GAO Finds Physician Profiling Can Work

HealthLeaders Media Staff, October 28, 2009

A formula being considered by the Centers for Medicare and Medicaid Services (CMS) that reflects how physicians use resources—ranging from hospital services to durable medical equipment—and how that influences patients’ decisions appears to work, according to a new report from the U.S. Government Accountability Office (GAO).

In 2008, the Medicare Improvements for Patients and Providers Act directed the Department of Health and Human Services Secretary to develop a program to provide physicians with confidential feedback on the Medicare resources they used to provide care to Medicare patients. GAO was asked to evaluate the "per capita methodology" for profiling physicians—a method that measured a patient’s resource use over a fixed period of time and connected that resource use to physicians.

GAO focused its study on four "diverse specialties": a medical specialty (cardiology), a diagnostic specialty (diagnostic radiology), a primary care specialty (internal medicine), and a surgical specialty (orthopedic surgery). Four metropolitan areas—Miami, Phoenix, Pittsburgh, and Sacramento, CA—were selected for their geographic diversity, range in average Medicare spending per beneficiary, and number of physicians in each of the four specialties. Study was limited to physicians who participated in Medicare fee for service.

To measure individual Medicare patients' resource use, GAO initially made adjustments for the patients' health conditions. They were placed into 25 risk categories.

Using a per capita method to profile specialists, GAO found that their practice patterns—as measured by the level of their resource use—was relatively stable over 2005 and 2006 despite high patient turnover. This is true despite two facts: the physicians’ resource use was derived from their patients’ resource use and that the specific patients whom physicians see were not always the same every year.

In each of the four metropolitan areas, physicians showed greater stability in their resource use than individual patients—although the percentages varied.

Patients seen by "high-resource use" physicians generally were heavier users of institutional services (such as hospital services) than those seen by lower resource use physicians. GAO noted that institutional services were the "major driver of Medicare expenditures" for beneficiaries in physicians' practices—accounting on average for 54% of expenditures.

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