JENNIFER L . GWILYM, DOHEALTH POLICY FELLOWSHIP
SEPTEMBER 20 , 2013
Impact of Medicare’s New Value-Based Payment Modifier
Value-Based Payment Modifier
Replace Fee for Service Medicare (2015)Complex calculation based on cost profiles
and quality data of physicians
http://www.acepnews.com/news/news-from-the-college/single-article/physician-value-based-payment-modifier-starts-in-2015/
Value-Based Payment Modifier
http://www.the-hospitalist.org/details/article/3782371/John_Nelson_Peformance_Key_to_Federal_Value-Based_Payment_Modifier_Plan.html December 2012
Medicare’s Financial Challenges
Covers “Reasonable and necessary” servicesProblems: More beneficiaries qualify,
healthcare is more costly, fewer workersCBO: Medicare Part A will be bankrupt in
202025% 65 and over living FPL in 1965 – now
half of beneficiaries live in povertyAverage lifespan 1965 was 70 y/o, now 78.5
years
Decreases in Tax Revenue Impact Medicare
Originally, payroll tax 2.9% of all wage earners, split by employee and employer
2013 ACA mandates persons making over $250,000 will pay 3.8%
1965: 4.6
taxpayers per
retiree
2013: 3.7
taxpayers per
retiree
2030: 2.4
taxpayers per
retiree
New Physicians’ Cost profiles
Physicians with less than 10 years experience have a 13.2% higher cost profiles than physicians who have been practicing for over 40 years
Possible reasons: Newer and more expensive treatment modalities More aggressive care due to lack of experience Shorter relationships with their patients Less-experienced may treat sicker patients or more
non-compliant patients Health Affairs, 2012
Experienced Physicians’ Practice Patterns
Physicians in practice longer
May provide lower-quality carePosses less factual knowledgeLess likely to adhere to appropriate standards of careMay have poorer patient outcomesLess likely to adopt new proven therapies Exempt from recertification requirements
Systematic Review, 2005
Unintended Consequences of VBPM
Decrease access to new physicians to provide access to quality care for patients
Force new physicians to modify their practice patterns
New physicians in training programs would be concerned with their cost profiles instead of learning to practice medicine, resulting in less familiarity with certain procedures
Decreased Medicare Reimbursement
Physicians will have to see more patients on a daily basis, therefore, spend less time with each
Medicare reimburses 81% of private insuranceSustainable Growth Rate (SGR)Increased bureaucracy, additional paperwork, more
oversight, less autonomy = job dissatisfactionIncrease physician shortage-retire or switch careersDeter people from pursing medicine as a career
Recommendations
Delay implementation of VBPM until guidelines are written and simplified
Post on Health Compare WebsiteEncourage ‘parsimonious care’ – accept some
responsibility for the cost of careCalculate cost profiles incurred during
practice, not during residency
References
Background Medicare Value-Based Payment Modifier. (2012, 12 31). Retrieved from CMS.gov: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Background.html
Executive Summary-AOA. (2012, 9 4). 2013 Medicare physician Fee Schedule Proposed Rule Summary of AOA Recommendations. American Osteopathic Association (AOA).
Value-Based Payment Modifier. (2012, 31 12). Retrieved from CMS.gov: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/ValueBasedPaymentModifier.html
al., N. K. (2005). Systematic Review: The Relationship between Clinical Experience and Quality of Health Care. Annals of Internal Medicine, 260-273.
Anita Arora, M. e. (2012). hat Kind of Physician Will You Be? Variation in Health Care and its Importance for Residency Training. The Dartmouth Institute.
Bell, M. (2013, 3 4). Why Your Children Won't Have Medicare. Retrieved from Forbes.com: http://www.forbes.com/sites/michaelbell/2013/03/04/why-your-children-wont-have-medicare/
CMS. (2012, 12 31). Medicare FFS Physician Feedback Program/Value-Based Payment Modifier. Retrieved from Centers for Medicare & Medicaid Services: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Background.html
Cooper, R. a. (2009). States with More health Care Spending Have Better-Quality Health Care: Lessons About Medicare. Health Affairs, 103-115.
Dunn, L. (2011, 8 31). AHA: Value-Based Purchasing Programs Fail to Meet Requirements Set Forth by ACA. Retrieved from Becker's Hospital Review: http://www.beckershospitalreview.com/hospital-management-administration/aha-value-based-purchasing-programs-fail-to-meet-requirements-set-forth-by-aca.html
Elliott Fisher, M. M. (2009, 2 27). Health Care Spending, Quality, and Outcomes More Isn't Always Better. A Dartmouth Atlas Project Topic Brief. The Dartmouth Institute.
Fiegl, C. (2012, 9 17). Medicare Modifier Could Hit Unsuspecting Doctors with Pay Cuts. Retrieved from amednews.com: http://www.ama-assn.org/amednews/2012/09/17/gvl10917.htm
Fisher ES, W. H. (1999). Avoiding the unintended consequences of growth in medical care: How might more be worse? JAMA, 446-453. Jason Fodeman, M. (2011, 4). The New Health Law: Bad for Doctors, Awful for Patients. Retrieved from The Institute for Healthcare
Consumerism: http://www.theihcc.com/en/communities/policy_legislation/the-new-health-law-bad-for-doctors-awful-for-pat_gn17y01k.html
Joseph P. Newhouse, P. a. (2013). Geographic Variation in Medicare Services. The New England Journal of Medicine.
References
Medicare Q & A. (n.d.). Retrieved from Budget.House.gov: http://budget.house.gov.settingtherecordstraight/medicare.htm Mehrotra, A. e. (2012). Physicians With The Least Experience Have Higher Cost Profiles Than Do Physicians With The Most
Experience. Health Affairs, 2453-2463. Neumann, P. J. (2012). Medicare's Enduring Struggle to Define "Reasonable and Necessary" Care. The New England Journal
of Medicine, 1775-1777. News Staff AAFP. (2012, 8 8). Get the 4-1-1 on CMS' Proposed Value-Based Modifier payment. Retrieved from aafp.org:
http://www.aafp.org/online/en/home/publications/news/news-now/practice-professional-issues/20120808valuebasedprop.html O'Reilly, K. (2012, 1 18). www.amednews.com. Retrieved from American Medical News:
www.amednews.com/apps/pbcs.dll.personalia/id=koreilly Pollack, R. (2011, 11 1). STATEMENT ON INPATIENT VALUE-BASED PURCHASING PROVISIONS IN FINAL OUTPATIENT
PROSPECTIVE PAYMENT RULE. Retrieved from American Hospital Association: http://www.aha.org/presscenter/pressrel/2011/110111-pr-opps.pdf
Richard A. Cooper, M. (2010). Health Care Reform From Myth to Practice. Annals of Surgery, 577-581. Shaun Frost, M. S. (2012, 9 4). Society of Hospital Medicine. Re:CMS-1524-P, Medicare Program; Revisions to Payment
Policies Under the Physician Fee Schedule, DME Face-to-Face Encounters, Elimination of the Requirement for Termination of Non-Random Prepayment Complex Medical Review and Other Revisions to Part B for C. Philadelphia, PA, USA.
Staff, N. (2011, 8 31). AAFP to CMS: 2012 Physician Fee Schedule Needs Work . Retrieved from AAFP: http://www.aafp.org/online/en/home/publications/news/news-now/government-medicine/20110831feescheduleltr.html
Stein, R. (2012, 1 3). Should Doctors Be 'Parsimonious' About Health Care? Retrieved from www.npr.org: http://www.npr.org/blogs/health/2011/12/30/144485098/should-doctors-be-parsimonious-about-health-care
Westgate, A. (2012, 7 10). Major Changes Coming to Physician Reimbursement. Retrieved from Physicians Practice: www.physicianspractice.com/print/131995
Westgate, A. (2012, 4 20). Three Problems with Medicare's Value-Based Payment Modifier. Retrieved from Physicians Practice: www.physicianspractice.com/print/132265