COVID-19 has created innumerable challenges for the healthcare system, some of which may seem a bit counterintuitive. While emergency departments are overloaded and ICUs are at critical capacity, the waiting rooms of primary care practices (PCPs) are empty.
Millions of patients have delayed or avoided care during the pandemic due to fears of exposure or inability to pay. These decisions have had a cascade of consequences. In addition to jeopardizing patient health, dramatically lower service volumes are putting the squeeze on the financial sustainability of many primary care clinics.
This is because traditional fee-for-service (FFS) reimbursement is not designed to withstand the new dynamics of the pandemic, explained Travis Broome, Vice President of Policy at Aledade in a recent MGMA webinar.
“From a fee-for-service perspective, the math is quite simple,” he said. “If there are no visits, there is no revenue. When visits start to disappear, you need to engage a new strategy to make sure you can keep your lights on. Accountable care provides the framework for sustainability.”
Participants in accountable care organizations (ACOs) have access to more options for replacing lost revenue and leveraging new funding resources from the Centers for Medicare and Medicaid Services (CMS), he said.
With a three-pronged approach to stabilizing practice finances, primary care providers can continue to serve their communities in a time of unmet need.
Replacing lost revenue with value-based care strategies
Unlike providers relying on reactive FFS models, PCPs participating in accountable care organizations are already equipped with the tools and strategies they need to stay connected with patients even when the physical office is closed.
At the Randy Walker Family Clinic in Arkansas, for example, it was a relatively easy adjustment to go virtual with the robust chronic disease management programs already in place, says Office Manager Angie Walker.
“Telehealth was one of the first things we stood up to make sure we could continue operations,” said Walker. “We assigned one front desk person to manage all patient questions about set-up and use, which has streamlined that process. Then we pulled data on all our congestive heart failure, asthma, and diabetes patients and put them at the top of the list for outreach and virtual visits.”
When in-person visits slowed down during the day, the practice’s nurses switched to making video calls to high-priority patients to conduct chronic disease management and explain new procedures. The clinic also assigned an additional provider to handle two-hour blocks of telehealth visits to keep pace with the demand.
Thanks to new telehealth reimbursement parity rules put in place during the health crisis, these services are billable for most primary care practices, allowing PCPs to directly swap the revenue from face-to-face visits with online conversations. Remote consults also ensure patients stay patients on track with managing their long-term needs.
“Patients still have to have healthcare. We don’t want our patients to be battling all these other chronic diseases when they’re also battling a pandemic,” Walker stressed. “We wanted to go full steam ahead with expanding our services and thinking proactively because we didn’t know what would happen in our region. Our staff has been phenomenal, and we’re very glad we took that approach.”
Accelerating revenue to cover unexpected shortfalls
Practices that require an immediate injection of cash to manage expenses can also explore opportunities to accelerate their revenue stream, Broome said.
“If you’re in a situation where a dollar today is more valuable to you than a dollar tomorrow, you need to find partners for whom lending that dollar is not a hardship,” he said. “There are banks, insurance companies, and other entities who have massive reserves and are willing to help.”
CMS and some private payers have offered advances on fee-for-service revenue and value-based care payments to support PCPs and other provider organizations. Additional federal relief efforts, like the Paycheck Protection Program and the CARES Act Provider Relief Fund, also help practices in trying circumstances.
“It’s important to remember that some of these programs, like the advances on earned revenue, are temporary and must be paid back,” Broome cautioned. “So be careful about how you use and account for these funds.”
In addition to taking advantage of the Paycheck Protection Program, the Walker Clinic went further to protect itself by renegotiating contracts and restructuring certain services to reduce avoidable expenses.
“Make sure you’re on top of your revenue cycle management, too,” urged Walker. “Don’t let money sit out there. Try to shorten your billing cycle so you can get reimbursed for the work you’ve done. We have a seven-day billing cycle so that we don’t get caught in the massive delays that have been going on.”
Accessing new sources of funding to sustain operations
In addition to loans and advances, PCPs may be able to acquire net-new sources of funding to keep their practices thriving, added Walker.
“There is a great deal of money available through grant programs and other initiatives,” she said. “We applied for everything we could – and were awarded quite a bit of it.”
“Everything went straight into a separate account so that we can use it if we need it. If we don’t need it, then that’s fantastic. But if we do, then we have something to draw on so that we can keep putting our patients first.”
The opportunities are constantly changing, said Broome, so practices need to stay on top of new programs and ensure they understand the rules and requirements of each initiative.
“No one has ever responded to a pandemic before – this is new for everyone,” he said. “You have to be careful about keeping track of your finances and spending because it’s your responsibility in the end. But do try to take advantage of what is out there so that you can keep thriving.”
As COVID-19 continues to alter the way primary care practices manage financial uncertainty, accountable care strategies can provide a framework for success.
By leveraging proactive care strategies, improving revenue cycle management, and exploring new sources of funding, primary care practices will be able to weather the storm and deliver exceptional care to their communities.