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Doctors suggest ways to improve Medicare for physician payments, patient care


Senators hear possibilities about nation’s single largest health care payer.

© Senate Finance Committee

Witnesses prepare to testify April 11, 2024, at the Senate Finance Committee hearing, “Bolstering Chronic Care through Medicare Physician Payment.”
© Senate Finance Committee

Treatment plans and physician payment must evolve as Medicare covers an aging population dealing with chronic conditions, said experts who testified before national lawmakers.

A renewed focus on primary care is a key to strengthening the Medicare system, said Stephen Furr, MD, FAAFP, president of the American Academy of Family Physicians. He was one of four witnesses who spoke to the Senate Finance Committee in the April 11 hearing, “Bolstering Chronic Care through Medicare Physician Payment.”

The committee spent almost two hours discussing Medicare’s widescale transition from acute care to chronic care management. The system started as a way for seniors to receive health care for conditions such as a broken ankle or a bad case of the flu, but “that is no longer Medicare today,” said Sen. Ron Wyden (D-Oregon), committee chairman.

“Medicare is overwhelmingly about chronic conditions cancer, diabetes, heart disease, stroke COPD, you all know the list,” Wyden said. “And what we know is that if you don't figure out ways to pull these services together, as I mentioned, you have this crazy quilt of appointments and prescriptions and care plans, that lead to confusion and particularly worse health care. When a senior's health gets this complicated, care coordination is not an option.”

More than 60 million people rely on Medicare to meet their health care needs and that population will grow by more than 20% over the next decade, said Sen. Mike Crapo (R-Idaho), committee ranking member. The hearing highlighted the urgency of advancing durable clinician payment reforms for physicians, other health care providers, and patients, he said.

“In the absence of proactive policy changes, tens of millions of seniors will suffer the consequences,” Crapo said. “The risks of inaction range from surges in wait times and delays including for critical care. To clinician office closures and cutbacks in provider participation. Our committee has an obligation to strengthen the Medicare program and divert these unacceptable outcomes.”

In the last 20 years, the Medicare Physician Fee Schedule payments have declined by more than 25%, Crapo said, citing a figure that has become known in the public discourse about U.S. health care. Not just in primary care – he cited chemotherapy and IV infusions in cancer care.

Medicare Physician Fee Schedule reform should shift away from the status quo and move toward models that promote and reward team-based, patient-centered approaches, Crapo said.

Monthly payments for primary care

Chronic disease may be the single most important challenge facing Medicare, with more than two-thids of the Medicare population having two or more chronic conditions, said Amol Navathe, MD, PhD, an internist and health economist. Navathe also is vice chairman of the Medicare Payment Advisory Commission (MedPAC).

Patients are dealing with fragmented care for their chronic conditions, and the current fee-for-service payment systems is a key factor in producing that fragmentation, Navathe said.

The solution is not to add more billing codes that don’t cover administrative costs. Instead, Medicare patients and physicians would benefit from steady monthly payments per beneficiary to primary care physicians, Navathe said. Another promising approach is to continue expansion of alternative payment models that place accountability for cost and quality outcomes onto physicians and other clinicians, which will require continued support from the Innovation Center of the U.S. Centers for Medicare & Medicaid Services, Navathe said.

Better physician pay

Overwhelming administrative burden is taking time away from patient care. It is discouraging physicians to leave the field and discouraging medical students from pursuing primary care, Furr said. American patients are the least likely worldwide to have a longstanding relationship with a primary care physician. The U.S. health care system as a whole undervalues primary care and low-cost, high-value services such as preventive screenings that it can provide, Furr said.

Improving fee-for-service payment for primary care would support the acceleration to value-based payment for primary care, as long as alternative payment models are designed on fee-for-service payment rates, Furr said.

Congress also should revise Medicare’s current budget neutrality requirements and should waive patient cost-sharing requirements for chronic care management and other primary care services, Furr said.

Budget neutrality

Medicare’s budget neutrality trigger threshold should be increased from the current $20 million to $100 million to account for inflation, said Patricia L. Turner, MD, MBA, FACS, executive officer and CEO of the American College of Surgeons. The budget neutrality trigger has remained the same since 1992, she said.

The U.S. health care system would benefit from CMS and experts committed to improving the way quality is measured and incentivized and by improving the calculus of the Medicare Physician Fee Schedule, Turner said. ACS envisions quality as a comprehensive program centered on patients and including a team of primary care and specialist providers.

To ensure immediate stability, Congress also should act immediately to address physician payment reductions anticipated for 2025, Turner said.

Accountable care

Accountable care is working, with accountable care organizations (ACOs) collectively saving Medicare a total of $22 billion over the last decades, said Melanie Matthews, CIE of Physicians of Southwest Washington (PSW).

Cost savings have been the headline, but the underlying strategies of ACOs also improve care for people, especially those who are chronically ill, Matthews said.

In team care, nurses collaborate closely with patients, their families, physicians, social workers, pharmacists, and other health care professionals as needed. Those programs would not be possible under fee-for-service models, Matthews said.

Incentives also help patients. For example, PSW offered a chronic care management program for chronic obstructive pulmonary disease, but enrollment was low due to beneficiary co-insurance payments. Implementing a cost-sharing waiver remedied that issue, Matthews said.

Patients in need

Navathe, Furr and Matthews used anecdotes to explain recent experiences with patients.

Furr described a patient, Caroline, who has diabetes and hypertension and who had a kidney transplant. With no blood flow from her knee down, she was to see a vascular surgeon last week in hopes of saving her leg.

Navathe discussed, a patient, Mr. L, suffering from diabetes, heart failure and kidney disease. He spends an average of two hours a day coordinating medications, traveling to clinics and attending appointments, and would benefit from a more proactive, patient-centered model of care.

Matthews explained how a patient was sent home from a skilled nursing facility with instructions for wound care. When a home health provider did not have proper supplies to care for the wound, the patient was planning to return to the emergency department for treatment. Instead, PSW’s ACO nurse care manager checked in with the patient by telephone and connected the patient with another home health provider with adequate supplies and immediate availability, thus avoiding the cost of the hospital trip.

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