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AMA Develops New Models of Healthcare to Ultimately Benefit Patients and the Healthcare System

The American Medical Association (AMA) recently has developed a plan to encourage competition and innovation in order to benefit patients and the healthcare system.  The AMA calls its model of patient care the Accountable Care Organizations (ACOs), and at the heart of these ACOs will be physicians, removing the need for consolidation under a hospital system.

The AMA gave the Centers for Medicare and Medicaid Services (CMS) its recommendations for adopting this system of ACOs.  According to AMA President Cecil B. Wilson, M.D., “The AMA’s recommendations make it possible for physicians in all practice sizes and settings to successfully participate in ACOs, which will foster competition and innovation…to optimize patient care and curb health care costs.”

Some of its recommendations include developing new payment models for physicians that transition Medicare away from the physician payment system currently in place, a whole host of new payment methods, loans and grants for small physician practices, alleviating of anti-trust regulations that may hinder providers from collaborating, and real-time access to important and useful data.

“Competition fosters innovation, which ultimately helps patients receive efficient high-quality care.  Care coordination is vital, and physicians can work together with a health care team to keep patients healthy and out of the hospital while maintaining independent medical practices.  CMS should adopt policies that facilitate physician-led ACOs and do not inadvertently bias participation in favor of large health systems and hospitals,” said Dr. Wilson.

To learn more about the AMA’s recommendations, you can view its outline here.

Senate Passes One-Month Reprieve for Medicare Pay Cuts

The Senate unanimously passed a bipartisan bill on November 18th that will postpone a 23% cut in Medicare physician pay that was scheduled to go into effect on December 1, 2010.  The House is expected to take up the Senate bill after Thanksgiving.  Nonetheless, even if the house follows suit and approves the bills, physicians will still face a potential 25% cut effective as of January 1, 2011.

The American Medical Association (AMA) applauded the Senate for acting quickly, but called on the House to move with the same urgency.   “This is a short-term reprieve, and the AMA is urging Congress to pass a one-year fix as soon as they return from the Thanksgiving holiday,” said AMA President Cecil B. Wilson, MD. “Delaying the 25% cut to the end of 2011 will inject some stability into the Medicare program for patients and physicians and provide lawmakers with time to develop a long-term solution to the broken physician payment system.  Now the U.S. House must act on the legislation passed by the Senate before the Dec. 1 deadline to preserve health care for America’s seniors.”

According to an AMA poll released on November 8, 2010, 94% of adults believe the Medicare pay cuts pose a serious problem to seniors, and 81% say Congress should act immediately to stop the reductions.  Among those 55 and older, 98% said the problem was serious, and 91% called for prompt congressional action.

The one-month extension in the Senate bill would be paid for using the Medicare savings from a new Centers for Medicare & Medicaid Services (CMS) policy that reduces payments for multiple therapy services provided to patients in a single day.  The bill would lower that reduction to therapists to 20% from 25% and save $1 billion, Baucus and Grassley said.  It is estimated that a patch through the end of 2011 would cost $17 billion.

CMS Issues Guidance to States for Medicaid Health IT Projects

The Centers for Medicare & Medicaid Services have provided state Medicaid directors with the federal government’s expectations while implementing the medical portion of the EMR incentive program.

According to the incentive program, the eligible physician fulfilling the criteria of “meaningful use” will be provided with the full cost of Medicaid bonuses and 90% of the state’s administrative expenses. There was, however, confusion about the latter part; as a result, CMS issued further regulations of the incentive program on August 17th, 2010.

The regulations listed three requirements for states to be entitled to the 90% administrative expenses:

  • Administering Medicaid incentive payments to eligible physicians and hospitals
  • Routine tracking of meaningful use reporting and other oversight activities
  • Pursuing initiatives that will encourage the adoption of certified EMR technology for the promotion of healthcare quality

“CMS expects that states will take an incremental approach to the initial implementation of their Medicaid EMR incentive programs, for example states may begin by focusing on provider outreach and registration, then on provider attestation and verification of eligibility, next on provider payments, and finally on capturing meaningful use data,” wrote Cindy Mann, director of the Center for Medicaid and State Operations, in the letter to state Medicaid directors.

The Centers for Medicare & Medicaid Services expect states to implement audit programs for assistance in preventing them from making improper Medicaid bonus payments. States may be given improved federal matching funds for auditing activities focused on enrollment, license verification, sanctions, data analysis, and privacy and security. The document also urges the state Medicaid directors to look for ways to save money and avoid duplication as they administer their healthcare IT programs.

CMS strongly encourages states to work together with other state-level and local partners for the designing, development, and procurement of systems needed to manage their EMR incentive programs. By doing so they would make more effective use of both CMS’ and States’ share of the cost and will condense the time line for actually dispersing incentive payments to eligible providers. CMS is available to offer technical support to states interested in exploring collaborative approaches and will disseminate information on approved and successful models.

“With the states as our partners, we can leverage the momentum provided by the American Recovery and Reinvestment Act’s EMR incentive programs to ensure that the innovations enabled by technology can support the framework of healthcare reform,” the letter concluded.