Key Messages: Clinical Chairs Committee Meetings

March 2018

This meeting was held in Closed Executive Session.


April 2018

UPG President Bobby Chhabra, M.D. chaired the meeting, opening with remarks thanking chairs for their diligent efforts to resolve the budget deficit for FY19.

Ms. Rumsey presented Financial Results through February 2018, and Operations Results through March 2018. The Consolidated Balance Sheet shows no change in Total Assets and a 2% negative change in Total Net Assets which reflects an operating loss of $17.0M through February, offset by market gains of $15.2M. The Consolidated Income Statement shows a 3% decrease in total revenue relative to budget, and a 2% increase from prior year. Total expenses show a 2% decrease relative to budget and a 4% increase from prior year. Contributions to the School of Medicine are 8% over prior year, which includes a $2M endowment transfer. Ms. Rumsey explained the UPG Administrative Fee Structure, noting that the 8.25% rate on Collections would be reduced to 8.0% effective July 1, 2018. Expectation is that this will reduce the overall weighted collection fee (after discounts) from 7.7% to 7.45%. FY18 YTD Workload March results are 0.6% over budget. However, the FY18 budget did not contemplate a change in CRNA billing to Medicare; adjusting for that change, WRVUs are 0.7% below budget through March FY18 YTD Patient Collections are 0.9% above prior year and 2.7% below budget. After adjusting for $3.6M overstatement of FY18 budget, Patient Collections are 1.1% below budget.  Days in AR remains below 40 days, ending March at 39.2 Days.

Click to Enlarge Image


Click to Enlarge Image

UPG Director of Audit and Billing Quality Robert Duggan and UPG Continuous Improvement Manager Luke Heneghan presented an update on the Continuous Improvement project with the Department of Surgery. In December 2017, three (3) focused Surgery Assistance teams were formed to review key department metrics in Process, Reporting and Denials. The goal was to conduct this review and build an assistance model to take to other departments, identifying corrections and deploying process improvements as quickly as possible. Mr. Duggan and Mr. Heneghan reviewed the status and deliverables of each of the three (3) teams and discussed next steps which include priority assistance to departments on a rolling basis based on top-side metrics. Department of Surgery Chair Martha Zeiger, M.D. complimented the work and the team on this project, noting that many improvements happened in real time. UPG has incorporated this work into its goals for the next fiscal year including scaling best practices across the clinical departments.

UPG COO Corey Feist presented an update on the UPG Cost Survey, developed and administered by UVA Center for Survey Research. The survey measured the following categories of questions: Size and structure of practice plan, services provided, fees for services and academic fees. It was distributed in January 2018 via Qualtrics and hard copy to 23 Academic Practice Plan Directors (APPD) members and saw a roughly 50% response rate. Next steps include analysis of raw data and follow-up conversations with respondents. Mr. Feist solicited volunteers to form a committee charged with reviewing the data and participating in follow-up calls.


An error was made in the February 2018 Clinical Chairs Committee Key Messages, in the section regarding Provider-Based Clinic Cost Allocation. The alternate (collection-based) methodology will begin in FY19.


May 2018

Ms. Southerland presented an overview of the proposed revisions to UPG bylaws. The intended aims of the revisions are to include representation from the UPG-employed Advanced Practice Provider population, and to rotate the opportunity for UPG BOD representation to all clinical chairs to enhance understanding of UPG operations and allow for greater engagement in the organizational structure.

Ms. Rumsey presented a Financial and Operations update, including information on Bad Debt and Indigent Care trends. FY2018TD April results show an inverse relationship between Indigent Care and Bad Debt, with Indigent Care 7.1% below prior year and Bad Debt 1.9% over prior year. Several issues have been identified around Financial Screening and Self Pay.

Mr. Feist presented an update on the Merit-Based Incentive Payment System (MIPS) results. MIPS participants receive a payment adjustment based on performance in four (4) categories: Quality, Cost, Improvement Activities and Advancing Care Information. UPG submitted documentation from patient records by the March 16 deadline to avoid potential penalty; a task which required manual extraction from approximately 4,500 patient chart reviews. Final performance scores will be reported in July, and used in determining the annual increase.

Mr. Feist presented an update on the CMS Open Payments Program, which collects information about the payments drug and device companies make to physicians and teaching hospitals. Types of payments include consulting fees, compensation for services other than consulting, honoraria, gifts, entertainment, food & beverage, and travel & lodging. Chairs were requested to review the CMS online draft report by May 15; the final draft of which would be published in June.

Key Messages: UPG Board of Directors Meetings

March 15, 2018

A request was made that the UPG Board of Directors receive an assessment of UPG cybersecurity efforts and liability protection in the event of a data breach.

UPG President Bobby Chhabra, M.D. made opening leadership remarks, noting the increased unity and collaboration of department chairs that he had observed during his first six (6) months in the role of UPG President.

UPG CEO Brad Haws, UVA Chief HR Officer Kelley Stuck and UPG General Counsel Mary Frances Southerland presented an update on Ufirst. The benefits of an integrated delivery model include better value and experience for clinical faculty, as well as additional near-term benefits such as the ability to influence Workday technology, visibility into employee relations cases via ERIS, access to larger data sets and dedicated time and professional development curriculum for Business Partners. A collaborative effort is underway to develop metrics for Service Level Expectations which measure meaningful data. Ms. Kelley expressed gratitude for the UPG HR team’s diligent efforts to bring about understanding of unique aspects of the organization.

Ms. Southerland reviewed the ongoing efforts underway in partnership with the University General Counsel’s office to ensure proper protections of UPG’s independent state as well as proprietary data. Ms. Southerland also reviewed the contract term and termination agreement provisions which allow for an initial two (2) year term, with automatic renewals unless the parties are unable to reach a mutual agreement regarding the scope of services and corresponding rates.

The resolution to approve this integration of HR Services was approved unanimously, with a requested additional amendment stating that approval is subject to legal opinion by UPG outside counsel that issues related to UPG’s independence as a 501(c)3 foundation are addressed and in no way compromised by the agreement.

UVA Associate Vice President and Treasurer Jim Matteo presented an overview of the process of Enterprise Risk Management (ERM) at UVA and the Health System, the purpose of which is to create, protect and enhance value by proactively managing emerging uncertainties that could either negatively or positively influence achievement of the organization’s objectives. Mr. Marquardt identified ERM Key Risks and Management Plans for UVA Health System, as had been communicated to the Health System Board of Directors and will continue to be communicated to the UVA Health System Board on a quarterly basis.

Mr. Lishke reviewed both the projected and actual financial impact of Health System headwinds by category, as well as FY18 operating income projection pressures and management response. Mr. Feist reviewed the UPG-specific annual impact of the same financial headwinds by category.

Dr. Shenkir introduced a resolution to engage audit firm BDO for the next three (3) fiscal years. The motion was seconded, and passed unanimously.

Ms. Rumsey presented an FY18 Financial and Operations and Investments update through February 2018 including Consolidated Income Statement, Consolidated Balance Sheet and Investment Results, as well as a status update on FY19 clinical department budgets and their deficit drivers.

Ms. Rumsey presented an Epic Revenue Cycle Implementation Status Update. Issues that have been identified and resolved with regard to revenue generation include scheduling templates, unscheduled referrals and orders to schedule, and reporting across Epic modules. Issued that have been identified and resolved with regard to revenue collectability include a financial screening at the time of service, billing new charges to an existing indigent account, adding financial aid after billing, Medicaid real time eligibility returning incorrect dates, and the Medicare secondary payer questionnaire directing claims to incorrect payer. Current metrics show that UVA continues to perform above average in some areas while below average in others. Metrics continue to be analyzed regularly.


June 14, 2018

UPG CFO Susan Rumsey provided a Financial and Operations update for FY18. The income statement demonstrates $13.1M operating margin before contributions of $32.4M to the School of Medicine. The balance sheet shows a decrease in net assets which reflects an operating loss of $19.3M through May. Investment results demonstrate that the pension plans are well funded. Due to lower than desired performance, investments will be divested from Wells Fargo and moved to UVIMCO. Workload trends indicate that May was a very strong month in terms of both patient volumes and collections, with the highest recorded collections in the history of UPG. Revenue cycle challenges due to Epic implementation continue.

Ms. Rumsey introduced the FY19 UPG Budget Proposal including major initiatives, assumptions and risks. Academic expenses continue to be anticipated in the financials. Efforts are underway to develop mission-based financial statements so these expenses may be reflected in the School of Medicine financials. The Consolidated UPG Budget shows a strong positive operating margin, which is sufficient to cover the entire pension expense. The primary drivers of the UPG margin are clinical departments and unallocated pension expense in other units. The clinical operating margin allows support of the academic mission. After discussion and questions regarding clinical funds flow, a motion to approve the consolidated budget was passed unanimously. Mr. McLaughlin expressed concern on behalf of the Finance Committee with regard to the budget being aggressive. A motion was made, seconded and passed unanimously to approve the Group Practice Fund Budget.

UPG General Counsel Mary Frances Southerland presented the UPG Proposed Bylaws Revisions, and the associated aims and procedural requirements of the revisions. The revisions include the creation of an Advanced Practice Provider Director, increasing the number of Public Directors by one (1) in order to maintain the Public Director majority, having five (5) At-Large Physician Directors (2 Non-Chairs, 3 Chairs) and clean-up of language regarding Director removal. A motion was made and approved to adopt the following resolution based on written consent via electronic vote, after the requisite 2-weeks notice.

UPB Board Chair Dr. Kate Acuff brought to the attention of the group that this was to be the last UPG Board of Directors Meeting during Bradley Haws’ tenure as CEO, and commended his dedication to the organization as a servant leader throughout his 14 years with the Foundation.

The remainder of the meeting was spent in Closed Executive Session.


Key Messages: February 2018 Clinical Chairs Committee Meeting

UPG COO Corey Feist presented an update on contract negotiations with Anthem. Department Chairs approved proposed contract terms as outlined. Next steps include reevaluation of current Super Specialty Codes, as well as reconstituting/charging the Performance Based Contracting Team.

UPG CFO Susan Rumsey reviewed Provider-Based Clinic Cost Allocation. The current methodology distributes funds to each unit proportional to indigent care RVUs. The alternate methodology would have funds allocated to units based on their individual ratio of cost to charges applied to indigent volumes. A motion was made and approved to adopt the alternate methodology for the last six (6) months of FY18, and beginning in full for FY19.

UPG President Bobby Chhabra, M.D. distributed a handout of questions from the UPG Cost Survey. The survey was administered by the UVA Center for Survey Research to 23 Association of American Medical Colleges (AAMC) peer institutions. The survey was designed and administered as part of ongoing efforts to discover best practices and promote understanding of UPG’s comparative cost structure. Results are expected in Spring 2018.

The remainder of the meeting was spent in Closed Executive Session focused on discussing the Group Practice Model.

What UPG Providers Need to Know about MACRA

Last month we shared the following 4 facts regarding MACRA, relevant to UPG providers:

  1. Under MACRA, there are two reimbursement structures: MIPS (Merit Based Incentive Payment System) and APMs (Alternative Payment Models). Because we are in a fee for service environment, we qualify for the MIPS structure —  not APMs — as the APM track requires that participating organizations bear substantial risk (among other qualifications) and UPG does not currently have any at-risk contracts.
  2. All UPG clinicians benefit from the fact that UPG is a large organization with over 1,000 providers. We report our performance measures as a group practice, and our MIPS Composite Performance Score is calculated as such. Providers most at risk for penalization under MIPS regulations are solo practitioners (primary care and specialists) and small groups. UPG providers do not face such risk.
  3. While penalization isn’t an immediate concern, as we look to the future and the MIPS requirements become more stringent we will need to focus efforts on performance measures:
      • Quality
      • Cost/Resource Use
      • Clinical Improvement Activities
      • Advancing Care Information
  4. Physicians can contribute individually to group performance by:
      • Thorough documentation of patient care
      • Diligent management of screening, managing and monitoring patient conditions
      • Providing input as necessary with regard to EHR system technology


  • The MIPS reporting deadline for Web Interface reporting of Quality measures for the 2017 reporting year is March 16, 2018. UPG currently has staff members working to abstract pertinent data from individual patient records. This abstraction involves reviewing a minimum of 3,472 specific Medicare beneficiary charts for reporting particular data elements related to 14 quality measures. Once the data is abstracted, it is uploaded to the CMS Quality Payment Program website and added to our score calculation for the MIPS program.
  • Data relating to Advancing Care Information and Clinical Improvement Activities has also been entered into the portal and will contribute to UPG’s overall score in the program.


  • How are scores calculated?
    •  Each performance measure category has a different weight, and relative weighting will change over time. Together, these determine the MIPS Composite Performance Score (CPS).
    • Composite Performance Scores are compared to a Performance Threshold (PT) to be determined by CMS each year.

Click to Enlarge Image


  • How are penalties and bonuses determined?
    • Non-participation results in a 4% penalty for the 2017 reporting year. Partial to full participation results in increasing bonus potential.
    • UPG is submitting a full year of 2017 data.

Click to Enlarge Image

    • Participants that fall above the PT receive bonuses (i.e. a positive payment adjustment to their future Medicare Part B reimbursement rate). Those that fall below the PT face penalties (i.e. a negative payment adjustment).
    • The further the Composite Performance Score is above or below the PT,the potential for reward or penalty increases.


  • What results can UPG providers expect?
    • UPG providers can expect to successfully exceed the PT this reporting year, but specifics cannot be accurately estimated as they are based on comparative performance.

This article provides some history and context for MACRA. We hope that you find it informative. As you read, please keep in mind that we qualify for MIPS structure – not APMs.

Please don’t hesitate to reach out with any questions or concerns, or if you seek further clarification:

Lean Management Success: UPG Fee Reduction

UPG strives to serve as an efficient steward of resources by providing high quality, specialized services in a cost effective manner. A vital part of this effort lies in the Lean management practices which have been implemented across all UPG units, and have generated significant value for the Health System for the past several years. We are proud to be a Health System leader in Lean processes.

Among other Lean management accomplishments, UPG has exercised extreme diligence with regard to replacing prominent positions when vacated. We have been able to manage FTEs by attrition, using existing resources when possible to fulfill necessary duties.

One of the benefits that is being realized as a result of ongoing UPG Lean management efforts is a reduction in the collection fee from 8.25% to 8.0%, effective FY19. This reduction translates to a $750,000 savings to clinical units, bringing the aggregate value of UPG Lean practices for the Health System to over $3M to date.

We are pleased to share this development.