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JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicare’s New Value-Based Payment Modifier

JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

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Page 1: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

JENNIFER L . GWILYM, DOHEALTH POLICY FELLOWSHIP

SEPTEMBER 20 , 2013

Impact of Medicare’s New Value-Based Payment Modifier

Page 2: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Value-Based Payment Modifier

Replace Fee for Service Medicare (2015)Complex calculation based on cost profiles

and quality data of physicians

http://www.acepnews.com/news/news-from-the-college/single-article/physician-value-based-payment-modifier-starts-in-2015/

Page 3: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Value-Based Payment Modifier

http://www.the-hospitalist.org/details/article/3782371/John_Nelson_Peformance_Key_to_Federal_Value-Based_Payment_Modifier_Plan.html December 2012

Page 4: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Medicare’s Financial Challenges

Covers “Reasonable and necessary” servicesProblems: More beneficiaries qualify,

healthcare is more costly, fewer workersCBO: Medicare Part A will be bankrupt in

202025% 65 and over living FPL in 1965 – now

half of beneficiaries live in povertyAverage lifespan 1965 was 70 y/o, now 78.5

years

Page 5: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Decreases in Tax Revenue Impact Medicare

Originally, payroll tax 2.9% of all wage earners, split by employee and employer

2013 ACA mandates persons making over $250,000 will pay 3.8%

1965: 4.6 taxpayers

per retiree

2013: 3.7 taxpayers

per retiree

2030: 2.4 taxpayers

per retiree

Page 6: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

New Physicians’ Cost profiles

Physicians with less than 10 years experience have a 13.2% higher cost profiles than physicians who have been practicing for over 40 years

Possible reasons: Newer and more expensive treatment modalities More aggressive care due to lack of experience Shorter relationships with their patients Less-experienced may treat sicker patients or more

non-compliant patients Health Affairs, 2012

Page 7: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Experienced Physicians’ Practice Patterns

Physicians in practice longer

May provide lower-quality carePosses less factual knowledgeLess likely to adhere to appropriate standards of careMay have poorer patient outcomesLess likely to adopt new proven therapies Exempt from recertification requirements

Systematic Review, 2005

Page 8: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Unintended Consequences of VBPM

Decrease access to new physicians to provide access to quality care for patients

Force new physicians to modify their practice patterns

New physicians in training programs would be concerned with their cost profiles instead of learning to practice medicine, resulting in less familiarity with certain procedures

Page 9: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Decreased Medicare Reimbursement

Physicians will have to see more patients on a daily basis, therefore, spend less time with each

Medicare reimburses 81% of private insuranceSustainable Growth Rate (SGR)Increased bureaucracy, additional paperwork, more

oversight, less autonomy = job dissatisfactionIncrease physician shortage-retire or switch careersDeter people from pursing medicine as a career

Page 10: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Recommendations

Delay implementation of VBPM until guidelines are written and simplified

Post on Health Compare WebsiteEncourage ‘parsimonious care’ – accept some

responsibility for the cost of careCalculate cost profiles incurred during

practice, not during residency

Page 11: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

Questions?

[email protected]

Page 12: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

References

Background Medicare Value-Based Payment Modifier. (2012, 12 31). Retrieved from CMS.gov: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Background.html

Executive Summary-AOA. (2012, 9 4). 2013 Medicare physician Fee Schedule Proposed Rule Summary of AOA Recommendations. American Osteopathic Association (AOA).

Value-Based Payment Modifier. (2012, 31 12). Retrieved from CMS.gov: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/ValueBasedPaymentModifier.html

al., N. K. (2005). Systematic Review: The Relationship between Clinical Experience and Quality of Health Care. Annals of Internal Medicine, 260-273.

Anita Arora, M. e. (2012). hat Kind of Physician Will You Be? Variation in Health Care and its Importance for Residency Training. The Dartmouth Institute.

Bell, M. (2013, 3 4). Why Your Children Won't Have Medicare. Retrieved from Forbes.com: http://www.forbes.com/sites/michaelbell/2013/03/04/why-your-children-wont-have-medicare/

CMS. (2012, 12 31). Medicare FFS Physician Feedback Program/Value-Based Payment Modifier. Retrieved from Centers for Medicare & Medicaid Services: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Background.html

Cooper, R. a. (2009). States with More health Care Spending Have Better-Quality Health Care: Lessons About Medicare. Health Affairs, 103-115.

Dunn, L. (2011, 8 31). AHA: Value-Based Purchasing Programs Fail to Meet Requirements Set Forth by ACA. Retrieved from Becker's Hospital Review: http://www.beckershospitalreview.com/hospital-management-administration/aha-value-based-purchasing-programs-fail-to-meet-requirements-set-forth-by-aca.html

Elliott Fisher, M. M. (2009, 2 27). Health Care Spending, Quality, and Outcomes More Isn't Always Better. A Dartmouth Atlas Project Topic Brief. The Dartmouth Institute.

Fiegl, C. (2012, 9 17). Medicare Modifier Could Hit Unsuspecting Doctors with Pay Cuts. Retrieved from amednews.com: http://www.ama-assn.org/amednews/2012/09/17/gvl10917.htm

Fisher ES, W. H. (1999). Avoiding the unintended consequences of growth in medical care: How might more be worse? JAMA, 446-453.

Jason Fodeman, M. (2011, 4). The New Health Law: Bad for Doctors, Awful for Patients. Retrieved from The Institute for Healthcare Consumerism: http://www.theihcc.com/en/communities/policy_legislation/the-new-health-law-bad-for-doctors-awful-for-pat_gn17y01k.html

Joseph P. Newhouse, P. a. (2013). Geographic Variation in Medicare Services. The New England Journal of Medicine.

Page 13: JENNIFER L. GWILYM, DO HEALTH POLICY FELLOWSHIP SEPTEMBER 20, 2013 Impact of Medicares New Value-Based Payment Modifier

References

Medicare Q & A. (n.d.). Retrieved from Budget.House.gov: http://budget.house.gov.settingtherecordstraight/medicare.htm

Mehrotra, A. e. (2012). Physicians With The Least Experience Have Higher Cost Profiles Than Do Physicians With The Most Experience. Health Affairs, 2453-2463.

Neumann, P. J. (2012). Medicare's Enduring Struggle to Define "Reasonable and Necessary" Care. The New England Journal of Medicine, 1775-1777.

News Staff AAFP. (2012, 8 8). Get the 4-1-1 on CMS' Proposed Value-Based Modifier payment. Retrieved from aafp.org: http://www.aafp.org/online/en/home/publications/news/news-now/practice-professional-issues/20120808valuebasedprop.html

O'Reilly, K. (2012, 1 18). www.amednews.com. Retrieved from American Medical News: www.amednews.com/apps/pbcs.dll.personalia/id=koreilly

Pollack, R. (2011, 11 1). STATEMENT ON INPATIENT VALUE-BASED PURCHASING PROVISIONS IN FINAL OUTPATIENT PROSPECTIVE PAYMENT RULE. Retrieved from American Hospital Association: http://www.aha.org/presscenter/pressrel/2011/110111-pr-opps.pdf

Richard A. Cooper, M. (2010). Health Care Reform From Myth to Practice. Annals of Surgery, 577-581. Shaun Frost, M. S. (2012, 9 4). Society of Hospital Medicine. Re:CMS-1524-P, Medicare Program; Revisions to

Payment Policies Under the Physician Fee Schedule, DME Face-to-Face Encounters, Elimination of the Requirement for Termination of Non-Random Prepayment Complex Medical Review and Other Revisions to Part B for C. Philadelphia, PA, USA.

Staff, N. (2011, 8 31). AAFP to CMS: 2012 Physician Fee Schedule Needs Work . Retrieved from AAFP: http://www.aafp.org/online/en/home/publications/news/news-now/government-medicine/20110831feescheduleltr.html

Stein, R. (2012, 1 3). Should Doctors Be 'Parsimonious' About Health Care? Retrieved from www.npr.org: http://www.npr.org/blogs/health/2011/12/30/144485098/should-doctors-be-parsimonious-about-health-care

Westgate, A. (2012, 7 10). Major Changes Coming to Physician Reimbursement. Retrieved from Physicians Practice: www.physicianspractice.com/print/131995

Westgate, A. (2012, 4 20). Three Problems with Medicare's Value-Based Payment Modifier. Retrieved from Physicians Practice: www.physicianspractice.com/print/132265