APG Report Calls for Major Reforms to Medicare, Medicare Advantage
America’s Physician Groups (APG) has issued a report with detailed recommendations for reform suggestions for the Center for Medicare & Medicaid Services, including moving fully in the direction of accountable care in traditional Medicare and incentivizing two-sided risk payment arrangements between Medicare Advantage plans and physician groups.
APG’s approximately 360 physician groups comprise 170,000 physicians, as well as thousands of other clinicians. Its report, “Medicare Done Right: Prescriptions For Success,” notes that as of 2025, 69 million Americans will qualify for Medicare, a number that will rise to as much as 82 million in 2033. Yet the report notes, “the high and growing prevalence of chronic disease and disability among older Americans portend considerable demands on the U.S. healthcare system, at a time of widespread provider shortages and growing challenges in accessing care.”
In addition, the report observes, “healthcare costs continue to rise faster than the growth in the nation’s economy,” with affordability challenges for both beneficiaries and the nation.
APG makes the following recommendations in its report:
Traditional Medicare
• The traditional Medicare program should move fully in the direction of accountable care, with beneficiaries drawn into alternative payment models by adding comprehensive dental, vision, and hearing benefits to these arrangements only.
• “Non-accountability penalties” could be imposed on health systems and physician practices that declined to participate in alternative payment models (APMs).
• Congress and CMS should revisit current methodologies for setting spending parameters for APMs to foster greater participation and make the models sustainable over time.
• Congress should restructure cost and quality incentives in traditional Medicare, move away from the Merit-Based Incentive Payment System, and add back a restructured Advanced APM bonus program that would link bonuses to the number of beneficiaries attributed to an APM.
• A limited set of site-neutral payment reforms should be put in place on a budget-neutral basis, aligning payment across all sites of care for 66 ambulatory procedures and increasing payment for 108 primarily hospital-based services.
Medicare Advantage
• For Medicare Advantage, policymakers should actively encourage and incentivize two-sided risk payment arrangements between MA plans and physician and other provider groups.
• New models of risk adjustment should be developed and tested that will better tie assessments of MA enrollees’ health conditions with funding that reflects realistic costs of care.
• Reforms to prior authorization (PA) should include speeding the move to electronic PA, standardizing PA criteria across plans and making them more transparent, requiring plans and providers to increase quality and timeliness of communications to patients, and incentivizing or requiring MA plans to adopt “gold card” programs for contracted providers.
• CMS should test new aspects of the Quality Bonus Program and seek input from stakeholders before adopting new measures; it should also focus on a relatively shorter list of measures and prioritize those that matter to MA enrollees and demonstrably improve their health. CMS should also refine the current methodology of calculating Star Ratings to ensure that all MA plans are included in comparisons and that scores are predictable and
transparent from year to year.
• CMS should conduct greater evaluation of the costs and value of supplemental benefits and publish the results transparently. These results should form the basis of decisions about continuing these benefits within MA and extending them into APMs in traditional Medicare.
APG argues that if these changes were adopted by CMS and Congress, and accountability increased throughout traditional Medicare and MA, beneficiaries would be healthier and Medicare would save money. For example, if the health outcomes obtained by APG groups operating in at-risk contracts in MA were shared by all enrollees in traditional Medicare, the savings could reach $22 billion annually, according to APG estimates.
“APG is especially well suited to put forth these recommendations, given our longstanding commitment to being held accountable for quality and costs in healthcare,” said Niyum Gandhi, Chair of the Board of Directors of APG and chief financial officer of Mass General Brigham, in a statement. “The expertise that APG members have developed in running accountable models in both traditional Medicare and MA means that we are uniquely positioned to comment credibly on challenges in both areas, and on the critical changes needed to deliver better outcomes for patients and affordability for taxpayers in a sustainable manner.”
