PRODUCTIVITY METRICS USED IN HOSPITAL FUNDING AGREEMENTS

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PRODUCTIVITY METRICS USED IN HOSPITAL FUNDING
AGREEMENTS
2006 ACE Annual MeetingLas Vegas, NevadaSunday,
February 19, 2006 Speaker Anthony J. Trimarchi
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What is a Hospital Funding Agreement?

• Business decision that requires hospital funding
  of a physician practice (or department) to
  advance organizational goals.
• Examples Include
• recruitment start-up funding
• joint ventures
• deficit funding of mission critical programs

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Examples Used

• MEDICAL ONCOLOGY - 2002
• projected clinical growth
• perceived physician access issues
• clinical integration
• existing deficit
• RADIATION ONCOLOGY - 2005
• strategic planning
• physician retention
• equipment/capital needs assessment
• program location

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Why Review Physician Productivity?

• Most valuable resource
• Accountability to business enterprise
• Recruitment decisions
• Identification of other factors
• inefficiencies
• staffing

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Physician Buy-In

• CLINICAL PRODUCTIVITY REVIEW COMMITTEE -comprised
  of physician leadership, administrator and
  project staff
• review current productivity levels individual
  and aggregate WRVUs (from billing system)
• determine national standards for similar
  practices as a benchmark
• develop WRVU based goals/targets that support
  financial and service needs

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Clinical Full Time Equivalents

• HOW DO PHYSICIANS SPEND THEIR TIME?
• Clinical
• Teaching
• Research
• Administrative
• Other
• IDENTIFY UNFUNDED/UNDER FUNDED WORK
• Negotiate funding or change behavior
• CLINICAL FTES
• Interview physicians
• Drill down clinical schedules
• Based on time available for clinic, not funding
  sources

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CFTE Example
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Benchmark Selection
In both cases, it was believed that industry
benchmarks (MGMA, UHC, SROA) fell short of the
needs of the organization

• MEDICAL ONCOLOGY review committee recognized
  the lack of comparable data as an early obstacle.
• RADIATION ONCOLOGY required a better fit with
  similar institutions than the industry surveys
  provided due to low survey participation.

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Solution

• MEDICAL ONCOLOGY Hired a consultant to survey
  the National Comprehensive Cancer Network (NCCN)
  centers. Conducted site visits to 2 comparable
  cancer centers to observe operational and
  staffing efficiencies.
• RADIATION ONCOLOGY Designed a survey (modeled
  after the 2003 SROA tool) with participation from
  4 similar organizations. Survey questions
  covered
• specialized services
• staffing and operational structure
• equipment
• patient/treatment volumes

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Radiation Oncology PhysicianProductivity
Benchmarks
Median Academic Practice Work Relative Value
Units Per Clinical FTE Physician

• MGMA 8,239
• UHC 9,011
• UW Survey 8,089
• UW Performance 9,436

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Other Radiation OncologyBenchmark Examples

• Medical physicists per accelerator
• Number of patients per nursing FTE
• Tx plans per dosimetrist
• Beam treatments per therapist
• Support staff per CFTE physician
• Annual Tx requiring anesthesia
• Annual seed implants
• HDR Tx by sub-specialty
• Levels of hospital support

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Radiation Oncology Results

• PHYSICIANS
• Set physician productivity benchmark at 8,089
  WRVUs per CFTE.
• Validated the need to recruit additional
  physicians.
• Built benchmarks into funding agreement.
• Used benchmarks to determine future recruitment
  needs.
• OTHER
• Validated that physicist, dosimetrist, nursing
  and support staffing levels were acceptable at
  current productivity levels when compared to
  comparable institutions.
• Cited several facility/equipment issues that
  would need to be addressed.

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Example Radiation Oncology Recruitment Agreement
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Medical Oncology

• 2002 MGMA Median 2,854
• 2002 NCCN Median 3,251
• UW Performance Level 2,825

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Benchmark Selection Criteria

• Recognition that a legitimate funding gap
  existed.
• Benchmark performance would be expected in order
  to justify future support.
• Would take into consideration the significant
  research and teaching effort of faculty.
• Group vs. individual performance measure.
• Benchmark would become a component of incentive
  program.

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Individual Benchmarks Basedon Percentage
Research and Teaching (RT)

• Adopted NCCN median as benchmark, and established
• goals that reflect research and teaching effort
  as follows
• LOW 35 RT 2,167 Goal
• MODERATE 45 RT 1,799 Goal
• HIGH 55 RT 1,439 Goal

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Funding Agreement Principles

• WRVU Goal Met 100 Shortfall Funding
• salary metrics (AAMC)
• department overhead rate cap
• WRVU Goal Not Met
• funding up to level had goal been met
• imputed revenue based on historic collections per
  WRVU
• remainder of shortfall shared
• 2/3 hospitals
• 1/3 department

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Example Medical Oncology Funding Agreement
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Medical Oncology Results

• Validated assumptions regarding physician
  shortages and initiated recruitment activity.
• Set baseline WRVU targets that took into
  consideration research productivity.
• Utilized aggregate measures to establish
  financial support agreements.
• Established systems to enhance internal data
  collection needed to track productivity
  accurately.
• Regular reporting to faculty on performance.
• Adopted several clinic operational improvement
  and staffing strategies.

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Lessons Learned

• Physician buy-in essential
• Industry benchmarks not perfect
• Get creative with benchmarks
• incentive plans
• staffing levels
• funding agreements
• other

EASIER TO WORK WITH OUR HOSPITAL PARTNERS!