Tough Medicine to Herd Surgeons Into “Pay-for-Performance”

Changing surgeon perceptions about their role in delivering healthcare in a post “fee-for-service” world poses great challenges.

According to a 2012 survey by Mayo Clinic researchers, only 7% of surveyed physicians expressed any enthusiasm for eliminating fee-for-service payment models. Penalizing clinicians for avoidable readmissions and adopting bundled payments received just 6% support. Some physicians don’t believe that “pay-for-performance” actually improves patient outcomes.

Tough Medicine for Change

How are leaders of healthcare systems going to change those attitudes and convince surgeons to get on board efforts to get costs under control and improve patient care?

Two leaders think they have the answer. First, appeal to a physician’s better angels. Second, reward them. Third, apply peer pressure. Fourth, shun them. If those four don’t work, fire them.

That’s tough medicine prescribed by Thomas H. Lee, M.D., chief medical officer at Press Ganey and former network president of Partners HealthCare and Toby Cosgrove, M.D., CEO of the Cleveland Clinic. The two offered that prescription in the June 2014 issue of the Harvard Business Review.

Radical Transformation

They write that health care regularly fails to deliver what its customers need. Individual physicians can no longer guarantee efficient, high quality care. The day of the lone superstar surgeon is gone. To serve customers and patients, Lee and Cosgrove argue a radical transformation moving from a system organized around individual physicians to a team-based approach will be required.

As evidenced by the 2012 Mayo survey, they recognize that many physicians are deeply anxious about the changes under way and are “mourning real or anticipated losses of autonomy, respect, and income. They are being told that they must accept new organizational structures, ways of working, payment models, and performance goals.” Physicians are, “moving at various rates through the stages of grief: A few are still in denial, but many are in the second stage—anger. Bursts of rage over relatively small issues are common.”

Simple incentives to win surgeon support aren’t going to cut it. They argue that healthcare leaders must develop an understanding of behavioral economics and social capital and be ready to “part company with clinicians who refuse to work with their colleagues to improve outcomes and efficiency.”

Framework for Action

They suggest a framework based on the writings of Max Weber, the 19th century German economist and sociologist who described four motivations that drive social action. They are:

1. Shared purpose
2. Self-interest
3. Respect
4. Tradition

To begin, Lee and Cosgrove say leaders have to let physicians know exactly what they want the physicians to be engaged with. They say hospitals have wanted physicians to be loyal, to refer most or all of their patients to them, to increase the hospital’s revenue. “Even today, many hospital administrators believe that their true ‘customers’ are the physicians who bring them patients and not the patients themselves.” The result is that working with physicians to reduce costs or improve quality is secondary to increasing volume.

But in a post fee-for-service world, physician engagement can no longer be simply about maximizing volume and revenue. “It must further the long-term strategy of improving outcomes and lowering costs and increasing value for patients.” The authors bemoan uncoordinated and insufficient piecemeal efforts like putting doctors in leadership roles and creating financial incentives for change behavior.

To get real results, the authors write that leaders need to tap into Weber’s four motivational levers.

Shared Purpose

Instead of dwelling on the problems of spiraling costs, lack of access and uneven quality, they say leaders must shift the conversation and “articulate a vision of what lies on the other side of the turmoil.” And most importantly, show how care for patients will be better and focus on something positive, noble and important.

The need for sacrifice must be acknowledged. “The journey will be arduous and might reduce autonomy and income for physicians.” Organizations will find it impossible to defend prioritizing the interests of doctors over patients.

Because half of physicians in the U.S. are not employees of the organization where they provide care, they don’t respond to the perks and threats managers typically use to influence behavior. And as the Mayo study showed, even those who are employed view their duty to patients, not the organization.

“That perspective can be a path to meaningful change, ” noting that during a crisis no physician worries about compensation or hours worked. They argue that using data to demonstrate how proposed changes can improve efficiency and patient outcomes.

Surgeons Control

That approach is central to influencing surgeon behavior at the National Orthopaedic and Spine Alliance (NOSA), made up of the CORE Institute, the Cleveland Clinic, the Rothmann Institute and OrthoCarolina.

David Jacofsky, M.D., the head of CORE (Center for Orthopaedic Research and Education) recently told attendees at the recent 11th Spine Technology and Educational Group symposium in Los Cabo, Mexico, that the organization has created standardized episode-based pathways around 27 orthopedic and spine procedures. Since the organization takes on financial risk by agreeing to take a bundled payment, NOSA has to make sure it is able to maintain margins, mitigate risks and minimize variability and variation in outcomes.

For example, if there is a lumbar fusion complication, there is a CORE app on a PDA (personal digital assistant) that puts that complication into their data warehouse in real-time. That becomes a data point in predicting what the 90-day costs would be for that lumbar fusion. As more complications are added, the cost goes up. When there are fewer complications, the cost goes down.

Jacofsky says he can show a surgeon the data that when that surgeon stopped using the standardized protocols, their complication rates immediately start to go up.

“The question is how do you define the guidelines? What do you do to make the guidelines surgeon-driven and decided by surgeons so that it’s not an insurance company that’s telling you this is the best way to do it? Ultimately there’s never been a single scientific trial utilizing evidenced-based standard order sets for any patient population regardless of complexity that hasn’t shown improved outcomes. Ever, ” continued Jacofsky.

He says relying on the data can result in avoiding overutilization and providing the right treatment. “Not necessarily how you perform the treatment, not whether or not you use an anterior plate or not, not whether you are using one company’s device over another. It’s about how do you manage patients in an evidenced-based way so that they receive the right treatment at the right time.”

Appealing to Self Interest

In addition to appealing to a surgeon’s better angels, Lee and Cosgrove remind us that like everyone else, physicians are motivated by financial incentives and job security. They write that physicians care intensely about what measures are being used to gauge their performance and how the data are collected and analyzed. “This natural self-interest can be channeled to reinforce engagement in a number of ways.”

For instance, some organizations make portions of physicians’ compensation dependent upon performance. Pennsylvania-based Geisinger Health System, for example, ties 20% of physicians’ potential compensation to their performance against certain goals or, in many cases, on how they do as a team.

Other organizations, like The Mayo Clinic, put physicians on straight salary, believing that all financial incentives can have unintended negative consequences and are an invitation to game the system. They note the Cleveland Clinic’s physicians are all salaried, without any performance based bonus program. “Instead of using overt financial incentives, the clinic hires all physicians on one year renewable contracts, and they undergo detailed annual performance reviews. The physicians see the yearly reviews not just as a chance to receive feedback but also as an opportunity to communicate with hospital leaders about how the organization could improve.”

Finally, they write, if physicians believe that a particular management-endorsed behavior or practice will improve patient care, even minimal financial incentives will be enough to help them implement it consistently. “If they are uncertain about whether it will actually improve care, even large incentives will produce only marginal success.”

Earning Respect

Lee and Cosgrove write that physicians particularly worry about losing the respect of their colleagues. “High performing organizations are increasingly reporting to physicians how their personal performance compares with that of their colleagues—and providing those data in ways that intensify peer pressure.”

They say that such scrutiny can be excruciating, especially when the data are “unmasked” so that colleagues can see one another’s results. They cite that within physician groups at Partners Healthcare System, for example, unmasked data on individual physicians’ use of radiology tests led to an almost immediate 10% to 15% drop in orders for high-cost tests, mainly due to decreases among the “outlier” physicians who ordered many more tests than their colleagues.

Some organizations go even further and now post individual physicians’ quality-performance data publicly on their websites. “Whether consumers are using these data to make decisions is unclear, but doctors, knowing that their performance is on public display, are strongly motivated to improve.”

At University of Utah Health Care, the authors report that leaders began sharing each physician’s patient-experience data with him or her confidentially. Next, they began sharing the data internally so that physicians could see one another’s ratings and patient comments. Finally, they began posting the data and comments—good and bad—for every physician on public websites. With each escalation in transparency, overall performance improved.

“One key to Utah’s success with the program, we believe, was its gradual introduction, which allowed physicians to acclimate at each step.”

Embracing Tradition

When physicians value memberships in an organization out of pride, a need for security, or some other reason, the authors say they are motivated to adhere to that organization’s standards and traditions.

For example, Mayo has standards for how its physicians communicate with one another (for instance, when paged, they must respond immediately) and how they interact with patients (before out-of-town patients with complex conditions are discharged, physicians must meet with them for “exit” visits to discuss their ongoing care and answer questions).

“Such standards create consistency—a basic step toward more-effective teamwork. Even newly minted standards, such as using checklists, can be effective motivators when physicians know that they could be shunned or even lose their jobs if they disregard them.”

Termination

If the four Max Weber described motivators that drive social action don’t work, then get rid of the physician. “Organizations must be willing to part company with physicians who refuse to work with their colleagues toward a shared purpose.”

Herding surgeons into the new pay-for-performance world will take time, demand evidence that patient care will be improved and allow surgeons to exercise control over their practice of medicine. Lee and Cosgrove’s tough medicine may bring results. Time will tell.