September 20, 2018 at 5:00 am ET
While there is bipartisan agreement in Washington that Medicare should lead the way in changing the way the nation pays for health care, the reality of late is not living up to the rhetoric.
Congress and three successive administrations have supported moving Medicare away from the current fee-for-service payment system, which pays providers based on their volume of services, to a system that pays them for the value of their services, as measured by quality and cost.
The Medicare Access and CHIP Reauthorization Act of 2015 was designed to accelerate this transition for physician payments by folding three different incentive programs into the Merit-based Incentive Payment System. In guidance and public comments before it promulgated rules on MACRA, the Centers for Medicare and Medicaid Services purported that the law would help achieve three goals for the health care system — better care, smarter spending and healthier people. The law seeks to achieve this by rewarding physicians who perform well in three key areas: payment incentives, care delivery and information sharing.
Unfortunately, the recent Quality Payment Program rules CMS proposed in July to implement MIPS will decelerate the transition — just when the country needs to move full speed ahead. CMS came up short on the bonus payments the law set to incent providers to invest in improved care.
This is disheartening news to medical groups such as Prevea Health, the multispecialty group I lead in Green Bay, Wisconsin, where we offer more than 60 medical specialties and employ about 350 providers and more than 2,000 employees.
Like many of the 450 groups and integrated systems in the American Medical Group Association, Prevea has invested millions of dollars in people and technology to improve care with the expectation that the Medicare payment adjustments would provide the return on our investment. The investments include better analytics to identify and address gaps in our patients’ care; new scheduling systems to simplify the process for our patients and providers; and a cadre of registered nurse care managers, who can manage appropriate cases at a third of the cost of those managed solely by physicians. Beyond Prevea, AMGA’s recent member survey indicates most are ready to accept the financial risk of value-based payments in general, but particularly under MACRA.
Now, in the third year of rulemaking, it is clear that CMS is not implementing the law as intended.
For example, the law provided for payment adjustment increases of up to 5 percent to be collected by top performers in 2020, based on their 2018 results. Conversely, poor performers could lose up to 5 percent.
But here’s the catch. These payment adjustments assume meaningful participation in the program. Since Congress designed the program to be budget-neutral, there can be no winners in excess of losers. In July, CMS excluded 58 percent of providers from MIPS 2019 performance requirements, so there isn’t enough money to reward high performers.
This effectively collapses the payment adjustment distribution curve. So in 2021, high performers are expected to receive a 2 percent adjustment, not the potential 7 percent promised by law.
This is short-sighted. If we want Medicare to successfully transition to value-based payment, we need more, not fewer, providers in the tent. I understand some may lack the resources to participate, but this transition has been a work in progress for years. MIPS is a continuation of other value-based programs — such as the Physician Quality Reporting System, Value-Based Payment Modifier, and Meaningful Use programs — none of which excluded providers from participation.
The lower payments will neither incentivize the required investments in health information technology and process changes, nor will they cover the costs and burdens associated with reporting the required data. Finally, they will not incentivize health care provider organizations to engage with CMS in moving toward value-based care.
Changing the Medicare payment system is an enormous undertaking. It requires changes in delivery, administration and finance, investments and culture. Prevea Health undertook this change because we viewed MACRA as the incentive program that would reward us for making these changes and doing well by our patients.
Now we are left to explain to our physicians and others that the investments we made are not being rewarded — that the better care we delivered is not being recognized. That is a difficult message to deliver. And unlike with our private insurance contracts, we have no recourse with Medicare. We can’t sue for breach of contract, and Medicare fixes our prices.
Congress passed MACRA to push the transition to value for physician payments. Ironically, by excluding the majority of clinicians from MIPS, we’ve taken a step back from this transition. These exclusions need to end. Only then can MACRA serve as the transition tool it was intended to be.
Ashok Rai, MD, is president and CEO of Prevea Health and serves as board chair of the American Medical Group Association, an Alexandria, Va.-based association representing multispecialty medical groups and integrated systems of care.
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