The White House announced ambitious plans earlier this week for Medicare to reward doctors for better quality care. (AP Photo/Molly Riley)
The Obama administration earlier this week announced a not-so radical idea: Medicare, the massive health-care program for seniors, should do a much better job of paying doctors and hospitals for quality, not quantity, when it comes to care. Instead of paying a flat fee for each service, the administration said by 2018 it wants half of Medicare payments to hospitals and care providers to be calculated based on whether patients see better results.
Because Medicare is such a huge part of overall health care spending, the hope is that these changes will trickle out to doctors offices and hospitals across the country, reshaping how everyone gets treated. And many of these same efforts are already under way in the private sector.
On its face, it sounds reasonable enough. Who doesn’t want to cut waste in America’s $2.9 trillion health-care system and improve the kind of care that patients get?
But actually determining the quality of this care is tough business.
The financial stakes are high for the health-care industry and patients. For example, hospitals can face as much as a 2 percent pay cut from Medicare this year if they have especially high rates of patients returning within 30 days being discharged. The tricky thing there is that higher readmission rates don’t necessarily indicate a hospital isn’t as good – there are other factors to consider, including where the hospital’s located and the mix of patients.
The number of ways that quality is measured is vast. By one count, 33 different care programs within Medicare used a combined 1,676 reporting measures last year, and about half of those measures were unique to just …read more