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LIVE from the MGMA Annual Conference: Is Medicare Reimbursement Uncertainty Inhibiting Advances Among Medical Groups?

October 22, 2012
by Mark Hagland
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MGMA senior executives say that policy and reimbursement uncertainty is keeping them from innovating

Even with greater policy certainty created by the Supreme Court’s affirmation of the constitutionality of the Affordable Care Act (ACA) this summer, physician group leaders say that the financial instability created by the reliance on a decade of temporary, last-minute congressional reprieves from Medicare sustainable growth rate (SGR) payment cuts is inhibiting their willingness to develop new care delivery and reimbursement models and to invest in staffing, clinical equipment and facilities.

Such was the overwhelming sentiment expressed by 1,000 physician group executives in response to questions in a survey executed by the Englewood, Colo.-based Medical Group Management Association (MGMA). The results of that survey were announced during a press briefing on Monday, Oct. 22, during the MGMA Annual Conference, being held this week at the Henry B. Gonzalez Convention Center in downtown San Antonio, Tex.

Following opening remarks by Susan Turney, M.D., MGMA’s president and CEO, and by Todd Evanson, the association’s director of data solutions, Anders Gilberg, senior vice president of government affairs at MGMA, cited “instability and uncertainty over potential future cuts, plus the Budget Control Act cuts, and potential sequestration” (the result of a deal reached in Congress several months ago during a budget impasse), and, above all, physician payment cuts resulting from the potential inability of leaders in the U.S. Congress to reach a long-term solution to the SGR problem, as major inhibitors for medical group leaders to innovate on care delivery and reimbursement models, or even maintaining the status quo.

Indeed, many respondents cited reimbursement uncertainty as having already forced them to reduce clinical staff, delay purchases of equipment or facilities, and cut back on charity care. Though the survey did not ask group practice executives specifically about investment in electronic health records, the responses of medical group executives clearly implied a difficult environment, financially speaking, for investment in clinical and other information systems.

Most importantly, 82 percent of those surveyed by MGMA said that they would be interested in pursuing such innovative arrangements as accountable care organizations and patient-centered medical homes, if only they could see greater policy and reimbursement certainty. Not surprisingly, given their feelings about the current payment environment, only 18 percent are currently involved in such innovative efforts.

The current reality, though, is that many are hanging back; indeed, the three top barriers survey respondents cited with regard to their not participating in such initiatives were, in order, the lack of payment predictability due to the looming 27-percent physician payment cut under Medicare if another SGR patch is not enacted by Congress; the programs offered aren’t “relevant or accessible” to particular medical groups; and program regulations are too onerous (presumably particularly with regard to accountable care organization requirements).

Instead, 60 percent of those surveyed by MGMA have delayed the purchase of new clinical equipment and/or facilities in the past year; 36 percent have reduced clinical staff; and only 18 percent are participating in one or more of Medicare’s new payment models and/or demonstration projects at present.
In short, Gilberg told members of the media Wednesday, “You have the specter of SGR hanging over everybody’s head.”


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