Reimbursement rates after Obamacare

[nm825]

So I'm trying to do a little more research on ACA for some upcoming interviews. Does the reimbursement model change from the fee-for-service model to the outcomes-based model only affect Medicare?

Also, would a value argument against ACA be that because we switched over to an outcomes-based model, doctors are discouraged from taking on high-risk patients (patients with chronic illnesses, obese patients, etc.) because they are more likely to be rehospitalized for an issue, thereby harming the physician's compensation? Wouldn't this mean that ACA might actually lower primary care access for some patients?

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[mik30102]

Fee for service has been dead for years due to the HMO revolution of the 90's. The ACA has had little to nothing to due with that. Capitation may very well lead a physician to drop non compliant patients that are costing more then his fee. The hope would be that the average capitation payment would let physicians take on a few financial loses but if capitation payments were set to low it could definitively lead to physicians refusing to see people.

 

[TheRhymenocerous]

As best I understand it:

Fee-for-service is definitely still the core of the payment system (and is an absolute train wreck...look up SGR reform if you want to learn more about that) – it's only a small minority of providers that are part of Accountable Care Organizations, and even those still often use a form of FFS payment. The government is trying to implement new payment mechanisms to tie payments to quality, but that really just builds on/modifies FFS, rather than replacing it outright. And yes, they can only directly affect Medicare reimbursement, but the whole system is built around what the government pays. It's actually pretty ridiculous – CMS sets Medicare reimbursement rates and then private insurers set their own rates based on that, only significantly higher. But that's another story. The point is that the whole payment system is such a tangled mess that changes to Medicare will unavoidably affect the way private insurers do business too.

And as to your second point, the ACA is actually significantly improving the odds that high-risk patients are going to get good care, since they're way more likely to be insured now. One of the biggest changes the ACA brought about was prohibiting insurers from denying coverage people with preexisting conditions. Having patients is always more profitable for a hospital than not having patients, and the quality-based payments are based on hospital-wide statistics, not payments tied to individual patients. Plus, it's for the most part a system of potential bonuses for doing well, rather than penalties for low performance.

 

[Frazier]

It is up in the air -- depends. Regardless, one thing is certain: doctors won't be able to afford as many ponies as before.

 

[TheRhymenocerous]

Also, word of advice, call it the Affordable Care Act on the interview circuit rather than Obamacare.

 

[PL198]

As best I understand it:

Fee-for-service is definitely still the core of the payment system (and is an absolute train wreck...look up SGR reform if you want to learn more about that) – it's only a small minority of providers that are part of Accountable Care Organizations, and even those still often use a form of FFS payment. The government is trying to implement new payment mechanisms to tie payments to quality, but that really just builds on/modifies FFS, rather than replacing it outright. And yes, they can only directly affect Medicare reimbursement, but the whole system is built around what the government pays. It's actually pretty ridiculous – CMS sets Medicare reimbursement rates and then private insurers set their own rates based on that, only significantly higher. But that's another story. The point is that the whole payment system is such a tangled mess that changes to Medicare will unavoidably affect the way private insurers do business too.

And as to your second point, the ACA is actually significantly improving the odds that high-risk patients are going to get good care, since they're way more likely to be insured now. One of the biggest changes the ACA brought about was prohibiting insurers from denying coverage people with preexisting conditions. Having patients is always more profitable for a hospital than not having patients, and the quality-based payments are based on hospital-wide statistics, not payments tied to individual patients. Plus, it's for the most part a system of potential bonuses for doing well, rather than penalties for low performance.

It's the exact same thing relatively. Having patients might be more profitable for hospitals, but it isn't for insurers if they are forced to insure these patients for a much lower cost than they typically would assess the person. There's a reason those people are denied coverage, because what it would cost them to be insured by the insurance company(due to their high risk) wouldn't be affordable. It's basically telling a business that they can't utilize economics, which is always fun. "Hey you charge too much for that bike, charge less." "Well I'll go out of business because that bike costs me more than you're saying I can charge for it." "Tough luck" <- and there is your parallel to the health insurance marketplace of 2016. Improving odds that high-risk patients are going to get good care isn't inherently automatically a good thing. At what cost? They can't get good care because most likely they've maintained their health poorly to get into that point. I'm not really sure how sidestepping that fact and having them pay no penalty for poor health maintenance fixes it. If anything, it just encourages it and thus you will have even more people with poor health maintenance, becoming high risk and costing the system more and more money. Quality is completely arbitrary and it definitely will result in docs firing patients.

" Hey doc I have an infection, I need some antibiotics."
" Well your infection is viral so penicillin won't help"
" wow you're a jerk, you're a bad doctor, 4/10 rating."

^ and that is how patient satisfaction and all these wonderful new metrics will work. Guess what that patient rates you if you give them their penicillin? A 10. So you get to decide between herd immunity or making money. patient satisfaction isn't a good way to measure a physician's performance. a lot of times you can't give the patient what they want, because a) they don't need it b) it could hurt the rest of the world c) there's contraindications they don't understand or know about and won't understand no matter how much you explain.

 

[DubVille]

It's the exact same thing relatively. Having patients might be more profitable for hospitals, but it isn't for insurers if they are forced to insure these patients for a much lower cost than they typically would assess the person. There's a reason those people are denied coverage, because what it would cost them to be insured by the insurance company(due to their high risk) wouldn't be affordable. It's basically telling a business that they can't utilize economics, which is always fun. "Hey you charge too much for that bike, charge less." "Well I'll go out of business because that bike costs me more than you're saying I can charge for it." "Tough luck" <- and there is your parallel to the health insurance marketplace of 2016. Improving odds that high-risk patients are going to get good care isn't inherently automatically a good thing. At what cost? They can't get good care because most likely they've maintained their health poorly to get into that point. I'm not really sure how sidestepping that fact and having them pay no penalty for poor health maintenance fixes it. If anything, it just encourages it and thus you will have even more people with poor health maintenance, becoming high risk and costing the system more and more money. Quality is completely arbitrary and it definitely will result in docs firing patients.

" Hey doc I have an infection, I need some antibiotics."
" Well your infection is viral so penicillin won't help"
" wow you're a jerk, you're a bad doctor, 4/10 rating."

^ and that is how patient satisfaction and all these wonderful new metrics will work. Guess what that patient rates you if you give them their penicillin? A 10. So you get to decide between herd immunity or making money. patient satisfaction isn't a good way to measure a physician's performance. a lot of times you can't give the patient what they want, because a) they don't need it b) it could hurt the rest of the world c) there's contraindications they don't understand or know about and won't understand no matter how much you explain.

Pain is now the 5th vital sign. I'm going to be prescribing Dilaudid PCAs on an outpatient basis to keep my satisfaction numbers up. Then instead of a mint, I will have fentanyl lollipops in a basket by the door with my business info on the wrapper to get my rep out there. Who says I need an MBA?

 

[PL198]

Pain is now the 5th vital sign. I'm going to be prescribing Dilaudid PCAs on an outpatient basis to keep my satisfaction numbers up.

I CANNOT WAIT to see these metrics for pain management docs. My god it's literally going to come down to who is giving out pills and who isn't. Isn't it like ~ 1/4 -1/2 of pain management patients are addicts? They're totally a good metric for deciding what doc gets paid.

 

[TheRhymenocerous]

It's the exact same thing relatively. Having patients might be more profitable for hospitals, but it isn't for insurers if they are forced to insure these patients for a much lower cost than they typically would assess the person. There's a reason those people are denied coverage, because what it would cost them to be insured by the insurance company(due to their high risk) wouldn't be affordable. It's basically telling a business that they can't utilize economics, which is always fun. "Hey you charge too much for that bike, charge less." "Well I'll go out of business because that bike costs me more than you're saying I can charge for it." "Tough luck" <- and there is your parallel to the health insurance marketplace of 2016. Improving odds that high-risk patients are going to get good care isn't inherently automatically a good thing. At what cost? They can't get good care because most likely they've maintained their health poorly to get into that point. I'm not really sure how sidestepping that fact and having them pay no penalty for poor health maintenance fixes it. If anything, it just encourages it and thus you will have even more people with poor health maintenance, becoming high risk and costing the system more and more money. Quality is completely arbitrary and it definitely will result in docs firing patients.

" Hey doc I have an infection, I need some antibiotics."
" Well your infection is viral so penicillin won't help"
" wow you're a jerk, you're a bad doctor, 4/10 rating."

^ and that is how patient satisfaction and all these wonderful new metrics will work. Guess what that patient rates you if you give them their penicillin? A 10. So you get to decide between herd immunity or making money. patient satisfaction isn't a good way to measure a physician's performance. a lot of times you can't give the patient what they want, because a) they don't need it b) it could hurt the rest of the world c) there's contraindications they don't understand or know about and won't understand no matter how much you explain.

Well I'm not super concerned about insurers going out of business. And by that I mean not concerned at all – this has been a windfall for private insurance. I agree there ought to be better incentives for people to take better care of themselves (and some insurers are implementing programs like that privately) and I agree that measuring quality is a pretty difficult task (though readmission rates and nosocomial infection rates don't lie). When you actually look at some of the legislation, the language surrounding quality metrics is super vague. Anyway, I think the ACA is very far from perfect, but I think that securing access to care for people with pre-existing conditions is one aspect that's been a definite success.

 

[PL198]

Well I'm not super concerned about insurers going out of business. And by that I mean not concerned at all – this has been a windfall for private insurance. I agree there ought to be better incentives for people to take better care of themselves (and some insurers are implementing programs like that privately) and I agree that measuring quality is a pretty difficult task (though readmission rates and nosocomial infection rates don't lie). When you actually look at some of the legislation, the language surrounding quality metrics is super vague. Anyway, I think the ACA is very far from perfect, but I think that securing access to care for people with pre-existing conditions is one aspect that's been a definite success.

Why aren't you concerned? They have a business to run, just like everyone else. I don't see how extreme regulation is a windfall for private insurance, but maybe we have different definitions or something. Mine is something unexpected happening that helps you out, such as you're 6th great uncle dying and leaving you 500K, that type of deal.

 

[TheRhymenocerous]

Why aren't you concerned? They have a business to run, just like everyone else. I don't see how extreme regulation is a windfall for private insurance, but maybe we have different definitions or something. Mine is something unexpected happening that helps you out, such as you're 6th great uncle dying and leaving you 500K, that type of deal.

Considering there's now a legal requirement to purchase private insurance, I think they'll make out okay.

 

[jw3600]

Fee for service has been dead for years due to the HMO revolution of the 90's. The ACA has had little to nothing to due with that. Capitation may very well lead a physician to drop non compliant patients that are costing more then his fee. The hope would be that the average capitation payment would let physicians take on a few financial loses but if capitation payments were set to low it could definitively lead to physicians refusing to see people.

Yeahhhh. Not really.

 

[DubVille]

I CANNOT WAIT to see these metrics for pain management docs. My god it's literally going to come down to who is giving out pills and who isn't. Isn't it like ~ 1/4 -1/2 of pain management patients are addicts? They're totally a good metric for deciding what doc gets paid.

Depends on whose numbers you believe, i know my various clinics vary broadly based on location, etc. I hope the government is smart enough to realize that we have a world of prescription drug addicts and will change questionnaires appropriately. Otherwise my career path will swing to inpatient Neuro rehab. I didn't get into this to be a candy man.

 

[Make Or Break]

Depends on whose numbers you believe, i know my various clinics vary broadly based on location, etc. I hope the government is smart enough to realize that we have a world of prescription drug addicts and will change questionnaires appropriately. Otherwise my career path will swing to inpatient Neuro rehab. I didn't get into this to be a candy man.

So when does all of this start? Such as the patient ratings of their doctors?

 

[PL198]

Considering there's now a legal requirement to purchase private insurance, I think they'll make out okay.

right but that doesn't mean it's beneficial to the insurance companies. if we passed a law that said everyone has to buy a car, and then subsequently the government said " but car companies can't charge more than 3000 dollars for cars," you're going to see more people with cars, but it still hurts the companies. you can't force someone to provide a service to everyone and then put a cap on what they can charge for that service.

it's literally saying that they can't charge more for things that make the service more expensive for the insurance companies. so an insurance company is not allowed to charge me less than a similarly aged male, who has 0 health maintenance and isn't compliant. That hardly seems logical. it's just bad business and as a result, a lot of insurance companies are just going to walk away. if there's no money to be made in an industry, it will cease to exist.

there are many more factors at play then the sheer number of people that purchase insurance. either you make insurance more expensive for everyone ( that's fun, I get to pay for other people's bad habits) or the companies lose money and decide to leave the market.

 

[DubVille]

So when does all of this start? Such as the patient ratings of their doctors?

In some ways it has already. Hospitals will start in 2015, which is based on physician, nursing, infections, satisfaction, etc. For private practice I believe 2018 buy am not sure it is set in tone. Pain control for what its worth is a measure of quality. So keep the narcan handy

 

[PL198]

In some ways it has already. Hospitals will start in 2015, which is based on physician, nursing, infections, satisfaction, etc. For private practice I believe 2018 buy am not sure it is set in tone. Pain control for what its worth is a measure of quality. So keep the narcan handy

it's interesting because the same people propping the ACA up are the ones saying that medicine isn't just a service and that you have a duty, yet they reinforce the service concept by making patient satisfaction critical in determining compensation.

 

[DubVille]

it's interesting because the same people propping the ACA up are the ones saying that medicine isn't just a service and that you have a duty, yet they reinforce the service concept by making patient satisfaction critical in determining compensation.

Yes, it's an odd precedent. I still think the readmission policy is among the craziest aspects of the law.