I'm Praveen Suthrum. After 13 years of building and running NextServices, a healthcare technology/management company, the challenges and opportunities in the industry leap out at me. I also get early access to industry trends and changes.

Whether you are seeking to start or grow your healthcare business, my weekly insights will make you spot opportunities and stay on top of your game. It'll help you think differently about healthcare.

Two ways people consistently describe what I write: 
"insightful" and "thought-provoking".

Sign-up for my newsletter to get early and exclusive access to material that I don't write about elsewhere.

A new healthcare law to worry about

A new healthcare law to worry about

There's always something new to worry about for the healthcare industry.

On Jan 1st, 2017, a new law to track physician performance went into first gear. It's called MACRA - a law that could be as important as the Affordable Care Act, which led to the name Obamacare.

MACRA is short for Medicare Access and CHIP Reauthorization Act of 2015, which was signed into law in April 2015. It's an attempt to give carrots and sticks to clinicians. Payments or penalties based on quality of care.

MACRA's intent is to pay clinicians based on outcomes. Have them compete with each other by issuing penalties for one half and incentives for the other.

MACRA is applicable for 55 million people in the US, covered under Medicare (federal insurance for 65 or older and people with disabilities). These patients are served by more than 500,000 clinicians who will now come under its umbrella.

The law streamlines older mandates (of EHR incentives and Quality Reporting) into a single rule. It has two tracks under the Quality Payment Program: Merit-Based Incentive Payment System (MIPS) and Advanced Alternate Payment Model (APM).

Most physicians are likely qualify for MIPS rather than APM.

[Advisory Board's Q&A about MACRA final rule is a sound read]

A 2,398 page long administrative burden

To start with, the final rule is 2,398 pages long. You can skim it here.

As with many laws, the makers are concerned with covering all bases. In doing so, what we have is a mammoth dictum that can drown its intentions.

Even if doctors follow the law as intended with or without help of consultants, new requirements call for an increase in reporting. Doctors or their staff will have to figure out what categories they qualify for, measures they would like to adhere to, track them while seeing patients, code accurately later and ensure completion before annual deadlines.

It's estimated that quality reporting costs $40,069/physician/year. That's about $15.4 billion in tracking and reporting measures for Medicare, Medicaid and private insurers.

Expect administrative burden to go up significantly given the uncertainty surrounding MACRA and its expansiveness.

"Focus is the patient." But is it?

The day Centers for Medicare and Medicaid (CMS) released the final rule, they wrote on their blog that the focus was the patient because physicians could now report on only pertinent measures. If everyone spends more time and effort in reporting then shouldn't an equivalent saving ensue through better patient care?

This is more wishful thinking than what might happen in practice.

Under quality improvement programs, doctors are required to report that they are adhering to specific quality measures (e.g. doing a foot exam for a diabetic patient).

These measures are converted to a point-based system. Using points, doctors are compared to other doctors. A score is derived based on what they could've done vs what they did. That finally determines how much someone makes.

Not simple.

As one doctor said, "I'll now have to prove that my patient is obese when it's so obvious that he is!"

[Read: Some doctors are advocating just saying no to MACRA]

Scoring makes the effort into a game. The composite score becomes a goal in itself beyond patient care.

Private insurance companies often follow Medicare

The insurance business model unfortunately works on denying or delaying or making partial payments. Lesser the payouts, greater the profitability. Some smaller insurance companies can make payments only until their monthly budgets run out.

MACRA has the risk of establishing a new payment norm for a large percentage of doctors. A doctor could earn less. Work more completing administrative tasks.

Private insurance companies often follow what federal insurances do. For example, they establish fees based on Medicare's fee schedule. When Medicare fees drop, their fees drop. A regulation linked to payments could wickedly hand them a new tool to curtail payouts.

Physicians and their medical societies, already divided, will not be able to stand against insurance behemoths.

Of course, I love the intention of MACRA. Improving quality of care is welcome.

What is worrisome is its implementation. We will begin to see its full impact only in 2019 when CMS determines payments for what goes live now.

Many pegs need to fall into their right places. Doctors need to embrace it by following measures as intended. Patients need to benefit from better quality because of those measures. Administrators need to ensure financial sustainability amidst increased workload.

For its own sake, healthcare needs to be far more streamlined than it is. Watch out before it becomes a millstone around our industry's neck.

Why are cat videos easier to share than medical records?

Why are cat videos easier to share than medical records?

The doctor behind the screen

The doctor behind the screen