it probably started when pus began oozing from the nipple 3 weeks after childbirth.

PHYSICIAN’S DEFENSE The initial infection was in a clogged milk duct. Staphylococcal infection is rare in nursing mothers.

VERDICT A $200,000 Missouri verdict was returned.

Postpartum bleeding; then hysterectomy and chronic pain

TWELVE DAYS AFTER GIVING BIRTH to her third child, a 30-year-old woman went to the emergency department with heavy vaginal bleeding. An ObGyn, using ultrasonography, found pieces of placental tissue still attached to the uterine wall. He performed suction dilatation and curettage and prescribed medication to help the uterus contract. When the bleeding did not slow or stop, he consulted his partner.

During exploratory surgery, they found several sources of hemorrhage, including diffuse uterine bleeding. After trying to control the bleeding, they performed an abdominal hysterectomy; the woman had already lost one-half of her total blood volume.

PATIENT’S CLAIM The ObGyns were negligent in performing the hysterectomy. In addition to being unable to have more children, she also now suffers from chronic pain syndrome.

PHYSICIANS’ DEFENSE They did what was needed to save the patient’s life.

VERDICT An Illinois defense verdict was returned.

RELATED ARTICLE IN THIS ISSUE

10 practical, evidence-based recommendations for the management of severe postpartum hemorrhage
Baha M. Sibai, MD (June 2011)

Drug blamed for osteonecrosis of jaw

AFTER TAKING ALENDRONATE SODIUM (Fosamax) for osteoporosis for several years, a woman was found to have osteonecrosis of the jaw.

PATIENT’S CLAIM The gynecologist was negligent in prescribing alendronate sodium, which reduced the blood flow to her jawbone, leading to osteonecrosis.

PHYSICIAN’S DEFENSE The patient had a history of jaw problems. Her condition could have been caused by her use of steroids for pain resulting from an automobile accident.

VERDICT A New Jersey defense verdict was returned.

Sponge found during laparotomy

A WOMAN UNDERWENT a hysterectomy in September. She returned to her gynecologist in December with abdominal pain; a diagnosis of appendicitis was made. During emergency laparotomy, a surgical sponge was found in the abdominal cavity. A third surgery was performed because she developed an abdominal infection that required bowel resection.

PATIENT’S CLAIM The gynecologist was at fault for leaving the sponge in her abdomen during hysterectomy. The surgical nurses were at fault for reporting a complete sponge count.

DEFENDANTS’ DEFENSE The gynecologist maintained that he relied on the surgical nurses’ sponge count, and that he had been told it was correct.

VERDICT The hospital settled before trial. A Florida defense verdict was returned for the physician.

Dye not used after 2nd bladder repair; fistula develops

AFTER COMPLAINING OF PAIN, excessive menstrual bleeding, and anemia, a woman underwent a hysterectomy.

During surgery, her gynecologist injured, then repaired, the bladder. Indigo carmine dye test was performed; when dye indicated a second, smaller hole, the gynecologist repaired it with a figure-of-8 stitch. The dye test was not performed after the second repair.

The patient underwent repair of a vesicovaginal fistula 2 months later.

PATIENT’S CLAIM The gynecologist was negligent in using the figure-of-8 stitch in the bladder, and in failing to perform a second dye test that would have indicated an additional leak.

PHYSICIAN’S DEFENSE The figure-of-8 stitch was an appropriate technique to close the second hole. Performing another dye test would have stretched the bladder, weakening the sutures. A fistula is a known complication of a hysterectomy.

VERDICT A Missouri defense verdict was returned.

Should IUGR have been found “incidentally”?

SEVEN MONTHS’ PREGNANT, an obese woman was admitted to the hospital with hypertension. Dr. A, a hospital-employed ObGyn, discharged her after 3 days.

The woman returned to the hospital 1 month later, but refused to see Dr. A. Another ObGyn (Dr. B) was unable to find a fetal heartbeat, diagnosed fetal death, and performed a cesarean delivery. Fetal death was blamed on intrauterine growth restriction (IUGR). The parents requested an autopsy.

PATIENT’S CLAIM Dr. A should have diagnosed IUGR with ultrasonography when the woman was first hospitalized. The autopsy was not performed.

DEFENDANTS’ DEFENSE The hospital claimed Dr. A acted properly in not ordering the sonogram, based on the patient’s complaints and symptoms. The hospital also denied there was any duty to perform an autopsy; the cause of death had been determined.

VERDICT A California defense verdict was returned.

Should conservative care trump surgery?

A 38-YEAR-OLD WOMAN WAS REFERRED to a specialty clinic for management of severe urinary stress incontinence and pelvic prolapse. A gynecologic surgeon performed mesh repair of the prolapse, and cystocele repair with bilateral sacrospinous ligament fixation and a prepubic transvaginal sling.

After surgery, the patient suffered increasing pain and fever. Diagnostic laparoscopy failed to find a suspected bowel perforation. An intravenous pyelogram revealed a left ureteral injury; the patient was transferred to another hospital for stent placement. The woman later developed a vesicovaginal fistula, with mesh erosion into the bladder.

PATIENT’S CLAIM Conservative treatment should have been offered first. Too many procedures were performed during one operation, increasing the risk of complications.

PHYSICIAN’S DEFENSE The patient declined conservative treatment. Her severe symptoms required multiple procedures within one operation. The complications that she developed were known risks of the procedures.

VERDICT A California defense verdict was returned.

Mother dies right after birth of twins

BECAUSE OF HER HISTORY of previous obstetrical complications and two cesarean deliveries, a 29-year-old woman, pregnant with twins, was under the care of a high-risk obstetrics clinic at a university hospital.

The patient was hospitalized for 6 days because of preterm contractions, then seen several times in the clinic. Her family testified that she was told to be on bed rest, and that she had complied.

Three weeks after discharge, she delivered twins by cesarean. As delivery was completed, she became unresponsive. Resuscitation attempts failed. An autopsy revealed a massive saddle pulmonary embolus. It had likely broken off from a deep vein thrombosis (DVT) in the legs or pelvis.

ESTATE’S CLAIM When bed rest was recommended, she should have been started on DVT prophylaxis.

DEFENDANTS’ DEFENSE The ObGyn and hospital claimed that no restrictions were placed on the woman’s activity following discharge from the hospital for preterm labor. Standard of care requires DVT prophylaxis for patients with a prior history of clots or thrombophilia; the decedent had neither of those conditions. Heparin was not indicated because it would increase the risk of bleeding and cause anesthesia risks. Mechanical prophylaxes such as TED hose and sequential compression devices have not been proved effective in preventing pulmonary embolism or death.

VERDICT An Illinois defense verdict was returned.

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Breast infection misdiagnosed;MEDICAL VERDICTS;notable judgments and settlements;clogged milk duct;antibiotic;methicillin-resistant Staphylococcus aureus;MRSA;verdict;postpartum hemorrhage;hysterectomy;chronic pain;osteonecrosis;Fosamax;alendronate sodium;retained sponge;bladder repair;vesicovaginal fistula;intrauterine growth restriction;IUGR;urinary stress incontinence;pulmonary embolus;deep vein thrombosis;Medical Malpractice Verdicts;Settlements & Experts;Lewis Laska

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Breast infection misdiagnosed

PHYSICIAN’S DEFENSE The initial infection was in a clogged milk duct. Staphylococcal infection is rare in nursing mothers.

VERDICT A $200,000 Missouri verdict was returned.

Postpartum bleeding; then hysterectomy and chronic pain

PATIENT’S CLAIM The ObGyns were negligent in performing the hysterectomy. In addition to being unable to have more children, she also now suffers from chronic pain syndrome.

PHYSICIANS’ DEFENSE They did what was needed to save the patient’s life.

VERDICT An Illinois defense verdict was returned.

RELATED ARTICLE IN THIS ISSUE

10 practical, evidence-based recommendations for the management of severe postpartum hemorrhage
Baha M. Sibai, MD (June 2011)

Drug blamed for osteonecrosis of jaw

AFTER TAKING ALENDRONATE SODIUM (Fosamax) for osteoporosis for several years, a woman was found to have osteonecrosis of the jaw.

PATIENT’S CLAIM The gynecologist was negligent in prescribing alendronate sodium, which reduced the blood flow to her jawbone, leading to osteonecrosis.

PHYSICIAN’S DEFENSE The patient had a history of jaw problems. Her condition could have been caused by her use of steroids for pain resulting from an automobile accident.

VERDICT A New Jersey defense verdict was returned.

Sponge found during laparotomy

PATIENT’S CLAIM The gynecologist was at fault for leaving the sponge in her abdomen during hysterectomy. The surgical nurses were at fault for reporting a complete sponge count.

DEFENDANTS’ DEFENSE The gynecologist maintained that he relied on the surgical nurses’ sponge count, and that he had been told it was correct.

VERDICT The hospital settled before trial. A Florida defense verdict was returned for the physician.

Dye not used after 2nd bladder repair; fistula develops

AFTER COMPLAINING OF PAIN, excessive menstrual bleeding, and anemia, a woman underwent a hysterectomy.

The patient underwent repair of a vesicovaginal fistula 2 months later.

PATIENT’S CLAIM The gynecologist was negligent in using the figure-of-8 stitch in the bladder, and in failing to perform a second dye test that would have indicated an additional leak.

VERDICT A Missouri defense verdict was returned.

Should IUGR have been found “incidentally”?

SEVEN MONTHS’ PREGNANT, an obese woman was admitted to the hospital with hypertension. Dr. A, a hospital-employed ObGyn, discharged her after 3 days.

PATIENT’S CLAIM Dr. A should have diagnosed IUGR with ultrasonography when the woman was first hospitalized. The autopsy was not performed.

VERDICT A California defense verdict was returned.

Should conservative care trump surgery?

PATIENT’S CLAIM Conservative treatment should have been offered first. Too many procedures were performed during one operation, increasing the risk of complications.

VERDICT A California defense verdict was returned.

Mother dies right after birth of twins

The patient was hospitalized for 6 days because of preterm contractions, then seen several times in the clinic. Her family testified that she was told to be on bed rest, and that she had complied.

ESTATE’S CLAIM When bed rest was recommended, she should have been started on DVT prophylaxis.

VERDICT An Illinois defense verdict was returned.

Breast infection misdiagnosed

PHYSICIAN’S DEFENSE The initial infection was in a clogged milk duct. Staphylococcal infection is rare in nursing mothers.

VERDICT A $200,000 Missouri verdict was returned.

Postpartum bleeding; then hysterectomy and chronic pain

PATIENT’S CLAIM The ObGyns were negligent in performing the hysterectomy. In addition to being unable to have more children, she also now suffers from chronic pain syndrome.

PHYSICIANS’ DEFENSE They did what was needed to save the patient’s life.

VERDICT An Illinois defense verdict was returned.

RELATED ARTICLE IN THIS ISSUE

10 practical, evidence-based recommendations for the management of severe postpartum hemorrhage
Baha M. Sibai, MD (June 2011)

Drug blamed for osteonecrosis of jaw

AFTER TAKING ALENDRONATE SODIUM (Fosamax) for osteoporosis for several years, a woman was found to have osteonecrosis of the jaw.

PATIENT’S CLAIM The gynecologist was negligent in prescribing alendronate sodium, which reduced the blood flow to her jawbone, leading to osteonecrosis.

PHYSICIAN’S DEFENSE The patient had a history of jaw problems. Her condition could have been caused by her use of steroids for pain resulting from an automobile accident.

VERDICT A New Jersey defense verdict was returned.

Sponge found during laparotomy

PATIENT’S CLAIM The gynecologist was at fault for leaving the sponge in her abdomen during hysterectomy. The surgical nurses were at fault for reporting a complete sponge count.

DEFENDANTS’ DEFENSE The gynecologist maintained that he relied on the surgical nurses’ sponge count, and that he had been told it was correct.

VERDICT The hospital settled before trial. A Florida defense verdict was returned for the physician.

Dye not used after 2nd bladder repair; fistula develops

AFTER COMPLAINING OF PAIN, excessive menstrual bleeding, and anemia, a woman underwent a hysterectomy.

The patient underwent repair of a vesicovaginal fistula 2 months later.

PATIENT’S CLAIM The gynecologist was negligent in using the figure-of-8 stitch in the bladder, and in failing to perform a second dye test that would have indicated an additional leak.

VERDICT A Missouri defense verdict was returned.

Should IUGR have been found “incidentally”?

SEVEN MONTHS’ PREGNANT, an obese woman was admitted to the hospital with hypertension. Dr. A, a hospital-employed ObGyn, discharged her after 3 days.

PATIENT’S CLAIM Dr. A should have diagnosed IUGR with ultrasonography when the woman was first hospitalized. The autopsy was not performed.

VERDICT A California defense verdict was returned.

Should conservative care trump surgery?

PATIENT’S CLAIM Conservative treatment should have been offered first. Too many procedures were performed during one operation, increasing the risk of complications.

VERDICT A California defense verdict was returned.

Mother dies right after birth of twins

The patient was hospitalized for 6 days because of preterm contractions, then seen several times in the clinic. Her family testified that she was told to be on bed rest, and that she had complied.

ESTATE’S CLAIM When bed rest was recommended, she should have been started on DVT prophylaxis.

VERDICT An Illinois defense verdict was returned.

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Managing Your Dermatology Practice: Accountable Care Organizations

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Managing Your Dermatology Practice: Accountable Care Organizations

My recent post on the potential impact of Congress's 2010 health care legislation generated numerous questions about one of its centerpieces, the Accountable Care Organizations.

Many of those questions cannot be answered to anybody's satisfaction, because ACOs don't exist yet, and we won't know exactly what form they will take until finalized rules emerge from the Centers for Medicare and Medicaid Services (CMS).

ACOs are billed as Medicare's vehicle for "improving the quality and efficiency of care," which, in government-speak, typically translates to cutting costs.

The CMS envisions each ACO as a coalition of providers, hospitals, and suppliers working together to coordinate care for patients. Each will be run by a board composed of both providers and patients; increased patient input is a core tenet of the legislation. "We believe the best way to demonstrate a patient-centered program is for Medicare beneficiaries to have a voice in the decision-making process," the rule proposal states.

Medicare patients can join an ACO if they wish. Those who join can see any Medicare provider, inside or outside their ACO, and there is no penalty for going out of network.

What exactly will constitute an ACO is left vague. Since each ACO will be responsible for a minimum of 5,000 Medicare beneficiaries, any private health care organization of sufficient size, and with sufficient financial resources, could develop and operate one. This might include a primary care group or multispecialty clinic, a coalition of individual practices, a large teaching hospital, or a consortium of smaller community hospitals.

It is not clear how sparsely populated areas encompassing less than 5,000 beneficiaries will be accommodated. Equally undefined is the role of specialists; presumably they could join several different ACOs, or in some situations form coalitions of their own, but no guidance has been given.

The Department of Health and Human Services (HHS) will negotiate a 3-year contract with each ACO, set target spending goals – based on reducing the average per-patient spending by a specific percentage, as adjusted by "beneficiary characteristics," – and establish care-quality benchmarks.

Each ACO, in turn, will be required to define processes to coordinate care. Suggestions in the rule proposal include use of case managers, remote monitoring, and telehealth. Electronic health records will, of course, be strongly encouraged as well.

ACOs that "improve care" (read: save money) will divvy up the shared "savings" via an incentive system, and those that don't will be held accountable for "losses." Each ACO will decide how to distribute incentive payments among its member providers, hospitals, and suppliers.

ACOs can opt to share both savings and losses for the entire 3-year period, or they can share savings in the first 2 years and both savings and losses in the last year. The advantage, if any, in sharing savings without sharing losses is not clear to me – but I haven't made it through all 400 pages yet.

The buzzword, as I've said before, will be "outcomes" – the better your measurable results, the higher your reimbursements. This is supposed to reward quality of care over volume of procedures; but the result could be exactly the opposite if the smaller, community-based ACOs "cherry pick" the quick, easy, least risky cases, and refer anything time consuming or complex to academic centers.

Under current proposals, HHS rulings would be final: Eligibility for shared savings, percentages of shared savings received, and penalties (which include "termination" for failing to meet performance benchmarks) are non-negotiable. There is no provision for administrative or judicial review; nor is there any clue as to the fate of patients cast out of "terminated" ACOs.

ACO rules do not include private insurers or employers, but they will be permitted to form ACOs for their Medicare patients if they so desire. If the concept proves successful in driving down costs (don't hold your breath), look for private carriers to adopt similar models, each with its own completely different set of rules to add to the confusion.

As I mentioned a few months ago, this sounds like a large potential problem for private practice as we know it. But again, it's too early for reliable predictions; and we haven't even discussed other "reform initiatives" in the legislation, such as medical homes, value-based purchasing, and bundled payments. The next few years are going to be interesting.

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My recent post on the potential impact of Congress's 2010 health care legislation generated numerous questions about one of its centerpieces, the Accountable Care Organizations.

ACOs are billed as Medicare's vehicle for "improving the quality and efficiency of care," which, in government-speak, typically translates to cutting costs.

Medicare patients can join an ACO if they wish. Those who join can see any Medicare provider, inside or outside their ACO, and there is no penalty for going out of network.

My recent post on the potential impact of Congress's 2010 health care legislation generated numerous questions about one of its centerpieces, the Accountable Care Organizations.

ACOs are billed as Medicare's vehicle for "improving the quality and efficiency of care," which, in government-speak, typically translates to cutting costs.

Medicare patients can join an ACO if they wish. Those who join can see any Medicare provider, inside or outside their ACO, and there is no penalty for going out of network.

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Managing Your Dermatology Practice: Accountable Care Organizations

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