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Obama administration to change how doctors are paid

Medicare will evaluate and compensate doctors based not only on what services are provided but also on the presumed quality of the care delivered.

This article originally appeared on heartland.org.

Building on years of rhetoric and experiments aimed at changing how doctors are paid, Health and Human Services Secretary Sylvia Burwell announced in late January Medicare would start to evaluate and compensate doctors based not only on what services are provided but also on the presumed quality of the care delivered.

Medicare currently has programs that attempt to compensate doctors based on patient health outcomes and other factors, including Accountable Care Organizations and lump sum or ??bundled? payments for an entire episode of care.

The results of these new payment systems have been mixed, according to a 2014 Rand Corporation study, which found ??evidence regarding improvements in performance from [pay for performance] experiments of the past decade is mixed (i.e., positive and null effects); where observed, improvements were typically modest.? Regarding bundled payments, Rand concluded ??there is virtually no evidence on whether they can be successfully implemented and what their effects are.?

Linda Gorman, director of the Health Care Policy Center at the Independence Institute, expressed skepticism about the proposed payment changes.

??The payment structure proposed is just another set of administered prices that block proper communication between patients and those who provide them with medical care,? Gorman said. ??Given that reliable measures for the quality of patient care have yet to be found, the people proposing these new administered prices will have only the foggiest idea whether or not they are harming patients.?

Sean Parnell (sparnell@heartland.org) is managing editor of Health Care News.

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