A Strong Message from Two HIT Leaders on Leadership and Strategy and What Lies Ahead | Mark Hagland | Healthcare Blogs Skip to content Skip to navigation

A Strong Message from Two HIT Leaders on Leadership and Strategy and What Lies Ahead

August 21, 2016
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Suzanne Anderson and Sajid Ahmed speak to leadership and strategic issues at iHT2-Seattle

Two presenters at the Health IT Summit in Seattle last week, coming at the subject from different vantage points, ended up reinforcing the same exceptionally important points about healthcare strategy and leadership in the current operating environment—and those points had nothing to do with the technology per se.

Early on Wednesday, Suzanne Anderson, who on June 1 was named president of the Virginia Mason Health System, a pioneering Seattle patient care organization, talked about some of the lessons she’s learned in her journey as a healthcare executive; and later on in the day, Sajid Ahmed, the chief information and innovation officer at the Martin Luther King Jr. Los Angeles Healthcare Corporation, shared important points from the narrative of the shuttering of the old MLK Medical Center in South Central Los Angeles and the rebirth of the organization as the new MLK Los Angeles Healthcare Corporation, in a brand-new facility and with a new staff.

As I noted in my report last week, Anderson spoke on the topic, “A Leadership Journey: Different Paths to Different Levels.” “There are two different ways people get into senior leadership positions,” Anderson noted. “One is that you take on a variety of positions and eventually are promoted. The other way is, in the IT world, you work your way up in a very technical way, through technical positions. I was CIO before president,” she said. “But am not technical.” Instead, gradually over time, having done implementational IT consulting, she eventually was named CIO at Virginia Mason, and then CFO, and ultimately, several weeks ago, president. As Anderson emphasized, it was her strategic background and experience that led VMHS chairman and CEO Gary Kaplan, M.D. to bring her into the president role in the organization.


Suzanne Anderson speaking at iHT2-Seattle

What Anderson wanted her iHT2 audience to understand was this: “What gets you to a middle management role in the IT world is not what gets you to senior management overall; it’s necessary but not sufficient,” she said. “I have conversations every day with leaders who are no longer middle management, but not quite senior management. And I say, you do a great technical job; a great job getting your teams aligned, and working out budgetary issues, etc. But what I really need for you to do in this case is to think about the organization as a whole… and for you to really understand those more general leadership competencies. Unfortunately in IT, we’re such a technical field that this isn’t necessarily what people have been educated on, or what you’ve worked on in your career, because you’ve been rewarded for layers of technical competence,” she said. Those are the skill sets that are needed now at senior levels of patient care organizations, including among CIOs.

Meanwhile, Sajid Ahmed’s sharing of the story of how the new Martin Luther King Jr. Los Angeles Healthcare Corporation came together, reinforced what Anderson had said, from a different angle. Ahmed, who did evolve professionally through technical IT positions, as well as through executive positions on both the provider and health plan sides of healthcare, focused on the strategic leadership requirements behind the recreation of a once-troubled hospital into a brand-new facility and patient care organization.

Yes, there were numerous technology aspects of the preparation for the opening of the new MLK facility in South Central Los Angeles, Ahmed told his audience. For one thing, he noted, “We went live with Cerner—55 modules simultaneously, and at the same time that we were hiring brand-new physicians and nurses.” What’s more, of the 1,000 employees hired so far, fully 300 were hired in a three-month time period prior to the new facility’s opening.

But when it came down to it, the technological issues involved in moving with alacrity to prepare the opening of the new hospital paled in comparison to the process, strategic, and mission concerns involved, Ahmed told iHT2-Seattle attendees.  Was it difficult to prepare for the opening of the new hospital? Absolutely, Ahmed told his audience. “For six months, I held meetings from 6 AM until 2 in the morning. Everyone was on a different page at first. And what came out of all this was that if we didn’t do this together, we’re all going down together. And I put it out there,” he said; “I told people, you’re going to be at the top of the LA Times story.”

The reality, Ahmed told the audience, is that innovation can only emerge out of a particular kind of culture. “I’m a big fan of innovation,” he told his audience. “But I wanted to use that as a drive to create a culture of innovation. And part of it is not just creating new things and devices, but how to leverage processes, and improve things, especially culture.”  And, he added, “Trust and communication are the hardest things to do, the hardest things to build among people. Do everything you can to maintain them; that’s been part of our success. It’s not the technology’s ability to work, but the people’s ability to work the technology,” he emphasized. “Really,” he said, “it isn’t about the technology. I’m a technologist, I love technology; I launch technology initiatives. But if the doctors, nurses, and others, don’t like it, it’s not going to work.”


Sajid Ahmed speaking at iHT2-Seattle

All of this speaks so strongly to the moment that our industry is in right now, as policy, particularly federal policy, is driving everything forward. From the recent announcements of the new mandatory cardiac care bundle in 98 markets, to the looming implementation of the new MACRA/MIPS final rule, to the announcement of the readmissions penalties, to the eventual resolution of the issues around the remaining elements of Stage 2 meaningful use requirements and the anticipated Stage 3 of MU, and beyond, policy, especially reimbursement-related policy, is pushing the entire U.S. healthcare system forward.

And in that kind of environment, CIOs and other senior healthcare IT leaders with only technical backgrounds and skills, are finding it to be hard sledding. That is not to say that technical skills should be seen as lacking in value; on the contrary, they remain extremely important, as the purchasing decisions alone, when it comes to the big clinical and other information systems that hospitals, medical groups, and health systems are buying, are more and more expensive and comprehensive. And it will be very important, of course, to have enough of a technical understanding of the current data security threats to ensure that numerous IT security elements are put into place.

But the leadership and strategic skill sets needed from CIOs in the next few years will honestly be preeminent, as patient care organizations will need to move into hyper-drive in order to move forward successfully into the emerging policy and operating environment. And no amount of technical skill will compensate for a lack of leadership ability and strategic acumen, which will be so terribly needed in the coming months and few years, as U.S. healthcare revolutionizes itself.

So it was really good to hear from Suzanne Anderson and Sajid Ahmed last week, and to get the really big-picture overview on these issues. And we will need more reminders like theirs going into the future, as the foundations are laid for the next phase of the evolution of the U.S. healthcare system, across what inevitably will be a challenging period of transition.

 

 

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Healthcare Industry Could Save $12.4B With Full Adoption of Electronic Transactions

January 17, 2019
by Heather Landi, Associate Editor
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The healthcare industry continues to make progress automating business processes, but significant gaps remain, representing an opportunity for $12.4 billion in savings through further automation, according to new data from the 2018 CAQH Index.

Electronic adoption and transaction volume increased in 2018, with several common transactions reaching 80 percent electronic adoption across the sector, according to the latest CAQH Index. This progress resulted in a narrowing of the cost savings opportunity for the first time in CAQH Index history.

CAQH is a Washington, D.C.-based non-profit alliance of health plans and trade associations. The findings from the 2018 CAQH Index are based on voluntary nationwide surveys of providers, as well as commercial medical and dental health plans. Participating medical health plans represent over 160 million covered lives—nearly 49 percent of the commercially insured U.S. population—and 7.8 billion transactions conducted in 2018.

The sixth annual CAQH Index is an annual report tracking the adoption of HIPAA-mandated and other electronic administrative transactions between healthcare providers and health plans in the medical and dental industries. These transactions include verifying a patient’s insurance coverage, obtaining authorization for care, submitting a claim and supplemental medical information and sending and receiving payments. The CAQH Index also estimates the annual volume of these transactions, their cost and the time needed to complete them.

By benchmarking progress, industry and government can more easily identify barriers that may be preventing stakeholders from realizing the full benefit of electronic administrative transactions. These insights can prompt new initiatives to address and reduce barriers. For the report, data was submitted by medical and dental plans that cover roughly half of the insured population in the United States and providers representing a range of specialties.

After reporting modest progress over the past few years, the 2018 CAQH Index findings suggest more positive change is occurring in the industry overall. Healthcare industry stakeholders made progress on many fronts this year—in adoption of electronic transactions, reductions in the volume of manual transactions and reductions in the remaining savings opportunity.

“The results highlighted in the 2018 Index are encouraging,” Kristine Burnaska, director of research and measurement at CAQH, said in a statement. “Both providers and health plans are saving time and reducing administrative costs, but more effort is needed to significantly reduce the volume of expensive, time consuming manual processing.”

While the overall volume of transactions in the medical industry increased by 18 percent in the past year, the volume of manual transactions declined, falling 6 percent for health plans and 1 percent for providers, according to the CAQH Index.

Medical industry adoption of electronic eligibility and benefit verification increased six percentage points to 85 percent in 2018; adoption of electronic coordination of benefits rose to 80 percent in 2018, up from 75 percent in 2017. Adoption of electronic claim submission stands at 96 percent and 71 percent of healthcare organizations have adopted electronic claim status inquiries.

However, the healthcare industry made little progress in the adoption of other electronic administrative transactions—only 12 percent of organizations have adopted electronic prior authorization, although that is up from 8 percent the year before. Adoption of electronic claim payment stands at 63 percent and less than half of healthcare organizations (48 percent) have adopted electronic remittance advice processes.

However, continued efforts are needed to significantly reduce the volume of expensive, time-consuming manual transactions and adapt to the changing administrative needs of the healthcare system, according to the CAQH Index. The Index estimates that the medical and dental industries could save an additional $12.4 billion annually with full adoption of electronic administrative transactions, particularly through greater automation by providers, which could save an additional $8.5 billion.

During a period of rising transaction volume, the medical industry shaved $1.3 billion from its savings opportunity, bringing it to $9.8 billion.

The Index also highlights a substantial rise in overall transaction volume, growing in parallel with industry complexity. As these trends persist, the Index finds that the industry would benefit from updated standards, operating rules, infrastructure and functionality that can accommodate the increase in volume and growing complexity associated with the need to connect administrative and clinical data elements in value-based payment models.

“The industry is making progress,” April Todd, senior vice president, CORE and Explorations at CAQH, said in a statement. “But, we are at an inflection point where processes and technology must adapt to a healthcare system that is transitioning to value-based payment and becoming increasingly complex.”

The CAQH Index notes that industry complexity is growing in parallel with transaction volume. “As these trends persist, the industry will benefit from standards, operating rules, infrastructure and functionality that can accommodate both the increase in volume and the growing complexity associated with varying plan and payment models designed to increase the value and quality of healthcare for consumers. There is a need for all stakeholders to support initiatives that lay the groundwork for the future,” the report authors wrote.

The CAQH Index also issued a number calls to action for the healthcare industry, including focusing efforts to address cost savings opportunities. Several transactions offer the greatest potential for savings and should be the subject of attention—transactions include eligibility and benefit verification, claim status, remittance advice and prior authorization. The medical industry could save an additional $4 billion on eligibility and benefit verifications and $2.6 billion on claim status transactions by fully adopting electronic transactions, according to the CAQH Index.

CAQH also recommends accelerating standards and operating rule development and encouraging timely vendor adoption of standards and operating rules.

 

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Has CMS Just Tipped the Scales Towards Provider Alienation, in its ACO Final Rule?

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CMS’s release of its final rule on MSSP ACO participation has pushed the healthcare industry into a very fraught moment in the ongoing evolution of the ACO experiment

As Healthcare Informatics Associate Editor Heather Landi reported on Dec. 21, that morning, “The Centers for Medicare & Medicaid Services (CMS) on Friday morning published a final rule that makes sweeping changes to the Medicare Shared Savings (MSSP) Accountable Care Organization (ACO) program, with the goal to push Medicare ACOs more quickly into two-sided risk models.”

Indeed, as Landi noted in her report, “Referred to as ‘Pathways to Success,’ the Trump Administration’s overhaul of Medicare’s ACO program will redesign the program’s participation options by removing the traditional three tracks in the MSSP model and replacing them with two tracks that eligible ACOs would enter into for an agreement period of no less than five years: the BASIC track, which would allow eligible ACOs to begin under a one-sided model and incrementally phase in higher levels of risk; and the ENHANCED track, which is based on the program’s existing Track 3, providing additional tools and flexibility for ACOs that take on the highest level of risk and potential rewards. At the highest level, BASIC ACOs would qualify as an Advanced Alternative Payment Model (APM) under the Quality Payment Program.”

And, Landi noted, “Currently, the MSSP model includes three tracks and is structured to allow ACOs to gain experience with the program before transitioning to performance-based risk. The vast majority of Shared Savings Program ACOs have chosen to enter and maximize the allowed time under Track 1, which is an ‘upside-only’ risk model. MSSP Tracks 2 and 3 involve downside risk, but participation in these tracks has been limited thus far.”

One of the biggest points of contention in recent months as centered on how aggressive a push on the part of CMS to compel providers forward into two-sided risk would be desirable, or even wise. Some in the industry tried to put a positive spin on the “low-income” element of the program, with that term referring to smaller physician groups choosing to participate in the MSSP. On Friday morning, in response to the final rule, Travis Broome, vice president of policy at Aledade, a Bethesda, Md.-based company focused on physician-led ACO development, tweeted, “One more change to Basic. Low-revenue ACOs will be able to stay in 1-sided risk for 3 years. Difference [between] 2 & 3 years is big. The decision to take risk is made summer before the year starts. So 2 years of 1-sided risk meant making the risk decision before year 1 results even came in.”

But in a statement from the National Association of ACOs (NAACOS), an association comprised of more than 360 ACOs, Clif Gaus, Sc.D., NAACOS’s president and CEO expressed concern that CMS retained the two-year limit for other ACOs. “Becoming a well-functioning ACO takes time and requires building of IT infrastructure, hiring care coordinators, changing the culture of providers, among other tasks. Under CMS’s proposed rule, many ACOs would have just a single year of performance data available to them before evaluating the required move to risk in their third year of the program,” Gaus stated.

Gaus did include a conciliatory note in his statement, saying that "We appreciate CMS' effort in the final rule to provide greater stability to the Medicare Shared Savings Program with five-year agreement periods and more flexibility through waivers for telehealth and skilled nursing facility stays. We look forward to working with CMS to ensure that the Medicare Shared Savings Program, which has a track record of saving taxpayer hundreds of millions of dollars while demonstrably improving care for patients, continues to attract new participants and reap savings." NAACOS has been among the most vocal of healthcare professional associations this year, as CMS Administrator Seema Verma has intensified her call for providers to move forward quickly into more advanced forms of alternative payment models.

But, choosing not to sound any notes of conciliation on Friday, was the Chicago-based American Hospital Association, the largest U.S. hospital association, representing nearly 5,000 hospitals nationwide. A statement attributed to Tom Nickels, AHA vice president, on Dec. 21, said, “Today’s final rule will not be helpful in the move toward value-based care. None of the actions taken today will better empower ACOs to maximize their contribution to patient care and are not pathways for improving the value of the program for patients. We remain opposed to CMS drastically shortening the length of time in which ACOs can participate in an upside-only model. Hospitals and health systems have asked for a more gradual pathway because building a successful ACO that is able to take on financial risk requires significant investments in time, effort and finances.”

Further, the AHA statement said, “While CMS made some improvements to its shared savings rate policies from the proposed rule, they still are not sufficient to appropriately reward ACOs for improving quality and reducing costs. We are particularly concerned about the impact of these and other policies on high-revenue ACOs. We do appreciate that CMS took certain steps to expand participants’ ability to provide care to beneficiaries – for example, via telehealth and longer agreement periods.”

And, the AHA said, “As a whole, the policies in the rule will likely result in a significant decrease in program participation. That would be unfortunate, as we seek to transform care to better serve our patients and communities.”

While the Centers for Medicare & Medicaid Services (CMS) finalized some improvements to the Medicare Shared Savings Program (MSSP), the Premier healthcare alliance is extremely concerned that these are overshadowed by unrealistic expectations of the speed at which providers can transition to risk-based tracks, the un-level playing field created for hospital-led vs. physician-led ACOs and the imbalance of risk vs. reward.

Meanwhile, leaders at the Charlotte-based Premier Inc. were equally critical. In a statement released on Friday, Blair Childs, Premier’s senior vice president of public affairs said that while “Premier appreciates that CMS finalized the extension of waivers and the longer agreement period and heard our concerns about the reduction in shared savings,” “We are extremely disappointed, however, that CMS has moved forward in creating an unlevel playing field that disadvantages high-revenue ACOs—primarily hospital-led ACOs. Premier and other stakeholders, including MedPAC, oppose this policy,” the statement read. “Hospital-led ACOs in Premier’s Population Health Management Collaborative performed twice as well as all the other ACOs nationally. CMS should be taking steps to enhance, not limit, the inclusion of all innovative providers that are seeking to move to value-based care. For an Administration that has been outspoken in advocating for market solutions and level playing fields among competitors, it’s an enormous mistake to finalize a policy that pits providers against each other rather than focusing on collaboration, as the model intends.”

So, where does this leave the industry? Quite possibly, at an important inflection point, now that what was a proposed rule is now a final rule. One could argue this situation from a number of standpoints, but the bottom line is simple: in her desire to push providers forward quickly and decisively into two-sided risk—and even with the carrot-like incentives for smaller physician groups that have been added—Administrator Verma is now strongly risking a massive wave of defections from the MSSP.

As NAACOS’ Gaus noted in his statement, “Under CMS's proposed rule, many ACOs would have just a single year of performance data available to them before evaluating the required move to risk in their third year of the program.” Perhaps similarly importantly, he noted, "Although we are pleased that CMS finalized a new, limited exception to its high-low policy, we remain concerned that the high-low revenue ACO distinction could deter providers who want to embark on the path of value-based care and could unintentionally harm physician-led ACOs. We urged CMS in the rulemaking process to provide an equal playing field for all ACOs and will continue to advocate for changes to this policy. A NAACOS analysis of how ACOs would be classified under CMS's proposed definitions found almost 20 percent of physician-led ACOs would be considered high revenue ACOs. Furthermore, federally qualified health centers and rural health clinics would also have a fair proportion of high revenue ACOs.”

So, here we come to a very tricky set of issues. First, the entire point of adding in the “low-income ACO” distinction was to encourage more physician groups to join the MSSP; and that would be very important for the survival and thriving of the program, since the participation of hospital-based organizations has been slow to date, and one key way to encourage participation by all types of patient care organizations would be to be able to boast about rapidly increasing participation. But if, as Gaus has noted, NAACOS’ analysis finds that nearly 20 percent of physician-led ACOs would actually end up being “high-revenue ACOs,” that could indeed complicate CMS’s attempts to quickly gain new participants.

Further, the short period of time between initial participation and having to decide whether to stay in the voluntary program and take on mandated two-sided risk, poses one of the most serious barriers to increased participation; and therein lies the real rub for CMS, because if this final rule ends up causing mass defections in the next two years, the agency’s signature and largest federal ACO program could begin to fall apart, precisely at the time that Administrator Verma, Health and Human Services Secretary Alex Azar, and all their fellow senior federal healthcare policy officials, would be hoping to accelerate the shift from volume to value in U.S. healthcare, and prove that the broad ACO experiment is working.

On the other hand, it’s also true that if CMS allows the forward evolution of the MSSP program to progress too slowly, that could cause members of Congress and their staffs to determine that voluntary programs simply aren’t cutting it, and move towards massive Medicare cuts instead, in an attempt to get better control of overall U.S. healthcare inflation, at a time when all discretionary spending in the federal budget is increasingly becoming politically fraught.

For the time being, there is no simple answer to any of this. It’s as though the levers of power and influence must be used in an exquisitely calibrated way. There seems to be no “Goldilocks pace” of change here that will both maximize new participation, and ongoing participation, in the MSSP program, on the part of wary providers, and yet also fulfill all the demands and desires of senior federal healthcare policy officials. Only time will tell, but this moment feels more fraught than ever, in the ongoing evolution of the ACO experiment. There’s no doubt that 2019 could be a determinative year for MSSP.

 

 

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CMS: 93% of Clinicians Get Positive Payment Adjustments for MIPS Year 1

November 8, 2018
by Rajiv Leventhal, Managing Editor
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Ninety-three percent of MIPS (Merit-based Incentive Payment System)-eligible clinicians received a positive payment adjustment for their performance in 2017, and 95 percent overall avoided a negative payment adjustment, according to a CMS (Centers for Medicare & Medicaid Services) announcement today.

The first year of MIPS under MACRA’s Quality Payment Program (QPP) was dubbed by CMS as a “pick your pace year,” which essentially enabled clinicians to avoid payment penalties as long as they submitted at least the minimum amount of quality data. As such, in its announcement, CMS did admit that the overall performance threshold for MIPS was established at a relatively low level of three points, and the availability of “pick your pace” provided participation flexibility through three reporting options for clinicians: “test”, partial year, or full-year reporting.

CMS said that 93 percent of MIPS-eligible clinicians received a positive payment adjustment for their performance in 2017, and 95 percent overall avoided a negative payment adjustment. CMS specifically calculated that approximately 1.06 million MIPS-eligible clinicians in total will receive a MIPS payment adjustment, either positive, neutral, or negative. The payment adjustments for the 2017 program year get reflected in 2019.

Breaking down the 93 percent of participants that received a positive payment adjustment last year, 71 percent earned a positive payment adjustment and an adjustment for exceptional performance, while 22 percent earned a positive payment adjustment only. Meanwhile, just 5 percent of MIPS-eligible clinicians received a negative payment adjustment, and 2 percent received a neutral adjustment (no increase or decrease).

Of the total population, just over one million MIPS-eligible clinicians reported data as either an individual, as a part of a group, or through an Alternative Payment Model (APM), and received a neutral payment adjustment or better. Additionally, under the Advanced APM track, just more than 99,000 eligible clinicians earned Qualifying APM Participant (QP) status, according to the CMS data.

CMS Administrator Seema Verma noted on the first pick-your-pace year of the QPP, “This measured approach allowed more clinicians to successfully participate, which led to many clinicians exceeding the performance threshold and a wider distribution of positive payment adjustments. We expect that the gradual increases in the performance thresholds in future program years will create an evolving distribution of payment adjustments for high performing clinicians who continue to invest in improving quality and outcomes for beneficiaries.”

For 2018, the second year of the QPP, CMS raised the stakes for those participating clinicians. And in the third year of the program, set to start in January 2019, a final rule was just published with year three requirements. Undoubtedly, as time passes, eligible clinicians will be asked for greater participation at higher levels. At the same time, CMS continues to exempt certain clinicians who don’t meet a low-volume Medicare threshold.

Earlier this year, CMS said that 91 percent of all MIPS-eligible clinicians participated in the first year of the QPP, exceeding the agency’s internal goal.

What’s more, from a scoring perspective in 2017, the overall national mean score for MIPS-eligible clinicians was 74.01 points, and the national median was 88.97 points, on a 0 to 100 scale. Further breaking down the mean and median:

  • Clinicians participating in MIPS as individuals or groups (and not through an APM) received a mean score of 65.71 points and a median score of 83.04 points
  • Clinicians participating in MIPS through an APM received a mean score of 87.64 points and a median score of 91.67 points

Additionally, clinicians in small and rural practices who were not in APMs and who chose to participate in MIPS also performed well, CMS noted. On average, MIPS eligible clinicians in rural practices earned a mean score of 63.08 points, while clinicians in small practices received a mean score of 43.46 points.

Said Verma, “While we understand that challenges remain for clinicians in small practices, these results suggest that these clinicians and those in rural practices can successfully participate in the program. With these mean scores, clinicians in small and rural practices would still receive a neutral or positive payment adjustment for the 2017, 2018, and 2019 performance years due to the relatively modest performance thresholds that we have established. We will also continue to directly support these clinicians now and in future years of the program.”

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