Medicare project pays doctors for saving money

By Larry Wheeler, Gannett News Service

Doctors participating in a new Medicare experiment appear to have done the impossible — delivering better care and saving money at the same time.

Using electronic health records and other innovations, physicians at 10 large group practices helped thousands of patients with chronic conditions such as diabetes take better care of themselves and, for some, avoid costly emergency-room visits and hospitalizations.

Their success is part of a four-year pilot program that tests whether an approach called “pay for performance” can slow the growth of the cash-hungry Medicare program while providing elderly and disabled patients with comprehensive, coordinated care they currently don’t get.

As part of the pilot project, which ends in March 2009, physician practices get an annual bonus if they save at least 2% over what Medicare would have spent on patients outside the project.

In 2006, its first year, the project saved Medicare an estimated $9.5 million. Thousands of patients benefited from increased contact with nurses, case managers and others.

“We saved Medicare over $1 million,” said Fred Bloom, a physician and director of quality and performance improvement for Geisinger Health System. The network of physicians, hospitals and community practice sites provide care for residents of rural central Pennsylvania.

Mason Samsel, 82, is one of 26,000 Medicare patients receiving treatment from Geisinger as part of the pilot project. Samsel met goals for blood sugar, blood pressure and cholesterol levels. He also received diabetic eye and foot exams and vaccines for flu and pneumonia.

“I get good care,” said Samsel, a retired car salesman who lives in Berwick, Pa. “When I get through with an appointment they schedule me at that time for three months later … and if there’s anything that comes up in between, call, and I’m in here very quick.”

Only two of the 10 group practices participating in the pilot project beat the savings target required to get a financial bonus during the project’s first year.

Those practices — Marshfield Clinic in central Wisconsin and the University of Michigan Faculty Group Practice in Ann Arbor — shared $7.3 million in performance payments.

Marshfield’s comprehensive electronic medical record system played a key role in the clinic’s success in treating 42,000 Medicare patients for diabetes, according to Dr. Theodore Praxel, Marshfield’s quality improvement director.

“When I see a patient, I walk in with a wireless tablet computer that has built-in preventive service reminders and prompts,” said Praxel. “So at the point of care, the physician has a reminder of what preventive services and what immunizations a patient might need.”

Five thousand doctors and 224,000 patients in 10 states are participating in the Medicare pilot project. The project focuses on patients with chronic conditions such as diabetes, hypertension, congestive heart failure and coronary artery disease.

One in five Medicare patients has five or more chronic conditions, and those patients account for more than two-thirds of annual Medicare spending. Every year, they typically see 14 different physicians and make almost 40 office visits, according to a study by Partnership for Solutions, a health care improvement initiative led by Johns Hopkins University and the Robert Wood Johnson Foundation.

Novant Medical Group in North Carolina didn’t get a financial bonus, but patients still benefited, said Nan Holland, senior director for clinical services and disease management.

Emergency room visits declined 48% and hospital admissions were down 30% among a target group of 122 individuals with multiple chronic conditions, including diabetes and heart problems, Holland said.

That’s good for patients and the Medicare system, she said.

Novant hired a manager and two case management navigators to assist patients and medical staff in reaching the 10 diabetic care benchmarks. The group also assigned a pharmacist to call patients to help them understand their prescriptions.

“Patients love the contact,” said Holland.

It’s too soon to tell whether Medicare’s experiment can solve the health insurance program’s financial crisis, government officials said.

“These 10 large physician group practices have done an excellent job of improving quality and cost effectiveness,” said Mark Wynn, Medicare’s director of payment policy demonstrations. “Part of our challenge is how can we apply these lessons more widely to smaller physician groups and individual physician practices. That’s a substantial challenge.”
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