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Subject: qotd: Grading a Physician's Value — The Misapplication of
Date: Mon, 2 Dec 2013 12:28:18 -0800
From: Don McCanne <email@example.com>
To: Quote-of-the-Day <firstname.lastname@example.org>
The New England Journal of Medicine
November 28, 2013
Grading a Physician's Value — The Misapplication of Performance Measurement
By Robert A. Berenson, M.D., and Deborah R. Kaye, M.D.
Perhaps the only health policy issue on which Republicans and Democrats
agree is the need to move from volume-based to value-based payment for
health care providers. Rather than paying for activity, the aspirational
goal is to pay for outcomes that take into account quality and costs. In
keeping with this notion of paying for value rather than volume, the
Affordable Care Act (ACA) created the "value-based payment modifier," or
"value modifier," a pay-for-performance approach for physicians who
actively participate in Medicare. By 2017, physicians will be rewarded
or penalized on the basis of the relative calculated value of the care
they provide to Medicare beneficiaries.
Although we agree that value-based payment is appropriate as a concept,
the practical reality is that the Centers for Medicare and Medicaid
Services (CMS), despite heroic efforts, cannot accurately measure any
physician's overall value, now or in the foreseeable future.
The value modifier is meant to provide differential payment to a
physician or physician group under the Medicare Physician Fee Schedule
on the basis of the quality of care furnished as compared with the cost.
To reduce the burden on physicians, CMS has based the value modifier on
the Physician Quality Reporting System (PQRS).
The meager rate of physician participation in the PQRS suggests that
something is fundamentally wrong — physicians simply do not respect the
measures, and for good reason. PQRS measures reflect a vanishingly small
part of professional activities in most clinical specialties. A handful
of such measures can provide a highly misleading snapshot of any
physician's quality. Research shows that performance on specific aspects
of care does not predict performance on other components of care.
Primary care physicians manage 400 different conditions in a year, and
70 conditions account for 80% of their patient load. Yet a primary care
physician currently reports on as few as three PQRS measures.
The challenge of accurately assigning costs to an individual physician
is similarly daunting. Current methods for case-mix adjustment do not
adequately capture variations in patients' illness severity,
complicating coexisting conditions, or relevant socioeconomic
differences — differences beyond the physician's control that affect the
cost of care. And we currently don't know how to attribute to an
individual physician the costs that Medicare beneficiaries generate
across the health care system.
Even if we had better measures, behavioral economists would still
challenge the pay-for-performance concept, at least for professionals
such as physicians and teachers, who must manage complex situations and
creatively solve problems. These critics argue that rewarding
professionals on the basis of a particular performance measure has the
potential to crowd out the intrinsic motivation to perform well across
the board, not just on the few activities being measured.
Comment: The "value-based payment modifier" - an adjustment in payments
to reward physicians for improving value in the health care they
provide, or to punish them for providing lower value - is yet another
example of the often misguided measures in the Affordable Care Act
allegedly designed to improve our health care system, when, in fact, the
fundamental reforms in the health care financing system that we really
needed were barely touched upon, in deference to the private insurance
It will be difficult to change from a volume-based system (fees based on
volume of services provided) to a value-based payment system when we
still do not know how to define the value of physician services, as Drs.
Berenson and Kaye explain to us in this NEJM article, though they do
suggest some other modest measures that might have some benefit.
It is fine to continue research on measures that have a potential for
improving value in health care, but it is almost criminal to ignore a
concept that has already been proven in other nations to dramatically
increase value - potentially a far greater increase than all of the
other measures combined that are included in the Affordable Care Act. Of
course, that concept is single payer financing. Let's first enact an
improved Medicare for all, and then we could tweak the system with
measures that might provide incremental improvements in value. But first