Top 10 Ways to Reposition Service Lines for an Accountable Care World
Many hospitals and health systems have spent the last few decades focusing on key service lines to establish Centers of Excellence that will attract patients to their hospitals, improve their overall reputation, and enhance financial viability. Historically, hospitals have utilized program development, marketing/branding campaigns, and loose affiliation with their physicians to improve service line performance. However, will these strategies be enough to be successful in an accountable care world? How will strategies need to be modified to thrive in the dynamic environment of value-based purchasing? Here is a list of the top ten ways to reposition service lines for an accountable care world.- Honestly assess the service lines in terms of what is critical in the new environment. In order to be successful in the future, organizations will need to demonstrate value (i.e., reduced costs, increased efficiency, improved quality), coordinate care along the continuum (e.g., reduce avoidable readmissions, encourage preventive care), and become clinically integrated. Honestly and objectively assess the organization performance and capabilities to determine each service line’s strengths and weaknesses. Are tools and resources in place adequate to deliver and demonstrate value (e.g., strong physician leadership, integrated clinical information, consistent use of evidence-based protocols, and collaboration across the continuum)? Is the volume adequate to assure care team proficiency and meet payer thresholds?
- Prioritize the organization’s focus. Many hospitals have tried to develop numerous service lines simultaneously to varying levels of success. Through an assessment of each service line, identify those in which the hospital is best positioned for success and focus energies in strengthening these key areas; carefully consider resource allocation and/or partnerships for those services that are unlikely to meet the market’s future expectations for value.
- Identify and develop physician leadership. One of the most crucial success factors in accountable care is that it is physician led. For most physicians, the skills needed to lead these efforts are not skills that they have previously developed or received in their training (e.g., consensus building, management, and leadership skills). Identify physician leaders within the organization and take the time and allocate the resources to educate and develop them for their changing roles. If necessary, determine whether outside leadership/expertise will be needed to lead the service line.
- Implement structures that give responsibility and incentives to physicians for the management of patient care and overall performance of the service line. This may include co-management agreements or physician employment with performance- based compensation. Compensation incentives are currently misaligned now between hospitals and physicians. Historical methods to align incentives such as medical directorships and ED call agreements are insufficient to develop accountability for the performance of the service line. Developing alternative structures, such as physician employment with compensation based in part on the achievement of key service line performance metrics or co-management agreements that reward achievement and provide accountability for service line performance among a group of physicians, are a critical element of success. Metrics and performance measures should be balanced with financial and quality indicators to include outcome metrics, coordination of care, efficiencies, and expense management.
- Negotiate with payers for compensation structures that align financial incentives, such as bundled payments, gain sharing, shared savings. Bundled payments for an episode of care (e.g., heart surgery, joint replacement) provide one payment for all care provided to the patient -- inpatient, outpatient, physician fees, and readmissions -- for a designated period of time (e.g., 3 days pre and 30 days post procedure). CMS will be expanding their Acute Care Episode (“ACE”) pilot to additional states by 2013, if not sooner. In the meantime, aggressively negotiate with other payers to establish new compensation models that reduce variation, improve quality, and lower cost, providing the financial incentives to transform the delivery of care.
- Standardize care process/protocols. Reducing variation, eliminating waste and duplication, preventing avoidable readmissions, and maximizing quality care are critical to success. Identify, develop, standardize, and use evidence-based protocols to improve the service line’s value. Use timely feedback and reporting tools to assure adherence to the protocols.
- Eliminate silos and focus on the continuum of care. Changing the mindset from “my area” to the broader view of the overall patient’s care is a critical part of redesigning the care process. Physicians and management will need to expand their view outside of their practice and/or the hospital to maximize the coordination of care for the best outcome for the patient. This will require proactive care management with a focus on the patient’s condition before admission, real-time concurrent review and optimizing the use of other levels of care such as remote monitoring and home health to keep the patient healthy and avoid emergency room visits, as well as preventable admissions and readmissions.
- Redefine the role of the service line leader. Redesigning the service line leader’s roles, responsibilities, and resulting skill set needed to succeed is an important initial step in the transition. Historically service lines have been hospital-centric and led by a nurse and/or MBA, who were focused on keeping physician customers satisfied, increasing volume, and accommodating multiple physician preferences. In the new era, service line leaders will need to partner with physicians by having them take accountability and responsibility for achieving and demonstrating value through use of evidence-based protocols, integration and coordination along the continuum, and meeting established metrics for quality, efficiency, and cost. Additional education may be needed to develop this new perspective, interpersonal skills, and business acumen needed in the future.
- Leverage information technology (“IT”). Use IT to compile complete information about the care a patient has received regardless of the setting (e.g., physician office, outpatient, freestanding surgery, imaging or labs, post acute, inpatient hospital) and utilize that information at the point of care to identify the best care plan; consistently provide high quality care; eliminate waste and duplication; and proactively manage a patient’s health. IT systems should also be leveraged to proactively identify high risk patients through a data warehouse and use of predictive modeling, identify trends, and benchmark to best practices.
- Create a culture of continuous improvement. Transforming the delivery model will take time, so it is important to start now in order to be ready for accountable care organizations (“ACOs”) beginning 2012! This transition will take many years and is more of a journey than a destination. Mature organizations that have developed many of these skills over decades are still constantly looking at how to continually improve. Creating a culture in which people are continually excited and motivated to improve care is essential to the long-term success in an accountable care world.
For previous Top 10 lists, please visit our Resource Center.
