MedPAC takes aim at outcomes-based payment programs
The shift to value and outcomes-based payment was thrown a curveball last week when an influential congressional advisory panel recommended curtailing some federal programs aimed at pushing providers in exactly that direction.
First, the Medicare Payment Advisory Commission recommended doing away with the Merit-based Incentive Payment System, or MIPS. A day later, the commission said it is working on a proposal to have Congress eliminate the Inpatient Quality Reporting Program and the Hospital Acquired Condition Reduction Program. It will also ask that the Hospital Readmissions Reduction Program and the Hospital Value-Based Purchasing Program be merged into one new program called the Hospital Value Incentive Program.
“There are currently too many overlapping programs, which creates unneeded complexity for Medicare and for hospitals,” Ledia Tabor, a policy analyst at MedPAC, said Oct. 6 during a meeting. “For simplicity, hospitals should have their payment adjusted under one program as opposed to separate programs.”
The new program would score hospitals based on readmissions, mortality and spending rates as well as patient experience while in care. It would account for the fact that some hospitals have more higher-need patients than others by placing hospitals in peer groups. All Medicare hospitals would have 2% of reimbursement withheld. Hospitals that do better than others in their peer groups would receive a bonus greater than what was withheld from them,
“There are currently too many overlapping programs, which creates unneeded complexity for Medicare and for hospitals.” Ledia Tabor Policy analyst at MedPAC
and hospitals that perform poorly will receive back less than what was withheld from them.
Most notably, however, the new model would not hold hospitals financially accountable for infections patients develop while in their care. There’s been frustration within the industry that hospitals are held accountable for too many false positives or negatives.
The CMS said the 769 hospitals with the highest rates of hospital-acquired conditions had their Medicare payments cut in fiscal 2017. The Association of American Medical Colleges estimated hospitals lost about $430 million in total as a result of the Medicare payment cuts, which was 18% more than the prior fiscal year.
On the physician side, commissioners contended that MIPS is too much of a burden and doesn’t drive improvements in care.
“Time is of the essence to develop an alternative for MIPS,” said David Glass, principal policy analyst at MedPAC. It “will not achieve the goal of identifying and rewarding high-value clinicians.”
Under MIPS, physician pay is based on success in four performance categories: quality, resource use, clinical practice improvement and “advancing care information” through use of health information technology. The advancing care criteria is based on the government’s meaningful use program, which is used to decide whether doctors should be rewarded for using EHRs.
The CMS estimates that up to 418,000 physicians will be submitting 2017 MIPS data.
But MIPS is severely flawed, according to MedPAC. It is designed primarily to measure processes, such as whether a doctor ordered appropriate tests or followed general clinical guidelines, rather than if patient care was ultimately improved by that provider’s actions.
“We really have to get rid of MIPS,” said Dr. Rita Redberg, a commissioner and cardiologist at the University of California at San Francisco. “No one went into medicine to check all these boxes.”
Another flaw, according to MedPAC, is MIPS lets clinicians choose the measures under which they’re evaluated. The worry is they’ll choose measures on which everyone tends to perform well.
The CMS estimated that providers will spend over $1 billion to track and report under MIPS in the 2017 calendar year. That’s too much money compared to what could be saved or even the rewards that providers could get, the panel said. MACRA only allows for up to $500 million each year in positive pay adjustments for performing well under the system.
In place of MIPS, the panel suggested that all Medicare physicians not in an alternative-payment model, or APM, would have 2% of their payments withheld. The CMS estimated that 180,000 to 245,000 clinicians will be in an APM by the end of 2018.
While not a policy-creating body, MedPAC is an influential voice for both Congress and the CMS. Most recently, its site-neutral policy for hospital off-campus facilities was finalized in a rulemaking last year.