White House Forum Promotes Transition to New Physician Payment Models

AAFP President Notes Widespread Support for Move Toward Value-based Payments

April 01, 2015 01:34 pm Michael Laff

Moving away from fee-for-service payments is a tall order that will take some time, so HHS is pledging both its support and considerable funding to support the initiative.

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AAFP President Robert Wergin, M.D., of Milford, Neb., visited the White House last week to participate in a discussion about making the transition to value-based payment systems in partnership with Medicare and private insurers. President Obama, HHS Secretary Sylvia Burwell and representatives from a number of medical organizations attended the event, which was held to launch the Health Care Payment Learning and Action Network.(innovation.cms.gov) The network is intended to be a forum for physicians, insurers and government officials to share ideas about improving care coordination and other issues involved in moving toward value-based payment.

"Many small practices are anxious about this change because it's a case of the devil they know (fee-for-service) versus the devil they don't," Wergin said. "They (HHS) understand small-practice scenarios and are focusing on how to help them with that transformation."

More than 3,350 patients, insurers, health care professionals, states, consumer groups, employers and other partners have registered to participate in the network, according to CMS. Stakeholders interested in participating can register online.(innovationgov.force.com)

Story highlights
  • AAFP President Robert Wergin, M.D., attended a recent White House event held to launch HHS' Health Care Payment Learning and Action Network.
  • HHS is offering $840 million in grants to help practices transform to embrace value-based payment models.
  • AAFP President Robert Wergin, M.D., said he learned valuable lessons about transformation at his own small practice through meetings and peer group sessions.

"People say the U.S. health care delivery system does not have a single payer, but we do," Wergin said. "It's Medicare. As Medicare moves away from volume-based care to value-based care, private insurers will follow Medicare's lead."

Wergin said he learned valuable lessons about transformation at his own small practice through meetings and peer group sessions like the ones HHS is sponsoring through the initiative. Most of the network's meetings will be held by teleconference or webinar. One meeting of the entire network will be held each year.

Last fall, HHS announced it would offer $840 million in grants to help practices transform to embrace value-based payment models as part of the Transforming Clinical Practice Initiative.(innovation.cms.gov) Funding will be offered on a regional level, so Wergin advised practices that are interested in participating to connect with their local practice association, which could apply for a grant. Wergin is a member of the South East Rural Physician Alliance in his home state.

"Small practices can be innovators," he said.

Wergin said small rural practices, in particular, need help with transformation because they do not have the resources to hire additional staff or invest in a lot of new technology.

Executives from several leading insurers participated in the White House event, pledging to support the transition to value-based payments. Such efforts have proven most effective in areas with multiple insurers, both public and private.

Gary Loveman, CEO of Caesar's Entertainment, also attended the event and discussed the company's move to a value-based payment system for its 29,000 employees. As part of that effort, a physician is available around the clock and the company has started a demonstration project that provides bundled payments for hip and knee replacements, which has resulted in reduced costs.

Wergin and a number of health care analysts have said the best reform efforts occur when multiple insurers are involved.

HHS is seeking to convert 30 percent of Medicare fee-for-service payments to alternative payment models by 2016 and 50 percent by 2018. The agency also set a goal of tying 85 percent of all Medicare fee-for-service to quality or value measurements by 2016 and 90 percent by 2018.

Several entities pledged to meet those goals. Delaware plans to have 80 percent of its population receive care in value-based payment models within five years, according to HHS. Cigna said it will have 90 percent of payments in value-based agreements and 50 percent of payments in an alternative payment model by 2018.

During the event, Obama provided an update on the Patient Protection and Affordable Care Act to mark the law's fifth anniversary. In particular, he noted that 13 million previously uninsured people had obtained health insurance.

Obama shared the story of a 28-year-old small-business owner from Philadelphia named Anne. She exercised regularly and thought she was healthy enough to live without health insurance, but her mother persuaded her to purchase a plan on the chance she could get sick or be hurt in an accident.

Just four months after obtaining insurance, she was diagnosed with early-stage stomach cancer, Obama said. She underwent surgery and received chemotherapy. Now she is recovering and planning to get married. If not for her insurance coverage, her condition likely would have gone undetected.

Obama told attendees two important lessons could be learned from this story: Listen to your mother, and obtain health insurance.

"After hearing Burwell and Obama talk, it's clear that they see the importance of primary care for both delivery and coordination of care," Wergin said. "They mentioned all the hallmarks of family medicine."

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