Tuesday, January 27, 2015

Will Republicans now learn to hate Medicare payment reform?

HHS and CMS yesterday announced a major expansion of efforts to move Medicare payments away from fee-for-service and toward so-called value-based and bundles payments. The ACA seeded this effort with a host of pilot programs, and the administration is looking to build on the momentum generated, as HHS Secretary Sylvia Burwell writes in the New England Journal of Medicine:
As we work to build a health care system that delivers better care, that is smarter about how dollars are spent, and that makes people healthier, we are identifying metrics for managing and tracking our progress. A majority of Medicare fee-for-service payments already have a link to quality or value. Our goal is to have 85% of all Medicare fee-for-service payments tied to quality or value by 2016, and 90% by 2018. Perhaps even more important, our target is to have 30% of Medicare payments tied to quality or value through alternative payment models by the end of 2016, and 50% of payments by the end of 2018. Alternative payment models include accountable care organizations (ACOs) and bundled-payment arrangements under which health care providers are accountable for the quality and cost of the care they deliver to patients. This is the first time in the history of the program that explicit goals for alternative payment models and value-based payments have been set for Medicare.
One worry about this initiative: phasing out fee-for-service has until now been a bipartisan goal. A bipartisan "doc fix" bill to update and reform the Medicare payment structure foundered only the question of how to pay for it - necessary because the status quo baked an unsustainable "Sustainable Growth Rate," established in 1997 and "patched" with a payment hike every year, into long-term budget projections.  The doc fix would have transitioned doctors to payments based on "performance scores" and, like the HHS/CMS initiative, encouraged formation of ACOs, medical homes and other structures purporting to foster coordinated care.
With HMS and CMS now moving to make major payment changes administratively, will Republicans learn to hate value-based payment, coordinated care, bundling, etc. -- as they learned to hate state-run health insurance exchanges and the individual mandate once Democrats enacted those conservative brainchildren?  Will they damn this initiative as another instance of executive-branch usurpation?

If they want to attack the payment changes will probably offer a target-rich environment. There's bound to be a lot of devils in a lot of details in any effort to move toward value-based payment and coordinated care; it's very hard to get the incentives  and quality measures right.  Recognizing that complexity Burwell writes (with respect to new payment models for specialty care),  "we also recognize the need to continue to reach consensus on the quality measures used and address issues related to risk adjustment in these new models."

Will Republicans now start to work against such "consensus"? Stay tuned.

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