Health

Want Healthcare for All? Ditch Fee-for-Service, Says Former CMS Chief

If the U.S. wants to give everyone access to healthcare, fee-for-service medicine has to go, Donald Berwick, MD, former president of the Institute for Healthcare Improvement, said at a webinar on value-based care sponsored by the Duke Margolis Center for Health Policy.

“We should move to global budgets as soon as possible,” Berwick said at Thursday’s event. “It will not happen in a fee-for-service environment; I just don’t believe it can. And so the more we get to funding organizations to give total care to populations, the better.”

Berwick, who served as acting administrator of the Centers for Medicare & Medicaid Services under President Obama, also had other suggestions for improving the healthcare system. “There should be continuous cost reduction — not [just] slowing the rate of rise. We should aim, I think, for 15% of GDP, as the healthcare goal, and any change that doesn’t put us on that trajectory, doesn’t reflect the best of us.” The U.S. currently spends about 18% of its GDP — $3.8 trillion — on healthcare.

“Waste needs to go,” he continued. “I think CMMI [the Center for Medicare & Medicaid Innovation] has a big role in sorting out and getting rid of waste as an ongoing goal of every change that it makes … We’ve got to move of course to social determinants of health and shifting resources to the most vulnerable, around the equity frontier. And we can’t have a demoralized workforce; there has to be attention to the effect of our changes on joy and work.”

Also, Berwick said, “the reliance on hospitals is one of the biggest mistakes in design we have — home is the hub. Anything CMMI can do to advance the shift of the center of care to home and community is good.”

When it comes to implementing value-based care, “we need to, I think, move very, very much faster than we currently are,” said Don Crane, CEO of America’s Physician Groups, an organization of doctors interested in moving from fee-for-service medicine to value-based care.

“There’s kind of a gun to our head. It may be a different kind of gun for different people. For many providers, that gun is the potential of sequesters and pay cuts and rationing and the like, to bring healthcare into some sort of semblance of affordability. For others, the gun might be the prospect or fear of a single-payer system, whether they’re good or bad for them,” he said.

“The other gun is basically just the sort of immorality of our society, allowing really avoidable illness and suffering to continue,” Crane added. “We’re better than that; we know better than that. We seem to not be satisfied with it, but we’re complacent about it, so those are the guns that cause me to think that we need to really double down on the pace of the value movement.”

CMMI director Liz Fowler, PhD, JD, said her agency will be focused for the short term on its Comprehensive Primary Care model, under which primary care practices can receive management fees and share in any savings generated by efficient, high-quality care of their Medicare patients.

“We have a lot of experience with primary care models. We started testing comprehensive primary care models back in 2012, with a 4-year multi-payer demonstration and nearly 500 participants in primary care practices,” she said. “The results were mixed, but we did learn a lot from that model.”

The agency then launched another model, Comprehensive Primary Care Plus, “in 2017 with lessons learned from the first iteration, and we had over 2,600 practices participating,” she continued. “So taking what we’ve learned over the years, we’re going to continue to work on the models; we are also looking at this Direct Contracting Model that allows participants to enter into a capitated payment arrangement, including for primary care services.”

Fowler emphasized the “need to move towards advanced primary care with, ideally, accountability for total cost of care, recognizing we’re on a trajectory and not everyone is ready. But if we really want to coordinate care for chronically ill and seriously ill patients … we need to get primary care right.”

Mara McDermott, vice president of McDermott+Consulting, a health industry consulting, policy, and lobbying company in Washington, D.C., urged CMMI not to waste any time: “The challenge for CMMI right now is that coming out of the pandemic, there are a large number of different provider organizations … who are hungry to dive into these models,” she said. “I worry a little bit that we’re going to miss this opportunity where we have a very fired up and engaged set of providers who want to jump into the value movement,” but don’t know how to go about it.

  • Joyce Frieden oversees MedPage Today’s Washington coverage, including stories about Congress, the White House, the Supreme Court, healthcare trade associations, and federal agencies. She has 35 years of experience covering health policy. Follow

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