Nearly everyone in healthcare is toasting what looks like the imminent repeal and replacement of the hated sustainable growth-rate formula for Medicare payment. But as Sarah Kliff astutely points out this week in Vox, major questions loom about how exactly the new physician payment system will work, and whether it will accurately peg higher payments to higher quality of care. Modern Healthcare editor Merrill Goozner raises similar questions in his new editorial.
The questions center on how physician performance will be measured, given the serious flaws in the quality metrics now being used. Similar problems have dogged Medicare's efforts to measure, reward, and penalize the performance of accountable care organizations.
“I'm very skeptical of this,” Dr. Robert Berenson, a veteran Medicare researcher at the Urban Institute, told Kliff. “It's really absurd that we don't have any measures for most doctors that can place a value on their performance.”
The new model for doctors establishes a two-track payment system in hopes of prodding them to move toward value-based payment models such as accountable care organizations and bundled payments, as Modern Healthcare's Paul Demko recently reported. Physicians who have at least 25% of their Medicare revenue tied to such payment models in 2019 will be eligible for 5% bonuses. That increases to 9% in 2022 and thereafter.
Payments would be adjusted based on performance in the new Merit-Based Incentive Payment System (MIPS), which would consolidate three current incentive programs: the Physician Quality Reporting System (PQRS), which provides incentives for physicians to report on the quality of care measures; the Value-Based Payment Modifier, which adjusts payment based on quality use of resources; and meaningful use of electronic health records.
The bill establishes a technical advisory committee to recommend physician-developed alternative payment models developed through an open-comment process. There are a whole other set of questions about how that process will work and the role of physician groups in setting parameters governing their own pay.
As Kliff points out, the legislation doesn't detail what quality measures will be used to determine whether doctors are providing quality care or not, or what counts as an alternative payment model. “This is all conceptual at this point,” John O'Shea, a senior fellow at the conservative Heritage Foundation told her. “We just don't know if we have good quality measures yet, and what are the right outcome measures.”
The doubts about the new model highlight the extreme difficulty implementing payment reforms that hold healthcare providers financially accountable for meeting cost and quality targets while retaining the fee-for-service system, which seems to be a political imperative at least for the time being.
As conservative health policy experts argue, it might be simpler to shift the whole Medicare program into a capitated, network-based Medicare Advantage model, where health plans and providers deliver care for enrolled populations on a fixed budget. The Advantage model has its own quality and cost issues, of course. But that shift may eventually happen, making the quest for a sustainable, high-performing fee-for-service payment model moot. For now, though, policymakers seem determined to fiddle with the complicated machinery of medical piecework.
