VHA Leadership Conference – The Journal of Healthcare Contracting

Engaging physicians
Know their language, talk their talk, and listen

If you want to engage your physicians in supply chain issues – and who doesn’t? – you’re going to have to do a few things:

Learn how to speak their language. (If you can’t, hire someone who can.)
Provide reliable, accurate data about the products you want your doctors to consider using.
Convince your physicians that you’re as interested in patient care as they are, and that money saved in one area can be invested in another to improve patient care.
Identify the movers and shakers among the ranks of your physicians, and enlist them in your efforts to reduce costs.
Talk less and listen more.

But you’re also going to have to demonstrate that you won’t be pushed around; rather, you’re there to ensure that the best interests of the physicians and the institution are tended to.

There is another way to approach it. Pretend you’re on a safari. That’s what Donald Stoner, M.D., chief medical officer, and Tom Beall, director, supply chain management, Halifax Health, Daytona Beach, Fla., suggested during their discussion about physician engagement, at this spring’s VHA Leadership Conference in Denver, Colo. They were just two of a number of speakers who addressed the topic of physician engagement at the Conference.

Safari
“‘Safari’ is the Swahili term for journey, and that’s what this is,” said Stoner. “It has its fun moments, but it’s also full of risks, dangers and pitfalls, and a surprising number of confrontations.” And really, how could it be otherwise? A lot of physicians view the hospital as a wasteful environment, ineffective and frustrating to work with, he said. Meanwhile, many hospital administrators view physicians as demanding and unconcerned about cost, and reluctant to align themselves with administration’s objectives.

“Safaris are fun but dangerous,” said Stoner. The contracting executive is likely to encounter herds of orthopods, surgeons and the occasional neurosurgeon. In fact, Halifax Health has about 500 physicians on staff, of whom about 130 are employed. “You have to have a good grasp of your staff, what motivates them. You need a clear understanding of what it is you’re dealing with, and that takes time. The things we’ve achieved didn’t happen overnight; it was a long, conscious effort.”

“What we’ve been trying to move toward is a more collaborative model, with win-win-win for our physicians, the hospital and our suppliers,” added Beall.

Reverting to the safari analogy, Stoner said the traditional medical staff is kind of like an elephant in the wild. He trudges along, does pretty much whatever he wants. “Everybody lines up behind him and nobody bothers him, and everything’s fine. But try to do something without his cooperation, and he’ll let you know he’s not happy with the direction.”

Similarly, hospital administration can always go in the direction the medical staff wants them to go, he said. But that approach doesn’t work anymore given declining reimbursement and the rising cost of care. “So we needed a new strategy.”

Cabinet
The strategy began with Stoner asking the medical executive committee if he could appoint a “cabinet” of physicians, representing a variety of demographics, departments and interests, to meet regularly on a variety of issues. “I said, ‘I need input from the medical staff, from people I can count on to tell me what’s going on and how they feel,’” he recounted. He got the executive committee’s permission, and assembled a cabinet of approximately 30 physicians.

That cabinet, along with Halifax’s utilization review committee, demonstrated to physicians that the hospital was serious about providing excellent patient care and about partnering with its physicians to see that that gets done, said Stoner. Credibility intact, Stoner and Beall set about figuring how to align the IDN’s interest with those of its physicians in the area of cost management. Their hook? Better patient care.

“Physicians want their patients to have the best care possible,” said Stoner. So, if physicians would agree to help administration reduce expenses, administration would agree to take some of those cost-savings and reinvest them in better patient care. “It’s a great way to align incentives,” he said.
To achieve those cost-savings, Stoner and Beall knew they would have to address the rising cost of physician preference items. To do so, they created the Technology Assessment Panel Committee, or TAP, for the purpose of reviewing requests for products whose value exceeds $500.

TAP is physician-led, for the simple reason that few supply chain executives are in any position to tell physicians what they can or cannot use in their practice, said Beall. To lead the committee, Stoner selected a surgeon with a tremendous reputation in the community and who is highly respected for achieving outstanding patient outcomes. It’s true he had a history of supporting administration in its discussions with the medical staff. Still, the staff knew he would not play favorites, said Stoner. “You can’t argue with quality and honesty. When it comes to dealing with physicians, fairness, acting equitably and transparency are issues you can’t bypass.”

The TAP Committee includes physicians from multiple service lines. Their responsibility is to review clinical documentation related to the device or technology being considered. Supporting their deliberations is the chief revenue officer, who performs reimbursement analyses; Beall’s department, which provides cost information; and others. Physicians requesting that a new product be brought into Halifax are invited to attend TAP and make a case for why they need it. In many cases, the sales rep is invited as well.

“It has been an extremely effective tool in educating physicians about all the decision parameters [related to the acquisition of new products or technologies],” said Beall. “We don’t want to dictate anything. That’s where [Stoner] is so great. He has a great demeanor when he approaches these surgeons. He wants to hear their concerns, and he’ll fight for them too, but he tries to balance all [considerations], always with the patient in mind.”

The strength of the TAP committee is the fact that it is a committee of peers, said Stoner. “When an administrator says ‘No’ to a doctor, you have a lot of antagonism. But when you’re sitting at a table with other doctors, there’s a much different impact. It’s a sobering experience. Physicians now think very seriously before they make demands for [new technologies], because when they do, they’re [potentially] taking money out of someone else’s budget.”

True stories
Using the committee approach, Halifax has achieved savings in a variety of product areas, including heart catheters, rhythm management devices, orthopedic implants, trauma products, trocars and bariatric products. In some cases, physicians and administration have stood side by side to prevent the incumbent manufacturer’s sales reps from waging counter-detailing campaigns.

“The longer you deal with physicians consistently, the more inclined they will be to align with you, because they know you’re serious,” said Stoner. “We have been able to convince them, ‘We’re not here to get in your way. But make no mistake, we’re committed to the goal of having the institution do well too. It’s not about you or me; it’s about us and how we take care of our patients.’

“Doctors are a wonderfully ethical group. They care about their patients. Sell them on, ‘Let me help you devise a way to care for all patients,’ and they’ll support you.”

Lifespan
In a separate presentation, Ed Bonetti, director of supply chain operations for Lifespan, a five-hospital IDN based in Providence, R.I., demonstrated that openness and transparency are key to gaining buy-in from physicians.

“Our physicians, administration and supply chain have a strong, collaborative relationship,” said Bonetti, who came to Lifespan following a career in the manufacturing sector. “And I would include vendors as well.”

Benchmarking and analytical tools are critical to success, said Bonetti. “To understand your current situation and present it in the form of data or dollars or opportunity, it’s important to be able to categorize them properly. You can do your assessment, achieve what you have benchmarked, and build credibility.”

Bonetti said he has the benefit of being on a single materials management information system for all five hospitals, with a single item master and single vendor file; and he negotiates systemwide contracts, ensuring uniform pricing for all hospitals. “My belief is that these are the foundations of a progressive supply chain.”

Different rules
After years of experience in manufacturing, Bonetti had come to expect that product decisions were straightforward. “In my previous life in the manufacturing sector, if you worked on specifications, tolerances and lead times, the process of changing vendors was more straightforward,” he said. Soon after arriving at Lifespan, he discovered the rules were different.

“In healthcare, you have to deal with the added complexity of physician preference,” he said. Oftentimes, physicians are aligned more with their vendors than with hospital administration. “This creates a dynamic where supply chain can be viewed as a villain, as preventing physicians from obtaining the products they need to deliver superior patient care,” he said. “We realized we had to engage our physicians, but at the same time, we realized we didn’t have the contracting model in place to do so. We lacked the ability to gather, analyze and present data in a way necessary to effectively present an opportunity. So we started shifting our approach and developed a transparent and collaborative contracting model.”

Taking a step back, Bonetti and his team reflected that physicians are scientific by nature, and they are comfortable working comparative data. “So we asked, ‘What can we do to understand the data elements, and then share it with physicians in a way that would not be interpreted as a frontal assault?’” What grew out of that question was a methodical approach to addressing new-product acquisition and utilization, which has yielded positive results in a number of product areas as endomechanicals, and hips and knees. “We focused on the opportunity and presented data that would allow us – administration and physicians – to work together to implement contracts that deliver sustainable savings or cost control.”

Data collection begins any number of ways, including the surgical and medical value analysis committees, for which Bonetti serves as co-chair. “We start to figure out, ‘What are we doing today, and what technology or changes might migrate to this space in the next two, three or four years?’” Next, the Lifespan team researches the vendors in the market, their respective market share, and their market share within the IDN. “We don’t pass judgment,” said Bonetti. “Instead, we identify data points around which we have robust conversations.

“We also look closely at our spend profile, focusing on our non-contract spend and our non-file spend,” he continued. The team looks at physicians’ practice patterns as they relate to the product area in question, including the direct and indirect costs of their procedures. “That becomes another point of discussion,” he said. “Yes, we may challenge the status quo, but it creates a dialogue.”

Pursuing the opportunity
After the team has identified a product conversion opportunity, they identify a clinical champion, oftentimes the chief of the department, to gauge his or her desire to work with supply chain, he said. “This discussion will determine whether a team will pursue the opportunity, postpone it for a more opportune time, or shelve it indefinitely.

With a decision to move forward, supply chain – with the chief’s endorsement – assembles the key stakeholders, including the high-physician users – to talk about the opportunity. Using data from The Advisory Board, Bonetti shows the physicians what similar hospitals are spending on the procedure(s) in question. “There’s credibility in that data,” he said. “At that point, active dialogue usually ensues, ultimately resulting in consensus on what the next steps should be.”
Clinicians are asked to evaluate the clinical acceptability of potential vendors through a structured trial process. Bonetti uses SurveyMonkey, an online survey tool, to collect and analyze their input. After a contract is awarded, Bonetti and his team track usage and expense data, as well as clinical outcomes and patient satisfaction, and report back to the physicians.

Key lessons? Bonetti listed three:

When tackling physician-preference items, make sure someone in supply chain has the clinical background to speak with doctors.
Identify the key stakeholders, based on volume and/or how opposed they might be with the prospect of a product conversion, and engage them in the process.
Focus on the practice patterns of the physicians and the direct implant cost.

Sidebar:
VHA awards

VHA recognized nine healthcare organizations for their work to improve operational efficiency and reduce costs from the supply chain while maintaining quality patient care. The 2012 winners of the VHA Leadership Award for Supply Chain Management Excellence demonstrated high levels of performance in at least one of six areas:

Sourcing and resource management.
Distribution, logistics and inventory management.
Supply chain innovation and creativity.
Supplier diversity.
VHA PriceLYNX Physician Preference Item Index Improvement.
VHA PriceLYNX Health Care Organization Index Improvement.

The winners were:

Elkhart General Hospital, Elkhart, Ind.
Gundersen Lutheran Health System, La Crosse, Wisc.
Lehigh Valley Health Network, Allentown, Pa.
Novant Health, Winston-Salem, N.C.
Union Hospital, Dover, Ohio.
Washington Regional Medical Center, Fayetteville, Ark.
WellStar Paulding Hospital, Dallas, Ga.
Wentworth-Douglass Hospital, Dover, N.H.
Yale-New Haven Hospital, New Haven, Conn.

Sustainability
Eight healthcare organizations were recognized for their work to develop and implement environmental sustainability programs. The eight winners of this award focused on a variety of sustainable and often systemwide, team-centered initiatives that yielded significant savings from paper recycling and waste reduction initiatives to reduced energy, water and toxic waste consumption to creating a food-service composting program and a roof-top garden, according to VHA. They were:

Beth Israel Deaconess Medical Center, Boston, Mass.
Parkwest Medical Center, Knoxville, Tenn.
Providence Health and Services Oregon Region, Portland, Ore.
Spectrum Health System, Grand Rapids, Mich.
Hallmark Health System, Inc., Medford, Mass.
NorthShore University HealthSystem, Evanston, Ill.
Spectrum Health System, Grand Rapids, Mich.
Yale-New Haven Hospital, New Haven, Conn.

Clinical excellence, community service
VHA recognized 28 of its member hospitals with the VHA Leadership Award for Clinical Excellence. VHA gives the award annually to recognize organizations that achieve top performance on clinical core measures established and tracked by the Centers for Medicare and Medicaid Services, including the Hospital Consumer Assessment of Health Providers and Services (HCAHPS) survey, which measures hospital patient satisfaction nationwide.

Meanwhile, VHA also recognized Allegiance Health, Jackson, Mich., and Spectrum Health System, Grand Rapids, Mich., for extending their caring missions into the communities they serve. The two organizations were presented with the 2012 VHA Leadership Award for Community Benefit Excellence. The award recognizes organizations for their focus and commitment to provide quality care benefiting their community, and for effective strategies to build awareness.