BPC Kicks Off Series on Delivery System Reform
The Bipartisan Policy Center's Health Project has kicked off a series of white papers on overcoming the obstacles to delivery system reform with an overview of the opportunities and challenges for reform, over a year after producing a comprehensive health care reform proposal. The white papers will be done in consultation with a diverse set of health care policy experts and stakeholders.
With the "doc fix" set to expire in April 2015, threatening to cut Medicare physician payments by about one-fifth, an opportunity exists for lawmakers to put in place a fiscally responsible replacement system. So far, the "fiscally responsible" part has been elusive, but there appears to be bipartisan consensus on at least what the framework of the replacement would be. These plans generally would establish a value-based payment system where physicians would be penalized or rewarded from year to year based on quality metrics. The plans would provide bonuses to encourage physicians to transition to alternate payment models. This first paper notes this agreement creates opportunities not only at the legislative level to create a better payment system, but also for the Centers for Medicare and Medicaid Services, who would likely be tasked with fully fleshing out the payment reforms.
The paper identifies three general alternative payment models that could be considered for physicians and the health care system more broadly: bundled payments, patient-centered medical homes, and accountable care organizations (ACOs).
All three models shift from paying for quantity to paying for quality by having providers bear some financial risk. Policymakers and policy experts are still determining how to maximize the effectiveness of each model, and BPC plans to explore each in a separate white paper.
The paper also lays out a number of challenges in transitioning to these new payment models, including having widespread participation across provider types, increasing beneficiary awareness, improving quality metrics and making metrics readily available to participants, and facilitating viable models for rural areas. Overcoming these challenges will hopefully become easier as the reforms currently under way provide more information about what works and why.
BPC's paper series promises to be an informative look at Medicare's payment system and alternatives. Policymakers should be on the lookout, since the series can enlighten them in their search for an alternative to the Sustainable Growth Rate. Hopefully, lawmakers can come to an effective, permanent solution early next year before the "doc fix" deadline.