Pay-for-performance should be pay-for-quality-care

AMA Leader Commentary. By Duane M. Cady, MD, Aug. 1, 2005.

AMA LEADER COMMENTARY

A few words about current events in medical practice

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A message to all physicians from the chair of the AMA Board of Trustees, Duane M. Cady, MD.

Often overlooked in discussions of pay-for-performance plans and Medicare's sustainable growth rate is a single common-sense question: What's in it for my patients?

The AMA House of Delegates adopted the principles and guidelines developed earlier by a specially approved AMA Board/Council Task Force on Pay-for-Performance. Their emphasis was on creating incentives for physicians to improve and maintain quality patient care -- and not at the cost of harming the patient-physician relationship.

Why?

There is no debating the rightness of the position. What needs to be underscored is the logic, the commitment of America's doctors to the well-being of their patients.

Since its founding in 1847, the AMA has championed both quality of care and the patient-physician relationship. At no time have physicians compromised quality and patient benefit.

All the discussion and debate over the sustainable growth rate takes place in front of that same background of ideas. The 40-year history of Medicare demonstrates a commitment by our nation to ensuring that seniors won't be forced to choose between paying for food and paying for medical care. The recently adopted prescription drug benefit is the most recent evidence of that philosophy.

The costs of care, on the other hand, have brought Medicare to the point of crisis. The 2005 Medicare Trustees Report projects physician payment cuts of 26% over six years beginning Jan. 1, 2006, because of the flawed SGR formula that dictates physician payments. What's more, the Board of Trustees report notes continued increases in physician costs of running a practice and caring for patients. Since 2002, physicians have received less than half the amount the government says it costs to provide care.

The only option any business faces when costs increase and revenues decline is to reform, reorganize, retrench and focus on the profitable parts of the business while eliminating the money-losing parts.