Toughest challenges in Managed care???

[Guest guest]

What follows is an excerpt from our new book on managed care where we

identify what we see are the biggest challenges for managers in a managed

care world.

Please comment and add what you find to be YOUR biggest challenges.

Thanks

*********************

Managed Care Challenges for Rehabilitation Managers

There are many challenges that will face the rehabilitation manager as

managed care transforms the manner in which we carry out our clinical

responsibilities. In this final section, we will identify and discuss the

top 5 challenges that we have observed rehabilitation managers struggling

with.

The Top Five Managed Care Challenges

1. Handling the schizophrenia of an

environment that is caught between cost and fee based systems and fixed

reimbursement systems.

2. Determining when clinical care is finished.

3.

Disproving the null rehabilitation hypothesis.

4. Handling the shift from

national and regional decision making to local decision making.

5.

Developing systems to identify competence. Becoming intolerant to

incompetence.

Challenge # 1. Handling the schizophrenia of an environment that is caught

between cost and fee based systems and fixed reimbursement systems.

Managed care, as it evolves, typically involves a period of time when there

is a transition from cost reimbursement and fee for service care to

prospective payment and other models of fixed reimbursement. There are many

inherent differences between these. The basic incentives of each system

are, frequently, contradictory. However, during the period of transition to

fixed reimbursement systems, there will be a mix of clinical care that

falls within each of these two systems - cost and fee based reimbursement

and fixed reimbursement.

At times, the manager who is caught in this period

of transition will find it necessary to manage the clinical practice in

ways that may seem contradictory. This is often disconcerting to managers.

It is usually confusing to staff.

Many inherent differences in cost/fee

reimbursement and prospective or fixed reimbursement systems have been

discussed throughout this book. Some of the most critical are listed in the

following table.

Differences in Clinical Management in Emerging Managed Care Markets

Area of Clinical Management Cost and Fee Based Reimbursement Systems

Prospective and Fixed Reimbursement Systems

Profit Focus on increasing

volume to assure profitability Manage expenses to assume

profitability

Clinical Behaviors Focus on treatment effectiveness and

efficiency Focus on case management effectiveness and

efficiency

Relationship with Payers Adversarial - Focus on attempts to

secure more care and services for individual patients Collaborative - Focus

on attempts to develop additional group contracts. Individual patient care

issues less important to payer except as they relate to member satisfaction

and group plan retention rates

Clinical Outcome Satisfaction of key

customers Satisfaction remains important but increasing emphasis on

specific cost and clinical outcomes and effectiveness

Financial Incentives

Do more, charge more Do only what is needed

Note that the items listed in the above table or descriptions of what the

different systems encourage, not what is morally or ethically appropriate.

Challenge #2. Determining when clinical care is finished.

In a cost

reimbursed or fee for service environment, mistakes related to

inappropriately delayed patient discharge carried no real financial penalty

to the provider. This is dramatically different in a fixed reimbursement

environment.

One of the most difficult decisions that a rehabilitation

clinician will need to make is the point of termination of clinical care.

Determining when a patient is " done " becomes very important in managing

costs and presenting a practice profile that demonstrates clinical

efficiency.

The Patient Recovery Continuum, as illustrated in the chart, show a

typical pattern of patient recovery during the process of rehabilitation.

Initially, there is a relatively rapid rate of recovery. Over time, the

recovery slows. Eventually, there is a tapering off of the recovery to a

point we often call a plateau. In many cases the cost to deliver

rehabilitative care is relatively constant throughout the course of

therapy. This creates an early period where the return on investment (cost

of care compared to amount of recovery) is relatively high compared to

later periods of plateau. Although any individual patient's recovery is

likely to differ from this pattern, it will still be necessary to determine

the point at which further therapeutic intervention (in the current venue)

should be terminated. Few decisions have as significant an impact on the

financial well being of the clinic.

As managers and leaders, we will need

to work to help staff determine the appropriate termination point so that

patients receive optimal value from our clinical interventions without

unnecessary financial burden on our practices.

Challenge #3. Disproving the null rehabilitation hypothesis.

Especially in situations where there is capitation of the primary care

physician or fixed reimbursement to a facility, it will be necessary to

demonstrate the financial value (to that physician or facility) of

rehabilitation. Because in PCP capitation and prospective reimbursement to

facilities, the real purchaser of rehabilitation is that PCP or facility,

our ability to influence them to view rehabilitation as a financial

investment will be critical. There are financial incentives in fixed

reimbursement systems to NOT refer to rehabilitation services. This is in

stark contrast to previous cost and fee based reimbursement systems which

had financial incentives inherent in them to refer to rehabilitation

services. We will need to demonstrate that rehabilitation is necessary for

optimal patient recovery. The focus of that demonstration will need to be

the local decision makers - the primary care physicians and the decision

makers internal to facilities who will control the health care dollar. This

leads to Challenge #4.

Challenge #4. Handling the shift from national and regional decision

making to local decision making.

Historically, health policy, including rehabilitation referral guidelines,

was determined at a national or regional level. Patterns of referral to

rehabilitation services were similar to those of patient entry into the

health care system as illustrated in the following chart.

As managed care continues to develop in any given market, there is a shift

in how patients enter the health care system and a shift in health care

decision making to the local managed care organization. The following chart

illustrates entry into the health care system under a managed care model.

It also illustrates the new relationships within the health care system.

In order to succeed in the managed care model of health care delivery,

rehabilitation professionals will need to develop new skills to become more

influential with the decision makers at a local level. We can no longer

assume that policy decisions will be made at a national (Congress or HCFA)

or regional (Multi state commercial insurer) level. Medical practice policy

decisions will increasingly be made by the administrative or medical

officers of the local HMO or other managed care entity. To influence these

individuals, we will need to first identify them and then be able to have

access to them. Lastly, we must be effective in our discussions regarding

the impact of rehabilitation services on the patient and the financial

status of the facility or PCP.

Challenge #5. Developing systems to identify competence. Becoming

intolerant to incompetence.

Because the rehabilitation provider assumes

significant financial risk in many of the managed care models that will

become prevalent in the future, we must be able to identify clinical

techniques and practices that are not effective or that are wasteful. We

will also need to develop mechanisms to identify clinicians who are

ineffective. Quality improvement programs and outcomes management programs

are important in the identification of both practices and clinicians who

are ineffective. We need to become quite intolerant of ineffectiveness and

incompetence. Both of these are serious threats to the rehabilitation

industry.

In an environment that is searching for demonstrated outcomes

and effectiveness, there should be little tolerance of the incompetent

clinician or ineffective clinical practice. There is just too much at stake

to ignore these issues.

R. Kovacek, MSA, PT

KovacekManagementServices, Inc.

The FOCUS Group, Inc.

20225 Danbury Lane

Harper Woods, MI 48225

Fax

Email Pkovacek@...

<http://www.theFOCUSgroup.net>

----

Read this list on the Web at http://www.FindMail.com/list/ptmanager/

To unsubscribe, email to ptmanager-unsubscribe@...

To subscribe, email to ptmanager-subscribe@...

--

Start a FREE E-Mail List at http://makelist.com !

[Guest guest]

A crucial part that seems to be missing is how we handle the stress and

pressure that is added by all these changes. Physical therapists already

seem to have run-ins with burn-out. It may well be that an effective

therapist is the therapist who can effectively handle the stresses of the

profession--thus creating a more therapeutic presence where patients could

heal more efficiently. As managers and leaders we can't overlook the

emotional, physical and mental well-being of ourselves and those working

with us.

Toughest challenges in Managed care???

>What follows is an excerpt from our new book on managed care where we

>identify what we see are the biggest challenges for managers in a managed

>care world.

>Please comment and add what you find to be YOUR biggest challenges.

>Thanks

>*********************

>Managed Care Challenges for Rehabilitation Managers

>There are many challenges that will face the rehabilitation manager as

>managed care transforms the manner in which we carry out our clinical

>responsibilities. In this final section, we will identify and discuss the

>top 5 challenges that we have observed rehabilitation managers struggling

>with.

>The Top Five Managed Care Challenges

>1. Handling the schizophrenia of an

>environment that is caught between cost and fee based systems and fixed

>reimbursement systems.

>2. Determining when clinical care is finished.

>3.

>Disproving the null rehabilitation hypothesis.

>4. Handling the shift from

>national and regional decision making to local decision making.

>5.

>Developing systems to identify competence. Becoming intolerant to

>incompetence.

>

>Challenge # 1. Handling the schizophrenia of an environment that is caught

>between cost and fee based systems and fixed reimbursement systems.

>Managed care, as it evolves, typically involves a period of time when there

>is a transition from cost reimbursement and fee for service care to

>prospective payment and other models of fixed reimbursement. There are many

>inherent differences between these. The basic incentives of each system

>are, frequently, contradictory. However, during the period of transition to

>fixed reimbursement systems, there will be a mix of clinical care that

>falls within each of these two systems - cost and fee based reimbursement

>and fixed reimbursement.

>At times, the manager who is caught in this period

>of transition will find it necessary to manage the clinical practice in

>ways that may seem contradictory. This is often disconcerting to managers.

>It is usually confusing to staff.

>Many inherent differences in cost/fee

>reimbursement and prospective or fixed reimbursement systems have been

>discussed throughout this book. Some of the most critical are listed in the

>following table.

>Differences in Clinical Management in Emerging Managed Care Markets

>Area of Clinical Management Cost and Fee Based Reimbursement Systems

>Prospective and Fixed Reimbursement Systems

>Profit Focus on increasing

>volume to assure profitability Manage expenses to assume

>profitability

>Clinical Behaviors Focus on treatment effectiveness and

>efficiency Focus on case management effectiveness and

>efficiency

>Relationship with Payers Adversarial - Focus on attempts to

>secure more care and services for individual patients Collaborative - Focus

>on attempts to develop additional group contracts. Individual patient care

>issues less important to payer except as they relate to member satisfaction

>and group plan retention rates

>Clinical Outcome Satisfaction of key

>customers Satisfaction remains important but increasing emphasis on

>specific cost and clinical outcomes and effectiveness

>Financial Incentives

>Do more, charge more Do only what is needed

>Note that the items listed in the above table or descriptions of what the

>different systems encourage, not what is morally or ethically appropriate.

>Challenge #2. Determining when clinical care is finished.

>In a cost

>reimbursed or fee for service environment, mistakes related to

>inappropriately delayed patient discharge carried no real financial penalty

>to the provider. This is dramatically different in a fixed reimbursement

>environment.

>One of the most difficult decisions that a rehabilitation

>clinician will need to make is the point of termination of clinical care.

>Determining when a patient is " done " becomes very important in managing

>costs and presenting a practice profile that demonstrates clinical

>efficiency.

>

>The Patient Recovery Continuum, as illustrated in the chart, show a

>typical pattern of patient recovery during the process of rehabilitation.

>Initially, there is a relatively rapid rate of recovery. Over time, the

>recovery slows. Eventually, there is a tapering off of the recovery to a

>point we often call a plateau. In many cases the cost to deliver

>rehabilitative care is relatively constant throughout the course of

>therapy. This creates an early period where the return on investment (cost

>of care compared to amount of recovery) is relatively high compared to

>later periods of plateau. Although any individual patient's recovery is

>likely to differ from this pattern, it will still be necessary to determine

>the point at which further therapeutic intervention (in the current venue)

>should be terminated. Few decisions have as significant an impact on the

>financial well being of the clinic.

>As managers and leaders, we will need

>to work to help staff determine the appropriate termination point so that

>patients receive optimal value from our clinical interventions without

>unnecessary financial burden on our practices.

>

>Challenge #3. Disproving the null rehabilitation hypothesis.

>Especially in situations where there is capitation of the primary care

>physician or fixed reimbursement to a facility, it will be necessary to

>demonstrate the financial value (to that physician or facility) of

>rehabilitation. Because in PCP capitation and prospective reimbursement to

>facilities, the real purchaser of rehabilitation is that PCP or facility,

>our ability to influence them to view rehabilitation as a financial

>investment will be critical. There are financial incentives in fixed

>reimbursement systems to NOT refer to rehabilitation services. This is in

>stark contrast to previous cost and fee based reimbursement systems which

>had financial incentives inherent in them to refer to rehabilitation

>services. We will need to demonstrate that rehabilitation is necessary for

>optimal patient recovery. The focus of that demonstration will need to be

>the local decision makers - the primary care physicians and the decision

>makers internal to facilities who will control the health care dollar. This

>leads to Challenge #4.

>

>Challenge #4. Handling the shift from national and regional decision

>making to local decision making.

>Historically, health policy, including rehabilitation referral guidelines,

>was determined at a national or regional level. Patterns of referral to

>rehabilitation services were similar to those of patient entry into the

>health care system as illustrated in the following chart.

>As managed care continues to develop in any given market, there is a shift

>in how patients enter the health care system and a shift in health care

>decision making to the local managed care organization. The following chart

>illustrates entry into the health care system under a managed care model.

>It also illustrates the new relationships within the health care system.

>In order to succeed in the managed care model of health care delivery,

>rehabilitation professionals will need to develop new skills to become more

>influential with the decision makers at a local level. We can no longer

>assume that policy decisions will be made at a national (Congress or HCFA)

>or regional (Multi state commercial insurer) level. Medical practice policy

>decisions will increasingly be made by the administrative or medical

>officers of the local HMO or other managed care entity. To influence these

>individuals, we will need to first identify them and then be able to have

>access to them. Lastly, we must be effective in our discussions regarding

>the impact of rehabilitation services on the patient and the financial

>status of the facility or PCP.

>

>Challenge #5. Developing systems to identify competence. Becoming

>intolerant to incompetence.

>Because the rehabilitation provider assumes

>significant financial risk in many of the managed care models that will

>become prevalent in the future, we must be able to identify clinical

>techniques and practices that are not effective or that are wasteful. We

>will also need to develop mechanisms to identify clinicians who are

>ineffective. Quality improvement programs and outcomes management programs

>are important in the identification of both practices and clinicians who

>are ineffective. We need to become quite intolerant of ineffectiveness and

>incompetence. Both of these are serious threats to the rehabilitation

>industry.

>In an environment that is searching for demonstrated outcomes

>and effectiveness, there should be little tolerance of the incompetent

>clinician or ineffective clinical practice. There is just too much at stake

>to ignore these issues.

>

> R. Kovacek, MSA, PT

>KovacekManagementServices, Inc.

>The FOCUS Group, Inc.

>20225 Danbury Lane

>Harper Woods, MI 48225

>

> Fax

>Email Pkovacek@...

><http://www.theFOCUSgroup.net>

>

>

>----

>Read this list on the Web at http://www.FindMail.com/list/ptmanager/

>To unsubscribe, email to ptmanager-unsubscribe@...

>To subscribe, email to ptmanager-subscribe@...

>--

>Start a FREE E-Mail List at http://makelist.com !

>

----

Read this list on the Web at http://www.FindMail.com/list/ptmanager/

To unsubscribe, email to ptmanager-unsubscribe@...

To subscribe, email to ptmanager-subscribe@...

--

Start a FREE E-Mail List at http://makelist.com !