Reimbursement system ‘broken’: Long-term solution needed for administrative burden
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Each year, as part of the Medicare physician fee schedule policy changes, the CMS is required to include administrative burden estimates for complying with Merit-based Incentive Payment System reporting.
In the recent 2024 Medicare physician fee schedule proposed rule, CMS proposed the following estimates for each Merit-based Incentive Payment System (MIPS) performance category:
Are these estimates of burden accurate? No, of course not.
For a moment, think about how much MIPS has affected physician practices. Estimating compliance cost is notoriously difficult, but the available studies nevertheless suggest CMS’ figures are woefully low.
Administrative burden harms physicians, patients
In a study published in JAMA Health Forum, MIPS participation required a per physician average of $12,811 and 200 administrative hours. And in International Journal of Radiation Oncology, Biology and Physics, a study of nearly 200 radiation oncology practices found a similar financial discrepancy compared with CMS estimates.
MIPS was introduced to reward physicians who deliver high-quality, value-based care. And yet, most practices say the positive payment adjustments do not even cover the time and resources spent on MIPS participation.
What has this situation led to?
It starts with administrative burden, one of the leading contributors to clinician burnout. We spend less time with patients who need us and more time managing our inbox.
But it also extends to practice ownership. According to the most recent AMA survey, only 44% of physicians own their practice, a nearly 10% drop in the last decade — and down from 76% in the 1980s. Unsurprisingly, physicians cited regulatory and administrative requirements, as well as more favorable payment rate negotiations, as primary reasons for selling practices to larger health systems.
Physicians have never given up on patients: The trade-off has been our personal well-being and the benefits of owning a practice.
Solutions must come from Congress
The reality is that only Congress has the oversight jurisdiction and authority to make any changes to Medicare reimbursement. Instead of continuing the annual routine of temporary corrections that forgo cuts at the last minute, Congress must pass a longer-term solution now.
For oversight, policymakers can start by reviewing CMS’ burden estimates in hearings and the Medicare Access and CHIP Reauthorization Act reforms. Providers who rightfully believe reimbursement does not accurately reflect the costs associated with providing services deserve a transparent process to reconcile these issues.
We also need an independent analysis of whether MIPS actually improves patient care. In the past, research has found better MIPS scores were not associated with lower rates of hospital complications, and when physicians treat medically complex and socially vulnerable patients and deliver high-quality care, they are rewarded with poor MIPS scores.
Legislative reforms start with removing the budget neutrality requirement for physician payment rates, something more than 120 medical societies support. Further, the Strengthening Medicare for Patients and Providers Act (HR 2474) would tie the annual conversion factor to the Medicare Economic Index, and I applaud the four representatives who introduced the legislation in April: U.S. Reps. Raul Ruiz, MD, (D-Calif.), Larry Bucshon, MD, (R-Ind.), Ami Bera, MD, (D-Calif.) and Mariannette Miller-Meeks, MD, (R-Iowa).
At least once a year, I meet with Congressional leaders to deliver the same message: Short-sighted patches lead to long-term damage. Practices are struggling, medical inflation is rising, consolidation is rabid, patient waiting lists are growing and the provider community is burned out.
Our reimbursement system is broken and must be fixed now.
References:
- Annual regulatory burden report: October 2022. https://www.mgma.com/getkaiasset/b7e88b99-8e93-44a9-8144-725ca956089e/10.11.2022-MGMA-Regulatory-Burden-Report-FINAL.pdf.
- Bond AM. JAMA. 2022;doi:10.1001/jama.2022.20619.
- Glance LG, JAMA Netw Open. 2021;doi:10.1001/jamanetworkopen.2021.18449.
- H.R. 2474 - Strengthening Medicare for Patients and Providers Act. https://www.congress.gov/bill/118th-congress/house-bill/2474/actions. Accessed Oct. 12, 2023.
- Jones RT, et al. Int J Radiat Oncol Biol Phys. 2021;doi:10.1016/j.ijrobp.2020.11.001.
- Khullar D, et al. JAMA Health Forum. 2021;doi:10.1001/jamahealthforum.2021.0527.
- Recent changes in physician practice arrangements: Shifts away from private practice and towards larger practice size continue through 2022. https://www.ama-assn.org/system/files/2022-prp-practice-arrangement.pdf. Accessed Oct. 4, 2023.
- https://www.aans.org/-/media/Files/AANS/Advocacy/2022-news/September/2022-9-22_AMA_Sign_On_Letter_to_Congressional_Leadership_re_Medicare_Physician_Payment.ashx. Accessed Oct. 12, 2023.
For more information:
Louis J. Wilson, MD, FACG, is medical director at Digestive Disease Research of North Texas and managing partner at Wichita Falls Gastroenterology Associates in Wichita Falls, Texas.
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