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Cedars-Sinai’s Weingarten: Massive Payment Change Puts Spotlight on CDS

November 12, 2016
by Mark Hagland
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Cedars-Sinai’s Scott Weingarten, M.D., shared his perspectives on MD success in the new payment environment

What does the near-term future of healthcare look like to physicians in practice? Scott Weingarten, M.D., the chief clinical transformation officer at Cedars-Sinai Health System in Los Angeles, shared with attendees at the Health IT Summit in Beverly Hills, sponsored by Healthcare Informatics, his perspectives, on Nov. 10. He and his fellow healthcare leaders were gathered together at the Sofitel Los Angeles at Beverly Hills for the conference.

Dr. Weingarten, who has spent decades in medical practice, in consulting, on the vendor side of healthcare, and more recently, in health system administration, sees a complex road map ahead for practicing physicians in the U.S., one informed by accelerating policy and payment changes, which are in turn shaping the choices that doctors might make in the next few years.

In his presentation at the Summit, Weingarten focused on some of the major paths forward for U.S. physicians, all of which are being shaped directly or indirectly by federal mandates. He delved into aspects of the new Merit-based Incentive Payment System (MIPS) under the MACRA (Medicare Access and CHIP Reauthorization Act) law passed by the U.S. Congress last year, which goes into effect on January 1, 2017; and also the category of alternative payment models (APMs) under that law. Under MACRA, Medicare-participating physicians will have the choice of either participating in an APM, which can include participation in an accountable care organization (ACO), or participation in the Comprehensive Primary Care Plus Program, or, participating in the MIPS program, with its numerous outcomes-related reporting requirements for payment. Either way, their choices will be governed by federally mandated participation in some program that measures quality or value in physicians’ delivery of patient care and pays differentially according to the results of that care delivery. Weingarten also discussed aspects of the mandatory bundled payment programs for total joint replacement and for cardiac care, programs that senior officials at the Centers for Medicare and Medicaid Services (CMS) have made clear will be expanded beyond the markets in which the bundled payments have already been mandated (98 metro markets for cardiac bundled payments and 69 metro markets for total joint replacement bundled payments).

Scott Weingarten, M.D.

After initially laying out some of the broader landscape, Weingarten delved into physicians’ options in the new policy and payment environment. “MIPS will be less attractive to physicians [than participation in an APM] for many reasons: you don’t get the 5-percent annual bonus, and the payment rate enhancements are lower,” he said. “But for those physicians who are a part of APMs or MIPS, how do they do well in this new, post-MACRA world? I’ve presented a lot of this to physicians at Cedars-Sinai, and many want to know how to get into an APM, or how to succeed in a MIPS world. A small number of physicians say this is really hard, and I’m going to stop caring for Medicare patients. But then I share with them that the commercial insurers are quickly moving to risk-based payment, following Medicare. So fee-for-volume is quickly going away. Virtually all the commercial insurer CEOs and executives have declared what their timing is for shifting to risk-based payment. And so if you don’t want to take Medicare and you don’t want risk-based payment from commercial payers, you’re basically left with cash-paying patients, and there aren’t many of those out there.”

Shifting his discussion to mandated bundled payments, Weingarten said, “The Advisory Board Company has modeled reductions under bundled payments, and the reduction in our payments is three times greater under bundled payments than under MACRA. So the bundled payment mandate is a clever way for Medicare to reduce payments,” he warned his audience. What’s more, he noted, “There are 65 Medicare markets in Southern California, including the Los Angeles market specifically, that are already under the total joint replacement bundled payment mandate. So risk-based payment is coming at you, and coming at you fast. Hopefully, most physicians will succeed, but not everyone will.”

Making the numbers work in academic medical center-based care

All of these policy and payment changes are putting pressure on academic medical centers and teaching hospitals as never before, Weingarten told his audience. At Cedars-Sinai Health, which encompasses two hospitals, a medical group, and an IPA (independent practice association), “We’re doing more heart transplants than any place in the world, 132 a year. But we have a cost structure built for an academic medical center, which makes it hard. Are there any advantages? An article in the New England Journal of Medicine that was published about Partners”—Partners Health Care in Boston—“says, we do have options. Academic medical centers specialize in clinical innovation,” he noted. And, he said, the article went on to say that academic medical centers “must now apply their innovative capabilities not only to clinical care, but also to innovation in operations. This is front and center at Cedars-Sinai,” he stressed. “We’re having our executive retreat tomorrow, and we’re all going offsite to talk about this,” he noted. “So as you begin to move forward, how does technology help your organization with its goals to succeed in a risk-based environment?” In fact, he said, technology, especially and including information technology, will play a key role in helping the leaders of patient care organizations, including of academic medical centers and teaching hospitals, to adjust to the emerging healthcare payment landscape.


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