CMS presents evidence that its P4P demo is effective. Source: Education Week

A Medicare pay-for-performance (P4P) demonstration project that relies on health IT to hold down healthcare costs and improve quality has resulted in extra earnings of $16.7 million for 10 large group medical practices across the United States.

In second-year results reported Aug. 14, the Centers for Medicare & Medicaid Services (CMS) said that the four-year project also delivered $5.8 million to the Medicare Trust Fund that achieved more than 20 percent of the savings by providing better, more coordinated care for the patients at the group practices over the last two years.

All 10 of the participating physician groups achieved benchmark or target performance on at least 25 out of 27 quality markers for patients with diabetes, coronary artery disease and congestive heart failure.

“We are paying for better outcomes and we are getting higher quality and more value for the Medicare dollar,” said Acting CMS Administrator Kerry Weems. “And these results show that by working in collaboration with the physician groups on new and innovative ways to reimburse for high-quality care, we are on the right track to find a better way to pay physicians.”

Five of the physician groups—Forsyth Medical Group, Geisinger Clinic, Marshfield Clinic, St. John’s Health System and the University of Michigan Faculty Group Practice— achieved benchmark quality performance on all 27 quality measures, according to CMS.

The demonstration is one of CMS’ value-based purchasing (VBP) initiatives, designed to tie Medicare payments to performance on healthcare cost and quality measures. The agency said that VBP is part of CMS’ drive to transform Medicare from a passive payor to an active purchaser of higher quality, more efficient healthcare.
 
A related CMS physician VBP effort is the Physician Quality Reporting Initiative (PQRI), which uses a pay-for-reporting approach. Under the PQRI, physicians and other healthcare professionals can earn incentive payments for reporting measurement data about the quality of care they provide to Medicare patients, according to CMS.
 
CMS said it is also developing a Physician VBP Plan for moving from the PQRI pay-for-reporting approach to a performance-based approach for Medicare physician payments. 
 
The 10 physician groups participating in the P4P demonstration agreed to place their PQRI incentive payments at risk for performance on the 27 quality measures reported under the demonstration. All physician groups received at least 96 percent of their PQRI incentive payments, with five groups earning 100 percent of their incentive payments. A total of $2.9 million in PQRI incentive payments was paid out to the 10 groups under the demonstration, according to the agency.
 
The groups also improved the quality of care delivered to Medicare beneficiaries on the chronic conditions measured.  Physician groups increased their quality scores an average of 9 percentage points across the diabetes mellitus measures, 11 percentage points across the heart failure measures and 5 percentage points across the coronary artery disease measures.

The groups are Billings Clinic in Billings, Mont.; Dartmouth-Hitchcock Clinic in Bedford, N.H.; The Everett Clinic in Everett, Wash.; Forsyth Medical Group in Winston-Salem, N.C.; Geisinger Clinic in Danville, Pa.; Marshfield Clinic in Marshfield, Wis.; Middlesex Health System in Middletown, Conn.; Park Nicollet Health Services in St. Louis Park, Minn.; St. John’s Health System, Springfield, Mo.; and the University of Michigan Faculty Group Practice in Ann Arbor, Mich.