Posts Tagged ‘health care reform’

Payment Reform recap: Demonstrating value

Following the most basic model for success in business means minimizing overhead and maximizing revenues, Dr. Mark Laitos pointed out at TAFP’s Payment Reform Summit last Saturday. For doctors in private practice and other health care providers, this means billing for as many relative value units, or RVUs, as possible at the best conversion rate, and maximizing ancillary revenue, when possible.

And while this strategy is simple enough, Laitos said it has reduced the “proud field” of medicine to “conveyor belt medicine.” Worse, as payers – including health insurers, employers, and patients to some extent – strive to minimize RVUs, the solution to the cost crisis in a fee-for-service system is to slash payment to physicians and deny care to patients.

Of course neither patients nor doctors (nor the organizations that advocate for them) would allow this to happen considering the scale needed to rein in escalating health care costs. The solution, then, as speaker after speaker suggested, is to trade the volume-based model for a value-based model. This is also the cover story of the latest Texas Family Physician magazine.

Dr. Laitos was the first to bring up the triple aim – three things a health system should strive to do: improve the health of the population, improve the patient experience of care, and reduce the per capita costs of care. This Health Affairs article goes into more depth, but it sounds a lot like the concept behind accountable care organizations – that care should be primary care-based, consider population health, empower patients, and integrate with other care providers on a macro level.

Dr. Eduardo Sanchez, a family physician and medical director of Blue Cross and Blue Shield of Texas agreed on two points, referencing a still-amorphous “virtual medical community” that aims to connect smaller practices currently organized as “onesies, twosies, and foursies” by providing them with a platform for information exchange and management.

He also brought up BCBSTX’s Bridges To Excellence program as a way for physicians to be recognized as high-performing. “Physicians will have to be able to capture data, analyze that data, and have ability to adjust what those data reveal. BTE and PQRS [Physician Quality Reporting System] are not the answer, but they are a way to get started and learn how to manage the system for quality improvement.”

Dr. Chris Crow of Plano, another speaker at the summit, asserted his strong belief in using data and analytics to measure quality and costs; he’s used it in his practice to provide better, more efficient, and more cost-effective care, and he can demonstrate this through real figures to any interested party. Dr. Crow said that once a physician has access to quality and cost measures, he or she can begin to implement changes to improve care services. Not knowing the metrics is like “driving a car without a dashboard.”

Dr. Laitos asserted that there will be winners and losers in health care reform. “The winners will be the doctors who know how to demonstrate value.”

To read more about the Payment Reform Summit, check out TAFP’s coverage published in last week’s QuickInfo e-newsletter. Also stay tuned for video recordings of the lectures to be published later this fall.

Share

Without investing in physician training, health care bill creates aims without the means

An important piece of legislation designed to improve quality and lower costs in our fractured and inefficient health care system has received a second chance in the Special Session after dying in the House when time ran out on the 82nd Texas Legislature. However, because of other actions taken by our legislators that defund primary care residency training and other programs to bolster the physician workforce now and in the future, Senate Bill 8’s laudable goals are left without the means to achieve them.

The overarching goal of S.B. 8 is to reverse the negative trend in our health care system, to bend the cost curve by testing and implementing various performance-based payment methods that provide incentives for improved patient outcomes. It achieves this through two key mechanisms: the creation of health care collaboratives and the creation of the Texas Institute of Health Care Quality and Efficiency.

As envisioned in the bill, health care collaboratives clinically integrate physicians, hospitals, diagnostic labs, imaging centers, and other health care providers, aligning financial incentives to keep patients healthy and out of the hospital and emergency room. They are designed to move the delivery system away from a fee-for-service based system—where physicians and hospitals are paid for quantity of services over quality—to one in which doctors, hospitals, and other providers are accountable for the overall care of the patient and the total cost of the care provided.

Mounting evidence supports improved outcomes and lower costs achieved through this type of coordinated care. It works because patients receive care from a medical team, led by a primary care physician, that integrates all aspects of preventive, acute, and chronic needs using the best available evidence and appropriate technology to ensure patients receive the right care, at the right time, in the right place, at the right value.

Equally as important is the Texas Institute of Health Care Quality and Efficiency, which provides a safe harbor from antitrust laws for hospitals, insurers, and physicians to experiment with alternative payment and delivery systems.

A dedicated institute emphasizes experimentation at the state and community level, further encouraging the testing of health care provider collaboration, health care delivery models, and coordination of health care services to improve health care quality, accountability, education, and contain costs in Texas. Through regulation and rulemaking, our state and its agencies can ultimately shape how reform occurs, and this legislation provides the necessary medium for trial and error, adjustment and adaptation.

It is no secret that Texas faces a severe physician shortage, especially among the primary care physicians who are uniquely trained to address a variety of disorders and chronic diseases across multiple organ systems. By 2015, Texas will need more than 4,500 additional primary care physicians and other providers to care for the state’s underserved population.

Over the past few sessions, the Texas Legislature has put in place several provisions designed to increase the number of primary care physicians in our state and to draw those physicians to the rural and underserved areas of the state that need them most. Our elected officials expanded primary care graduate medical education and training, implemented education loan repayments for primary care physicians, and supported medical student primary care preceptorships—each proven to make a positive impact on increasing the primary care workforce.

How easily these gains can be reversed. The 82nd Legislature took a giant step backward when it chose to cut state support of medical residencies by 44 percent, from $106 million in funding for the current biennium to $59.6 million in 2012-2013; slash loan repayment programs, allocating $5.6 million to one repayment program for the first year only and zeroing out another program set up to meet the needs of Texas children; and completely eliminate the Statewide Primary Care Preceptorship Program.

Texas’ 28 family medicine residency programs prepare about 200 new family physicians each year for practice and these programs manage primary care clinics that deliver well-coordinated, cost-effective care to communities that need it. A significant portion of the care they provide is for Medicaid and CHIP patients, Medicare patients, and the uninsured. Many programs already operate at dangerously narrow margins, often teetering on the brink of closure, and proposed budget cuts could be the final nail in the coffin.

Cuts to the loan repayment programs alone could affect up to 1.1 million Texans, by the Texas Higher Education Coordinating Board’s estimate. Because of lack of funds to recruit new physicians to underserved areas, 750,000 patients could see diminished access to care, and the 426,000 currently served by 142 doctors in the program would likewise have difficulties finding a replacement physician to care for them.

Studies of the preceptorship programs in Texas indicate that exposing medical students to primary care clinical experience early in their training, like that provided by the Texas Statewide Preceptorship Program, is an effective method of increasing the number of primary care physicians and expanding access to primary care in underserved populations. Not funding this program further deteriorates our state’s ability to produce the next generation of primary care physicians.

In addition to patient care, physicians contribute to the state economy, which can be of particular benefit to rural and underserved communities. A March 2011 study by the American Medical Association revealed that through supporting jobs, purchasing goods and services, and generating tax revenue, office-based physicians contributed $1.4 trillion in economic activity and supported 4 million jobs nationwide. And the study found that office-based physicians are unique in the health care system in that they almost always contribute more to state economies than hospitals, nursing homes, and home health agencies.

Without investing in an adequate primary care base our state will not have the network of physicians it needs to care for a population ballooning at both ends of the age spectrum, and health care costs will inevitably continue their unsustainable march higher.

All is not lost. Texas has a narrow window of opportunity to identify state-based strategies that will trigger dramatic improvements in our health care delivery system, empower patients to better understand their health care choices and responsibilities, increase competition in the insurance market, and lower overall costs.

Should S.B. 8 pass during the Special Session, its goals can be achieved eventually; the bill lays the foundation to re-engineer the fractured health care system to one that serves patients and bends the cost curve to make the system sustainable long term.

The 82nd Legislature fumbled on ensuring we have an adequate workforce to make these goals a reality, but we hope that future legislatures will recommit to primary care for the sake of Texans’ future. Because without the primary care physician workforce, the potential achievements of Senate Bill 8 are just hollow promises.

Share

Is it time to declare independence from the RUC?

In a recent opinion column published in Kaiser Health news, two prominent voices in health care policy gave primary care physicians a piece of revolutionary advice: Quit the RUC.

If you don’t know what the RUC is, you aren’t alone.

RUC stands for the Relative Value Scale Update Committee, a group of 29 physicians from various medical specialties that meets three times a year to advise the Centers for Medicare and Medicaid Services on Medicare physician fee reimbursement and how certain procedures should be valued. Created by the American Medical Association in 1991, the committee has no official government standing, yet it yields great power.

CMS approves 90-94 percent of the committee’s suggestions, and because many government and commercial health plans follow Medicare’s lead to set their own fee schedules, its influence bleeds into other markets as well.

So what’s the problem? The committee is overwhelmingly dominated by specialists, outnumbering primary care physicians by a ratio of 6:1 or 13:1 depending on whether you count internal medicine, osteopathy, and pediatrics. As such, Brian Keppler, Ph.D., and David Kibbe, M.D., M.B.A., write that its payment recommendations have “consistently favored specialists at the expense of primary care physicians.” They point out that, on average, specialists out-earn primary care physicians by $135,000 a year and $3.5 million over the course of their careers.

In the $500-billion Medicare program, physician fees make up just one piece of the pie and the RUC cannot be blamed solely for the spiraling costs of health care. However, the authors assert that “the perverse incentives embedded in fee-for-service physician payments influence care decisions and are a principle driver of the health system’s immense excesses.” Further, “the system pays more for invasive approaches, so conservative treatment choices that are lower cost and lower risk to the patient may be passed over, especially near the end of life.”

They recommend that TAFP, along with other primary care medical specialty societies in the country, “loudly and visibly leave, while presenting evidence that the process has been unfair to their physicians and, worse, to American patients and purchasers.”

The AAFP Congress of Delegates has debated the question of leaving the RUC in recent years, and AAFP has been active on several fronts trying to get more primary care representation on the RUC and to get CMS to reconsider its decisions when accepting recommendations from the RUC.

There are also other ideas floating around to curb the RUC’s influence. One comes from physician-politician Jim McDermott, a U.S. representative from Washington. He wrote in an opinion column for the New England Journal of Medicine, “Congress should consider enlarging or realigning the composition of the RUC, if not demoting it to an advisory function and requiring greater transparency of its deliberations.”

Additionally, a provision in the health care reform law creates the Independent Payment Advisory Board that is tasked with capping Medicare spending beginning in 2015. Much of the momentum for creating such an entity was aimed directly at counteracting the inflationary bent of the RUC’s recommendations.

Interesting to point out is recent action from the AMA, American Hospital Association, and other specialty groups to weaken or quash the IPAB.

AAFP supported the concept, though has not been entirely happy with all aspects of the IPAB in the final legislation and continues to push for changes, such as including a primary care representative and a consumer representative to the board, including a public comment period before Congress acts on the IPAB recommendations, and including all segments of the health care industry (i.e., hospitals, nursing homes, pharmaceutical manufacturers, etc.) in the scope of the IPAB review.

Whatever happens, it certainly sounds like the RUC is in for some changes.

Read the Keppler/Kibbe article here: http://www.kaiserhealthnews.org/Columns/2011/January/012111kepplerkibbe.aspx

Read more about the IPAB here: http://www.kaiserhealthnews.org/Stories/2011/January/26/health-industry-lawmakers-medicare-spending-board-IPAB.aspx

Share

Blog rec: “Health Scare” online

Part of the mission of the TXFamilyDocs blog is to highlight the work of our members. I’d like to direct you to an insightful blog by TAFP member Richard Young, M.D., titled, “American Health Scare: How you are scared into buying health care you, your employer, and your country can’t afford.” On the blog and website, Young gives a family physician’s non-partisan perspective on the health care reform law and other big issues facing the specialty, challenging readers to consider the “appropriate role” of health care in our society and asserting that “the primary solution to expensive health care is that the relationship between doctors and patients must change.”

Check it out at www.healthscareonline.com.

Share

The rise of the ACO and lessons learned from the Medicare Physician Group Practice demonstration

As envisioned in the health reform law, the latest evolution of health delivery system reform involves consolidating the fragmented system of health care providers into efficient groups that take responsibility for a population of patients. Called accountable care organizations, this model boils down to three concepts: providing coordinated care by using all members of the health care team, measuring performance against evidence-based benchmarks, and reforming a payment system that currently rewards quantity over quality and reactive medicine over preventive medicine. The hope is that coordination, performance measurement, and payment reform will allow physicians to improve the quality of care for patients and reduce the cost.

Coordinating care to reduce cost isn’t a new concept. Some liken it to health maintenance organizations of the ’80s and ’90s, others to the patient-centered medical home. There is plenty of literature on both, and we won’t delve into them here.

If you’re looking for guidance on ACOs, one of the most useful sources is the five-year CMS pilot project that began in April 2005 and concluded in March 2010. (When lawmakers were crafting the health reform law, they had access to years 1 and 2. Now we also have 3 and 4, and are waiting for 5.)

In the Medicare Physician Group Practice demonstration, CMS contracted with 10 large multispecialty groups with varied organizational structures to see whether care management initiatives could produce cost savings for the system and improve quality. [Spoiler alert: All of the groups improved quality, and about half produced cost savings. More on this below.]

On top of individual physicians’ fee-for-service claims, groups were eligible for an 80 percent share of Medicare’s savings if they collectively achieved quality and cost targets for the patients loosely assigned to their group. There were no penalties for missing the targets. To qualify for these performance payments, groups had to generate savings for Medicare parts A and B of more than 2 percent of their target expenditures. CMS established the spending targets by creating a comparison group of Medicare beneficiaries in the same geographic area and comparing the organization’s per capita expenditures in its base year with those for the comparison group.

As hinted above, results revealed that all 10 entities achieved significant improvements in patient quality of care and patient satisfaction, with half receiving performance payments of $31.7 million in the fourth year of the program. The groups that earned bonuses attributed the savings to changes in their organizational structure, investments in care management programs and health information technology, and continuing education and feedback for providers.

Interestingly, the four groups that earned performance payments by the second year were affiliated with an academic medical center or were unaffiliated physician groups, and the majority of the savings at all sites occurred in outpatient services. The big winner was the Marshfield Clinic in Marshfield, Wis., which received the most over the first four years—a total of more than $40 million.

The five groups that received no performance payments in the second year were part of integrated delivery systems with hospitals or physician networks sponsored by hospitals. Some were able to turn this around in years 3 and 4, most notably the Geisinger Clinic in Danville, Penn., and St. John’s Clinic in Springfield, Mo.

All of this is to say that implementing ACOs probably won’t produce immediate savings, but they will almost certainly improve the patient experience. And because of that, it’s likely this concept will continue to gain in popularity.

That means that both hospitals and physicians must learn how to function in a new system, which will likely require figuring out how they can align their goals and incentives to drive the highest-quality care in the most cost-effective way. It’s about better managing utilization of services, to provide exactly enough care for patients and cut down on waste and duplication. If that is achieved, we’ll be on the right path.

Watch for more on ACOs in the next issue of TEXAS FAMILY PHYSICIAN magazine. AAFP is currently working on a ACO special section of their website, http://www.aafp.org/, that should be available soon. We’ll  post it when it is. For now, check out the Joint Principles for Accountable Care Organizations released by AAFP in November 2010.

Share
ASSA Flickr Stream

Error: Twitter did not respond. Please wait a few minutes and refresh this page.