First to dispense with the mystery, it’s all about the money and in this case, payments for physician’s services by CMS (Medicare). President Obama signed MACRA into law in 2015 and it will not be in ef-fect until 2019 but at that time the data used for payments will likely date back to Jan 2017. MACRA has no connection to the affordable Care Act (“Obama Care”) other than the signee.
The concept of health insurance can be traced through ancient China to the 11th century Norman con-quest. It entails paying for medical care while not ill so that when one is ill the care is available. The crux being in the fact that the payer and the user of the system may use the system unequally. Amer-ica resisted this well into the early 1960’s until President Johnson signed the Medicare Act into law on July 30th, 1965. The main opponents at the time were Fee-For -Service Physicians and Pharmacists who saw their incomes reduced, and Southern Democrats who opposed sharing the same hospitals with colored patients. A nobler, kinder, view was floated but perhaps did not get much traction, that Med-icare was a way for the healthier younger population to say a thank you to their predecessors and pro-vide for their health at their time of need. Never the less, Medicare held and what became an issue was how to pay for the rising costs. In the period 1980 to 1990 Physicians charges went up 13.4% per year so in 1990 Congress started paying attention and from 1992 to 1997 the increase was dialed back to 1-2 % per year. In 1997 President Clinton with a Republican controlled congress created the SGR formula in an attempt to balance the budget. What the SGR was meant to do was keep the spending on physician services tied to peaks and troughs of the GDP. Initially physicians were willing to ignore a small hit (1-2% cut back) as long as the payment from Medicare was still robust. So this was relatively unnoticed until 2002 when Medicare ‘s base payment was cut by 4.8% and there began the end of SGR’s role as a collective Physicians payment cost control. From then until 2010 a series of “doc fixes” were enacted to eliminate SGR dictated cuts including replacing it with TRHCA in 2006 which was the death knell for both SGR and itself. What followed was an extended Congressional veto of SGR with very small zero to 1% increases in Physician reimbursement. In all SGR led to cut in Physician reim-bursement only once, in 2002 when it called for a 5.4% cut. Since 2003 Congress has acted 15 times by way of last minute deprives to prevent SGR indicated cuts to physician payment.
In 2015 President Obama introduced MACRA which repealed SGR for good. MACRA was ladled out only partly cooked with the health finance sector re-inventing the wheel for physicians with mantra of rewarding quality of care while the real intent is to stem the hemorrhage of money through health care specifically aimed at physician payments. This would be meted out by two broad tracks, MIPS and APM (which consolidated four existing quality reporting systems, PQRS, Value Based Payment Modifi-er VBPM, Meaningful Use MU and Clinical Practice Improvement activities CPIA). In brief, Physicians who follow the MIPS pathway will undertake various “good behavior” models to fulfill such as PQRS, VBPM, MU and CPIA and the others who chose the APM pathway, will still be subject to some “quali-ty” measures but in essence they will assume more than nominal financial risk as they will be getting bulk payment for seeing a set volume of patients with fixed bonuses based on some quality care measures. Many professional societies are now parsing the details and the America Association Of Family Physi-cians (www.aafp.org)has a particularly detailed analysis of which path will suit which practice or group practice. Still, If all of this is still vague and confusing there is no need to feel left out, as of this writing, even the planners are stabbing wildly at fleshing out the cadaver. They release quips as they think of them and these get passed on like a game of Telephone played by hearing impaired.
Are they barking up the wrong tree? It’s not that Health care spending in America does not vastly out pace every other country in the world or that it (America) in return for all this investment only occupies a meddling position in terms of adult longevity, perinatal mortality or the Human Development Index (HDI) compared to similarly developed countries. It is not that there isn’t a place for some oversight on Physician service in a market driven health care delivery system (20% of the expense in 2015). It’s more that cuts at physician compensation have been ever present in the health cost debate but re-moved have been two of the other major players, the Hospital Industry (32 % of health care costs in 2015) and The Pharmaceutical and Device Industry (27% when combined). Add to this, the less often noted spigot draining such huge sums of money per individual, out sizing any single aspect of health care payments and which still fall within the total costs of health care carried federally and to an extent statewide, are the morbidly bloated private insurance CEO salaries. These are princely rewards to men and women whose main achievement is maximizing profits with a sideways glance at selling the affir-mation du jour. Currently something about quality.
Finally, the entire idea of measurement as a way to gauge quality of production was raised to mathe-matical precision by W.Edwards Demming (1900-1993) a master statistician and American engineer credited as the inspiration for Japanese manufacturing and post WWII reconstruction. While all the gurus of health care quality reform are quick to embrace Demming’s techniques of measurement to improve productivity they conveniently ignore his lasting homily, “Not all measurable things are good and not all good things are measurable”. We only hope that this will not be the epitaph of what once was the beacon of modern medicine.
Rohan Perera MB.,B.S, FACC, MRCP (UK)
MACRA – Medicare Access and CHIP Reauthorization Act of 2015
CHIP – The Children’s Health Insurance Program (CHIP) provides health coverage to eligible children, through both Medicaid and separate CHIP programs. CHIP is administered by states, according to fed-eral requirements. The program is funded jointly by states and the federal government.
SGR – (the Medicare) Sustainable Growth rate works to ensure that annual costs of Physician servives to Medicare beneficiaries do not exceed the annual GDP 1997-2015.
APM – Advanced Alternative Payment Model
MIPS – Merit Based Incentive Payment System
PQRS – Physician Quality Reporting System
CMS – Centers for Medicare and Medicaid Services
TRHCA – Tax Relief and Health care Act (“Trisha”)
The opinions expressed in this article are solely those of the author and have no relationship to the organization.