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by Chris Burns, President, EA Health

Hospital executives are well aware of the obligations imposed on their facilities by EMTALA, the Emergency Medical Treatment and Active Labor Act passed in 1986. This statute applies to any hospital participating in the Medicare program and basically states that a patient presenting to a hospital’s emergency department with an emergent medical condition and who is unable to pay may not be treated any differently than a patient with health insurance.

The primary objective of EMTALA is non-discrimination – to prevent hospitals from rejecting, refusing to treat, or transferring unstable patients to other facilities because they are unable to pay or are covered under Medicare or Medicaid.

CMS Call Panel Obligation

EMTALA itself imposes no official requirement on hospitals to maintain a call schedule; however that obligation is imposed on them by another section of the Medicare statute. More importantly, EMTALA does not specifically require physicians to serve on call panels, though they are often told that it does. Instead, the hospital’s medical staff bylaws normally impose this obligation on physicians as a condition for granting them medical staff privileges.

Current regulations state CMS will consider “all relevant factors” when determining whether a hospital is in compliance with requirements in maintaining its call schedule. It is generally understood that any specialty service that a hospital offers should be available through on-call physicians covering that service, although some exceptions do exist.

So, now that we have clarified the call panel obligation imposed upon hospitals by CMS, how do we go about satisfying it in the most cost-effective way?

The Old Way

Hospitals have traditionally relied on daily stipends to compensate specialists for taking call. Unfortunately, stipends are rising about 14% a year according to recent national surveys by MGMA. As a result, stipends have become a very expensive way for most hospitals to maintain their call panels and meet their obligations.

Why are stipends rising so much? Our research suggests that:

  1. fewer specialists see taking call as a pathway to growing their practice in the age of managed care,
  2. the potential of encountering a very sick (and time-consuming) uninsured patient while on call far exceeds the limited reimbursement available through a daily stipend,
  3. the volume of uninsured and under-insured patients represent too great a financial risk, and
  4. that the overall burden and inconvenience of taking call is disproportionate to the stipend compensation offered.

In response, hospitals have had to continue raising daily stipend amounts to offset these factors and attract a sufficient number of specialists to take call.

The Alternative

There is another way to pay physicians to take call. Rather than rely solely on a stipend to address all of the risk factors associated with taking call, divide the risks into two categories – burden/inconvenience and work-related – then match the appropriate type of compensation to the specific risk factors in each category.

For the burden and inconvenience of being on call, a modest daily stipend is warranted and justifiable. However, for the actual medical services performed when on call, adding a fee-for-service component to supplement call reimbursement can rejuvenate call panel support among your medical staff. In most cases, we recommend limiting fee-for-service payments to unassigned and uninsured or under-insured patients to keep program expenses within reason.

By eliminating the financial risks of treating uninsured and under-insured patients, you eliminate two of the primary drivers of escalating stipend costs – namely the “train wreck” patient and the hospital’s payer mix. As evidence of this, our data reveals that the majority of our client hospitals using this blended call compensation approach experienced only a 1-2% increase in stipend expense growth over the last 10 years compared to the 14% growth rate cited previously.

If a full-fledged fee-for-service program seems too ambitious for your budget, incorporating activation payments or transfer payments can help mitigate physician risk and increase support for highly-impacted specialties. In other cases, consolidating the call panel opportunity for a particular specialty across multiple facilities (aka “system-wide” or “regional” call) and seeking bids from competing single-specialty medical groups may produce reduced stipend rates in exchange for increased volume to the winning bidder.

The Takeaway

Medicare regulations impose a call schedule obligation upon hospitals, yet hospitals are left to their own devices to enlist the support of specialists to help them meet that obligation. While stipends are effective, they’re also expensive. Adding a fee-for-service component for unassigned patients is a cost-effective way to incentivize call panel participation and keep stipend expense growth in check.

break the stipend cycle

Our performance-based approach provides hospitals with a cost-effective alternative to the rising costs of stipends, while simultaneously reducing compliance risks. Schedule a consultation today to get started.

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