Jul 19, 2018 9:00:00 AM

Getting it Right: Traits of Effective Physician Compensation Models

As value-based payment models gain traction, healthcare organizations are feeling pressure to control costs and improve the quality of patient care, all at a time when the supply of physicians is falling short of demand.

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Topics: Physician Compensation, Value-Based Care

Jul 12, 2018 10:00:00 AM

How Will You Win the War for Physician Talent?

Competition for physicians is already heated. It’s about to get scorching. Demand is on a trajectory to drastically outpace supply, with a projected shortage of up to 120,000 physicians by 2030, according to the Association of American Medical Colleges.

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Topics: Physician Compensation

Feb 16, 2018 1:30:00 PM

CMS Bundled Payment Train Back on Track. Should You Board?

After scaling back its two mandatory bundled payment programs last year, CMS recently signaled that the value-based payment train remains on track for the current administration.

Bundled Payments for Care Improvement Advanced (BPCI-A) opened to applicants on January 11. With the application deadline of March 12, 2018, just around the corner, the pressure is on to decide whether your hospital or physician group practice is going to participate.

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Topics: Physician Compensation, Payment Models

Feb 23, 2017 10:00:00 AM

3 Steps to Reduce Fraud and Abuse Compliance Risks in Hospital-Physician Deals

The most astute executives in health systems are rightfully concerned about compliance risks in physician contracting. Among these risks are that a transaction or an arrangement between a hospital and a physician are consistent with fair market value (FMV) and are commercially reasonable (CR) as those terms are defined in the healthcare regulatory context.

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Topics: Physician Compensation, What is Fair Market Value

Nov 15, 2016 11:00:00 AM

My Hospital System is Losing Millions on Physician Practices. Is it a Death Sentence?

Recent DOJ settlements provide clear evidence of the position of qui tam relators, prosecutors, and government experts that hospital losses on physician practices are clearly targeted. For example, in U.S. ex rel. Parikh v. Citizens [No. 6:10-cv-00064 (S.D. Tex.)], the court denied the defendant hospital’s motion to dismiss in part because of an inference between the plaintiff’s allegations of practice losses and improper remuneration to induce referrals.

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Topics: Physician Compensation

Jul 12, 2016 11:00:00 AM

Setting Quality Metrics for Value-Based Pay - Part One

Government and commercial insurers are transforming payment models from fee-for-service (FFS) to arrangements that include incentives for quality, outcomes, improved patient satisfaction, and reduced cost. In the FFS environment, hospitals, physicians, and other providers have been subjected to insignificant financial risk relative to the risk borne by payers; however, with time, transformed payment arrangements have encouraged, if not required, more providers to assume downside risk. Why? One reason is to hold providers accountable for the cost and quality of care. The table below by The Commonwealth Fund summarizes this need by showing where the United States ranks relative to other industrialized nations in health outcomes and risk factors:

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Topics: Physician Compensation, Value-Based Care

Jun 14, 2016 11:00:00 AM

What Will Future Physician Compensation Look Like?

Currently, one of the more perplexing issues around fair market value physician compensation relates to designing comp models that effectively reward physicians for quality and cost savings in a market that is still driven by fee for service (FFS) reimbursement. Compliance-minded hospitals are understandably concerned about adopting (seemingly aggressive) models that stack quality payments on top of existing FFS models, particularly if total compensation exceeds what is commonly considered outside the upper range of FMV. Unfortunately, what those models should look like, especially what resulting (compliant) physician compensation should come from those models, represents somewhat unchartered waters.

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Topics: Physician Compensation, What is Fair Market Value

Apr 12, 2016 11:00:00 AM

3 Pitfalls to Avoid With Compensation-per-WRVU Contracts

Today, WRVUs are one of the most prevalent measures by which employers determine physician compensation.  WRVUs have the benefit of rewarding physicians for personally performed services based on relative values utilized by CMS without penalizing the physician for charity care provided on behalf of the hospital or for revenue cycle issues outside of the physician’s control. However, misconceptions still exist surrounding the selection of appropriate conversion rates for physician arrangements. Here are three common pitfalls to avoid when establishing a compensation-per-WRVU contract.

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Topics: Physician Compensation

Feb 25, 2016 10:00:00 AM

What You Need to Know About MACRA and FMV

Although physicians around the country cheered the permanent repeal of the sustainable growth rate (SGR), the resulting reimbursement and payment model changes could significantly impact the fair market value of physician practices. The passage of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) changed the valuation environment significantly. The HORNE Healthcare team has been researching the changes, and here is what you need to know:

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Topics: Physician Compensation, What is Fair Market Value, MACRA Summary

Feb 18, 2016 10:00:00 AM

How the Transition from Volume to Value Will Impact Your Physician Compensation Models

With the passage of MACRA in April 2015 we began to get some real clarity regarding Medicare’s plans for moving physician reimbursement from volume-based to value-based. With MACRA set to be implemented over the next few years, now is the time to begin addressing how changing reimbursement will impact physician compensation models. Because future reimbursement will be greatly impacted by physicians’ ability to deliver value and quality, hospitals will need to design compensation models that reward and encourage physician behaviors that support these goals.

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Topics: Physician Compensation, Value-Based Care

Feb 10, 2016 7:39:22 AM

How’s the Volume-to-Value Transition Working for YOU?

After our second day at the AHLA Physicians and Hospitals Law Institute, some clear themes are beginning to come into focus around the volume-to-value transformation in physician compensation. Quality-based compensation is fraught with challenges—quantifying value as compared to physician productivity is foreign to many. Also, missteps in the implementation can wreck the entire process.

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Topics: Physician Compensation, Value-Based Care

Jan 28, 2016 11:00:00 AM

Are Quality Bonuses Right for Your Medical Directors?

While the market gradually moves toward value-based reimbursement, hospital payments to physicians have also been in transition from purely productivity-based pay to incentives based in part on quality, patient experience, and efficiency of care. This shift has taken place in employment, professional service agreements, alternate delivery models, and clinical co-management arrangements, among others. Also included in this list are administrative service positions, such as medical directorships.

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Topics: Physician Compensation

Jul 9, 2015 1:00:00 PM

Why Relying on a Physician Income Statement for a Subsidy Payment is Risky Business

Stipends (or subsidy payments) are an area we are seeing a lot of activity in lately. It is not uncommon in the market for hospitals to subsidize physician groups in order to ensure physician compensation at market levels, particularly in markets that are heavily impacted by low reimbursement rates. From a compliance standpoint, one of the biggest issues is whether or not the subsidy payment represents fair market value (FMV). While it may seem straightforward, taking a physician group’s historical income statement (or in cases of a start-up venture a financial statement projection) at face value for paying a stipend is a bad idea. Why? Because without dissecting the various components you don’t really know what drives that number. You don’t know if market factors contribute to the loss, if the practice’s loss is due to internal operating characteristics or, as in many cases, a combination of both. So what do you look for? Below are three critical areas of any group’s income statement that should be examined, and if necessary adjusted, to determine true market driven subsidy needs.

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Topics: Physician Compensation

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