ACC’s 2011 Legislative Conference had some great afternoon speakers on Monday, including health economist Len Nichols, PhD, and Nancy Nielson, MD, senior advisor to the Centers for Medicare and Medicaid Innovation (CMMI). Both Nichols and Nielson spoke about the need for cardiovascular professionals to get involved in payment innovation. We have the knowledge on how to make it work, they said. If we don’t get involved, someone else less knowledgeable will do it for us.

Nichols talked about the winding road that is payment reform, noting that the current unaccountable fee-for-service and third-party payment system has brought us to a place where the value of care per dollar is less than it could be, prices are above minimal costs and quality is not optimal for every patient. Failure to address these issues in a way that works for patients and providers will very likely result in across-the-board cost controls and/or utilization reviews or benefit cuts, he said.

According to Nichols, new payment models will require the alignment of care coordination outside of typical boundaries, and will involve a greater level of risk to providers than the current fee-for-service system. In addition any new model, outside of pure cost or benefit reductions, will require that patients be engaged in their own care through cost-sharing, wellness education and incentives to stay healthy. Decision support also will be critical in order to ensure that clinicians and patients have right the right incentives and information to make the most appropriate care decisions and facilitate risk sharing.

Nichols is the editor-in-chief of a newly launched website, the Community on Payment Innovation, which aims to bring great ideas together and highlight innovative payment models. By using the site, which is a joint venture of the ACC and the American Journal of Managed Care, we hope to generate ideas that we can bring to federal agencies, such as CMMI, to implement.

 

Nielson discussed the different payment pilots that CMMI has underway. The health care reform law authorized $10 billion in funding to study new ways to deliver health care, and that funding is what created CMMI, Neilson said. CMMI has a unique advantage over other agencies: waiver authority. This means it has the power to do things, like offer gain-sharing, that its parent agency, the Centers for Medicare and Medicaid Services (CMS), cannot. Some of CMMI’s pilots that you may have heard of: Partnership for Patients, Pioneer Accountable Care Organizations (ACO) and the CMMI bundling initiative.

The bundling initiative is interesting for a couple of reasons. It’s based on a CMS pilot, the ACE demonstration, which looked at bundling payments for acute care for certain cardiovascular and orthopedic procedures. CMMI took this base model and looked for a way to make it more flexible for a variety of different practice environments. What it ends up being, she said, is a way to get your feet wet with a new payment method if you’re not ready to be part of an ACO. You’ll still get a fee-for-service payment, but you may also get a gain-sharing payment on top of the fee-for-service payment. In addition, participants don’t need to go all-or-nothing; you’re able to try the payment method for one or two DRGs and see how it goes.

 

Both Nichols and Nielson stressed repeatedly that payment innovation WILL happen because we simply can’t afford not to. As Nielson said: “We are in a crisis. The cost of medical care is a major issue.” I couldn’t agree more. The pilots of CMMI, if implemented nationwide, may begin to address some of the issues. We’ll need to be leaders in this though. As Jack Lewin, MD, used to say frequently while the health reform law was being drafted: If you’re not at the table, you’re on the menu. Let’s get our thinking caps on a figure out what’s the best way to innovate our payment system.