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Medicare payment shift didn't curb outlays: study


By Melanie Evans
Posted: November 26, 2012 - 5:15 pm ET
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Medicare spent more on primary care and specialty physicians in the year after a 2010 policy change that eliminated more-costly consultation payments but raised pay for office visits, a newly released analysis shows.

The increased office-visit pay—which remained lower by 16% to 61% than the discontinued consultation payments—nonetheless accounted for about two-thirds of the roughly 6.5% increase in spending that year after the policy change, according to the research, which was published online by the Archives of Internal Medicine. An increase in the reported complexity of patients accounted for the rest of the growth.

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“Our results suggest that the policy did not achieve its goal of budget neutrality in the first year,” the researchers wrote. “However, it did appear to narrow the gap in Medicare payments for office encounters between” primary-care physicians and specialists. Specialists more often billed using the discontinued consultation payments.

The volume of patient visits did not change, the report said. More office visits may be unattractive to specialists who get paid less for an office visit compared with other services. “Any pressure to increase volume may have been directed to other, perhaps more profitable, services,” the report said. The increase in reported patient complexity may have also accounted for the steady volume. Or doctors may lack capacity for new patients. “Thus, it would be difficult to increase the number of visits without working longer hours or shortening the length of visits, and shorter visits would earn a lower fee,” the researchers wrote.

The study analyzed data for 2.2 million people with Medicare supplemental insurance from a large employer between 2007 and 2010. Researchers included only those with diabetes or heart disease diagnoses or prescriptions. The study, which was funded by the Commonwealth Fund, excluded those with managed-care or capitated insurance plans.

Primary-care doctors accounted for more than half (58%) of the spending growth; specialists received the rest.


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