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News & Press: Industry News

Healthcare Reform Roundtable: How to Plan for a Successful Future in an Uncertain Present

Monday, August 21, 2017   (0 Comments)
Posted by: AAOE
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Healthcare’s constantly changing landscape makes it essential for practice administrators to stay in-the-know about what’s happening in the industry. The healthcare reform debate is just one recent example of the unpredictability that administrators must deal with as they manage their practice. How do you effectively plan for your practice’s future in such an uncertain climate?

AAOE members recently participated in a roundtable discussion to talk about the state of healthcare reform and explain strategies that they are utilizing in their own practices to handle the current challenges in the industry.

 

 

 

 

 

 

Alejandro Badia, MD, FACS
Founder, CEO, and CMO of the Badia Hand to Shoulder Center
Co-founder, CEO, and CMO of OrthoNOW

Joel James
Director of Public and Government Affairs
Signature Medical Group
St. Louis, Missouri

Joseph Mathews, PT, DPT, CSCS
Practice Administrator
Advanced Orthopaedics & Sports Medicine
Houston, Texas

Pamela Pawlick, CMPE
Director of Operations
Alpha Orthopedics & Sports Medicine
McKinney, Texas

Karen Simonton, CPA
Chief Administrative Officer
OrthoVirginia
Lynchburg, Virginia

 

Background

Since the passage of the Patient Protection and Affordable Care Act (ACA) in 2010, more Americans have had access to insurance coverage. Thanks to two provisions of the law, the federal government subsidizes the purchase of health insurance through advance premium tax credits [APTC] (subsidies for insurance coverage of individuals with incomes between 100 and 400 percent of the federal poverty threshold) and through cost-sharing reduction [CSR] subsidies (for individuals with incomes between 100 and 250 percent of the federal poverty level). Following a ruling by the District Court of Appeals for the District of Columbia in House of Representatives v. Burwell invalidating the use of CSRs to provide additional subsidization of insurance for poorer Americans, access to this coverage has been thrown into doubt. The Court’s ruling has led to dramatic premium increases for the 2017 and 2018 coverage years and uncertainty about the fate of the subsidies has caused several insurers to pull out of the individual market for 2018.

In response to present issues facing the current law, Congress has embarked on an attempt to repeal the ACA and replace it. Attempts at repeal have so far failed after the non-partisan Congressional Budget Office (CBO) scored the legislation unfavorably and indicated that millions of Americans would lose access to their health insurance coverage.

The uncertainty about the fate of a law that has proven to be more difficult to repeal than Republicans likely realized holds tremendous peril for orthopaedic practices.

 

What worries you the most about healthcare reform efforts?

Badia: What worries me the most about healthcare reform is simply that the folks in the trenches who actually understand healthcare delivery are not being considered or consulted in making these major decisions that will not only affect patient care and our society, which is incredibly important of course, but will also cause a huge economic downstream result based upon poor decision making.[1]

Mathews: The issue is insurance premiums going up. Nothing is helping the orthopaedic groups or the medical side in general.

Pawlick: I agree with that. I'm in Texas, and in this particular state, in the last two years, all of the insurers have pulled out of the marketplace. So the only people who are left are some very small insurance companies that absolutely nobody will take.

 

How do rising insurance premiums and higher deductibles affect your practice?

Mathews: In a six month analysis of my practice, self pay jumped from 2.9% or so to 10%. 

James: I think another implication of all of this – the rising premiums, the high deductible plan, the self pay –is the continuing inability of people, while they may have some level of access, they just can't afford the care. We're beginning to see more and more acute types of conditions develop into chronic conditions because people are putting off care. That has a consequence long term, not only for additional costs to the healthcare system, but it has implications for how much more difficult it is to treat more complex and more chronic conditions especially when you could’ve had a better opportunity to manage that and keep it under control and have a better outcome and higher quality rating, if you will, than managing a more and more complex, more difficult unmanaged condition.

Pawlick: I agree, and I imagine the hospitals are going to have to start feeling that economic impact from more acute, sick patients at some point. 

 

What strategies have you implemented within your practice to address high insurance premiums and deductibles?

Simonton: We are planning in accord with what is actively out there now, which is effectively self pay. These are insured self pay patients (high deductible plans). Part of our process is to automate as much on the front end and to collect as much money as we can when people walk through the door and to actively manage our claims so we're not catching the deductibles. We are very strategic about all of that in a way that we were never strategic before. We have financial counselors that meet with patients at the very beginning of the process.

Mathews: Collecting money up front is the only way to go. We've found that 61% of money that goes on a payment plan never comes back to us. 

 

AAOE’s 2015 Benchmarking report indicates that 52.6% of net collections in orthopaedics come from commercial insurers. If commercial insurance coverage drops, what can practices do to prepare?

Simonton: I think we continue to figure out ways to leverage collaborative relationships in the communities where we live. When I first heard about service line and co-management agreements, I said, “That is where we need to go,” particularly in a community where the hospital is a not-for-profit. We all need to figure out ways to be remunerated when we are improving workflows, processes and costs for our community partners. 

 

What can practice administrators do during this time of uncertainty in healthcare reform?

James: I think it's important that administrators keep in mind that it's not all doom and gloom. Part of it is up to us to be on the Hill next month [during AAOE Capitol Hill Day] advocating for this stuff and saying how important it is if they want physician practices to survive if everything goes to being in a very expensive hospital setting.

Badia: Administrators need to get out there in the community. I believe the best way is education – education through local media or somewhat paid advertising such as an infomercial. Then the public will know where they need to go when they have an issue. Another way is to get involved in a local chamber of commerce and other business organizations where meeting one person effectively gives exposure to many people because those are representatives from different companies.

I would challenge folks to utilize technology, digital marketing, et cetera to get themselves out there. Orthopaedic surgeons have this unique skillset. But that doesn’t do a modestly educated patient any good if they don’t get to the person with the most information. Administrators need to reach out to them rather than waiting for them to come to us.

 

Next steps? Use these helpful AAOE Resources:

  • Check out this blog post for more information on policy options if cost-sharing reduction payments stop.
  • Connect with your peers on Collaborate and continue this important discussion.


[1] It should be noted that special interest groups, including AAOE, have been kept out of discussions on drafts of legislation to repeal the ACA. This has led many groups like the AMA, AHA, and AHIP to issue scathing indictments of the repeal legislation.


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