OR Manager November/December 2021 - 15

OR business management
* pay for future volume/value of
referrals
Flow of funds
* pay a physician for individual performance
*
pay for historical performance
* pay a physician if quality or severity
decreases
* exclude qualified physicians
* pay physicians an unlimited amount
of money.
Value-based entities
Keys to success with value-based entities
are that:
* they require signed writing describing
value-based activities and purposes
* the type of compensation and methodology
must be set in advance
* outcomes must be objective, measurable,
and selected based on
clinical evidence or credible medical
support
* remuneration is for or results from
value-based activities undertaken by
the recipient of the remuneration for
patients in the third-party payment
system
* arrangement must be monitored
to ensure progress towards valuebased
purposes
* corrective action must be taken if
monitoring reveals shortcomings.
" The biggest takeaway from valuebased
entities is that there has to be an
at-risk component of at least 10% built
into the agreements or a contribution to
the compensation, " says Long.
The other big item that has come
through, and for which surgeons have
been asking, is that there is no pro-rata.
Instead of having to split, for example, a
savings of $100,000 among 20 physicians,
an organization now has the ability
in a value-based entity to distribute
those funds based on a different methodology.
" You
can look at higher-performing
physicians or contributors to the savings
as getting a bigger percentage,
or a bigger portion of the savings, "
Long says (sidebar, " Flow of funds " ).
www.ormanager.com
Source: Pinnacle Healthcare Consulting. Used with permission.
In addition, organizations frequently
contract with a group or multiple groups
that structure a simple limited liability
company (LLC). This way, the organization
deals with one entity as opposed to
dealing with five or six different groups.
One benefit to the organization is
that it must deal with just one, in theory.
Another benefit is that it forces the
physicians to work together in things
such as selecting an accountant for the
LLC, distributing funds, and building a
governance structure to deal with some
components in their decision making.
Overall, moving from a fee-for-service
to a fee-for-value system is progressing.
The adoption of value-based entities
is likely to increase over the next year
or so as organizations look to protect
themselves from future crises like the
COVID-19 pandemic. ✥
-Judith M. Mathias, MA, RN
References
Amodeo M. New Stark exceptions
mark shift to value-based care.
Faegre Drinker. December 9, 2020.
https://www.faegredrinker.com/en/
insights/publications/2020/12/
Long A, Arreola A. What the OR needs
to know about the new gainsharing
rules. OR Business Management
Conference. 2021.
new-stark-exceptions-mark-shift-tovalue-based-care.
Centers
for Medicare and Medicaid
Services. Modernizing and
Clarifying the Physician Self-Referral
Regulations. Federal Register.
December 2, 2020. https://
www.federalregister.gov/documents/2020/12/02/2020-26140/
medicare-program-modernizing-andclarifying-the-physician-self-referralregulations.
Department
of Health and Human
Services. Medicare and state health
care programs: Fraud and abuse;
revisions to safe harbors under the
anti-kickback statute, and civil
monetary penalty rules regarding
beneficiary inducements. Federal
Register. December 2, 2020.
https://www.federalregister.gov/
documents/2020/12/02/
2020-26072/medicare-and-statehealth-care-programs-fraud-andabuse-revisions-to-safe-harborsunder-the.
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Manager | Nov/Dec 2021
15

https://www.faegredrinker.com/en/insights/publications/2020/12/new-stark-exceptions-mark-shift-to-value-based-care https://www.federalregister.gov/documents/2020/12/02/2020-26140/medicare-program-modernizing-and-clarifying-the-physician-self-referral-regulations https://www.federalregister.gov/ documents/2020/12/02/ 2020-26072/medicare-and-state-health-care-programs-fraud-and-abuse-revisions-to-safe-harbors-under-the https://www.faegredrinker.com/en/insights/publications/2020/12/new-stark-exceptions-mark-shift-to-value-based-care http://www.ormanager.com

OR Manager November/December 2021

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