November 28, 2014

Payments: 'We Do Need Change'

Nurse-turned-lawyer Maria Currier sees a future of mergers, purchases and opportunities. Keep an eye on the quality of care.

Mike Vogel | 5/1/2010

payments

Maria Currier
“I think it’s an exciting time. We’re going to see a lot of new business models, opportunities. This is America. We’re going to find the solution, and there’s going to be a better system than we’ve got today.” says Maria Currier. [Photo: Daniel Portnoy]
Back in February — a healthcare debate lifetime ago — as Obamacare looked doomed, attorney Maria Currier described “where the action is” in the field: Change is coming for hospitals, doctors and other providers in how they get paid, and that’s going to change how healthcare is delivered and patient care is coordinated in America. Currier, 52, chair of Holland & Knight’s national healthcare and life sciences practice and a nurse by training, was more right than she knew. “It’s going to happen a lot faster than we thought,” she says.

Born in Cuba, Currier earned her bachelor’s in nursing at St. Louis University. She started her nursing career in Miami as an ER nurse at huge Jackson Memorial Hospital during the McDuffie riots in 1980. After getting her master’s at the University of Miami, she taught at the school of nursing there for two years, then entered law school and has been a corporate and healthcare lawyer in Miami since 1988 — with the exception of a three-year stint in Latin America heading up the office in Venezuela for a Miami firm from 1997-2000. She says she misses nursing occasionally. “The law sometimes is impersonal. I’m more of a people person.”

Currier says Congress accelerated the coming sea change in payment. Government will use its Walmart-like clout as a volume purchaser of healthcare services — through government insurance reimbursements — to change from the current “fee-for-service” system, which Currier says is dying, to patient-centered bundled payments aimed at increasing care coordination, which hopefully will better control costs. In that future, private and government insurers will determine the fair cost of treating a given medical condition and then pay once for care that spans across provider types — whether to a single enterprise or to contractually aligned doctors, hospitals and post-acute care givers — rather than reimbursing each provider separately. Need a hip replacement? An insurer might, for example, write a single check to the hospital, which would then distribute the money among the providers involved in the surgery, hospital, recovery and post-surgery care.

Current Payment System - Under the current system, insurers and patients pay each provider separately. Today, third-party payers — the government and insurance companies — make 85% of all payments going to healthcare providers, with patients accounting for 15% “out of pocket.”
Current Payment System

Bundled Payment Plan - With a bundled payment system, insurers and patients pay one provider, who then pays all the other caregivers.
Bundled Payment Plan

Clearly, new organizational structures will need to be developed, and the implementation of bundled payments will be complex. However, Medicare demonstration projects testing these innovative payments are finding they lead to less paperwork, lower costs, better care coordination and fewer readmissions to hospitals, she says. Joined to the new payment focus will be the concept of a “medical home” [“The Medical Home,”] and the coming of IT automation. “This decade is when we are going to modernize the health industry,” she says.

From those big themes flow consequences and business opportunities: Pressure on margins will lead to consolidation, outright acquisitions or contractual partnerships. The solo doc faces a tough road. And the government, which has spent years writing antitrust and anti-kickback laws in healthcare, now will have to rewrite rules to allow the financial alignment of various providers.

The trick is the details. Bruce Rueben, Florida Hospital Association president, agrees bundled payments have great potential to provide the best outcome at a predictable price. “The challenge comes in that you can’t predict everything a patient is going to need,” he says.

With bundled payments, issues will emerge involving questions like who’s on the financial hook if a patient needs a return trip to the hospital because he decides not to take his post-operative medication or falls because he ignored a prescribed exercise regimen. Others: Is the healthcare provider who got paid and divvied out the proceeds as liable for a medical error as the one who made the actual mistake? And won’t the financial disincentives for readmitting a patient sometimes lead a doctor to delay or refuse readmission?

Currier is an optimist but not naive. The issue for patients: “As we bring the hospital and physician together under one payment, I think the greatest challenge will be to ensure the quality of the care doesn’t suffer.”

The issue for the nation: “It is a whole new world now we’re embarking on. The most important part of this whole puzzle now is we’ve got to control the cost. If we don’t, this is going to be a huge problem for this country.”

Tags: Healthcare

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