Marcum Industry Spotlight: Alice G. Gosfield, Esq.
MARCUM: What do you see as the government’s focus for the rest of 2019 and 2020 in physician related fraud issues?
A: I can’t tell you that I believe that in the current environment there are very clear paths. I think that one of my concerns, and I think that we have yet to see how it would play itself out, is that the government in its regulatory role has taken to regulating by FAQ and articles. They don’t publish formal regulations. That said, I think it makes it harder for them to bring false claims cases. The data pretty much shows that the government doesn’t so much have its own coherent approach, but it has been for the last good number of years responsive to the whistle blower environment. I think that whistleblowers are more of a problem than the government itself with regard to where problems are going to come from. So I would say my concern would be far more from a whistleblower point of view than from the government itself.
MARCUM: Ok I like that. So next question; There has been a near avalanche of physician practices being acquired by health care systems [A: Sadly yes] do you see that continuing over the next year or two?
A: I do see it continuing over the next year or two but I think it’s all based on mutual delusion. The physicians think they’re getting financial security – which they will not. The vigor with which the hospital world has fought against the elimination of the site of service differential (where the hospital gets paid at least a third and sometimes well more than that for exactly the same thing that physicians are doing in their offices), has supported and bolstered some of the idiotic compensation arrangements that hospitals have entered into with physicians that are really fundamentally not sustainable over the long haul.
MARCUM: Right. So here’s the next one: Private equity firms have started getting heavily into physician practices and urgent care centers. Do you see these as the future of the practice in some specialties and, if you think yes, which specialties?
A: I’ve seen a number of these deals and there’s a fundamental fallacy in the private equity deals that the physicians somehow manage not to appreciate when they’re looking at the dollars private equity says they’re going to spend on the assets. The goal of private equity is to get taken out by a bigger fish and them moving on to another thing. So that the physicians who are getting in bed with private equity are depending on the company, 5 to 7 years later going to be in bed with somebody bigger or harder to deal with and they won’t even know who it is. The values of private equity work at cross purposes with the clinical values that most physicians bring to bear in the way they do their work. It works better for the specialties that are more monetized; so it works better in dermatology where there’s a lot of cash. I have recent experience with a large OBGYN practice. My impression – I don’t represent any of the people who are in bed with private equity now, but my impression is from the scuttlebutt that it’s not going well. The investors generally know nothing about managing practices; and they certainly don’t know anything about billing effectively. But again I think that some specialties – plastic surgery, dermatology, that have more cash going on, are less fettered by the clinical demand of the PE environment. They don’t know anything about quality, that’s not their business.
MARCUM: You know about EMR systems I think. They’ve been touted as the best thing since the stethoscope and may be the biggest waste of time in medicine at the same time. What do you see as the ability of the EMR systems to make the impact they’ve been designed for, and can physicians ever get to the point where they use their EMRs to practice better medicine?
A: Yes they can. But it’s not coming from the big commercial Epics™ and e-clinical works™ and those kind of guys. There are now stories – that we’re actually going to post on our website, stories of settlements that these companies have had to pay, for failure of their programs to do a variety of things such as allocate incentive payments. But I will tell you I have a client, who is an oncologist. Unlike most of the oncologists in the country who take the drug money that they get from buying from big pharma at a discount and selling to payers at an inflated fee schedule rate, he took his money and put it into designing a wraparound package to – (I think he was using Mosaiq™) that has improved their ability to manage quality and improve their results and their expenses significantly, I mean really significantly. So can it be done? Yes, but you have to have an EHR designed by clinicians and not engineers.
MARCUM: So the payment system for services, using the CPT coding system has been around probably as long as you and I. Do you see the payment system going to outcomes based or total treatment of a patient as a viable alternative, and what would it take to make that breakthrough?
A: As you may or may not know I’ve spent 13 of my life, and relatively recently, involved in the design and implementation of the new payment model called PROMETHEUS Payment™. The name PROMETHEUS is an acronym, that I came up with, which is Provider Payment Reform for Outcomes Margins Evidence Transparency Hassle Reduction Excellence Understandability and Sustainability. It was a bundled payment model that was different from all the other bundled payment models, (this is probably my major contribution to the whole undertaking) because the budgets were constructed based on what good clinical practice guidelines say that patients need to treat a condition. When we first were designing it, we thought it would be a prospectively paid bundle. Turns out people can’t handle that. And so as in all the models, that certainly the government has come up with, they pay in the ordinary course, on a fee for service basis, with some reconciliation against some pre-defined budget, at the end. Can it be done differently? It can. Somebody who is a good friend of mine, who was very high up in the major payer in this market, said to me after I had been banging on him for a few years about paying physicians for what the guidelines say they should do ‘but what about our legacy IT systems?’ That’s the problem; they have legacy IT systems. They are really only capable truly of paying claims. They can sell products and pay claims. If you change to some kind of outcome based approach, it completely alters the infrastructure that supports the way payment gets made. When we were working on the PROMETHEUS stuff, one of the things that we had to understand – because there was a software package that was created so that you could have all the different providers in a bundle get paid for their portion of the bundle without it having to land on one PHO or one ACO which is the typical way in which gets done, was everybody would get their own money. But before we could go through the process of designing that, we had to understand what it takes to get a claim paid. I’ll never forget the guy who came and did the presentation, showed us a slide that had 44 individual steps that had to go into the evaluation of a claim and the management of the claim – this is one claim for a service, in order for it to come out of the bottom with a correct clean claim paid to the provider. When you look at it you go ‘it’s a wonder any claim gets paid’. There’s so much investment in that back office aspect of the way payment is handled in this country that it’s a real barrier to innovation.
MARCUM: I couldn’t agree more. So here’s one for you to just take a softball and hit it where you want. If you woke up tomorrow and were the head of CMS, what would your first most important initiative be to make the Medicare system more effective and efficient?
A: [laughing]
MARCUM: I don’t know if that’s a dream or a nightmare for you.
A: No I’m thinking that there’s a fantasyland answer but the real answer would be my first step would be to resign the position.
MARCUM: [laughing]
A: I don’t want that job. I was really excited when Don Berwick went to CMS, and as innovative as he is and as epigrammatic and creative a thinker as he is, he had approximately zero impact on that bureaucracy. If you were to ask me fantasyland, what I think should go away, (they’re beginning to make very slight inroads in incentives). I like to think of the visit codes as the S&M codes. They waste an enormous amount of people’s time, and don’t do anything to enhance the quality of the care that’s delivered. It’s mostly done because, if you think about what happened when the physicians of the cognitive specialties complained about the fact that only the procedural specialties were getting increases in their money, CMS had to come up with a way to quantify the intellectual fire power that a physician brings to bear in performing a visit. The way they did that is by counting bullet points: you have to have a certain number of bullet points associated with various aspects of the care delivery, and that’s what would determine whether you had a level one or a level five. Now they’ve decided in 2021, we’re going to be in a world in which we will have three codes: there’s going to be a level one, then all the others will collect the three into one code, and then there’ll be a level five for something that’s really complex. Will it help? It would help a little, but I don’t think it’s going to revolutionize anything; but we’ll have to see. One of the oxymorons of thinking about getting to be paid differently, is that the notion that you would pay people more for doing what they ought to be doing in the first place is what all the pay for performance models and a lot of the value based payments are about. In a sense, I like the guidelines based payment models where the science is in the components, the price of each of the components goes into the budget. But the idea that at least you’re amassing a quantum of services that deliver unto a patient what science says the patient needs, I think has real potential. Physicians want to hear about it and love it. They say ‘wow there’s a software package that does that?’ We created it with PROMETHEUS but it’s hell on wheels getting payers to shift what they’re doing to adopt something like that.
