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Productivity vs Quality

by Barry Bittman, MD

Many independent and employed physicians see themselves trapped between two opposing forces that impact their practices: productivity and quality

Productivity, as measured in our present fee for service model, is often documented in terms of Relative Value Units (RVUs), benchmarked in accordance with annually-updated data compiled by the Medical Group Management Association (MGMA).  Volume-based incentive payment systems often rely on MGMA data and other factors to establish total compensation packages. 

Quality however has been more difficult to define.  Essentially it reflects how well hospitals and physicians are taking care of their patients.  Quality is typically referred to in terms of core measures or specific aspects of “best practices” that can be quantified.  In a perfect system, productivity should exist in harmony with quality. 

Undoubtedly however this is not a perfect world.  The real dilemma begins as the quest to improve productivity tends to advance at the expense of quality.  The decision to spend additional time with a patient for the purpose of offering a more comprehensive patient-centered approach may boost quality at the expense of productivity.  In contrast, increasing throughput by seeing more patients in a particular time frame yields substantial potential for decreasing quality, widening care gaps and increasing medical errors.

While some healthcare experts would argue that enhancing both productivity and quality simultaneously is possible, at some point this equation becomes constrained.  In fact, increasing productivity beyond a certain point has a tendency to evolve into a futile and dangerous exercise.  The real problem however is not the goal, but rather what I term the in-the-box construct that remains the center of focus for creating a better yesterday.

Consider the following assumption: 

productivity times quality equals a successful healthcare delivery system

As productivity or quality increases, the healthcare delivery system improves.  Conversely, as either diminishes, healthcare delivery suffers.

As a result, many physician office practices employ extenders (nurse practitioners and physician’s assistants) who also theoretically serve to boost quality as physicians can now devote more time to certain patients with more intense or critical needs.  Yet in a real world environment, the outcome measure ultimately tied to the success of the extender is volume.

That takes us back to our in-the-box construct.  Simply stated, perhaps our underlying assumption is incorrect.  While this may seem rhetorical at first, a closer look at what we assume to be a successful healthcare delivery system reveals a host of revealing questions and insights.

Perhaps the best place to begin is redefining this construct as:

a sustainable cost-effective strategy that optimizes patient outcomes and care experiences
equals a successful healthcare delivery system

While you may be anticipating that I’m about to suggest surprise layoffs and charging overworked staff for coffee in the lunch room, such is not the case. Cost-effective does not refer to slicing and dicing physician reimbursement with the dull end of a discarded scalpel either.

Rather, the concept targets more effective healthcare spending.  The good news is that in order to develop a sustainable cost-effective strategy, we have to learn to work smarter rather than harder… and we must begin working together in a collaborative manner.

“Why should that be considered good news?” you may be asking.

The answer introduces two out-of-the-box strategies: 1) improving quality through enhanced care coordination and 2) reimbursing physicians for achieving or exceeding benchmarks that reflect positive patient outcomes!

While this approach might appear bold at first, these processes are evolving far more quickly than anticipated as evidenced by two recent CMS announcements. 

Frankly this shouldn’t be surprising. As a nation, we’re out of funds and well into deficit spending.  The survival of our disjointed American healthcare system clearly depends upon focusing on outcomes rather than volumes. 

CMS recently proposed a reduction in the physician fee schedule beginning in 2015.  Parallel to the Value-Based Purchasing guidelines set forth for hospitals, fees will be reduced for physicians who do not satisfactorily follow quality guidelines.  The program is structured to begin with a 1.5% fee reduction that will extend to 2% in 2016 and subsequent years. 

In addition to this novel fee restructuring strategy, a new HHS program announced recently entitled the Comprehensive Primary Care (CPC) initiative, has substantial potential for positively impacting patient care.  According to the CMS Innovation Center, the CPC initiative will focus on risk-stratified care management; access and continuity; planned care for chronic conditions and preventative care; patient and caregiver engagement; and coordination of care across the medical neighborhood. This shared savings strategy will include a per beneficiary per month care management fee in addition to fee for service reimbursement for selected primary care practices.  Essentially, this initiative rewards medical practices for enhancing care coordination in concert with Triple Aim objectives— better outcomes, better care experiences and lower per capita cost.

According to CMS, “Practices will have discretion to use this enhanced, non-visit-based compensation to support non-billable practitioner time, augment care teams (e.g. care managers, social workers, health educators, pharmacists, nutritionists and behavioralists) through direct hiring or community health teams, and/or invest in technology or data analysts.

Ultimately, business as usual will no longer be the same. In the future physicians will not get paid for the amount of care they provide, but rather for the quality–based outcomes they achieve. In contrast with prior initiatives that unfortunately tended to limit patient care and services to achieve cost-effectiveness, this new era of healthcare ushers in a novel approach for achieving affordable care in concert with improved outcomes and care experiences.

While the future of American healthcare clearly rests on building a sustainable cost-effective strategy that optimizes patient outcomes through exemplary care coordination, the buck doesn’t stop here.  We must work together to develop a rational strategy that effectively engages patients in taking an active and meaningful role in their own health and well-being through evidence-based prevention strategies.


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