Current Payment Challenges and New

Payment Models

Jonathan L. Myles, MDChair, Economic Affairs Committee

Current Payment Challenges and New Payment Models

May 7, 2012

Session Objectives

• Discuss macro and micro payment policy pressures on physicians and pathologists specifically

• Examine CAP efforts exploring new payment options

• Identify federal and state economic payment policy initiatives

Payment Threat for Physicians

• AMA working to prevent looming payment cutsoCAP, other groups reinforce

AMA efforts

• Thanks to AMA for preventing 2012 SGR cuts

• Working to prevent further cutsoSGR – 2013oIPAB – 2014 and beyond

Revaluation of AP Services

• Congress increased Medicare’s authority to review services

• Stems from concerns that specialists are overpaid and primary care is undervaluedoPrimary care built case for increasesoShifting of funds results in budget

neutral environment • CAP is engaged in strategy to best

protect pathology services• Review is underway with CMS

implementation starting in 2013

TC “Grandfather”

• Congress discontinued TC Grandfather effective July 1

• Argument on double payment accepted by Congress

• CAP supports permanent extension to preserve access in rural and small hospital settings

• Congress not expected to revisit in 2012

Self-Referral: Close the Loophole

• Competition from other physicians creates economic strain on pathology practices

• Georgetown study demonstrates financial incentives increased utilization with lower cancer detection

• Self-referral results in increased use, increased costs, with little to no patient benefit

• CAP’s message to CMS, MedPAC and Congress: Close the loophole

Direct Billing for Pathology Services

• CAP and State Societies together deter use of pathology as a profit center

• Successfully enacted direct billing in 15 states since 2003

• Latest successes: Colorado, Washington and Indiana

• States in the pipeline: Illinois

• Over $1.3 million spent since 2003oCAP - $632,252oState Pathology Societies - $691,500

Exploring New Payment Options

• Case for Change: Better position specialty given economic pressures on pathologists and changing payment models

• Effort identified priority services based on impact and payment potential

• Areas examined:oEstimated market sizeoPayment potential/feasibilityoValue to pathologyoEase of implementation

Exploring New Payment Options

• Three themes emerged in review:1. Genomics is important going

forward2. New technologies provide

opportunities to bring pathologists closer to patient

3. Getting “closer to the patient” will be important for pathologists in the changing landscape

Exploring New Payment Options

• Services prioritized across two scenarios based on paymentoFee for service environmentoCoordinated care environment

• New services related to policy on ACOs, personalized medicine and health information technology

• Additional speakers will explore opportunities in these areas

Exploring New Payment Options

• Actions to advance adoption were reviewed for identified prioritized services

• Example – In Vivo MicroscopyoIdentified Action - enable

payment through code development and valuation

oAdvocacy efforts−Securing unique pathology code

−Valuation activities planned

How You Can Help

• Tell Congress to:oRepeal the SGR to ensure

stable payment systemoRemove the in-office exception

to the Stark self-referral law

• Cecil B. Wilson, MD, Immediate Past President, American Medical Association

• Jonathan L. Myles, MD, FCAP, Chair, Economic Affairs Committee

Panel Discussion