Chapter 5

Ambulatory Care
 Transition from Solo to Group
Practice: Began in 1960s
• Social and lifestyle changes
• Increasing diagnostic and therapeutic
information
• Medical specialization
• Medicare and other insurance
complexities
• Office technology costs and overhead
invited economies of scale opportunities
for sharing equipment and staff
 Group Practice Advantages
• After hours and vacation coverage
• Informal collegial consultation
• Informal system of peer review
• Shared office overhead expenses
(personnel and technology)
• By 2012, almost 2/3 of physicians in
group practices, ranging from 2–11
members
 Physician Private Practice vs.
Employment (1 of 2)
• In recent years, physicians choose
employment by hospitals over private
practice:
– American Hospital Association: Physicians
employed by hospitals increased 32% since
2000.
– 2014 survey reported: 21% of all physicians
in all specialties are employed by hospitals.
 Physician Private Practice vs.
Employment (2 of 2)
• Hospital employment advantages:
Freedom from:
– Reimbursement rate fluctuations
– Information technology requirements
– Malpractice insurance premiums
– Work/life balance demands
 Hospital Advantages of Physician
Employment
• Gain market share for admissions
• Guaranteed use of diagnostic testing,
other outpatient services
• Referrals to high-revenue specialty
services
• Position with physician networks for
health plan negotiations, care
coordination, quality monitoring, cost
containment
Hospitals Acquire Physician Practices

• Rapid acceleration in past decade for

population health management and
prepare for financial risk-based
reimbursement:
– Create networks for managed care
negotiations
– Coordinate care, monitor quality, manage
costs
– Practices may include other providers: nurses,
lab personnel, IT personnel, etc.
Integrated Ambulatory Care Models
• Patient-Centered Medical Home (PCMH): a
concept, not a geographic “place”
• Accountable Care Organization (ACO)
– Both seek remedies for service fragmentation:
piecework reimbursement, no reimbursement
for care coordination, ineffective/absent patient
links among/between multiple service
providers, service duplications, inadequate
data on patient outcomes
 Patient-Centered Medical Home (PCMH)

• Team-based care model led by a physician;

provides continuous, coordinated care
throughout a patient’s lifetime: links with other
professionals for preventive, acute and chronic
illness, and end-of-life assistance
• Organized in 2006, Patient-Centered Primary
Care Collaborative has 1,000+ member
organizations, e.g., primary care physicians,
insurers, government agencies, academia, others
• Evidence reports PCMHs reduce ED use,
hospitalizations, costs
 ACA Provisions Supporting the PCMH

• Expanded Medicaid eligibility

• Medicare and Medicaid payment increases for
primary care and designated preventive
services
• Funding to place primary care providers in
shortage areas
• Center for Medicare and Medicaid Innovation
testing new payment and delivery models, e.g.,
Comprehensive Primary Care (CPC) Initiative
 Transitions to PCMH
• Changing medical practice culture and
system changes from volume to value
• Substantial payment reforms
• Challenges to achieve patient engagement
• Technological challenges with IT and
information privacy
• PCMHs will be primary care provider
organizations for ACOs
 Accountable Care Organization
Definition
• Medicare program-based: Legally constituted,
not-for-profit state entity, including a governing
board of providers, suppliers, Medicare
beneficiaries
• Responsible for at least 5,000 Medicare
beneficiaries for 3 years
– Meet Medicare-established quality measures
– Payments combine fee-for-service with shared
savings, bonuses linked with quality standards
applicable to all ACO providers
 ACO Goals
• Link physicians, support providers, hospitals
into networks of patient-centered care
• Timely, appropriate, efficient care
• Avoid duplications, medical emergencies,
and hospitalizations
• Link increasing proportions of Medicare fee-
for-service payments to ACO-type models
over next few years
 Other Ambulatory Care
Practitioners
• Licensed professionals in independent
practice: solo or group, single or
multidisciplinary practices
– E.g., Dentists, podiatrists, psychologists,
optometrists, physical therapists, social
workers, nutritionists
• More about these practitioners in Ch. 7.
 Ambulatory Services of Hospitals
• 19th century: Remote “dispensaries” serving the
poorest; staffed by low-ranking physicians to earn
admitting privileges
• Clinics organized by human body (cardiology,
orthopedics, etc.) to support teaching; but lead to
patient fragmentation issues; EHRs may help resolve
• Today: Safety net; staffed by medical school faculty,
residents, advance practice nurses, physician
assistants, other professional personnel
• Contributed 45% of total hospital revenue in 2013
 Hospital Emergency Department
(ED) Services (1 of 2)
•Staffed, equipped for life-threatening illness and
injury; physicians, nurses, others
•136 million annual visits
•Community “safety nets”; EDs are primary portal
of hospital admissions for uninsured and publicly
insured patients
•Visit payments: 16% uninsured; 18.4% Medicare;
31.8% Medicaid or CHIP; 34.9% privately insured
 Hospital Emergency Services (2 of 2)
• Inappropriate use: 8%, ~10 million “non-
urgent” visits
– Patients’ self-assessment
– Physician referrals
– Immediate access
• “Crowding” resulted in “clinical observation
units” COUs: triage patients for 6–24 hrs. to
assess for admission*
*Go back to the slide deck of Mount Sinai/Beth Israel’s observation unit plans in
“Hospital” section of this course – these are ways to observe and release non-
emergent patients
 Freestanding Facilities
• Freestanding: non-hospital based facilities:
Owned, operated by hospitals, physician
groups, for-profit, not-for-profit entities,
corporate chains
– Urgent care centers
– Retail clinics
– Ambulatory surgery centers
– Federally qualified health centers (FQHC)
– Public health ambulatory services
– Not-for-profit agencies
 Urgent Care Centers
• Walk-in, extended hour access for acute illness
and injury care beyond scope/availability of
typical primary care practice or retail clinic
• Operate under licensed physician auspices
– 7,100+, 14,000 avg. annual visits per center
– Ownership is for-profit: Hospitals, physician groups,
corporations, others
– Primary care physicians, nurses, physician
assistants, ancillary services, e.g., lab and radiology
– Since 1997, American Board of Urgent Care
Medicine certifies primary care MDs in urgent care
– Payments: Insurance, cash, credit card
 Retail Clinics (1 of 2)
• First in 2000; Minneapolis/St. Paul grocery
stores; estimate of 2,400 retail sites by 2016;
10.5 million annual visits in 41 states and D.C.
– Operated in pharmacies and supermarkets
(CVS, Walgreens, Wal-Mart, Target, others)
– Staff: Physician assistants, nurse
practitioners; MDs available by phone
– Treat narrow scope of minor illnesses
 Retail Clinics (2 of 2)
• Strong insurer and employer acceptance
to lower costs; avoid EDs
• American Academy of Family Practice
Physicians recognizes need and
physician opportunities; opposes
expansion beyond minor illnesses
– Clinics may be components of PCMH and
ACO care networks
– Recognition of patient preferences
 Ambulatory Surgery Centers (1 of 2)
• Ambulatory surgery (AS) definition: Surgical and
non-surgical procedures performed on an
outpatient basis in a hospital or freestanding
center
• 1970s: Improved operative technologies
including anesthesia were primary drivers along
with reimbursement changes
• Physicians led development
• AS = 64.5%+ of all surgeries in hospitals
• Now, 6,000+ U.S. AS centers; 97% for-profit;
91% urban
 Ambulatory Surgery Centers (2 of 2)
• Ownership: 90% have physician ownership
interest
• Accreditation: Medicare, Joint Commission,
Association for Ambulatory Health Care;
American Association for the Accreditation
of Ambulatory Surgery Facilities; 43 states
and D.C. require licensure
• Physicians and patients endorse for
convenience, safety, and quality
 Federally Qualified Health Centers
(FQHCs) (1 of 2)
• 1960s: U.S. Office of Economic Opportunity; urban
and rural locations; multi-disciplinary,
comprehensive
• Aegis: Local health departments; part of not-for-
profit corporation; stand-alone not-for-profit
– Serve medically needy underserved
– Comprehensive services w/fees based on ability to
pay
– Sound clinical and financial management
– Governed by representative board of directors
• Staff: multi-disciplinary teams: physicians, nurse
practitioners, physician assistants, social workers,
dental providers, others
Federally Qualified Health Centers
(FQHCs) (2 of 2)
• Federal funding: Health Resources and
Services Administration
• 1,300 centers operate 9,000 sites; 22.8 million
patients in every state, D.C., and U.S. territories
• 50% of patients ethnic and minority groups;
28% uninsured; 47% Medicaid; 31% children
• Major expansions/renovations funded by ARRA,
ACA including PCMH for Medicare patients and
EHR pilot programs
Public Health Ambulatory Services
(1 of 4)

• Origins in charity and community responsibility

for needy; colonial period–1800s: almshouses
• State and local governments’ roles and public
health developments led to tax-supported
departments of health in late 19th and early 20th
centuries
• Public health success controlling childhood and
other communicable diseases yielded to
medical focus with resource shift from
prevention to treatment
Public Health Ambulatory Services
(2 of 4)

• New demands on public health to promote

healthy lifestyles, provide safety-net services,
expand regulatory oversight to medical
industries
• Today, public health services range across a
spectrum of city, county, state: immunizations,
well-baby care; smoking cessation; disease
screenings, education, personal services
through health centers
Public Health Ambulatory Services
(3 of 4)

• Current public health services range across a

spectrum of city, county, state: Immunizations,
well-baby care; tobacco control; disease
screenings, education, personal services
through health centers; infectious disease case-
finding and control
• Staffing: Physicians, nurses, aides, social
workers, sanitarians, educators, community
health workers, support staff
Public Health Ambulatory Services
(4 of 4)

• 2013 NACCHO, National Survey of Local

Health Departments (2,107 of 2,565
responses [82%])
• Most common ambulatory services
– 90%: Adult and child immunizations
– 83%: TB screening; 76% TB treatment
– 64%: STD screening; 60% STD treatment
– 55%: Family planning
• Many challenges, esp. constrained
resources
 Not-for-Profit Agency Ambulatory
Services (1 of 2)
• Cause-related missions; incorporated by
states; exempt from federal tax
• Governed by unpaid, volunteer boards of
directors; stand-alone or affiliated with
national organizations
• Education, counseling, medical care,
advocacy
– Examples: Planned Parenthood, Alzheimer’s
Association
 Not-for-Profit Agency Ambulatory
Services (2 of 2)
• Funding: Government and private
foundation grants, private donations,
Medicare, Medicaid, private insurance,
sliding fee scale
• Repositories of community values and
charity, fill gaps for special need
populations and advocacy
 Tele-health
• “A collection of means or methods for enhancing health
care, public health, and health education delivery and
support using telecommunications technologies”
– Provides care in remote locations
– Connects homebound patients with providers
• Slow adoption due to definition for insurance billing ;
insurer support increasing due to patient demand and
potential cost savings
• However, there is huge potential and expect tele-health
market to increase exponentially in the next decade.
 Continued Future Expansion and
Experimentation
• Focus shifted from hospitals to freestanding
facilities.
• Medical advances, cost-reduction initiatives,
patient demands will drive continued
ambulatory growth.
• PCMH, ACO models’ study findings will inform
practitioners and policymakers about future
refinements to improve quality and patient
satisfaction and reduce costs.