Today (1/26/15) HHS made a historic” announcement regarding
how Medicare will change the way it pays for medical care:
“…Health and Human Services
Secretary Sylvia M. Burwell today announced measurable goals and a timeline to
move the Medicare program, and the health care system at large, toward paying
providers based on the quality, rather than the quantity of care they give
patients.” (Better,
Smarter, Healthier: In historic announcement, HHS sets clear goals and timeline
for shifting Medicare reimbursements from volume to value)
The announcement sets out admirable goals and is gutsy in
that it lays out specific benchmark numbers by which success can be
judged. But as is to be expected with
any announcement of this scope, there are elements to be admired and elements
to be questioned. Below is an initial review of the announcement and some of the coverage.
The Secretary’s blog post on the changes included this
regarding the need for change:
“Whether you happen to be a
patient, a provider, a business, a health plan or a taxpayer, it’s in our
common interest to build a health care delivery system that’s better, smarter
and healthier – a system that delivers better care; a system that spends health
care dollars more wisely; and a system that makes our communities healthier.” (Progress
Towards Achieving Better Care, Smarter Spending, Healthier People)
There is also a piece by the Secretary in the New England
Journal of Medicine
“The Department of Health and Human Services
(HHS) now intends to focus its energies on augmenting reform in three important
and interdependent ways: using incentives to motivate higher-value care, by
increasingly tying payment to value through alternative payment models;
changing the way care is delivered through greater teamwork and integration,
more effective coordination of providers across settings, and greater attention
by providers to population health; and harnessing the power of information to improve
care for patients.”
“Although we have much to celebrate
regarding increased access and quality and reduced cost growth, much of the
hard work of improving our health care system lies ahead of us.” (Setting Value-Based
Payment Goals — HHS Efforts to Improve U.S. Health Care)
Concurrently, the following fact sheets were released:
To read more about why this matters: http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-01-26-2.html
To read a fact sheet about the goals and Learning and Action
Network: http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-01-26-3.html
To learn more about Better Care, Smarter Spending, and
Healthier People: http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-01-26.html
As might be expected, there was immediate coverage of the
news:
This piece reviews the announcement and what it is trying to
accomplish: Obamacare
2.0: the White House's radical new plan to change how doctors get paid
“If this works, the White House
hopes it will do two things. The first is improve the quality of health care in
the United States, by paying doctors the most when they provide the best care
possible. Second, and perhaps more importantly, the Obama administration sees
this new plan as a way to cut health care spending by dis-incentivizing
unnecessary medicine. Wasteful care is a huge problem in the United States: the
Institute of Medicine estimates we spend $210 billion annually on medicine that
doesn't make us any healthier.”
“Medicare has been experimenting
with payment models for more than a decade, and the 2010 Affordable Care Act
tackled the issue by expanding payment models that reward providers for the
value of care they provide. The programs include lump sum payments for treating
a patient throughout an episode of care, like a knee replacement surgery. The
most high-profile effort has been with accountable care organizations (ACOs),
which are groups of providers who share in the savings – or losses – for
managing patients on a budget.”
This piece reminds us that the methods of achieving the
goals are still works in progress: The
Obama administration wants to dramatically change how doctors are paid
“We still know very little about
how best to design and implement [value-based payment] programs to achieve
stated goals and what constitutes a successful program," concluded a 2014
Rand Corporation study funded by HHS. The report, which reviewed pay-for-performance
models implemented over the past decade, said improvements were "typically
modest" and often hard to evaluate.”
Given the Rand study, a certain degree of skepticism is to
be expected (and is healthy when reviewing announcements of this nature): I’m
hoping this isn't the Underpants Gnomes method of payment reform
And finally, this second piece, while calling it: A
Courageous First Step includes a cautionary note about moving forward:
“Many have dipped a timid toe, or
hedged their bets with low-regret moves like buying up practices and forming
organizations that are Accountable Care Organizations (ACOs) in name only.”
“Unfortunately, this strategy is
already too widespread, and likely to grow as long as large organizations are
allowed to continue in “one-sided” (upside only) shared savings models, as
recently proposed by CMS. It’s also a major reason why so few
hospital-sponsored ACOs have actually achieved savings bonuses. Defensive moves
by hospital systems provide a veneer of action, while consolidating
regulator-blessed market dominance that can raise local prices without
improving quality at all.”
