The latest edition of the New England Journal of Medicine was waiting for me in my mailbox yesterday when I dropped by the post office. I was delighted to see that it was the March 4th edition and I was happy to get it on time. The mail comes very irregularly these days. During December and early January, some of my New Yorkers arrived almost a month late as did some more important items. Our Post Master General appeared before a congressional committee this week and essentially said, “Get used to it. It may get worse.” But I digress.
I should confess that every week I get two copies of the NEJM. When I was CEO of Atrius Health we ordered the New England Journal for every physician. We also bought a few books like 1400 copies of John Toussaint’s On the Mend: Revolutionizing Healthcare to Save Lives and Transform the Industry. We distributed the books to anyone who said that they would read them. I had the thought that some books had a message or made a point that we should all hear and that there was worthwhile information in every edition of the NEJM. After I retired I assumed that my name would fall off the NEJM mailing list so I purchased my own subscription. It’s been seven years and I have tried to get the Journal to send me only the copy that I purchased, but both copies keep coming. It feels like a terrible waste, but I fear that if I cancel my subscription someday I will open the mailbox expecting to get my Journal and there will be nothing there because my name was finally removed from the Atrius distribution list. I usually leave the second copy at the post office with the hope that it will do somebody some good. My wife thinks that I have a few screws in my head that are loose. What she does not realize is that I don’t want to risk not seeing an article that is as good as the one that I began to read yesterday standing in front of my mailbox at the post office wearing my double mask.
The instant that I scanned the contents on the cover I saw some familiar names attached to the “Perspective” article entitled “Reform of Payment for Primary Care — From Evolution to Revolution” written by Allan H. Goroll, M.D., Ann C. Greiner, M.C.P., and Stephen C. Schoenbaum, M.D., M.P.H. I met Dr. Groroll through our mutual interests in primary care innovation and the advancement of the “medical home” coupled with the shared desire that the role of the primary care physician be given the centrality that it deserves. Dr. Schoenbaum was my JAR when I had my medical rotation at the Brigham as a third-year medical student. A few years later after he had spent some time at the CDC he was a senior resident when I was an intern, and then for years, we were colleagues at the Harvard Community Health Plan. I am sorry to say that I do not know Dr. Greiner, but I know that she travels in good company.
The authors begin their piece by stating “what is.” I have bolded what rings most true for me :
Reforming payment for primary care has been on policymakers’ agendas for well over a decade. The impetus derives from primary care’s foundational role in a high-value health system and from troubling declines in the financial viability of primary care practices. Recent surveys found that 20 to 40% of respondents from primary care practices were considering sale, permanent closure, or consolidation, with safety-net practices appearing especially vulnerable. Moreover, primary care’s share of total U.S. health expenditures continues to decrease. In this context, questions about how best to pay for primary care, how much to pay, and how rapidly change needs to be implemented have reemerged as urgent considerations.
Those words are polite and gloss over decades of “abuse” that have been experienced by generations of primary care providers. More than a dozen years ago I was flabbergasted to hear a highly esteemed surgeon who eventually became the CEO of an important healthcare organization say that he did not understand all of the focus on improving primary care. He went on to say that most of the patients he saw were quite capable of selecting for themselves the expert that they needed to see from the menu of specialists of his esteemed organization. The statement was made in a collaborative conference about healthcare reform in the period between the passage of “Romneycare” in 2006 and “Obamacare” in 2010. Years later I saw pictures of him hobnobbing with Donald Trump.
Perhaps it is an extreme example, but I think it is important to consider that historically not every healthcare professional with management responsibility has believed in the centrality of primary care. I love the phrase “res ipsa loquitur,” “the situation speaks for itself.” In my mind, the long sad abuse and misuse of primary care is no accident. The current situation speaks volumes about the many ways that primary care has been abused in the current “eat what you kill” world of healthcare finance. In part, it is the result of how primary care has been considered by many influential leaders from other specialties, some of whom share the bias that I heard from that esteemed surgeon in that meeting long ago.
Much of the abuse arises from the subtle disinterest and the veiled abuse that primary care receives from other specialties in important venues like the AMA’s RUC. If the RUC is a new term for you, click on the link. The RUC is the powerful committee within the AMA that sets the relative compensation levels for units of work, the RVUs, of the various specialties. Those values determine Medicare reimbursement. The rates paid by Medicare are proportionately inflated to form the negotiated levels of payment for each specialty from commercial insurance. Providers frequently discuss their commercial reimbursement in terms of a ratio to Medicare payment. Many systems are able to get more than twice the reimbursement from a commercial payer than what Medicare would pay for the same professional activity maintaining the bias against primary care that exists in the RUC. Hospitals and medical groups keep an eye on the ratio between their patients who have “public payers” compared with their employer-supported patients who are covered by “commercial payers.” They call that ration the “payer mix.” If your focus is financial success gained by doing a lot of heart, hip, and knee surgery and you see primary care as a feeder system of raw material for your factory, primary care is n
But there is more that you need to consider as we think about the finance of primary care, the care of the underserved populations, and what the pandemic has revealed about the unequal care this system produces. There are three primary care seats on the RUC, Internal Medicine, Family Medicine, and Pediatrics. The committee ratio between primary care and other specialties is about 10 to 1. Fee For Service is a problem not only because it drives overuse and misuse of medical resources, but it also drives an economic disadvantage for those who do the hardest work in healthcare, provide primary care, and especially those who try to provide care in disadvantaged communities where patients are often covered by “public payers.” Much of what a primary care practice needs to do to aid a person who is a victim of poverty and living in a zip code where the social determinants of health are substandard is not even billable. Is it any wonder that the hospitals and systems that primarily provide care for low-income or disadvantaged populations often have financial problems and have fewer expensive technologies to offer than do the famous systems that cater to more affluent populations?
Again, our authors demonstrate great restraint when they describe the impact of Fee-For-Service (FFS) reimbursement in a bimodal system of care. The bolding is my addition for emphasis:
Fee for service (FFS) persists as the predominant method of paying for primary care in the United States. This retrospective, piecemeal approach to payment leaves clinicians trapped in a volume-maximizing culture that leads to rushed visits, wasteful practices, and high rates of clinician burnout. FFS payment also stifles innovation in care delivery and undermines integration with behavioral health and community services. In 2015, the Medicare Payment Advisory Commission concluded that FFS fails to foster accessible, patient-centered, high-quality care. The Covid-19 pandemic has underscored and exacerbated these shortcomings by threatening primary care practices that are still dependent on FFS payment for face-to-face visits, as visit volume has plummeted. Temporary policies authorizing payment for telemedicine visits have staunched catastrophic losses and immediate shutdowns but haven’t changed the downward financial trajectory of primary care in the United States.
For many years now there have been strong objections to FFS compensation coming from healthcare policy experts. The injustices and the associated expense and maldistribution of resources have been obvious to them. The problem is that most policy experts don’t have political power and they are not the managers of the large well reimbursed medical systems that are the pride of the country. Many of these policy experts like the authors of this paper and others like Don Berwick have tried to make slow but steady changes translate into the evolution of a more effective and just system of finance. The need to shift gears and accelerate from this plodding path toward healthcare equity explains the comment in the title after the hyphen, “–From Evolution to Revolution.”
I see our slow pace in moving toward more equitable support of primary care as similar to the very slow pace of racial justice and the creation of economic equity for minorities and even the White poor. These problems have been discussed and appreciated for my entire lifetime. I was born in 1945 and Harry Truman was working without success on both problems since he assumed the presidency when President Roosevelt died in April of 1945. FDR was working on both problems before he died while thinking about what needed to be done as the country returned to normal after the war. That’s 75 years of healthcare and economic inequity being advanced one small social mutation at a time. Things move slowly when improvement threatens a comfortable status quo that is just fine for the controlling majority. What surprises me is that there is also often a reluctance for change in those for whom the current system doesn’t work, but it is what they know, and what they know is less frightening than a big transition that puts them at the foot of a steep learning curve. Changing payment methodologies will require that everyone share a vulnerability and a need to learn new skills.
If you are a regular reader of these notes you have read many times the words written in 1965 by Dr. Robert Ebert, then Dean of Harvard Medical School:
“The existing deficiencies in health care cannot be corrected simply by supplying more personnel, more facilities and more money. These problems can only be solved by organizing the personnel, facilities and financing into a conceptual framework and operating system that will provide optimally for the health needs of the population.”
That statement alone is a description of the change that Dr. Ebert knew in 1965 needed to happen. Let me decode it for you. First throwing more money at the status quo won’t help. Transformation, which includes a change in the organization of how we practice and how we are paid is necessary. The problem he was addressing was expensive care that excluded many Americans and was not a good experience for many who did have access to care. “Organizing the personnel, facilities, and financing into a conceptual framework and operating system” is a call for prepaid universal access to well-managed ambulatory care that is supported by the judicious use of specialty support. The authors of the paper in the NEJM this week are essentially saying again what Dr. Ebert was saying over fifty years ago, that we need to make the move now from “volume to value.” That is the revolution that I think the authors are calling for when they say “–From Evolution to Revolution.”
The current policy consensus calls for changes in payment structures to reimburse for services on the basis of value, not volume. In primary care, this change entails shifting from traditional, retrospective FFS payment for face-to-face evaluation-and-management encounters to prospective, comprehensive payment (capitation) for all aspects of primary care delivery. When prospective-payment levels are appropriately set and properly risk adjusted, practices can better field and match resources to meet patient needs. This approach gives clinicians the freedom to spend sufficient time with patients and encourages innovative care tailored to patient preferences. Having a set budget discourages unnecessary care.
Their solution is an apt description of the revolutionary organization of that Dr. Scheonbaum and I worked in at Harvard Community Health Plan back in the 70s and 80s. There will be transition problems even if their solution is accepted. They are calling for changes in practice that are a return to skills and a system of care that most clinicians who have graduated from medical school over the last twenty-five years have no real experience, and most older clinicians who did practice before the death of managed care in the late 90s had their experience in dysfunctional systems because the original ideas of the 70s had been undermined by aggressive market tactics of the majority of healthcare that did not want to move away from FFS.
To practice “on a budget” requires an infrastructure of supports that is foreign to most FFS practices and almost all hospitals. This infrastructure must be rebuilt for capitation to deliver a Triple Aim experience. It also requires leadership, the kind of dedicated leadership that understands the challenge and has the tools as John Toussaint described in another book, Management on the Mend: The Healthcare Executive Guide to System Transformation. The fellow who became an important CEO that I referenced from my past had no interest in change so it is not a surprise that his attitude was reflected in his organization’s vigorous embrace and defense of FFS practice and its very disinterested dabbling in the transformation to value-based finance. The authors do give current examples of systems that are trying to relearn the skills of case management and team-based care in a medical home environment. They make the suggestion that the transition will require extra resources to overcome these barriers of “adaptive change.” Here is what they say:
There are important barriers to more revolutionary payment reform for primary care. Besides the refusal of some payers to sufficiently invest in primary care — an essential requirement — there is an underappreciated “better the devil I know” attitude among many primary care physicians. Although exiting a “hamster wheel” practice environment sounds appealing, physicians remain concerned about the adequacy of capitated payments and the degree of practice transformation required to succeed under a capitated system.
Experience with capitation under managed care in the 1990s created a lingering distrust of payers and capitated payment systems. At that time, the capitated payment was typically little more than the reimbursement that clinicians would normally receive under FFS, paid out prospectively in per-member-per-month aliquots. There was no net investment to facilitate and sustain practice transformation, nor was there adequate risk adjustment or reward for improving quality and patient experience.
Wariness also stems from clinicians’ relative inexperience with the information technology, team-based multidisciplinary approaches to care, and practice-management processes needed to achieve desired outcomes associated with comprehensive payment contracts. Practices that have been certified as patient-centered medical homes are best suited to make this transition, but many clinicians — especially at smaller and less-resourced practices — remain skittish.
To provide the resources for adaptation to capitation they suggest that practices be “held harmless for losses against their capitation for the first year. I think that is a move in the right direction but in my experience, it will take direct grants, extensive external support of leadership as it learns “a new way of walking” and longer than a year, perhaps more than five, to develop the management and front line skills necessary to achieve the desired results from transformation. Maybe that is what they are implying when they talk about “net investment.” I am very delighted that they refer to the Triple Aim as the ultimate goal.
Holding practices financially harmless for the first year of care delivered under reformed payment systems and providing investment funds allows practices to develop the teams, technology, and practice-management processes necessary to succeed under a comprehensive payment contract that emphasizes the Triple Aim outcomes of lower cost, better population health, and better patient experience. Participation of all major payers isn’t sufficient without net investment. CMMI’s latest large-scale prospective primary care payment initiative (Primary Care First) includes all payers but seeks to be budget neutral from the start, which raises concern about the adequacy and availability of investment funding.
There are many mountains to climb if we are to escape from tedious evolution to a more timely and successful revolution.
Other important barriers to accelerating the shift to comprehensive payment include challenges regarding patient attribution, the robustness of risk adjustment (especially with regard to incorporating social determinants of health), and measures of accountability. These important details — along with strategies for properly titrating the degree of financial risk — require attention, but they should not be rate-limiting.
There is much work to do and it will be done against continuing resistance that can only be overcome by demonstrating that FFS payment will be going away soon, like it or not. Up to now the most effective strategy against value-based compensation or capitation is for leading organizations to appear to embrace pilots and then to allow them to fail or produce lackluster results. That is the process that is “evolutionary.” It’s a “go along weakly” or “appear to be interested” strategy with failure as an objective. My concerns aside, I am in total agreement with the author’s conclusion:
Evolutionary approaches to payment reform have paradoxically perpetuated FFS payment; they have delayed practice transformation and exposed primary care practices to financially fatal risk. A strategy of net investment, collaboration, and principal payer participation could accelerate implementation of comprehensive payment structures. Turning away from evolutionary approaches toward accelerated payment reform offers opportunities for rescuing primary care and resurrecting its promise as the foundation of a well-functioning U.S. health care delivery system.
One reader of last Friday’s note got the point that I was trying to make that change must come from within. He wrote:
Terrific piece, Gene — most especially your conclusion, that change must be driven from within.
The subject of the post was the Commonwealth Fund’s published report of over a year of deliberations by a panel of healthcare policy and practice experts that they had convened. The report is entitled Health Care Payment and Delivery System Reform: Six Policy Imperatives. The core message of Friday’s post applies here also so I will close with a repeat of that concluding message from Friday’s letter.
…The task force report is an excellent resource that gives an in-depth description of the challenges ahead and the outcomes we need, but I am not so sure that we will get to the desire to have…
Affordable, quality healthcare. For everyone.
…without recognizing the need for even greater change. That recognition must come from within healthcare. Healthcare will work better for everyone when healthcare makes healthcare for everyone its most important objective.
The revitalization of Primary Care and the achievement of the Triple Aim has been possible but resisted for more than a half-century. It’s past the time when the changes should have occurred. After all that has been written and experienced during the fifty years of healthcare for which I have personal experience, I am fearful that it will take even longer to overcome the structural and cultural resistance to better primary care. Better care has been possible for a long time. What is different now? I hope that the answer comes from the hearts of hundreds of thousands of healthcare professionals who are tired of working in a system that produces inequality at a high cost when it could be producing “Affordable, quality healthcare. For everyone.” For that to happen their will must be coupled with dedicated leadership and the resources necessary to build an adequate managed care infrastructure.
Note: I have used the picture in today’s header before. It is the only one I have of some of the members of the primary care team that I worked with back in 2008 when I moved from practice to management. The woman who is third from the right is Maxine Stanesa, PA. She was my practice partner for over twenty years.
