When is a group practice ready for Medicare risk contracting?

Healthcare Financial Management, May, 1998 by Gloria Gerrity

It is estimated that the senior citizen population will grow to more than 80 million by the year 2000, 97 million by 2010, and 115 million by 2015.(a) As the market shifts to support this growing population, senior citizens likely will have more alternatives to traditional Medicare from which to choose. Group practices need to prepare for the challenges that they will face from such alternatives - in particular, Medicare risk contracting.

Although the majority of senior citizens remain in traditional, fee-for-service Medicare plans, Medicare risk contracting has been increasing over the past two years. lt is important for group practices to learn what operational changes may be necessary to manage Medicare risk arrangements.

Successfully integrating Medicare risk arrangements into practice operations does not necessarily mean that existing Medicare fee-for-service operations need to be eliminated. Rather, factors that already are important for serving senior citizens should be enhanced. Three key factors that practices should consider when implementing an operational plan for Medicare risk contracting are providing care locally, educating support staff and patients, and making their facilities accessible to senior citizens.

Providing Care Locally

Surveys suggest that senior citizens do not want to travel long distances for primary care and that they prefer going to smaller, more personal locations with a low employee turnover rate and a patient, friendly, and caring staff. Community-based services provided by a team of primary care physicians work most effectively for senior citizens.

In addition, by offering senior citizens specialty care in the community, a group practice will be more likely to attract and retain this patient group while enhancing clinical care. Analyzing marketplace demographics will help practices identify where the largest concentration of Medicare beneficiaries resides and help practices locate offices properly to provide these beneficiaries easy access to care.

Additionally, providing care locally can be accomplished by partnering with community-based healthcare programs or area agency on aging programs. The former agencies typically are Federally and/or state-funded, not-for-profit, or public group practices that may be known locally as a "free clinic" or "health clinic." Entrepreneurial agencies such as these are planning or have implemented activities designed to expand their Medicare risk contracting and may wish to partner with practices for services, such as licensed nurse practitioners.

Typically, an area agency on aging is a state-funded program for day services, such as meals and crafts. Often, such agencies provide ambulatory senior citizens with opportunities to socialize. By partnering with these agencies, practices have captured an audience to which they can provide on-site health care.

Educating Support Staff and Patients

Educating support staff and patients is a key success factor for managing Medicare risk contracts. The costs of educating staff and patients should be small, yet the return over time will be favorable.

Support staff. It is essential that support staff understand the importance of securing and retaining a stable patient base to avoid the administrative costs and loss of market share associated with patients switching primary care sites.

Receptionists and nurses, as the key contact people for patients, should be trained to understand and empathize with senior citizens to improve care delivered and boost patient retention. Their training should include learning about the clinical and business concepts behind Medicare managed care, the healthcare needs of senior citizens, theories about aging, physiological changes that occur with aging, and how to identify high-risk patients.

Training should stress the effects of aging, such as how the loss of vision, hearing, and mobility affects their senior citizen patients' daily activities. Staff should be able to identify high-risk patients by assessing their health status to identify functional disabilities and signs of malnutrition or dementia. The extent of their support system also should be identified. For example, Medicare patients without an identifiable support system are more likely to be hospitalized than Medicare patients with a strong support system.

Patient education. Patient education is essential in managing risk. All new patients who select a Medicare risk plan should receive instruction on how to use an HMO (eg, preauthorization and referral requirements) and how to receive after-hours care and emergency care. Patients also should receive initial health risk and nutritional assessments and education.

Making Facilities Accessible to Senior Citizens

Group practices should ensure that their facilities are designed or modified to facilitate use by senior citizens. A facility's overall physical layout should minimize the distance patients have to walk. The facility should be wheelchair accessible both inside and outside. Adequate seating should be provided for caregivers who accompany patients. Signs should be clear, easy to understand, and have large, easy-to-read lettering, and hallways should have hand railings and chairs. Elevators with "open" buttons but no "close" buttons may reduce the likelihood that an elevator door will close precipitously on a frail person.