Risk-contract engagement strategies should differ for independent, employed docs

If your organization is participating in a risk-based contract, you are likely working hard to engage physicians in that effort. But are you modifying your engagement efforts based on whether participating physicians are independent or employed?

You should be, according to John Harris, director of Veralon a national healthcare consulting firm. “One of the things we’ve seen is that the differences between independent and employed physicians have grown over time,” says Harris, who recently presented a session on the topic at the National Association of Managed Care Physicians Fall Managed Care Forum in Las Vegas. “You’re dealing with two very different sets of challenges for two very different kinds of physicians.”

Harris co-presented with Kevin Hoppe, chief operating officer of Lahey Clinical Performance Network based in Beverly, Massachusetts. Their Medicare ACO reported shared savings of $4.61 million in the 2015 performance year.

Here’s more on how engagement challenges differ for independent and employed physicians, and how you can tailor your engagement efforts accordingly.

Difference #1: Independent physicians have more infrastructure needs

Employed physicians tend to have more technology resources that are helpful in risk-based contracts, such as an EHR that is integrated or interoperable with the hospital’s EHR, says Harris. Employed physicians also tend to have better care management support, he says.

Luckily for independent physicians, the tools for achieving information flow are improving, and health information exchanges and add-on tools can help disparate EHRs communicate. Still, your organization should be aware of this challenge and work to help address it with independent doctors.

Regarding the care management challenge, Harris says providing centralized care management support to independent doctors can be helpful. “Independent physicians often struggle to have the staff to do follow-up calls, care planning preparation and post-discharge check-ins with patients,” he says. “A structured, centralized program to provide that for independent physicians is often a very helpful step to take. The employed physicians might already have that built in as part of the employed medical group infrastructure.”

Difference #2: Independent physicians might be less inclined to work toward the shared goal 

Independent physicians, naturally, tend to have a more independent mindset. This can be a barrier when trying to achieve the cooperation and coordination needed to succeed under a risk contract, says Harris.

“Usually, the key is making it economically meaningful to them to be engaged, and when it is economically meaningful, most will pay attention to the results,” he says.

A monetary incentive of $10,000-$20,000 annually for strong performance under the risk contract is a motivating target for independent primary care physicians, says Harris, though he’s seen arrangements where physicians receive twice or three times this amount.

Next: Difference #3

Difference #3: Employed physicians might not be as motivated by financial implications

One advantage of working with independent physicians in a risk contract, Harris says, is that the reward associated with the risk contract will go directly to their bottom line, and therefore, their compensation.

Employed physicians might not see such a direct tie between their performance and the financial implications.  “Independent physicians tend to feel the financial results more directly,” he says. “Often with employed physicians, the compensation arrangement with the health system will blunt those rewards from risk contracts.”

Take a fresh look at your compensation design for employed physicians, and align it with the risk-contract objectives, says Harris. Ensure rewards flow directly to physicians, or institute proxy measures that align with the risk-contract measures and tie a big enough bonus to those measures. 

Dialogue required

All physicians, regardless of employment situation, will be more engaged in risk contracts if they are part of the dialogue, says Harris. “Set up discussions so that physicians can really speak together and figure out the better ways to provide care,” he says.

To get physicians more motivated in these discussions, share performance data. For example, show them a chart illustrating how each physician is doing. Initially labeling the physicians A-F on the chart can help smooth the discussions. Each physician should be told in advance, privately, which letter corresponds to him, so that he can see where he stands relative to his peers. Over time, it may be possible to shift to revealing names, says Harris.