Medical Device Daily Washington Editor

WASHINGTON — With the State of the Union address looming, and hints that President Bush will offer plans for expanding healthcare coverage, a number of organizations have teamed up to offer their own proposals to expand the pool of coverage in the U.S.

Add to that list the American College of Physicians (ACP; Philadelphia), which rolled out its proposal yesterday at the National Press Club here in the nation’s capital.

Perhaps predictably, the plan offered by ACP calls for greater reliance on primary care physicians and termination of the sustainable growth rate (SGR) mechanism that Congress authorized and has routinely overridden.

Lynn Kirk, MD, president of ACP, said that the association was offering “sweeping new policy recommendations to reform Medicare, Medicaid, and SCHIP,” the state children’s health insurance program, adding that the lynchpin in the plan — patient-centered care that relies on primary care physicians to provide a medical “home” — has “proved to result in better quality, more efficient use of resources, higher quality and better patient satisfaction.”

Kirk made the case that the current state of healthcare indicated clearly that “comprehensive reforms are needed in how medical care is organized, valued, financed and reimbursed.”

“The solution” to the nation’s healthcare woes, she said, “is to redirect federal health policy toward an orientation that builds upon a relationships between the patient and their primary care physician.”

This model, Kirk said, is buttressed by a recent Dartmouth University (Hanover, New Hampshire) study that indicated that greater reliance on primary care lowers overall utilization and reduces complications and hospitalizations.

“A healthcare system that leaves out nearly 47 million Americans is not a patient-centered system,” Kirk observed.

Bob Doherty, the association’s senior VP of governmental affairs and public policy, gave an outline of the association’s plan, leading off by noting that “we are calling on Medicare to make fundamental changes in the way that they pay physicians for delivering care.”

The plan calls for doctors interested in participating in patient-centered care to implement healthcare information technology (HIT) in order to provide clinical decision systems and track patients more closely. Under the new payment structure, doctors would earn pay on “a bundled prospective basis” that pays for care outside of face-to-face encounters and would adjust payments for risk incurred by co-morbidities.

Doctors would have to maintain compliance with quality reporting.

The plan also calls for replacing SGR “with a fairer and more accurate system that will result in stable payments . . . and create stronger incentives for physician engagement” in programs that boost quality and reduce overall costs.

The five-year transition would pay doctors a baseline along with pay-for-reporting bonuses. After the transition, CMS would pay an annual positive update and bonuses from a “dedicated source of funding” for quality improvement. Additional bonuses would be made available to spur further improvements in performance and to spur more interest in primary care.

Doherty said that the quality incentives provided by the Tax Relief and Health Care Act of 2007 constitute “a one-size-fits-all approach.”

A member of the audience remarked that the ACP proposal resembles capitation, to which Kirk responded that while “there are some similarities in that you’d be paying a prospective amount per month,” capitation transferred financial risks to doctors and ended up suppressing appropriate care.

He said that “the right kind of risk adjustment” will avoid the pitfalls of capitation, and he added that the ACP plan retains a fee-for-service component “to avoid disincentive to see patients in the office” in addition to the performance incentive.

“We’ve built in sufficient safeguards so that you don’t see the problems with capitation,” Kirk insisted.

When asked if the association would back a boost in the age of eligibility for Medicare, if all else failed to keep Medicare affordable for the nation’s workers, Doherty said that ACP “does not have a recommendation on that.” But he said that “clearly, if [efforts to restrain spending] are not successful, Congress will have that option.”

The role of the medical specialist is a part of this plan, and Kirk said that specialists “have the option of being the patient-centered medical home.”

On the other hand, some specialists might find such a task a sharp conflict with their operational orientation, and she admitted that this will not always fly.

“I think it depends on the physician,” Kirk said, noting that such a “collaboration would be a positive thing for many specialists” all the same.

One of the potential flies in this ointment is the current and possibly future lack of primary care physicians, Kirk acknowledged, noting this as a “crisis in primary care.”

The organization’s proposal, she said, will be “more attractive to primary care . . . but it will take time for that to happen.” Doherty added that pay-per-procedure medicine is part of the problem and that “providing [improved] reimbursement for primary care doctors” will help fix this imbalance.

Neither Kirk nor Doherty offered an estimate as to how much the proposal would cost to roll out.

HIT is bound to be vital in any such effort, as is commonly known, but some hospitals and doctors are perceived as nervous about violating Stark and anti-trust laws despite the exemptions carved out last year by the Office of Inspector General and the Department of Health and Human Services.

Doherty told Medical Device Daily that “[w]e supported the safe harbor provisions in the House bill,” a reference to H.R. 4157, but he also said that Rep. Pete Stark (D-California), the author of the legislation that bears his name, does not seem particularly friendly toward legislative establishment of safe harbors.