Why Cardiovascular Medicine is so Special: And why governance & leadership need to connect the dots

Thursday, December 20, 2018 | Joel Sauer


Beginning around 2008 cardiologists and CV surgeons began migrating from private practices into hospital employment models. Today more than 80 percent of CV doctors are in some form of integrated model with a hospital or health system (see figure 1). While hospitals had begun employing primary care in the early 1990s, specialists like cardiologists were a different acquisition and many migrated from organized groups with sophisticated infrastructures, a host of imaging services and in some cases procedure labs.


These traits made CV physicians unique from other currently employed doctors, yet the conventional wisdom then and still today – now a full 10 years later – is to put them within the same legal enterprise as all other employed physicians. While this location alone is not problematic, trying to manage CV physicians within a single model certainly is challenging and inevitably leads to bad business decisions.

What makes cardiovascular so special?
For starters, cardiac disease is the number one killer in the United States and around the world. Some recent studies have shown that cancer has overtaken this top spot, but regardless heart disease is right up there in lethality. According to American Heart Association data the prevalence of CV disease is projected upward for the next two decades. This is important as the nation tries to put more emphasis on value and in particular population health.

Related to being the top killer, CV disease costs the United States a lot of money and is solidly the undisputed top disease expense in the country – with costs expected to soar in the future. According to the Center for Disease Control (CDC) the current CV direct cost burden is north of $555 billion with projections to top $1 trillion in the next 20 years. This means that one out of every six total healthcare dollars is spent on CV care. When considering indirect costs, like lost productivity, the current costs exceed $1 billion per day!

All this demand and cost translates into revenue for providers and hospitals, which in turn drive the bottom line. For hospitals with a full complement of CV services the financial impact can range from 20 – 60 percent of the total operating margin. This margin provides needed funding for other critical services within a health system.

In a high percentage of cardiology groups, particularly those not in a densely populated urban center, the physicians travel to outreach clinics through their primary and secondary service areas. These clinics act as a funnel to steer patients into the system and provide volumes to a host of other medical specialties beyond cardiology. Consider the patient who enters through cardiology and requires an intervention or open-heart procedure. For appropriate care pulmonary/critical care, hospitalists, radiology, pathology, endocrinology, nephrology, infectious disease, neurology and others may join in the care.

In a value driven healthcare economy, quality is king. To measure quality an organization must have trustworthy data. Here again the CV community separates itself having over the past 30-plus years developed a host of registries and other scientifically based quality measures. Just a partial list is inventoried in Figure 2. Beyond measuring quality, the CV societies have developed detailed appropriate use criteria (AUC), guiding providers on when and when not to perform tests, procedures and the like. In many cases the AUC have resulted in a reduction in volumes which in a fee-for-service economy hurt revenue (see Figure 3 on nuclear testing trends). Despite this financial punishment, these AUC were adopted - even before Medicare and other third parties instituted any reimbursement consequences.



From an operational standpoint, the most important distinctions between CV providers and other medical specialties are CV’s deep sub-specialization and broad provider deployment requirements. Within cardiology there are currently five major subspecialty categories: Advanced Heart Failure, Electrophysiology, General/Non-Invasive, Interventional and Invasive/Non-Interventional. Medicare currently recognizes only four cardiology specialties (cardiology, EP, heart failure and interventional), but from an operational and management standpoint this list falls short of the true complexity. For instance, many groups have cardiologists focused on advanced imaging with dedicated interpretation time. Now with the advent of a growing list of structural heart procedures, programs are seeing interventional physicians work nearly exclusively in this area. On top of these cardiology concentrations we add CV and thoracic surgery.

In addition to being subspecialized, CV physicians live almost equally in all three major health system care settings: the hospital (inpatient), office and ambulatory facilities, and procedure rooms. For some groups, coverage even expands into skilled nursing and rehabilitation facilities. While many groups attempt to limit the daily transitions of a single provider between these care settings, even under the most efficient provider deployment schemes this breadth of coverage is complicated to manage.

Governing from the Patient Perspective
Perhaps more than any other medical specialty, cardiovascular care is a team sport. If this team isn’t managed holistically and patient handoffs and transition intentionally managed, patient care will suffer. Additionally, this team operates in nearly every care setting – from the hospital bed, to the operating room, to the office and beyond.

This complexity requires a leadership system that oversees the entire continuum of care, managing the process as the patient experiences it, not from the artificial separation of different tax identification numbers. Without this holistic oversight, good and logical decisions in one setting can have negative consequences in another. For instance, health system physician employment entities tend to lose money on direct operations, given that many of the lucrative tests and procedures are accounted for on the hospital’s ledger as opposed to the physician group’s profit and loss statement. This is particularly true with CV practices.

In an attempt to manage this negative bottom line, well-intentioned restrictions on recruitment and/or support staff reductions may be instituted. The result can be choked access and a drop in new patient volumes which ultimately leads to declines in market share. Further, without adequate support resources, patients that might otherwise be handled by a phone call or immediate office visit will need to be shunted to the emergency room. Once in the ER there is a high likelihood of admission, even if the problem could have been handled in a much lower cost and acuity care setting. In a value economy this outcome will be financially penalized, but more importantly the care was substandard for the patient.

While these scenarios seem far-fetched for such a sophisticated industry, they happen every single day and, unfortunately, are more the rule than the exception. While standardization can have tremendous value in care settings, helping to ferret out bad variation that can lead to inferior outcomes and higher costs, it doesn’t translate to physician governance. The truth is, cardiovascular medicine is different, and this uniqueness requires a tailored governance structure, one that matches the complexity of the clinical sub-specialization and manages holistically the various patient care settings.

To ignore these truths or simply wish they didn’t exist will lead to bad decisions and ultimately lower the value of the care we provide. With innovative and well-funded companies like Amazon, Apple, Berkshire Hathaway, Google, Optum and Walmart (just to name a few) now focused on healthcare, it’s imperative we get this right. Oh, and let’s not forget the patient. Yeah her!

Figure 4


Illustration: Lee Sauer

About the Author
Joel Sauer

Joel Sauer, MBA, is Executive Vice President of MedAxiom Consulting. Joel consults around the country in the area of value-oriented physician/hospital partnerships preparing health organizations for the value economy. His work includes vision and strategy setting, creating and implementing effective governance and leadership structures, co-management development, joint venture and other innovative partnerships, and provider compensation plan design. Beyond the above, Joel has a wealth of experience in service line development, clinical strategy development, provider workforce planning; including care team creation and physician slow-down policies, MACRA and bundled payment planning, and operational assessments.

To contact, email: jsauer@medaxiom.com

Leave a Comment

« Back