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'High-value' physicians could save more than $286 billion in Medicare costs, says UnitedHealth Group

The savings for Medicare fee-for-service would vary by specialty, but would total more than $20 billion next year alone.

Jeff Lagasse, Editor

Healthcare spending in the U.S. is expected to nearly double between 2017 and 2027, but there are a few areas where major savings are achievable -- avoiding emergency department visits, rising hospital prices and the high cost of specialty drugs among them.

Another is to promote care delivery by what UnitedHealth Group calls "high-value" physicians, and they're the subject of the group's latest report.

So what is a high-value physician, exactly? As defined in the research, a physician becomes high-value if they meet quality criteria in their care for Medicare fee-for-service patients, but also meet cost-efficiency criteria in the future.

If that were to happen, the savings for Medicare fee-for-service would be $20.5 billion in 2020 alone. From 2020-2029, they could save an estimated $286.8 billion, representing a 4% savings in total Medicare fee-for-service spending, according to UnitedHealth Group.

WHAT'S THE IMPACT

High-value physicians meet the quality and cost-efficiency criteria established by the UnitedHealth Premium Program. The program draws upon quality metrics from the National Quality Forum, the National Committee for Quality Assurance and other clinical quality organizations. Cost-efficiency measures are based on local market benchmarks for cost-efficient use of resources and referral patterns in providing care.

Both quality and cost-efficiency benchmarks are set annually and all physicians in UnitedHealthcare's provider networks are evaluated against them each year. High-value physicians are designated as Premium Care physicians by UnitedHealthcare, the insurance arm of UnitedHealth Group. High-value physicians have higher rates of compliance with evidence-based medicine and lower rates of complications and revisions than other physicians.

In other words, high-value physicians achieve better outcomes for patients at lower costs. If all U.S. physicians caring for Medicare fee-for-service patients who meet quality criteria were to become high-value physicians by meeting the cost-efficiency criteria, the Medicare program would achieve the savings outlined above, and in the process, seniors would realize savings through lower premiums and out-of-pocket costs, the report found.

The difference in per-patient or per-episode cost between high-value physicians and other physicians varies by specialty. Primary care physicians represent the greatest total savings opportunity. If primary care physicians caring for Medicare fee-for-service patients who meet quality criteria were to become high-value physicians by meeting the cost-efficiency criteria, the Medicare program would save $14.5 billion in 2020 and $202.9 billion between 2020 and 2029.

Improving the cost-efficiency of cardiologists, neurologists and pulmonologists who already meet the quality criteria for high-value physicians could save seniors and the Medicare fee-for-service program $4.3 billion in 2020 and $61.2 billion over 10 years.

THE LARGER TREND

According to a January MGMA Stat Poll, healthcare organizations are struggling with the ever-widening gap between reimbursements and cost of care.

Participants were asked whether their practices' 2019 Medicare payment rates were above, equal to or below the cost of delivering care. More than two-thirds of medical practices reported that 2019 Medicare payments will not cover the cost of delivering care to beneficiaries. Those whose rates were equal to or above cost were almost even at 17 and 16 percent respectively.

According to MGMA, one respondent among the 67 percent whose payment rates were below the cost of care wrote that the Medicare "population is more complex, more sickly, and has comorbidities that you don't see elsewhere. It takes more resources to manage their conditions."
 

Twitter: @JELagasse

Email the writer: jeff.lagasse@himssmedia.com