Purchasers of healthcare are beginning to take a more active role in ensuring they receive value for their health care dollars, and these savvy shoppers want to develop programs to increase the quality and efficiency of the care they purchase. This movement has given rise to the concept of value-driven healthcare, commonly called value-based purchasing. Over the next three months, “From the College” will take a look at this type of purchasing and provide rheumatologists and rheumatology health professionals with practical advice on how to stand out to these value-based purchasers.
An August 2007 Commonwealth Fund report defines value-based healthcare purchasing as follows: “The concept of value-based healthcare purchasing is that buyers should hold providers of healthcare accountable for both cost and quality of care. Value-based purchasing brings together information on the quality of healthcare, including patient outcomes and health status, with data on the dollar outlays going towards health. It focuses on managing the use of the healthcare system to reduce inappropriate care and to identify and reward the best-performing providers. This strategy can be contrasted with more limited efforts to negotiate price discounts, which reduce costs but do little to ensure that quality of care is improved.”
Value-based purchasing is often associated with reporting on quality measures; however it is important to understand that value-based purchasing is a larger concept of which quality reporting is only one tool. Value-driven healthcare encompasses system redesign both of the greater healthcare system and payment structure and of practice systems and the processes of care delivery.
The History
Traditionally, value-based purchasing has existed in three basic models:
- Single large purchaser: Involves a large purchaser working actively and cooperatively with suppliers while using its market power to make demands;
- Purchaser coalition: Involves a group of public and private purchasers (commonly called a purchaser coalition) working together to standardize demands on suppliers and share value-driven strategies; and
- Mixed coalition: Involves a group of healthcare purchasers and suppliers working cooperatively to promote transparency and incentives.
Depending on the model, value-based purchasing programs employ a variety of strategies to increase the quality and efficiency of services provided for every healthcare dollar spent.
Although these concepts have been around for more than a decade, value-based purchasing is now finding legs in the U.S. healthcare system, largely due to the August 2006 executive order in which former president George W. Bush outlined the Value-Driven Healthcare Initiative and called on employers and other purchasers to use the following four cornerstones when they purchase health insurance:
- Interoperable health information technology;
- Reporting of quality-of-care measures;
- Reporting of healthcare price information; and
- Incentives for high-quality, cost-effective care.
Value-Based Purchasing in Medicare
The Centers for Medicare and Medicaid Services (CMS) is currently developing the tools necessary to achieve a system of value-based purchasing, and, in effect, transform their current role as a “passive payer of services into that of an active purchaser of higher quality, affordable care.” These actions are being taken to lessen the rapidly increasing cost of healthcare and to identify and encourage care delivery patterns that are not only high quality, but also cost efficient.
CMS is implementing the building blocks to support the establishment of a value-based purchasing program for health professionals. These include initiatives on quality and efficiency measurement and reporting, incentive alignment approaches, care coordination, prevention, and health information technology. In early 2009, CMS produced a Roadmap for Implementing Value Driven Healthcare in the Traditional Medicare Fee-for-Service Program, which can be found at www.cms.hhs.gov/QualityInitiativesGenInfo/downloads/VBPRoadmap_OEA_1-16_ 508.pdf. This report sets forth the vision of value-based purchasing as patient-centered, high-quality care delivered efficiently, and it details the many goals for value-based purchasing.
In order to move towards realizing these goals, the report states that CMS will need to work in partnership with physicians, providers, beneficiaries, Congress, and other stakeholders to create a healthcare financing system that promotes joint clinical and financial accountability. For this to happen, CMS will seek to restructure the payment systems to provide incentives for physicians and providers to work together to develop new ways to deliver high-quality, efficient care while maintaining beneficiary access.
In the next two issues, “From the College” will take a closer look at the four cornerstones of value-based purchasing in Medicare and explore current pilots and demonstration programs, as well as plans for future development in each of these areas. For questions regarding value-based purchasing and how it applies to your practice, contact Itara Barnes at [email protected]
Do You Know the Three Rs of Consultations?
With the Recovery Auditor Contractors (RACs) gearing up to begin auditing physicians’ practices, the ACR is encouraging its members to be prepared.
The RACs will be focusing on high error-rate codes, and it has been reported by the Office of the Inspector General that consultations are high among codes that are incorrectly billed. When looking at consultations, it has been reported that they have been billed in error at least 86% of the time—which does not mean the physician did not provide the service but shows that there was insufficient documentation to support the level of service billed.
When billing for a consultation you must follow the rules of coding for consults, which are known as the Three Rs.
- Request: There must be documentation of the request and a reason for the consultation. A request can be written or verbal, but must be documented in the patient’s record. Keep in mind that the referring physician should be requesting your medical opinion or advice. A consultation is based on the intent of the referring physician and not the specialty of the consulting physician.
- Render: The specialist must render an evaluation and management (E/M) service related to the problem stated in the request.
- Respond: After treating the patient, the consulting physician must submit a written report of the findings of the E/M visit. When coding, do not believe the myth of, “I am a rheumatologist, so all new patient visits are consults.” This way of thinking will not serve you well in the long run. Patient visits are only consults if the referring physician is seeking your medical opinion or advice.
Visit www.rheumatology.org/practice to download the ACR’s documentation tools to help with consultation documentation. If you have any questions about consultations or other coding issues, contact Melesia Tillman, CPC, CRHC, CCP, at (404) 633-3777, ext. 820, or [email protected].
