Medicare Quality Incentives Could Transform US Health Care System

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The Physician Quality Reporting Initiative,under which Medicare will begin to pay physicians a 1.5% bonusincentive for reporting quality measures, "represents a significantstep toward public reporting and pay for performance," infectiousdisease physician Manoj Jain, a medical director for Medicare's qualityimprovement organizations in Tennessee and Georgia, writes in a New York Timesopinion piece. According to Jain, "Soon doctors will be paid accordingto quality and value," and performance will be publicly reported toallow patients to "choose the best doctors." Jain adds, "With doctors'reputations at stake, they will have an incentive to improve."

Jaincontinues, "Just as managed care swept the health system a decade agoand left its mark, so should this new policy," called value-basedpurchasing. However, "such an approach has several potential landmines. Doctors will have an incentive to treat the less ill patients,because the outcome is bound to be better," Jain writes. In addition,physicians "already fed up with the bureaucracy and paperwork ofMedicare may wash their hands of the program and refuse to see anyMedicare patients, just as vast numbers of baby boomers begin turning65 and entering the program," according to Jain. Jain concludes, "Howvalue-based purchasing will affect health care only time and humanbehavior will tell. But change is urgent for our misaligned health caresystem" (Jain, New York Times, 9/4).

Reprinted with permission from kaisernetwork.org. Youcan view the entire Kaiser DailyHealth Policy Report, search the archives, and sign up for email deliveryat kaisernetwork.org/email. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, afree service of The Henry J. Kaiser Family Foundation.

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