MEDICAL DIRECTORS – Class 6

Key: For Physicians to be Patient Advocates – Help Patients navigate through the health care system to receive appropriate quality care in most cost effective manner

HMO Medical Directors in order to be successful must:

  • Manage utilization
  • Assure quality standards of care
  • Influence providers to change the way they practice medicine

Medical practice guidelines are tools used by Managed Care Organizations to help Managed Care Organizations determine what is appropriate and necessary medical care

Beyond the traditional functions of recruiting, hiring, credentialing, training and overseeing clinical staff, physician executives are now heavily involved in projects like utilization review, outcomes measurement, medical informatics, patient tracking and work process redesign. They are also participating in general management functions such as strategic planning, marketing, managed care contracting, community health partnerships, and the acquisition, development and management of networks, group practices or facilities.

According to the article by David J. Ottensmeyer and M. K. Key, “Lessons Learned Hiring HMO Medical Directors,” HMO Medical Directors in order to be successful must:

  • Manage utilization
  • Assure quality standards of care
  • Influence providers to change the way they practice medicine

According to the article by MaryAnn Lando, “Maximizing the Role of Your Physician Executive,’ Healthcare Executive (May/ June, (1999), many healthcare organizations have retained the position title of “vice president of Medical Affairs”.  Beyond the traditional functions of recruiting, hiring, credentialing, training and overseeing clinical staff, physician executives are now heavily involved in projects like utilization review, outcomes measurement, medical informatics, patient tracking and work process redesign.  They are also participating in general management functions such as strategic planning, marketing, managed care contracting, community health partnerships, and the acquisition, development and management of networks, group practices or facilities.

According to the by David J. Ottensmeyer and M. K. Key article, “Lessons Learned Hiring HMO Medical Directors,” the HMO Medical Director in order to be successful must:

  1. Manage utilization;
  2. Assure quality standards of care; and
  3. Influence providers to change they way they practice medicine.

Medical practice guidelines are tools used by the MCO’s to help MCO’s determine what is appropriate and necessary medical care. There are some books that HMO’s might use such as Milliman and Robertson to understand what a normal case should be like. These books give diagnosis related guidelines. For more complicated cases, for abnormal situations, outliers, then the rules that HMO’s might use tend to involve severity of illness, intensity of service analysis involving physician’s own view.

There tends to be a learning curve for physicians to learn to stay within the HMO’s utilization management rules, but once they learn the rules the majority stick to the guidelines. A learning curve seems to be based on the membership. There tends to be a longer learning curve if HMO membership is small as compared to a larger medical group with more membership. Generally, learning comes on more rapidly, depending on volume of HMO enrollment to a particular medical group and general interest of that medical group.

It looks like around 70% of the physicians stick to the guidelines because the cases are not complicated and about 30% involve complicated cases involving more clinical judgment. These are just estimations. The medical guidelines might be modified for local factors as needed depending on community factors.

Some HMO’s might put the medical guidelines in their agreements such as with specialists. Others might make the guidelines voluntary and put in the written agreement certain terms such as that the physicians must submit data, keep practice open, general prescribing type of requirements so that in order for the physician to get certain financial incentives the physician must fulfill the terms of the agreement.

Hospitals can be viewed like flight operations on aircraft carriers as smart systems that have developed a “collective mind”, consisting of interrelating agents working alone and the system is constructed of interdependent know-how, teams of people who think on their feet and to the “right thing” in novel situations, and the consequences of any lapse of attention are swift and disabling

It is very important to understand that from the HMO’s perspective, the HMO is only adjudicating benefits and not giving treatment judgments. If the HMO denies a claim, it is up to the physician to act appropriately because in the HMO’s perspective they are only adjudicating the benefits and if the claim is denied then care could still be given but that the patient becomes a self-pay. HMO’s try to stay away from treatment decisions and utilization management to not effect outcome.

What is the best way for a physician to make his case if the physician thinks the patient needs something out of the guidelines

What is the best way for a physician to make his case if the physician thinks the patient needs something out of the guidelines where the physician thinks it is in the best interest of the patient. Depending on what the contract says between the physician and the HMO, one way might be for the physician to talk to the physician reviewer at the HMO or talk to the medical director. Some HMO’s might require physicians to write a proposal of the reason requesting service, list reasons why, make a strong case of what is to happen — where the physician appeals on behalf of patient. The Certificate of Coverage involving that patient would govern but maybe there could be exceptions so as not to set precedent. Some exceptions might be made for hardship such as where the patients needs are greater to serve that patient. An example might be where the HMO does not cover electric wheelchairs but in a specific case for a quadriplegic then perhaps the HMO might consider paying for that because it is the only mode of transportation that is standard for that kind of situation. As compared to a patient with arms where the HMO would not provide a scooter. Some HMO’s might like to think of themselves as being tough on sticking to the rules but reasonable when exceptions are being made.

An example of how medical practice guidelines could effect physicians is described in the Jim Montague’s article where: Managed Care Organization (MCO) makes practice guidelines part of contract. MCO monitors practice guidelines. If a physician deviates from a guideline in a specific case, that won’t be grounds for considering taking the physician out of the network. But if there is consistent deviation, MCO talk to the physician and sees if he or she has a problem with the guideline. If they have a problem MCO recommends they consider dropping out of the network because MCO expects them to follow the recommendation of their professional society. The next step is to say “Look, we have a rule – its in the contract” and ask them to leave the network.

Montague’s article is an interview of Illinois Blue Cross Blue Shield medical director in 1993 Arnold Widen and discusses the Illinois Blues Managed Care Network Preferred point of service product with practice guidelines for specialists. Dr. Widen says this product is like an HMO with an indemnity wraparound which allows members to seek out of network care if they pay a higher deductible and copayment. Blues don’t write the guidelines, they take the recommendations of the specialty colleges and professional societies or from the peer review medical literature that publishes guidelines. This product uses a formula to decide in which areas they had enough specialists based on a certain area or grouping of hospitals and how many patients they have.

“Physician Executives Strive for Balance in their Changing Roles”

John C. Babka, M.D. article, “Physician Executives Strive for Balance in their Changing Roles,” Healthcare Executive (May/June, 1994) looks at the characteristics of a physician executive.  Physician executives job according to this article is to help construct systems that cost effectively deliver high quality services and achieve positive outcomes in a competitive environment. Physician executives are involved in TQM and CQI. Physician executives relate both to physicians and management and manage and influence systems and processes.

The article by Donde P. Ashmos, Dennis Duchon and Reuben R. McDaniel, “Physicians and Decisions: A Simple Rule for Increasing Connections in Hospitals,“ Health Care Management Review (Winter, 2000), uses a decade of research on hospital strategic decision making and reinforces the simple decision rule of “let doctors help decide” for strategic issues.  This article gives managerial guidelines for implementing this rule:

  1. Encourage self-organizing:    let patterns of relationships emerge rather than try to preordain them.  For example, do away with dividing the hospital into clinical and non-clinical matters, thus predetermining that clinical issues will be resolved by clinicians and non-clinical issues will be resolved by administrators.  Allow appropriate patterns of relationships among important players to emerge as a function of information sharing and meaning generation.
  2. Create structures that allow for different goals, maximum participation in strategic decision making, and different strategic activities:    Managers need to be flexible enough to shape their organizations to fit the moment.  Mechanized processes may be pseudo-efficient but are in fact inefficient because they are insensitive.
  3. In order to develop strategies that are sufficiently complex for environmental conditions, allow for maximum physician participation in the design of those strategies:    Physicians as part of decision-making process offer rich interpretations of what is happening and better to articulate strategic activities.
  4. Look beyond the MBAs to the MDs for input in strategic decisions that affect bottom line:    “market medicine”, though important, should not be at the expense of the perspective of the clinical professional.
  5. Pay attention to the hospital’s predisposition:    predisposition or “dominant logic” is a sort of cognitive filter that determines what data the organization views as important and what data it ignores.
  6. If you want to change the hospital’s predisposition, alter who’s involved in making strategic decisions.
  7. Pay attention to what is being decided; involve physicians in decisions where they are likely to make the biggest impact.
  8. Check out your perceptions about how much physicians think they have say in strategic decisions:    Physicians almost always think they participate less in strategic decisions than executive think they do.  “Plunging in” to a decision process, without checking out the perceptions of important stakeholder groups about the process, leads to poor strategic choices and mistakes.

According to this article, hospitals are “incredibly fragmented places” in which four worlds exist:  the trustees, the physicians, the managers and the nurses.  Mostly these four worlds talk past each other, attempt to solve problems in isolation from each other, even if the problems are systemic problems that is problems that spread across multiple worlds.  Hospitals can be viewed like flight operations on aircraft carriers as smart systems that have developed a “collective mind”, consisting of interrelating agents working alone and the system is constructed of interdependent know-how, teams of people who think on their feet and to the “right thing” in novel situations, and the consequences of any lapse of attention are swift and disabling.

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