AOA Town Hall: New Medicare payment system rewards whole-person care

Quality of care, rather than volume, is at the heart of the new Medicare physician payment system. That’s the takeaway from an AOA town hall meeting held Thursday to explain the new system, MACRA, and hear physicians’ concerns. MACRA, which replaces the sustainable growth rate formula, begins with a period of stability from July 2015 until 2019, with physicians receiving a 0.5% payment update each year. In 2019, physicians will need to choose between two pathways:

• Use an alternative payment model that rewards coordinated care, such as an accountable care organization, bundled payments or patient-centered medical home. To sweeten the deal, CMS is offering the chance to earn shared savings, plus a 5% annual bonus from 2019-2024. Using an alternative payment model also exempts physicians from participating in the merit-based incentive program system (MIPS).



• Use the new quality-focused fee-for-service model and report through the merit-based incentive payment system, which streamlines current reporting programs for meaningful use of electronic health records, the physician quality reporting system, and the value-based payment modifier. The MIPS also includes a category for clinical improvement activities. MIPS penalties will be determined on a sliding scale, with larger bonuses and lower penalties than current CMS reporting programs. Physicians will also receive quarterly performance feedback so they can make adjustments in real time.

Ray Quintero, the AOA’s vice president of public policy, said the new payment system’s focus on quality, coordination of care and wellness aligns perfectly with the principles of osteopathic medicine. Moreover, AOA President Robert S. Juhasz, DO, said the new system addresses the conundrum at the heart of the old fee-for-service model: “How do we do the right thing and also get paid for doing the right thing?” But Dr. Juhasz cautioned that the future success of the new payment model depends on DOs’ involvement in shaping its details, including alternative payment models and the merit-based incentive system.

Town hall panelist David Hitzeman, DO, of Tulsa, Oklahoma, echoed this idea, noting that although accountable care organizations and patient-centered medical homes already treat millions of patients, payment is inconsistent because it tends to be driven by local factors. “As a profession, we need to be very involved in this process and not let policymakers and bean-counters decide everything,” he urged.