October 30 - November 20, 2024

Welcome to The Partnership to Empower Physician-Led Care biweekly newsletter, which includes news from our members, legislative and Administration updates, news clips, and studies about value-based care, primary care, and independent physicians. 

Administration News  

CMS: (10/29) – CMS released the CY 2025 Physician Fee Schedule Final Rule. The rule finalizes payment rates and policy changes effective January 1, 2025. Overall, the proposed CY 2025 PFS conversion factor is $32.35, a decrease of $0.94 (or 2.83%) from the current CY 2024 conversion factor of $33.29). PEPC’s comments on the proposed rule can be found here. We continue to call on Congress to address the impending payment cuts by the end of the year.

• Healthcare Innovation: (11/4) CMS Physician Fee Schedule Provokes Protests Among Providers – Every major national provider association came out with a largely negative assessment on Friday, Nov. 1. The leaders at MGMA released the following statement: “CMS and Congress have once again overlooked the sobering financial realities facing our nation's medical practices, finalizing a 2.83 percent reduction to the 2025 Medicare conversion factor, further increasing the gap between practice expenses and reimbursement rates. Congress must immediately return from recess to pass H.R. 10073, averting the 2025 cut to the conversion factor and stabilizing physician practices until a more permanent, sustainable solution to the Medicare physician payment system can be realized.”

CMS: (11/8) – CMS released results from performance year (PY) 2023 of the ACO REACH model. In PY 2023, REACH ACOs generated approximately $1.6 billion in gross savings, representing approximately a 5.8 percent gross savings rate relative to the retrospective adjusted PY benchmarks. The average total quality score in PY 2023 was 78.55 percent across the 118 Standard and New Entrant ACOs, and 86.73 percent across the 14 High Needs Population ACOs. The PY 2023 evaluation report is expected to be released in the summer of 2025.

CMS: (11/12) – CMS released a report highlighting themes, concepts and next steps from the Innovation Center’s “Hackathon” series. To increase patients in accountable care relationships in rural areas, participants recommended sharing infrastructure across care delivery organizations to create economies of scale for smaller, rural provides.

Legislative News  

Sens. Hassan (D-NH) and Cassidy (R-LA) Site Neutral Framework: (11/1) – Sens. Hassan (D-NH) and Cassidy (R-LA) released a framework for site neutral payment policy. The framework proposes two policy options for implementing site neutral policies and two hospital reinvestment options, both of which are intended to incentivize hospitals to enter two-sided risk arrangements.

• PEPC Statement: PEPC has long advocated for payment parity between physician offices and hospital outpatient departments as one way to level the playing field for independent physicians. Site specific payment policies drive consolidation, higher costs for Medicare and further stacks the deck against independent physicians and practices. That is why we have long advocated for site neutral payment policies in Medicare. We also recognize, however, that the physician payment landscape is complex. Medicare Part B payment rates are inadequate and also unsustainable for physicians, especially those in small and independent practices. When adjusted for inflation, Medicare reimbursement for physician services has declined 29% since 2001. Without broader reform to the Physician Fee Schedule, including a full Medicare Economic Index (MEI) update, Congress must commit to putting 100% of the savings from any site neutral policy back into Part B payment. Without that commitment, site neutral policies simply take resources out of the health care system and cannot be supported.

News Clips  

Healthcare Innovation (10/31) MedPAC Focus Groups Provide Snapshot of Clinician Attitudes – In focus groups conducted earlier this year by the Medicare Payment Advisory Commission (MedPAC), some of the clinicians participating in accountable care organizations said they saw few benefits for their patients and minimal financial rewards. During its Oct. 10 public meeting, MedPAC provided some highlights of focus groups with Medicare beneficiaries and a limited number of clinicians that regularly see Medicare patients in an outpatient setting, including separate groups of primary care physicians, specialists, and nurse practitioners and physician assistants. Regarding quality reporting, many of the clinicians felt that quality measures did little to improve patient care and led to unnecessary work. Some noted that quality measures and the reimbursement they receive often do not reflect their patients' complexity.

Modern Healthcare (10/31) FTC looks to revive noncompete ban through appeals – The Federal Trade Commission has appealed a federal court ruling blocking its ban on most noncompete agreements. The FTC filed a notice to appeal on Oct. 18, taking the case to the U.S. Court of Appeals for the 5th Circuit. Attorneys ultimately expect the Supreme Court to review the issue as several other similar lawsuits over the ban wind their way through the courts.

Healthcare Innovation (10/31) Editor’s Notes: Good ACO News, Coming at a Key Moment – The news coming out of the federal government on Oct. 29 was excellent; on Tuesday, senior officials at CMS were able to announce record net savings for the Medicare Shared Savings Program (MSSP) on Oct. 29—a total of more than $2.1 billion in 2023, along with $3.1 billion in performance payments for accountable care organizations (ACOs) participating in the program. Farzad Mostashari, M.D., CEO of Aledade, said: “As CMS reports, ‘ACOs led by primary care clinicians had significantly higher net per capita savings than ACOs with a smaller proportion of primary care clinicians. Another myth: to succeed in value-based care, you wouldn't listen to what patients want. Aledade Tri-State (nine-percent savings rate) was the highest -rated ACO in the country by patients for shared decision making. The second highest savings ACO in Aledade,” he wrote, “was our PA MSSP ACO (15.4-percent savings).”

JAMA (11/1) The Curious Persistence of Site-Dependent Payments – If supply-side strategies continue to fail at ending wasteful site-dependent payments, then private and public efforts may be more fruitful when they focus on the buy side. Given that employers are the nation’s biggest commercial purchasers of health care, and considering their record of poor purchasing decisions, improving the value of the $1.5 trillion spent annually would have widespread benefits for both the nation’s health sector and the economy. Using buy-side strategies to end site-dependent payments may be a harbinger for better health care purchasing and higher value health services industry-wide.

Health Affairs (11/1) Chang(ing) Health Care: Bigger May Not Be Better, Just Necessary – Further regulation of health system consolidation should take into account all aspects of the market for health care goods and services within the range of geographic areas that are relevant to patients, including the rapid consolidation of the insurer market, as well as the consolidation of other parts of the health care ecosystem. As the provider sector changes to adapt to a rapidly consolidating insurer market, continued alignment may be critical to survival in a health care ecosystem that depends upon the private market to compensate for chronic public underpayments by public health insurance. For patients, how that provider consolidation occurs may not be a question of “if” but “who” their doctors and hospitals are aligned with—for-profit corporations, private investors, physician-owned mega practices, or not-for-profit systems. Any further regulation of the health market must also consider not just control of providers, but especially market power of payers in relevant service areas that may be hyper local but may also be statewide or regional.

Events

November

• November 20, 2024 – Primary Care Collaborative, “Primary Care - The MVP of MSSP.”
• November 20, 2024 – CMS Innovation Center, “Person Centered Listening Session: Improving Care Experience, Outcomes, & Equity in Rural Communities.”

If you would like your event to be included in the next newsletter, please email sarah@physiciansforvalue.org