Two overlooked sources of new revenue, and better quality to boot!

Thursday, January 19, 2017 | Larry Sobal

 

Last week I blogged about where heart programs are leaving millions of dollars on the table. I would be remiss if I didn’t also call your attention to two additional, large financial opportunities. And like some of the five items I focused on last week, these are for specialty practices or service lines and each offers $1 million+ of opportunities. Furthermore, they not only bring in new revenue, but contribute to better patient care. That’s a winning combination in a market moving more toward rewarding value.

The first opportunity, Chronic Care Management (CCM), is not new, but the Centers for Medicare & Medicaid Services (CMS) has implemented some changes for 2017 that make this opportunity much more attractive and feasible. Since 2015, CMS has been providing monthly reimbursement for CMM of patients not conducted during a face-to-face patient visit to help better treat patients with multiple chronic conditions. CMS ultimately aims to reduce preventable readmissions, emergency room visits, nursing home intakes and other utilization costs that often don’t have much of a positive effect on the patient’s long-term health.

The original attraction of CCM was that CMS would pay practices about $42 per month per patient for providing 20 minutes or more of care coordination. This is work they were likely already doing. For a physician with 1,000 Medicare patients in their panel, this would equate to $500,000 per year of additional CMS reimbursement.

Unfortunately, the original design of the CCM program had flaws that prevented most physicians from taking advantage of this reimbursement opportunity. Practices found there was an excessive burden on creating the documentation to support the 20 minutes or more of engagement with the patients and were fearful they would not survive an audit. Plus, patients were required to submit a monthly co-pay of $8 per month, which some people balked at. As a result, CMS reports that only 513,000 patients received CCM services an average of four times, totaling $93 million in total payments since the CCM code 99490 was created.

But things are better in 2017. The 2017 Physician Fee Schedule Final Rule implemented payment policies designed to make it easier and more financially attractive for physician practices to furnish CCM services to Medicare beneficiaries. These include easier enrollment of patients in your CCM program, no longer requiring a face-to-face visit for existing patients, elimination of separate consent forms, additional reimbursements for time increments beyond 20 minutes and expanding reimbursement to $68 upon creation of a patient’s care plan and additional reimbursements for CCM patients of moderate or high complexity.

Failure to have this potent combination in place is often the fastest path to the nearest emergency department . . .

The net result is that physicians have a greater financial opportunity for new revenue with CCM, and the benefits of better care coordination have been well documented. The challenge lies in how to operationalize this way of managing patients. In researching solutions for MedAxiom members, we investigated a variety of third party vendors. We determined that ChronicCareIQ, creator of the first automated CCM solution with an extensive array of app-based technology, offered the easiest and most financially beneficial way for physicians to engage and manage their chronic care patients, and successfully capture the reimbursement. You can learn more about them at https://chroniccareiq.com/.

What does this mean for the practice? MedAxiom recently worked with a group of 16 physicians and 9 APPs, and in analyzing their patient panel of 30,000 Medicare Beneficiaries, 70% have 2 or more chronic conditions and are thus eligible for CMS' CCM program. If only 30% of eligible beneficiaries are enrolled into CCM, the practice would generate over $409,000 a month ($4.9 million annually).

The second financial opportunity focuses on one of the major, but often overlooked, problems in US health care—the severe lack of medication adherence. Research shows that:

• 125,000 Americans die annually due to poor medication adherence
• Nearly 2.8 million annual preventable hospital readmissions result from poor drug therapy, representing costs of approximately $100 billion
• More than 25% of prescriptions are never picked up by the patient and 50% of prescriptions are not taken as directed
• 30-40% of patients fail to continue their medication after their first prescription

Inadequate medication compliance results in poor health outcomes and costly complications that are often more expensive than the medications themselves. This is not only an acute problem with MedAxiom’s member heart programs treating cardiovascular disease, it impacts virtually every subspecialty. As we enter 2017 and are now faced with successfully managing MACRA and preparing for cardiac episode management (bundled payments), there may be no better opportunity to impact the economic costs of health care while improving the quality of patient care than through the improved management of patient medication compliance.

Again, in our efforts to find transformative solutions to our members, we have identified an innovative company, Cambridge Therapeutic Technologies (CTT). CTT uses packaging design to drive higher patient medication compliance through calendarized and color-coded packaging of common prescriptions. Birth control pills, which come in well-organized and easy-to-understand packaging, and have among the highest compliance rates, are an example of where design meets function and function facilitates compliance. 

The benefits to a medical practice are many and include:

• Providing a differentiating practice benefit via point-of-care dispensing
• Generating a new revenue stream as the physician practice receives a portion of each prescription fee – which does not occur when patients are sent to a local pharmacy to fill a script
• Improved patient satisfaction by simplifying the entire prescription process

It is important to note that CTT offers patients a nationwide network of local pharmacies or mail order to facilitate refills, so practices may choose to only dispense the initial prescription. The unique synergies of the CCT model create opportunities to break away from a traditional model of medication management, which has clear deficiencies in terms of patient adherence. You can learn more about CTT at http://www.cambridgett.com.

Aside from the obvious compliance increases, the ability to dispense the initial medication compliance pack brings new revenue to the practice. Groups are implementing this new program beginning in 2017 and to realize the impact of this new revenue opportunity. With MedAxiom assistance, an 18 provider specialty group recently completed an analysis of their prescribing patterns and is in the process of implementing the CTT model; this group is forecasting approximately $45,000/provider of new revenue this year (a total of $810,000). It is also important to note that this increased revenue represents zero increase in cost to the practice or the health care system.

What’s interesting, and very compelling, is that these two opportunities are actually linked; medication adherence is particularly relevant as many CCM patients manage a variety of pills to deal with hypertension, diabetes, high blood pressure, etc. These must be taken in a specific order and at certain points throughout the day. If a patient is confused about his or her medication routine, smartly designed packaging and/or a quick phone call to the CCM professional at the practice is all that is needed to clarify the matter. Failure to have this potent combination in place is often the fastest path to the nearest emergency department – that’s when costs go up and quality goes down.

If you are interested in learning more about either or both of these opportunities, please contact Joe Sasson, Vice President of Strategic Initiatives with MedAxiom; he can provide additional information about how CV programs are operationalizing strategies around these new programs.

 

Illustration: Lee Sauer

---

 

Larry Sobal is Executive Vice President of Business Development at MedAxiom. He has a 35-year background as a senior executive in medical group leadership, hospital leadership and insurance. Larry consults, writes and presents on topics relevant to transforming physician practices and health systems.

---