Senate Bill Includes Pay-for-Performance for Physicians

On Monday, October 24, the Senate Finance Committee is scheduled to mark up a budget reconciliation package that includes Pay-for-Performance (P4P) for physicians. The P4P proposal is the “Medicare Value Purchasing Act of 2005” (S. 1356) that would establish a two-phase implementation of paying providers bonuses for delivering high quality care to patients. In the first phase, providers’ reimbursement would be tied to reporting quality data in much the same way hospitals were required to do under the MMA. In the second phase, Medicare providers would voluntarily participate in “value-based purchasing,” under which a portion of their payments would be set aside to create a quality pool. These funds would be given to providers meeting quality standards or those making progress toward meeting them. This phase would begin in 2008 for physicians.

P4P payments would begin at 1 percent of Medicare payments for each provider group, rising to 2 percent within five years. CMS would be charged with developing the quality measures, working with a new quality organization established under the bill, health care providers, and other organizations.

The Practice Committee’s P4P Task Force has been working closely with CMS to develop appropriate quality measures for hematology and has recommended several hematology measures to the agency. CMS has stated that it is so committed to P4P that even if the Congress is unable to pass legislation this year, it plans to implement a national P4P demonstration. ASH will keep members apprised of developments as this moves forward.