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Pay-for-Performance to Expand Under ObamaCare
July 29, 2010
In 2007, the Centers for Medicare and Medicaid established the Physician Quality Reporting Initiative (PQRI), an “incentive payment [program] for eligible professionals who satisfactorily report data on quality measures for covered professional services.” Providers who voluntarily participated could earn slightly higher reimbursement rates if they were willing to put in the time. (One survey found “the PQRI is so complicated it takes almost nine hours on average for physicians or their staff to successfully download the feedback reports.”)
Despite lackluster reviews from PQRI participants, the Democrats made this program mandatory with ObamaCare. “Under the new law, providers won’t just see reimbursement cuts for failing to report on quality measures—they’ll also face pay cuts if performance on those measures doesn’t satisfy standards to be set by the Secretary of Health and Human Services,” the Heritage Foundation says.
And with Dr. Donald Berwick at the helm of CMS, it’s likely that new standards for the PQRI will not be based on quality, but rather cost effectiveness. So, doctors may be monetarily punished for doing things that are in the best interest of their patients if government bureaucrats deem the treatment too costly.
Payment-for-performance will have additional negative side-effects (emphasis added):
The Wall Street Journal writes, “Focused on the quality of care delivered to Medicare beneficiaries, [PQRI] is elemental to the time-consuming compliance with Medicare pay for performance rules and incentive payments. Much depends upon federal rules of implementation and enforcement. In any case, this is not a prescription for medical innovation.”
“The U.S. government's plan to base Medicare payments to hospitals on certain quality-of-care measures could end up transferring funds away from hospitals in the nation's poorest, underserved areas” Reuters Health reported after examining a study looking at hospitals’ performance according to local economic conditions. The article goes on to note, “The Centers for Medicare and Medicaid Services…has acknowledged that pay-for-performance has the potential to worsen the situation of hospitals that have long faced problems in meeting performance goals.”
The same year PQRI was established, the New England Journal of Medicine published a study on performance measurement. It found, “Set–style performance measures used to guide most large-scale quality-improvement activities represent inefficient and sometimes counterproductive standards for improving clinical outcomes.”
The study concluded, “…‘what you measure improves,’ but unfortunately, we often settle for measuring that which is simple and easy to gauge and then sit back and celebrate the improvements in our ‘measures.’ As a result, we risk wasting both resources and opportunities.”
Pay-for-performance is an overly simplified solution to a complex problem and will make the practice of medicine even more discouraging for doctors. Democrats have, again, failed to understand the root causes of the growing cost of health care. Instead of addressing issues like tort reform, they have resorted to arbitrary tactics to reduce costs and to penalizing care providers instead of encouraging them to do their jobs.
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