•  Healthcare Costs Innovation Summit

    Panel: Payment Models Need More Incentives, Fewer Burdens     


    February 27, 2018 04:23 pm Michael Laff –        

    Physician payment is undergoing rapid change, but panelists at a recent event said accelerating the pace will require easing the administrative burden physicians face and fine-tuning payment models that include risk.

    Physicians and health policy analysts discussed how new payment models can reduce overall medical costs and increase quality during the Healthcare Costs Innovation Summit held in Washington, D.C., on Feb. 21. The summit was hosted by the nonprofit Gary and Mary West Health Institute.  

    "We need a population-based global payment with risk that leaves flexibility for the provider and their organization to innovate on its delivery system," said Mark Miller, Ph.D., vice president of health care for the Laura and John Arnold Foundation.  

    Miller and other speakers on a panel that addressed value-based payment models noted that CMS and private insurers want these models to rein in overall costs, but they cautioned that current approaches need retooling.

    For example, incentives in bundled payments may help keep a patient who suffered a heart attack from making a repeat hospital visit, but they would be less effective for addressing elective procedures such as joint replacement surgery. A better approach in the latter case would be to give physicians data they can use to conduct shared decision-making with the patient before a procedure begins.

    "I think we are missing the whole emphasis on cost," said Elliott Fisher, M.D., M.P.H., director of the Dartmouth Institute and professor of health policy, medicine and community and family medicine at the Dartmouth College Geisel School of Medicine in Hanover, N.H. "We need to have much better information using patient-reported outcome measures about how patients are before they get surgery."

    Fischer noted that incentive-based payment models for large patient populations are demonstrating significant progress in reducing costs in Oregon, Washington, Vermont, Massachusetts and Kansas.

    Miller said more simplified quality performance measures would help build on such successes.

    "The quality measurement process is highly overbuilt, and the reason we are losing savings is that providers have to put a lot of money into measuring and reporting these measures," he said. "We're focusing on the wrong measures. If we chose a few population-based measures like avoidable (hospital) admissions and avoidable ED (emergency department) admissions, that would be the direction to go in."

    Lewis Sandy, M.D., EVP for clinical advancement at UnitedHealth Group, said measures should include patient satisfaction.

    "We have a long way to go in health care to match the best consumer experience that people get in other parts of their lives," he said.

    Miller said patients should also have financial incentive to manage the cost of their care, and he stressed the importance of finding successful payment models.

    "Fee-for-service is not producing what people wanted in terms of expenditures and outcomes," Miller said. "We should still be moving in this direction, but we don't have a stand-up Nobel Prize model yet."

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