“MACRA is just a gigantic illusion," said a senior fellow at the American Enterprise Institute at a briefing on the Medicare Trustees report in Washington. But a visiting scholar at the Brookings Institute said, "the Affordable Care Act is working." From Medpage Today.
Physicians are likely to be hurt by the legislation passed to repeal Medicare's sustainable growth rate reimbursement formula, several experts said at a briefing here Thursday on the Medicare trustees' report sponsored by the Brookings Institution and the American Enterprise Institute (AEI).
"Doctors are going to be livid when they absorb the fact that they spent so much political capital to enact MACRA [the Medicare Access and CHIP Reauthorization Act] only to find out ... that under the current payment system, doctors are going to get paid less; that gap will grow over time," said Robert Moffit, PhD, senior fellow in the Center for Health Studies at the Heritage Foundation, a right-leaning think tank here. "When they absorb that fact, I think we're going to see more trouble on Capitol Hill over physician payment."
At the discussion, Paul Stipalnic, Medicare's chief actuary, explained how physician reimbursement will work under MACRA. "Depending on whether the provider will ultimately be in an alternative payment model (APM) or in the Merit-based Incentive Payment System (MIPS), they will be either getting a 0.75% or 0.25% payment rate update each and every year into the future," he said. "That's the payment rate update whether inflation is 1.5% or 3% or 4%. The Medicare Economic Index is expected to increase at 2.2% for physicians, [so] this payment rate will create a gap in how payment rates will be increasing relative to what their costs will be."
Those annual payment updates do not include the payment bonuses that physicians will be eligible for under both types of payment programs, which can go up to 9% under MIPS and 5% under the APM program.
"I think MACRA is just a gigantic illusion," said James Capretta, a senior fellow at the Ethics and Public Policy Center at the AEI, another right-leaning think tank. "Basically it says the federal government is going to rank every physician on quality metrics beginning in 2019 and pay them accordingly based on their score. Call me a skeptic, but the idea that the federal government is going to do that in a way people can accept, I think there's zero chance that will happen .... I really think MACRA is headed toward massive revision at some point."
Alice Rivlin, PhD, a senior fellow at the Brookings Center for Health Policy, a left-leaning think tank, called for a two-sided approach to dealing with the MACRA reforms. "We need to give patients more skin in the game if we believe accountable care organizations (ACOs) or some other payment reform is promising -- patients need to know they're in [an ACO] and they have an incentive to participate in improving the cost-effectiveness of their care. And I believe we need to move more aggressively toward competition among plans, and move deliberately but not too fast toward premium support in Medicare. We could start with competitive bidding in Medicare Advantage."
However, she added, "We need to be sure we can make competitive bidding work, and solve the risk adjustment problem, so we don't end up ... with the sickest people in traditional Medicare."
Overall, the American public needs to understand that it is "sleepwalking" into big financial difficulties as evidenced by the trustees' report, Capretta said. "People often say, 'Who knows what it's gonna be like in 2030 and 2040?' Well, we do know what it's going to look like -- we're going to have a lot older population with a lot more demand for health services ... that's crucially important in planning ahead."
Moffit agreed. "I think we are sleepwalking into a fiscal crisis," he said, adding that although much of the trustees' report sounded "somewhat soporific ... in defense of the trustees, they actually state some really dramatic things."
As an example, Moffitt quoted the trustees as saying in the report that there is an urgent need for action to fix Medicare's financing problems. "They've been saying this for years. The problem is that members of Congress who authorized all this, are not reading this, or if they're reading it, they're ignoring it."
Other panelists seemed to take a calmer view. "The overall message I'd take away is that in the near term, the Affordable Care Act is working," said Keith Fontenot, a visiting scholar at Brookings. "In the long term, there are challenges -- providers [need] tools to sustain productivity, and there are other issues like the cost of prescription drugs."
Rivlin, a former Federal Reserve governor and White House budget director, also agreed that more still needs to be done. "Given the fact that Medicare is such a vital program ... and so essential to seniors and the disabled, solving its problems will take a bipartisan effort," she said. "And you might not think we're going to get that in this highly polarized political system, but surprisingly that's not true of Medicare .... Quite a lot of bipartisan activity is happening; there is an explosion of experiments in payment being tried and evaluated."
Panelists also were uniformly critical of the Independent Payment Advisory Board, an organization set up under the Affordable Care Act (ACA) that is supposed to make recommendations to Congress about cutting Medicare costs in the event that the projected Medicare budget is expected to exceed a given target in a particular year. "I'm a skeptic of the approach of tinkering with Medicare costs on year-by-year basis," said Rivlin.
Moffit agreed. "Remember this: IPAB is one crude thing, the ultimate blunt axe for controlling costs," he said. The only thing the board ... can do is basically to reduce provider payments. They can't do too much beyond that. This is a controversial [ACA] provision and I don't think it will survive."