Want to Fix Medicare Pay for Primary Care Docs? How About Two Fee Schedules?

How can Medicare payments to primary care doctors be fixed? Hoangmai Pham, MD, MPH, former official at the Centers for Medicare & Medicaid Services (CMS) during the Obama administration, has a few ideas.

How about two separate fee schedules? "Rather than insisting that CMS govern fees for all physician services in one fee schedule, set up two fee schedules -- one for procedures and one for what we would call evaluation and management services," said Pham, who is now president and CEO of the Institute for Exceptional Care in Washington, D.C. "Splitting up the fee schedule that way, it gives CMS a lot more flexibility to adjust the payment for primary care without necessarily affecting payments for other services, which is often where the political pushback comes from."

Second, "give CMS new authority to create hybrid and capitated payment models for primary care," she said Thursday at an online event sponsored by the Bipartisan Policy Center. "CMS does have some existing authorities to do that in a limited way ... But to reach the majority of primary care clinicians would require an act of Congress and new authority for the agency. And with that new authority, the agency can also implement more novel ways to adjust payments for primary care to reflect the levels of need that the populations they serve have."

That would include holding physicians accountable for achieving truly meaningful outcomes, she added.

Finally, "I would point to the opportunity to look at the fee schedule prices themselves," said Pham. "There is a lot of known waste in the fee schedule ... And it's also become an incredibly complex juggernaut [with] over 8,000 codes which don't necessarily reflect meaningful differences across so many different services. No one really needs 21 codes to bill for a colonoscopy."

Instead, she said, "there is an opportunity to empower CMS to grossly simplify the fee schedule, cut it way down to be just a few hundred families of codes that together have a single billing amount and eliminate a lot of administrative burden for clinical practices that way as well."

Taking those steps would go a long way, but "if it is just a one time set of actions by Congress, it won't be sustained," Pham added. "What is really important is for Congress to empower CMS to continually and scientifically update the fee schedule with accurate data based on new data collection that the agency conducts and that is not conducted by vested interests, like professional medical associations or others. It really needs to be an effort that is as impartial as possible and that can take into account the policy priorities for the country."

Adam Myers, MD, said he achieved good results in his former position as chief of population health at the Cleveland Clinic when he moved his primary care physicians into hybrid payment models.

"When I first started there, we had very little of our payment structure in any sort of value-based payment arrangement," said Myers, who is now chief clinical transformation officer at the Blue Cross Blue Shield Association. "Over time, I met with our teams and said, 'Let's envision a different sort of care -- let's envision prospective, rather than reactive [care], relational care, team-based care.' But it was pretty clear that given the fee-for-service paradigm that we couldn't really do that, so a payment change was needed."

"So we moved rapidly into this hybrid type of arrangement ... where we had capitation for primary care," he continued. "When I started, 0% of payments were in capitation. When I left there, about 70% of the payments within primary care were capitated. It freed up for true team-based care, where people could get off the pace of seeing a patient every 15 minutes, and prospectively reach out to patients not just based on whether they'd reached out, but looking into the record and saying, 'Who needs our help?' rather than 'Who's on our schedule?'"

The result was "a game changer," said Myers. "Outcomes improved, relationships with patients improved, the engagement of our care teams improved. So I think all around changing not just what percentage gets paid toward primary care, but how that gets paid."

The way healthcare quality is measured also needs to be changed, said Robert Phillips, MD, founding executive director of the Center for Professionalism and Value in Health Care at the American Board of Family Medicine. "We're not measuring what matters in primary care," he said. "We are driving primary care doctors to distraction ... The most important value-based measures for primary care are continuity -- relationships over time -- and comprehensiveness, the ability of our team to meet most of the needs of patients. Those are the most potent measures for reducing costs, reducing utilization, and improving life expectancy."

Webinar attendees also heard from Rep. Larry Bucshon, MD (R-Ind.) about efforts in Congress to improve the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, which was aimed at rewarding physicians who got into value-based payment arrangements.

"Unfortunately, it has become evident over the last several years, that reforms to MACRA are necessary," Bucshon said in a pre-recorded address.

"Many members are interested in knowing more about how CMS makes decisions about the physician fee schedule, and what Congress could do to increase its effectiveness," he continued. "To that end. Last fall, Rep. Ami Bera, MD, of California (D) and I led a group of eight bipartisan members in soliciting feedback from providers and other stakeholders to address this issue. Our request for information received more than 130 responses, and we are in the process of going through them and sharing findings with the committees of jurisdiction."

"One thing is clear, the status quo is not sustainable," Bucshon added. "If we do not implement changes, we will continue to face an outward flow of physicians. This will lead to greater shortages than we face already, particularly in certain geographic areas and among certain specialties."

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