P4P demo pays off for Medicare, but not for most doctors involved

Federal officials say more physician practices could see bonuses from the project’s second and third years.

By David Glendinning, AMNews staff.

Ten large physician practices participating in one of the first Medicare pay-for-performance projects have proven that such programs lead to better performance, according to government officials. But only two practices were able to reduce costs enough to receive any additional pay.

Last month, the Centers for Medicare & Medicaid Services released first-year results from the Medicare Physician Group Practice Demonstration, which launched in April 2005. CMS asked 10 practices to implement care management improvements that would lead to higher quality of care. In return, the practices were eligible to receive as a bonus a portion of the money that they saved Medicare by improving patient care in a targeted group of Medicare enrollees.

CMS found that all of the participants were able to hit or exceed standards on at least seven out of the 10 clinical quality measures for the treatment of diabetes, the only condition targeted in the project’s first year. For the pilot’s second and third years, the agency is adding congestive heart failure, coronary artery disease and preventive care measures.

Two of the participants, Forsyth Medical Group in Winston-Salem, N.C., and St. John’s Health System in Springfield, Mo., were able to make the grade on all diabetes measures.

The physicians and other health professionals involved in the pilot saved Medicare money, in part, by reducing repeat office visits, hospitalizations and trips to emergency departments, federal officials said.
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