Focused Session on the Business of Healthcare Offers Pearls for Everyone

Hollywood, FL (January 22, 2020) -- The International Symposium on Endovascular Therapy (ISET) 2020 started its first day with a provocative and informative session on the business of healthcare.

Physicians can no longer focus solely on the clinical part of healthcare, suggested session moderator Barry Katzen, MD. They not only have to understand the business side of things, but they also need to be active participants in the “business of medicine,” he said.

Business decisions abound in healthcare and physicians are often the best ones to make those decisions, according to Michael Jaff, DO, Vice President of Clinical Affairs, Innovation, Technology and Peripheral Interventions at Boston Scientific. “If you haven’t been in a consult room with a sick patient and accepted full responsibility for the outcome, you cannot possibly know all the ramifications of ‘business decisions’ in healthcare. I think it's just that simple,” said Dr. Jaff.

As seen in other fields, domain experts perform better than non-domain experts, he suggested. Scholars promote greater research productivity in universities, former all-star basketball players make for better coaches. And hospitals run by physicians score about 25% higher on quality.

“The fact that you've been in the trenches and know what it's like. Certainly, when you talk to patients and donors as a hospital president and as a physician, there's a degree of credibility, you know, understanding and in addition, physicians tend to understand organizational priority,” said Dr. Jaff.

Being a good doctor, of course, does not always transfer to being a good leader. Emotional intelligence is important. “This is actually being able to read a room and understand [how] the way you sit, the expression on your face and the tone of your voice can have huge impact on your workforce. Conflict resolution is what you'll do the majority of your day,” said Jaff.

Physicians needn’t have the skills of a CFO, said Dr. Jaff, but they do need to understand finance and population health, and learn leadership and management skills. Options for acquiring the needed knowledge range from a healthcare-focused executive MBA to on-the-job training.

“Ultimately, I believe physicians are best suited to deal with the chaos of healthcare. We deal with chaos every day when we're taking care of complicated patients and system failures and complications from procedures. So, chaos is not unique,” said Dr. Jaff.

To finish his talk, Dr. Jaff suggested that the biggest threat to the business of healthcare, which is a threat to any business, is being non customer-centric: “Netflix didn’t kill Blockbuster Video; Blockbuster did it to itself with ridiculous late fees and the need to go to a store. Uber didn’t kill the taxi industry; the taxi industry did it to itself by limiting the number of available taxis and regulating fees. And Apple didn’t kill the music industry; the music industry did it to itself by forcing people to buy full-length albums.”

Moving more into the details of healthcare, Gary Ansel, MD, spoke on the decision to be employed or non-employed, which he noted is #4 on the list of top practice management challenges for vascular care providers in 2020.

Especially or physicians finishing their fellowship, this decision looms large. “You could do whatever you want and there'll be room for you, because the population's exploding and there are going to be shortages in every population of physicians that treat vascular disease,” said Dr. Ansel, who chose the self-employed option at OhioHealth in Columbus, Ohio.

In recent years, the proportion of physicians opting for employed positions has increased from 14% in 2012 to 26% in 2015. In the midwest, said Ansel, the rate is 49%.

“I think [being] in private practice is harder in an uncertain environment. There’s decreased office-based reimbursement and increase administrative costs and burden,” said Ansel. There is also a breakdown of traditional referral patterns — referring physicians don’t go to meetings, read their mail, and insurance contracts are growing in numbers. 

Hospitals want to employ physicians to prepare for payment reforms and control their costs, said Ansel. While physicians are choosing that route to counter stagnant reimbursement rates, rising costs of private practice, and a desire for a better work-life balance.  If you look at…Generation X and millennials, what drives them? The number-one thing is time off,” said Dr. Ansel.

As for compensation, employed physicians tend to earn more just out of training than self-employed physicians, but the latter catch up and surpass those in salaried positions as they grow their practices and income (Figure 1). “Despite the overall gap between employed and self-employed physicians, around 70% of physicians are employed compared to 26% who identified as self-employed,” he added.

Regardless of where you work, said Ansel, practicing ethically in what has become an “unethical world” is a challenge. In a hospital-based world where administrative pressures can be strong, the challenge can be harder.

“I want to make sure we all understand something: not-indicated procedures are assault and excessive billing is stealing. As physicians we have to live by this. However, counter to that, holding appropriate treatment is also a crime.”

“The reality is physicians aren't always altruistic…and everybody's pointing fingers at us, right? It's because of we are the caregiver, but in [Figure 2 you can see] the number of administrators compared to the number of physicians. The administrators don't provide care and they don't provide a lot of value, so [we can see that] there's enough blame for everybody.”

Echoing this concern, Christopher White, MD, noted that demand for high-reimbursement services is falling, pushing physicians towards outpatient services, where demand is increasing. “The traditional high-margin procedures that we did as hospital-based outpatient cath lab and the inpatient cath lab are now declining and we’re now having to come up with different models,” said White, who is the medical director of value-based care at Ochsner Medical Center in New Orleans.

“The hospital administrators who are running the ship are making decisions for us,” he said. Medicare and Medicaid reimbursements are dropping, and physicians and hospitals are feeling that decline. “Healthcare is the one industry where you know tomorrow will be harder than today. It will not be better,” said White, noting the opposite directionality of expense and revenue curves in health care today.

“My health system operates a little bit higher than a 2% percent margin, which means that if a hurricane comes and we lose a week of a business, we can't make ends meet even in a not-for-profit center,” said Dr. White.

The answer, he suggests, is a shift toward value over volume. But, as we transition to value, he said, we need to get paid for volume. “The problem isn't that we're paying doctors too much money. The problem is doctors will order the tests, they order the drugs, they order the procedures, they are spending the money, they're the spenders, not the administrators…”

So, while the physicians are paid for volume, they have to transition to value — be mindful of comprehensive and preventative care, address the cost per unit of care and issues of access to care. “Population health is not out enemy, it’s actually our friend. We need a huge population to feed the specialty care that we'd like to provide so that we are doing necessary procedures, necessary being procedures that benefit our patients make better outcomes,” said Dr. White.

And when we do appropriate procedures, value will support compensation, he concluded. “None of us are where we want to be in quality. That’s key. We need to reduce waste expense and variation.”

Providing a poignant example of targeted, high-value care, Yolanda Bryce, MD, told the audience about her experience in treating PAD in cancer patients. After talking briefly about how PAD patients are at particularly high risk for death and other adverse events, and how cancer incidence is increased in PAD patients while prognosis is worse, Dr. Bryce related her experience in setting up a non-invasive vascular imaging center at Memorial Sloan Kettering Cancer Center.

Dr. Bryce’s one-room clinic, with just one RPVI (her), is taking referrals like the 75-year-old woman she treated recently. The patient had life-style limiting, Rutherford 3 claudication, which was interfering with her cancer treatment. With interventional treatment, they were able to resolve her claudication and get her more active on her cancer treatment.

This is an example of “someone thinking differently,” said Dr. Katzen, about Dr. Bryce’s initiative. “And looking at something they have expertise in, but in a foreign environment, basically…it could be setting a trend.”