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AMA Physician Benchmark Reports on Compensation Methods and on Prevalence of New Models of Care

Two 2014 Physician Practice Benchmark Survey reports have been released by the American Medical Association within the past few months. The first looks at compensation models used to pay physicians, and the second provides data on the prevalence of physician participation in accountable care organizations and medical homes and the use of alternative payment methods [capitation, pay-for-performance, bundled payments, or shared savings].

Here are some of the key findings from the reports:

  • For many physicians, compensation was a blend of different methods. Half of compensation for non-solo physicians came from salary, another third was productivity-based, 12% was based on practice financial performance, and 4% came from bonuses. The proportions varied when analyzed by type of practice and its ownership.
  • Fee-for-service is still the dominant payment method for physicians, although 59% of physicians said their practice received some revenue from an alternative payment method. An average 72% of practice revenue came from fee-for-service. Unsurprisingly, practices participating in a medical home or ACO received a larger proportion of their revenue from alternative payment methods.
  • In 2014, 24% of physicians worked in practices that were part of a medical home, and 29% reported working in a practice that was part of an ACO. Participation rates were higher in multi-specialty practices and lower in solo practices. Hospital-owned practices also had higher medical home and ACO participation rates.
  • In single specialty practices, participation in a medical home was lowest for surgery and its subspecialties and highest for family practice and pediatrics. However, ACO participation was highest for general surgery and family practice but low for pediatrics


Kane CK. Payment and delivery in 2014: the prevalence of new models reported by physicians. American Medical Association Policy Research Perspectives, Dec. 2015. http://www.ama-assn.org/ama/pub/advocacy/health-policy/policy-research.page – expand Medical Practice section to select report [free web site registration and login required to view/download]

Kane CK. How are physicians paid? A detailed look at the methods used to compensate physicians in different practice types and specialties. American Medical Association Policy Research Perspectives, Aug. 2015. http://www.ama-assn.org/ama/pub/advocacy/health-policy/policy-research.page – expand Medical Practice section to select report [free web site registration and login required to view/download]

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

Payment and Delivery System Reform in Medicare: a Primer on Medical Homes, Accountable Care Organizations, and Bundled Payments

In response to the Affordable Care Act, Medicare has been testing new payment models to improve patient care and control costs. A recent Kaiser Health Foundation report is a primer on three of these models — medical homes, accountable care organizations, and bundled payments:

  • Medical homes are team-based care models focused on primary care practices for delivery and coordination of patient care. The payment model typically provides a monthly management fee or other payment in addition to fee-for-service reimbursement.
  • ACOs are groups of physicians, hospitals, and other providers that collectively share accountability for the quality and cost of care delivered to patients in an ACO. Financial incentives involve shared savings or losses for ACO performance based on meeting quality and cost benchmarks.
  • Bundled payments focus on setting an episode of care budget for a particular clinical condition over a defined time period rather than paying separately for each delivered service. By better managing and coordinating care, providers can come in ‘under budget’.

Each payment model is discussed, including its goals, financial incentives, number of participants, potential implications for beneficiaries, and early results on quality and savings. Preliminary results from these models have been mixed and are summarized in the report.

Source: Basement S. and others. Payment and delivery system reform in Medicare: a primer on medical homes, accountable care organizations, and bundled payments. Kaiser Family Foundation, Feb. 2016. https://kaiserfamilyfoundation.files.wordpress.com/2016/02/8837-payment-and-delivery-system-reform-in-medicare1.pdf

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

EMERGENCY DEPARTMENTS: Medical homes help slow growth in ED visits

Medical homes were effective in slowing the growth of emergency department visits and ED payments in Medicare patients part of this large-scale study based on data from fiscal year 2008 to 2010.  Fee-for-service Medicare patients in 308 patient-centered medical homes recognized by the National Committee for Quality Assurance were compared with a control group of other Medicare patients.  The study also looked at inpatient hospitalization, but found no significant different between the medical home patients and the other Medicare patients in this regard.

Source: Pines, J.M., Keyes, V., and others. (2015, June). Emergency department and inpatient hospital use by Medicare beneficiaries in patient-centered medical homes. Annals of Emergency Medicine, 65(6), 652-660. Retrieved from http://www.annemergmed.com/article/S0196-0644(15)00003-7/pdf  Posted by AHA Resource Center (312) 422-2050, rc@aha.org


Hospital Trends: Emerging Health Care Delivery, Payment Models and Care Coordination Practices

This trend overview looks at medical homes and accountable care organizations as new health care delivery models. Based on the first analysis of FY2011 data collected as part of the AHA Annual Survey conducted during 2012, just 6% of responding hospitals were participating in an ACO, while 15% indicated they had an established medical home.

The overview also looks at how many hospitals reported involvement with bundled payment models; the extent that hospitals are engaged in care coordination/transition across care settings; and hospitals’ meaningful use of electronic health records.

Health Forum is further surveying hospitals on ACO adoption, with the data planned for release later this year.

Kenward K and Bostick N. Trends 2013: Emerging health care delivery, payment models and care coordination. Health Forum, an American Hospital Association affiliate, 2013. Available for sale as pdf download at http://ams.aha.org/EWEB/DynamicPage.aspx?WebCode=ProdDetailAdd&ivd_prc_prd_key=92b0ce53-d80b-43ef-9c7b-ec1a8211806e

NOTE: Also published as introduction in 2013 AHA Hospital Statistics. Health Forum, 2013. Available for sale at http://ams.aha.org/EWEB/DynamicPage.aspx?WebCode=ProdDetailAdd&ivd_prc_prd_key=f15837e6-7d5b-4beb-ba50-0c6c381ae53b

Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

POPULATION HEALTH: Catholic Health Initiatives’ pilot

Catholic Health Initiatives (Denver) http://www.catholichealthinit.org/, a large multi-institutional system, is working on managing population health based on the accountable care organization (ACO) model.  The target population is CHI employees.  The model is also structured on the medical home approach.  CHI hopes to cut employee health care costs by 10 to 14 percent. 

Why I like this article: At the end, there are suggestions on how other health systems might begin to approach population health management.

Source: Sanford, K.D.  Population health management: a “start small” strategy.  Healthcare Financial Management;67(1):44-47, Jan. 2013.  Click here for more information: http://insurancenewsnet.com/article.aspx?id=370913&type=newswires  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

ACOs: Should you include a ‘surgical home’?

The American Society of Anesthesiologists (ASA) has proposed a coordinated perioperative, or surgical home, model which would give anesthesiologists a leadership role in the development of an important component of accountable care organizations (ACOs).  This is a counterpart to the medical home model (which focuses on primary care and patients with chronic disease).  ASA envisions that anesthesiologists would evolve into “perioperative physicians” in this model.

Interesting fact: An estimated 60 to 70 percent of hospital expenses are related to patients who have surgery or undergo procedures.

Sources:  American Society of Anesthesiologists.  The Perioperative or Surgical Home, Aug. 21, 2011.  Click here for full text: http://www.saaahq.org/ThePerioperative_orSurgicalHome.pdf;  Warner, M.A.  The surgical home.  Newsletter. American Society of Anesthesiologists;76(5):30-32, May 2012; and, ASA responds to accountable care organization proposed rule.  Press Release, June 3, 2011.  Click here for full text: http://www.asahq.org/For-Members/Advocacy/Washington-Alerts/ASA-Responds-to-Accountable-Care-Organization-Proposed-Rule.aspx  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

Clinical integration of pediatric services at Mercy Health

Development of a regional integrated system for pediatrics services by Mercy Health (Chesterfield, MO), a multi-institutional system operating facilities in Missouri, Kansas, Arkansas, and Oklahoma, is described in this article.  Mercy Children’s Hospital, with inpatient care locations in St. Louis and Springfield, MO, is working with the large multi-specialty Mercy Clinic to create this integrated network.  Among the goals are strengthening the physician referral network and coordinating the delivery of pediatric care.  Initiatives include the establishment of a telemedicine network, and of a POINT (Pediatric Outpatient and Inpatient Navigation Team), composed of a nurse practitioner, RN, and social worker, which is tasked with care coordination for NICU patients and other children with complex issues.

Source: Mercy adapts services to region’s needsHealth Progress;92(3):21-23, May-June 2011.  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

Hospital cost drivers, market power, and relationship to hospital prices

A new report looks at hospital cost trends, why the cost drivers may vary among hospitals, and the relationship of those costs to hospital prices. Is market power due to a lack of competition a key factor for pricing, as some claim? This study from Compass Lexecon finds hospital prices are most directly related to the costs of providing patient care, with rising labor expenses over the past decade accounting for a significant proportion of overall hospital costs. Key factors found that account for price differences among hospitals include case mix, teaching intensity, Medicare and Medicaid payer mix, regional wage and other cost differences, uncompensated care, and patient demographics. Other  unexplained factors are discussed, but the authors conclude they found no basis to attribute these to hospital market power.

As antitrust concerns are raised with the formation of  accountable care organizations, medical homes, and other types of clinical integration to improve the quality of care and control costs, this report provides valuable perspective.


Guerin-Calvert ME and Israilevich G. Assessment of cost trends and price differences in U.S. hospitals. Washington, DC: Compass Lexecon, March 2011. http://www.aha.org/aha/content/2011/pdf/11costtrendspricediffreport.pdf

Related documents:

Cost trends & price differences; Assessment of cost trends and price differences for U.S. hospitals refutes unsupported claims of market power. Chicago: American Hospital Association, March 2011. http://www.aha.org/aha/content/2011/pdf/11costtrendspricediffppt.pdf

Guerin-Calvert ME and Israilevich G. A critique of recent publications on provider market power. Washington, DC: Compass Lexecon, Oct. 4, 2010. http://www.aha.org/aha/content/2010/pdf/100410-critique-report.pdf

Geisinger develops advanced medical home

The experience of Geisinger Health System, an integrated delivery system headquartered in Danville, PA, in developing an advanced medical home is described in this detailed article.  The ProvenHealth Navigator(sm) model was established initially to care for primarily elderly patients with multiple chronic conditions, but has since been expanded.  The model has been successful in decreasing hospitalization rates and cost of care.

Source: Steele, G.D., and others.  How Geisinger’s advanced medical home model argues the case for rapid-cycle innovation.  Health Affairs;29(11):2047-2053, Nov. 2010.