The document discusses the Obama administration's initiative to transition Medicare payments away from traditional fee-for-service models and toward alternative payment models that make providers financially responsible for quality outcomes. It argues that this transition is important for bending the health care cost curve in a politically acceptable way. The author then outlines several key success factors for providers to successfully transition to alternative payment models based on their 25 years of experience, including the robust use of accurate data, a willingness to review medical records to ensure data integrity, an ongoing commitment to changing practice patterns, and understanding how to effectively communicate the need for change to both practitioners and organizational leaders who fund health care.

1. While the media focuses on whether the insurance mandates dictated by ObamaCare will
survive legal challenges, the Obama administration has embarked on an initiative of much
greater significance--having 30 percent of all Medicare fee-for-service payments made via
alternative payment models by 2016 and 50 percent by 2018. This trend toward replacing fee-
for-service (FFS) medicine with “value” based alternatives—prepayment ranging from case
rates to full at-risk capitation—appears to have momentum. There is a growing belief that
making the providers of care financially responsible for achieving quality outcomes is the
optimal way to bend the health care cost curve in a politically acceptable manner.
Transforming physician behavior is central to achieving lasting changes to practice patterns as
risk for outcomes shifts from payors to providers. Because physicians have learned how to be
prosperous in a fee-for-service model, it takes a focused process to have them understand how
their approach to patient care needs to be modified to have success in an at-risk environment.
I have spent the entirety of my 25 years as a managed care administrative professional working
to establish the linkages necessary for meaningful change to occur: linkages between primary
care and specialty physicians; between physicians and hospitals; and between providers of care
and payors to achieve success in a prepaid at-risk environment. Some of the key success
factors include:
--Robust use of data: While opinion abounds, there is just one set of facts; getting the data to
be both accurate and granular enough to be meaningful can be challenging but once achieved,
I’ve found physicians to be both responsive and motivated. Credibility, however, will be fleeting
if the data can be shown to be lacking in integrity
--Willingness to go the medical record: Because data integrity forms the backbone of the trust
necessary to achieve meaningful change, a review of the basis for the summary data may be
necessary which requires reviewing actual patient charts in a positive, constructive and neutral
environment that allows for a consensus to develop about past events in a non-punitive, non-
accusatory context. Only physicians can play a meaningful role in this process.
--Commitment to the process: Changing practice patterns, similar to managing a chronic
disease, is not effected through a one-time training session or lecture. It requires ongoing
development during which the first two steps outlined above are repeated until physicians own
the outcomes. While intensive, the end result is the creation of physician champions who can
then both convert new physician participants as well as ensure that progress is steadily
achieved.
--Ability to know your audience: Change needs to be sold not only to the practitioners of health
care but to the Directors of the organizations that fund it. In many cases, these Directors are by
law lay people who may not be steeped in the complexities of health care delivery and

2. financing. Having spent 25 years addressing this group of influential stakeholders, I’ve learned
that a cogent presentation making logical arguments will get and keep their attention.
Overwhelming them with medical and industry jargon is a non-starter.
If your organization or client is considering or embarking on the journey from FFS payment to
some form of at-risk or value based compensation and needs guidance from a physician who
has a proven track record for assisting in the transition, please do not hesitate to contact me.
Lowell Gordon MD, MBA
505.660.7197
Lowellg86@gmail.com