As CMS ramps up its efforts to drive clinicians toward accountable care organizations and Advanced Alternative Payment Models (groups taking on value-based care contracts), providers face a number of MIPS rule changes in Performance Year 2018.

Most notably, this involves the introduction of the cost measure performance category’s 10 percent weighting that transitions to 30 percent next year—almost a third of a provider’s MIPS score in 2019.

With that, it’s time for physicians to examine their data closely and work toward developing holistic strategies that not only improve patient care, but also significantly reduce expenses.

Developing a plan to address cost starts with curtailing inpatient care, the single largest contributor to overall cost of care. Avoiding inpatient care begins with focusing on Ambulatory Care Sensitive Conditions (ACSCs)—disease conditions in which early intervention can prevent complications or hospitalization.

To do this, healthcare organizations must help physicians identify high-risk patients via population health management (PHM) solutions and raise the level of proactive outreach. Otherwise, providers are waiting for patients to make an appointment for treating a health condition, or as is too often the case, head to an emergency department for urgent treatment.

One out of three emergency department visits are for non-emergency conditions, and per HealthEC data, one out of three ACSC-related ER visits ends up in hospitalization. Healthcare organizations must address populations compelled to choose the ER for conditions like upper respiratory tract infections or dehydration, which can be avoided with more proactive care.

High-risk and rising-risk patients should be encouraged to see their primary physician more frequently to monitor conditions, adjust treatments, and communicate openly about barriers to self-care. With the top 5 percent of high-cost patients consuming 50 percent of healthcare resources, a strong focus on this vulnerable population will yield great rewards in both quality and cost of care.

Further, by analyzing social determinants of health for high-risk patients and implementing a care coordination strategy that emphasizes individualized care, organizations gain new insights on how to care for certain patient populations and intervene accordingly. The likely result? Fewer trips to the ER as patients take control of their health.

Physician services is the second largest cost driver, but that’s not necessarily a bad thing. In fact, the more high-risk patients see their primary care providers, the less they are visiting specialists or the ER. It is critical to strike the right balance—seeing the right patients at the right frequency.

The next largest cost category is skilled nursing and long-term institutional care. If Medicare pays for 25 days of care in a rehabilitation facility, patients will typically stay the full 25 days. Organizations can have an impact on institutional care costs by focusing on milestone-driven discharges.

Promoting the use of outpatient facilities for services like radiology or rehabilitation is the fourth major cost savings opportunity. Reimbursement for these same outpatient services in hospital and institutional based facilities is much higher than freestanding private providers, so redirecting patients to outpatient facilities can result in considerable savings.

Reducing pharmaceutical costs is another highly discussed industry topic. Efforts to substitute generic alternatives for brands where possible and reduce unnecessary antibiotic use are the low-hanging fruit. With that in mind, there will always be expensive drugs and there will always be conditions for which no easy answers or solutions are readily available to avoid high drug costs, such as hepatitis, HIV and cancer.

The good news is that providers have a number of options to reduce care spending and ensure their success under MIPS for the approximately 30 percent of patients enrolled in the Medicare program. However, it is wise to remember that every VBC agreement put forth by government and commercial payers requires performance on these same quality measures, and that’s how the world of revenue and reimbursement is going to change. In the end, all of these MIPS-related measures will play a much bigger role in total revenue for the practice and physician.

So how can an organization take steps in the right direction? Here are some suggestions:

  • Look carefully at EMR templates to ensure inclusion of the appropriate quality metrics, and work to make certain those fields are completed at every visit.
  • Empower team members within the practice to help remind providers about care that should be completed during each patient’s visit to the office.
  • Employ technology to identify high-risk and high-cost patients and develop a strategy to more actively manage their care.
  • Add members to the team who can manage your high need patients, such as care coordinators, health educators and social workers, as their costs will be dwarfed by the savings that are realized.

As organizations explore ways to reduce costs and position themselves to better take advantage of CMS incentives, they will, in effect, deliver on the promise of value-based care and reap the benefits across all payer contracts and programs.

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