MedPACs perspective on payforperformance

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MedPACs perspective onpay-for-performance

• Sarah Thomas
• September 18, 2006

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What is MedPAC?

• 17 national experts appointed by GAO
• Makes recommendations to Congress, Secretary of
  HHS
• Votes on recommendations in public
• Mandate
• review payment policies,
• monitor quality and access,
• assess effect of changes in health care delivery
  on Medicare

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Why are incentives important in Medicare?

• Current payment system is neutral or negative
  towards quality
• Largest single purchaser
• Need to differentiate among providers

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Current Medicare efforts

• Incentives
• Public disclosure
• Demonstrations
• shared savings
• hospital pay for performance
• Other initiatives
• Feedback (QIOs and provider reports)
• Identifying measures
• Creating standardized data collection systems

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Criteria based on current efforts

• Criteria
• Well-accepted measures must be available
• Most providers or plans must be able to improve
• Need for risk-adjustment must be addressed
• Burden must be reasonable for CMS and providers

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Is it feasible to base a portion of payment on
quality?

• Criteria applied to five settings
• MA plans
• Dialysis facilities and physicians who treat
  dialysis patients
• Home health agencies
• Hospitals
• Physicians
• Four types of measures process, outcomes,
  structural and patient experience

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Design principles

• Reward both attainment and improvement
• Start with small percent of total payment
• Distribute all of pool

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Physicians

• Two-step transition
• First, quality-enhancing activities associated
  with IT, systems for
• Tracking and sending reminders
• Assuring appropriate follow-up

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Physicians (continued)

• After two or three years, add clinical process
  measures claims-based
• Encourage all specialties to develop
• Improve current stream with prescription and lab
  value data
• An entity should be the forum for choosing
  measures for Medicare and keeping measures up to
  date

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Other issues on MedPACs agenda

• Efficiency measuring resource use together with
  quality
• Care coordination measuring care across settings
  and promoting chronic care
• Sustainable growth rate identifying alternatives
  and developing ways to change incentives