Practice Expense Data Collection and Methodology: Phase II Final Report.

Area of Science:

• Health economics
• Healthcare policy
• Medical practice management

Background:

• Medicare allocates billions for practice expense (PE) based on 2006 Physician Practice Information (PPI) Survey data.
• Outdated data may lead to inaccurate PE payments, not reflecting current resource needs in healthcare.
• Significant economic and healthcare system changes since 2006 necessitate data updates.

Purpose of the Study:

• To evaluate methods for improving Medicare's PE rate-setting methodology.
• To explore strategies for updating the data informing PE rates.
• To address concerns regarding the accuracy of current PE payment calculations.

Main Methods:

• Analysis of survey-based approaches for PE data collection.
• Description of a lean model survey instrument.
• Consideration of inter-agency data collection partnerships.
• Review of stakeholder feedback from a June 2021 virtual town hall meeting.

Main Results:

• Survey-based approaches are identified as the optimal method for data collection.
• Advantages and disadvantages of different survey strategies were examined.
• Stakeholder input was gathered on PE data collection and rate-setting processes.

Conclusions:

• Updating PE rate-setting requires a comprehensive approach, considering various data collection and methodological improvements.
• Recommendations for near- and longer-term changes to the CMS PE system are provided.
• Continuous evaluation and adaptation of PE data and methods are crucial for accurate Medicare payments.