About two-thirds of the increase would be attributable to increased beneficiary enrollment and one-third would be attributable an increase in per beneficiary service use, he said. The proposed updates would reduce fees for most services, he added, but the reductions would be less than under the SGR. Primary care should be exempt from the reductions because "the most recent data show that access risks are concentrated in primary care."
Moving beyond bundling
"For many years the medical profession has been staunchly in favor of SGR repeal without being willing, in my view, to offer a quid pro quo. This appears to be changing as many medical organizations have shown leadership in encouraging physicians to adopt value-based criteria,"A. Bruce Steinwald told the committee. A former GAO employee, he is familiar with controlling spending on physician services under Medicare Part B.
With the SGR out of the way, Steinwald would expect Medicare to have "greater opportunity to use its extensive data to make distinctions between high-value and low-value care." Bundling of services and profiling physician utilization patterns could be put in place today, but other steps may require new legislation, such as requiring prior authorization for expensive diagnostic procedures or tiering beneficiary copayments according to service value. He noted that both "are used extensively in the private sector."
Baucus lamented that although physicians are eager to move to a new system with new payment models such as accountable care organizations, payment bundles, and medical homes, the models being developed by the Innovation Center at the Centers for Medicare & Medicaid Services "are not ready to replace the fee-for-service system."