Lebanon
D-H Chief Executive Officer James Weinstein and other health system leaders are seeking revenue hikes and expense cuts that would produce a $100 million “improvement” in the current fiscal year. They have estimated that will require laying off anywhere from 270 to 460 employees, and also have begun a review of clinical programs throughout a health system that includes Mary Hitchcock Memorial Hospital in Lebanon and clinics in New Hampshire and Vermont.
D-H leaders have promised to release detailed plans, including job cuts, by mid-October. The goal is to close a budget hole that opened with the last-minute discovery of a $23 million deficit for the quarter that ended June 30.
Among the measures being prepared for presentation to trustees at meetings which began on Thursday and continue today were steps to increase the productivity of D-H’s primary care doctors in the Lebanon area, according to information provided to the Valley News.
Those doctors have been expected to play a pivotal role in D-H’s high-profile efforts to change the way health care gets delivered and paid for. In recent years, they have generally not faced pressure to work faster, according to several physicians interviewed. Doctors and other employees from D-H who provided information for this story requested anonymity so as to not adversely affect their employment relationship.
Now, as part of efforts to balance the books, D-H may look to primary care practices in the Lebanon area to cut costs and boost revenue by raising “physician productivity,” redeploying workers and cutting programs, according to a 17-page presentation labeled “2017 Financial Improvement Plan,” which the Valley News obtained.
The new emphasis on productivity seemed to come “sort of out of the blue,” according to one primary-care doctor.
Physician productivity measures under consideration include changing scheduling practices so that doctors see 2.2 patients per hour, and reviewing the work performance of doctors who score low on a national productivity scale that Medicare uses to assess and pay doctors, according to the plan. No estimate of the revenue or cost impact is given.
D-H officials declined to comment on the plan.
“Our plan is still in development,” spokesman Rick Adams said in emails. “It will be multi-faceted, focusing on both improving revenues and reducing expenses, and we will employ a number of approaches to achieve these aims.”
Adams also declined to respond to questions about the specifics of the plan.
“As we develop our plans, we will communicate them directly to our colleagues across the Dartmouth-Hitchcock system,” he said.
Primary care doctors from inside and outside the D-H system and another D-H employee confirmed that the presentation had been sent to primary care clinics on Heater Road and elsewhere in the Upper Valley.
The mailing elaborates on some of the plans under consideration throughout the D-H system. It mentions “targeted cuts” in human resources, finance and other “support areas.” It calls for $8 million in savings on supplies. It identifies as “possible” a $5 million boost to revenue by reducing “leakage” — primary care doctors’ referral of patients to outside specialists rather than to D-H’s own specialists.
The plan also calls for shorter orientation periods for experienced nurses in new jobs, a reduction in the use of traveling nurses to fill vacancies, expanded use of medical assistants and “coding improvement” in all areas. Codes are used to assign prices to particular services.
The focus on measuring the pace and productivity of primary care doctors is new, according to the physicians interviewed.
“Benchmarks (have) not been our focus over the past few years,” according to an email sent out with the plan.
Primary care doctors, who specialize in internal or family medicine or pediatrics, play an important role in health care. They anchor and direct patients in a complex system. They make decisions and referrals critical to allocating care and managing spending. And while their segment of care may, at best, be only marginally profitable, they direct patients to departments that sometimes provide high-margin services critical to hospital economics.
That led D-H to pay less attention to primary care doctor productivity with the thought that their overall contributions to reducing costs would more than offset the foregone revenue, doctors said.
Productivity measures will need to be in place soon, the email says: “By year’s end (2016), we need to have made a noticeable contribution and be moving forward with increased productivity and expense reduction.” The phrase “noticeable contribution” is underlined.
Some steps seem fairly simple. Doctors will be expected to see 2.2 patients per hour, the plan says. New “scheduling templates” will be developed to achieve the new rate and account for no-shows and cancelations, according to the plan.
That approach to scheduling is similar to the overbooking done by airlines to ensure flights are full, according to a D-H employee familiar with scheduling protocols.
Other elements of the plan are more complex, with a focus on “RVUs,” or relative valuation units, which are used by Medicare to set payments for physician services, according to a summary by the National Health Policy Forum at George Washington University. They “account for the time, technical skill and effort, mental effort and judgment, and stress to provide a service,” according to the summary.
Doctors whose productivity is in the lowest 30th percentile would be subject to “individual improvement plans” overseen by primary care leaders, according to the plan.
Doctors whose productivity measures fall in the lowest 15 percentile of a national survey would require “justification” to maintain their positions, the emailed presentation states. Lora Council, D-H’s senior vice president for the primary care service line, will “determine actions to be taken” in those situations, the plan states.
The plan also calls for a halt in hiring providers until RVU benchmarks are attained.
One D-H employee said that John Birkmeyer, D-H’s chief academic officer, met with primary care providers last week and assured them that no one would lose their job because of low productivity, as measured by RVUs.
Adams declined to comment on that matter.
While the physicians interviewed did not view the 2.2 patient per hour benchmark as onerous, the approach does represent a change from the current regimen where, according to someone familiar with practices in the clinics, primary care doctors are now free to spend 30 to 60 minutes with some patients.
That made sense in the context of the new payment systems D-H has sought to build. With payment reform, it was hoped that revenue would no longer depend on the volume of services provided.
Primary care doctors were expected to play an important role in making the new system viable.
“The value of primary care is that you know your patient,” one doctor said. In turn, primary care doctors were expected to use that knowledge to lower costs by sending patients only for necessary care.
The new plan, with its focus on productivity measures, reflects “a new reality and it is a big adjustment,” that doctor said.
The proposed productivity measures would return to a traditional model where revenue gets generated only “when we’re face to face with a patient,” a primary care doctor said.
That means that care given when medical issues are identified and addressed remotely, such as through the MyDH portal, would not generate revenue, that doctor said. In addition, that doctor said, hours spent giving care in that form could lower a physician’s productivity score.
The renewed focus on productivity could present challenges, one doctor said. Among primary care doctors there is “a large amount of frustration that people were going one direction and then they’re being evaluated under a measure they were not focused on,” that doctor said.
There is also a concern about which scale D-H will use: one that surveys all primary care doctors nationally, or one that measures work at academic medical centers like D-H where productivity can be reduced by teaching, research and other responsibilities, one doctor said.
But the doctors interviewed, while not pleased, said they understood the need to make changes to address D-H’s financial problems, even it meant a slowdown in the systems reform efforts.
“We’ve got to take care of people and the organization,” one doctor said. “The organization has a beautiful vision but the world is not there yet.”
The commitment to reform ended up putting D-H in a bind, according to another doctor.
“Dartmouth was trying to change the game a little bit,” that doctor said. “Ultimately, the game didn’t change.”
Rick Jurgens can be reached at rjurgens@vnews.com or 603-727-3229.