Insights from Ludi

This is funny. (Well, if you are giant hospital nerd focused on broken processes, it’s funny.) Do you know what you are spending on your hospital administrative agreements with your physician partners? You have to know where they are located to start the count. You need to know your “official count” of partnerships (co management, call, employed, medical directorships to name a few.)

Do you know how many administrative physician agreementsyou have? Do you know what group took call last night? Do you know who you are paying on auto-pay, how much, and why? How much do you spend annually on medical directorships? Are you chasing approvers to sign time logs on Friday Happy Hour so you don’t further antagonize your very important physician partner?

Who’s on first to quote Abbot and Costello…..hospital and health systems are notorious for having silos. We are witnesses to health systems acquiring other hospitals which continues to increase the silo effect and more layers of disconnect. With physician agreements, the complexity is intense and a gap for hospital operations.

There's an overwhelming amount of data in the most recent U.S. Cost Report. For your convenience, we broke it down to highlight three insights that reveal the opportunity for hospitals to capture additional revenue.

Medical directorships are necessary for the effective management of patient care. However, medical directorship payments can cause headaches for hospital administrators.

Duties are most often outlined in the agreements, however because they are so complex, they become impossible to manage over time. Many agreements include duties that are paid at different rates depending on holiday, weekend or weekday hours. Some duties can be paid quarterly, while others are paid monthly. One agreement with a series of payment amounts and payment timeframes can be detrimental to making accurate payments.

Physician administrative agreements are such a critical part of hospital strategy. The challenge with these agreements is they live in a variety of departments where each department manages them differently which can be cause for manual process and leave large opportunity for error. With automation comes concrete process across all silos of physician contracts as well as ownership of the problem.

Administrative physician agreements have been written for your physicians with help from your legal department or counsel. The clauses are there to be followed for numerous reasons. Perhaps it is to meet your organization’s goals with the way you align with doctors as well as for a variety of compliance reasons. Whatever the reason, it’s important to handle your physician agreements in the way they’re written, even if they’re complex. Failure to do so leaves room for incredible consequences that can affect your organization in a variety of ways.

Finding a ‘foolproof’ process to manage physician agreements can be a greater challenge than anticipated – perhaps so much so that it's often a task that’s put off within the organization. Once you make the decision to better manage physician agreements, there are a number of advantages you can expect to gain throughout the organization. Here’s a 30,000 foot view of changes you will see once you put time and energy into this problem by automating.

Physician agreements are complex with tremendous detail around how the relationship will be governed, what duties are included and how compensation will work. While most organizations are quite proficient in the setup of these agreements, few are very good at managing the complexities of the agreement after they are executed.

Hospital finance and accounts payable teams have a tremendous amount of pressure and responsibility placed on their physician payment processes. They have to follow accounting procedures, operational and financial hospital workflows, and keep track of what they do for perpetual audits.