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Many Practice Management Educational Opportunities for the Anesthesia Community






The anesthesia community is rich in practice management educational resources. And now there is a new opportunity: The Advanced Institute for Anesthesia Practice Management. ABC, together with Medical Business Solutions and the Center for Continuing Education, Tulane University Health Sciences Center, is co-sponsoring the Advanced Institute for Anesthesia Practice Management (AIAPM).



A New Approach to Anesthesiology and Health Care System Safety: High Reliability Organizing (HRO)

Michael R. Hicks, MD, MBA
President and Chairman, Pinnacle Anesthesia Consultants, PA, Dallas, TX.

Clinicians in the specialty of anesthesiology have much for which we should be proud. Advances in our specialty have made the anesthetic experience both safer and more convenient even as we have advanced the care of our patients both in terms of who can safely receive anesthesia and where it is delivered. In fact, the rest of medicine and health care generally views us as pioneers in the patient safety movement.

Anesthesiology blazed the patient safety trail utilizing a variety of approaches: prudent adoption of improved technology, advances in pharmacology, advanced monitoring techniques, adoption of clinical practice guidelines and standards and by adopting some basic system theory and team-based behavioral principles and models to name just a few. Today, patients with even significant underlying health issues have higher expectations of successful surgical experiences than was thought possible a generation ago. These advances, embraced by us and persistent in our application, have become part of our culture of vigilance.

Reducing Error in the Health Care System

Unfortunately, our vigilance has been slow to spread far from our operating rooms to the rest of the health care system. Health care remains beset with errors, dangerous places and practices, and risks that our patients would not voluntarily tolerate in other aspects of their lives (Kohn et al., 1999; Richardson et al., 2001; Richardson et al. et al., 2001; Landrigan et al., 2010). We, as patients, are no different. Why then, as caregivers, do we not only tolerate a health care system that carries such risks but also actively work every day as integral participants without doing as much as possible to make it better?

In my career I have heard many reasons for our reluctance to change the system. Fears of malpractice or personal litigation, perceived loss of clinical autonomy, lack of authority, fear of retribution, the variability of individual patients, fear of being replaced by production driven surgeons and administrators, lack of financial incentive or even just apathy are just some of the reasons with which I am familiar. I have even heard it suggested that it is not a lack of intention or motivation on our part but that health care is fundamentally different than other process-driven enterprises and is incapable of achieving the performance standards demanded and produced elsewhere. However, increasing numbers of stakeholders—patients, payers, regulators and the government most notably—are demanding greater attention and accountability for the care that we collectively deliver. How then should we proceed?

Beyond Lean and Six Sigma to a New Approach: HRO

We have attempted to incorporate many tools from other industries with varying degrees of success. Lean, Six Sigma and other approaches are all in use and in some cases achieve almost mystical status in the minds of some in the industry. To be fair, when applied correctly these tools can produce significant performance improvements. In many cases, however, they ultimately fall short and produce only limited-term gains. Sometimes, because of misunderstanding and misapplication, they produce results worse than the baseline issues they were intended to improve. A primary reason for this is that these approaches are merely tools to address isolated processes. They are not changers of an organization’s underlying culture and so whatever gains are made erode over time, as behavior is subservient to culture and routine in nearly every circumstance.

Fortunately, there is much we can learn from outside of health care. There are organizations and industries that continue to demonstrate lasting success in minimizing errors, reducing opportunities for failure and generating value. From them we can learn the necessary tools and more importantly a solid theoretical construct that results in a great deal of practical success (at least in other industries) from which we can draw our own applications.

One such theory, known as High Reliability Organizing (“HRO”), was developed by observing the behaviors, process design, and ultimately the cultures of other industries that for various reasons have very, very low fault tolerances or alternatively, very high expectations for reliability (Weick & Sutcliffe, 2001; Vogus, Sutcliffe, & Weick, 2010). Note that the acronym “HRO” can refer to both the theory (High Reliability Organizing) as well to organizations that have embraced the theory (High Reliability Organizations) and the reader should use the context to discern the difference as the acronym is applied.

The classic examples of HRO industries are commercial aviation, the nuclear power industry and aircraft carrier operations. These industries have embraced the HRO culture because failure for them typically means catastrophic outcomes. Increasingly, however, organizations within health care such as The Joint Commission and the Agency for Health Care Research have proposed that health care organizations should be added to the list of HRO disciples, not as current examples of HRO in practice but as entities that could benefit from the aspirational goals of HRO thinking (The Joint Commission, 2012; Hines, 2008).



Five Key Principles of Mindfulness

It should be emphasized that the key principles of HRO can be explained fairly easily but that their successful application both drives and is dependent on an underlying “mindfulness” of an organization’s operation. The concept of mindfulness is for most people the most difficult concept to grasp. In simple terms, mindfulness refers to an ongoing, overall sense of operational and situational awareness that involves yet transcends the particular task that one is performing. In other words, and borrowing from the American Society of Anesthesiologists’ motto, mindfulness in my view is another manifestation of being vigilant on a continuous basis about the totality of the process. In our world it is akin to being the patient’s advocate when patients cannot do that for themselves.

High reliability organizations adhere to five key principles that serve as underpinnings for the general culture of mindfulness (Weick, Sutcliffe, & Obstfeld, 2008). Interestingly, and suggestive that HRO theory should resonate with anesthesia clinicians, the precepts of HRO are completely consistent with fundamental aspects of our daily practices as outlined below. My intent here is to explain in simple terms the core of HRO and to suggest that we as anesthesia clinicians are uniquely suited to embrace and promote the concept as we move the specialty forward into the future. While I believe that HRO concepts are actually the bedrock upon which the safe practice of anesthesiology rests, my frequent use of clinical examples from our specialty is largely for illustration purposes as the concept of HRO is applicable to any process where minimal defects are required and where consequences are great when errors do occur. In my opinion, our daily clinical application of these principles uniquely qualifies us to offer expertise in other areas of the health care system. That being said, let’s explore the basic concepts of high reliability organizing and organizations.

First, HROs are preoccupied with failure (or variance). HROs are constantly looking for signals, even very weak ones, that failure is occurring. Weak signals of failure, like a slight decrease in oxygen saturation, an increase in heart rate or airway pressure or even a drug vial in the wrong slot of the drug storage unit can be suggestive of a much greater systemic failure. A hallmark of HRO theory relative to failure or variance is not just a hyper-attention to these weak signals, but also that strong responses are taken when even weak signals are noticed.

For example, how many of us when confronted with a drug ampule in the wrong place merely move it to the correct slot and move on with our day, happy that we have caught the mistake? Or better yet, particularly as we try to expand our practices outside of the OR and the ICU, simply order a missing lab or imaging study that we need before proceeding on with a surgical case? Have we really solved the real problem when we see such a patient preoperatively lacking an adequate workup or just solved it for at that particular moment?

The answer to both of these questions is only a partial yes—for that particular patient we have but for the system we have not. Maybe the next patient won’t be so lucky and reducing the possibility for error, or catastrophe, for the next patient—for the next opportunity—is what sets high reliability organizations apart. In an HRO culture we still take care of that individual patient, but we elevate our observations up and out to the organization as a whole so that the processes can be appropriately modified. Only by doing this is the risk of failure—system failure—lower the next time. On a practical level, how will the pharmacy staff or the primary care practitioner ever learn of our downstream issues if we don’t do otherwise?

The concept of failure at the system level is an important one. HROs approach failure prevention at the system level by being mindful at the level of the individual and of the environment in which they operate and have prepared mitigating interventions when problems do occur. In an HRO culture, negative events such as errors or near misses are seen as opportunities to learn and improve. Reporting of actual events or near misses is encouraged, rewarded and treated in an open and non-punitive fashion. To do otherwise, results in less reporting, less data and information, and less learning. The organization that engages in the latter is the poorer for it as are the consumers of its services.

The second fundamental concept underlying the culture of HROs is a reluctance to simplify. This is counterintuitive for most people in that being organized is generally characterized as the ability to organize a large number of items, events, tasks or, in clinical terms, even physiologic symptoms and drugs into a much smaller number of categories. This categorization allows for more coordinated and thought out responses. But as Einstein reportedly said, “Everything should be as simple as possible, but not simpler.” Unfortunately, early warning signs of potential failure can be hidden with too much simplification. Details, meaningful ones, can be lost when we strip away too much of the alleged noise from the signal and categorize too broadly.

Even the names and labels that we attach to events and things can hide weak signals that if observed without the assigned categorization would portend possible negative outcomes. HROs recognize that they operate in complex environments and that failure, even repetitive failures, can occur in new and novel ways. Oversimplification can mask the signals of impending failure or lead one down the wrong path in terms of dealing with seemingly known issues.

A third characteristic of HROs is their attention to continuous situational awareness. This “sensitivity to operations,” as it is called, means that HROs pay attention to the work that is being done as it occurs and not how it is expected by policy or procedure to occur. In our world, for example, a lack of sensitivity to operations is why we continue to have an epidemic of wrong site, wrong drug, or wrong procedures being performed even though we likely all have universally adopted “time-out” procedures as supposed standards.

Sensitivity to operations also means that HROs focus not only on specific issues of the moment, but also broader ones that the system relies on to reduce the potential errors. For example, is the crash cart where it is supposed to be and fully stocked? Does the anesthesia machine check out before a moderate sedation case? Has the anesthesiologist or CRNA assigned to a case had adequate rest or training for the case at hand? This type of attention may seem trite to some, but to workers in an HRO environment it is just part of the organization’s continuous scanning of the situation. Once again, this should be second nature for us in anesthesiology.

Interestingly, and of particular importance to us in our field, is that one of the threats that HROs face regarding vigilance to sensitivity to operations is for routine tasks to become so routine that they become casual, even mindless. Consider for a moment the danger of this in caring for the surgical patient. How many times have you heard a colleague (anesthesiologist, surgeon, nurse) make a statement that an upcoming procedure is going to be simple or that a more thorough workup isn’t necessary? The fact that we frequently “get away” with accepting these circumstances does not diminish the real underlying threat that is present for the patient where we aren’t so lucky. Our experiences in situations like these and how we handle them on a system level is translatable to other aspects of health care and presents us opportunities to apply our experiences to the theory.

A fourth key HRO concept relates to an organization’s ability to deal with errors and issues as they arise. This ability is driven by what is characterized as a commitment to resilience and is predicated on the knowledge that the system, no matter how well designed, will still have failures. Handling errors, whether expected or not, requires training, forethought and an anticipation that errors can and will occur.

Much like our room preparation before administering an anesthetic, an HRO continually prepares for what ostensibly has already been prevented or can’t be anticipated by stressing teamwork training, mitigation strategies and by minimizing variations from the norm as a situation unfolds. In other words, although the events playing out are not exactly unfolding as planned, much like an unanticipated difficult intubation, the system (and us in the intubation example) has the necessary capacity and redundancy to handle the current crisis, return as close to normal as possible and learn from the endeavor as well.

Finally, HROs’ have a marked deference to expertise wherever it is in the organization. Expertise here refers to that person who has the most relevant knowledge of the situation that is unfolding. Expertise does not mean the most experienced or the most senior person as neither experience nor seniority necessarily carries with it the knowledge of the given situation at that moment in time. Expertise can mean that an individual only recognizes that something is amiss and the only action available to them is to bring the production process to a halt until other mitigating strategies can be implemented.

This, among all of the HRO strategies in my opinion, would be the most meaningful and easiest in theory to implement in health care. Unfortunately, health care remains a rigid, hierarchical industry that more encourages silence, silos, and passing issues on to others to discover and solve instead of an environment based on transparency, open communication, and non-punitive responses to error handling.

A Natural Fit for Anesthesiology

Taken together, the precepts of high reliability organizing should be applicable to all of health care. In my opinion, anesthesiology practice in its purest form is based on HRO principles whether we know the HRO theory or not. Because of this, and because we have excelled in its application, even unknowingly, I think that there is a role for us to be both disciples and advocates for high reliability organizing being embraced throughout the health care system.

While the motivations should be intrinsic, however, the reality is that very little changes in clinical practice or within the health care system without the application of external forces and the passage of time. This is unequivocally true for the changes in culture that HRO requires. There is no lack in the scientific literature of references to high reliability organizing and the health care system or the clinical practice of anesthesiology (Sutcliffe, 2011; Chassin & Loeb, 2011; Dixon & Shofer, 2006; Wilson, Burke, Priest, & Salas, 2005; Gaba, 2000). Despite the applicability of HRO concepts and culture to anesthesiology our uniquely applied expertise in this area remains largely unrecognized even within our own ranks. This may be ripe for change, however, as increasingly both internal and external forces are now working to bring HRO to health care.

For example, large purchasers of health care such as the government and employers don’t understand why what they take for granted as common sense business practices aren’t being applied to the care they purchase and receive. Similarly, the health care industry continues to consolidate and seek opportunities to create greater value and one of the compelling ways to do this is by embracing an HRO culture. High reliability organizing offers the opportunity to increase value, decrease harm and its potential associated costs, and improve system performance.

Finally, influential entities such as The Joint Commission, the Agency for Healthcare Research and Quality and the Institute for Healthcare Improvement have embraced the concept of HRO and are advocating for its adoption and implementation (The Joint Commission, 2012; Dixon & Shofer, 2006; Resar, 2006). The interest and direction of these organizations will likely drive further implementation of high reliability organizing in health care. As anesthesiology clinicians, however, we should embrace the opportunity that our experience in this area gives us and be at the forefront as the high reliability movement proceeds.

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Chassin, M. R., & Loeb, J. M. (2011). The ongoing quality improvement journey: next stop, high reliability. Health Aff (Millwood), 30(4), 559-568.

Dixon, N. M., & Shofer, M. (2006). Struggling to Invent High-Reliability Organizations in Health Care Settings: Insights from the Field. Health services research, 41(4p2), 1618-1632.

Gaba, D. M. (2000). Anaesthesiology as a model for patient safety in health care. BMJ, 320(7237), 785-788.

Hines, S. (2008). Becoming a high reliability organization: operational advice for hospital leaders. Agency for Healthcare Research and Quality.

Kohn, L.T., Corrigan, J.M., Donaldson, M.S. (1999). To Err is Human. Building a Safer Health System. Committee on Quality of Health Care in America. Washington, DC: Institute of Medicine

Landrigan, C. P., Parry, G. J., Bones, C. B., Hackbarth, A. D., Goldmann, D. A., & Sharek, P. J. (2010). Temporal trends in rates of patient harm resulting from medical care. New England Journal of Medicine, 363(22), 2124-2134.

Resar, R. K. (2006). Making noncatastrophic health care processes reliable: Learning to walk before running in creating high-reliability organizations. Health Serv Res, 41(4 Pt 2), 1677-1689.

Richardson, W. C., Berwick, D., Bisgard, J., Bristow, L. R., Buck, C. R., & Cassel, C. K. (2001). Crossing the quality chasm: a new health system for the 21st century.

Sutcliffe, K. M. (2011). High reliability organizations (HROs). Best Practice & Research Clinical Anaesthesiology, 25(2), 133-144.

Commission, T. J. (2012). Improving Patient and Worker Safety: Opportunities for Synergy, Collaboration and Innovation.

Vogus, T. J., Sutcliffe, K. M., & Weick, K. E. (2010). Doing no harm: enabling, enacting, and elaborating a culture of safety in health care. The Academy of Management Perspectives, 24(4), 60-77.

Weick, K. E., & Sutcliffe, K. M. (2001). Managing the unexpected. Jossey-Bass San Francisco.

Weick, K. E., Sutcliffe, K. M., & Obstfeld, D. (2008). Organizing for high reliability: Processes of collective mindfulness. Crisis management, 3, 81-123.

Wilson, K. A., Burke, C. S., Priest, H. A., & Salas, E. (2005). Promoting health care safety through training high reliability teams. Quality and Safety in Health Care, 14(4), 303-309.

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Michael R. Hicks, MD, MBA is a physician executive based in Dallas, TX. He is President and Chairman of Pinnacle Anesthesia Consultants, PA. In addition Dr. Hicks is a consultant for a national hospital and ambulatory surgery center company. He can be reached at michael@hicks.net.

What is the Value of A Chronic Pain Practice to an Anesthesia Group?

Jody Locke, CPC
Vice President of Anesthesia and Pain Management Services, ABC

Many anesthesia practices across the country are hybrid entities, consisting of a subgroup of anesthesiologists and CRNAs who provide only surgical and obstetric anesthesia and another subset who spend part or all of their time in the management of chronic pain. The circumstances that have encouraged the development of such entities vary considerably, but it is a common phenomenon across the country in all types of settings.

In some cases, the different sets of providers appear to work quite harmoniously but these are the exceptions rather than the rule. Most struggle with a consistent set of challenges that derive directly from the fundamental differences between the two types of practices. Even a cursory review of any of these practices reveals just how different the criteria are for success in chronic pain as compared to O.R. or obstetric anesthesia. Simply put, the demands of a hospital-based anesthesia practice bear little or no resemblance to those of an office-based pain practice. While the one thrives on harmony and collaboration, the other feeds on individualism and a desire to take more control of one’s destiny. Some would even say that is it almost paradoxical for the two to co-exist successfully in the same entity. It is not at all uncommon for such arrangements to ultimately end in a complicated and messy divorce. Why then do we see so many such arrangements and why does the question keep coming up: what is the value of chronic pain medicine to an established anesthesia practice?

Etiology of Pain Practices

Two factors are typically attributed to the initiation of a chronic pain practice within the anesthesia group: one is an offshoot of the very nature of the specialty and its preference for individualism; the other is a more subtle and sometimes elusive strategic argument. Consider the following prototype: twenty anesthesiologists have bound themselves together into a group practice. Over time two or three members start to perform nerve blocks on a very selective list of patients in the recovery room during their downtime in the afternoon. Based on this limited experience they pursue the concept of a more active chronic pain service. One or two physicians often make the argument that a dedicated pain service would be in the best interest of the practice and the relationship with the hospital. Sometimes a few other providers will agree to contribute to the new service. Once the practice starts down the path it is not at all uncommon for the result to be a dedicated practice model that requires separate management to accommodate the needs of all the patients being scheduled. Inevitably, despite the arguments to the contrary, it is fundamentally the desire of the pain physicians to do something different and have more personal control over their practice and activities that encourages to evolution of the practice.

This is not to say a business case cannot be made for an expansion into chronic pain. A hospital-based anesthesia practice, especially one that is fundamentally tied to one facility or system, has limited strategic options. The volume of cases is tied to the community of surgeons and the reputation of the facility. The payer mix is a function of the population being served. By all accounts the practice is captive to the system for its revenue potential and viability.

The good and the bad news about chronic pain is that the practitioner starts each day with a blank slate or an open schedule. As a practical matter he or she has relatively free rein to take the practice in whatever direction suits the preference of the provider. There is ample evidence to indicate that motivated and strategically insightful pain physicians have the ability to work as hard as they choose. They have a unique opportunity to build referral bases and thereby change their payer mix by encouraging more referrals from physicians with patients with better insurance. Pain physicians can also dramatically impact their income by virtue of the kinds of services and procedures they perform. Well managed pain practices typically see their providers generating at least 50% more in gross collections per clinical day than their colleagues working in the operating room. To put this in concrete terms: most anesthesia staffing models for physician-only practices are based on a gross revenue potential per anesthetizing location day of between $1,900 and $2,100. It is not at all uncommon for pain medicine professional fees, not including facility payments, to exceed $3,000 per provider day. Those willing to accept the risks and responsibilities of managing a free-standing pain clinic can net significantly more per clinical provider day.

Given these facts, why wouldn’t every anesthesia practice want to find a couple of qualified pain specialists and set them up in practice? It is the answer to this question that reveals just why so few anesthesia-based chronic pain practices are successful and why so many group practices that have a pain component wish they didn’t. As is so often true in business, the devil is in the details. A failure to understand and appreciate the management complexity of a busy chronic pain practice probably explains most of the frustration and dissatisfaction.

It is probably worth noting that most successful anesthesia practices don’t realize how good they have it. There is an oft-quoted, but unfortunately quite misleading, notion that success begets success. The anesthesia practice that has benefitted from a favorable location, payer mix and consistently strong surgical volumes may prove to have very unrealistic and naïve ideas about launching an entirely different practice model whereas the practice that has always had to focus on every aspect of the budget to hire and retain qualified providers to meet the expectations and service requirements of the hospital probably has a better understanding of what is involved in building an entirely new service line. After all, they probably have nothing to lose.

Managing the Patient and Payer Mix

Simply put, any surgical practice relies on patients, procedures and payments for its livelihood and success. This might sound simple, but these requirements can be deceptively complex to consistently achieve. Having the necessary management oversight, monitoring tools and infrastructure are critical prerequisites. Invariably an unwillingness to hire the necessary staff, invest in appropriate technology and commit resources to monitor the practice closely sets these practices up for failure from the outset.

The ultimate challenge in each case lies in knowing what the right objective is. It is easy to say that patients make the practice but too many pain physicians confuse filling the schedule with developing a referral base. They tend to accept all comers initially and then, if they are lucky and still in business, end up paying the price down the road. Just as it can be said that many college students spend their sophomore year trying to distance themselves from the friends they should not have made their freshman year, so too, pain physicians often spend their second or third year in practice wondering why they are working so hard but making so little money when the answer is quite simple: they should have been more selective in the early phases of the practice.

The ideal sweet spot for a chronic pain practice involves a population of patients that allows for two things: the ability to manage patients for a limited period of time and patients whose insurance will cover the costs of providing the care. Three to five encounters with a patient is probably optimum. This would involve a comprehensive evaluation, a series of procedural interventions and a discharge. This would absolutely not involve the patient who has been referred for medication management that requires regular follow-up visits for refills without any opportunity for procedural intervention.

The mix of patient insurance is absolutely critical but often challenging to manage effectively. Every American physician understands that what Medicare pays does not really cover the cost of care and Medicaid in most states is even worse. Having a population of patients with good commercial insurance is essential. In some states, Workers’ Compensation can be a godsend, but this, too, is changing, especially in states like California. What too few pain physicians understand is both the need to encourage referrals and the impact this can have on their bottom line. Fundamentally, they do not appreciate the need for marketing and promotion. A practice whose physicians believe they are too busy to promote the practice is a practice that is doomed never to change its financial viability or profit potential. Let us suppose that the number of Medicare patients is a given. The practice cannot improve its revenue potential by reducing the number of Medicare patients, but it can do so by increasing the number of non-Medicare and commercial patients. Sometimes you solve one problem by creating a bigger problem.

Volume and Value in Chronic Pain Practice

Another dimension of the chronic pain practice that is poorly understood by the non-pain provider is the distinction between the evaluation of patients and the interventional modalities used to address their conditions. Consultative pain physicians must distinguish the value of the service they perform by critically evaluating their patients before any interventional modalities are performed. The practice that does not appreciate this will be relegated to the category of “block shop” and quickly displaced by cheaper alternatives more willing to provide services and discount their rates. Medicare policy makes it abundantly clear that any injection of steroids must be preceded by a comprehensive review of previous attempts to address the patient’s condition and an assessment of appropriate treatment options. Since the typical chronic pain patient is a 43 year old male who has been to see 6.8 other providers prior to contacting the pain physician, the expectation is that that specialist will be a better diagnostician than the previous providers. The objective, therefore, is not to default to the role of replaceable technician but to define a different value proposition for the patient.

When we talk about the financial significance of the procedural aspect of the pain practice it must be viewed through the lens of the overall management of the patient. While it is true that a pain physician who can consistently perform three or four steroid injections an hour can make a considerable income in the short term, his earning potential will be quickly eclipsed by either boredom or competitive options that are more focused on the whole patient. Unfortunately, too few practices have reliable or comprehensive outcomes data, because this is what patients and payers want. Each treatment plan should be carefully considered based on the patient’s history, medical condition and resources for improvement.

Pain Management Practice Costs

Even so, having good providers doing all the right things for their patients is still no guarantee of success. All is for naught if they cannot be paid appropriately. Here is where anesthesia practices are at their most naïve. They think that just because they have negotiated a favorable percentage-of-revenues fee with their billing agent, they will get the same level of service in chronic pain. Despite what claims may be made by billing agents, it is an absolutely impossible proposition. A quick review of the basic economics of the matter underscores the problem. Suppose the typical anesthesia case nets $400 on average and the cost of billing is four percent. This results in $16 of revenue per case for the billing office to code, bill, resolve the patient’s account and provide the necessary reporting so that the practice has a level of comfort that they got what they were entitled to. Now let us consider the average revenue per pain encounter, which we will define as all the services rendered to a patient on a date of service. Under the very best of circumstances this could be as high as $200 but is more likely to be closer to $150 and might be even lower than that. Now the revenue potential to the billing office has dropped from $16 to $8 or less per encounter. Ask any coder or biller and he or she will tell you that the average pain claim inevitably involves more interaction and follow-up than the corresponding anesthesia claim. The challenge is then further compounded by the very complexity of treatment options and payment modalities. Instead of wanting confirmation that all Blue Shield claims were paid at the contractual per unit rate, the pain physician wants to know that every CPT code billed was paid according to the contractual fee schedule and reflected the appropriate application of such things as the multiple surgical payment rules and special considerations for bilateral procedures. Is it any wonder why some billing companies simply refuse to take pain practices? Effective pain management billing necessitates line item billing and the ability and resources to identify all inaccurately paid claims and review them.

In addition to these anxiety-creating realities for the billing staff, consideration must be given to the basic management requirements of scheduling, insurance verification and pre-authorization that are virtually nonexistent in anesthesia practice management. Record keeping can be another area of huge concern and consternation. Dictating, reviewing and approving patient evaluations and operative reports is considerably more time-consuming and onerous than completing anesthesia records, especially when the typical surgical anesthesiologist sees an average of five patients per day while a moderately busy pain physician sees between 12 and 20. While the average total practice overhead for an anesthesia practice should not exceed 10 percent, including billing, it is not uncommon for the overhead of the pain practice to be two or three times this much. It is true that the anesthesia practice that is able to partner with the facility may be able to avoid some of these costs, but in so doing they also limit their revenue potential.

Understanding the Load and the Rewards

All of these considerations start to explain why pain physicians tend to believe that they work much harder than their colleagues in the operating room. The principle that perception is reality is often the single most divisive factor in a hybrid practice, especially one that pays all shareholders or physicians equally. Why should a pain physician go out of his or her way to work longer hours, offer flexible office hours or aggressively pursue referrals if there is no financial incentive to do so? Any group that does not recognize the unique requirements and opportunities associated with chronic pain practice in the details of its compensation plan will ultimately sell itself short. Human nature being what it is, people need a reason and a motivation to work harder and take more risks.

Other issues can prove equally divisive. The allocation of call assignments can be especially problematic, especially when the assumption is that those physicians who perform chronic pain service must share the surgical and OB call burden. More than a few practices have separated base don this issue alone.

There is a perception that the inclusion of a chronic pain practice is perceived as a positive service enhancement by hospital administration. The anecdotal data is somewhat inconclusive on this point. It is certainly true that the ability to draw patients to a hospital and to generate facility fees for the institution should be considered a positive aspect of any pain practice. One could even argue that in the current environment, with the anticipated changes of healthcare reform around the corner, a hospital administration would view any expansion of services as positive. Some have even entered into serious discussions with groups that have provided a limited scope of pain management services to explore co-management options. The politics of chronic pain can be a little tricky in cases where anesthesia has not been involved historically. More often than not the revenue potential is not viewed as significant enough to disrupt established relationships. It is always an angle worth pursuing but it is clearly one that should be carefully and completely analyzed. The administration will no doubt expect a full pro forma and probably expect an outside consultant to perform a qualified analysis. Administrators are notoriously skeptical of propositions that propose a significant influx of new revenue. They are trained to look for the catch, or the capital they are being asked to invest so that the pain practice can be successful.

Anesthesia practices need to be especially prudent in any discussion of the establishment of a free-standing clinic. The last thing an administrator wants to hear is that the group intends to set up an independent entity that may well compete with the hospital for patients even if this is ultimately the most profitable option for the group. It is always best to play this card very carefully and only after all other options have been considered and discussed.

With all these considerations in mind we return to our original question: should anesthesia practices pursue chronic pain management as a reasonable way of diversifying the practice and mitigating some of the market risk they face in the current environment? The answer is yes, if, and only if, they are willing to make the investment in developing a business plan that is realistic and practical, in hiring or identifying qualified providers, in giving them the necessary tools and rewards to be successful and investing in the necessary infrastructure. It is an all or nothing proposition. A poorly-managed pain practice is much worse for all concerned than no pain practice. The opportunity lies in careful planning, committed execution and constant monitoring and oversight. Ultimately, it is the very challenges that will provide the opportunities for those practices willing to do it right.

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Jody Locke, CPC, serves as Vice President of Pain and Anesthesia Management for ABC. Mr. Locke is responsible for the scope and focus of services provided to ABC’s largest clients. He is also responsible for oversight and management of the company’s pain management billing team. He will be a key executive contact for the group should it enter into a contract for services with ABC. He can be reached at Jody.Locke@AnesthesiaLLC.com.

Value for Hospitals, Anesthesiology Practices and Physicians

As we head into the final quarter of the year, the departmental and group stability that anesthesiologists seek remain elusive. Hospitals and health systems continue their drive toward consolidation. National management companies report more and more acquisitions of anesthesia practices. The Affordable Care Act’s Health Insurance Exchanges will have begun to enroll beneficiaries by the time this issue of the Communique is in your hands, with much of the uncertainty over the functioning unresolved. Indeed, after forty attempts by the House of Representatives to repeal the Affordable Care Act, much of the law will be in effect by January 1, 2014, unless there is a successful forty-first or forty-second attempt, which strikes us as unlikely. Defunding may yet kill the ACA, but for now we must proceed on the assumption that the law will be very much with us next year.

The new environment demands accountability as well as “value” and not “volume” from providers, as we have heard many times. “Value” is the aggregate measure of patient outcomes (e.g., mortality rates, patient satisfaction, and absence of complications) divided by total cost per patient over time. Michael Hicks, MD, MBA introduces a value concept that is relatively new to health care—but a natural fit for anesthesiology—in the cover article, A New Approach to Anesthesiology and Health Care System Safety: High Reliability Organizing (HRO). HRO differs from Lean and Six Sigma in that it involves a culture of mindfulness; it is more than a set of process-improvement tools. Read the article to discover the five basic requirements of HRO mindfulness (preoccupation with failure, reluctance to simplify, sensitivity to operations, commitment to resilience and deference to expertise). Plan to attend the Advanced Institute for Anesthesia Practice Management in Las Vegas April 11-13, 2014 to hear Dr. Hicks’s presentation on HRO.

A very different angle on the relationship between outcomes and cost is the heart of Jody Locke’s article, What is the Value of a Chronic Pain Practice to an Anesthesia Group? Every hospital-based anesthesia group considering adding a chronic pain medicine service line should consider the risks and the known costs that lead to disappointment in many cases. To succeed, the chronic pain division must attract the right patients with the right insurance, which will probably require analysis and marketing; the pain specialists must develop and follow individualized patient treatment plans, and the practice must anticipate greater expenses for billing, scheduling, insurance verification, pre-authorizations and record-keeping. That is just the beginning. Constant monitoring and oversight are also necessary. Keeping the anesthesiologists’ and pain physicians’ workloads balanced is difficult. Venture into this realm with your eyes open.

Sometimes the relationship that founders is not with the facility or colleagues, but with patients. In our context, this means pain patients. Neda Ryan, Esq. provides an overview of the relevant considerations in How to Legally Break Up with Your Patient.

For those who may conclude that the rigors of increased accountability and the hassles of growing the revenue stream are excessive, Mark Weiss, Esq. sounds an alert in his article The Siren Song of Hospital (Un)Employment. Hospitals’ quest for “alignment” of physicians is a different word for “control.” Hospital control may not be benign, and it may not entail the income security sought by many anesthesiologists.

Malpractice expert Christopher Ryan, Esq. discusses yet another set of pros and cons in his article So You’re Thinking about Serving as an Expert Witness? Here’s What You Need to Know. The most obvious benefit is the compensation. Interested anesthesiologists who are new to the exercise should check their employment contracts, as these sometimes provide that expert witness fees belong to the practice rather than the physician. On the negative side, “most of the time testifying as an expert means being cross-examined by attorneys for hours on end,” in Mr. Ryan’s unflinching words.

As is often the situation, much of the information we provide to the anesthesia community consists of “Don’ts” and various warnings. That is not to convey the impression that we fear the future. We think it remains very bright for anesthesiologists who try to anticipate and creatively adapt to the many changes in our near and long term futures. We hope that you will keep proving us right.

With best wishes,

Tony Mira
President and CEO
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How to Legally Break Up with Your Patient
Neda M. Ryan, Esq.
Clark Hill, PLC, Birmingham, MI
At some point toward the beginning of their careers, physicians are required to take the Hippocratic Oath in which the physician covenants to heal the sick or to prescribe measures for the good of the patient. Unfortunately, in an environment in which overdoses on prescription medication are quickly rising to the top of the list of causes of death, zealous adherence to this portion of the Oath could leave pain management physicians exposed to liability. Furthermore, blind adherence to the Oath is not a legal defense to injury or death associated with the misuse or diversion of prescriptions. Luckily, there are steps that pain management physicians can follow early on to promote a beneficial relationship for the patient and to minimize legal risk to the physician. Still, even when preventative steps do not produce the intended results, there are measures that can be taken to legally terminate the relationship with the patient.
Prescribing Controlled Substanances: Legitimate Medical Purpose
The laws and regulations surrounding prescribing include the Federal Controlled Substances Act, the Drug Enforcement Administration’s (DEA’s)regulations and guidance, and relevant state law and guidance from medical boards. The Supreme Court and the DEA have both made clear that controlled substances must be prescribed for a legitimate medical purpose by an individual practitioner acting in the usual course of his or her professional practice. It is clear that this standard is vague and, thus, a physician’s prescribing is analyzed on a case-by-case basis.
Warning Signs for Problematic Patients
The DEA has set forth a number of warning signs for problematic patients that include the following:
• Patients demanding to be seen immediately;
• Patients stating that they are visiting the area and are in need of a prescription to hold them over until they return to their local physicians;
• Patients feigning symptoms in an effort to obtain narcotics;
• A patient indicating that non-narcotic analgesics do not work for him or her;
• A patient requesting a particular narcotic drug;
• A patient complaining that a prescription has been lost or stolen and must be replaced;
• Patients requesting more refills than were originally prescribed;
• Patients using pressure tactics or threatening behavior to obtain prescriptions; and
• A patient showing visible signs of drug abuse (e.g., track marks, etc.).
The appearance of one or more warning signs is not dispositive of inappropriate use or diversion of prescriptions. As such, the pain management physician should take into account each individual patient’s condition and medical history prior to determining whether action must be taken.
Proactive Steps You Can Take Now
The DEA does not require that pain management physicians prevent all instances of diversion and abuse. It also does not require that all drug abusers be denied all drugs. Rather, law enforcement officials will look to the steps the pain management physicians took to meet his or her legal responsibilities to prevent diversion and abuse. The questions that will be considered include the following:
• Was there a legitimate medical purpose for the prescription?
• Was the pain management physician acting in the usual course of his or her professional practice?
• Has the pain management physician taken reasonable measures to prevent diversion (e.g., were the actions taken tailored to the specific patient, did the provider exercise the appropriate degree of medical supervision, etc.)?
The determination is extremely fact specific with special attention being given to those patients who are known drug abusers.
In addition to DEA regulations, there are many other steps pain management physicians may take to prevent abuse and diversion of the medications they are prescribing to their patients:
• Evaluate the Patient—Obtaining, evaluating and documenting a medical history and physical examination, indicating the nature and intensity of the pain, current and past treatments for pain, underlying or coexisting diseases or conditions, the effect of the pain on physical and psychological function, and history of substance abuse.
• Develop a Treatment Plan—A written plan of the patient’s treatment should, in addition to setting forth the patient’s plan, state objectives that will be used to determine the success of the treatment. The plan should be fluid and flexible enough to evolve with the patient’s progress and needs.
• Obtain Informed Consent—The risks and benefits of the treatment should be explained to the patient. Sometimes, a signed form may be necessary to inform patients of certain prescriptions and to document that consent was obtained.
Execute a Treatment Agreement—If the patient is at high risk for medication abuse, the physician may consider using a Treatment Agreement that sets forth the obligations of the patient with respect to the medication as well as the consequences for failure to adhere to the agreement. Specifically, the Treatment Agreement could address the following: obtaining medications (or certain medications) from a single source, safeguarding the medications, the use of illegal substances, standards or requirements for refills, submission for drug testing, terminating the relationship for failure to comply and monitoring any state databases, as applicable.
• Periodically Review Treatment—The provider should periodically review the patient’s course of treatment and any new information about the etiology of the patient’s health and/or pain. As stated above, the treatment plan should be fluid enough to permit for changes arising out of any new information uncovered during a periodic review.
• Refer Patient to Another Provider—In some instances, patients must be referred to another provider or specialist for additional or continued treatment of the patient. Care should be taken to ensure at-risk patients are properly managed and cared for during the transition.
• Check State Prescription Monitoring Programs—Some states have prescription monitoring programs in which providers may access the database to see if their patients are obtaining certain medications from other sources. For state having such prescription monitoring programs, pain management physicians should confirm whether or not accessing the database is mandatory.
• Document in the Medical Record—As with all other facets of treating and managing a patient’s care, all of the steps the provider takes to protect against, and prevent misuse of, prescription medications should be documented in the patient’s medical record. This will serve as one of the most important defenses against allegations of the pain management physician’s failure to prevent diversion and abuse of prescription medications.
In addition to the steps noted above, it is important that all providers consult their own state’s laws and regulations with respect to prescribing, especially as they relate to prescriptions for controlled substances.
The Break-Up
Sometimes, pain management physicians will find that despite all of the preventative measures they took to prevent abuse or diversion, the patient still shows signs that he or she is diverting or abusing the medications prescribed to him or her. Some reasons for terminating the relationship include: (1) the patient fails to comply with a Treatment Agreement or other terms set forth by the physician, (2) the patient is unreasonably demanding, and (3) the patient threatens the provider or staff.
When the issue of breaking up with a patient arises, concerns regarding patient abandonment also arise. Abandonment is defined as the termination of a professional relationship between the physician and patient at an unreasonable time and without giving the patient a chance to find a replacement. Mere termination of the relationship does not amount to abandonment. Abandonment may arise when the relationship is terminated at a critical stage of the treatment, without good reason or sufficient notice and the patient was injured as a result.
To properly terminate the relationship, physicians including pain medicine specialists should take the following steps:
• Giving appropriate written notice;
• Giving a brief explanation of the reasons for the termination of the relationship;
• Agreeing to continue to provide treatment and access to services for a reasonable period of time (e.g., 30 days) to allow the patient to secure care from another person;
• Providing resources and/or recommendations to help a patient locate another physician of like specialty; and
• Offering to transfer the patient’s records to a designated person.
Of course, it is important to recognize that some states may have laws that specifically define abandonment and set forth a process that must be followed to ensure terminated patients are not abandoned.
According to the DEA, in 2006, more than 6 million Americans were abusing prescription drugs—exceeding the number of Americans abusing cocaine, heroin, hallucinogens and inhalants, combined. Thus it is with great fervor that both State and Federal agencies have turned their attention to preventing diversion and abuse of controlled substances. That is why pain management physicians must be aware of preventative steps they can take to prevent abuse and diversion of prescription drugs as well as know their legal rights when treating a patient who has turned south, leaving the physician with little choice but to break up.
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Neda M. Ryan, Esq. is an associate with Clark Hill, PLC in the firm’s Birmingham, MI office. Ms. Ryan practices in all areas of health care law, assisting clients with transactional and corporate matters; representing providers and suppliers in health care litigation matters; providing counsel regarding compliance and reimbursement matters; and representing providers and suppliers in health care litigation matters; providing counsel  regarding compliance and reimbursement matters; and representing providers and suppliers in third party payer audit appeals. She can be reached at (248) 998-5884 or at nryan@clarkhill.com
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