Medicare Compliance & Reimbursement

Medicare can't keep up with rapid technological advances, MedPAC says.

Providers must become more accountable for the quality of the care they provide--and Medicare must take the reigns, the influential Medicare Payment Advisory Commission (MedPAC) says.

In MedPAC's "Report to Congress: Increasing the Value of Medicare," which it released on June 15, the advisory body had some strong suggestions for the Centers for Medicare & Medicaid Services (CMS). The report cited improving accountability, care coordination and pricing accuracy among the top concerns regarding Medicare. The commission also acknowledged the biggest change in Medicare in recent years as being the advent of Part D and private plans' involvement in the Medicare program.

"Providers must be held accountable for the quality of care they provide and the resources consumed in providing that care," MedPAC charges. Pay-for-performance programs are the first step, and measuring physician resource use is the second, the report says.

But making individual physicians more accountable for providing high-quality care is not enough, the report points out. Care coordination is the real key to improving the Medicare program's value. "Overall care for a beneficiary may be sub-optimal if providers do not coordinate across settings or assist beneficiaries in managing their conditions between visits," MedPAC notes.

To integrate care coordination into fee-for-service Medicare for chronically ill benes, MedPAC used two models. The first model used group practices to deliver care coordination, and the second used "stand-alone care management organizations."

"In both models, organizations would be required to have information technology and care manager capacities and would agree initially to cost savings as a condition of payment," the report says.

Medicare's Information Flow Is Running Too Dry, Report Claims

In addition to care quality initiatives and P4P, MedPAC's report included a laundry list of information-delivery improvements for CMS. "Medicare policymakers and administrators need better information to formulate policies and to create tools to give useful information to beneficiaries and providers," MedPAC says. Despite this somewhat vague idea, the commission went on to list quite specific follow-up recommendations, including:

1. CMS should develop and test measures related to fall prevention and wound care in home health agencies and add them to the home health measure set.

2. CMS needs to collect better information about benes' outpatient therapy needs and their outcomes. "Specifically, CMS will need to develop patient assessment tools that report risk factor information and outcomes measures," MedPAC explains. "This would help evaluate alternative payment methods that could increase the value of the therapy services Medicare purchases."

3. Medicare needs to keep up with technological advances, the commission says. "A pressing issue for Medicare is that technology diffuses rapidly without sufficient analysis or guidelines that target its use to the patients who will benefit the most."

Another major problem that MedPAC discussed in its report to Congress was payment accuracy. Medicare payments for individual services might be inaccurate, the commission notes. "Adding case-mix adjusters to the number of days in the current hospice service payment categories did not improve the ability to predict variation in labor costs," the report reveals.

And MedPAC also discovered problems with practice expense payments. When the commission reviewed "the data sources that CMS uses to derive practice expense payments in the physician fee schedule," it found that "current data are outdated and the Congress should provide CMS with the financial resources and administrative flexibility to collect new data and compute practice expenses," the report says.

The message from MedPAC in its report was clear and somewhat ominous: If the federal government doesn't control Medicare spending, the program won't be sustainable. "The longer action is delayed, the more draconian the remedies that will eventually be required," the commission warns.

To read MedPAC's report, go to http://www.medpac.gov/publications/congressional_reports/Jun06_EntireReport.pdf.