Start Getting Ready for Value-Based Pricing in Your Practice
Do the thing. Write down the code. Get paid for the thing.
Fee-for-service pricing in healthcare has been an established fact of life for the last 75-some-odd years. There was a time where it made all the sense in the world—as healthcare grew more specialized, specificity in billing was a necessary evolution.
There’s a growing sense, though, that fee-for-service may have, like the ’82 Chevy Cavalier you tried to drive through your 20s, outlived its usefulness. That a fundamental change in physicians’ reimbursement is on its way.
Value-based pricing is coming, and it just might be coming faster than you think. It could be a year, or maybe two. But by now, you’ve noticed in your own practice that it’s something Medicare is actively encouraging.
The problem is that plenty of physicians have already done a good job gaming the system, performing procedures that may not be necessary in order to increase their billing. Value-based pricing, where patient outcomes dictate reimbursement, is the alternative.
Medicare already discourages doctors from not filing quality reports with reimbursement penalties that can reach up to 5 percent. There’s been some talk about offering an incentive bonus for submitting quality reports that can move the needle up to 5 percent the other way—making massive, six-figure swings in yearly reimbursement very much a possibility.
“What we’re trying to do is reset the map and really make the destination patient cure, or getting the patient to where they want to go instead of just maximizing the billing for the doctor,” IBP’s Dr. Steven Kozmary said. “If you pay someone to do something, they’re going to do more of those things. What’s going to happen is there’s going to be a change in the landscape for practices and everybody is going to have to reset their sights on what are we trying to accomplish here?
“With electronic medical records there’s a tremendous amount of data being generated, captured, sent to the government and to the supervising agencies. They’re going to be looking at it, and big data analytics are now kind of coming into their own with ways to get their arms around it. I think a lot of this work is for the better. The docs really need to be on board with getting the patients better instead of just doing procedures.”
Big data is the key to this. Patient surveys can offer up a wealth of information concerning outcomes, and the raw computing power is enough to sort those surveys well enough to establish accepted population means.
With Medicare already leading the way, it positions value-based pricing as an inevitability. In some states, like Washington, patient surveys after operations are already required by law.
Are you a studious physician already attentive to recent developments in your field and tuned into patient needs? Then value-based pricing will reward you, as someone who stands out in your specialty. For patients, the hope is that it creates a rising tide for standards of service.
What can you do to put yourself in position for a seamless transition to value-based pricing? There are a couple of areas to start looking at.
“I think it’s a great time for physicians to understand that they’re going to really have to start caring about customer service,” IBP Managing Partner Glenn Truitt said. “There’s smaller stuff like be nicer, make it a nicer experience. That’s sort of the Yelp approach to this. The other side is to care about how your patients turn out. You’ve got to start really caring about how you perform. When this change happens, a lot of doctors are going to have no choice.”