Medicare exploring new primary care bonus as old program expires

January 7, 2015

The Medicare Payment Advisory Commission is working to continue some form of payment bonus to primary care physicians in light of the expiration in 2015 of the existing 10% payment boost included in the Affordable Care Act

The Medicare Payment Advisory Commission (MedPAC) is working to continue some form of payment bonus to primary care physicians (PCPs) in light of the expiration in 2015 of the existing 10% payment boost included in the Affordable Care Act (ACA).

MedPAC will draft a recommendation and vote on it later this month. When completed, the recommendation will be sent to Congress. It is expected to call for a continuation of the primary care payment boost through the use of per-beneficiary payments to PCPs, combined with a reduction in payments for non-primary care service payments to specialists.

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Non-primary services make up 75% of the services included in the fee schedule, and the MedPAC proposal calls for a 1.4% decrease in those payments, according to the American Academy of Family Physicians (AAFP).

Commissioners at the December MedPAC meeting debated whether the proposal would do enough to attract new physicians to primary care, and it was suggested that the proposal serve as a building block for further payment modifications.

The value of the existing primary care bonus payments was $664 million in 2012, with 170,000 physicians receiving the payment for 21.3 million patients, according to the AAFP. The average payment was $3,400 per year and reached as much as $9,300 per year for physicians with a high volume of Medicare patients.

The new proposal would be budget-neutral and give participating physicians $31 per year for each Medicare patient, dividing the total amount spent in 2012 by the total number of beneficiaries.

MedPAC also discussed the overall accuracy of the Medicare fee schedule based on the salary disparity between PCPs and specialists ($220,000 for PCPs versus $475,000 for non-surgical procedural specialists in a MedPAC poll), and continued discussion of the importance of Congress repealing the sustainable growth rate formula.

MedPAC also reviewed results from its own national telephone survey, which included responses from 4,000 Medicare beneficiaries and 4,000 individuals with private insurance. Most respondents (92%) reported that they are happy with their PCP, with only 2.5% reporting having problems finding a PCP.