The ACP Advocate Blog

by Bob Doherty

Friday, July 19, 2013

House SGR bill promotes Medical Homes

Last night, the House Energy and Commerce Committee released a bipartisan bill to repeal Medicare’s SGR formula, replacing it with a system that will involve quality reporting under the fee-for-service (FFS) system combined with strong incentives for physicians to move into alternative payment models. While the bill offers a lifeline to physicians who choose to remain in FFS, the incentives favor physicians who are willing to take the necessary steps to become Patient-Centered Medical Homes, Accountable Care Organizations, or other models that enhance care coordination, patient safety, prevention, and patient experience with the care provided.  The bill promotes many of the goals that ACP has advocated to  Congress through its comments on prior drafts of the legislation, including repeal of the SGR, providing five years of stable and positive payments to all physicians, creating opportunities for physicians to get incentive-based quality payment updates, and establishing a transition period and pathway for physicians to participate in alternative payment models.

Highlights:

Repeals the SGR, immediately upon enactment.

Provides for positive but modest, annual Medicare fee schedule updates in 2014 through 2018 of O.5%. 

Establishes a Quality update incentive program beginning in 2019 for physicians who choose to continue to be paid under FFS.  Physicians would self-select a “clinical cohort” applicable to their specialty and type of practice, and would be measured based on how well they performed on clinical performance measures and clinical practice and care delivery systems appropriate for their cohort.  Emphasis would be on measures that improve care coordination, patient safety, prevention, and patient experience with the care provided.  Physicians would be scored on a scale of 1 to 100, and those scoring in the top third would get an annual FFS update of 1.5%, those scoring in the next third would get a 0.5% update, and those in the lowest third would get a MINUS 0.5%.  Those who declined to participate in the quality reporting program, or to join in an approved new Alternative Payment Models, would get a 5.0% cut in their total Medicare payments each year starting in 2019.

Creates a process for physicians to recommend and participate in Alternative Payment Models to Medicare.  Alternative Payment Models selected by CMS would not participate in the quality update incentive program; instead, physicians in those models would be paid under the payment rules applicable to the particular model. For instance, an approved ACO might be paid under a shared savings arrangement; a PCMH under a risk-adjusted capitation system combined with FFS and shared savings.

Medicare would be directed to begin paying physicians, starting in 2015, for care coordination of patients with complex chronic diseases.  However, in order to qualify for such payments, physicians would have to be in a Patient-Centered Medical Home, or a Patient-Centered Medical Home specialty practice, as recognized by the National Committee on Quality Assurance (NCQA) or another certification process as established by the Secretary.

The bottom-line for physicians is that the bill gets rid of the annual specter of double-digit SGR cuts, stabilizes FFS payments, offers FFS physicians the opportunity to improve their FFS updates for successfully reporting on quality measures, promotes the importance of care coordination and especially, the Patient-Centered Medical Home model, and creates incentives and opportunities for physicians to recommend and participate in medical homes and other Alternative Payment Models that would be paid under their own rules instead of the FFS quality update program.  

The bipartisan message from Congress is clear: if physicians choose to remain only in FFS, their annual updates going forward will be very modest, 0.5% for the next five years, and no more than 1.5% and as low as -0.5% depending on where they rank in the new quality reporting system that would begin in 2019.  (And if they don’t participate in the quality reporting system at all, or one of the Alternative Payment Models, they would get an annual 5% cut).  But physicians who are willing to become certified PCMHs, or become specialty practice medical home neighbors, or enter into ACOs or other alternative models, won’t have to report on the measures for the quality update program or be subject to annual FFS quality update incentives.  Instead, they will have more opportunities to be reimbursed for complex chronic care coordination and share in savings to the Medicare program from improving care coordination, patient safety, and patient experience with the care provided.

Because the bill has support from both Republicans and Democrats, it has a reasonably good chance of making it through the House of Representatives.  The Senate is working on a similar approach.  So if you are a physician who has been on the fence on whether it is worth it to become a PCMH or an ACO, well, the incentives are now clearly pointing you in that direction.

Today’s question: What is your reaction to the bipartisan SGR repeal, physician payment reform bill?

4 Comments :

Blogger Fiddler said...

I am probably in the last 4 or 5 years of a solo non-procedural subspecialty practice with a very large population of Medicare patients with diabetes. The current proposed changes I am supposed to make (somehow become a medical home, upgrade my EHR to "meaningful use")are, at least to me, punitive. There is also no recognition of the 30 years of cost effective (I can't charge a facility fee), efficient, and high quality care I have already delivered. Bottom line, I will probably retire 5 years earlier than planned.

July 23, 2013 at 7:12 PM  
Blogger Harrison said...

Some "morally unchallenged" Senator will attach an Anti-Abortion provision of some kind that will poison it.
It will die.

Nothing meaningful is coming out of this Congress.

Especially nothing will make it that makes the President look positive.

We have to engage in ACO's or PCMH's because CMS uses whatever freedom it has to add incentives.
Congress will not do anything.
And the SGR repeal, which could probably get Unanimous support in both houses, will likely not happen in this Congress either.
Because something will be attached to kill it.

We should be upset about the repeal of voting rights.
About the obsession with the health care bill.
About the inability of Congress to stop the dramatic increase in student loan interest rates.
About the lack of agreement on an immigration bill.
About our government's paranoid spying.
About our government's force feeding of political prisoner's in guantanimo, and about using doctor's for what amounts to torture.
About drone strikes, and the image they create around the world about how willing America is to engage in 'We kill and You die" wars, often punishing civilians much more than military targets.

But Will and Kate's baby has a name, and we all are perfectly up to date on Anthony Weiner's latest sexting.
So,.... I guess we're okay.

Harrison

July 24, 2013 at 2:16 PM  
Blogger ryanjo said...

I am not okay with any of those things. But we all became part of this when our leaders decided to partner with the political sphere to reform matters in our profession.

July 24, 2013 at 5:00 PM  
Blogger Jay Larson MD said...

This is not a game changer. The incentives are too modest to entice more physicians to do primary care, especially for Medicare patients. As overhead costs of running a practice continue to escalate beyond 1.5% per year, the cognitive specialists will continue to lose ground financially. I am seeing more and more private practice physicians choose not to see Medicare patients anymore because their practice has become financially not viable with Medicare reimbursement.

July 25, 2013 at 1:26 PM  

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About the Author

Bob Doherty is Senior Vice President, American College of Physicians Government Affairs and Public Policy; Author of the ACP Advocate Blog

Email Bob Doherty: TheACPAdvocateblog@acponline.org.

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