House Committee Asks for AAFP Input on Solving Payment Problem

May 30, 2012 03:20 pm News Staff

For the second year in a row, a key congressional committee has formally solicited the AAFP's views on ways to improve the quality and efficiency of the Medicare physician payment system, and the Academy has again provided its prescription for fixing a flawed Medicare payment system: Adopt primary care and the patient-centered medical home (PCMH) on a widespread basis.

In an April 27 letter to the Academy, the House Ways and Means Committee asked for views on a wide range of Medicare payment issues. In response, the AAFP told the committee that a health care system based on primary care will help control costs, increase patient satisfaction and improve patient health.

"Because this transformation to a health delivery system based on primary care is so important, the AAFP advocates for payment reforms that ultimately include a blended payment system for primary care delivered within the context of a PCMH," said AAFP Board Chair Roland Goertz, M.D., M.B.I., of Waco, Texas, in a letter back to the committee.

The Ways and Means Committee's request for information comes about a year after the Energy and Commerce Committee asked for similar information from the AAFP.

In this latest correspondence, the Academy said, "Comprehensive primary care that provides a patient-centered medical home environment must be central and properly valued by the system."

To accomplish this goal, the AAFP calls for a blended payment model that incorporates fee-for-service, a care management fee and incentives to achieve quality improvements. In laying out the parameters of the blended payment model, the AAFP describes the three components of the paradigm and how they should work:

story highlights

  • The House Ways and Means Committee has asked for the AAFP's views on Medicare physician payment issues.
  • In response, the Academy told the committee that primary care and the patient-centered medical home are the keys to controlling health care costs, increasing patient satisfaction and improving patient health.
  • The Academy also called for a blended payment model that would incorporate fee-for-service, a care management fee and incentives to achieve quality improvements.
  • a care management fee that compensates for expertise and time required for primary care activities, such as management and care coordination, that are not direct patient encounters;
  • fee-for-service payment for discrete services and procedures provided to patients in an ambulatory setting; and
  • pay-for-performance that rewards efforts to improve all the elements of health care and that recognizes demonstrated value to the system.

"Over time, the percent of fee-for-service payments should be decreased as the case management fee and pay-for-per-performance are increased, thus moving away from a dependence on a system that encourages volume," said Goertz. "This blended payment system for medical home teams should facilitate the transformation of practices so that all of the team's participants perform their own unique tasks in a coordinated way."

Goertz pointed out that this will require extensive investments in health information technology and interoperable systems by hospitals, health care centers and community services.

"The growing experience of family physicians in the private sector's experimentation with the PCMH points very strongly to better health and greater efficiency as a result of these investments," said Goetz.

The Ways and Means Committee also asked the AAFP about the use of quality and outcome measures. In response, the Academy reiterated its support for the PCMH, pointing out that a key feature of the delivery model is the "incorporation of quality measures and the careful monitoring of costs and patient outcomes."

The correspondence between the House Ways and Means Committee and the AAFP also addressed barriers to fundamental delivery system reform, and the AAFP cited three barriers in particular: time wasted on prior authorization paperwork, overlapping documentation, and the certification and harmonization of incentive programs.

"Another way to successfully address HHS regulatory burdens felt by family physicians would be to harmonize all of the codes, quality measures, operating rules, feedback reports and timelines associated with the Physician Quality Reporting System, Medicare electronic prescribing incentive program, and the Medicare and Medicaid electronic health records incentive programs," Goertz said.

Each of these programs was created piecemeal by separate laws, leaving physicians frustrated and confused by the inconsistencies within the incentive programs, according to Goertz.