Looking forward – July 2013

David B. Hoyt, MD, FACS

For more than a decade, surgeons and other physicians have sought passage of Medicare payment reform and called upon Congress to repeal the flawed sustainable growth rate (SGR) formula used to calculate reimbursement. Unfortunately, these efforts have yielded little more than short-term fixes that have allowed the problem to grow and fester. This year, however, members of the U.S. House Ways and Means Health and Energy and Commerce Committees have demonstrated a true commitment to addressing the complex problems facing Medicare’s payment system and, at press time, were finalizing the details of a joint proposal to enact meaningful, long-term improvements.

The American College of Surgeons (ACS) applauds their efforts to develop this joint proposal and is pleased to be playing a proactive role in helping Congress to shape the new payment system. Working together, it is anticipated that Congress, physician groups, and other stakeholders will develop a pathway to reforms that will ensure that Medicare beneficiaries and ultimately all Americans have access to quality health care now and in the future.

Thought leadership

The College has a longstanding history of helping to educate members of Congress on how health care policy affects patient care. In recent years, we have been delivering a message that clearly resonates on Capitol Hill: quality improvement programs may be used to achieve the “Triple Aim” of enhancing the health care experience, improving the health of populations, and reducing costs.

In July 2012, ACS leaders testified at two different congressional meetings dedicated to developing an alternative payment methodology to the SGR. First, Frank G. Opelka, MD, FACS, Associate Medical Director of the ACS Division of Advocacy and Health Policy, represented the College at a Senate Finance Committee roundtable, during which representatives from a range of physician organizations offered their suggestions for addressing the payment problem. About a week later, I spoke at a House Energy and Commerce Health Subcommittee hearing, describing the College’s experience with quality programs and the framework for the ACS’ Value-Based Update (VBU) to replace the SGR.

At press time, the College has responded to three requests for input on the House committees’ joint proposal. On February 25, the College wrote to Dave Camp (R-MI), Chair of the Ways and Means Committee, and Fred Upton (R-MI), Chair of the Energy and Commerce Committee, to offer feedback on the first draft of the plan. Also at their invitation, the ACS commented on the committees’ second draft in an April 25 letter, and on May 7, the ACS testified at a House Ways and Means Health Subcommittee hearing on developing a viable Medicare physician payment policy.

In each of these instances, the College asserted that any new payment system must be based on the complementary objectives of improving outcomes, quality, safety, and efficiency while simultaneously reducing the growth in health care spending. The ACS maintains that our VBU provides a feasible model for achieving these ends and could be readily adapted to the three-phase implementation timeline suggested in the committees’ joint proposal.

VBU and committee plan

It is still too early to delve into specifics of the joint proposal or the VBU, but the College’s views on some key elements are as follows:

  • The College has endorsed the proposal’s call for immediate repeal of the SGR and elimination of the 24.4 percent across-the-board cut slated for 2014, as well as any future SGR cuts.
  • The College supports an initial five-year period of payment stability during which longer-term reforms could be developed, tested, and incrementally implemented. If Medicare payment is to move toward a value-based system, it is imperative that the payment models and quality measures that will support this paradigm be properly aligned, which may take some time.
  • The ACS supports tying a base rate of payment with a variable rate that would be adjusted for performance as measured through overall physician participation in quality improvement programs, including the Physician Quality Reporting System, the Electronic Health Record and e-Prescribing Incentive Programs, the ACS National Surgical Quality Improvement Program, and so on.
  • A core feature of the College’s VBU is the establishment of Clinical Affinity Groups (CAGs). In concept, CAGs would be groups of physicians who treat specific medical conditions, diseases, or patient populations. Examples include cancer care, surgery, cardiac care, digestive diseases, rural health care, and so on. The purpose of the CAGs would be to encourage the delivery of team-based, coordinated care, which the College has found yields more favorable patient outcomes.
  • The ACS maintains that physicians should be able to participate in a number of alternate payment models, including CAGs, accountable care organizations, and bundling projects.
  • To encourage physicians to be good stewards of the health care commons, the College supports the provision of payment incentives for efficient use of health care resources.

Much work ahead

The joint congressional committee proposal and the ACS’ VBU plan are the results of many years of examining the challenges confronting the physician payment system. The College’s leadership is extremely proud and pleased to have the opportunity to share with Congress the lessons we have learned through 100 years of promoting high-quality patient care and to play a leading role in developing a value-based health care system.

It is important to remember, however, that passage of payment reform legislation will be just the beginning of a transformative process. The College looks forward to continuing to apply its experience, knowledge, and programs in the creation of a truly sustainable system that will appropriately reimburse surgeons and other physicians who provide quality care to the American people.

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