The Changing World of Healthcare Providers

Wishbone Spiral

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Better outcomes, more value

The changes in healthcare are occurring on many fronts and with increasing speed. The simple driver is that utilization is up due to population growth, a higher percentage of covered lives and an aging society. Consistent with this, costs are up due to the growing number of patients, the sophistication of the treatments and the rising costs of technology and prescriptions. The US healthcare per capita spend in 2000 was $4,857. By 2014, it was $9,523; that’s a growth rate of 5.3% per year. For the US, this amounts to over $3 trillion per year or 17% of Gross Domestic Product. As a result, the overall system is resource constrained and economically stressed, which is leading to more stringent upfront testing, the requirement for better outcomes, and the utilization of alternative lower cost treatment venues.

Wishbone Spiral

Welcome to the World of Multiple Payers

The combination of slow economic growth over the last decade, along with increasing costs, has meant government and employers can no longer absorb all of the expenses, consequently they are pushing them to different entities. This forces tough decisions on who pays for the care, how and where it is delivered, and who receives it. Recently we have seen:

  • The popular silver-level plan under Obamacare surge 11 percent on average for 2016, while yet another increase is planned for 2017.
  • Commercial payers have filed for increases in 2017 of 10 to 20 percent and others have announced they will drop coverage in some states.
  • Escalating plan premiums have forced patients into higher deductible plans.

The underlying assumption is if patients have to assume more financial responsibility they will make more prudent choices on the care they demand. We can expect more transparency in the form of outcomes and cost tracking data to enable informed decision making.

Welcome to the World of Patient Centered Healthcare

The transition to different delivery models is already underway, as evidenced by the 500+ ACOs currently operating and hundreds of pilots in the test phase. Beyond this, “HHS has set a goal of tying 30% of traditional fee-for-service Medicare payments to quality or value through alternative payment models, such as Accountable Care Organizations (ACOs) or bundled payment arrangements by the end of 2016, and tying 50% of payments to these models by the end of 2018 . . .” The impetus is the belief that all of the patient’s providers working together to determine the course of treatment will lead to better outcomes, and that a shared payment system will provide the incentive necessary to force this collaboration.

Why is this relevant to us? The basic fact is almost 70 percent of a hospital’s revenue and 60 percent of their margin comes from perioperative services. Surgical first assists are directly in the middle of the intersection of outcomes, revenues, and cost control. We have to be proactive by looking in all directions for ways to support the hospitals’ and surgeons’ efforts to participate effectively in this new world. We must change our behavior, processes, protocols, and activities, because the definition of what constitutes satisfactory performance in surgical assisting is changing. The bar is being raised.

Better outcomes require proficient and highly trained clinicians in all aspects of the perioperative arena. Patient-centered healthcare means being prepared at all times, knowing both the patient’s condition and the surgeon’s preferences, as well as being part of the entire OR team from start to finish. The surgical first assist is like the suture running through the entire surgery process, holding it all together. High performing assistants are engaged in all aspects from beginning to end; there is no place for arriving late and leaving early. Observation, experience and motivation are the keys to anticipate needs and take action before a condition becomes an emergent crisis. This behavior generates value for the entire team, and it can also shorten case times while improving the outcomes.

Welcome to the World of Value-Based Purchasing

The new norm is value-based purchasing. This means that providers will be paid in accordance with the amount of value produced, relative to an existing benchmark. Bundled payments and ACOs drive team-based behaviors, thus qualifying the entire team to share in the bonuses attributed to better service and improved outcomes. Being part of an ACO or a bundled payment scheme – which can include treatments before the surgery to as much as 90 days after the surgery – means the total payment must be divided among the participants. In order to receive a fair share for assisting services, we must demonstrate exceptional clinical proficiency under normal and unexpected situations; this also includes maintaining an appropriate demeanor at all times. Even the Joint Commission recognizes the importance of this capability… “never-happen” and “emotional blow-ups” are designated as reportable incidents, requiring a “root-cause” analysis.

Performing at the top of our capabilities and credentials at all times is essential. We must be conscious of every aspect and person in the entire process. Furthermore, successful relationships demand dialogue and good communication in order to ensure understanding. Keep in mind that, in addition to outcomes and cost control, hospitals are striving to improve their scores in patient satisfaction. A great percentage of patients’ negative comments arise from them feeling as if they are not “in the loop”. Communication in all dimensions plays a major role in satisfaction and, as we are seeing, compensation may be coming from multiple sources; commercial payers, facilities, surgeons, and patients. Making certain that patients know who we are or why we are in the room – whether by advance letter or in the hospital – will dramatically lower the resistance to our receiving fair compensation. Who understands our value better than us? This means it is up to us to demonstrate and communicate our worth and value.

Our clients have a choice, and we must earn their business and their trust. This means we must find ways to provide reliable service better, faster, and in a less costly manner. When it comes to forming the team and selecting the partners, why would the clinical team leaders tolerate partners that cannot create more value than they cost? If we are to continue to be the partner of choice, we must differentiate our services from those provided by all others. The mechanisms are straightforward… clinical skills, process execution, team spirit and communications.

About the Author

Thomas Kirk

Tom Kirk joined American Surgical Professionals as Chief Executive Officer in June of 2013. Prior to joining American Surgical Professionals, Mr. Kirk served as CEO and Director of Hanger, Inc. in Austin, TX, as well as Principal at Jay Alix & Associates in Southfield, MI. He has also held several leadership positions in large corporations serving in many positions, including finance, planning, and market development. Tom Kirk holds a PhD and an MBA from University of Pittsburgh, and a BS in mechanical engineering from Carnegie Mellon University.