You Should Know...
The Medicare Payment Advisory Commissions annual report was released this past week and I read all 346 pages so you don't have to.
Of special interest to Medicare Advantage plans and providers, the 2017 payment adjustment for coding intensity will reduce payments by 5.77%, more than offsetting the average 3-4% increase due to quality measures during the same time period. This continues a trend that has been slowly accelerating over the past few years, with reductions in payments increasingly outstripping the gains from meeting quality measures.
For high performing organizations who do a good job both meeting quality measures and harvesting risk codes, revenue growth in the future is going to have to come from:
- Growth in covered lives
- Harvesting the more esoteric, hard-to-find and document risk-codes
- Cost control
Unfortunately, in the practical world, these three factors are often in conflict with one another. It's hard to grow covered lives no matter what your star rating if you get the reputation you are trying to control costs. Clinicians spending time harvesting risk codes won't do as well in patient satisfaction surveys. And if they're spending time harvesting risk codes, they won't be able to do as good a job controlling costs.
All this adds up to greater challenges as you try to grow your revenues beyond the 5-10% yearly growth in the Medicare population. In fact, it's really only that organic growth in the Medicare population itself that makes Medicare Advantage the opportunity for providers that it is. If that organic growth should go away, say by dramatic payment cuts in an effort to address the Federal deficit, the potential of the program as designed will turn on a dime.
What to do?
If you are a high-performing organization, wholly dedicated to excellence, make sure your clinicians are trained, aligned and onboard with your strategic plans. If you have not consciously educated them, I promise you they are clueless.
If you are not performing well, understand that the world of easy accelerated revenue growth in Medicare Advantage is coming to an end and you're going to have to invest in your plan's infrastructure to catch up. Just where you want to invest is the question. The larger organizations are investing heavily in quantitative analysis and customer service. Be different. Change it up.
Invest in your care delivery instead.
The very best care delivery will always put the clinician-patient relationship at the center of every strategic decision—and every tactical one as well. Read on for an insight on one tactic for building that strong clinical relationship.