A new CMS-led, pay-for-performance initiative coordinated at the state level by individual quality improvement organizations could attract 800 small to medium-size physician practices with payouts of up to $50,000 per year.
Doctors' offices in Arkansas, California, Massachusetts and Utah are eligible to participate in the Medicare Care Management Performance Demonstration, as long as they see at least 50 fee-for-service Medicare beneficiaries annually.
Under the initiative, physicians would submit annual data on 26 quality measures related to the care of patients with diabetes, congestive heart failure and coronary artery disease. Certain preventive services, such as cancer screenings and immunizations would also be tracked.
The financial payoff could be significant for doctors. Ricky Dyson, business director at the five-provider Riverton (Utah) Family Health Center, said that while more favorable outcomes for the patient are always the goal, the overwhelming factor behind his participation is simple: "Money, money, money." Dyson, who manages the family practice south of Salt Lake City, said the dollar amount is critical for family practitioners who have seen the short end of reimbursements despite providing a majority of care to U.S. patients.
"The major cost of medical care in America is really in the hospitals. They're squeezing the wrong end of the sponge here," Dyson said. "We have to do all sorts of things -- all sorts of tricks -- to reduce our costs and be able to run the place profitably and to pay everybody."
In March, Riverton Family purchased an electronic medical-records system. According to Dyson, the net effect has been that the office now gets paid much more quickly. Also, it has lowered costs in terms of how much support staff that office has to carry.
But the upfront costs were a heavy hit for the small office, he said.
Dyson said he is "somewhat skeptical" of the actual pay-for-performance demonstration, but the benefits -- both financially and in terms of quality -- are impossible to ignore.
Sharon Donnelly, healthcare redesign and health information technology lead at HealthInsight, Utah's QIO, said roughly 150 small to medium-size physician offices are expected to participate. Close to half of the state's smaller shops -- those with fewer than 10 physicians -- are expected to sign on, she said.
Rural sites, however, are likely to be excluded from the project because their billing information differs from other types of clinics, Donnelly said. Larger clinics are also expected to be sidelined. The CMS "really felt like if the clinic was larger, they would have the administrative capacity and would more likely have the funds to do this on their own," she said, adding that the program is designed to "help a small provider do things they may not be able to do on their own."
Rounding out the pilot program, 150 more hospitals in Arkansas are expected to join, as well as another 250 each in Massachusetts and California. Donnelly said the pay-for-performance program will be based on procedures conducted between July 2007 and June 2008.
"The ability to be able to look at outcomes and everything is great and everybody loves it on a theoretical basis, and certainly that's something good for patient care," Dyson said. "In the end, I gotta run a business, and an extra $10,000 a year is a big deal for us."