How Cardiology Compensation is Changing

As payment models in healthcare shift away from fee-for-service, some provider organizations are changing cardiology compensation contracts to reflect value instead of volume.

This article appears in the July/August 2015 issue of HealthLeaders magazine.

The march toward value-based reimbursement isn't being made with confident steps. That's because most healthcare providers are living in a fee-for-service world. Having a foot in value-based care while still getting paid on volume is a difficult reality, especially within the cardiology service line, because it is heavily weighted on relative value unit generation. But some organizations are facing the challenge head-on by tying a portion of cardiologists' compensation to quality metrics.

Compensation for the specialty traditionally has been based on productivity, and while that still is the foundation of most contracts, some organizations are renegotiating compensation that relies less on RVUs and instead rewards physicians for things that do not generate revenue, such as patient communication, documentation, and professionalism.

"Our compensation model is still weighted toward fee-for-service and reimbursement based on generation of RVUs, but within that is a significant and growing component of rewarding for nonclinical work," says Edward Fry, MD, chair of the cardiology division and physician director of the cardiology service line at St. Vincent Medical Group, a physician-led multispecialty medical group with more than 600 providers that is part of St. Vincent, a 22-hospital health system based in Indianapolis, which is part of St. Louis–based Ascension Health.

Fry says cardiologists and other specialists have to be willing to accept changes in how they're paid because value-based care reimbursement will not support a volume-based paycheck.

"Everybody sees the handwriting on the wall," says Fry.

Until recently, that handwriting was faint. Value-based care reimbursement was on the horizon, but there were no clear goals and there was no definite end to fee-for-service. The Centers for Medicare & Medicaid Services has funded several value-based pilot programs over the past few years, such as the Hospital Value-Based Purchasing program, the Pioneer ACO program, and the Bundled Payment for Care Initiative, and commercial payers have rolled out their own proprietary value-based programs. But it wasn't until January that the ambiguous future of what a value-based care reimbursement system might look like became clearer. CMS announced an aggressive and ambitious schedule of tying 85% of all Medicare reimbursement to quality by 2016 through its value-based purchasing and readmission-reduction programs.

Fry and others are skeptical of those goals, but they are a signal that healthcare executives cannot and are not ignoring. At some organizations, the first target is transforming cardiology compensation contracts to reflect value instead of volume.

Success key No. 1: Evaluate cardiologists' contributions

At Spectrum Health Medical Group, a multispecialty physician group that includes 1,100 providers and is part of the Grand Rapids, Michigan–based Spectrum Health, a nonprofit health system that includes 11 hospitals, 170 ambulatory sites, and a health plan, leaders completely abandoned a productivity-based compensation model for its 38 cardiologists and opted instead for a straight salary compensation package, with two opportunities to earn more based on quality metrics.

Not many groups outside of Cleveland Clinic have attempted to pay cardiologists a straight salary, but Spectrum's venture could signal to other cardiologist groups and large health systems that the specialty is ready for a new compensation structure.

"Clearly, you can't live in a value-based world and pay people in fee-for-service," says Darryl Elmouchi, MD, FHRS, division chief of cardiovascular medicine at Spectrum Health Medical Group. "The hard part is we still live primarily in a fee-based world, so we sat with providers, leaders, and asked, 'How are we going to change?' We all agreed that we had to change physician compensation. Cardiology was the tip of the spear."

The medical group's primary care physicians also are working on a transition to the model the cardiologists adopted, which is a straight salary that has a 10% withhold for citizenship, a measure made up of four separate metrics: clinical productivity, program development, scholarly activities, and clinical excellence.

"The clinical productivity metric is not RVU-based," says Elmouchi. "It is essentially, 'Are you doing the things we ask you to do?' A distant outreach clinic is good for patients and the organization, but for the individual provider, it could mean some slow clinic days where they don't have a lot of RVUs, and to judge someone based on that seems counterintuitive to us."

Elmouchi says cardiologists can earn part of the 10% salary that is withheld, so it is not "all or nothing."

"We have a scoring system," he says. "I meet with everybody in the beginning of the year to hear what their plans are, and then at the end of the year to give them a grade. We hope everyone gets the 10%, but not everyone will."

Spectrum Health Medical Group cardiologists also have an opportunity to earn a bonus of up to 5% if they meet patient satisfaction and other goals. There are six metrics that cardiologists will have to meet to earn the 5% bonus, with each metric weighted to reflect the system's goals. For example, 0.5% is tied to patient satisfaction, which Spectrum Health Medical Group measures with the CG-CAHPS survey, a tool that assesses patient satisfaction in clinic settings.

Another 0.5% is dependent on Spectrum Health meeting its financial goals, which Elmouchi says is less strict.

"If the whole system goes bankrupt, they're not giving us a bonus," says Elmouchi.

Another 0.5% is earned if cardiologists meet the goal of sending a provider note about the patient. This metric is new and is one of several metrics tied to the 5% bonus aimed at improving certain physician behaviors, explains Elmouchi.

"A lot of electronic notes are generated that get sent to a primary care doctor," he says. "We want to have a personal note describing the patient's experience and their plan. The goal is to have 60 notes sent. For many of our providers, that's a very small number, but the whole goal is to change behavior and push people to do that and make it part of their standard work."

Two other bonus metrics that aim to change physician behavior are more heavily weighted, at 1% each: access and patient calls.

"We want to improve access," says Elmouchi. "We put a goal that we would be able to see any patient for any problem within 10 business days. And when patients call with a concern, we want quick providers to have a 48-hour turnaround for those calls."

The metric that is weighted heaviest for the 5% bonus is the departmental budget goal. As long as the cardiology department doesn't exceed its budget, the physicians will receive 1.5% toward their bonus. This metric isn't the only one that is shared. The CG-CAHPS score that makes up 0.5% isn't based on the cardiologists' individual scores; it's based on the department's scores.

This new compensation model was just rolled out in January, and it took about a year to put together.

"If you would have talked to us two years ago about going away from productivity, I wouldn't have guessed it could happen," he says, adding that, so far, he gives the effort a solid B because reengineering work flows to improve things like access takes time.

Success key No. 2: Be willing to change

While the switch from an RVU-based compensation package to one that is straight salary is not well-suited now for every organization, some leaders are taking incremental steps toward linking quality to cardiology compensation.

For example, 85 cardiologists in the St. Vincent Medical Group, which staffs cardiology programs including St. Vincent Heart Center, just renegotiated their compensation contract, and it stipulates that a smaller portion of cardiology compensation will be based on RVU clinical production. Going forward, 80% of cardiologists' compensation will be RVU-based, and 20% will come from management and quality metrics. In previous years, the split was 90/10.

"The portions of compensation directly related to meeting certain quality metrics will grow over time," says Fry, who is also a member of the American College of Cardiology's board of governors. "There is more recognition of the nonclinical work and a better valuation for things cardiologists do other than providing straight clinical services. This is fairly common for what is going on around the country."

The reduction of dependence on RVU generation also reflects a national decrease in RVU production, according to Fry.

"In the past two years, RVU production nationally is down 5%?9% per year, and that's because cardiologists are doing fewer procedures, less testing, all of which is guided by appropriate use," says Fry. "They are also being asked to do more in terms of documentation, compliance, and chronic disease management, so it's a way toward overall patient management."

Cardiologists at St. Vincent may not be paid the same way as those at Spectrum Health, but there are similarities in the way they are measured. Fry says the 50 metrics St. Vincent uses to measure cardiologists' adherence to quality benchmarks is a "mixed bag" of CMS core measures, system metrics such as patient satisfaction, and a scorecard from one of its commercial payers. With the renegotiation of its compensation contract, Fry says there will be a menu of measures that cardiologists will agree to every year.

"There's some dynamic nature to it," says Fry. "The feeling is once you reach near 100% compliance, move on. Stop rewarding the same thing over and over."

St. Vincent also includes quality metrics that are aimed at changing physician behavior. For example, Fry says he wants to incentivize cardiologists to perform percutaneous coronary intervention in a certain way.

"It's not based on the volume of the procedure; it's to shift from femoral catheterization to transradial, for which there is better patient satisfaction, less bleeding, shorter length of stay."

The new goal is to have cardiologists perform at least 25% of PCIs via transradial access, and that percentage likely will increase over time. Directing cardiologists toward procedures or practices that have been proven to reduce length of stay, for example, can have a direct impact on the bottom line, which is a goal of value-based care.

Although St. Vincent does not draw a straight line from care to cost yet, there is some indication that its cardiologists are moving in the right direction. St. Vincent Heart, the hospital staffed by the medical group's cardiologists, has received an annual bonus three years in row from CMS for performing well in the agency's Hospital Value-Based Purchasing program. VBP measures hospitals' quality, process of care, patient experience, outcomes, and efficiency. Through the program, CMS withholds a certain percentage of inpatient payments from each hospital. If the hospital does well, it effectively earns a bonus; if not, then the withheld money is lost. In the first measurement period, October 2012?September 2013, St. Vincent Heart earned a bonus of 0.35%; in the second reporting period, the bonus increased to 0.46%; and the third reporting period shows a bonus of 0.54%. The maximum amount a hospital could earn or be penalized ranges from 1%?1.5%, depending on the year.

Fry says that St. Vincent's cardiologists are open to moving toward a compensation package that is less reliant on clinical productivity because of St. Vincent Heart's success with VBP. The cardiologists were able to earn the bonus, in part, because of the group's long history together, he says. Although they are part of St. Vincent now, the group was independent until 2010 under the name The Care Group, which was a large cardiology practice.

"We've been one unified group for a long period of time, and we haven't been sidetracked with cultural changes, which can take a long time," says Fry. "That's one of the challenges holding cardiology groups back. Until value-based reimbursement becomes part of the vast majority of the primary care base, there will always be a measurement of reimbursement based on clinical productivity for specialists. I think specialists will be slower to transition than primary care."

Success key No. 3: Capitalize on culture

The one place that does not have to transition its cardiologists to a new compensation model is the Cleveland Clinic, a nonprofit academic medical center that is known for its straight salary model. With the move toward a value-based reimbursement system, Rob Coulton Jr., MBA, executive director of professional staff affairs, who sits in on all annual performance reviews and oversees the review process, says he knows that the clinic's compensation strategy is a model for other systems.

"To organizations trying to change, I respect how hard that is," he says. "The culture is so strong here. If you are the 132nd cardiologist in the cardiology department, accepting the salary model is quite easy."

Cleveland Clinic has 140 cardiologists on salary, but, says, Steven Nissen, MD, chairman of cardiovascular medicine at the hospital's Heart & Vascular Institute, that doesn't mean that their compensation formula has not evolved.

"We made a decision in 2012 to approach cardiovascular medicine compensation with a far more systematic and metric-based approach, not just a general impression of performance," says Nissen.

Instead of rewarding cardiologists based on seniority, which was the norm, Nissen says the department developed what it calls an IP-3, Individual Physician Performance Profile. It's a detailed collection of nearly 90 metrics on cardiologists' clinical and nonclinical performance.

"There are 38 metrics that we collect on every physician in our department of cardiovascular medicine for clinical performance, and then another 50 or so metrics for nonclinical, academic, national leadership, publications, etc.," says Nissen. "They are highly detailed, and they are provided to each individual and to the chair prior to annual performance reviews."

The metrics are a mix of core measures that CMS uses to rate heart care, and there are also Cleveland Clinic?specific metrics, such as closing patient encounters. Nissen says they were not measuring that initially in performance reviews but noticed that some providers left their patients' records open for several days. That can lead to delays in patient care. With the addition of a metric to close patient encounters the same day a cardiologist sees a patient, Nissen says open records are "virtually eliminated."

Despite the strong culture that exists at Cleveland Clinic, introducing cardiologists to a more comprehensive set of metrics was met with resistance. There was pushback that eventually faded, but Nissen says he had to fight the "ivory tower" mind-set.

"There has been sort of a mentality that's existed at academic medical centers for a long time of 'We're here to do what we want to do, and we're accountable only to ourselves,' " says Nissen. "What we said is, 'We're accountable to each other. Our performance as a group needs to get better as individuals.' "

Nissen says high performers who feared being scrutinized realized they had nothing to worry about, and the low performers got better. In the three years that the detailed scorecard was used for its cardiologists, he says the bottom 10% increased their performance by 19%; the top 10% increased by 4%?6% in overall job performance.

"That means the good people got better, and the people that weren't doing quite as well got a lot better," he says. "That's what we hoped would
be accomplished."

Holding individual cardiologists accountable for their performance has impacted patient care, too. Nissen points to the door-to-balloon-time performance measure for heart attack patients. The current guidelines recommend a benchmark of 90 minutes or less. Nissen says Cleveland Clinic's door-to-balloon time was better than that benchmark last year, but now it is down to 47 minutes.

"That means the patient gets evaluated; you get their EKG, make a decision, get them into the catheterization lab, and get the coronary open," says Nissen. "We pushed those metrics because we are tracking all of this and reporting to each other. I didn't think we could get to 47 minutes, but we did."

Targeting one of the highest-paid specialties with a focused approach on metrics that determine its value to the organization is one way to prepare for value-based reimbursement. The road to get there is not smooth, but it is not vanishing either, says Elmouchi.

"This is a new era; this is how we're all going to do better."

Reprint HLR0815-10