Current definition of provider productivity and expected changes
The community health systems may have problems with the reduction in supply of health care providers especially physicians (Zismer & Werner, 2012). This may lead to an increase in the price of hiring physicians and other providers resulting in a decrease in the revenue made by the community health units, (this is similar to what is provided by the law of supply).
Changes in physician work in the new reimbursement model
- The new model will lead to incorporation of independent physicians and other practitioners into the community health system (Zismer & Werner, 2012).
- Integration of most physicians will reduce the level of competition within the health system.
- The work of the physicians may also be expanded; 49 out of every 100 members in the board membership of community health systems will be physicians (Zismer & Werner, 2012).
- The roles of chief executive officers will be taken up by physicians.
Best forms of provider compensation
In the past, physicians used various means to direct hospital funds to themselves. This method have proved to be ineffective over time.
Past models used have emphasized on the need for productivity driven methods of compensation such as: payment for service rendered. The recent models propose a salary compensation mechanism as the most ideal way of compensation ( Zismer & Werner, 2012).
The new model will lead to incorporation of independent physicians and other practitioners into the community health system (Zismer & Werner, 2012). A study conducted among cardiologists showed that a change in the model of health will see up to 75 out of every 100 private practice cardiologists join the community health system (Zismer & Werner, 2012).Integration of most physicians in the system will reduce the level of competition within the health system as all their efforts will be directed towards achieving organizational goals rather than competing among themselves.
The independent physicians who were previously competitive may be required to focus their attention on achievement of the organizational goals and working as a team.
The work of the physicians may also be expanded to include governance; 49 out of every 100 members of the board membership of community health systems will be physicians (Zismer & Werner, 2012), while the roles of chief executive officers will also be taken up by physicians as they are already involved in governance at the board. They may also work as co-managers allowing them to provide leadership across many disciplines. This will increase their knowledge base and functional abilities. The roles of those in leadership positions may also increase as they will be involved in studying the new model, comparing it with the old model and allocating resources to accommodate the changes. They may also be required to guide the rest of the people through the changes.
In the past, physicians used various means to direct hospital funds to themselves. This includes payment of on-call services, agreements for managerial services that they provided hand in hand with the physician services, salary agreements (Zismer & Werner, 2012).
This method have proved to be ineffective over time since the past models used have emphasized on the need for productivity driven methods of compensation such as the payment for service rendered requiring that a physician is compensated for the number or amount of services that he or she administers. This method was thought to be ideal as the number of units produced by a physician during a specified period of time could be predicted.
The recent models propose a salary compensation mechanism as the most ideal way of compensation ( Zismer & Werner, 2012). In addition to the salaries, incentive bonuses may be given based on the achievements and the rate of consumption of resources.
Assuring strong balance between provider financial security and productivity
The past reimbursement models that are in use at the moment pay physicians for services rendered.
This in itself makes them work hard since they needed to produce more in order to earn more.
The current model suggests a salary based method.
This may not be ideal in ensuring that there is a strong relationship between financial security of the provider and productivity ( Zismer & Werner, 2012).
In addition, the new method proposes incentive bonuses that may be given depending on the achievements and use of resources.
These new methods may be perfect for ensuring that there is a strong relationship between what the producer earns and their productivity in order that one takes home more money in form of bonuses they may have for working hard and to regulate how they use resources. The use of various resources in the hospital is dependent on physicians. They should take responsibility for the resources as this will ensure that only necessary tests are done. Thus, increasing revenues of the hospitals. The giving of bonuses will ensure that there is no loss of referrals from within the system to outside. This was specifically a problem in the old model.
Implications for Physician leadership or leadership model
The system will require the leaders to do things differently in almost all aspects of the organization such as; finances, resource allocation and hiring of human resources (Zismer & Werner, 2012).
- They will be required to know the difference between this model and that of the past in order to know how they will effect the changes.
- They may be required to allocate resources differently and to support those under them.
- The system under the new model becomes a closed portfolio.
- All individuals within the system will be required to meet the goals of the organization.
- Referrals will be limited within the system.
Physician Leadership will lead to creation of systems portfolios which are the services provided within the system that will be dependent on the requirements of the people accessing the services (Zismer & Werner, 2012), hiring specialty services will be dependent on the demand for those specific services. The model has various parts and thus for it to be effective the leaders have to implement all that it offers. Leaders also have to use the managerial principles provided together with the model.
The leaders have to be ready to be more involved in the decision making process as they will be included in the board of directors of community health systems and may even be given positions of the chief executive officers. A new model enhances the knowledge and abilities of the leaders in management and prepares them for future bigger tasks (Zismer & Werner, 2012). Referrals will be limited within the system unlike in the previous model where referral outside were common because most physicians liked referring patients to their friends which led to loosing many referrals.
Reference
Zismer, K. D. & Werner, J. M. (2012). Managing the Physics of the Economics of Intergrated Health Care. New York, NY: PEJ.