New Testimony: Getting What We Want from Medicare Physician Payment

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<p>For years, Congress has temporarily postponed cuts in Medicare payments to physicians that are triggered by the existing payment formula. Today, in <a href="/publications/publication/2011/may/medicare-physician-payment-we-get-what-we-pay-how-can-we-get-what">invited testimony</a> before the health subcommittee of the U.S. House of Representatives' Ways and Means Committee, Stuart Guterman, vice president for payment and system reform at The Commonwealth Fund, and executive director of the Commission on a High Performance Health System, called for new payment models that will pay physicians appropriately while also improving care for beneficiaries and adding value for the Medicare program. </p>
<p>Payment reform will require changes in the way health care is organized and delivered. "The fee-for-service payment mechanism that typifies the U.S. health system emphasizes the provision of health services by individual providers rather than health care that is coordinated across providers to address the patient’s needs," Guterman said. By contrast, integrated health care delivery systems that emphasize coordination and accountability are supported by alternative payment approaches such as primary care medical home fees, global fees—a payment rate that covers all the health care provided to an individual during a specified time interval—and rewards for performance.</p>
<p>These types of payment models—which will be tested by the new Center for Medicare and Medicaid Innovation—align financial incentives with the health system's goals of higher-quality and more efficient care. "In our very large and mostly privately owned and operated health care delivery system," Guterman said, "changing payment incentives is one of the few tools available for inducing higher performance."</p>
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