On May 17, 2024, the Senate Finance Committee released a long-anticipated bipartisan white paper entitled Bolstering Chronic Care Through Physician Payment: Current Challenges and Policy Options for Medicare Part B. Informally, responses to the ideas in the white paper and questions posed are due back to the Committee by June 14, 2024.?
In addition, the House Ways & Means Subcommittee on Health will hold a hearing this Thursday, May 23, entitled, The Collapse of Private Practice: Examining the Challenges Facing Independent Medicine, which means we may (key word may) have a bicameral dynamic on our hands indicating even greater momentum and seriousness.
In 2015, in overwhelming bipartisan fashion, Congress passed the Medicare Access and CHIP Reauthorization Act (MACRA). MACRA reformed Medicare payment and replaced what was known then as the Sustainable Growth Rate (SGR) with a new set of payment mechanisms. The new payment mechanisms include the two-track Quality Payment Program (QPP) which emphasizes value-based payment in the form of Advanced Alternative Payment Models (A-APMs) and the Merit-based Incentive Payment System (MIPS) .?
While well intentioned, MACRA has never functioned smoothly, especially when it comes to the administrative reporting burden for physicians within MIPS. In addition, the constant congressional fight to “patch” the SGR - a primary reason for repealing it - has been replaced with another recurring legislative battle, paying out the annual 5% bonus to physicians participating in APMs. In fact, due to cost concerns, at the end of 2023, Congress actually reduced for 2025 the bonus to 3.5% which is set to be lowered further in 2026 to .75%,? likely necessitating yet another round of temporary legislative fixes.?
Now, after several congressional hearings on these issues, the Finance Committee is choosing to show us its work - and telling us where they want to go - as they wade more deeply into the legislative journey.
White papers from the Senate Finance Committee usually represent the midpoint of a legislative process. On a bipartisan basis, the Committee has held hearings, spoken to experts including MedPAC, worked alongside a Finance Committee Member driven process led by the Medicare Payment Reform Working Group, and continues to signal their seriousness in fixing this public policy challenge. All of this said, while there is a long way to go towards a final legislative product, it is reasonable to believe a bill on these issues could hitch a ride on end-of-the-year legislation. And even if the Committee is not ready for that, the bipartisan nature of this effort could likely sustain it into 2025 when a new, potentially politically different, Congress is seated.
5 Themes Of The White Paper
- Part B Payment Is Big And Offers Powerful Incentives, But The Committee Doesn’t Think The Program Is Pushing Towards Congress’ Goals: At the outset, the Committee underscores the breadth of the spending they are attempting to reform - in 2022 the Physician Fee Schedule represented about 17% of all traditional Medicare spending. They tell us they see aspects of current Part B payment that may “jeopardize a clinicians’ ability to own and operate a health care practice and meet patient needs… Incentives within Medicare payment policy can influence clinician decision-making and thus impact a much broader scope of care delivery and outlays.”?
- The Types of Clinicians Billing Medicare Are Changing: The Committee acknowledges that the types of clinicians billing Medicare are not only changing, but the number of physician encounters is growing slightly, about 3.6% from 2017 through 2022. This could be indicative of lack of coordination, which was one goal of MACRA. They also cite beneficiary encounters as shifting to Advanced Practice Registered Nurses, Physician Assistants and other, “non-physician practitioners.” One 2023 study put the overall number of all U.S. healthcare visits being performed by non-physicians at about 25%.?
- Clear, Continued Concerns About Healthcare Consolidation: Following the Change Healthcare hack, Congress has augmented interest in healthcare consolidation, a word which appears three times in the white paper. They say, “The Committee is also interested in examining incentive payment reforms that would mitigate potentially misaligned linkages between bonus amounts and total [Physician Fee Schedule] PFS revenue, given that AAPMs operate most effectively when pursuing greater value for patients, rather than higher volume. Without substantive structural enhancements along these lines, incentive bonuses could risk increasing health care provider consolidation and crowding out independent, physician-owned groups.” They also cite consolidation as one reason for physician schedule “spending shifts.”?
- A Focus On Primary Care: At a high level, the paper is favorable to primary care, mentioning it 37 times versus 12 for either specialty or speciality care. The paper includes entire sections on primary care, particularly in the chronic care context and specifically cites last month's Congressional Budget Office report examining Accountable Care Organization (ACO) successes linked to primary care. The Committee also says, “Regarding primary care physicians, the MIPS program may not accurately capture the quality of care provided,” and includes a section regarding chronic care in the primary care setting.
- Medicare Advantage Offers Some Lessons: The paper highlights the new tools given to MA plans via the Chronic Care Act of 2018. These tools include Special Supplemental Benefits for the Chronically Ill (SSBCI), which, for the first time, provided MA plans the flexibility to offer supplemental benefits to enrollees to address the Social Determinants of Health (SDOH), which the paper shares were offered by about 20% of MA plans in 2022. Of particular note, the paper says, “While the CHRONIC Care Act allows MA plans to cover certain non-medical, health related services (such as transportation to medical appointments, meals, and minor home modifications to prevent falls), Medicare FFS generally does not cover these types of services.”?
3 Additional Statements Of Note
In several areas, the white paper offers what amount to official positions from the Chairman and Ranking Member of the Finance Committee and are important to note. Stakeholders should be aware of them. They include:
- “Given the lack of improvement in patient outcomes and quality of care, the Finance Committee is considering repealing or scaling back the MIPS program to relieve physicians’ administrative burden and alleviate churn from A-APMs back to MIPS.”
- “...Challenges remain in Medicare’s current approach to physician payment, threatening the ability of physicians to sustain their practices and exacerbating the growing trends of consolidation and workforce shortages. The Committee hopes to address these challenges to ensure that Medicare Part B reimbursement structures keep pace with the cost of providing care, in addition to attracting a viable workforce to care for beneficiaries.”
- “The Committee is interested in exploring ways to improve and sustain meaningful incentives for A-APM participation.”
For physicians, non-physician clinicians, MA plans watching what is going on in traditional Medicare, ACOs, Federally Qualified Health Centers and any other organizations receiving Part B payment, this process is important. The Committee is requesting feedback, has posed questions and is moving forward.?
- Paying close attention
- Developing policy positions that state your case but are helpful to the process and cognizant of the Committee’s goals
- Thinking through key messages and developing a communications plan
- Developing a response by June 14 to the White Paper and the questions it poses
- In contact with your own Members of Congress and the Senate who represent your headquarters, clinics, patient sites, physicians/clinicians, employees or where you insure Medicare beneficiaries
This is where Platform Government Strategies brings 20 years of experience to bear. If you or your teams have questions on these issues or other areas of government health policy, consider visiting our website, Platform Government Strategies, and looking over the services we offer. You can also email [email protected].
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