10 Ways Market Changes Will Reshape Physician Practices

Laura P. Jacobs, MPH


November 07, 2012

In This Article

Market Changes Affecting Physicians

2. New Payment Models Are Becoming More Common

PPACA called for a variety of different changes to payments that are made to hospitals (eg, value-based payment and penalties for excessive readmissions). The act also introduced accountable care organizations (ACOs); and, through the Center for Medicare and Medicaid Innovation (CMMI), bundled payments are being piloted, among other initiatives.

Physicians are at the center of these models, all of which require more effective coordination of care, quality measurement, and overall cost reductions. In 2012 so far, the Centers for Medicare and Medicaid Services has identified 32 organizations as Pioneer ACOs and another 89 for the traditional ACO model, which began functioning in July 2012. Applications were due in September for the next round to begin in January 2013.

Medicaid in many states is moving to managed care plans or piloting bundled payment and other similar value-based payment models. The level of activity is high in many markets in one or more of these models -- patient-centered medical home, bundled payment, ACO, or pay-for-performance -- and physicians must be aware of who is leading these initiatives and what opportunities or risks may be present by participating or not participating in the models emerging in their region.

3. Public Reporting of Quality Measures Is Here to Stay

The impact of the measures can be debated, but the fact is that the tenets of healthcare reform include a heightened level of transparency of provider performance on a variety of measures, such as adherence to protocols, patient satisfaction, and patient outcomes.

Medicare's Physician Quality Reporting System was expanded in the ACA, and beginning in 2014 those physicians who don't participate will begin to be penalized. Results will be posted publically on the "Physician Compare" Website, which is similar to what is already available for hospitals (Hospital Compare) and is currently under development.

Know your scores and how you compare to your peers locally and across the country. It's better to take action now in any area where your results are less than desired -- before both public reporting and payment are tied to these measures.

4. Electronic Medical Records Are Essential for Physician Practices

Electronic health records (EHRs) are no longer a novel or rare occurrence; a recent study by the Centers for Disease Control and Prevention indicated that over 55% of physicians had implemented an EHR.[1] Further, the incentives provided for in the American Recovery and Reinvestment Act of 2009 turn to penalties after 2015 if physicians fail to meet the criteria for "meaningful use."

The fact is, though, that many medical communities are seeking to create clinically integrated networks by facilitating sharing of clinical data across different EHRs -- through Health Information Exchanges and Clinical Data Repositories. These clinically integrated networks will enhance physicians' ability to succeed under value-based payment and can be the precursors of ACOs or integrated delivery systems. At any rate, the implementation and effective use of EHRs is an expectation in today's world.