Last month the Senate Finance Committee called for stakeholders to provide recommendations to replace the Sustainable Growth Rate (SGR) formula, and last week the American College of Physicians weighed in with 19 proposals.

In a 20-page letter to the Senate Finance Committee, ACP President Molly Cooke outlined methods “to provide stability for physician reimbursement and lay the necessary foundation for a performance-based payment system,” according an ACP press release.

Among the ACP recommendations:

Supplement the recommendations by RUC with other data sources, with emphasis on the word “supplement.” The objective should not be to “replace the excellent work being done by the American Medical Association/Specialty Society Relative Value Scale Update Committee (RUC) to provide CMS with expert advice on improving RVU accuracy,” the letter states. “We note that RUC has, on its own, made major improvements in its representation and processes, including adding new primary care and geriatric seats and disclosing the aggregate votes on RVU recommendations.” The ACP does recommend that CMS appoint an independent panel to review RUC recommendations. Other data sources should include independent researchers, particularly those who study “clinician work time, service volume, and practice expenses.”

Identify and reduce payment for overpriced services. Using the data review process mentioned above, federal officials should make reductions to those areas identified as “overpriced.” After that the government should set a target, suggested at 1 percent per year, for further annual reductions. “ACP strongly recommends that these adjustments be redistributed back into the overall RVU pool and specifically re-allocated to E/M codes without regard to the specialty of the physician who is billing the E/M code (with the exception of those E/M codes included within global surgical periods),” the letter states in boldface type.

Pay for services that facilitate care coordination and promote patient-centered care. This emerging trend in Medicare, most recently demonstrated by the implementation of transitional care management (TCM) codes, must be encouraged and expanded throughout all of Medicare, the letter states. The savings per patient that will result from having greater coordinated care should be plowed back into E/M codes.

Eliminate provider-based billing. Payment for services should be the same, regardless of where the service is provided, the ACP writes.

The ACP offered several recommendations to control federal spending for healthcare services. Most of its suggestions centered around transparency of cost data which should be employed by patients and physicians, not only among themselves but with their peer groups. The ACP asked the committee to eschew requiring prior authorization before performing services for patient, which is a typical method for preventing abuse by physicians.

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