Healthcare Issues & Trends

Advice & Insights for healthcare's Leaders & HR Professionals

Work RVU Production below the 25th Percentile – Work Harder!?

Posted on June 30, 2014 by Brad Lenertz

The internal medicine department of a hospital-owned multi-specialty group was due to have their contracts renewed. In keeping with their corporate physician compensation plan, the Physician Practice Executive Council commissioned a Fair Market Value analysis, which included a review of historical compensation and production. As a group, the five internists’ compensation and production levels hover at the median, per FTE. However, individual review shows there to be a significant deviation among the providers. At the low end, Dr. Lowe’s compensation and production levels fell below the 25th percentile.

An E&M coding analysis for Dr. Lowe led to the discovery that her coding practices varied greatly from the national coding practices of her peers. Theoretically, Dr. Lowe would not have to increase patient volumes in order to be more productive. If her work effort is documented to support the coding pattern of her peers, by accurately coding her work she would experience a 57% increase in productivity!

The same analysis was completed for the other internists. Only one of the physicians was found to have a coding pattern that resembled that of the national benchmark. The other three also showed potential for increased productivity between 18%-23%. For this small group of five internists, the total revenue opportunity that was identified exceeded $250,000.

The total Work RVU Production of a provider or group of providers is an indicator of their operational effectiveness. Groups of providers averaged together may hide the lower performance of individual providers, so it is important to fully understand the data on an individual provider basis. When normalized for a 1.0 FTE effort, individual providers whose performance is below the 25th percentile should have a clear understanding of what is impacting this performance. A review of the provider’s E&M Coding pattern as compared to CMS benchmark data may reveal helpful insight.

If your practice struggles with physician productivity below the 25th percentile, the answer may not be to get them to work HARDER, they may need to work SMARTER. INTEGRATED Healthcare Strategies not only has the expertise to help identify if working SMARTER is the right strategy, we offer solutions to help build systems and processes that educate and support them working smarter.

A Decrease in Healthcare Payments Brings Challenges and Opportunities for Healthcare Providers

Posted on June 24, 2014 by Gallagher Integrated

A volume to value transition has begun as hospitals and physicians face decreasing healthcare payments. As a result, they will begin to receive less pay per increment of service, which leads to the potential to force some out of the market. On the upside, payment deduction compels quality to move to the forefront. However, quality-focused healthcare produces some major challenges for a value-based system.


With this shift from volume to value, a traditional acute-care fee-per-service system will be the primary model. This will lead to certain challenges:

• More performance-based fee-per-service contracts

• Pressure to keep costs down

• Hurdles to get performance bonuses

• Difficult transition time


The key to undertaking these challenges is chronic disease management. In fact, 75-80% of healthcare costs are related to one of six chronic diseases—diabetes, congestive heart failure, coronary heart disease, asthma, depression and obesity. Acute care providers, such as hospitals and physicians, weren’t trained to address wellness and prevention health management issues that chronic disease patients need. Thus, public policy shifts must follow in order to address the needs of chronic patients and payment support.

An additional opportunity is technology. In order to successfully manage the health of the population, a good information system is vital to tracking patients over time. Some examples include:

• Information technology: provides electronic health records for providers and consumers; helps consumers to become better educated

• Clinical technology: inventing new tools to enhance patient care

• Telemedicine: changes venue from bricks and mortar to digital

• Big data: has the capability to make improve diagnostics and treatment

Watch the three-part video series, “Raising the Bar,” featuring Don Seymour and Dr. William Jessee, to further learn how to thrive in today’s evolving healthcare environment:

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The Current Trend Affecting Today’s Healthcare Environment | Background and Basis

Posted on June 10, 2014 by Gallagher Integrated

Hospitals and physicians are facing an ever-increasing trend in today’s healthcare industry: a decrease in healthcare payments paired with an increase in organizational risks. What does this mean? Payers are insisting that, in order to continue to be part of an insurer’s network, providers must assume a certain level of financial risk for the care provided.

Notably, the culprit of this trend in healthcare isn’t a major factor found exclusively in the Affordable Care Act; the ACA simply acted as a catalyst for events in the name of reform. A key impetus began in 2011; the first year the members of the Baby Boomer generation began turning 65. At that time, a large number of recipients began moving out of the private insurance market and into the Medicare insurance market, drawing upon the trend illustrated today.

To begin addressing this shift, the focus should be on neither one nor the other, but rather, on how to deal with declining reimbursements and recognize that an increase in risk leads to an increase in opportunity. Simply put, there is a need to embrace risk and determine how to manage it efficiently and effectively in order to create opportunities.

Click here to learn more and watch the three-part video series, “Raising the Bar,” featuring Don Seymour and Dr. William Jessee. And, don't forget to check out the infographic on pay and risk facts! 

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