Population health management and physician incentives go hand-in-hand

It’s no secret that high-risk patients take more care resources, and this is true when it comes to physician interaction at multiple levels. Unfortunately, high-risk population needs often are not typically reimbursable.

That means doctors may not be paid for services they provide to high-risk patients. Population health management (PHM) programs must build physician incentive programs into their overall models to ensure provider engagement in population management activities.

Some physician groups are already accounting for PHM incentives. At WestMed Group clinics in New York, there’s a plan in place to withhold five percent of gross revenues as an incentive to physicians to meet patient satisfaction and quality measures targets. Incentives are shared quarterly, usually at a meeting with the affiliated physicians present. Seeing one of their peers get a large incentive check for meeting quality metrics can be quite motivating. Miles Snowden, MD, MPH, CEBS Chief Medical Officer, OptumHealth

Incentivizing quality care will become more common. The country appears to be moving to a model where being paid to manage rather than treat patients will be the norm. Medicare is phasing out incentives for its Physician Quality Reporting System (PQRS) and is replacing them with penalties. In 2015, providers who fail to report enough quality measures will lose 1.5 percent in reimbursement. That penalty rises to two percent in 2016.

Ensuring your physicians meet quality measures—especially for Medicare—is critical to a strong bottom line. Incentives are a good way to go, but you need to make sure the right variables are in place. A critical component is managing a sufficient number of patients, while keeping volumes from getting too out of hand.

“I’m not going to get a great response if I go to a physician and say, ‘You manage 20 of my members; I want you to spend additional clinic time with them’, said Dr. Efrem Castillo of WellMed Medical Management. “To ask someone to alter the way they practice for just 20 patients – that is a tough pill for anyone to swallow.”

But a word of warning: Don’t get in the habit of using practicing physicians as care management team leaders. Said Simeon Schwartz of WestMed Group: “You cannot continue to flog the primary care physician with more work and more responsibilities and expect their productivity won’t suffer.”

Incentives can work in getting physician engagement for population health management. In our next post, we’ll talk about a key ingredient that can’t be overlooked when building your model: the patient.

To read more about transparency’s role in PHM, download the white paper:   “Managing Populations to Improve Individual Care: Best Practices for Physician-based Population Health Management.”

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