Susanne Madden

When was the last time you reviewed your partnership agreement? Even if you are not currently contemplating new shareholders or partners, if you haven’t looked at your agreement in the last three or more years, now may be the time. 

Market forces have changed significantly over the last several years, and the partnership agreement you signed in the past may not cover issues like reduced responsibilities to accommodate work-life balance, retiring partners, or how to manage to value- or performance-based contracting in which one partner’s performance can determine if any performance payments get paid to the group at all.

From the perspective of business operations, let’s break out some of the key questions that you should consider in every partnership agreement:

Does the current agreement outline how you will add new partners or shareholders? Is there a buy-in? If so, will that be in the form of financial or sweat equity? Will the buy-in amount or term change (e.g., if it is practice value)? Has a method been determined for assessing that value and has it been incorporated into the agreement?

Will all partners carry equal responsibility and be expected to dedicate equal time to administrative and clinical duties?  Or is there one 'managing partner,' or even a Board of Directors? If so, how are those partners compensated differently? 

How will you address one partner stepping back from their obligations for reasons such as health or family issues or upcoming retirement? Are there clear terms defined to accommodate that, either in the form of reduced compensation or even the ability to hold onto partnership status?

How will profits be shared? Will they be distributed equally or will there be a productivity component involved? What model will you use to determine that? (e.g., relative value units, revenues brought in, etc.) How might that model change over time?

More and more often, we see payer contracts that have ‘value- or performance-based’ components attached to compensation. How will these group-based payments be distributed? Are there penalties to individuals that fail to meet targets, which may put substantial sums at risk for the group as a whole?

Is each partner responsible for their coding and documentation? In the event of an insurance audit that results in ‘take backs,, is the group liable for an individual’s errors?

How will disputes be rectified? For example, if one partner wants to expand or invest but the other does not, how will that be resolved? What happens if you simply can’t get along with a partner anymore-do you have the right to force them out? If so, is there a premium allocation to be paid to that partner in the event of this situation?

Does the agreement designate how far in advance a partner wishing to leave the group must notify the other members? For example, retirement notice should given be at least 18-36 months ahead of time, and it may be prudent to consider that shorter notification periods could result in forfeiture of part of the buy out.

Do the senior partners retain voting rights while more junior owners remain non-voting shareholders?

Addressing your agreements from these angles will not only help you cover your bases in the event of unforeseen circumstances, it also ensures that you are providing the best ongoing governance of your practice for many years to come

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Nine areas that every partnership agreement should consider.

Partnership agreements: Why it may be time for an overhaul

Bundled payments have been around for quite some time. From ‘global’ payments for deliveries to bundling of same-day multiple procedures to episode-based payment models under CMS’ Bundled Payments for Care Improvement (BPCI) Initiative, hospitals and specialists alike have had some sort of exposure to the concept of ‘bundling’. 

More recently, we’ve seen more and more commercial plans looking to the outpatient specialty market to apply the same methodologies. We are now seeing bundling episodes for gastroenterologists, orthopedists, and oncologists. Some of these programs are very straightforward, with the goal being to manage simple procedures, such as colonoscopies, in the most cost-effective way possible. 

Typically, a plan will approach bundling in one of two ways:

The plan may determine the average cost for these services within a geographic region and offer a bundled rate consistent with that

The plan may look at the range of cost associated with a particular practice delivering a service and offer a bundled rate at the midpoint (or elsewhere on the cost spectrum). 

The goal is to bring services that are being delivered at a higher cost in line with less expensive approaches. 

For example, a gastroenterologist may perform colonoscopies at three different ambulatory surgery centers and two hospitals. The cost may vary greatly between places of service. By setting a bundled rate, the physician has to control the resources utilized in order to bring that total cost of care below the budget target to share in the cost savings. Most of these arrangements are ‘upside only’ risk, meaning the physicians get paid as fee-for-service, then a retrospective review of the costs of these episodes are undertaken to determine if the practice came in above or below the budgeted target. Any savings are shared, but if costs exceed the budget, the practice is not penalized for those excesses under most current contracts. However, as these arrangements mature, we expect to see more ‘downside’ risk coming in the future.

While colonoscopies are easily to measure and manage due to the limited number of components involved and relatively rare occurrences of complications, it is infinitely more difficult to manage, say, oncology episodes. But where there is more complexity, there is more opportunity for greater savings.

So, how should practices manage opportunities for bundled episodes of care? 

First, control as much of the cost as possible. 

For example, gastroenterologists that that own ambulatory surgery centers, employ anesthesiologists, and have their own labs are in a much better position to control costs than those utilizing hospital-based places of service, out-of-network anesthesiologists, and external labs.  If you fall into the latter group, sharing the risk with a hospital partner may make sense, and choosing to work with in-network resources can help mitigate risk. 

Second, effectively manage and coordinate patient care. 

Implementing pre- and post-operative processes that help to manage every facet of patient care can ensure minimization of adverse events and keep costs tightly contained. That may not always be so easy to do-particularly when more complicated procedures are involved, or when there is greater involvement across multiple providers (which is the case for oncology). In those cases, implementing care management systems is essential to understand how costs are trending for any given patient’s continuum of care during an episode. Some plans offer assistance with that management (for example, Aetna’s multidisciplinary care teams work directly with patients), but controlling care at the practice level is ultimately the best way to manage your patients’ care. 

 utilize a range of interconnected data to track the care that any particular patient receives across a care episode. Pulling together data coming in from hospital systems, specialists, and other third parties, a patient’s care is tracked along the episode timeline. Pre-built algorithms based on bundled budgets help to forecast costs in near-real time, enabling practices to get in front of any potentially adverse and costly trends before those budgets are blown. 

To ensure the highest quality of care is being delivered across every aspect of delivery, it is essential to monitor physician performance and act upon that data. Many of these bundled arrangements have quality metrics associated with them. For example, Horizon Blue Cross Blue Shield (NJ) and United Healthcare both have components in their colonoscopy bundles for cecal intubation rates and adenoma detection rates that must be above certain thresholds in order for upside cost savings to occur.

As these programs mature, expect to see greater sophistication of care management technology being presented to help manage that care and greater consolidation of services across healthcare providers-whether in the form of clinically integrated networks, super-groups, accountable care organizations, or other models-becoming more prevalent. Partnering with effective vendors, health plans, and self-funded employers will be key for practices wanting to successfully implement bundled arrangements in the future.

Three ways medical practices can manage opportunities for bundled episodes of care.

Mitigating risk on outpatient bundled payment contracts 

It’s Monday morning. Your phones are ringing off the hook, patients are getting squeezed into the schedule any place your staff can find, and it’s looking like it’s going to be another exhausting day. 

But does it really have to be like this? 

Busy offices rarely have the time to pause, evaluate workflows, and attempt to improve efficiencies across the practice. However, unless you make that time, things are likely to stay the same and you’ll repeat those exhausting Mondays over and over. 

First, start with the most obvious issues. For example, figure out what is the single, most recurring annoyance in your practice. Is it being over-scheduled? Patients not getting timely callbacks? The same questions coming up time and again from patients? Narrowing it down to an item or two that you’d like to improve is essential to making any progress at all. Try to do too much at once and you will likely fail, as time is limited and more pressing obligations will always keep popping up. 

Second, put together a small team of people to work on the problem and set aside 30 to 45 minutes a week to work on it. Tapping into those on the ‘front lines’ of the issue often reveals quick solutions. Staff usually know what needs to be fixed and how to fix it, but either haven’t been empowered to fix themselves or simply haven’t had the time to focus on implementing the solution. 

Third, make sure that you are solving the right problem by digging in to the root cause of the issue. I find that working with the ‘

 diagram is very effective at 1) getting to the underlying cause of a problem, and 2) working through how to implement a solution. 

A variety of process improvement tools can assist you in any area of process improvement: from the more complex 

 tool–but the best process improvement projects are usually those where the easiest process for 

team is used, and they can hone their improvement skills over time from there.   

Once you’ve established the problem, its cause, and how you can change it, you need to implement those changes in your practice. 

Start by drafting a staff memo that accomplishes two things: 1) it ensures that your new process gets captured and disseminated to the staff, and 2) it can be used as part of your training materials going forward. As you perfect more and more processes, that library of literature will grow. 

The memo should lay out a few components. It should identify the nature of the problem, quantify why it’s a problem, and state exactly what the team has proposed as the solution. Then ask that everyone to support the change, andlet them know that you will be measuring the outcome. 

Don’t expect miracles overnight. Staff need time to get used to a process change, particularly if it changes the flow of what they do. The key to ensuring that changes will stick is to measure the progress and reinforce the new process any place that you find it is not being implemented routinely. Staff need to practice the new way of carrying out a task, and reinforcement is what gets them there. 

And don’t forget–always go with the easier changes first. Why? Because having some early ‘wins’ will allow staff to feel confident in deploying new processes, and over time the process of continuous improvement itself can become part of the practice culture. If you try to do too much, too soon, your staff may become overwhelmed and everyone will fail in the endeavor. 

It really doesn’t matter whether the issue is administrative or clinical. Identifying a problem, working as a team enabled by process improvement tools to develop a solution, and moving toward implementation is bound to improve how your practice flows.  

Busy offices rarely have the time to pause, evaluate workflows, and attempt to improve efficiencies across the practice. However, unless you make that time, things are likely to stay the same.

Does your office flow?

Millennials have a completely different set of expectations than prior generations when it comes to engaging with the world around them. They are the digital natives and, as such, are used to interacting with their social networks, accessing services, and having the world’s knowledge all at their fingertips.

Healthcare spending represents 17.9 percent of America’s gross domestic product, but the healthcare industry is still in its digital infancy. Unlike most service industries, healthcare providers are still working with 1990s technology: the phone and the fax machine. While many practices have attractive websites, they haven’t invested in the 

Think about it: Millennials are used to booking flights, hotel rooms, hair appointments, and ordering takeout at any time of day or night from the convenience of their smartphones. But when it comes to making a doctor’s appointment, patients typically have to make a phone call during business hours and wait on hold for prolonged periods of time. Millennials expect good experiences when interacting with any service provider. A reasonably functioning website is not enough to create that experience. Primary care practices have to offer millennials access and convenience, too.

Generation Y trusts their social (and social media) networks far more than traditional advertising. They go to the internet first to research their symptoms, then call their doctor (or not). Millennials do not rely on physicians for medical advice as much as previous generations and prefer to do their own online research before booking an appointment. According to a 

56 percent of millennials reported they  visited a primary care physician in the last year, compared to 74 percent of non-millennials.

Approximately half of millennials research symptoms and treatments online before consulting a doctor, and of those, 27 percent will self-treat at home rather than consult or visit a physician’s office.

They not only consult the internet for healthcare advice, they’re also vocal about the care they receive. Sixty percent of young millennials will share their experiences when they are dissatisfied with their friends rather than with their doctors, so it is critical for physicians to solicit feedback from them directly. Giving them an opportunity to express their opinions verbally in the office can help prevent negative reviews online.

Millennials don’t just use the internet to google symptoms and self-treat. They use it to find the best doctors, and the best doctors for them personally. A survey conducted by 

 found that 54 percent of millennial responders use online reviews to find a doctor before scheduling an appointment. What’s more, they are twice as likely than non-millennials to trust personal and social network reviews when it comes to selecting healthcare providers.

Millennials expect that healthcare providers will understand their needs and support their preferences in much the same way as other service brands. Canned advice will not resonate the way that more personalized information addressing lifestyle, health, and happiness does.

 engages its patient community through several key strategies:

It hosts an user friendly website where information is quickly found through the use of icons and labels for popular content rather than presenting the viewer with lots of text to scan. The health system also actively solicits feedback to constantly improve the site.

It offers viewers a quick and easy way to sign up for a "healthy tips" newsletter that ties together the health aspects that millennials particularly care about, such as nutrition, mental health, and wellness.

It features videos with a personal touch: physicians talking about themselves, their practices, and the care they provide alongside patient testimonials. Northwestern encourages sharing of these videos on social media networks.

It houses an extensive library of medical advice, articles, and content making it a go-to consumer destination for good sources of medical information.

Of course, most primary care practices do not have the extensive marketing budget of Northwestern Medicine, but most can readily incorporate Northwestern’s marketing strategies to approach millennials.

5 initial steps to build your millennial marketing strategy

 in ways that will support a high-quality experience.

Become a go-to resource for health information. You can tap into readily available sources of information by interlinking trusted sources into your website, and/or you feature content from your own providers, such as blog posts or reviewed articles.

Use existing technology to its fullest potential. Start with your EHR vendor. Are there patient engagement tools available that you aren’t using such as text message reminders for upcoming appointments? Ability for patients to self-schedule? A portal for patients can access their medical records and securely communicate with the practice at any time? Technology doesn’t have to be expensive, and you may already have access to many digital tools you didn’t know about.

Engage millennials in their care. Setting aside enough time to develop relationships during initial visits can be an essential component of establishing a positive experience.

 from patients by asking them about opporunities for improvement, what services they would like to see from your practice, and if they would like to review your practice online, which can help you attract more millennials. This feedback can also help you to improve your marketing strategies over time to attract millennials and patients in other age brackets. These strategies will provide an ongoing source of information to continue improving and refining marketing strategies, and it may improve your ratings with payers, too.

It’s no surprise that the digital native generation has different communication and interaction preferences. Here are five ways primary care practices can engage millennial patients.

Author | Susanne Madden

Articles

Partnership agreements: Why it may be time for an overhaul

Mitigating risk on outpatient bundled payment contracts

Does your office flow?

How to market to millennials