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Physician Compensation Updates

The term “physician compensation” could be among the top phrases in health care this year. The plan that would replace a fee scale that compensated doctors more for seeing sicker patients with a flat-fee model that reimburses them at the same or similar rates regardless of the condition being treated or complexity of the visit has been introduced.

Steps You May Need to Take:

The majority of today’s compensation plans are still heavily production based and measured by relative value units, clinic visits, or panel size, with just a small proportion of incentive based on quality, access, or patient satisfaction. Going forward, these compensation plans will need to be updated and revised to encourage the practice habits that will drive quality and performance.

Involve all your clinicians now

The vast majority of organizations are not engaging with clinicians to implement the necessary day-to-day practice changes that will allow them to meet new quality goals, and that is setting their clinicians up for a rocky, and potentially expensive, transition to MIPS-based payments.

Practice changes that will help clinicians meet new goals include:

  • More rigorous application of evidence-based medicine pathways to standardize treatment regimens, thus ensuring both their efficacy and efficiency
  • Improved application of electronic technology to improve the clinician’s care and efficiency
  • Better delegation of routine tasks to other office personnel and constant attention to proactively identifying and meeting the needs of their “attributed” patient population
  • Move your current compensation system heavily in the direction of rewarding for value

To align behavior with expected outcomes and performance, a substantial part of total market competitive compensation – 20 to 25 percent – should be dependent on adherence to evidence-based medicine pathways and a small number of the other parameters in MIPS.

Be mindful of real-time performance payments

The proposed regulations suggest that poor performance at a group or organizational level be translated into individual compensation and not held solely at the group or corporate level. Given this, organizations must be thoughtful about the timing, conditions for, and amounts of any interim real-time performance payments – pending the final determination of any changes to Medicare payments.

Step up your EHR game

There is a need to feed performance back to clinicians on an annual schedule, but that is no substitute for real-time reporting. Medical groups and hospitals should take the lead on monitoring clinician behavior and providing feedback which will emphasize on the functionality of the electronic health record and the robustness of its reporting capability.

In addition, any compensation plan that focuses on the quality standards established by MIPS will depend on clinicians fully utilizing appropriately configured Certified EHR Technology (CEHRT). Hence, EHRs most likely will have to be reconfigured to “optimize” to the specialty; and get the documentation done with MIPS requirements for reporting.

Be mindful of anti-kickback and other statutes in your redesign

New plan designs must be very mindful of the Stark Law, the Anti-Kickback Statute and IRC 4958, which prohibit payment-for-referrals and ensure physicians are not overcompensated based on nationally derived and specialty-focused survey data.

Due to the regulatory concerns around physician compensation and the myriad complexities of compensating these highly skilled and sometimes specialized and unique providers, maintaining consistent oversight can be challenging. Establishing some routine scheduled maintenance can make it significantly easier to ensure that your organization’s physician compensation program remains on track.

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