Spring 2010 issue of Horizons

INDUSTRY u PROFESSIONAL SERVICEs

Linking Payment to Quality Outcomes With the president aggressively pushing for health care reform, there may be some changes on how health care providers will be reimbursed for services. At press time, it is unclear what future health care changes lie ahead. While most Americans are monitoring the health care reform proposals from a consumer-based perspective, physicians need to view potential charges from the viewpoint of providers of health care services. Specifically, physicians need to be aware that Congress is moving at least a step closer to linking reimbursement for services to quality outcomes. By Ken L. Rubin, CPA, and Steve Moro, CPA

From a historical perspective, there has been a progressive move by Congress to link payment for physician services to quality outcomes over the last several years. In 2006, the Tax Relief and Health Care Act (TRHCA) initially authorized the Center for Medicare & Medicaid Services (CMS) to develop the Physician Quality Reporting Initiative (PQRI). Under this program, the CMS was authorized to pay financial incentives, which amount to 1.5 percent of total Medicare allowable charges for covered professional services, to eligible professionals who satisfactorily reported the designated quality indicators for 2007. However, the amount of the financial incentive was limited. In 2007, the Medicare, Medicaid, and SCHIP Extension Act (MMSEA) authorized CMS to establish alternative mechanisms to replace the claims-based reporting of PQRI quality data. MMSEA provisions required alternative reporting periods and alternative criteria for satisfactorily reporting quality data. While the 1.5 percent incentive remained, MMSEA removed the allowable cap on the amount of the incentive that was previously in place under TRHCA. Then, in 2008, the Medicare Improvements for Patient and Providers Act (MIPPA) of 2008 made the PQRI

49 u spring 2010 issue