Changing payments, changing practice

The first article during my tenure as editor of the “Practice Management: The Road Ahead” section of Clinical Gastroenterology and Hepatology published in July 2012 (Clin Gastroenterol Hepatol. 2012;10:692-6) outlined anticipated changes in health care delivery, due in large part to mandates or trends contained in the Patient Protection and Affordable Care Act. A second article was published in 2013 (Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8). In this month’s column, Spencer D. Dorn, MD, MPH, MHA, of the University of North Carolina at Chapel Hill, adds a third update with an article focused on alternative payment models. These new reimbursement models are becoming common and will be part of all of our practice strategies in the years to come. No matter what occurs in the 2016 election, the movement from volume- to value-based payment will continue relentlessly, and practices that do not understand how to respond will struggle. We hope these articles will kick-start conversations in your practice.

Fee-for-service (FFS) reimbursement has been criticized for encouraging quantity over quality, favoring procedures over cognitive services, and fragmenting care.1 The landmark Patient Protection and Affordable Care Act (ACA) and more recent Medicare Access and Children’s Health Insurance Program Reauthorization Act (MACRA) modify Medicare’s FFS and encourage alternative payment models (APMs) that better reward value than volume.

Prior articles in this series have identified the specific trends driving gastroenterology practice strategies and business decisions,2 including an increasing need to demonstrate value, an emphasis on improved population health, an increasing number of practices becoming employees of large integrated delivery networks, reduced FFS reimbursements that are more closely linked to performance metrics, and increasing demands for risk-based contracts.3 In this article, I dive more deeply into these last two trends (declining FFS and the rise of APMs) and consider strategies gastroenterology practices can take in response.

Changes in fee for service

The ACA directed the secretary of Health and Human Services to establish a formal process to review potentially misvalued procedure codes. Compared with the pre-ACA fee schedule, the final 2016 Medicare Physician Fee Schedule includes cuts to professional fees for upper endoscopy, endoscopic retrograde cholangiopancreatography, endoscopic ultrasound, and colonoscopy. At the same time, over the past decade, facility fees paid for procedures performed in hospital outpatient departments have increased. Those to ambulatory surgery centers have gradually increased, although they still remain far below pre-2008 levels. Thus, the full economic impact of fee revaluation on an individual gastroenterology practice depends on whether it collects associated facility and ancillary fees.4

In addition, in the 2016 fee schedule, the Centers for Medicare & Medicaid Services described its intention to remove the value of moderate sedation from all gastrointestinal procedures. This is to prevent paying twice for sedation in procedures that involve anesthesiology professionals (i.e., one payment to the endoscopist as part of the overall procedure fee and a separate payment to the anesthesia professional for sedation they provide and bill for separately). The American Medical Association/Specialty Society Relative Value Scale Update Committee, using survey data from the GI specialty societies and other specialties that perform their own moderate sedation, has submitted recommendations for the value of a new set of moderate sedation Current Procedural Terminology codes to the CMS. The agency is expected to provide the specifics on how it will remove moderate sedation from the GI procedure codes in the 2017 Medicare Physician Fee Schedule Proposed Rule. The more that moderate sedation is valued, the less that endoscopic procedures will be valued. Consequently, gastroenterologists who rely on anesthesiology professionals to sedate their patients will generate less revenue per procedure, unless they rearrange contracts with anesthesia providers. Gastroenterologists who perform moderate sedation will not be impacted, because the sum of the value of the new moderate sedation code plus the underlying endoscopic procedure code will equal the original value of the procedure.

Beyond revaluing services, the CMS outlined its rather ambitious goal “to have 85% of all Medicare fee-for-service (FFS) payments tied to quality or value by 2016, and 90% by 2018.”5 Currently this includes the Physician Quality Reporting System (PQRS), which requires gastroenterologists to report performance on either three or more individual PQRS measures or one PQRS measures group (collection of related individual measures) or face a 2% Medicare payment penalty. It also includes the value-based payment modifier, through which by 2017 all practices with better-than-average quality (linked to PQRS measures) and lower costs will receive bonus payments, whereas those with worse-than-average performance (or who choose not to report) will be penalized.

MACRA changes all of this. Starting in 2019, the meaningful use incentive program, PQRS, and value-based payment modifier will be consolidated into the Merit-Based Incentive Payment System (MIPS). Physicians who elect to remain on an FFS tract will receive a 0-100 composite performance score based on quality (30%), resource use (30%), meaningful use (25%), and clinical practice improvement activities (15%). At the start of a performance period, a composite threshold necessary to achieve incentive payments and avoid penalties will be determined. Throughout the performance period, physicians will receive timely feedback on their performance. At year’s end, those below the threshold will face penalties proportionate to their performance (as much as 4% in 2019 and going up to 9% in 2022), those at threshold will not receive a payment adjustment, and those above threshold will receive bonuses proportionate to their performance (although overall payments will be capped at $500 million).

Alternative payment models

The CMS’s ultimate goal is to move beyond FFS and have “30% of Medicare payments tied to quality or value through APMs by the end of 2016 and 50% of payments by the end of 2018.”5 MACRA supports this ambitious goal: Starting in 2019, providers who “sufficiently” participate in APMs will receive 5% across-the-board bonuses. The three main APMs are bundled payments, accountable care organizations (ACOs), and patient-centered medical homes.

A bundled payment is a single fixed price paid to cover services for a specific episode of care. Depending on how an episode is defined, the bundle may encompass all professional fees, facility fees, and medical device and supply costs for a given service, including postacute care and any complications. If costs are reduced beyond the already discounted price of the bundle and quality metrics are achieved, then participants share the savings. Conversely, if costs exceed the bundled payment amount, then participants lose money. Unlike FFS, bundling incentivizes participants to coordinate care, reduce complications and unnecessary services, and cut purchasing costs.

To date, the CMS has launched three bundling programs. The Acute Care Episode Demonstration Project provided hospitals and clinicians a bundled payment to cover orthopedic and cardiovascular procedure–related episodes of care. This program reduced Medicare costs, primarily because the bundle payment was lower than what the sum of individual payments would have been. Providers were able to cope mainly by reducing their surgical implant costs. Second, more than 6,000 providers are currently participating in Medicare’s Bundled Payments for Care Improvement Program. The results of this program have not yet been released. Third, the CMS recently announced the Comprehensive Care for Joint Replacement Program under which hospitals and physicians in 67 metropolitan areas will be required to participate. Mandatory participation signals the CMS’s strong motivation to shift away from FFS. Beyond Medicare, many commercial insurers offer bundled payment programs, primarily for cardiovascular and orthopedic conditions.⁶ Although these programs are promising, it is technically challenging to define what is in a bundle, and to adequately risk adjust and mitigate random variation in spending for certain episodes of care. Providers are also challenged to find ways to divide payment among participants, coordinate all care, and accept financial risk.^7,8 The American Gastroenterological Association recently published a bundled payment framework for screening and surveillance colonoscopy.⁹ Bundling other gastroenterology services will be more challenging.

Whereas bundled-care programs focus on a discrete service (e.g., knee replacement or colonoscopy), ACOs are integrated groups of providers who jointly assume responsibility for the cost and quality of all care delivered to a defined population. The ACA requires ACOs to have formal legal, leadership, and management structures; care for at least 5,000 Medicare beneficiaries; fulfill certain patient-centeredness criteria; measure and report quality and cost data; and coordinate care. Different payment models incentivize ACOs to reduce costs and improve quality of care. ACOs operating under a one-sided shared savings model receive FFS payments for each service delivered, along with a bonus for reducing costs below a spending target and meeting quality requirements. There are no potential financial penalties. Alternatively, ACOs operating under a two-sided risk-savings model share a greater proportion of cost savings, in exchange for potential financial penalties if the cost of care exceeds target spending.

To date, Medicare-sponsored ACOs have produced mixed results. In 2014 only 92 of the 322 Medicare Shared Savings ACOs were able to reduce spending below a predetermined benchmark by a predetermined amount (2%-3%) while meeting quality scores, thereby earning a bonus ($341 million in total). Similarly, of the original 32 pioneer ACOs, which by definition are more experienced at managing population health and more willing to take on financial risk, 13 dropped out of the program, and in 2014, only 11 generated enough savings to earn a payout ($82 million in total), whereas 5 incurred financial penalties ($9 million in total) for costs exceeding target thresholds.¹⁰ In total, after paying out bonuses, the ACO program cost Medicare a net loss of nearly $3 million, far from the $10-$240 million Medicare had previously projected it would save through the ACO program.¹¹ Clearly, ACOs are not a quick fix for all that ails health care. For many ACOs, the major start-up requirements (time, capital investments, and so forth) needed to manage a population may not be worthwhile.¹² Nonetheless, the CMS recently launched the Next Generation ACO model through which 21 participating ACOs will assume higher levels of financial risk (possibly capitated payments) in exchange for greater potential rewards. Similarly, beyond Medicare, there are also many Medicaid-sponsored ACOs and hundreds of commercial payer-sponsored ACOs.¹³

Finally, practices can qualify for APM status without accepting bundled payments or joining an ACO by qualifying as a patient-centered medical home. One option for gastroenterologists and other specialists is the National Committee for Quality Assurance’s patient-centered specialty practice designation, available to practices that successfully demonstrate their ability to track and coordinate care with primary care providers and other specialists, offer timely appointments and responses to telephone and electronic messages, use evidence-based tools to manage care for specific patient populations, develop patient-centered care plans, and measure and improve performance.¹⁴

Consolidation

Health insurers are merging to increase scale (and negotiating power), enhance efficiency (reducing administrative costs makes more room for profits), and diversify their businesses. Recently proposed acquisitions will bring “the big five” health insurers to the “big three.” Likewise, health care systems are rapidly acquiring hospitals and physician groups, so much so that today half of all American health care markets are now considered highly concentrated, and none are considered highly competitive.¹⁵ Today only 35% of all physicians are independently employed.¹⁶ Physicians employed by health systems trade their complete autonomy to offset declining reimbursement, reduce operating expenses (including health information technology costs), improve work-life balance, and mitigate unknown risks.

Proponents contend that these mergers allow health care systems to better coordinate care, improve care experiences, accommodate new payment models, and assemble the building blocks needed to form ACOs and other integrated care models. Critics argue that locally dominant systems drive volume (by tightening referral relationships and gaining new market share) and increase costs (through enhanced negotiating leverage and by reclassifying newly acquired physician practices as part of the hospital, thereby generating facility fees). It is unclear whether consolidation results in better outcomes or simply increases overall costs.¹⁷

Strategic imperatives

What should gastroenterologists do? First, recognize that FFS is not going away anytime soon.¹⁸ Most APMs are still largely in their experimentation phase, and it remains unclear which models will work and which will be broadly adopted. Still, it is unrealistic to expect FFS to indefinitely persist as the dominant payment model. For some services FFS may no longer be a payment option (e.g., Medicare’s BCPI [Bundled Payments for Care Improvement]). For others, FFS rates may become so unattractive that APMs seem necessary. Finally, APMs may allow some practices to capture a greater proportion of overall clinical revenue (e.g., academic practices that perform endoscopic procedures within hospital outpatient departments) and to develop new models that meaningfully improve care. Today’s gastroenterology practices must therefore operate on two separate tracks: an FFS track that rewards volume (most practices are optimized for this) and an alternative payment track that rewards value (few practices can accommodate these on their own). The degree and speed with which practices should reorient to the alternative payment track depends on the type of practice and the specific local health care market. But even practices operating in slower-to-evolve markets should start preparing for the APMs, no matter how far off in the distance they may seem. I recommend the following six steps:

1. Integrate. To participate in APMs, preserve referral streams, and maintain negotiating leverage with health plans, independent, community-based practices may need to affiliate or merge with other physician groups, or align with or be acquired by a health care system.¹⁹ Academic practices are challenged to define their role within health care systems that are rapidly adding primary care practices, and often community gastroenterology practices, too.

2. Collaborate and communicate. To deliver high-value care to populations of patients, gastroenterologists must closely collaborate and clearly communicate with primary care physicians and other specialists. Collaborative care agreements can help guide these relationships.²⁰3. Develop new models of care. Patients with more routine GI and liver-related problems may be served more cost effectively by midlevel providers²¹ or innovative solutions, such as e-consultations.²² Patients with complex, chronic GI and liver diseases may be best served by multidisciplinary care teams (e.g., gastroenterologists alongside midlevel providers, nurses, care managers, psychologists, and/or pharmacists) who use clinical information systems to identify high-risk patients and to encourage evidence-based decision making, and who support patients to self-manage their own conditions.²³ Previously infeasible in a purely FFS world, these models are encouraged by APMs.

4. Care for common, costly conditions. Most gastroenterology practices have built robust colorectal cancer screening programs, sometimes at the expense of cognitive-based services. In today’s more accountable world, practices that can effectively manage common, costly conditions, such as inflammatory bowel disease, functional GI disorders, and advanced liver diseases, will be rewarded better than before and will be more highly sought as partners.

5. Understand and contain costs. The timely, accurate data needed to effectively respond to APMs are challenging to come by.¹⁹ Individual clinicians and group practices can roughly gauge their costs of care for Medicare beneficiaries, compared with other practices, using CMS Quality Resource Utilization Reports. Local commercial insurers may be willing to share cost profiles with interested practices. Strategies to reduce costs may include shifting clinically appropriate patients to more cost-effective settings (especially important for academic practices that see the bulk of their patients in costly hospital outpatient departments), standardizing endoscopy supplies and devices, using anesthesia services more selectively, and preferentially prescribing generic drugs, among others.

6. Measure and demonstrate value. Despite the inherent limitations of performance measurement,²⁴ it is imperative that practices measure and report the value of care to their patients, community, and payers so that they are preferred partners and not locked out of insurance or referral networks. Improving patient experiences is intrinsically worthwhile²⁵ and also makes good business sense.²⁶

References

1. Miller, H.D. Creating payment systems to accelerate value-driven health care: Issues and options for policy reform. New York: The Commonwealth Fund, 2007.

2. Allen, J.I. The road ahead. Clin Gastroenterol Hepatol. 2012;10:692–6.

3. Allen, J.I. Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8.

4. Dorn, S.D., Vesy C.J. Medicare’s revaluation of gastrointestinal endoscopic procedures: Implications for academic and community-based practices. Clin Gastroenterol Hepatol. 2016 (in press).

5. Burwell, S.M. Setting value-based payment goals: HHS efforts to improve U.S. health care (N Engl J Med. 2015;372:897–9).

6. The Advisory Board Company. Commercial Bundled Payment Tracker, 2016.

7. Mechanic, R.E. Mandatory Medicare bundled payment – is it ready for prime time? N Engl J Med. 2015;373:1291–3.

8. The National Commission on Physician Payment Reform. Physician Payment Report, 2013.

9. Brill, J.V., Jain, R., Margolis, P.S., et al. A bundled payment framework for colonoscopy performed for colorectal cancer screening or surveillance. Gastroenterology. 2014;146:849–53, e9.

10. Evans, M. Few Medicare ACOs earned bonuses in 2014. Mod Healthc (2015). Available at: www.modernhealthcare.com/article/20150825/NEWS/150829922. Accessed Nov. 14, 2015.

11. Rau, J., Gold, J. Medicare yet to save money through heralded medical payment model. Kaiser Health News. Available at: http://khn.org/news/medicare-yet-to-save-money-through-heralded-medical-payment-model. Accessed Nov. 14, 2015.

12. Goldmsith, J., Kaufman, N. Pioneer ACOs: Anatomy of a victory. Health Affairs Blog, 2015.

13. Tu, T., Muhlestein, D., Kocot, S.L., et al. The impact of accountable care: Origins and future of accountable care organizations. Washington, D.C.: Brookings Institution, 2015.

14. NCQA. Patient-centered specialty practice frequently asked questions.

15. Xu, T., Wu, A.W., Makary, M.A. The potential hazards of hospital consolidation: Implications for quality, access, and price. JAMA. 2015;314:1337–8.

16. The Physician’s Foundation. 2014 survey of America’s physicians. Practice patterns & perspectives: The Physician’s Foundation.

17. Tsai, T.C., Jha, A.K. Hospital consolidation, competition, and quality: Is bigger necessarily better? JAMA. 2014;312:29–30.

18. Ginsburg, P.B. Fee-for-service will remain a feature of major payment reforms, requiring more changes in Medicare physician payment. Health Aff (Millwood). 2012;31:1977–83.

19. Friedberg, M.W., Chen, P.G., White, C., et al. Effects of health care payment models on physician practice in the United States. Santa Monica, Calif.: RAND Corp., 2015.

20. Greenberg, J.O., Barnett, M.L., Spinks, M.A., et al. The “medical neighborhood”: Integrating primary and specialty care for ambulatory patients. JAMA Intern Med. 2014;174:454–7.

21. Dorn, S.D. Mid-level providers in gastroenterology. Am J Gastroenterol. 2010;105:246–51.

22. Wasfy, J.H., Rao, S.K., Kalwani, N., et al. Longer term impact of cardiology e-consults. Am Heart J. 2016;173:86–93.

23. Coleman, K., Austin, B.T., Brach, C., et al. Evidence on the chronic care model in the new millennium. Health Aff (Millwood). 2009;28:75–85.

24. Dorn, S.D. Quality measurement in gastroenterology: confessions of a realist. Clin Gastroenterol Hepatol. 2016;14:648–50.

25. Berwick, D.M. Measuring physicians’ quality and performance: adrift on Lake Wobegon. JAMA. 2009;302:2485-6.

26. Browne, K., Roseman, D., Shaller, D., et al. Analysis & commentary. Measuring patient experience as a strategy for improving primary care. Health Aff (Millwood). 2010;29:921–5.

Dr. Dorn is vice chief, division of gastroenterology and hepatology, associate professor of medicine, health policy & management, University of North Carolina at Chapel Hill. He has received honoraria for consulting and presentations on health reform from AbbVie and Olympus.

The first article during my tenure as editor of the “Practice Management: The Road Ahead” section of Clinical Gastroenterology and Hepatology published in July 2012 (Clin Gastroenterol Hepatol. 2012;10:692-6) outlined anticipated changes in health care delivery, due in large part to mandates or trends contained in the Patient Protection and Affordable Care Act. A second article was published in 2013 (Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8). In this month’s column, Spencer D. Dorn, MD, MPH, MHA, of the University of North Carolina at Chapel Hill, adds a third update with an article focused on alternative payment models. These new reimbursement models are becoming common and will be part of all of our practice strategies in the years to come. No matter what occurs in the 2016 election, the movement from volume- to value-based payment will continue relentlessly, and practices that do not understand how to respond will struggle. We hope these articles will kick-start conversations in your practice.

Fee-for-service (FFS) reimbursement has been criticized for encouraging quantity over quality, favoring procedures over cognitive services, and fragmenting care.1 The landmark Patient Protection and Affordable Care Act (ACA) and more recent Medicare Access and Children’s Health Insurance Program Reauthorization Act (MACRA) modify Medicare’s FFS and encourage alternative payment models (APMs) that better reward value than volume.

Prior articles in this series have identified the specific trends driving gastroenterology practice strategies and business decisions,2 including an increasing need to demonstrate value, an emphasis on improved population health, an increasing number of practices becoming employees of large integrated delivery networks, reduced FFS reimbursements that are more closely linked to performance metrics, and increasing demands for risk-based contracts.3 In this article, I dive more deeply into these last two trends (declining FFS and the rise of APMs) and consider strategies gastroenterology practices can take in response.

Changes in fee for service

The ACA directed the secretary of Health and Human Services to establish a formal process to review potentially misvalued procedure codes. Compared with the pre-ACA fee schedule, the final 2016 Medicare Physician Fee Schedule includes cuts to professional fees for upper endoscopy, endoscopic retrograde cholangiopancreatography, endoscopic ultrasound, and colonoscopy. At the same time, over the past decade, facility fees paid for procedures performed in hospital outpatient departments have increased. Those to ambulatory surgery centers have gradually increased, although they still remain far below pre-2008 levels. Thus, the full economic impact of fee revaluation on an individual gastroenterology practice depends on whether it collects associated facility and ancillary fees.4

In addition, in the 2016 fee schedule, the Centers for Medicare & Medicaid Services described its intention to remove the value of moderate sedation from all gastrointestinal procedures. This is to prevent paying twice for sedation in procedures that involve anesthesiology professionals (i.e., one payment to the endoscopist as part of the overall procedure fee and a separate payment to the anesthesia professional for sedation they provide and bill for separately). The American Medical Association/Specialty Society Relative Value Scale Update Committee, using survey data from the GI specialty societies and other specialties that perform their own moderate sedation, has submitted recommendations for the value of a new set of moderate sedation Current Procedural Terminology codes to the CMS. The agency is expected to provide the specifics on how it will remove moderate sedation from the GI procedure codes in the 2017 Medicare Physician Fee Schedule Proposed Rule. The more that moderate sedation is valued, the less that endoscopic procedures will be valued. Consequently, gastroenterologists who rely on anesthesiology professionals to sedate their patients will generate less revenue per procedure, unless they rearrange contracts with anesthesia providers. Gastroenterologists who perform moderate sedation will not be impacted, because the sum of the value of the new moderate sedation code plus the underlying endoscopic procedure code will equal the original value of the procedure.

Beyond revaluing services, the CMS outlined its rather ambitious goal “to have 85% of all Medicare fee-for-service (FFS) payments tied to quality or value by 2016, and 90% by 2018.”5 Currently this includes the Physician Quality Reporting System (PQRS), which requires gastroenterologists to report performance on either three or more individual PQRS measures or one PQRS measures group (collection of related individual measures) or face a 2% Medicare payment penalty. It also includes the value-based payment modifier, through which by 2017 all practices with better-than-average quality (linked to PQRS measures) and lower costs will receive bonus payments, whereas those with worse-than-average performance (or who choose not to report) will be penalized.

MACRA changes all of this. Starting in 2019, the meaningful use incentive program, PQRS, and value-based payment modifier will be consolidated into the Merit-Based Incentive Payment System (MIPS). Physicians who elect to remain on an FFS tract will receive a 0-100 composite performance score based on quality (30%), resource use (30%), meaningful use (25%), and clinical practice improvement activities (15%). At the start of a performance period, a composite threshold necessary to achieve incentive payments and avoid penalties will be determined. Throughout the performance period, physicians will receive timely feedback on their performance. At year’s end, those below the threshold will face penalties proportionate to their performance (as much as 4% in 2019 and going up to 9% in 2022), those at threshold will not receive a payment adjustment, and those above threshold will receive bonuses proportionate to their performance (although overall payments will be capped at $500 million).

Alternative payment models

The CMS’s ultimate goal is to move beyond FFS and have “30% of Medicare payments tied to quality or value through APMs by the end of 2016 and 50% of payments by the end of 2018.”5 MACRA supports this ambitious goal: Starting in 2019, providers who “sufficiently” participate in APMs will receive 5% across-the-board bonuses. The three main APMs are bundled payments, accountable care organizations (ACOs), and patient-centered medical homes.

A bundled payment is a single fixed price paid to cover services for a specific episode of care. Depending on how an episode is defined, the bundle may encompass all professional fees, facility fees, and medical device and supply costs for a given service, including postacute care and any complications. If costs are reduced beyond the already discounted price of the bundle and quality metrics are achieved, then participants share the savings. Conversely, if costs exceed the bundled payment amount, then participants lose money. Unlike FFS, bundling incentivizes participants to coordinate care, reduce complications and unnecessary services, and cut purchasing costs.

To date, the CMS has launched three bundling programs. The Acute Care Episode Demonstration Project provided hospitals and clinicians a bundled payment to cover orthopedic and cardiovascular procedure–related episodes of care. This program reduced Medicare costs, primarily because the bundle payment was lower than what the sum of individual payments would have been. Providers were able to cope mainly by reducing their surgical implant costs. Second, more than 6,000 providers are currently participating in Medicare’s Bundled Payments for Care Improvement Program. The results of this program have not yet been released. Third, the CMS recently announced the Comprehensive Care for Joint Replacement Program under which hospitals and physicians in 67 metropolitan areas will be required to participate. Mandatory participation signals the CMS’s strong motivation to shift away from FFS. Beyond Medicare, many commercial insurers offer bundled payment programs, primarily for cardiovascular and orthopedic conditions.⁶ Although these programs are promising, it is technically challenging to define what is in a bundle, and to adequately risk adjust and mitigate random variation in spending for certain episodes of care. Providers are also challenged to find ways to divide payment among participants, coordinate all care, and accept financial risk.^7,8 The American Gastroenterological Association recently published a bundled payment framework for screening and surveillance colonoscopy.⁹ Bundling other gastroenterology services will be more challenging.

Whereas bundled-care programs focus on a discrete service (e.g., knee replacement or colonoscopy), ACOs are integrated groups of providers who jointly assume responsibility for the cost and quality of all care delivered to a defined population. The ACA requires ACOs to have formal legal, leadership, and management structures; care for at least 5,000 Medicare beneficiaries; fulfill certain patient-centeredness criteria; measure and report quality and cost data; and coordinate care. Different payment models incentivize ACOs to reduce costs and improve quality of care. ACOs operating under a one-sided shared savings model receive FFS payments for each service delivered, along with a bonus for reducing costs below a spending target and meeting quality requirements. There are no potential financial penalties. Alternatively, ACOs operating under a two-sided risk-savings model share a greater proportion of cost savings, in exchange for potential financial penalties if the cost of care exceeds target spending.

To date, Medicare-sponsored ACOs have produced mixed results. In 2014 only 92 of the 322 Medicare Shared Savings ACOs were able to reduce spending below a predetermined benchmark by a predetermined amount (2%-3%) while meeting quality scores, thereby earning a bonus ($341 million in total). Similarly, of the original 32 pioneer ACOs, which by definition are more experienced at managing population health and more willing to take on financial risk, 13 dropped out of the program, and in 2014, only 11 generated enough savings to earn a payout ($82 million in total), whereas 5 incurred financial penalties ($9 million in total) for costs exceeding target thresholds.¹⁰ In total, after paying out bonuses, the ACO program cost Medicare a net loss of nearly $3 million, far from the $10-$240 million Medicare had previously projected it would save through the ACO program.¹¹ Clearly, ACOs are not a quick fix for all that ails health care. For many ACOs, the major start-up requirements (time, capital investments, and so forth) needed to manage a population may not be worthwhile.¹² Nonetheless, the CMS recently launched the Next Generation ACO model through which 21 participating ACOs will assume higher levels of financial risk (possibly capitated payments) in exchange for greater potential rewards. Similarly, beyond Medicare, there are also many Medicaid-sponsored ACOs and hundreds of commercial payer-sponsored ACOs.¹³

Finally, practices can qualify for APM status without accepting bundled payments or joining an ACO by qualifying as a patient-centered medical home. One option for gastroenterologists and other specialists is the National Committee for Quality Assurance’s patient-centered specialty practice designation, available to practices that successfully demonstrate their ability to track and coordinate care with primary care providers and other specialists, offer timely appointments and responses to telephone and electronic messages, use evidence-based tools to manage care for specific patient populations, develop patient-centered care plans, and measure and improve performance.¹⁴

Consolidation

Health insurers are merging to increase scale (and negotiating power), enhance efficiency (reducing administrative costs makes more room for profits), and diversify their businesses. Recently proposed acquisitions will bring “the big five” health insurers to the “big three.” Likewise, health care systems are rapidly acquiring hospitals and physician groups, so much so that today half of all American health care markets are now considered highly concentrated, and none are considered highly competitive.¹⁵ Today only 35% of all physicians are independently employed.¹⁶ Physicians employed by health systems trade their complete autonomy to offset declining reimbursement, reduce operating expenses (including health information technology costs), improve work-life balance, and mitigate unknown risks.

Proponents contend that these mergers allow health care systems to better coordinate care, improve care experiences, accommodate new payment models, and assemble the building blocks needed to form ACOs and other integrated care models. Critics argue that locally dominant systems drive volume (by tightening referral relationships and gaining new market share) and increase costs (through enhanced negotiating leverage and by reclassifying newly acquired physician practices as part of the hospital, thereby generating facility fees). It is unclear whether consolidation results in better outcomes or simply increases overall costs.¹⁷

Strategic imperatives

What should gastroenterologists do? First, recognize that FFS is not going away anytime soon.¹⁸ Most APMs are still largely in their experimentation phase, and it remains unclear which models will work and which will be broadly adopted. Still, it is unrealistic to expect FFS to indefinitely persist as the dominant payment model. For some services FFS may no longer be a payment option (e.g., Medicare’s BCPI [Bundled Payments for Care Improvement]). For others, FFS rates may become so unattractive that APMs seem necessary. Finally, APMs may allow some practices to capture a greater proportion of overall clinical revenue (e.g., academic practices that perform endoscopic procedures within hospital outpatient departments) and to develop new models that meaningfully improve care. Today’s gastroenterology practices must therefore operate on two separate tracks: an FFS track that rewards volume (most practices are optimized for this) and an alternative payment track that rewards value (few practices can accommodate these on their own). The degree and speed with which practices should reorient to the alternative payment track depends on the type of practice and the specific local health care market. But even practices operating in slower-to-evolve markets should start preparing for the APMs, no matter how far off in the distance they may seem. I recommend the following six steps:

1. Integrate. To participate in APMs, preserve referral streams, and maintain negotiating leverage with health plans, independent, community-based practices may need to affiliate or merge with other physician groups, or align with or be acquired by a health care system.¹⁹ Academic practices are challenged to define their role within health care systems that are rapidly adding primary care practices, and often community gastroenterology practices, too.

2. Collaborate and communicate. To deliver high-value care to populations of patients, gastroenterologists must closely collaborate and clearly communicate with primary care physicians and other specialists. Collaborative care agreements can help guide these relationships.²⁰3. Develop new models of care. Patients with more routine GI and liver-related problems may be served more cost effectively by midlevel providers²¹ or innovative solutions, such as e-consultations.²² Patients with complex, chronic GI and liver diseases may be best served by multidisciplinary care teams (e.g., gastroenterologists alongside midlevel providers, nurses, care managers, psychologists, and/or pharmacists) who use clinical information systems to identify high-risk patients and to encourage evidence-based decision making, and who support patients to self-manage their own conditions.²³ Previously infeasible in a purely FFS world, these models are encouraged by APMs.

4. Care for common, costly conditions. Most gastroenterology practices have built robust colorectal cancer screening programs, sometimes at the expense of cognitive-based services. In today’s more accountable world, practices that can effectively manage common, costly conditions, such as inflammatory bowel disease, functional GI disorders, and advanced liver diseases, will be rewarded better than before and will be more highly sought as partners.

5. Understand and contain costs. The timely, accurate data needed to effectively respond to APMs are challenging to come by.¹⁹ Individual clinicians and group practices can roughly gauge their costs of care for Medicare beneficiaries, compared with other practices, using CMS Quality Resource Utilization Reports. Local commercial insurers may be willing to share cost profiles with interested practices. Strategies to reduce costs may include shifting clinically appropriate patients to more cost-effective settings (especially important for academic practices that see the bulk of their patients in costly hospital outpatient departments), standardizing endoscopy supplies and devices, using anesthesia services more selectively, and preferentially prescribing generic drugs, among others.

6. Measure and demonstrate value. Despite the inherent limitations of performance measurement,²⁴ it is imperative that practices measure and report the value of care to their patients, community, and payers so that they are preferred partners and not locked out of insurance or referral networks. Improving patient experiences is intrinsically worthwhile²⁵ and also makes good business sense.²⁶

References

1. Miller, H.D. Creating payment systems to accelerate value-driven health care: Issues and options for policy reform. New York: The Commonwealth Fund, 2007.

2. Allen, J.I. The road ahead. Clin Gastroenterol Hepatol. 2012;10:692–6.

3. Allen, J.I. Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8.

4. Dorn, S.D., Vesy C.J. Medicare’s revaluation of gastrointestinal endoscopic procedures: Implications for academic and community-based practices. Clin Gastroenterol Hepatol. 2016 (in press).

5. Burwell, S.M. Setting value-based payment goals: HHS efforts to improve U.S. health care (N Engl J Med. 2015;372:897–9).

6. The Advisory Board Company. Commercial Bundled Payment Tracker, 2016.

7. Mechanic, R.E. Mandatory Medicare bundled payment – is it ready for prime time? N Engl J Med. 2015;373:1291–3.

8. The National Commission on Physician Payment Reform. Physician Payment Report, 2013.

9. Brill, J.V., Jain, R., Margolis, P.S., et al. A bundled payment framework for colonoscopy performed for colorectal cancer screening or surveillance. Gastroenterology. 2014;146:849–53, e9.

10. Evans, M. Few Medicare ACOs earned bonuses in 2014. Mod Healthc (2015). Available at: www.modernhealthcare.com/article/20150825/NEWS/150829922. Accessed Nov. 14, 2015.

11. Rau, J., Gold, J. Medicare yet to save money through heralded medical payment model. Kaiser Health News. Available at: http://khn.org/news/medicare-yet-to-save-money-through-heralded-medical-payment-model. Accessed Nov. 14, 2015.

12. Goldmsith, J., Kaufman, N. Pioneer ACOs: Anatomy of a victory. Health Affairs Blog, 2015.

13. Tu, T., Muhlestein, D., Kocot, S.L., et al. The impact of accountable care: Origins and future of accountable care organizations. Washington, D.C.: Brookings Institution, 2015.

14. NCQA. Patient-centered specialty practice frequently asked questions.

15. Xu, T., Wu, A.W., Makary, M.A. The potential hazards of hospital consolidation: Implications for quality, access, and price. JAMA. 2015;314:1337–8.

16. The Physician’s Foundation. 2014 survey of America’s physicians. Practice patterns & perspectives: The Physician’s Foundation.

17. Tsai, T.C., Jha, A.K. Hospital consolidation, competition, and quality: Is bigger necessarily better? JAMA. 2014;312:29–30.

18. Ginsburg, P.B. Fee-for-service will remain a feature of major payment reforms, requiring more changes in Medicare physician payment. Health Aff (Millwood). 2012;31:1977–83.

19. Friedberg, M.W., Chen, P.G., White, C., et al. Effects of health care payment models on physician practice in the United States. Santa Monica, Calif.: RAND Corp., 2015.

20. Greenberg, J.O., Barnett, M.L., Spinks, M.A., et al. The “medical neighborhood”: Integrating primary and specialty care for ambulatory patients. JAMA Intern Med. 2014;174:454–7.

21. Dorn, S.D. Mid-level providers in gastroenterology. Am J Gastroenterol. 2010;105:246–51.

22. Wasfy, J.H., Rao, S.K., Kalwani, N., et al. Longer term impact of cardiology e-consults. Am Heart J. 2016;173:86–93.

23. Coleman, K., Austin, B.T., Brach, C., et al. Evidence on the chronic care model in the new millennium. Health Aff (Millwood). 2009;28:75–85.

24. Dorn, S.D. Quality measurement in gastroenterology: confessions of a realist. Clin Gastroenterol Hepatol. 2016;14:648–50.

25. Berwick, D.M. Measuring physicians’ quality and performance: adrift on Lake Wobegon. JAMA. 2009;302:2485-6.

26. Browne, K., Roseman, D., Shaller, D., et al. Analysis & commentary. Measuring patient experience as a strategy for improving primary care. Health Aff (Millwood). 2010;29:921–5.

Dr. Dorn is vice chief, division of gastroenterology and hepatology, associate professor of medicine, health policy & management, University of North Carolina at Chapel Hill. He has received honoraria for consulting and presentations on health reform from AbbVie and Olympus.

The first article during my tenure as editor of the “Practice Management: The Road Ahead” section of Clinical Gastroenterology and Hepatology published in July 2012 (Clin Gastroenterol Hepatol. 2012;10:692-6) outlined anticipated changes in health care delivery, due in large part to mandates or trends contained in the Patient Protection and Affordable Care Act. A second article was published in 2013 (Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8). In this month’s column, Spencer D. Dorn, MD, MPH, MHA, of the University of North Carolina at Chapel Hill, adds a third update with an article focused on alternative payment models. These new reimbursement models are becoming common and will be part of all of our practice strategies in the years to come. No matter what occurs in the 2016 election, the movement from volume- to value-based payment will continue relentlessly, and practices that do not understand how to respond will struggle. We hope these articles will kick-start conversations in your practice.

Fee-for-service (FFS) reimbursement has been criticized for encouraging quantity over quality, favoring procedures over cognitive services, and fragmenting care.1 The landmark Patient Protection and Affordable Care Act (ACA) and more recent Medicare Access and Children’s Health Insurance Program Reauthorization Act (MACRA) modify Medicare’s FFS and encourage alternative payment models (APMs) that better reward value than volume.

Prior articles in this series have identified the specific trends driving gastroenterology practice strategies and business decisions,2 including an increasing need to demonstrate value, an emphasis on improved population health, an increasing number of practices becoming employees of large integrated delivery networks, reduced FFS reimbursements that are more closely linked to performance metrics, and increasing demands for risk-based contracts.3 In this article, I dive more deeply into these last two trends (declining FFS and the rise of APMs) and consider strategies gastroenterology practices can take in response.

Changes in fee for service

The ACA directed the secretary of Health and Human Services to establish a formal process to review potentially misvalued procedure codes. Compared with the pre-ACA fee schedule, the final 2016 Medicare Physician Fee Schedule includes cuts to professional fees for upper endoscopy, endoscopic retrograde cholangiopancreatography, endoscopic ultrasound, and colonoscopy. At the same time, over the past decade, facility fees paid for procedures performed in hospital outpatient departments have increased. Those to ambulatory surgery centers have gradually increased, although they still remain far below pre-2008 levels. Thus, the full economic impact of fee revaluation on an individual gastroenterology practice depends on whether it collects associated facility and ancillary fees.4

In addition, in the 2016 fee schedule, the Centers for Medicare & Medicaid Services described its intention to remove the value of moderate sedation from all gastrointestinal procedures. This is to prevent paying twice for sedation in procedures that involve anesthesiology professionals (i.e., one payment to the endoscopist as part of the overall procedure fee and a separate payment to the anesthesia professional for sedation they provide and bill for separately). The American Medical Association/Specialty Society Relative Value Scale Update Committee, using survey data from the GI specialty societies and other specialties that perform their own moderate sedation, has submitted recommendations for the value of a new set of moderate sedation Current Procedural Terminology codes to the CMS. The agency is expected to provide the specifics on how it will remove moderate sedation from the GI procedure codes in the 2017 Medicare Physician Fee Schedule Proposed Rule. The more that moderate sedation is valued, the less that endoscopic procedures will be valued. Consequently, gastroenterologists who rely on anesthesiology professionals to sedate their patients will generate less revenue per procedure, unless they rearrange contracts with anesthesia providers. Gastroenterologists who perform moderate sedation will not be impacted, because the sum of the value of the new moderate sedation code plus the underlying endoscopic procedure code will equal the original value of the procedure.

Beyond revaluing services, the CMS outlined its rather ambitious goal “to have 85% of all Medicare fee-for-service (FFS) payments tied to quality or value by 2016, and 90% by 2018.”5 Currently this includes the Physician Quality Reporting System (PQRS), which requires gastroenterologists to report performance on either three or more individual PQRS measures or one PQRS measures group (collection of related individual measures) or face a 2% Medicare payment penalty. It also includes the value-based payment modifier, through which by 2017 all practices with better-than-average quality (linked to PQRS measures) and lower costs will receive bonus payments, whereas those with worse-than-average performance (or who choose not to report) will be penalized.

MACRA changes all of this. Starting in 2019, the meaningful use incentive program, PQRS, and value-based payment modifier will be consolidated into the Merit-Based Incentive Payment System (MIPS). Physicians who elect to remain on an FFS tract will receive a 0-100 composite performance score based on quality (30%), resource use (30%), meaningful use (25%), and clinical practice improvement activities (15%). At the start of a performance period, a composite threshold necessary to achieve incentive payments and avoid penalties will be determined. Throughout the performance period, physicians will receive timely feedback on their performance. At year’s end, those below the threshold will face penalties proportionate to their performance (as much as 4% in 2019 and going up to 9% in 2022), those at threshold will not receive a payment adjustment, and those above threshold will receive bonuses proportionate to their performance (although overall payments will be capped at $500 million).

Alternative payment models

The CMS’s ultimate goal is to move beyond FFS and have “30% of Medicare payments tied to quality or value through APMs by the end of 2016 and 50% of payments by the end of 2018.”5 MACRA supports this ambitious goal: Starting in 2019, providers who “sufficiently” participate in APMs will receive 5% across-the-board bonuses. The three main APMs are bundled payments, accountable care organizations (ACOs), and patient-centered medical homes.

A bundled payment is a single fixed price paid to cover services for a specific episode of care. Depending on how an episode is defined, the bundle may encompass all professional fees, facility fees, and medical device and supply costs for a given service, including postacute care and any complications. If costs are reduced beyond the already discounted price of the bundle and quality metrics are achieved, then participants share the savings. Conversely, if costs exceed the bundled payment amount, then participants lose money. Unlike FFS, bundling incentivizes participants to coordinate care, reduce complications and unnecessary services, and cut purchasing costs.

To date, the CMS has launched three bundling programs. The Acute Care Episode Demonstration Project provided hospitals and clinicians a bundled payment to cover orthopedic and cardiovascular procedure–related episodes of care. This program reduced Medicare costs, primarily because the bundle payment was lower than what the sum of individual payments would have been. Providers were able to cope mainly by reducing their surgical implant costs. Second, more than 6,000 providers are currently participating in Medicare’s Bundled Payments for Care Improvement Program. The results of this program have not yet been released. Third, the CMS recently announced the Comprehensive Care for Joint Replacement Program under which hospitals and physicians in 67 metropolitan areas will be required to participate. Mandatory participation signals the CMS’s strong motivation to shift away from FFS. Beyond Medicare, many commercial insurers offer bundled payment programs, primarily for cardiovascular and orthopedic conditions.⁶ Although these programs are promising, it is technically challenging to define what is in a bundle, and to adequately risk adjust and mitigate random variation in spending for certain episodes of care. Providers are also challenged to find ways to divide payment among participants, coordinate all care, and accept financial risk.^7,8 The American Gastroenterological Association recently published a bundled payment framework for screening and surveillance colonoscopy.⁹ Bundling other gastroenterology services will be more challenging.

Whereas bundled-care programs focus on a discrete service (e.g., knee replacement or colonoscopy), ACOs are integrated groups of providers who jointly assume responsibility for the cost and quality of all care delivered to a defined population. The ACA requires ACOs to have formal legal, leadership, and management structures; care for at least 5,000 Medicare beneficiaries; fulfill certain patient-centeredness criteria; measure and report quality and cost data; and coordinate care. Different payment models incentivize ACOs to reduce costs and improve quality of care. ACOs operating under a one-sided shared savings model receive FFS payments for each service delivered, along with a bonus for reducing costs below a spending target and meeting quality requirements. There are no potential financial penalties. Alternatively, ACOs operating under a two-sided risk-savings model share a greater proportion of cost savings, in exchange for potential financial penalties if the cost of care exceeds target spending.

To date, Medicare-sponsored ACOs have produced mixed results. In 2014 only 92 of the 322 Medicare Shared Savings ACOs were able to reduce spending below a predetermined benchmark by a predetermined amount (2%-3%) while meeting quality scores, thereby earning a bonus ($341 million in total). Similarly, of the original 32 pioneer ACOs, which by definition are more experienced at managing population health and more willing to take on financial risk, 13 dropped out of the program, and in 2014, only 11 generated enough savings to earn a payout ($82 million in total), whereas 5 incurred financial penalties ($9 million in total) for costs exceeding target thresholds.¹⁰ In total, after paying out bonuses, the ACO program cost Medicare a net loss of nearly $3 million, far from the $10-$240 million Medicare had previously projected it would save through the ACO program.¹¹ Clearly, ACOs are not a quick fix for all that ails health care. For many ACOs, the major start-up requirements (time, capital investments, and so forth) needed to manage a population may not be worthwhile.¹² Nonetheless, the CMS recently launched the Next Generation ACO model through which 21 participating ACOs will assume higher levels of financial risk (possibly capitated payments) in exchange for greater potential rewards. Similarly, beyond Medicare, there are also many Medicaid-sponsored ACOs and hundreds of commercial payer-sponsored ACOs.¹³

Finally, practices can qualify for APM status without accepting bundled payments or joining an ACO by qualifying as a patient-centered medical home. One option for gastroenterologists and other specialists is the National Committee for Quality Assurance’s patient-centered specialty practice designation, available to practices that successfully demonstrate their ability to track and coordinate care with primary care providers and other specialists, offer timely appointments and responses to telephone and electronic messages, use evidence-based tools to manage care for specific patient populations, develop patient-centered care plans, and measure and improve performance.¹⁴

Consolidation

Health insurers are merging to increase scale (and negotiating power), enhance efficiency (reducing administrative costs makes more room for profits), and diversify their businesses. Recently proposed acquisitions will bring “the big five” health insurers to the “big three.” Likewise, health care systems are rapidly acquiring hospitals and physician groups, so much so that today half of all American health care markets are now considered highly concentrated, and none are considered highly competitive.¹⁵ Today only 35% of all physicians are independently employed.¹⁶ Physicians employed by health systems trade their complete autonomy to offset declining reimbursement, reduce operating expenses (including health information technology costs), improve work-life balance, and mitigate unknown risks.

Proponents contend that these mergers allow health care systems to better coordinate care, improve care experiences, accommodate new payment models, and assemble the building blocks needed to form ACOs and other integrated care models. Critics argue that locally dominant systems drive volume (by tightening referral relationships and gaining new market share) and increase costs (through enhanced negotiating leverage and by reclassifying newly acquired physician practices as part of the hospital, thereby generating facility fees). It is unclear whether consolidation results in better outcomes or simply increases overall costs.¹⁷

Strategic imperatives

What should gastroenterologists do? First, recognize that FFS is not going away anytime soon.¹⁸ Most APMs are still largely in their experimentation phase, and it remains unclear which models will work and which will be broadly adopted. Still, it is unrealistic to expect FFS to indefinitely persist as the dominant payment model. For some services FFS may no longer be a payment option (e.g., Medicare’s BCPI [Bundled Payments for Care Improvement]). For others, FFS rates may become so unattractive that APMs seem necessary. Finally, APMs may allow some practices to capture a greater proportion of overall clinical revenue (e.g., academic practices that perform endoscopic procedures within hospital outpatient departments) and to develop new models that meaningfully improve care. Today’s gastroenterology practices must therefore operate on two separate tracks: an FFS track that rewards volume (most practices are optimized for this) and an alternative payment track that rewards value (few practices can accommodate these on their own). The degree and speed with which practices should reorient to the alternative payment track depends on the type of practice and the specific local health care market. But even practices operating in slower-to-evolve markets should start preparing for the APMs, no matter how far off in the distance they may seem. I recommend the following six steps:

1. Integrate. To participate in APMs, preserve referral streams, and maintain negotiating leverage with health plans, independent, community-based practices may need to affiliate or merge with other physician groups, or align with or be acquired by a health care system.¹⁹ Academic practices are challenged to define their role within health care systems that are rapidly adding primary care practices, and often community gastroenterology practices, too.

2. Collaborate and communicate. To deliver high-value care to populations of patients, gastroenterologists must closely collaborate and clearly communicate with primary care physicians and other specialists. Collaborative care agreements can help guide these relationships.²⁰3. Develop new models of care. Patients with more routine GI and liver-related problems may be served more cost effectively by midlevel providers²¹ or innovative solutions, such as e-consultations.²² Patients with complex, chronic GI and liver diseases may be best served by multidisciplinary care teams (e.g., gastroenterologists alongside midlevel providers, nurses, care managers, psychologists, and/or pharmacists) who use clinical information systems to identify high-risk patients and to encourage evidence-based decision making, and who support patients to self-manage their own conditions.²³ Previously infeasible in a purely FFS world, these models are encouraged by APMs.

4. Care for common, costly conditions. Most gastroenterology practices have built robust colorectal cancer screening programs, sometimes at the expense of cognitive-based services. In today’s more accountable world, practices that can effectively manage common, costly conditions, such as inflammatory bowel disease, functional GI disorders, and advanced liver diseases, will be rewarded better than before and will be more highly sought as partners.

5. Understand and contain costs. The timely, accurate data needed to effectively respond to APMs are challenging to come by.¹⁹ Individual clinicians and group practices can roughly gauge their costs of care for Medicare beneficiaries, compared with other practices, using CMS Quality Resource Utilization Reports. Local commercial insurers may be willing to share cost profiles with interested practices. Strategies to reduce costs may include shifting clinically appropriate patients to more cost-effective settings (especially important for academic practices that see the bulk of their patients in costly hospital outpatient departments), standardizing endoscopy supplies and devices, using anesthesia services more selectively, and preferentially prescribing generic drugs, among others.

6. Measure and demonstrate value. Despite the inherent limitations of performance measurement,²⁴ it is imperative that practices measure and report the value of care to their patients, community, and payers so that they are preferred partners and not locked out of insurance or referral networks. Improving patient experiences is intrinsically worthwhile²⁵ and also makes good business sense.²⁶

References

1. Miller, H.D. Creating payment systems to accelerate value-driven health care: Issues and options for policy reform. New York: The Commonwealth Fund, 2007.

2. Allen, J.I. The road ahead. Clin Gastroenterol Hepatol. 2012;10:692–6.

3. Allen, J.I. Health care reform 3.0: The road gets bumpy. Clin Gastroenterol Hepatol. 2013;11:1527-8.

4. Dorn, S.D., Vesy C.J. Medicare’s revaluation of gastrointestinal endoscopic procedures: Implications for academic and community-based practices. Clin Gastroenterol Hepatol. 2016 (in press).

5. Burwell, S.M. Setting value-based payment goals: HHS efforts to improve U.S. health care (N Engl J Med. 2015;372:897–9).

6. The Advisory Board Company. Commercial Bundled Payment Tracker, 2016.

7. Mechanic, R.E. Mandatory Medicare bundled payment – is it ready for prime time? N Engl J Med. 2015;373:1291–3.

8. The National Commission on Physician Payment Reform. Physician Payment Report, 2013.

9. Brill, J.V., Jain, R., Margolis, P.S., et al. A bundled payment framework for colonoscopy performed for colorectal cancer screening or surveillance. Gastroenterology. 2014;146:849–53, e9.

10. Evans, M. Few Medicare ACOs earned bonuses in 2014. Mod Healthc (2015). Available at: www.modernhealthcare.com/article/20150825/NEWS/150829922. Accessed Nov. 14, 2015.

11. Rau, J., Gold, J. Medicare yet to save money through heralded medical payment model. Kaiser Health News. Available at: http://khn.org/news/medicare-yet-to-save-money-through-heralded-medical-payment-model. Accessed Nov. 14, 2015.

12. Goldmsith, J., Kaufman, N. Pioneer ACOs: Anatomy of a victory. Health Affairs Blog, 2015.

13. Tu, T., Muhlestein, D., Kocot, S.L., et al. The impact of accountable care: Origins and future of accountable care organizations. Washington, D.C.: Brookings Institution, 2015.

14. NCQA. Patient-centered specialty practice frequently asked questions.

15. Xu, T., Wu, A.W., Makary, M.A. The potential hazards of hospital consolidation: Implications for quality, access, and price. JAMA. 2015;314:1337–8.

16. The Physician’s Foundation. 2014 survey of America’s physicians. Practice patterns & perspectives: The Physician’s Foundation.

17. Tsai, T.C., Jha, A.K. Hospital consolidation, competition, and quality: Is bigger necessarily better? JAMA. 2014;312:29–30.

18. Ginsburg, P.B. Fee-for-service will remain a feature of major payment reforms, requiring more changes in Medicare physician payment. Health Aff (Millwood). 2012;31:1977–83.

19. Friedberg, M.W., Chen, P.G., White, C., et al. Effects of health care payment models on physician practice in the United States. Santa Monica, Calif.: RAND Corp., 2015.

20. Greenberg, J.O., Barnett, M.L., Spinks, M.A., et al. The “medical neighborhood”: Integrating primary and specialty care for ambulatory patients. JAMA Intern Med. 2014;174:454–7.

21. Dorn, S.D. Mid-level providers in gastroenterology. Am J Gastroenterol. 2010;105:246–51.

22. Wasfy, J.H., Rao, S.K., Kalwani, N., et al. Longer term impact of cardiology e-consults. Am Heart J. 2016;173:86–93.

23. Coleman, K., Austin, B.T., Brach, C., et al. Evidence on the chronic care model in the new millennium. Health Aff (Millwood). 2009;28:75–85.

24. Dorn, S.D. Quality measurement in gastroenterology: confessions of a realist. Clin Gastroenterol Hepatol. 2016;14:648–50.

25. Berwick, D.M. Measuring physicians’ quality and performance: adrift on Lake Wobegon. JAMA. 2009;302:2485-6.

26. Browne, K., Roseman, D., Shaller, D., et al. Analysis & commentary. Measuring patient experience as a strategy for improving primary care. Health Aff (Millwood). 2010;29:921–5.

Dr. Dorn is vice chief, division of gastroenterology and hepatology, associate professor of medicine, health policy & management, University of North Carolina at Chapel Hill. He has received honoraria for consulting and presentations on health reform from AbbVie and Olympus.