The future of physician payment?

The start of a new year is often a time to look ahead and try to foresee the future. As I do that this January with respect to physician payment, I see “value-based purchasing” on the horizon.

What is “value-based purchasing?” Good question. I do not have a definitive answer, but I can tell you that the folks in the Centers for Medicare & Medicaid Services (CMS) view it as something that “aligns payment more directly to the quality and efficiency of care provided by rewarding providers for their measured performance across the dimensions of quality.”

And this is not just idle musing, either. By law, the Secretary of Health and Human Services is to develop a plan to transition to a value-based purchasing program for Medicare payment for covered professional services (including physician services) and submit a report to the Congress no later than May 1, 2010. To that end, CMS held a public listening session on this topic on Dec. 9, 2008, and has released an issues paper for review and comment.

What this all means for physician payment is not yet clear. However, I can imagine a day in the not-too-distant future when Medicare and other payers rely less on “fee-for-service” and more on what we have heretofore called “pay-for-performance.” In the meantime, it may be wise to keep an eye on CMS’s plans for transitioning to “value-based purchasing” as an indicator of things to come.