Payment & Delivery Models

How doctors are developing new payment models for their specialties

Troy Parks , News Writer

New regulations under the Medicare Access and CHIP Reauthorization Act (MACRA) are on their way, and physicians will have a choice to participate in the new Merit-based Incentive Payment System or alternative payment models (APM). It’s important that physicians are involved and leading the way now in the design of APMs to ensure they work for both their patients and their practices. Learn how one physician got involved with his specialty society to develop new payment models.

As a radiation oncologist in Seattle, Shilpen Patel, MD, saw opportunity in the APM option and began working with his specialty society, the American Society for Radiation Oncology (ASTRO), early. “It’s interesting to figure out how to navigate this because we’re all learning together,” he said.

Dr. Patel sits as vice-chair of the payment reform workgroup at ASTRO, which is comprised of 19 members who practice at freestanding community-based and academic medical centers. ASTRO is also represented in the AMA’s MACRA APM Workgroup. Dr. Patel presented his organization’s work to the AMA Council on Medical Service last November.

“One of the things I like about our group is that it’s a bunch of working physicians who see patients every day, and we’re all kind of in the trenches,” Dr. Patel said. “We have a pretty wide variation in terms of different practices represented to make sure that this is going to work for everybody at the end of the day.”

“We have the ability to set the agenda,” Dr. Patel said. “A lot of times people say, ‘Well, we’re just going to wait for something to happen and then react to it.’ Engaging the staff of your specialty societies is key because physicians can’t do these things by themselves.”

What’s important is that “physicians are leading the way,” he said. “We are approaching the insurance companies, saying let’s come up with a solution.”

Dr. Patel and his colleagues have been working to develop APMs that will be applicable to a wide range of physicians.

“Flexibility is important as we get these models through implementation,” he said. “We want this to be applicable to lots of different practices, whether you’re in academics or if you’re in a solo practice and everything in between.”

Here are two payment models from the payment reform workgroup at ASTRO:

Palliative treatment for bone metastases

Bone metastases were a good place to start because it covers all cancers that spread to the bones, Dr. Patel said. “With that alternative payment model, the main thing was to demonstrate that radiation therapy was this alternative to debilitating narcotics.” Avoidance of those narcotics can help improve a patient’s quality of life, he said.        

Shared decision-making was an important piece of this model, Dr. Patel said. “Physicians and patients should be able to decide the most appropriate treatment, between the two of them.”                  

“It was a focused model in terms of really defining and establishing an episode of care for which there were some evidence-based practices and determining what’s appropriate from the radiation side of things,” Dr. Patel said. “The goals are quality and appropriate utilization—which encompasses not only overutilization but also underutilization—to make sure patients get the most appropriate therapy.”        

“We know that a large fraction of the dollars spent on patients is in the last six months of their life,” Dr. Patel said. “This model applies to lots of different cancers, so it is far reaching and somewhere where we could make a big difference.

Breast cancer treatment

Dr. Patel and his colleagues then set out to address specific cancers and establish appropriate models for each. “We chose breast [cancer] because it is the most common in women, and there are discrete episodes of care,” he said. Each episode “can help improve quality and make sure patients are still getting choices in their treatment while also getting the most appropriate and up-to-date treatment.”              

“We established a base rate using a weighted average of fee-for-service payments of four different modalities that were suitable for early stage breast cancers,” he said. “By doing this, we have a level set for a cost of care across various modalities.”        

“Ultimately our goal is to incentivize the use of the most appropriate treatment for patients and preserve some flexibility as well in terms of treatment options,” Dr. Patel said.

If you want to get involved with your specialty society, Dr. Patel has some advice. “When physicians are trying to take some leadership roles in this, they need to know that it’s a work in progress and we’re in it for the long haul,” he said.

“Do a little bit of research in terms of variation in care, cost, value and quality,” Dr. Patel said. “All of those things are relatively easy to prove when we look at the way people practice. Then provide that data to your society.”

“It’s easy to look at large population [data] using your databases or Medicare’s databases to prove that not everybody is getting the same level of care,” he said. “And the specialty societies need to lead on that.”

The AMA worked closely with Harold Miller, president of the Center for Healthcare Quality and Payment Reform, to develop the “Guide to Physician-focused Alternative Payment Models.” The guide describes seven different types of physician-focused APMs that address opportunities to improve care and help physicians overcome payment barriers. Although different specialties are working on models for the patients and conditions that they manage, they are also working together with the AMA to advocate for more physician-focused APMs.

“If we’re not all going to propose APMs, we all need to at least have an understanding,” he said, “before we get caught with insurance companies saying this is the way it’s going to be.”