Medicare Compliance & Reimbursement

Testimony flies from 3 sides as Congress strives to improve the program.

In Washington, DC last week, federal officials and physicians testified on how to get more value out of the Medicare program while preventing excess spending.

During the session, Congress heard federal pleas for more performance-based physician payment measures. Physicians, meanwhile, were concerned about how pending physician pay cuts would affect patient care.

On Nov. 17, the House Energy and Commerce Health Subcommittee heard testimony from the Centers for Medicare and Medicaid Services, the Medicare Payment Advisory Commission and the American Medical Association on the state of the Medicare program. Lawmakers will take the testimony into account as they work toward Medicare legislation that has become necessary in the face of skyrocketing costs.

"As a growing number of stakeholders now agree, we must increase our emphasis on payment based on improving quality and avoiding unnecessary costs," CMS administrator Mark McClellan testified.

P4P Among Quality Measures MedPAC Proposed

During testimony, MedPAC chairman Glenn Hackbarth outlined several ideas to improve Medicare's program value, including:

• a new payment update method. Hackbarth proposed a "year-to-year evaluation of payment adequacy to determine the update."

• P4P measures. Medicare should differentiate providers through P4P "as a way to improve the quality of care. Currently, Medicare pays providers the same regardless of their quality or use of resources--Medicare should pay more to physicians with higher-quality performance and less to those with lower-quality performance," Hackbarth reasoned.

• measuring physician resource use "when serving beneficiaries and providing information about practice patterns confidentially to physicians," MedPAC suggested.

In addition to the listed proposals, encouraging use of information technology and reforming the payment system for imaging services "can help Medicare beneficiaries receive high-quality, appropriate services and improve the value of the program," Hackbarth said.

AMA: Quality Measures, Pay Cuts Don't Mesh

In testimony on the AMA's behalf, board chair Duane Cady said that physicians want quality improvements, but not under the current physician pay formula. Expecting doctors to improve care while simultaneously dealing with a payment cut is a recipe for disaster, Cady argued.

"At the same time that the [physician pay] cuts begin, Congress is considering linking quality improvements to Medicare payments through value-based purchasing legislation. The AMA is a longtime leader in helping physicians improve quality ... [but] value-based purchasing is not compatible with the current Medicare physician payment formula," he said.

Congress should hold off on value-based purchasing ideas "until the physician payment formula is repealed and a stable Medicare payment system that reflects increases in physician practice costs is in place," Cady testified.
 
McClellan's take: CMS may feel physicians' pain when it comes to pending pay cuts, but the agency also sees the need for more of the performance-based payments that MedPAC endorsed. P4P measures are vital to improving Medicare, McClellan said during his testimony. "The government is striving for a healthcare system that ensures appropriate payments for providers, while also promoting the highest quality of care, without increasing overall Medicare costs." To achieve those goals, McClellan said P4P measures work best.
 
But McClellan also reported that the physician payment system needs adjustments before P4P starts or trouble could soon follow for beneficiaries.