Payment reform provisions include bundling of services and value-based
William L. Rich III
Physicians must pool their resources to meet regulatory benchmarks and
satisfy the needs of an expanding patient population as federal health care
reform takes effect, a physician-advocate said.
At the American Society of Retina Specialists meeting in Boston,
William L. Rich III, MD, medical director of health policy for the American
Academy of Ophthalmology, told colleagues that they must work in teams to
accommodate an influx of previously uninsured patients who will receive
coverage under the Patient Protection and Affordable Care Act.
Over the next decade, the pressure of constrained resources during
a period of expanding health care access 43 million uninsured
increasing demands for improved quality and patient-centeredness in a more
diverse patient population with known disparities of care
will lead to a
growing interdependence of society and medicine, Dr. Rich said.
Health care faces challenges such as burgeoning costs, 43 million
insured citizens, perceived poor quality and safety, a lack of comparative
effectiveness research, and disparities in care, Dr. Rich said.
A decade-long rise in health care spending has significantly diminished
disposable personal income. Out-of-pocket costs for a family of four averaged
$16,000 in 2009 and $18,000 in 2010, and they are expected to reach $36,000 by
2019, Dr. Rich said.
Health care has been a major drain on our economy for well over a
decade, Dr. Rich said. Its the leading cause why disposable
income in the American middle class has gone down.
The ability to provide health care coverage for previously uninsured
patients hinges on payment reform, Dr. Rich said.
[The Affordable Care Act] will move us away from fee-for-service,
where you were rewarded for doing more volume of service, Dr. Rich said.
Future payments will be based on the value, in terms of quality and cost,
of services provided to patients.
Starting in 2013, the Centers for Medicare and Medicaid Services will
bundle medical services. In ophthalmology, CMS will bundle glaucoma,
age-related macular degeneration and diabetic retinopathy services
including drugs, devices, testing, surgeon fees and facility fees and
will pay in installments. Physicians will be encouraged to use more generic
drugs and order fewer tests in order to gain a greater share of cost savings,
which will be divided between payers and providers.
However, risk adjustment will be a major sticking point of the bundling
component, Dr. Rich said.
ACOs, value-based purchasing
Payment reform partly hinges on accountable care organizations (ACOs),
collaborative entities comprising primary care physicians, hospitals and other
professionals, Dr. Rich said.
Ophthalmology will be largely unaffected by ACOs; ophthalmologists will
still be paid under the fee-for-service model, he said.
So, theres no need for you to sign up with an exclusive
contract with a hospital or physician group tied to an ACO, he said.
Were not attractive to hospitals. We generate no income for
Youre going to be able to practice the way you are
However, ophthalmologists will need to maintain close communication with
primary care providers to retain their access to referrals, Dr. Rich said.
Under a value-based purchasing component starting in 2012, CMS will
start sending reports to providers on their use of various resources. Beginning
in 2013, providers will be required to report resource use and disclose all
financial relationships with industry.
Physicians respond to both quality efforts, doing the right thing,
and they respond to economic stimulus. If you combine those two together, you
dramatically decrease variation in care, Dr. Rich said.
Quality and access
Health care reform also targets care quality, Dr. Rich said. For
example, despite explosive growth in health care spending, Americans receive
only 55% of recommended care 10 years after National Institute of Health
clinical trials, he said.
Ophthalmology has the highest rate of adoption. But still,
its a huge problem, Dr. Rich said.
The Physician Quality Reporting System will be augmented, and outcomes
will be publicly reported, Dr. Rich said.
Coverage for 33 million previously uninsured patients, including 22
million entering the Medicaid ranks, will pose numerous challenges. For
example, many of the newly insured patients will be minorities with a higher
incidence of ophthalmic disease. Dr. Rich has 35 years of practice reacting to
changing clinical environments and expressed optimism that challenges will be
met head on.
We have always responded to challenges by keeping patients first,
doing the right thing, and I think, both professionally and financially we are
going to be fine, he said. by Matt Hasson and Michelle
- William L. Rich III, MD, can be reached at American Academy of
Ophthalmology, Governmental Affairs Division, 1101 Vermont Ave. NW, Suite 700,
Washington, DC 20005; 202-737-6662; fax: 202-737-7061; email:
- Disclosure: Dr. Rich has no relevant financial disclosures.