News About CHQPR
Both patients and healthcare providers could be harmed by the measures of healthcare spending Medicare plans to use in its new
Value-Based Payment Modifier for physicians and in the Value-Based Purchasing Program for hospitals. Serious problems also exist with
the spending measures that many commercial health plans are using to define narrow networks and that both Medicare and commercial
health plans are using in various "shared savings" payment contracts with physicians, hospitals, and Accountable Care Organizations.
A report from the Center for Healthcare Quality and Payment Reform - Measuring and Assigning Accountability for Healthcare Spending
- explains how the spending measures used in so-called "value-based purchasing" programs can:
- Inappropriately assign accountability to physicians and hospitals for services they did not deliver and cannot control, while at the same time failing to hold healthcare providers accountable for many of the services they do deliver;
- Financially penalize physicians and hospitals who care for patients with complex health problems and who deliver evidence-based services to their patients;
- Fail to provide physicians, hospitals, and other providers with the kind of actionable information they need to identify opportunities to control healthcare spending without harming patients; and
- Give patients misleading information about which providers deliver lower-cost, higher quality care.
The report details multiple, serious weaknesses in the simplistic "attribution" methodologies Medicare and other payers are currently using to retrospectively assign accountability to a single physician, hospital, or other provider for all of the spending on all of the healthcare services received by a patient over a period of time, regardless of which providers actually delivered those services. For example, under current approaches:
- Most of the spending that is attributed to a physician usually results from services delivered by other providers.
- Physicians are assigned responsibility for services new patients receive before the physician first met the patient.
- Primary care physicians are assigned responsibility for services delivered by specialists to treat serious illnesses such as cancer; and
- Specialists and hospitals are assigned responsibility for unrelated healthcare problems their patients experience in the future.
The report also describes how the "risk scores" currently used to adjust spending measures fail to recognize important differences in patient needs and can thereby mislabel physicians and hospitals as "inefficient" if they care for patients who have acute illnesses or complex problems.
In addition to documenting the many serious problems with current approaches, Measuring and
Assigning Accountability for Healthcare Spending
shows how they can be solved. A detailed methodology is presented for assigning accountability to providers for the services they actually can
control or influence. The methodology also explicitly identifies which services might be changed in order to achieve the same or better
outcomes for patients at a lower cost. In addition, methods are described for comparing providers' performance in treating patients with
similar needs rather than trying to use a single, simplistic risk score to "adjust" spending. The report shows how these improved methodologies
can use existing data to produce more valid, reliable, comprehensive, and actionable measures than those currently being used.
Better ways of measuring and assigning accountability for spending are necessary but not sufficient for achieving a higher-value healthcare
system. Even if they use better spending measures, value-based purchasing, pay for performance, and shared savings payment systems do not
remove the fundamental barriers to better care that are created by the current fee-for-service system.
Measuring and Assigning Accountability for Healthcare Spending
shows how better ways of measuring spending can help payers and providers move more quickly to true payment reforms such as bundled
payments, warranties, condition-based payments, and global payments.
Both the full report
and a 7-page Executive
Summary are available at no charge from CHQPR website. Comments on the report are welcome.
On February 14, 2013, Harold Miller, Executive Director of CHQPR, gave invited testimony at a
hearing of the Subcommittee on Health of the House Energy and Commerce Committee of the U.S. Congress. Key points in the testimony include:
- The Sustainable Growth Rate formula should be repealed.
- Fundamental changes in the fee-for-service system are necessary in order to control the growth of Medicare spending and to improve the way care is delivered to Medicare beneficiaries. Congress will have limited success in controlling Medicare spending and providing truly high-quality care to Medicare beneficiaries if it merely uses quality-based pay-for-performance or shared savings programs built on top of the dysfunctional fee-for-service system. Fortunately, there are better ways of paying physicians that can enable them to make more significant improvements in patient care and achieve greater savings for Medicare.
- Accountable payment models need to be designed and implemented as quickly as possible in ways that will work for every specialty and every part of the country. To do this, Congress should establish a new, bottom-up approach to payment reform, whereby physicians, provider organizations, medical specialty societies, and regional multi-stakeholder collaboratives are invited to develop payment models that will work well for individual physician specialties in the realities of their own communities.
- New payment models should be able to be proposed to CMS at any time, with no limit on how many different proposals can be approved as long as they will improve care and reduce costs. Proposals must be reviewed quickly
and CMS should have the obligation to approve a proposal if it is specifically designed to improve patient care and save Medicare money.
- There should be frequent opportunities for physicians to apply to participate in already-approved payment models. Every physician should be permitted to participate in an accountable payment model whenever they are
ready to do so. If a physician is participating in such a model, they shouldn't be subject to threats of SGR-type payment reductions.
- Physicians need to be given access to Medicare claims data so they can determine where the opportunities for saving are, how care will need to be redesigned to achieve those savings, and how payment will need to change to support better care at a lower cost.
- Once a physician is participating in an accountable payment model, they should have the ability to continue participating as long as they wish to do so if the data show that the quality of care is high and Medicare spending is being controlled.
- Funding should be made available to medical specialty societies and multi-stakeholder Regional Health Improvement Collaboratives to provide technical assistance to physicians.
- To help new payment models be as successful as possible, Congress should ask Medicare beneficiaries to designate which physician(s) they want to be in charge of care for each of their conditions, so that there is no need to use complicated, inaccurate statistical attribution methodologies to determine which physicians are accountable for which patients.
CHQPR Testimony to Congress, 2011
On May 5, 2011, CHQPR Executive Director Harold D. Miller gave invited testimony to the U.S. House of Representatives'
Committee on Energy and Commerce at its hearing on how to
replace the Sustainable Growth Rate formula.
Miller urged that Congress focus on three major ways to control costs in the Medicare and Medicaid programs without having to deny care that patients need:
- by preventing diseases from occurring in the first place;
- by helping patients manage chronic diseases and other conditions so they don't have to be hospitalized as often; and
- by reducing the high rate of infections, complications, and readmissions that occur today when patients do have to be hospitalized.
Miller noted that all of those things not only save money but improve outcomes for patients. But he said that current payment systems drive the healthcare system in
exactly the opposite direction. Doctors and hospitals lose money when they reduce infections and readmissions; doctors and hospitals lose money when they help patients avoid
unnecessary hospitalizations; and nobody in health care gets paid at all when patients stay well. He emphasized that those things can't be fixed by changing fee levels or
by adding regulations; the payment system itself is broken and has to be fundamentally changed.
He called for two major kinds of payment reforms:
- One is episode-of-care payment, where physicians and hospitals are jointly paid a single price for all of the services associated with a
hospitalization or procedure, including a warranty stating that they will treat any related infections and complications at no extra charge.
This is the same approach that every industry uses for selling products and services and it can be done in healthcare, too.
- The other is comprehensive care payment, where a physician practice receives a single payment for all of the care a patient needs for their chronic diseases or other
Miller said that paying in these ways provides the flexibility that physicians need to deliver better care as well as accountability for costs. He noted that where these
payment systems have been used, they have improved quality and lowered costs. He said that a myth that has developed is that only large, integrated delivery systems can manage
such payments and deliver higher-value care, but he said that small, independent physician practices can also do so. Indeed, he emphasized that just like in every other
industry, small healthcare providers can often be more efficient and innovative than large systems can, if they are given the opportunity to do so without imposing unnecessary
and expensive regulatory requirements.
Miller noted that he had talked to physicians all over the country about these payment reform concepts, and had found that once physicians understand them,
they were willing to embrace them. But he said that physicians need assistance to implement new payment models successfully, and they need a reasonable transition period. He said
physicians need four kinds of help:
- First, physicians need data on utilization and costs, and they need useful analysis of those data. Physicians today typically can't find out how often their patients
are being hospitalized, going to the ER, being readmitted, or getting duplicate tests. Electronic Health Records alone won't solve this, nor will typical published measures of
quality and cost.
- Second, physicians need training and coaching to help them restructure their practices so they can deliver more efficient and higher quality care. Not only is this
kind of re-engineering not taught in medical school, it is hard for physicians to do it and still keep up with the demands of ongoing patient care.
- Third, physicians need transitional payment reforms that will enable them to restructure the way they deliver care without risking bankruptcy. These transitional
payment reforms can be designed in ways that can improve quality for patients and still save Medicare and other payers money.
- Fourth, physicians need to have all payers - Medicare, Medicaid, and commercial health plans - make these payment changes and do so in similar ways.
Miller said he felt the best way to organize this help was not through a one-size-fits-all federal program, but through community-level efforts, because healthcare is
delivered in very different ways in different parts of the country. He noted that in a growing number of communities around the country, there are non-profit, multi-stakeholder
organizations called Regional Health Improvement Collaboratives that are working to provide the data and technical assistance that physicians, hospitals, employers,
health plans, and consumers need to design and implement better payment and delivery systems that are customized to the needs of their communities. He said that Congress could help
these Regional Health Improvement Collaboratives and other community efforts to support payment reforms for physicians in several ways:
- by giving Collaboratives access to Medicare data so they can help physicians identify the best opportunities to improve quality and reduce costs;
- by giving them some modest federal funding so they can provide the hands-on help that physician practices need to reduce costs elsewhere in the system.
- by encouraging or requiring Medicare to participate in the multi-payer payment and delivery reforms their communities design.
CHQPR in the News