Dr. Lee Gross is worried. He has practiced family medicine in North Port, Fla., near Sarasota, for 14 years. But he and two partners are the last small, independent medical group in the town of 62,000. Everyone else has moved away, joined larger organizations or become salaried employees of hospitals or health companies.
The Medicare Access and CHIP Reauthorization Act was Congress’s boldest step since the 2010 Affordable Care Act to push the health-care system to reward quality over quantity. The law, which passed with bipartisan support, seeks to use monetary incentives and performance measures to promote better care. It replaced a widely derided reimbursement formula that Congress regularly ignored because it would have cut payments to doctors.
“This is a big change, we know,” said Tim Gronniger, deputy chief of staff at the Centers for Medicare and Medicaid Services. But “the current way we pay doctors incentivizes them in bad ways — to waste resources, for example.”
The new law has two payment tracks. On one, doctors whose performance and quality of care exceeds benchmarks will get bonuses of up to 4 percent of their total Medicare reimbursements. Those will start in 2019, based on evaluations of care delivered in 2017, and will rise to a maximum of 9 percent by 2022.
At the same time, physicians who score poorly on the benchmarks will face penalties at the same levels.
The other track involves alternative payment models, which hold large practices or organizations accountable for the quality of care delivered by all of their physicians. Between 2019 and 2024, the law will provide a 5 percent annual bonus to these doctors.
The law requires providers to choose one of the payment paths; the only exceptions are those who see too few Medicare patients or whose income from Medicare is too low. The amount the government will spend on the bonuses — estimated at $833 million for 2019, not including a special $500 million bonus pool for five years for “exceptional” doctors — must be balanced by the penalties to keep the program budget neutral.
Experts agree that Congress primarily intended for doctors to join those larger organizations or systems, which generally are considered better equipped to manage and coordinate care, improve quality and lower costs. The concern is that the new payment system — laid out in 962 pages of proposed regulations — will put doctors in solo or small practices at high risk of incurring penalties.
“The ways it’s structured now, the large practices will do well and the small practices will do badly,” said Paul Ginsburg, director of the Center for Health Policy at the Brookings Institution.
During a public comment period, the American Medical Association and dozens of other physician trade organizations and every state medical association said the system needs to be simplified and must “accommodate the needs of physicians in rural, solo or small practices in order to enhance their opportunities for success and avoid unintended consequences.”
According to the AMA, one of those consequences could be penalized doctors limiting the number of Medicare patients they see or dropping Medicare.
“I have no idea what I’m going to do yet,” acknowledged primary-care physician Jean Antonucci, who has a solo practice in Farmington, Maine. Half of her patients are covered by Medicare. “If I’m going to lose money, I’ll have to see what my options are.”
Like Gross in Florida, Antonucci wants to preserve her small practice. “I don’t want to spend the bulk of my time doing paperwork or collecting data on my patients,” she said. “That’s what the doctors in my community who are employed [in larger groups] seem to spend most of their time doing.”
“We don’t yet have a good system to measure the performance of individual physicians,” said Robert Berenson, a physician and fellow at the Urban Institute and former director of Medicare payment policy for the federal government. “And yet we are going to peg billions of dollars in payment to such measurement. It’s a little crazy.”
A recent study published in the journal Health Affairs calculated the current scope of that data collection and reporting, as required by Medicare, private insurers and others. The total: $40,000 per doctor per year, or $15.4 billion nationally.
Gronniger said CMS has already scaled back the number of physician measures as part of the new law. Even so, the AMA and other physician groups are pushing to delay the start date from next January until at least July.
“This is all very complex,” said Andrew Gurman, president of the AMA. “But we are committed to trying to make the new law work.”
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.