Health payment and your health

Summer 2018 has been rough on hopes that somehow changes in health care payment systems might somehow reduce health care costs, dramatically improve care coordination and quality and promote access to care. Accountable Care Organizations (ACOs)[1] are fine but not yet changing the world. Implementation of the Merit-based Incentive Payment System (MIPS)[2] has been criticized and subject to change.[3] Most recently, a study of Medicare’s Bundled Payments for Care Improvement (BPCI) initiative found it improved neither quality, efficiency nor cost reductions distinctly from nonparticipants. Rather, it indicated systems inclined to participate in such things can and do.[4]

Let it be known that alternative payment models are not magical unicorns. They are Newtonian in that they inevitably generate equal and opposite reactions from elsewhere in the health sector.

But now the next thing is up and out – the 2019 Medicare physician fee schedule proposed rule[5] – and it deserves attention. Published July 12 and open for public comment through Sept. 10, the proposal makes substantial adjustments to Medicare payment for office visits, continues implementation of the Quality Payment Program (QPP) MIPS initiative and of Advanced Payment Models (APMs), and authorizes some professionals enrolled in Medicare Advantage (MA) risk-sharing systems to be exempted from MIPS participation, penalties and benefits.

·       Overall Medicare conversion factors rise only slightly notwithstanding other policy change. The 2019 PFS conversion factor is $36.0463, up 4.67c from the 2018 factor. The separate conversion factor for anesthesia is $22.2986, up 10.99c from the 2018 factor.

·       Change to payment for office visits has drawn the most attention, notably from a July 22 article in the New York Times.[6]  By consolidating payment variation in office visit levels to one blended Medicare payment, “Medicare payment rates for new patients now range from $76 for a Level 2 office visit to $211 for a Level 5 visit,” wrote the Times’ Robert Pear. “The Trump administration proposal would establish a single new rate of about $135. That could mean gains for doctors who specialize in routine care, but a huge hit for those who deal mainly with complicated patients.” The rule preamble demurs on the scare talk, saying that most specialties would see no to little Medicare payment change considering the rest of the rule, within a window of -4% to +4%.[7]  

·       Further implementation of the QPP pay-for-quality initiative triggers 2021 MIPS payments and penalties based on Medicare claims and data submitted in 2019, which is the program’s performance year 3. Newly eligible to report data to MIPS in 2019 under the proposal are physical therapists, occupational therapists, clinical social workers and clinical psychologists. More broadly, of 1.52 million clinicians CMS counts, about 218,000 are required to participate in MIPS or face a penalty. An additional 389,000 may submit data as a group, and 42,000 more may opt-in to MIPS, for a grand total 650,000 eligible or required to participate.[8] The MIPS low-volume threshold shifts a bit but affects only 1,173 clinicians.[9]  The proposal also raises the bar  to meet MIPS performance and high-performance thresholds needed to avoid penalties and secure positive payment adjustments. The agency estimates 95% or 618,000 of all MIPS-eligible clinicians will submit 2019 data and 96% of those will see neutral or positive payment adjustments averaging 2% in 2021. The 5% or 31,000 clinicians not submitting 2019 data would see average 6% Medicare payment penalties in 2021.

Do you and your stakeholders know what’s at stake? Among whom ought your voice be heard? What should you say?

In another time on another issue another President said “trust but verify,”[10] the beginning of wise counsel on this issue. The rest is that practices should check their situations and be heard in Washington. After all, we are here because our paranoid ancestors avoided entering the sabre-tooth tiger food chain.

Frank Talk is a product of Cardinal Waypoint LLC, a new consultancy for health policy and leadership. You can have Cardinal Waypoint at work for you. Contact Cardinal Waypoint here.

[1] CMS. Accountable Care Organizations. May 3, 2018. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ACO/, retrieved 7/25/2018.

[2] CMS. MIPS Overview. Undated. https://qpp.cms.gov/mips/overview, retrieved 7/25/2018.

[3] For example, Dickson V. CMS agrees with complaints about MACRA, agency will ask providers for ideas to measure outcomes. Modern Healthcare, Oct. 13, 2017. http://www.modernhealthcare.com/article/20171013/NEWS/171019931, retrieved 7/25/2018.

[4] Oseran A et al. Factors associated with participation in cardiac episode payments included in Medicare’s Bundled Payments for Care Improvement initiative. JAMA Cardiol. June 27, 2018. https://jamanetwork.com/journals/jamacardiology/article-abstract/2686124, retrieved 7/25/2018.

[5] CMS. Details for title CMS-1693-P, proposed rule revisions to payment policies under the Medicare physician fee schedule, quality payment program and other revisions to Part B for CY 2019. July 12, 2018. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices-Items/CMS-1693-P.html, retrieved 7/25/2018. This file includes 25 downloadable directories of data used to formulate or further describe the rule, plus the actual proposed rule placed on display in the Federal Register public inspection file. As of July 25, the rule had not been posted in the actual Federal Register, so it has no traditional volume and page citation until it is published July 27. Subject to public comment through Sept. 10, 2018. The public comment interface is located at https://www.regulations.gov/document?D=CMS-2018-0076-0001, retrieved 7/25/2018.

[6] Pear R. Sniffles? Cancer? Under Medicare plan, payments for office visits would be the same for both. New York Times, July 22, 2018. https://www.nytimes.com/2018/07/22/us/politics/medicare-payments-trump.html, retrieved 7/25/2018.

[7] Within the proposal, Table 21 (p. 365 in the display version) flags for unadjusted gains podiatry (12%), dermatology, hand surgery, otolaryngology, orthopedic surgery, and oral / maxillofacial surgery (4 to 7%). It estimates cuts would come to endocrinology (-10%), hematology / oncology, neurology, rheumatology and geriatrics (-4 to -7%), and to cardiology, internal medicine, nephrology, pediatrics and pulmonary disease (all <3%). Considering other Medicare payment and coding adjustments, Table 22 (p. 367) changes the list of winners to include obstetrics / gynecology (4%) and nurse practitioner (3%), plus hand surgery, interventional pain management, optometry, physician assistant, psychiatry and urology (all <3%). The losing list is podiatry and dermatology (-4% - and among the winners on the unadjusted list), rheumatology, radiation oncology and radiation therapy centers, pulmonary disease, otolaryngology, neurology, hematology / oncology, audiologist, and allergy / immunology (all -3% or less).

[8] Table 96 of the proposed rule (p. 1076 in the display version).

[9] Table 97 of the proposed rule (p. 1078 in the display version).

[10] https://www.youtube.com/watch?v=yfZ5fa5bPJU, retrieved 7/25/2018.