Issue link: https://beckershealthcare.uberflip.com/i/501108
48 Executive Briefing: Practicing Orthopedics in a Bundled World Syncera, powered by Smith & Nephew, offers hospitals and other healthcare providers a pioneering delivery model for clinically proven primary total hip and knee products using cutting-edge technologies that streamline the orthopedic service offering and provide attrac- tive economics. For more information visit www.syncera.com. Third, build a dedicated team, which will include physician leader- ship. Fourth, define the episode of care, noting the inpatient and post- discharge period. Fifth, since quality and value equal outcomes divided by cost, it is important to collect outcomes data as well as reduce costs. Therefore, develop and define the performance metrics, which must include outcomes as well as cost. Sixth, develop the care pathways and models in attempts of achieving standardization. Use protocols that become templates as a guide for each patient's episode of care, which can be used to monitor compliance and compare to "best" practices. Seventh, cost reduction opportunities include waste elimination and negotiating lowering implant costs to allow price establish- ment. It is important to make certain that these cost reduction opportunities do not affect the quality of the current products or episode of care. Value shares: Gain sharing and co-management One method for the surgeon group to benefit from achieving cost savings in these bundled payment programs is through "gain-shar- ing," which is specifically authorized under the BPCI programs. These payments must be related to "changes in behavior and/ or an increase in quality." Care must not be reduced and quality must remain constant or improved under this arrangement during the course of the contract. Also, compliance with the overarch- ing federal legislation (Anti-Kickback Statute, Stark Law, federal civil monetary penalties law and the False Claims Act) must be followed. Gain-sharing can also be utilized by hospital-employed physicians in conjunction with the hospital. Another method for surgeon group benefit through cost reducing programs is utilizing gain-sharing models between hospitals and physicians within a co-management agreement. In this frame- work, gain-sharing can be extended beyond the initial year of sav- ings for up to three years and possibly even further. Co-management agreements are legal between hospitals and physicians or physician groups, and they give the surgeon control over the care their patients inside the hospital. Compensation is structured based upon the work the physician actually performs on an hourly basis for managing the care process in areas such as but not exclusive to: the operating room, inpatient unit, physical therapy, case management, personnel, etc. Surgeon compensa- tion also occurs for achieving certain quality metrics such as, but not exclusive to: on-time starts in the operating room, day of sur- gery ambulation, achieving programs for block scheduling, patient satisfaction scores, etc. Governance in the management company is shared between the hospital and physicians. The surgeons are reimbursed for services provided by the management company. Physicians will be reimbursed in the future by earning a negotiated portion of bundled payments that are given to the hospital for the service delivered by the hospital and the surgeon. As previously noted, multiple groups can be involved in this type of relationship with the hospital. Tools for success in a "bundled world" To achieve gain-sharing within the co-management agreement and make it profitable for the surgeon group or hospital-employed physician, it is critical to engage in "case-costing." To date, the most significant portion of the expense of a total knee or total hip replacement, especially one performed in a same-day outpatient setting, is the cost of the implant. Depending on geographic location and implant type, this can be as much as 70 percent of the entire procedure. This disparity of cost burden highlights a need for further disruptive innovation, which can enable superior outcomes while improving both cost and, more importantly, quality with new tools. Therefore, building a program around a technology enabled delivery model across a pre-operative, intra-operative and post-operative care continu- um might yield the changes needed to succeed in these times of change. One such model is described below. Operating room staff and surgeons can boost efficiencies of oper- ative and turnover time while tracking and eliminating costly waste in the process with pre-operative staff competency training utiliz- ing a personalized, digital learning management system. Intra- operative "error-checking" software assures the quality of selec- tion and utilization with clinically proven implants that have shown strong survivorship (>95 percent) across a critical timeframe (12 to 15 years). Finally, an automated supply re-order at the point- of-care in the OR ensures timely delivery of the right resupply in the most cost-effective pathway during the post-operative phase. Through such a model, the surgeon, hospital and patient can be more assured of both a predictable and long-term successful re- sult. Moreover, this model could return an attractive revenue stream back to the surgeon participants, both legally and ethically, through its apparent beneficial impacts throughout the episode of care. Summary and conclusions A quantum shift in payment mechanisms for healthcare delivery is underway beginning with Medicare. With declining physician reim- bursement and the requirement that bundled payments be enacted in 50 percent of Medicare cases by 2018 and 100 percent by 2020, it will be necessary for surgeons and hospital systems to prepare for this inevitable transition to value-based bundled payments and away from fee-for-service reimbursement while recognizing that private payers have traditionally followed Medicare's lead if they too can re- duce costs through a different reimbursement model. Therefore, a new path should be explored — collect outcomes using clinically proven devices at a reduced cost, streamline the supply chain management with automated tools, and prevent past quality issues around in-OR errors to improve quality. This will be paramount to maintain reasonable reimbursement for work per- formed by an orthopedic surgeon in the new normal of reimburse- ment for healthcare delivery. n