Get ready for private insurers to set standards for Medicare reimbursements

Doctors and patients, listen up. Starting in 2019, private insurers may hold unprecedented power in determining standards of care for Medicare patients.

To understand what’s at stake under a newly announced payment model, let’s go step by step:

  • If you are covered under Medicare, the kind of treatment you receive depends in large part on what Medicare covers in reimbursements to doctors and others.

  • Medicare has now unveiled a new payment model, which it says will “guide a clinician to follow a standard plan of care.” For you as a patient, this means that in the future, your particular treatment will likely be determined by statistics, presumably showing what works best in your circumstances.

  • Absent a uniform system of best practices, Medicare’s new model makes it possible for private insurers to set patient care standards, which Medicare will recognize by awarding physicians and other clinicians 5 percent performance incentives. Medicare further says that “positive” and “negative” payment adjustments will increase over time.

In a newly released 14-page report, titled Quality Payment Program, Medicare says this: “Clinicians could qualify for incentive payments based, in part, on…payment models developed by non-Medicare payers, such as private insurers or state Medicaid programs.” The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) set the parameters for this new payment model.

Indeed, the idea of rewarding doctors for following best practices could improve patient care and reduce wasteful spending. But what happens if the statistics are wrong?

As a tax-supported program, Medicare owes it to beneficiaries – and taxpayers – to determine best practices based on meaningful and transparent data analysis. According to an earlier government study, the nation won’t even have the advanced technology for comprehensive data analysis, and sharing of information among providers, until 2024. That report, titled A 10-Year Vision to Achieve an Interoperable Health IT Infrastructure, specifies that important lessons are yet to be learned “to improve interoperability in support of nationwide exchange and use of health information across the public and private sector.”

One complicating factor: The dismal state of Electronic Health Record (EHR) systems in use today. In 2015, 36 professional associations raised questions about the very security of patient information contained in EHRs. In a letter to the feds, the associations raised concerns about poorly functioning EHRs resulting in “medical record errors, inaccurate documentation, lack of interoperability, slow performance, lost patient information, and safety concerns.”

Separately, in a July 2013 federal government report, titled Capturing High Quality Electronic Health Records Data to Support Performance Improvement, findings point to highly functioning EHRs as key to the implementation of payment reform tied to performance measures.

“As the industry moves toward value-based reimbursement—reimbursement based on quality and cost measures—improving the quality of the data used for measurement is imperative,” the report noted.

One featured section of the report discusses a federally funded project in Rhode Island, in which goals had been set for improving the health of diabetes patients. As local medical practices began accessing EHR data in order to report on improvements in diabetes care, they discovered data quality issues due to missing or inaccessible data or wide variations in outcomes that could not be explained by the actual delivery of care.

This report, issued by the same government agency that oversee Medicare, concluded that the Rhode Island “experience highlighted the need for practices to focus resources on improving EHR data capture and quality before using results to create quality improvement strategies and tactics.”

Against this backdrop, profit-driven insurers will now be trusted to write the standards for so-called value-driven care under Medicare?

Come on. We’re talking about the federal insurance program for an estimated 55 million people 65 and older, plus those with permanent disabilities. According to the Kaiser Foundation, Medicare accounted for 14% of the federal budget in 2014, with benefit payments totalling $597 billion in tax dollars.

Far too much is at stake to move prematurely toward standardized patient care that cannot be supported by trustworthy data. The lesson from the Rhode Island project should be heeded: First figure out how to capture quality data before using statistics to determine uniform treatment methods for patients.  Treating people based on bad data could put the health of untold millions at risk.

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