Financial Incentives and Physician Practice Participation in Medicare's Value-Based Reforms
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Published on: February 19, 2021
Adam A Markovitz1,2, Patricia P Ramsay3, Stephen M Shortell3
1Medical Scientist Training Program, University of Michigan Medical School, Ann Arbor, MI.
Objectives:
To evaluate whether greater experience and success with performance incentives among physician practices are related to increased participation in Medicare's voluntary value-based payment reforms.
Data Sources/Study Setting:
Publicly available data from Medicare's Physician Compare (n = 1,278; January 2012 to November 2013) and nationally representative physician practice data from the National Survey of Physician Organizations 3 (NSPO3; n = 907,538; 2013).
Study Design:
We used regression analysis to examine practice-level relationships between prior exposure to performance incentives and participation in key Medicare value-based payment reforms: accountable care organization (ACO) programs, the Physician Quality Reporting System ("Physician Compare"), and the Meaningful Use of Health Information Technology program ("Meaningful Use"). Prior experience and success with financial incentives were measured as (1) the percentage of practices' revenue from financial incentives for quality or efficiency; and (2) practices' exposure to public reporting of quality measures.
Data Collection/Extraction Methods:
We linked physician participation data from Medicare's Physician Compare to the NSPO3 survey.
Principal Findings:
There was wide variation in practices' exposure to performance incentives, with 64 percent exposed to financial incentives, 45 percent exposed to public reporting, and 2.2 percent of practice revenue coming from financial incentives. For each percentage-point increase in financial incentives, there was a 0.9 percentage-point increase in the probability of participating in ACOs (standard error [SE], 0.1, p < .001) and a 0.8 percentage-point increase in the probability of participating in Meaningful Use (SE, 0.1, p < .001), controlling for practice characteristics. Financial incentives were not associated with participation in Physician Compare. Among ACO participants, a 1 percentage-point increase in incentives was associated with a 0.7 percentage-point increase in the probability of being "very well" prepared to utilize cost and quality data (SE, 0.1, p < .001).
Conclusions:
Physicians organizations' prior experience and success with performance incentives were related to participation in Medicare ACO arrangements and participation in the meaningful use criteria but not to participation in Physician Compare. We conclude that Medicare must complement financial incentives with additional efforts to address the needs of practices with less experience with such incentives to promote value-based payment on a broader scale.
Insights
Physician practices experienced with performance incentives were more likely to join Medicare
Area of Science:
- Health Services Research
- Healthcare Policy
- Health Economics
Background:
- Medicare's voluntary value-based payment reforms aim to improve quality and efficiency.
- Physician practices vary in their experience with performance incentives and public reporting.
- Understanding factors influencing participation in these reforms is crucial for successful implementation.
Purpose of the Study:
- To evaluate the relationship between physician practices' prior experience with performance incentives and their participation in Medicare's value-based payment reforms.
- To determine if success with financial incentives influences engagement in reforms like Accountable Care Organizations (ACOs) and Meaningful Use.
- To investigate the association between incentive experience and participation in the Physician Quality Reporting System (Physician Compare).
Main Methods:
- Regression analysis was used to examine practice-level relationships.
- Data from Medicare's Physician Compare and the National Survey of Physician Organizations 3 (NSPO3) were utilized.
- Prior experience was measured by revenue from financial incentives and exposure to public quality reporting.
Main Results:
- Increased financial incentives were associated with higher participation in ACOs and Meaningful Use programs.
- Practices with greater incentive experience were better prepared to use cost and quality data.
- Financial incentives were not significantly associated with participation in Physician Compare.
Conclusions:
- Physician organizations' prior success with performance incentives correlates with participation in Medicare ACOs and Meaningful Use.
- Medicare needs to support practices with less incentive experience to broaden value-based payment adoption.
- Targeted strategies are necessary to encourage wider participation in value-based care models.
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