Predicting Wound Clinic Business Trends: A Panel Discussion

“Hyperbaric oxygen therapy utilization will decrease by at least 50% (likely more) as payers find ways to limit coverage through a variety of methods (eg, making many indications noncovered, limiting total treatments, expanding prior authorization and pre-payment review, etc.). The entire economic model of wound practitioners and wound centers will need to change. Clinicians and hospitals will undergo fraud audits as a result of the U.S. Department of Health & Human Services and the Department of Justice’s HEAT (Health Care Fraud Prevention and Enforcement Action Team), a group tasked with, among other things, gathering resources to help prevent waste, fraud, and abuse in Medicare and Medicaid programs and to punish people and organizations who abuse the system. Medicare audits and denials will dramatically increase documentation requirements for everything associated with wound care, but particularly advanced therapeutics and debridement as clinicians document their strict adherence to coverage policies. Electronic health records (EHRs) will need to rise to this challenge, incorporating relevant clinical practice suggestions and producing reports linked to enterprise-level corporate compliance plans. The Centers for Medicare & Medicaid Services will pilot ‘episodes of care’ or ‘bundled payments’ on the outpatient side (similar to inpatient diagnosis-related groups), so some wound centers will need to ‘go at risk’ with these payment models. The trend for therapies such as cellular products will be to demonstrate not just that they are effective, but that they can reduce episode-based costs for conditions such as diabetic foot ulcers. The implementation of the Medicare Access and CHIP Reauthorization Act will decrease physician revenue and push clinicians to join large networks or become employees. Whether advanced practitioners ‘survive’ the transition to the Merit-Based Incentive Payment System will be determined by their success at reporting quality measures. Although this marks the eighth year I have said it (so far without success), eventually the wound care industry will have to fund broad-based (including patient-reported) quality measures. Otherwise, wound care centers and wound care providers will cease to exist. More importantly, given the absence of government investment in wound research, wound care stakeholders will have to fund data analysis from patient registries to determine the most cost-efficient way to heal wounds — meaning, how to heal wounds with the least number of interventions, rather than with the most.” 

— Caroline E. Fife, MD, FAAFP, CWS, FUHM, chief medical officer, Intellicure Inc., The Woodlands, TX; executive director, U.S. Wound Registry; medical director, St. Luke’s Wound Clinic, The Woodlands, TX; co-chair, Alliance of Wound Care Stakeholders; clinical editor of TWC.

“The way things are going in wound care, whether you think it is fortunate or unfortunate, there’s a severe clamping down on hospital-based outpatient departments (HOPDs) and a movement to reconsolidating the services to outpatient physician practices. With the current trends of preauthorization and bundled payments to the HOPD, it’s conceivable that more physicians will move patients to outpatient office settings. This can be fortunate for the payers, as the reimbursement for office-based services is generally less than that of the HOPD. Unfortunately, the same holds true for the opposite. Physicians will have to schedule outpatients or time to perform more costly services such as epidermal grafting, split-thickness skin grafting, and application of cellular and tissue-based products. Since hyperbaric oxygen therapy (HBOT) is also a target, figure the HBOT services to the HOPDs will also decrease. The best way to attack and stay ahead of these changes is to anticipate them as they are released by the Centers for Medicare & Medicaid Services and via the draft releases of local coverage determinations. Those organizations (private and hospital-based) that stay ahead of the curve can manage and continue a foothold within the industry. It’s imperative that we all speak with one voice, and that type of engagement needs to occur quickly in order to combat the coming changes from government and private insurers.” 

— Eric J. Lullove, DPM, CWS, FACCWS, medical director, West Boca Center for Wound Healing, Boca Raton, FL; owner, Laser Love Med Spa, Boca Raton; healthcare policy committee, Association for the Advancement of Wound Care (AAWC); AAWC liaison, Alliance for Wound Care Stakeholders; consultant, Hollister Wound Care, Libertyville, IL, Medline Industries Inc., Mundelein, IL, Osiris Therapeutics, Columbia, MD, Human Regenerative Technologies, Redondo Beach, CA, and Cumberland Pharmaceuticals, Nashville, TN.

“With the election year upon us, health policy in the United States has received increased attention, with the majority of the discussion focusing on three issues: 1) the ongoing growth of national health spending; 2) the Affordable Care Act (ACA); and 3) Medicare reform. National health expenditures, which grew 5% last year and now make up 17.6% of the country’s gross domestic product, are forecasted to continue to grow 6% annually through 2023! The future of the ACA remains a hot topic in the presidential race — with one party supporting the legislation and the other promising its repeal, but I think one thing is for certain: We will continue to see reimbursement models for providers and hospitals shift from fee-for-service to value-based care and bundled payments. Therefore, it has never been more important to focus on patient-centric, evidence-based care leading to the most cost-effective outcomes. In the short term, this will require continued compliance and focus on current government regulations and penalties relating to wound care, including the Physician Quality Reporting System, Meaningful Use, ‘never events,’ and readmissions, to name a few. However, I believe the mid- to long-term wound care business landscape will swing the pendulum towards more efficient data collection; documentation; and cost-effective, population-based care models using advances in both clinical and operational technology — such as diagnostics, wound-severity scoring, and telemedicine. It will be very interesting to see how our current clinical practice patterns and reported metrics change when the money comes out of our own pockets!” 

— Chris Morrison, MD, executive medical director, Healogics Specialty Physicians, Jacksonville, FL; medical director, Wound Systems, Atlanta, GA.

“Wound care businesses of the future will be forced to balance their current volume-based payment systems with new value-based payment systems. This shift will be led by the qualified healthcare professionals (QHPs) who manage wound care patients. In 2015, Medicare began implementing a new payment system for QHPs. Rather than experiencing annual pay increases, the Medicare Physician Fee Schedule will be frozen after 2019. The QHPs will continue to code and bill exactly as they do today, but their payment rate will remain flat. In addition, the QHPs will have the opportunity to receive Medicare bonuses if they meet the quality and value-based requirements of their new Medicare payment system. Those bonuses will be funded by penalties that will be incurred by QHPs who do not meet the quality and value-based requirements. To achieve these new Medicare payment bonuses, QHPs will focus on doing the ‘right thing’ for the ‘right patient’ at the ‘right time.’  They will rely on proven clinical practice guidelines, published clinical trials, etc. They will diagnose patients’ underlying conditions early and address them aggressively. They will select procedures, devices, drugs, biologics, and dressings based on achieving the best outcomes at the ‘total lowest cost of care across the continuum of care,’ rather than based on the revenue they may personally generate. They will also take the patients’ coinsurance into consideration because patient satisfaction will include clinical, financial, and service satisfaction. In fact, QHPs may actually choose to replace their personal revenue-generating procedures with advanced technology. Because QHPs’ diagnoses and orders drive chronic wound care in all sites of care, the QHPs will help the entire continuum of care to also meet ‘Triple Aim’ goals established by the Institute for Healthcare Improvement: 1) improving the patient experience of care (including quality and satisfaction); 2) improving the health of populations; and 3) reducing the per capita cost of healthcare. This change in focus from volume to value will also help chronic wound care professionals in all sites of care align with their private-payer contracts, which are extremely focused on the Triple Aim.” 

— Kathleen D. Schaum, MS, president and founder, Kathleen D. Schaum & Associates Inc., Lake Worth, FL; director, medical products, reimbursement, Smith & Nephew, Fort Worth, TX.

“Healthcare is changing at a rapid pace, particularly in the post-acute care arena. The move from a fee-for-service model to one of a value-based market is seen most acutely in settings outside of the acute care hospital. The long-awaited trials of accountable care organizations and the Centers for Medicare & Medicaid Services’ Bundled Payments for Care Improvement Initiative is forcing providers to look toward partners who will work with one another to care for the disease/ailment as well as for the entire disease process that the patient is presenting with. In the outpatient wound care world, this will mean forming alliances with multiple disciplines and professionals to effectively and efficiently care for the patient to prevent wound recurrence and hospital readmission. For years, wound centers have often been ‘siloed’ from other providers — caring for the wound alone and simply referring other issues that the patient may be living with to other practitioners outside of the clinic (with little collaborative care or sharing of information until the patient is discharged). I foresee a time very soon where referrals to other providers happen more quickly and referrals to the wound center occur earlier in the disease process. We are also experiencing greater sharing of information through electronic health records that allow us to have a clearer picture of the patient while taking some of the ‘guesswork’ out of evaluations and assessments.” 

— Valerie Sullivan, PT, MS, CWS, director of quality and risk management, HealthSouth Rehabilitation Hospital Tallahassee (FL)HealthSouth Rehabilitation Hospital Tallahassee.