The Hill reports on a proposal that is floating in Congress to change Medicare payment methodologies that has an unusual and perhaps effective set of sponsors behind it:
New legislation from Sens. Ron Wyden (D-Ore.) and Johnny Isakson (R-Ga.) and Reps. Erik Paulsen (R-Minn.) and Peter Welch (D-Vt.) would attempt to improve care for chronically ill seniors by revamping how their providers are paid.
Under the bill, voluntary “Better Care” plans and practices would specialize in treating patients with multiple chronic conditions. In return, they would receive specially tailored payments that reward good outcomes.
AARP backed the legislation in a statement, noting that 75 percent of healthcare dollars are spent on chronic disease.
“It is important to better coordinate and improve the quality of care for these individuals … rather than to just ask individuals to continue to pay more for their healthcare,” said AARP Legislative Policy Director David Certner in a statement.
The proposal seems to be a low strings attached capitation model with risk adjustments based on member age and pre-exisiting health conditions. The AP has some more details:
The new proposal would build on the accountable care framework in the health care law. The new “better care” organizations would be paid a flat fee per patient. They would have more leeway on how to spend that money than is currently allowed under Medicare rules, for example, by charging lower copayments for certain kinds of high-value services. They would also be able to specialize in dealing with particular conditions.
Each senior who signs up with one of the groups would receive an individual care plan that would reflect their particular situation.
This is a capitated payment model for high cost Medicare patients. The basic goal is to create customized health plans and payment models where coordinated care solves problems before they become expensive.
It is a twist on the Accountable Care Organizations (ACO) from PPACA as these better care programs (BCP) would not be paid from shared savings which is how the ACOs make their business case but from a flat payment where the government automatically saves. Additionally, ACOs can’t directly bill for case management, instead they pay for case management from averted costs. BCPs would have very few strings attached to their monthly capitated payment so they could spend the money however they wished.
This is an interesting attempt to take several Medicare demonstration projects to scale. The goal is to realign incentives away from segmented, more is better care to comprehensive care. The ACO model is a segmented but comprehensive care model. The BCP is an integrated/universal comprehensive care model.
In a rational political system, this is the type of bill that should easily advance as it addresses several concerns and priorities of all relevant stakeholders and veto players. I consider the chance of enactment to be slightly higher than the Patriots drafting a quarterback in the first round of the 2014 NFL draft.