Public hospital MDs push back against pay tied to performance

New York City’s public hospitals are embarking on a bold experiment tying doctors’ pay to a patient’s care and health after they walk out the door. Now the union representing more than half of the 3,300 affected physicians is trying to slow down the process, saying it should have been consulted more and that too many questions loom.

So-called pay-for-performance, announced in January, has set off a firestorm of debate in the medical community and is being closely watched across the country. New York City is the nation’s largest public health system, and 16 hospitals and diagnostic/treatment centers are affected.

Under pay-for-performance — encouraged by the federal government under the Affordable Care Act — a portion of each doctor’s paycheck is linked to feedback from patients and other quality metrics, such as the number of hospital patients readmitted within 30 days.

Some doctors at Bellevue and other public medical centers run by the New York City Health and Hospitals Corporation are resisting city move to tie their paychecks to patients’ success. Photo: cuttlefish/Flickr

Over the course of the next three years, this agreement will reward doctors with as much as $59 million in incentive payments “for meeting the public hospitals system’s goals to improve patient care, efficiency, patient satisfaction and align with the new demands of healthcare reform,” according to the New York City Health and Hospitals Corporation (HHC). Salaries for public hospital doctors range from $140,000 for primary-care doctors to $400,000 for specialists.

At stake is an average of $5,959.60 in raises per doctor per year. Pay-for performance replaces a compensation system that in the past has given across-the-board raises to physicians.

Currently, doctors are paid based on the quantity of services they provide. But this model has also been criticized by those who argue that volume-based pay schemes lead to unnecessary testing and procedures that make health care more expensive. Pay-for-performance aims to counter those incentives with ones that encourage quality care — such as reduced emergency room wait times, improved communication between doctors and patients, and improved coordination of primary care services.

HHC operates 16 facilities across the five boroughs under contracts with its three affiliation groups: New York University School of Medicine, Mount Sinai School of Medicine and Physician Affiliate Group of New York. NYU provides doctors to Bellevue and Woodhull Hospitals, Gouverneur Health and Cumberland diagnostic/treatment centers, and Coler-Goldwater Specialty Hospital and Nursing Facility. Mount Sinai works with Elmhurst Hospital Center and Queens Hospital Center, while Physician Affiliate staffs Coney Island, Harlem, Lincoln, Metropolitan, Jacobi and North Central Bronx Hospitals, as well as the Renaissance, Belvis and Morrisania diagnostic/treatment centers.

One complication in these negotiations is that the affiliation groups — not HHC — are technically the employer of public-hospital doctors.

Doctors Council SEIU represents approximately 2,000 of the 3,300 doctors working in New York City’s public hospitals. Kevin Collins, the union’s chief of staff, says that the pay-for-performance agreement was forged solely between HHC and its affiliation groups. He asserts the union has repeatedly reached out to HHC to be involved in discussions but has been largely rebuffed; he said there has only been one meeting since then between the corporation and the union to discuss the pay issue.

“There was virtually no involvement by the union or members of the community about this agreement,” says Collins. “Doctors have had little to no input.”

Collins says the union is not necessarily opposed to pay-for-performance per se, but that it objects to the performance indicators in the agreement and to having been left out of the discussions that drew up the performance indicators in the first place. 

For its part, HHC says doctors have been instrumental in drafting the policy. Spokesperson Ana Marengo says the contracts and the pay-for-performance program were negotiated by and agreed to by the affiliation groups, which “are made up of physicians and represent physicians.” But Collins contends that the agreement was “between administrators,” and that, physicians or not, they did not properly consider the agreement from the point of view of the average public hospital doctor who will actually be affected by the new pay scheme.

The union’s executive director, Dr. Frank Proscia, says the union is seeking to renegotiate the agreement. He maintains doctors need to be able to respond as medically appropriate, not with an eye toward their next bonus.

Considering cost is important for both the hospital and the patient, says Dr. Proscia, who used to work as a psychiatrist at Queens Hospital Center, but he says that translating that into a performance indicator that doctors are expected to meet “gets in the way of the doctor-patient relationship.” He says doctors should be able to provide patients with appropriate, individualized care — and for some patients, that means readmission within 30 days. This is especially the case for patients in public hospitals, which are “safety nets,” catching the most marginalized and at-risk patients including the homeless, impoverished and mentally ill.

A study from Harvard School of Public Health analyzed data provided by 252 hospitals participating in a similar program, Medicare’s Premier Hospital Quality Incentive Demonstration. It found no evidence that the program improved 30-day mortality rates, a measure of whether patients survive their hospitalization.

“You can’t assume that a performance indicator is a panacea,” says Proscia. It “doesn’t mean you’ve improved patient care.”

In New York City, doctors in public hospitals make an average salary of $162,000, versus an average of $139,000 in private institutions. While those in public hospitals are better compensated, New York City doctors make less than their counterparts in the South or the Midwest.

“These doctors aren’t millionaires. These are people who choose to serve at public hospitals, and this a slap in the face,” Proscia said.

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