Attributed to Jonathon Low (from the blog “Lowdown”)
A Partner and Co-Founder of Predictiv and PredictivAsia, Jon specializes in management performance and organizational effectiveness for both domestic and international clients. He is an editor and author whose works include Invisible Advantage: How Intangilbles are Driving Business Performance.
“Medicare Starts to Tie Doctors' Pay to Quality and Cost
For all the data collected about medical care and health, the relationship between expenditures and results in the US remains stubbornly disconnected.”
Reimbursement from Medicare is going to become tricky with the imminent calculations regarding outcomes for your patients in your geographic location.
It appears that not only will your outcomes affect your income, but the outcomes of your referring and referral providers will affect your practice income.
Jordan Rau (Washington Post) writes, “Making providers routinely pay attention to cost and quality is widely viewed as crucial if the country is going to rein in its health-care spending, which amounts to more than $2.5 trillion a year. It’s also key to keeping Medicare solvent. Efforts have begun to change the way Medicare pays hospitals, doctors and other providers who agree to work together in new alliances known as “accountable care organizations.” This fall, the federal health program for 47 million seniors and disabled people also is adjusting hospital payments based on quality of care, and it plans to take cost into account as early as next year.”
“Twenty-thousand physicians in four Midwest states received a glimpse into their financial future last month. Landing in their e-mail inboxes were links to reports from Medicare showing the amount their patients cost on average as well as the quality of the care they provided. The reports also showed how Medicare spending on each doctor’s patients compared with their peers in Kansas, Iowa, Missouri and Nebraska.”
“Efforts have begun to change the way Medicare pays hospitals, doctors and other providers who agree to work together in new alliances known as “accountable care organizations.” This fall, the federal health program for 47 million seniors and disabled people also is adjusting hospital payments based on quality of care, and it plans to take cost into account as early as next year.
Applying these same precepts to doctors is much more difficult, experts agree. Doctors see far fewer patients than do hospitals, so making statistically accurate assessments of doctors’ care is much harder. Comparing specialists is tricky, since some focus on particular kinds of patients that tend to be more costly”
Dr. Michael Kitchell, a neurologist and chairman of the board at the McFarland Clinic in Ames, Iowa, one of the state’s biggest multi-specialist practices, predicted the Medicare reports “will be a huge surprise to almost every physician.” That’s because the calculations of how much those doctors’ patients cost Medicare include not just the services of the individual doctor but of all the doctors that provided any treatment to the patient. Kitchell said his patients saw on average 13 physicians besides himself.
“You’re a victim or a beneficiary of your medical neighborhood,” Kitchell said. “If the primary-care doctors are doing the preventative screening tests, you’ll get credit for that, but if you’re in a community where the community doctors are doing a poor job, you’re going to look bad.”
Providers organized into a multispecialty medical group and/or accountable care organizations will have an easier time than those in solo, practice, or single specialty groups. These practices may require a redesign They are at a distinct disadvantage caused by their local community provider network formal or informal. It ups the stakes as to who you receive referrals from or to whom you refer. The quality, efficiency and their outcomes will alter your reimbursement through incentives and/or penalties. (Note that the metrics are determined by CMS, not your neighboring providers or you.)
Dana Gelb Safran, who oversees quality measurement for Blue Cross Blue Shield of Massachusetts, says she doubts it will be possible for the government to judge individual doctors. She predicts CMS will ultimately have to find ways to evaluate doctors as parts of groups — either formal affiliations as part of group practices or informal affiliations among doctors who refer to each other.
If you were an auto mechanic your brake repairs might be compared to a body shop, or engine mechanic that also worked on the same vehicle. The brakes may be perfect, however your payment may be decreased by the condition or repairs on the rest of the vehicle
This may be an unprecedented change in payments for any services not only in health care but most industries.
Although the program is still being devised, it will become reality for many doctors starting in January, because CMS plans to base the 2015 bonuses or penalties on what happens to a doctor’s patients during 2013.
Medicare’s adoption of this approach would be “a game changer” in terms of making physicians directly accountable for costs, said Anders Gilberg, senior vice president at the Medical Group Management Association, which represents doctors groups. Medicare is “going to be shifting money from . . . physicians who are deemed to be high-cost relative to their peers to low-cost physicians. That’s going to create all kinds of new incentives in fee-for-service.”
Private insurers may follow Medicare’s lead, said Paul Ginsburg, president of the Center for Studying Health System Change, a Washington think tank. The formula Medicare ultimately designs to judge and pay doctors, Ginsburg said, could become “a valuable asset for private insurers, with a tool that will be somewhat bulletproof, that physicians won’t attack because they’ve been part of the process of developing them.”
“Patients are not behind this agenda. The public is very scared about managing costs.”