On March 4, 2013, the Commission issued a report detailing a series of recommendations aimed at reining in health spending and improving quality of care by fundamentally changing the way doctors are paid.
The Commission’s 12 recommendations provide a five-year blueprint for transitioning to a blended payment system that will yield better results for both public and private payers, as well as patients.
READ THE FULL REPORT
Watch the March 4 Capitol Hill briefing.
Recommendations of the National Commission on Physician Payment Reform:
- Over time, payers should largely eliminate stand-alone fee-for-service payment to medical practices because of its inherent inefficiencies and problematic financial incentives.
- The transition to an approach based on quality and value should start with the testing of new models of care over a 5-year time period, incorporating them into increasing numbers of practices, with the goal of broad adoption by the end of the decade.
- Because fee-for-service will remain an important mode of payment into the future, even as the nation shifts toward fixed-payment models, it will be necessary to continue recalibrating fee-for-service payments to encourage behavior that improves quality and cost-effectiveness and penalize behavior that misuses or overuses care.
- For both Medicare and private insurers, annual updates should be increased for evaluation and management codes, which are currently undervalued. Updates for procedural diagnosis codes should be frozen for a period of three years, except for those that are demonstrated to be currently undervalued.
- Higher payment for facility-based services that can be performed in a lower-cost setting should be eliminated.
- Fee-for-service contracts should always incorporate quality metrics into the negotiated reimbursement rates.
- Fee-for-service reimbursement should encourage small practices (those having fewer than five providers) to form virtual relationships and thereby share resources to achieve higher quality care.
- Fixed payments should initially focus on areas where significant potential exists for cost savings and higher quality, such as care for people with multiple chronic conditions and in-hospital procedures and their follow-up.
- Measures to safeguard access to high quality care, assess the adequacy of risk-adjustment indicators, and promote strong physician commitment to patients should be put into place for fixed payment models.
- The Sustainable Growth Rate (SGR) should be eliminated.
- Repeal of the SGR should be paid for with cost-savings from the Medicare program as a whole, including both cuts to physician payments and reductions in inappropriate utilization of Medicare services.
- The Relative Value Scale Update Committee (RUC) should make decision-making more transparent and diversify its membership so that it is more representative of the medical profession as a whole. At the same time, CMS should develop alternative open, evidence-based, and expert processes to validate the data and methods it uses to establish and update relative values.