Physicians Look for Support to Implement New Payment Models

Physician practices looking to engage in new healthcare payment models reported they need help and guidance to further advance delivery reforms, according to a joint study from the RAND Corporation and the American Medical Association.

Physician practices looking to engage in new healthcare payment models reported they need help and guidance to further advance delivery reforms, according to a joint study from the RAND Corporation and the American Medical Association (AMA).

Respondents told the researchers that their own practices or others in their markets were changing their organizational models in response to new payment models emerging. However, since they expressed uncertainty about how they would perform in alternative payment programs, joining with a larger organization provided a sense of security, according to the report.

“We found that changing the payment system probably isn't enough to ensure that patient care will improve,” Mark W. Friedberg, MD, MPP, the study's lead author and a senior natural scientist at RAND, said in a statement. “For alternative payment methods to work best, medical practices also need support and guidance. It's the support that accompanies a new payment model, plus how well the model aligns with all of a practice's other incentives, that could determine whether it succeeds.”

Nearly all of the physicians, physician practice leaders, and market observers who participated in the survey described facing multiple simultaneous changes in payment programs and regulations, which caused tension because of the lack of alignment among the multitude of performance measures and payment incentives being deployed.

The researchers studied 34 physician practices in 6 markets to determine the effects of alternative healthcare payments models, which include episode-based and bundled payments, shared savings, pay-for-performance, capitation, and retainer-based practices.

“The AMA is committed to ensuring physicians in all specialties and practice sizes can participate successfully in new payment models that allow them to efficiently provide the best care to patients,” AMA President-elect Steven J. Stack, MD, said. “Progress toward the high goals of payment reform requires a clear path forward, and insights from the new AMA-RAND report will provide missing information on the real-world impact of payment reforms on busy physician practices that can help improve current and future alternative payment programs.”

Physicians and practice leaders encounter 3 general operational problems in new payment programs. These following issues limit the effectiveness of payment reform programs and reduce physicians’ enthusiasm: errors in data integrity and timeliness, performance measure specification, and patient attribution; concerns about the implementation of performance and risk-adjustment measures; the influence of uncontrollable game-changing events in shared savings and capitation programs, such as the introduction of high-cost specialty drugs.

The participating physicians, practice leaders, and market observers provided ways to potentially enhance physician practices’ abilities to respond to the combinations of alternative payment models they faced:

  • Physician practices need support and guidance to optimize the quantity and content of physician work under alternative payment models.
  • Addressing physicians’ concerns about the operational details of alternative payment models could improve their effectiveness.
  • To succeed in alternative payment models, physician practices need data and resources for data management and analysis.
  • Harmonizing key components of alternative payment models, especially performance measures, would help physician practices respond constructively.