Study: P.E. Acquisition Linked to Lower MIPS Scores for Urologists

Oct. 23, 2023
For urologists at acquired practices, MIPS scores decreased significantly in the year after private equity acquisition, according to a study in Urology Practice

Urology practices that have been acquired by private equity firms show significant reductions in scores on Medicare's Merit-Based Incentive Payment System (MIPS), according to research published in the November issue of Urology Practice, a journal of the American Urological Association.

Decreases in MIPS quality scores are accompanied by reductions in incentive bonus payments to urologists at acquired practices, according to the new research by Kassem Faraj, M.D., of the University of Michigan and colleagues.

In urology and other specialties, there is a trend toward increased acquisition of medical practices by private equity firms. "Private equity aims to strategically increase the value of a practice by reducing costs or expanding revenue, with the goal of selling it for a profit," Faraj and colleagues explain. While private equity acquisition may have benefits such as increased efficiency, it also has potential drawbacks, such as prioritizing costs and revenue over patient welfare.

The study analyzed scores on Medicare's MIPS system, which assesses physicians' performance in the categories of quality, improvement activities, promoting interoperability, and cost. Under MIPS, physicians who exceed defined performance levels earn payment bonuses, while those who underperform receive payment penalties. 

The researchers assessed MIPS scores for 181 urologists whose practices were acquired by private equity firm between 2017 and 2020. Of all urologists participating in MIPS during the study period, about 7 percent worked in a practice acquired by private equity.  

Scores on MIPS were compared for the year before and after practice acquisition, and to those of a matched group of urologists whose practices were not acquired. Before acquisition, the two groups had similar scores overall and in each MIPS category. 

For urologists at acquired practices, MIPS scores decreased significantly in the year after acquisition. Overall MIPS score decreased to 75 (on a 100-point scale), compared to 86 for urologists whose practices were not acquired. 

Scores for quality were also lower in the acquired group: 73 versus 89. Scores in other MIPS categories were similar between groups. Reductions in overall MIPS and quality scores at acquired practices were associated with a sharp reduction in the percentage of urologists receiving Medicare bonus payments: 35 percent, compared to 72 percent of urologists whose practices were not acquired. 

After adjustment for differences between groups, private equity acquisition was associated with a 14-point reduction in overall MIPS score, which was attributable to a 29-point reduction in quality score. There was an estimated 34. percent reduction in bonus payments to physicians at acquired practices. 

The authors note some limitations of their study, including whether the reductions in MIPS scores at urology practices acquired by private equity truly represent reductions in quality of care. Decreases in quality score "may reflect divestment of resources to MIPS quality reporting, which requires significant human capital," the researchers write. But regardless, the decrease in MIPS scores "had reimbursement implications for the urologists at these practices." 

"As private equity firms increasingly engage in urology, key stakeholders, including policymakers and urologists, need to ensure that the quality of care is not compromised with the structural changes implemented after acquisition," Faraj and coauthors conclude. "Until more research is done to determine the effect of these acquisitions on patient care, it is important for practices to be transparent about their relationship with for-profit entities with patients and referring providers." 

Sponsored Recommendations

Trailblazing Technologies: Looking at the Top Technologies for the Emerging U.S. Healthcare System

Register for the first session of the Healthcare Innovation Spotlight Series today to learn more about 'Healthcare's New Promise: Generative AI', the latest technology that is...

Data: The Bedrock of Digital Engagement

Join us on March 21st to discover how data serves as the cornerstone of digital engagement in healthcare. Learn from Frederick Health's transformative journey and gain practical...

Northeast Georgia Health System: Scaling Digital Transformation in a Competitive Market

Find out how Northeast Georgia Health System (NGHS) enabled digital access to achieve new patient acquisition goals in Georgia's highly competitive healthcare market.

2023 Care Access Benchmark Report for Healthcare Organizations

To manage growing consumer expectations and shrinking staff resources, forward-thinking healthcare organizations have adopted digital strategies, but recent research shows that...