December 2005

Medicare payment stabilization options suggested by ACP

(Washington) – Medicare payment stabilization options were suggested to key members of Congress late yesterday in a letter from C. Anderson Hedberg, MD, FACP, president of the American College of Physicians. The options, he said, will create a pathway to longer-term reform of Medicare payment policies.

The options paper (see: http://www.acponline.org/hpp/op11-18-05.pdf) was shared earlier with Centers for Medicare and Medicaid Services (CMS) Administrator Mark McClellan, MD, PhD, FACP.

If accepted by Congress and CMS, ACP's options would stabilize payments for a minimum of two years by preventing the SGR cuts from going into effect and, beginning in 2007, by providing higher updates for physicians who voluntarily report on quality measures. It also specifies that physicians who are unable to participate in the initial voluntary reporting program should not be subjected to punitive cuts in Medicare payments (i.e. negative updates).

Also included among the options are recommendations that would create a pathway and timetable for refining and improving the voluntary measures proposed for CMS's Physicians Voluntary Reporting Program (PVRP) through the Ambulatory Care Quality Alliance (AQA), so that the PVRP could become the basis for the pay-for-reporting program in 2007.

ACP also states that expansion and continuation of the program in 2008 to include pay-for-performance will require that Congress first enact a long-term solution to the SGR. Such a long-term solution should provide predictable and stable payments that:

reflect the costs of providing services;
provide a bonus pool of dollars to physicians to be paid on a weighted basis based on performance;
create positive incentives for quality improvement (no negative updates);
allow physicians to share in system-wide savings; and
direct Medicare to implement new payment models to create incentives for physician-guided care coordination.

The College's paper also includes recommendations to address regional variations in cost and quality of care delivered to Medicare patients, to develop guidelines on appropriate use of imaging and a process to address other volume increases, and to create sustained reimbursement incentives for health information technologies to support physicians' participation in quality improvement and measurement.

The American College of Physicians is the largest medical specialty organization and the second-largest physician group in the United States. ACP members include 119,000 internal medicine physicians (internists), related subspecialists, and medical students. Internists specialize in the prevention, detection and treatment of illness in adults.