MedPAC Meeting Highlights

The Medicare Payment Advisory Commission (MedPAC) held a public meeting last week and had a full plate of a variety of topics from Accountable Care Organizations (ACOs) to Medicare Part B drug payment issues.

Some takeaways:

– The Woes with ACOs: MedPAC found that in 2015, the Centers for Medicare & Medicaid Services (CMS) paid Medicare Shared Savings Program (MSSP) providers $625 million. This means that after paying out $429 to providers who generated enough for savings, the agency lost money. One commissioner recommended MedPAC look into organizations that generated savings for CMS in order to better gauge which factors make an ACO succeed. Though true that ACOs are slow to show the progress everyone is hoping for, it is important to note organizations that have been in the program longer are showing more success.

– Quality Measurement: MedPAC once again discussed the possibility of a premium support system to be implemented for Medicare. The conversation focused heavily on the commission’s alternative concept for measuring quality in Medicare as well as finding quality measures that can be used across Medicare Advantage (MA), ACOs, and Fee-for-Service (FFS). MedPAC is becoming increasingly concerned the current quality program relies on too many clinical process measures that do not strongly correlate with health outcomes. Under MedPAC’s proposal, Medicare would use a small set of population-based outcome measures and patient experience to compare quality of care under each of the three payment models in a local area. This was the first of many conversations MedPAC will have on this topic over the next year.

– Imminent Move toward Biosimilars: MedPAC seemed to offer much support in moving forward with the greater use of biosimilars under Part D. The use of biosimilars in Medicare would likely lead to drastic drug program savings, especially for chronic conditions such as diabetes. Solutions thrown around included extending the coverage gap discount to include biosimilars, something that is currently only applied to brand name drugs.

– Part B Drug Payment Policies: Given that Part B drug spending has grown at an average rate of more than 8 percent per year over the lastfive years, the commissioners ran through several proposals on how to address this growth and tackle Part B payments. Options considered included increasing price competition, consolidating billing codes, limiting average sales price (ASP) inflation, modifying the payment formula, improving data, and restructuring the competitive acquisition program (CAP). The discussion did not end with any recommendations other than to continue to work on this matter. Of course, we are all anxiously awaiting CMS’ response to the flood of comments to its Part B Drug Payment Proposal.

– Behavioral Health: It was also suggested MedPAC explore policy solutions to the weaknesses in behavioral health services under Medicare. The commission discussed exploring both weaknesses in inpatient facilities for serious mental health issues as well as care in ambulatory settings. Solutions thrown around included integrating primary care with behavioral health specialists and examining readmissions and emergency room data to determine what kind of readmission measures and penalties could be used to drive better inpatient performance.