Medicare Doc Pay Needs ‘Drastic Changes’

The “healthcare crisis”, by whatever name you choose, is likely to be the impetus for some changes in reimbursement going forward. Some may happen soon, some may take more time to be fully formulated and implemented. This article is one of several recently outlining some thoughts on how to change reimbursement. Will your practice or hospital be a net winner or a net loser as these changes go forward? Financial modeling and having a good idea where your costs can be changed, not just buy modicums of decrease but by changing the business model, may allow for better and faster reaction when the changes become more apparent.

A panel convened by a major medical group is recommending that Medicare heal its physician payment shortfalls with “drastic changes” in how it reimburses doctors and other providers, rather than seeking more taxpayer money. Medicare needs $138 billion over the next decade to avoid steep cuts in physician pay. In a report released Monday, the panel-mainly composed of doctors concludes that there are enough “marginal, harmful, ineffective, or unnecessary” services already being paid for in Medicare that outside funding is unnecessary.

Better pay for doctors who care and manage those with complicated medical problems could also come from money already in the health care system, according to the National Commission on Physician Payment Reform. The commission was put together by the Society of General Internal Medicine, which is made up of about 3,000 physicians on faculties at medical schools and teaching hospitals.

The panel also said Medicare could save money by targeting payments that vary based on where they are performed. As an example, the panel noted that Medicare pays $450 for an echocardiogram in a hospital, but only $180 when the procedure is performed in a doctor’s office. “There’s no reason for that whatsoever,” said Kavita Patel, a doctor on the panel. Overall, the panel called for speedy changes in Medicare’s fee-for-service payment system so that within five years doctors are paid in a way that rewards value, not volume.