According to JAMA, the estimated cost of waste in the United States healthcare system ranged from $760 B to $935B which is equal to approximately 25% of healthcare spending.
One way to reduce the cost of care and clinical waste in a hospital is through a co-management program.
What is a Hospital Co-Management Program?
The Hospital Co-Management Program is an innovative model designed to improve the outcomes for patients in a hospital or the health system. Co-Management is a program where physicians and hospital operations teams collaborate on a specific set of pre-defined indicators to improve quality, safety, efficiency and decrease the cost of care. The physicians lead the indicator teams. In other words, a hospital contracts with Physicians to create a continuous process improvement system in the hospital to deliver better patient outcomes.
The Co-management model focuses on:
- High-value care – Improving quality, safety, efficiency
- Strategy and Operations
- Technology Optimization
- Stakeholders’ satisfaction (patients, physicians, and staff)
- Decrease the cost of care and clinical waste
The Co-management program in hospitals represents the best practice for achieving value-based care and improving the population’s health.
Integration of Co-Management into Graduate Medical Education
At our NAMC internal medicine residency program, as part of the DIO Lecture series, I and our program director Dr. Chahal gave didactics to our residents on the co-management program. We walked them through various steps of the co-management program by explaining a few indicators like the length of stay reduction, blood management program, and readmission reduction. The residents are participating in the hospital’s internal medicine co-management program and work on different indicators. The residents will have the opportunity to write articles and publish them in journals.
In my past role as the director of hospital operations at ECM Hospital, I led the co-management as the program lead for three consecutive years with outcomes greater than the national average. During those three years, we saved millions of dollars on clinical waste and cost reduction. Our Internal Medicine co-management program was successful in achieving value-based outcomes through improved quality, safety, operational efficiency, and patient experience. Our CEO was the chairman of the executive committee and a strong supporter of the co-management program.
Structure of Hospital Co-management Program
The structure of the co-management team includes hospitalists, primary care physicians (PCPs), Pulmonologists, Nephrologists, Cardiologists, Critical care intensivists, and other physicians and the hospital administration plus the operations team.
The Executive Team consists of representation from physicians and hospital administration members like the CEO, Chief Operating Officer (COO), Chief Medical Officer (CMO), Chief Nursing Officer (CNO), Chief Financial Officer (CFO), Chief Quality Officer (CQO)and Director of Operations or Associate Administrator. There will be a Program Lead who will be in charge of the day-to-day operations and oversight of the complete program. That member will be part of the executive committee and all the projects. The program lead will be the liaison between the physicians, administration, operations team, other medical staff members who are not on the co-management committee, and the third-party adjudicator.
The Executive team is the governing body that has the authority on how the hospital co-management program operates.
What is the Process of a Co-management program?
- Identify KPIs
Based on the data on quality, safety, finances, and operations, the program lead identifies and the executive committee decides on the Key Performance Indicators (KPIs) that will need improvement with a baseline measurement of targets. The KPIs include the name, description, inclusion and exclusion criteria, data sources, operations category, baseline, level one, level two, and the time period.
Some Key Performance Indicators include:
- High Foley catheter utilization
- Liberal blood and blood products transfusion;
- Inappropriate Inpatient MRI Usage
- A higher number of PICC lines usage
- Overuse of antibiotics;
- Supply cost reduction
- Increased Length of Stay
- Early discharge order timing
- High Readmissions into the Hospital due to AMI, CHF, COPD, Pneumonia, and TKR/ THR.
- Increased hospital-acquired conditions like CLABSI, CAUTI, MRSA, and Clostridium difficile.
- Prolonged ventilator days in intensive care units;
- Teams
The indicators are assigned to physicians and each physician takes responsibility for a specific indicator. So, the physician is the champion for the indicator. The hospital operations team supports the physicians depending on the indicator type.
For instance, if the indicator is related to the quality of care, the quality officer, infection control nurses, and data abstractors will be part of the indicator group. The Physician guides the indicator team on the best practices.
Role Of Executive Committee
The executive committee for the hospital co-management program decides what indicators should be included in the program. They analyze data from the previous years and use it as the baseline data of all the indicators. Then the committee decides on the improvement goals for the co-management period, which could be six months, nine months, or one year.
- The goals can be at two levels, level one is at 75-80% of the desired goal and level two is at 100% of the desired goal.
- The indicators are a mix of operations related to quality, safety, efficiency, patient and staff engagement, IT, etc. Based on the fair market value assessed by the third party, the financial value of each indicator is determined.
The committee decides on the number of indicators that will be part of the co-management program. If there are ten indicators and the value of each indicator is determined at $40000, then the total budget for the program is $400,000. The budget is divided into two parts: 25/75 or 20/80 ratio. The 25% is paid to the physicians as an hourly rate based on the fair market value. And 75% of the budget is pooled so that at the end of the program, depending on the success rate of indicators, the amount is divided equally among the physicians who participated in the co-management program. This is similar to the shared savings of other value-based programs. To meet compliance, there is a minimum number of hours that each physician should participate in every month depending on whether the physician belongs to the executive committee or participating member.
- Co-Management Program Contract
Depending on the budget, the number of indicators, and the number of physicians who participate in the program, the contract is prepared for the physicians to sign.
- Monthly Meetings
Once the contracts are signed by the physicians, a kick-off meeting is held. During the meeting, the participating physicians, the hospital administration, and operations team members like the case manager, quality director, and directors of the business office, pharmacy, laboratory, nursing, respiratory therapy, IT, and other required members are present.
The physicians pick an indicator of their preference and become the physician lead of the indicator. Depending on the indicator, the operation team members will be allocated.
The meetings can happen in the following way:
- Executive committee meeting where compliance and progress are discussed and minutes recorded.
- Whole program members meet monthly or according to the program policy. During this meeting, all the indicators are discussed. Each indicator physician or operation leader shares their indicator meeting points and the best practices. The meeting minutes are recorded and shared with the members.
- The indicator meetings should happen at least once or twice a month as per the compliance requirement.
- Following The Progress
On a monthly basis, the progress of each indicator is measured against the goals. Sometimes, whenever the committee feels that specialist expertise is required, they invite the specialist to the meeting for his expert opinion.
- Decision Making
The whole committee discusses the progress of indicators. If the committee is satisfied with the findings, they come to a consensus and approve the protocol or a guideline. Then this becomes a standard of care across the hospital after receiving the MEC (Medical Executive Committee) approval. This is communicated to the whole medical staff and hospital staff and is implemented under the co-management program supervision.
At the end of the co-management program, the progress on all the indicators is discussed and the success rate of all the indicators is calculated.
- Adjudication
The outcome rates are shared with a third party who adjudicates the payments and the program compliance. A report is submitted to the executive committee for final approval. The third party also decides the payments for the physicians based on the success of indicators.
Summary
The co-management models can be used for any process improvement programs, service line development of Orthopedic Surgery, Neuroscience, Cardiology, and Cardiothoracic surgery, Cancer center development, Care Coordination, Population health management, implementation of IT systems and EHR, etc.
Many hospitals are adopting co-management arrangements to improve operational effectiveness and patient care outcomes. The involvement of surgical and medical specialists improves hospital performance, helps hospitals avoid errors, and deliver quality care.
A clear, mutually agreed-upon service contract and collaborative ecosystem are crucial for the success of a co-management program.
Co-management and other value-based initiatives should be adopted by health systems and hospitals that plan to become high-reliability care organizations.