Michael Rohmiller, MD, is a dual fellowship-trained spine surgeon with Cincinnati-based Beacon Orthopaedics and Sports Medicine.
Here, Dr. Rohmiller discusses strategies for combatting rising costs and earning better reimbursement rates from payers.
Question: How have declining reimbursements for complex spine procedures affected your practice?
Dr. Michael Rohmiller: Reimbursement is a cyclical process that similar to real estate is based on: location, location, location. It is a wonderful example of game theory that is loved by some physicians and despised by others. Rather than allow a decline in reimbursement for complex spine procedures to alter one's clinical practice, I believe that physicians who have demonstrated excellence in complex procedures can leverage that experience when negotiating with payers.
For example, if one can demonstrate superior outcomes (via length of stay, lack of readmission, improvement in patient reported metrics, etc.), payers can be persuaded to 'reward' that surgeon with an improvement in rates. As with all other aspects of life, one must find a way to make lemonade out of lemons.
Q: What was your most recent struggle with payers? How did you navigate it?
MR: Over the past five years, we have had to work with payers to set rates that allow us to perform cases in an outpatient setting versus the hospital setting. Many payers are behind the clinical advancements, so we often need to use our data and clinical knowledge to show them the value of allowing certain procedures to be performed in the outpatient setting at a fair rate.
Q: What strategies can physicians in private practice employ to deal with rising costs and declining reimbursements?
MR: The best strategy for physicians in private practice is to demonstrate value. The goal is to show payers that the physician practice — imaging, therapy, ASC, and surgical care — provides the best value per dollar spent. The trend toward outpatient surgery has been propelled by this theory as excellent care can be provided at a fraction of the cost of the inpatient setting. A well-managed practice can easily justify an increase in reimbursement by excelling at the lower cost services available in the outpatient realm.
Q: What changes in reimbursement do you expect to see in the next five years?
MR: I anticipate payers will continue to reward providers that demonstrate excellent results in a cost-conscious practice. Providers that continue to use expensive facilities or services will find payers more likely to reduce reimbursement whereas surgeons that view the relationship with payers as a partnership looking to increase the value of excellent care will be rewarded with improved contracts. Bundled payments are one way in which payers attempt to encourage physicians to 'manage' the cost of care. Physicians that take a proactive stance in value-based care will reap the rewards regardless of a traditional fee-for-service or bundled payment model.