White House rolls out major shift in Medicare payments

White House rolls out major shift in Medicare payments
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The Obama administration on Friday rolled out its long-awaited rules for shifting how Medicare pays doctors, implementing changes made by a bipartisan law Congress passed last year.

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The changes are part of the administration’s larger effort to shift healthcare payments away the traditional system of paying doctors a fee for each test or procedure provided, and toward a system that rewards doctors for improving patient health.

In the long run, the goal is to save Medicare money and encourage doctors to provide higher quality care. 

The changes announced Friday are the result of the “doc fix” law that Congress passed in 2015, which replaced a system of impending cuts to physician payments that lawmakers put off in an annual Washington ritual. 

The changes in Medicare payments through the new law have been a rare area of bipartisanship in healthcare policy.

Senate Finance Committee Chairman Orrin HatchOrrin Grant HatchLobbying world Congress, stop holding 'Dreamers' hostage Drug prices are declining amid inflation fears MORE (R-Utah), for example, released a statement Friday praising the administration and the Centers for Medicare and Medicaid Services (CMS) for allowing for flexibility as the changes go forward, addressing concerns about the impact on doctors who are not used to the new system.

“It demonstrates CMS’s continued commitment to working with American health care providers and reflects the shared goal of allowing doctors and medical centers to shift to the new payment system by participating in the reforms at their own pace,” Hatch said in the statement. 

White House deputy chief of staff Kristie Canegallo noted on a call with reporters Friday that even a “historically gridlocked Congress” passed the 2015 law and was on board with the idea of changing how Medicare pays for care. 

Under the new system, doctors can choose one of two main tracks for how they get paid under Medicare. 

The first is called the Merit-based Incentive Payment System (MIPS). It pays doctors a bonus if they meet quality targets under a range of standards, such as the percentage of women of a certain age who were screened for breast cancer. On the flip side, if doctors fail to meet the standards, they see their pay cut. 

The second track is for doctors who are further along in adapting to the new methods of payment, and involves “advanced” payment models pegged to quality of care. Those include groups of doctors who come together to coordinate care and who get to keep some of the money Medicare saves if they lower costs. 

The CMS has emphasized that it is working with doctors to try to implement the changes, and the American Medical Association gave positive initial comments, pointing to efforts to ease in the new requirements.

“Our initial review indicates that CMS has been responsive to many of the concerns raised by the AMA,” the doctors group said in a statement.