What physician practices can expect in 2018 and beyond
In this time of great change, there is a lot of uncertainty about what “the new normal” will be for physician practices in the next couple of years. To help address some of the ambiguity ahead, a recent webinar features my conversation with Jeff Goldsmith, President of Health Futures, Inc, National Advisor to Navigant, and Associate Professor of Public Health at University of Virginia.
Jeff shared great insights, including these highlights about what physician practices can expect to see in the future:
1. Policy will shift attention away from hospitals, toward physician practices. Jeff summarized the Obama policy cycle as one characterized by a significant expansion in health insurance coverage and increase in the complexity of payments.
“The new administration is much less beholden to the hospital industry,” he said. “[It] is likely to tilt the policy playing field back toward independent docs.”
One of the ways that might happen is through administrative simplification, to ease billing and documentation requirements. But Jeff acknowledged that uncertainty remains as the new administration “does not yet have a cohesive healthcare policy.”
2. Patients will bear more of the financial burden for their care. At the same time policy regarding healthcare providers is changing, the financial model is also shifting more responsibility to patients.
“That increase in patient economic responsibility, the growing number of people in high-deductible plans, is putting tremendous pressure on every healthcare provider,” Jeff said. “It is not only raising financial barriers to access to care, but also making it harder to collect the bills people incur.”
3. Some payers remain reluctant to adopt risk-based models, but they will still cut costs. Outside of the West Coast, Jeff said that some insurers are moving slowly to share risk or shift risk to providers. Because the identification of desired outcomes is still taking shape, the transition away from “fee-for-value” is translating into “fee-for-check-the-box” for now, which is a model that provides fewer pathways for providers to manage risk than they have under capitation.
“As Medicare and Medicaid patients become more and more of the total health plan enrollment, and those rates are not keeping pace with inflation, the only real leverage health insurers have to reduce their expenses is to cut the unit payment.”
4. After automating, practices will focus on using more capabilities to increase patient-facing time. Following HITECH and Meaningful Use, providers were singularly focused on implementing electronic health records (EHRs), but usability and maximizing use of these systems was put on the back burner. He’s optimistic that over the next couple of years, practices will find ways to use EHRs to “add patient-facing time back” to their day.
“We’re using about 20 to 30%, at most, of the capabilities of these complex tools,” Jeff said. “If we want to make progress, it is going to require an investment.” It will take time to learn and take full advantage of what the tools can do.
5. Existing patients will be the foundation for practice growth. Jeff acknowledged that it is easy for providers to be distracted by social media and the many ways patients rate physicians and their clinical experience. However, these channels will not be the engine for growth, but instead will be from personal referrals and word-of-mouth advertising.
“You look at all the data on where new patients come from, and it’s from that conversation over the back fence or in the workplace,” Jeff said. “It’s counterintuitive, but one of the most effective means of growth is retaining and pleasing the patients you already have.”
6. Physician practices will play a central role in managing entire episodes of care. Drawing from his personal experiences, Jeff recognizes that a huge burden has been shifted onto the patient and family to guide recovery after acute interventions.
“[Physicians] taking charge of that uncertain period, the transitions of care, the movement into post-acute stage,” he said. “It is going to be increasingly important in generating the referrals that people are going to need to rely on to grow their practice.”
7. Consider different ways to achieve scale to contract with larger payers. Jeff doesn’t believe physicians are merging to achieve economies of scale, but rather “achieving scale across multiple markets is the key to getting the attention of [large commercial payers] that are willing to contract with you.”
He cautions that it doesn’t necessarily mean practices should merge, and that there are many examples of other types of collaborations. He suggested that healthcare should build on the strengths found in the independent practice – namely, “more direct contact with the patient relationship” – to achieve affordable care.
In the full webinar, we discuss in greater detail healthcare’s current environment, keys to growing intelligently and how to thrive in the new normal. To learn more, listen here.