A New Compensation Model for Transplant Physicians
Transplant services were reported as one of the largest contributors to hospital margin with the highest relative margin contribution per operating room hour and per transplant event. As outlined by Axelrod et al, this is expected to change as the ACA is implemented. Though there are efforts to shield transplantation from some of the expected changes, transplant hospitals are more likely to face reduced Medicare payments given that most transplant patients are insured by Medicare or Medicaid. In addition, there will be reduced payments for too high readmission rates and for patients with hospital-acquired infections, both common to the transplant population. Furthermore, added costs to subsidize Medicaid expansion will likely result in reduction of Medicare payments to disproportionate share hospitals, many of which include transplant centers. As noted by the ASTS, the value-based payment modifier will affect a large portion of transplant surgeons in 2015.
Transplant physicians are in the unique position to act as stewards of scarce resources and practice complex medicine as a team. Outcomes are generally attributed to the team, and so are costs and quality of service. Physicians are called on to render complex clinical decisions and perform complex procedures any time of day or night to assure 24/7 coverage. Transplant work has become increasingly complex with the expansion of donor and recipient criteria to increase both donor utilization and transplantation rates while prioritizing the sickest first. Physicians also conduct many activities that are not accounted for in the wRVU model, such as taking call or additional call, travel for organ recovery, conduct of multidisciplinary team rounds, laboratory reviews, care coordination, travel to outreach clinics and for successful or aborted organ recoveries, quality and safety and process improvement, financial and contractual reviews, data registry management, regulatory oversight, education of contractual entities, to name a few. Furthermore, irregular surges in clinical activity require significant redundancy in calls to cover transplant procedures and additional postoperative outpatient care. Furthermore, transplant centers are accountable for long-term outcomes of transplant patients and their graft function, well beyond the transplant episode. It is critical for transplant centers to appreciate the joint accountabilities of hospitals and physicians as well as the leadership and stewardship roles of transplant physicians in this joint enterprise. Effectively, transplant physicians have practiced as a medical home decades before this term was coined. This requires years of extensive care coordination and care reviews without associated fees or compensation within current payment models. Medical Director fees are often used as surrogates to compensate transplant physicians and surgeons for these activities but are typically insufficient and do not account for the work effort of the transplant physicians who are not designated as directors. An effort should be made to estimate the time and effort required to accomplish such activities.
In response to changes occurring with the value-based payment structure, we propose a shift in emphasis on compensation plan components to include a "virtual RVU" (vRVU) component for transplant physicians (or perhaps a supplemental RVU) that is adapted to the needs of a transplant program and accounts for non-RVU activities in addition to promoting desirable outcomes. While we propose that this could be adopted by CMS for transplant specific compensation, the vRVU can currently be derived and adapted to the uniqueness of a transplant center and practice. Performance measures would be targeted to the needs of the program, its population, and the driving forces for the institution (Figure 1). Examples can include reduced cost per unit of care, reduced length of stay and readmissions, reduction in select adverse events (technical and medical), adherence to care bundles and pathways; the span could also expand to include measures of access to care and timelines to listing, interventions to address disparities in care and improvements in organ donation or even wellness measures for living donors and recipients over the long term. Many outcomes are attributed to a group or a program while some are personally attributed to a single physician. Hence in the design of incentives and gain sharing, models such as those developed for medical groups (CMS, Blue Cross Blue Shield) should be explored and gains attributed to the appropriate group of providers. Historically, once attribution is decided, dollars are allocated as a percentage of base compensation or other methods. The creation and funding of such vRVU would be subject to the review and approval of institutional leadership. Funding and functional alignment between transplant physicians and the transplant center cannot be overemphasized and are essential components for a sustainable and successful transplant center.
(Enlarge Image)
Figure 1.
Composite model for compensating the transplant professional.
The proposed CMS value-based modifier model (Figure 2) is designed to accomplish desirable goals with a focus on essential components of care delivery. In addition, models utilized for primary care that include quality outcomes, efficiencies and cost-savings with gain sharing should be explored for transplantation given the parallels that exist. However, we have great concerns that until such time those models adaptable to transplantation are developed, transplant professionals and institutions will not be ready for the necessary changes to move toward the value-based equation or other integrative broad compensation models. In addition, academic departments will always be at odds to support non-RVU activities within their constrained budgets. Therefore, an institutional-based solution needs to start addressing the gaps and the vRVU is likely to accomplish this goal.
(Enlarge Image)
Figure 2.
Value modifier scoring as outlined by CMS.
Rationale for the Virtual RVU
The American Medical Group Association reported that specialty physicians' compensation in 2012 was based on wRVUs (68%), base salary (40%), and other incentives (29%). This "other" category included departmental budget/goals (25% of respondents), department RVUs (20%), individual financial goals (20%), and institution financial goals (20%). Hospital executives and transplant physicians, whether employed group or private practice, have long worked together to create the transplant center infrastructure to meet regulatory and quality requirements for CMS certification. Increased clinical and financial integration will be necessary to meet the value-based payment structure.
In the context of service line models and care integration in transplant centers, a wide range of transplant physician activities (outlined above), described as non wRVU-producing activities, are vital to the success of a program (and hence the institution). The means to support such activities should stem from the collective revenues generated in an institution. Volume is not an ever increasing metric in transplantation. Hence, delivering on value and quality would be essential to generate the margins needed.
All such activities lead to the virtual RVU concept as a measure best addressed based on time and effort as a portion of total work effort. In the academic setting, teaching and research activities would still be rewarded as part of the institution's aRVU or could be calculated as part of the vRVU for institutions not yet recognizing the aRVU. It is important to note that assigning the aRVU to a department unit can potentially result in misalignment with activities and goals of the transplant center. Hence, given that such academic activity is still necessary for the advancement of education, science and the profile of the transplant center, the aRVU can be incorporated into the virtual RVU and hence allow for better alignment of activities and goals. A frequent debate is that there are no additional dollars for non-RVU work. Yet transplant physicians act as stewards of the transplant enterprise and their decisions have direct impact on the success of a program and its financial health. Hence, it is ideal to embed a component or all of transplant physician compensation within the institution transplant finances. This would include payment for non-RVU work and agreed upon performance measures (Figure 1). Such a model would allow for the necessary alignment needed for the success of the transplant enterprise, financial health of the organization, and a focus on priorities relevant to the center goals and objectives. Calculation of vRVUs can be accomplished with time studies or surveys estimating units of work for services necessary to the enterprise. These vRVUs are translated into dollar values based on agreed upon compensation units within the institution. A balance between wRVUs and vRVUs for each physician is needed; hence the need to understand the global costs and profitability of a transplant unit, inclusive of all transplant costs and revenues over the course of care leading to and beyond the transplant episode (hospital and professional).
While designing such models that consolidate the finances of all aspects of the transplant center, the enterprise must live and thrive within the framework of the revenues accrued for transplant-related work. In addition, leadership (professional and hospital) need to determine the intangible and indirect values of the transplant programs to their respective institutions while considering financial models and performance metrics. Hence, financial barriers within an institution will need to be addressed for such a model to be successful. In addition to allocation of dollars within the institution, credit attribution needs to be clarified. Team and program based approaches to team attributable outcomes are needed to assure success and engagement among all. As experienced in many centers, collaborative models have allowed transplantation to thrive in transplant centers resulting in expanded pools of dollars that can be utilized for such models of compensation. In addition, ancillary services tend to grow substantially with growth of the enterprise that also would aid in creative funding opportunities. Of note, cost avoidance is not considered by many centers as a reward opportunity; this is a misguided approach given the bundled approach to transplant payments and associated outlier risks. Greater challenges though relate to payers (CMS and private) especially when considering required budget neutrality. Strong coordinated efforts and lobbying are required by medical societies to educate payers on the nature and evolving transplant care model and role of payment reform for transplantation. In addition, our societies need to facilitate payer partnerships and collectively arrive at relevant measures, individual and group, that would supplant generic measures being pushed for general use. It would be anticipated that optimizing payments for professionals and creation of properly aligned incentives can be easily funded through improved transplantation rates, improved outcomes and efficiencies and a coordinated focus on long term health and effective utilization of healthcare resources.