Will Value-Based Payment Actually Work?
By Shannon Firth | Apr. 18, 2017
The move toward value-based payment “sounds so good you can’t be against it, but that doesn’t really mean you’re for it,” according to Alan Weil, editor-in-chief of Health Affairs, speaking at a briefing Tuesday.
Weil, who moderated a series of panel discussions sponsored by the Commonwealth Fund and the Federation of American Hospitals, noted that different stakeholders view value-based payment in their own ways, but then ignore those differences, such as the anticipated speed of change, incentives on the provider or patient side, and the measurements that are used to assess value.
He drew parallels between value-based payment and managed care. “Who’s really for ‘unmanaged’ care?” Weil stated. “But how we manage care or coordinate care is actually very complex.”
Paying for Value
Briefing attendee Barbara Tomar, director of public policy for the American College of Emergency Physicians, expressed concern about the current administration’s push to pay for the value of services rather than the volume of services, under the newly implemented Medicare Access and CHIP Reauthorization Act (MACRA).
Advanced alternative payment models (APMs) — the more transformative of two pathways for Medicare payment under MACRA that includes a 5% bonus — may be seen as “the way to go in the long-term,” particularly among specialists, Tomar said.
Under the new payment framework CMS recently enacted, clinicians are incentivized to move into advanced APMs. Programs are often tailored to the skill-sets and goals of individual specialties.
In April 2015, Congress voted to eliminate the highly unpopular Sustainable Growth Rate formula as a mechanism for managing physician payment and replaced it with MACRA.
In October 2016, CMS released the final MACRA Rule, which overhauls physician payment with the goal of tying reimbursement to value.
The Quality Payment Program offered physicians two pathways for reimbursement: The Merit-based Incentive Payment System (MIPS) and the advanced Alternative Payment Models (APM). The APM track is the more complex, transformative track. Physicians belonging to an advanced APM will receive a lump-sum 5% incentive payment from 2019 through 2024 and a higher annual payment beginning in 2026.
The Centers for Medicare and Medicaid Services (CMS) noted that driving participation in advanced APMs is one of its goals.
However, this push could have unintended consequences for the healthcare system, Tomar said.
She likened the possible influx of APMs to “a thousand flowers blooming,” borrowing an expression from former Chinese leader Mao Zedong. Such an approach — having one model for a single aspect of one specialty — might only increase fragmentation in the healthcare system.
“What’s the end game? Where do we hope to get with hundreds of APMs or thousands?” she stated.
Robert Berenson, MD, institute fellow at the Urban Institute and a member of the Physician-focused Payment Model Technical Advisory Committee (PTAC), agreed, stating that many of the APMs the committee has received could be resolved with changes to the Physician Fee Schedule. PTAC is charged with making recommendations to the administration regarding which APMs meet established criteria.
For example, instead of creating a new APM model for oncologists to develop a medical home for cancer patients, physicians could be paid for the time it takes to make phone calls and communicate with other physicians to improve that patient’s care, he told MedPage Today. A similar code already exists for chronic care management, he noted.
PTAC voted last week to recommend an advanced APM for inflammatory bowel disease. In the 7-3 vote, Berenson was among the minority in voting against that recommendation.
“You need to fix the fee schedule, if you’re going to get the value out of the alternative payment model,” he said.
Berenson also pointed to the voluntary Bundled Payments for Care Initiative, suggesting that until a mandate forces clinicians in specific regions to enact the model, it will be hard to see its impact.
“I won’t be convinced one way or the other [that a model works] until I see mandatory bundles,” he said. He stressed that his comments are his own opinions and do not represent the views of PTAC.
‘Simplicity and Flexibility’
In designing the MACRA Rule for 2017, and now developing the “Year 2” proposed rule, “you always have to make trade-offs, and often what that tradeoff is, is between simplicity and flexibility,” noted Kate Goodrich, MD, director of the Center for Clinical Standards and Quality and chief medical officer for CMS.
“I think we want to ensure that all clinicians out there ultimately have an opportunity to be part of an advanced APM that works for them, and works for their practice,” Goodrich told MedPage Today during a phone call after the meeting. A CMS media representative was present during the call.
She said it’s not clear whether this approach would result in numerous “disconnected” APMs or whether a system with “just right number” of APMs could emerge.
Goodrich emphasized that CMS wants to see what comes through the PTAC and into the Center for Medicare and Medicaid Innovation (The Innovation Center). All of the proposed models would be subject to a “rigorous review” and approval by the secretary of the U.S. Department of Health and Human Services.
About 70,000-90,000 clinicians are expected to take part in the advanced APMs, according to Goodrich.
Clinicians who bill less than $30,000 in Medicare charges, or who have fewer than 100 Medicare patients in a year, are currently excluded from the program. Clinicians who are not eligible for an exclusion will likely default to MIPS.
MIPS marries elements of a handful of prior reporting schemes — the Physician Quality Reporting System; the Value-based Payment Modifier; “Meaningful Use” or the Medicare Electronic Health Record (EHR) Incentive Program for Eligible Professionals — into one unified program that consists of four performance areas: quality, cost, improvement activities, and advanced care information.
Goodrich noted that the administration will be making proposals related to virtual groups, scoring improvements (year-to-year improvements in physicians scores), and plans for all-payer APMs for 2018 in the next few months.