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21–108 2016

DEVELOPING A VIABLE MEDICARE 

PHYSICIAN PAYMENT POLICY 

HEARING 

BEFORE THE

SUBCOMMITTEE ON HEALTH 

OF THE

COMMITTEE ON WAYS AND MEANS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

MAY 7, 2013 

SERIAL NO. 113–HL03 

Printed for the use of the Committee on Ways and Means 

( 


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COMMITTEE ON WAYS AND MEANS 

DAVE CAMP, Michigan, Chairman 

SAM JOHNSON, Texas 

KEVIN BRADY, Texas 

PAUL RYAN, Wisconsin 

DEVIN NUNES, California 

PATRICK J. TIBERI, Ohio 

DAVID G. REICHERT, Washington 

CHARLES W. BOUSTANY, JR., Louisiana 

PETER J. ROSKAM, Illinois 

JIM GERLACH, Pennsylvania 

TOM PRICE, Georgia 

VERN BUCHANAN, Florida 

ADRIAN SMITH, Nebraska 

AARON SCHOCK, Illinois 

LYNN JENKINS, Kansas 

ERIK PAULSEN, Minnesota 

KENNY MARCHANT, Texas 

DIANE BLACK, Tennessee 

TOM REED, New York 

TODD YOUNG, Indiana 

MIKE KELLY, Pennsylvania 

TIM GRIFFIN, Arkansas 

JIM RENACCI, Ohio 

SANDER M. LEVIN, Michigan 

CHARLES B. RANGEL, New York 

JIM MCDERMOTT, Washington 

JOHN LEWIS, Georgia 

RICHARD E. NEAL, Massachusetts 

XAVIER BECERRA, California 

LLOYD DOGGETT, Texas 

MIKE THOMPSON, California 

JOHN B. LARSON, Connecticut 

EARL BLUMENAUER, Oregon 

RON KIND, Wisconsin 

BILL PASCRELL, JR., New Jersey 

JOSEPH CROWLEY, New York 

ALLYSON SCHWARTZ, Pennsylvania 

DANNY DAVIS, Illinois 

LINDA SA ́ NCHEZ, California 

JENNIFER M. SAFAVIAN, Staff Director and General Counsel 

JANICE MAYS, Minority Chief Counsel 

SUBCOMMITTEE ON HEALTH 

KEVIN BRADY, Texas, Chairman 

SAM JOHNSON, Texas 

PAUL RYAN, Wisconsin 

DEVIN NUNES, California 

PETER J. ROSKAM, Illinois 

JIM GERLACH, Pennsylvania 

TOM PRICE, Georgia 

VERN BUCHANAN, Florida 

ADRIAN SMITH, Nebraska 

JIM MCDERMOTT, Washington 

MIKE THOMPSON, California 

RON KIND, Wisconsin 

EARL BLUMENAUER, Oregon 

BILL PASCRELL, JR., New Jersey 


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C O N T E N T S 

Page 

Advisory of May 5, 2013 announcing the hearing ................................................ 2 

WITNESSES 

Mr. Patrick Courneya, MD, Medical Director, HealthPartners Health Plan, 

Minneapolis, MN .................................................................................................. 63 

Mr. Charles Cutler, MD, Chair, Board of Regents, American College of Physicians, Norristown, PA .......................................................................................... 31 

Mr. David Hoyt, MD, Executive Director, American College of Surgeons, 

Chicago, IL ............................................................................................................ 7 

Mr. Frank G. Opelka, MD, Vice-Chair, Consensus Standards Approval Committee, National Quality Forum, New Orleans, LA .......................................... 46 

Mr. Kim Allan Williams, MD, Past President, American Society of Nuclear 

Cardiology, Detroit, MI ........................................................................................ 22 

MEMBER SUBMISSION FOR THE RECORD 

Darrell Issa and Sam Farr, letter .......................................................................... 97 

SUBMISSIONS FOR THE RECORD 

Alliance for Quality Nursing Home Care, statement ........................................... 100 

American Society of Transplant Surgeons, statement .......................................... 102 

American Speech-Language-Hearing Association, legislative principles ............ 107 

California Hospital Association, letter ................................................................... 109 

California Association of Physician Groups, CAPG, letter ................................... 111 

Community Hospital of the Monterey Peninsula, letter ...................................... 112 

Greenway Medical Technologies, letter ................................................................. 114 

Mayo Clinic, testimony ............................................................................................ 117 

Medical Society of New Jersey, letter .................................................................... 124 

Medicare Rights Center, statement letter ............................................................. 127 

Monterey County Medical Society, letter ............................................................... 132 

Palomar Health, letter ............................................................................................ 133 

Riverside County Medical Association, letter ........................................................ 135 

San Bernardino County Medical Society, letter .................................................... 136 

San Diego County Medical Society, letter ............................................................. 137 

Santa Barbara County Medical Society, letter ...................................................... 138 

Sharp HealthCare, letter ........................................................................................ 139 

Sierra Sacramento Valley Medical Society, letter ................................................. 141 

Sonoma County Medical Association, letter .......................................................... 143 

Sutter Maternity & Surgery Center of Santa Cruz, letter ................................... 145 


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DEVELOPING A VIABLE MEDICARE 

PHYSICIAN PAYMENT POLICY 

TUESDAY, MAY 7, 2013 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON WAYS AND MEANS, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 10:06 a.m. in 

Room 1100 Longworth House Office Building, the Honorable Kevin 

Brady [Chairman of the Subcommittee] presiding. 

[The advisory announcing the hearing follows:] 


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Chairman BRADY. Good morning, everyone. The subcommittee 

will come to order. I want to welcome everyone to today’s hearing 

on addressing the broken Sustainable Growth Rate formula by 

which the Federal Government reimburses our local doctors for 

treating Medicare patients. While this is our third hearing, the 

SGR has been the focal point of the first two, as well. 

The first hearing was on redesigning the Medicare benefit package to make it more rational and responsive to seniors and Medicare patients. In that discussion, we heard that solving the SGR 

problem is key to maintaining a strong Medicare program. 

The second hearing was on the Medicare Payment Advisory Commission recommendations for improving the various payment systems. In that discussion we heard that now is the time to repeal 

the SGR. I couldn’t agree more with both of these sentiments. We 

need to repeal the SGR so that seniors continue to have access to 

their local doctors. 

Physicians are understandably frustrated. In our communities 

we are witnessing firsthand how the current broken system is forcing doctors to rethink their future with Medicare, consider closing 

their private practices, or joining up with a hospital. And who can 

blame them? The SGR is a major contributor to an unhealthy system, and it needs to change this year. 

We need to reform the physician payment system to reward highquality care to patients and value to health care. The current feefor-service payment system treats all services the same, and fails 

to take into account the quality of the care provided or how efficiently that care was furnished. This needs to change too. 

Building on the subcommittee’s efforts in the 112th Congress, 

Chairman Dave Camp and I joined with our counterparts on the 

Energy and Commerce Committee to engage with physician organizations and other stakeholders on how best to achieve this goal. 

These stakeholders have provided extensive feedback on two 

iterations of the proposal that would first repeal the SGR, provide 

a period of payment stability, then reward quality and value by 

using metrics that physicians believe in. And then, finally, allowing 


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physicians to voluntarily opt for alternative payment models if they 

better meet their needs. 

This hearing enables the subcommittee to hear from a few of the 

many organizations that provide a constructive response to these 

proposals. The subcommittee will benefit from their experience and 

insights. 

The hearing also provides the subcommittee the opportunity to 

hear some perspectives that complement the voice of the physician, 

especially organizations. These perspectives help us understand 

that the payment system improvements we envision for Medicare 

can be accomplished. 

More importantly, this hearing will help the subcommittee roll 

up its sleeves and get on with the hard work of developing a viable 

physician payment reform policy. And crafting this policy need not 

be a partisan exercise. While we certainly have our differences, 

permanently fixing the SGR this year is a shared goal. I am 

pleased that the Majority and the Minority jointly selected the witnesses we will hear from shortly. This is an important step in the 

effort to find a bipartisan policy solution. My hope is that we continue to collaborate as we talk to physicians on an ongoing basis. 

While finding the money to pay for an SGR replacement policy 

remains a challenge, the most recent Congressional Budget Office 

SGR repeal estimate surely helps. Using its new Medicare spending projections, CBO estimates that freezing Medicare physician 

payments at their current level over a 10-year period would cost 

$138 billion. This is significant reduction from its $243 billion estimate for the same policy just a few months before. 

I do look forward to working with my friends on the other side 

of the aisle when we start talking about how to pay for the SGR 

solution. We will eventually have to go down that hard road, not 

only to pay for it, but also to address our spending problems. But 

let’s put that aside for now. 

Let’s work together as Republicans and Democrats engaged with 

the physicians and other stakeholders to get the payment reform 

policy right. The goal is not a perfect policy, but a good, sound policy. Let’s craft when the bill is on the momentum of the dialogue 

that continues here today, and takes advantage of the more favorable CBO cost estimate. Together let’s get it done this year. 

Before I recognize Ranking Member McDermott for the purpose 

of an opening statement, I ask unanimous consent that all Members’ written statements be included in the record. 

[No response.] 

Chairman BRADY. Without objection, so ordered. I now recognize Ranking Member McDermott for his opening statement. 

Mr. MCDERMOTT. Thank you, Mr. Chairman. I think you were 

looking over my shoulder. You wrote my speech and read it. 

[Laughter.] 

Mr. MCDERMOTT. This Committee has been wrestling with the 

need to reform Medicare’s physician payment system for more than 

a decade. But for a variety of reasons, Congress has not yet been 

able to send a proposal to the President. We may have a rocky road 

ahead, but I hope this year we can succeed. We can’t afford not to. 

The Sustainable Growth Rate Formula is fundamentally broken. 

As Congress acted to override the formula’s cuts, the hole has been 


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dug deeper every year. And, let’s be honest, no one ever expects 

that we are going to cut 30 percent in fees. But the uncertainty 

promotes profound discomfort and instability in the system. 

It is patently unfair to ask physicians or others paid under the 

fee schedule to live with the sword of Damocles hanging over their 

head year after year after year. And I understand we can’t just repeal it and move to an unrestrained inflationary debate—or update. But the SGR’s threat has dampened physician spending, even 

if it has been a series of dysfunctional changes, often last-minute 

efforts to avert disaster. 

Instead, we need to replace it with a sensible policy that reflects 

a more modern care delivery system. We need a policy that rewards quality, not quantity. We need a policy that gives incentives 

for teamwork, coordinated care, with strong primary care components. We need a policy that helps promote getting the right care 

to the right patient at the right time. More than anything, we want 

provider accountability. 

Now, let’s be clear—and I know it as well as anybody on the 

panel—this is a difficult set of objectives. They won’t be accomplished with one fell swoop. They are not going to be. There is no 

silver bullet in this business. But it is the time to take some steps 

forward in this challenge. We don’t have to start over; we can build 

on what works and what is already working out there in some 

places. We should use physician expertise to develop measures, but 

we must have an accountable public actor as the ultimate arbiter. 

Looking at the—among other things, makes it clear that we can’t 

afford to yield such critical decision-making to unaccountable or 

self-interested private organizations. There is too much at stake. 

The cost is still high, but it is lower than it has been in years. And 

the cost of inaction and more patches will be higher still over time. 

I am pleased the chairman seems to want to work together on 

this replacement policy. As he said, the choice of the witnesses was 

doing jointly, which was really a revolutionary experience in the 

House of Representatives. I don’t know if it went on in any other 

committee ever before, but it is a good step. Next will be drafting. 

We hope we can do the drafting together. 

The chairman’s outlines are a good start. But without some detail, we will have to find out where the common ground is. It is like 

being invited to go to three cities in Europe. I would like to know 

which city we are going to before I sign up totally for the trip. But 

I am very much involved in wanting to go on a trip. 

Now, given the bipartisan interest in this, I want to acknowledge 

that paying for this endeavor will likely be the cause of the most 

controversy and potential disagreement. It will be difficult, if not 

impossible, for me and many other Democrats to support a package 

that is financed by shifting costs onto beneficiaries, especially given 

that there are other offsets that are available. 

This policy could be entirely financed by ending a windfall that 

was created by the Congress for big PhRMA when we enacted the 

Medicare Part D. Again, the average Medicare beneficiary has a 

household income of $22,500. No one should ever forget that. And 

the average physician income, on the other hand, is about 

$180,000. I won’t support Robin Hood in reverse, especially when 

people have paid into the program for deficits—for decades. 


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But I thank the chairman for holding this hearing. But more importantly, I show—I thank him for showing an interest in a bipartisan approach. The Medicare program and the nation will be better for it. And I think that today’s testimony—I am looking forward 

to it because it is a good start. Thank you. 

Chairman BRADY. Great. Thank you. Today we will hear from 

five witnesses: Dr. David Hoyt, executive director of the American 

College of Surgeons; Dr. Kim Allan Williams, the past president of 

American Society of Nuclear Cardiology; Dr. Charles Cutler, the 

chair and the board of regents, American College of Physicians; Dr. 

Frank Opelka, vice-chair, consensus standards approval committee 

with the National Qualify Forum; and Dr. Patrick Courneya, 

health plan medical director for HealthPartners. 

Thank you all for being here today and I look forward to your 

testimony. You will all be recognized for five minutes for the purposes of providing your oral remarks, and we will begin questioning 

after that. 

Dr. Hoyt, we will begin with you. 

STATEMENT OF DR. DAVID HOYT, EXECUTIVE DIRECTOR OF 

THE AMERICAN COLLEGE OF SURGEONS 

Dr. HOYT. Thank you, Chairman Brady, Ranking Member 

McDermott, and Members of the Committee. I am David Hoyt, the 

executive director of the American College of Surgeons. On behalf 

of the more than 79,000 members of the college, I am pleased to 

be here today to discuss the reform of Medicare physician payment 

system, and to highlight some challenges moving forward that are 

described in greater detail in the college’s February and April letters that have been submitted for the record. The college appreciates the committee’s continued commitment to address the complex problems facing Medicare’s physician payment system, and applaud your work in inclusiveness. 

In our February letter, the college outlined our value-based update, VBU, proposal to reform physician payment—the physician 

payment system. We believe that any new payment system must 

be based on the complementary objectives of improving outcomes, 

quality, safety, and efficiency, while simultaneously reducing the 

growth in health care spending. The VBU proposal is based on the 

college’s 100 years of experience in creating programs to improve 

surgical quality and patient safety, such as the National Surgical 

Quality Improvement Program, or NSQIP. 

We have learned that measuring quality improves patient care, 

increases the value of health care services, and reduces cost. The 

savings gained are a direct result of improving quality outcomes. 

We agree with the joint commission proposal that a full repeal 

of the SGR and a period of payment stability are prudent first 

steps in reforming the system, while longer-term reforms are developed, tested, and phased in over several years. The college believes 

that the phase one period of payment stability should be for five 

years. If we were to move to a value-based system, it is imperative 

that we make sure the payment models and the quality measures, 

which will serve as the backbone of the new system, are properly 

aligned, and that will take some time. The college urges Congress 

to provide statutory payment rates tied to inflation during the peVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00011 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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riod of stability. Such stability will allow physicians to make necessary capital investments in their practices to move to a valuebased system. 

In phase two of the joint proposal, the college believes that the 

most critical component to successfully establishing a base payment rate tied with a variable rate is that it incentivizes high-quality care and does not just function through a withhold. Providers 

willing to take on the risk based on performance associated with 

the variable rate must first see a starting base rate at an appropriate level to cover the work and expenses required to provide the 

necessary care. We believe that the base rate should be based on 

the market value at the end of five years of stability. The college 

further believes that once the starting base rate is appropriately 

determined, subsequent base rates should account for the increased 

cost of providing care by increasing with inflation. 

It is crucial that the variable rate not only require a level of risk 

by physicians that may result in a reduced payment, but it is—also 

contains a level of reward that—with increased payment for those 

physicians who achieve the highest quality care. The cost savings 

we have seen through our quality programs are in the money saved 

by the improved outcomes. We believe that a variable rate should 

be determined as to whether a physician meets a specific performance threshold. For a new system to flourish, we must encourage 

those high performers to share their techniques with those who do 

not meet the performance threshold. Whether a physician experience is an increase or a decrease from the base rate should be determined by performance, compared to standards or thresholds. 

We would like to emphasize that a zero sum budget-neutral scoring methodology for the variable rate could significantly hamper 

collaborative care, the sharing of best practice amongst providers, 

and hinder our ability to recognize all the possible savings. 

In our century of experience, the college has learned that the real 

cost savings are best realized from coordinated care. Numerous elements of the committee’s proposal relative to performance measurement are strictly specialty or service-based. In contrast, our VBU 

proposal, which centers on clinical affinity groups, breaks down the 

silos of physician care. The CAGs, which have collective quality 

and performance measures, are designed to be inclusive of multiple 

specialties working in concert to treat the patient. 

In developing quality and performance measures, the college believes that we must be able to provide sufficient measures representing all specialties. The committee’s proposal on measure development could lead to potential conflict between measures that go 

through the NQF process and those that use the proposal’s suggested non-NQF process. The college recognizes that there are challenges with the NQF approval process, but that—that have led to 

frustration among specialties and physicians. However, with the 

possibility of multiple entities approving measures, there exists the 

real possibility the physicians could be compared with each other, 

while not pursuing the same measure set. Alternative measure sets 

need clear evidence of effectiveness if they are to be used. 

Finally, the college believes it is incumbent upon every physician 

and health care provider to commit to being a responsible steward 

of the nation’s health care resources. Physicians and other proVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00012 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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viders will work together to achieve cost savings with—and those 

savings cannot be constrained by the current financing silos of the 

Medicare program. As physicians work to bring costs down, those 

savings should be accessible to those who are achieving the savings, whether in Parts A, B, C, or D. 

We appreciate the opportunity to address the second draft of the 

joint proposal, and look forward to working as partners in forging 

a new patient-centric, quality-based health care system. Thank you 

very much. 

Chairman BRADY. All right. Thank you, Dr. Hoyt. 

[The prepared statement of Dr. Hoyt follows:] 


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STATEMENT OF DR. KIM ALLEN WILLIAMS, MEMBER OF THE 

ASNC HEALTH POLICY STEERING COMMITTEE 

Chairman BRADY. Dr. Williams, we will reserve five minutes for 

your discussion. 

Dr. WILLIAMS. Thank you, Chairman Brady, Ranking Member—— 

Chairman BRADY. Can you get that microphone, Doctor? 

Dr. WILLIAMS. Got it. 

Chairman BRADY. Thanks. 

Dr. WILLIAMS. Thank you, Chairman Brady, Ranking Member 

McDermott, and other distinguished Members of the Ways and 

Means Health Subcommittee. We thank you for the opportunity to 

testify on behalf of American Society of Nuclear Cardiology, otherwise known as ASNC. ASNC is a leader in education, advocacy, 

and quality for the field of nuclear cardiology that was founded in 

1993, and represents about 4,600 physicians, technologists, and scientists worldwide dedicated to the science and practice of nuclear 

cardiology. My name is Kim Allan Williams. I was formerly president of ASNC, and am currently a member of the health policy 

steering committee. 

ASNC and many other specialty societies are encouraged very 

much by the committee’s solicitation of physician input on the SGR 

repeal and the development of alternative reimbursement and delivery models. This partnership is very likely to lead to legislation 

that reflects the intricacies of clinical practice and advances best 

practices. To that end, I would like to propose that we talk a little 

bit about clinical data registries. 

ASNC was involved very much in the development of appropriate 

use criteria, in partnership with several other organizations, in 

order to reduce the number of inappropriately ordered and performed tests. Decision support tools such as guidance on the proper 

use of stress protocols and tracers are important initial steps in 

quality imaging, and ASNC will continue to collaborate in the development of decision support tools to assist referring physicians 

and nuclear cardiology professionals. 

To further assure appropriateness and patient-centered imaging, 

ASNC is currently establishing the groundwork for a cardio-vascular-imaging registry. This will begin with nuclear cardiology, but 

hopefully it will be expanded to further—other modalities in cardiac imaging in the future. This is a natural progression of prior 

quality initiatives such as clinical application guidelines, imaging 

procedure guidelines, physician certification, laboratory accreditation, and the appropriate use criteria. 

We do envision that the imaging registry will be a major instrument in allowing the development of a robust set of clinical performance metrics of interest to private payers, as well as Medicare 

and Medicaid, and other policy matrix. These metrics may add further weight to the reality that medical imaging is good medicine, 

and inform proper reimbursement and performance incentives. Advances in medical imaging really have changed the way that physicians take care of patients on a daily basis. And integrating medical technology into care plans can save costs by lowering the 

amount of wasteful and ineffective invasive testing and treatments. 


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As stated, the—our hope is that ASNC can develop the groundwork and define initial quality metrics. The initial phase of the registry development hopefully is going to be the end of 2013, first 

quarter of 2014, and will be focused on data collection and 

foundational performance metrics that relate to radiation safety 

and dose protocols, timeliness of reporting of test results, and clinical indications, most importantly. The registry results will be focused on building the resources related to implementation of patient-centered imaging protocols and reporting of appropriate use. 

In subsequent phases in 2015 and 2016, ASNC intends to develop the capability to follow the patient through the continuum of 

care. Partnerships with other registries in the field of cardiology 

will assist this initiative. We can track adherence to appropriate 

use criteria and the result in treatment decisions, such that the 

cardio-vascular-imaging registry may illustrate that nuclear cardiology does affect downstream cost in a positive way through more 

appropriate selection of patients who need invasive and further 

therapies. 

We expect that the metrics that we develop will be—enable Congress and CMS to engage ongoing clinical improvement initiatives 

and, with this data, effectively tie reimbursement to these initiatives. Credit should be given for quality improvement initiatives 

that are already in place and ongoing, not just for new initiatives 

each year. 

And there should be broader, ongoing recognition for achieving 

and maintaining board certification, lab accreditation, performing 

laboratory quality assurance, and participation in registries such 

as the one proposed by ASNC. These are integral quality activities, 

and we would hope that annual metric updates would not ignore 

these ongoing quality measures simply by looking for new initiatives less related to quality. Financial incentives should be provided to physicians who participate in registries, receive feedback, 

and address any quality deficiencies that are discovered. 

In terms of the reward for clinical improvement of activities and 

pay for performance, we embrace the methodology that rewards the 

specialty’s advancement in care and quality improvement activities, 

and we are—we expect that in a system of fee for service, provided 

that that continues, ASNC would propose that physicians are 

awarded with the highest levels of—when they have the highest 

levels of performance, an increment above the baseline fee schedule, and with negative updates for those who are not performing 

and not participating and not improving. So we are actually in 

favor of that concept. 

In terms of the stability of the physician reimbursement, the 

SGR framework, we applaud all of the efforts to try and rework 

this in such a way that there are not shocks to the system of physicians and their businesses. And we really want to try and replace 

this with quality measures that can be very much cost savings. 

Chairman BRADY. Great. Doctor, thank you very much for your 

testimony. 

[The prepared statement of Dr. Williams follows:] 


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STATEMENT OF DR. CHARLES CUTLER, CHAIR OF THE BOARD 

OF REGENTS OF THE AMERICAN COLLEGE OF PHYSICIANS 

Chairman BRADY. Dr. Cutler. 

Dr. CUTLER. My name is Charles Cutler. I am chair of the 

board of regents of the American College of Physicians. The college 

represents 133,000 internal medicine physicians and medical student members. I am a full-time primary care internist in a multispecialty group practice in Norristown, Pennsylvania. 

The college wishes to thank subcommittee Chairman Brady and 

Ranking Member McDermott for convening this hearing. We also 

thank Chairman Camp and Energy and Commerce Chairman 

Upton for proposing a bold plan for Medicare payment reform that 

holds the promise of breaking a decade-long impasse on the SGR 

repeal. 

We thank Representative Schwartz for her leadership in sponsoring, along with Representative Heck, the Medicare Physician 

Payment Innovation Act. This bill, which we support, has a similar 

approach as the Campton-Upton [sic] proposal and merits strong 

consideration. 

The college believes that the Camp-Upton plan has four key elements needed to create a viable Medicare payment system: it repeals the SGR; it stabilizes payments; it phases in value-based 

models; and provides multiple pathways for physicians to participate in efforts to improve quality and effectiveness. We request 

that the committee consider adding the following five policies to the 

chairman’s proposal. 

First, establish annual positive baseline updates for all physicians for at least the next five years, with a higher update for evaluation and management services. 

Second, create opportunities for physicians to qualify for additional incentive updates on a graduated scale for participating in 

a CMS-approved or deemed value-based initiative starting in 2014. 

Third, create a process by which CMS could deem a private sector initiative to qualify physicians for graduated incentive payments. 

Fourth, we support rigorous standards for deemed programs to 

ensure that they improve quality and effectiveness. 

And fifth, enable practices that have received independent recognition as patient-centered medical homes, to qualify for the graduated incentive program. Thousands of physician practices providing care to tens of millions of privately-insured patients have 

achieved accreditation as patient-centered medical homes. Extensive data demonstrates their effectiveness. Yet Medicare’s support 

for this model is mostly limited to several hundred practices participating in Medicare’s comprehensive primary care initiative. 

These practices are paid their usual fee-for-service payment plus 

a monthly risk-adjusted care coordination payment for each patient, plus the opportunity for shared savings. In return, they agree 

to be evaluated by a robust metrics—set of metrics. But even for 

these practices, traditional fee-for-service remains the single largest part of their Medicare payment. 

Medicare payment policies should also recognize the far-greater 

number of recognized patient-center medical-home practices that 

are delivering high-quality, coordinated care to all of their patients, 


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including Medicare practices which, nonetheless, receive no support 

from Medicare, other than the usual fee-for-service payment. Related, the NCQA has a new medical home neighborhood accreditation program for specialty practices that meet standards related to 

the coordination of care, creating a pathway for non-primary-care 

specialists potentially to qualify for incentive payments. The bottom line is patient-centered medical homes have the track record 

to be scaled up and support by Congress now. 

Finally, following five years of stable and positive payments during which physicians could qualify for additional, value-based incentive payments, Congress could set a date by which time physicians would be in a new payment model or a deemed program, or 

be subject to reduced annual payment updates with hardship exceptions excluded. 

We believe the most effective approach, however, is to create 

positive incentives for physician-led models that, when supported 

by an improved payment system, will enable physicians to deliver 

better and more effective care. Thank you for listening today. 

Chairman BRADY. Thank you, Dr. Cutler. 

[The prepared statement of Dr. Cutler follows:] 


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STATEMENT OF DR. FRANK G. OPELKA, VICE CHAIR CONSENSUS STANDARDS APPROVAL COMMITTEE MEASURE APPLICATIONS PARTNERSHIP NATIONAL QUALITY FORUM 

Chairman BRADY. Dr. Opelka. 

Dr. OPELKA. Thank you, Chairman Brady and Ranking Minority Member McDermott and committee Members, for inviting me to 

participate in today’s hearing on behalf of the National Quality 

Forum. My name is Frank Opelka, and I am the vice-chair for the 

NQF’s consensus standards approval committee, the CSAC, which 

I will chair coming this July. The CSAC oversees measure endorsement and the NQF. My day job is the executive vice president for 

health at Louisiana State University and associate medical director 

of the American College of Surgeons. 

The NQF was founded in 1999 as a non-profit, non-partisan organization with members spanning all of health care, beginning with 

specialty society physicians, patient advocates, hospitals, businesses, and more. The NQF has two main roles: to convene its 

members to endorse performance measures, and to recommend to 

HHS, which measures best fit within the various CMS payment 

programs. 

I am here today because, without the NQF, we would have hundreds of measures from specialty societies, from health plans and 

others, bombarding physicians and hospitals with a sea of their favorite but very different measure preferences, making it untenable 

for me or for my hospital to report meaningful measures to help patients. Just imagine the confusion of five different measures for 

heart attack, one from each major health plan, or one from those 

associated specialties caring for the heart disease, or different 

measures for the same surgical operation. Which measure would 

we choose to report? Which result should a patient use? 

Mr. Chairman, we commend you and the entire committee for 

undertaking the critical task of reforming physician payment and 

for placing quality at the center. To focus on quality will only work 

if the measurement tools are themselves high fidelity. To have an 

impact, quality measures must first have physician input to establish the highest medical and scientific standards. That is why over 

400 physicians volunteer alongside experts from hospitals, patient 

advocates, and business groups, joining together to total over 850 

individuals volunteering to serve on NQF committees. 

Mr. Chairman, the measurement work of the NQF is predicated 

on delivering results that improve care, work toward affordability, 

and inform patients. Some examples of NQF-endorsed measures 

have, as noted in a CDC report, helped promote 58 percent reduction in central line infections between 2001 and 2009, saving more 

than 6,000 lives and estimated $1.8 billion in cost. The NQF measures and physician groups across Wisconsin worked to lower cholesterol and improved breast cancer screening when compared to 

other physician groups outside the NQF across the tri-state region. 

NQF measures added in reducing mortality rates in 650 hospitals 

using the endorsed safe practices of the NQF. NQF-endorsed 

perinatal measures promoted a limit on newborn deliveries prior to 

39 weeks, reducing the need for newborns in ICUs by 16 percent 

in 27 hospitals. 


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So, what does the NQF mean to me? The NQF takes measured 

developers and takes their measures and convenes specialty society 

experts, along with patients and business groups, to assess measures for their importance to patients, for their scientific properties, 

for their feasibility for the burden of implementation, and the 

meaningfulness to the end users: physicians, hospitals, and patients. 

Of the measures proposed, 70 percent are approved, with over 

700 measures now in the measure library; 27 percent of those 

measures now are patient outcome measures. Rigorous standards 

are needed so that we don’t misclassify physicians or hospitals, or 

create a misinformed market about providers. Improvement, quality, reduced cost, and informed patients deserve this rigorous NQF 

endorsement. 

For me, ensuring an NQF endorsement process allows for rapid 

inclusion of all interested parties, and avoids the confusion of 1,000 

flowers blooming if too many efforts crowd the measure space and 

lack coordination. 

I seek your continuing support for this rapidly-emerging science 

of health care performance measures with the standards set by the 

NQF. The process is well balanced with experts led by specialty society physicians and input from business groups and patient advocates. The NQF continuously redesigns its processes with strong 

guidance from the medical profession, from those patient advocates, 

businesses, and from CMS. The NQF is the most assured means 

for coordinating all the voices and transforming our national health 

care through measure endorsement, avoiding creating confusion 

from competing standards. 

Thank you for the opportunity to provide testimony to Ways and 

Means Committee. I am happy to answer your questions and elaborate further on any points I have made during my testimony. 

Chairman BRADY. Thank you. 

[The prepared statement of Dr. Opelka follows:] 


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STATEMENT OF DR. PATRICK T. COURNEYA, HEALTH PLAN 

MEDICAL DIRECTOR HEALTHPARTNERS, INC. 

Chairman BRADY. Dr. Courneya. 

Dr. COURNEYA. Good morning, and thank you, Chairman 

Brady, Ranking Member McDermott, and the Members of the 

House Ways and Means subcommittee. I am Dr. Patrick Courneya, 

medical director for HealthPartners Health Plan in Minneapolis, 

serving Minnesota, Wisconsin, and the surrounding states, as well 

as the national network. 

We are a nonprofit, consumer-governed health care organization 

serving more than a million patients and more than 1.4 million 

health plan and dental members. We have nearly 50,000 members 

who are Medicare patients, and one of the nation’s few five-star 

Medicare plans. While we operate a care-delivery system, more 

than 60 percent of our health plan members get their care from our 

contracted network, which includes groups of all sizes. 

We appreciate the opportunity to lend our perspective on this important issue. I also wish to thank the Alliance of Community 

Health Plans for helping to bring our work in this regard to your 

attention. 

At HealthPartners we share the broad goals outlined in the SGR 

repeal and reform proposal. And we strongly support the shift from 

fee-for-service to value-based payment. And we applaud the bipartisan effort in Congress to achieve it. 

In particular, we agree that three phases, those three phases outlined in the proposal, provide a sensible, workable framework for 

developing a viable physician payment system for Medicare. 

Over the past two decades, we and other organizations in Minnesota have used a similar sequence to achieve meaningful 

progress toward performance-based payment reform in our state. 

Minnesota is known for having large, multi-specialty care systems 

and large, not-for-profit health plans. We sometimes hear that 

what works in Minnesota’s market and its structure could not work 

in other markets. We believe strongly that is not the case. The elements of Minnesota’s payment reform are replicable and scalable 

and provide a real-world example for the rest of the country, including Medicare. And, because much of the piloting of this work 

is complete, and powerful tools are already established, we suggest 

that broader implementation could produce results even faster than 

they have in our state. 

I would like to illustrate with a brief example from my own personal experience. I am a health plan medical director, but I am also 

a board-certified family physician with 25 years of clinical experience. By instinct I see performance-based payment through the 

lens of a 13-physician family practice clinic in Minneapolis that I 

once helped to run. Our small practice served a broad range of patients, from affluent middle class to first-generation Hmong, Somali, Eritrean, and Korean immigrants. We accepted a broad range 

of insurance coverage, including Medicare and Medicaid. 

In the 1990s, as we sought to prove our value against larger systems, we responded to the early cost and quality transparency initiatives emerging in Minnesota. At that time, using a paper-based 

system, and supported by bonus payments from health plans and 

a local health-plan-sponsored quality collaborative, our small clinic 


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was able to perform as well as or better than the largest groups 

in our market on clinically-important quality measures. We learned 

just how much improvement is possible if the market signals are 

right and support is present. 

It was an example of a small clinic system serving a diverse population competing on a level measurement playing field with the 

big systems, and doing well. And still today, some of our market’s 

best performers are small, primary-care groups. More important, in 

the past four years these same groups have sustained or improved 

quality performance while working with new total-cost-of-care payment models that drive attention to resource use in an environment of accountability for quality. 

The sequence, quality and experience first, followed by focus on 

efficient resource use, is the right pathway. In our example, our 

communities would not really accept a focus on cost until we could 

demonstrate the ability to improve quality on measures of acknowledged importance to patients and clinicians. Second, until clinicians 

had the skills and experience in quality improvement, they would 

not be able to develop the confidence that they could effectively 

manage costs as these new payment models unfolded. 

As a health plan during the course of 20 years, and in collaboration with our contracted provider community, HealthPartners has 

used a wide variety of tools to support this transition to payment 

models that focus on improving quality and aligning payment to reward those who deliver high quality most efficiently. 

The proposal sequences the transition from current Medicare 

payment models to a similar permanent solution that rewards 

value instead of volume, and, given the scope of Medicare, this 

transition could reinforce the welcome transition already underway 

in the commercial health care finance system. 

In short, the precedent is there, the tools are available, and the 

opportunity for Medicare and the nation’s entire health care system 

is enormous. We are pleased to support this important, thoughtful 

work. 

Thank you again for the opportunity to appear here today. 

[The prepared statement of Dr. Courneya follows:] 


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Chairman BRADY. Doctor, thank you very much. We are joined, 

I should note, by Representative Black and Representative 

Schwartz. Thank you both for your interest. 

Reading through the testimony—I appreciate you getting it to 

the committee well in advance so we could study it—it seems to be 

clear that you are convinced we can base payments on quality 

measures, that getting those measurements right is very important, the collaborative approach in which, you know, a physician 

who is isolated is going to have more trouble than one that is in 

a system that gives them timely feedback so they can—need to 

make the adjustments to quality of care, and that it is important 

that, as we create this formula, we not only reward physicians for 

improving the quality of care, but we also reward them for maintaining a high level quality of care, going forward. 

Let me start with my first question, Dr. Courneya. And I say to 

all of you I like the process that we have taken here, where we continue to share the framework of where we want to go, seek input 

from you in two different rounds of input. I hope that is working 

for physician organizations. I think it is going to create a better 

product at the end of the day. 

Dr. Courneya, you have been doing this for 20 years. Your own 

experience, 13-physician practice. So that would translate to many 

of our communities. One of my concerns is heaping another round 

of quality indicators and paperwork and bureaucracy on top of physicians who are not only struggling with a dramatic increase in paperwork and overhead, separate quality indicators from private insurance, as well. A lot of bureaucracy with electronic medical 

records. 

Can we achieve this without adding more burdens on to local 

physicians? And your experience at HealthPartners, have you focused on the key indicators that matter, rather than a laundry list 

that may have various value? 

Dr. COURNEYA. Boy, we sure have tried to. And I think one of 

the consequences of an engaged and collaborative approach to 

doing this is that the provider organizations in our community, in 

our marketplace, have held us accountable to a commitment as 

health plans in our market to use those agreed-to measures, not 

create the kind of confusion that can occur with HealthPartners, 

Blue Cross Blue Shield and Medica and others in our marketplace 

have little variations on the same general principles. 

We have agreed, as a market, on things like comprehensive diabetes measures, where actually achieving the goals and the clinical 

targets for those patients is the objective. But we all use those 

same measures as the foundation for any quality improvement incentives that we put in place. 

We also think it is important to have both process measures, 

those things that indicate whether or not you are, on a day-to-day 

basis, reliably delivering care in the ways that we know are clinically and scientifically sound, but also outcomes measures that are 

reflective of what is important to patients, as well. 

Chairman BRADY. And that varies, I understand, looking at the 

graph you sent us, that varies by type of medical care provided. Is 

that right? 

Dr. COURNEYA. That is correct. 


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Chairman BRADY. Good. Did physicians within the practice—do 

they have practices where they tend to focus on one or two of those 

types of medical conditions, versus a broad range that would require you to keep up with just a laundry list of indicators? 

Dr. COURNEYA. Well, you know, it has evolved, actually. As a 

primary care physician, we don’t really have the luxury of focusing 

on just one topic, although, as we phased this in, we did get our 

feet wet, we got our skills up to speed, based on, in our case, diabetes measures. Because we could create systems that reliably sustained performance on diabetes, we could then move on to other 

things like cardiovascular disease preventative services, and actually manage a pretty long list, but do so in a way where the systems that supported us in doing that worked well. And we did that 

in a system that didn’t have a big, multi-specialty thousand-member physician group to do it. 

Chairman BRADY. I am not a fan of Washington picking out a 

regional model, injecting it full of bureaucracy, and deeming it for 

the reset of the country. But clearly, your experience shows that 

there is the foundation in place that we can learn from. Is your belief that we can take approaches like yours, and put them in place 

in Medicare in a reasonable time frame? 

Dr. COURNEYA. Yes, I think this is a nice combination of a privately-developed but collaborative approach to doing this work. 

And we do think that one of the real values of that is that provider 

groups could look to the health plans who were driving towards a 

consistent signal in terms of clinical quality, and the kind of incentives that they put in place, and take the risks to make the 

changes that they needed to drive towards better performance on 

those selected measures. Anything that CMS can do in those regions—and I think that those regions exist all across the country— 

to reinforce those signals without interfering with some of that 

work that is going on, would be a delightful translation of that 

work into improving quality for the patients who are served by 

CMS and Medicare. 

Chairman BRADY. Great. I also—actually, I have a boatload of 

questions for all of you. But for the sake of time, let me yield to 

Dr. McDermott. 

Mr. MCDERMOTT. I suspect the chairman and I and all the 

committee have a boatload of questions. 

All of you have said, one way or another, that we are going to 

be involved with the fee-for-service system for quite some period of 

time. It is not going to go away with a snap of the finger. And we 

all know that. So, the question is, how do we make a transition 

that makes sense in the delivery of health care, as well as fiscal 

sense to the United States Congress who is paying for it? That is 

really the trouble, or that is the balance that we are struggling for. 

And I would like to hear from you, because we look at all these 

things and we look at how fee schedules have been developed since 

1992—prior to that, Medicare was fee-for-service, you send in your 

fee and we will send you whatever—then we put in the fee schedule. And since then, we have had this continual question about how 

much we are paying. And I would like to hear from you what you 

think are the best measures by which you decide how much you 

pay. 


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Now, we heard a little bit about the quality—National Quality 

Forum. And the question of whether somebody should set a standard outside and it be applied nationwide, or is it something that 

we let everybody decide on the basis of whether the patients like 

what they—what is the quality standard you are going to use that 

will make the most sense in trying to pay on the basis of quality, 

rather than quantity? 

Because treating a diabetic patient is somewhat different than 

treating a patient—a pediatrician who teaches a mother how to be 

a new mother and breastfeeds and all those things that go on in 

a pediatric office is not the same as adjusting the amount of sugar 

that an endocrinologist does. So how do you set measures that 

make real sense? I would like to hear all your ideas, starting with 

you, Dr. Courneya. You have been trying it. 

Dr. COURNEYA. Yes. Actually, one of the things I would like to 

say about the NQF endorsement process: that tends to turbo 

charge our work, because that lends credibility to the providers in 

our community, so that that is an important part. Total cost of care 

measure that we have in our marketplace is one example of that, 

and that has been a really powerful engagement tool. 

I do think that we need to have the flexibility to be able to understand that different broad categories of providers will have different focus areas where the quality metrics are most important. 

And so, for instance, in pediatric clinics, those kinds of measures 

that reflect effective management of the common conditions in pediatrics, the preventative services that they provide, whereas with 

family medicine it is going to be a different suite of measures. But 

they are all relatively short in number. And for each individual 

specialty, they can be manageable. And we have done that, and we 

have seen it happen in our marketplace. 

I also think it is important—before we can go and give attention 

to total cost of care, as I said in the statement, we need to be able 

to credibly prove that we are paying attention to clinical quality in 

measures that are meaningful. We also have to pay attention to 

issues of access and satisfaction. 

The truth is that it is only through establishing a long-term relationship with my patients that I am going to have the kind of opportunity to have a real impact on their health over time. And both 

clinical quality and satisfaction are part of what cements that relationship over time. And it is important to recognize. 

Mr. MCDERMOTT. Are the data that you get right now from— 

or that Medicare makes their decision, is it good data? Do you 

think we are gathering the right data? 

Dr. OPELKA. Well, so—— 

Mr. MCDERMOTT. It is open to all of you, so jump in. 

Dr. OPELKA. So from the National Quality perspective, we have 

been moving across different data streams. Beginning with claims 

data, it is at least a start to get a certain aspect of performance 

measurement on the table. But as you move through different payment systems, you have to map the different—the quality metrics 

and the goals within that system to different sets of measures. 

As we are moving in the NQF and we look at what is happening 

with clinical data, rather than claims data, with clinical registries, 

rather than non-registry-based data, we move the performance 


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measurement system into a much more robust system. And so, 

moving from a claims-based system for performance measurement 

in the real clinical data drives much higher fidelity in the performance measurement world. And then, if that maps to a payment system, we push those together. 

Dr. HOYT. Yes. I would like to speak to this from the standpoint 

of a surgeon trying to participate in quality assessment for payment, but all of the other things that they need to participate in. 

And what we found is that registry data is critical. Claims data is 

probably inadequate for a lot of the things that, ultimately, they 

need to participate in. 

And, for example, the joint commission requires that you demonstrate that you have ongoing practice performance assessment. 

That is a standard. And to be able to do that, you need to individually credential each physician every two years and a cycle in between. Maintenance certification for board certification requires 

now submission of data based on your practice that is reflective of 

your actual practice, and your qualification to then sit for subsequent examination is based on that kind of data. PQRS, or performance data that could be quality linked, also needs registry 

data. 

So, what we are doing to anticipate that and, really, to your 

question, Chairman Brady, in terms of how to sort of lessen the 

burden for physicians, we are trying to collect data that can be 

used for all of these things, so that in the context of practice, a 

physician is collecting patient data that is relevant to all the regulatory and payment things that they participate in. And it is actually very straightforward. 

So, we have developed, for instance, a physician or a surgeonspecific registry that allows multiple things to be achieved at the 

same time. And it makes it, then, very straightforward. 

Chairman BRADY. Great. Thank you. Mr. Johnson. 

Mr. JOHNSON. Thank you, Mr. Chairman. Dr. Courneya, is 

Medicare and Medicaid paying you when you send in a request? 

Dr. COURNEYA. Yes, they are. 

Mr. JOHNSON. Are they really? All the time? 

Dr. COURNEYA. Well, as far as my business office tells me. 

Mr. JOHNSON. Okay. I am especially interested in your assessment that small practices could do well in your payment system. 

Could elaborate on this point and give some examples? 

Dr. COURNEYA. Sure. That—you know, that is an important 

issue to me, personally. I grew up in northern Minnesota, a small 

community. And so, it is really important to me that solutions that 

might work in a population-concentrated area can find a way to 

translate into small group practices or individual practices. In fact, 

in our marketplace, some of the top performers in clinical quality 

are actually those who are single, solo practitioners, which is, to 

me, a refreshing signal that we are getting it right. 

The way it works, actually, for us, is that those folks in those environments are as engaged in the collaboration around clinical 

quality and learning from others in the marketplace about how to 

change the way they practice. And by supporting them in those 

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I think that those small communities, those one or two-physician 

practices, are actually the ones most burdened by the current feefor-service model in some ways, because the only way their business can get any payment for work that they do is for them to be 

on the treadmill, running as fast as they can. And any alternative 

ways of delivering those care—that care that they may see, they 

can’t do because the payment model isn’t flexible enough to let 

them do that. 

So, we actually think that these kinds of payment models, supported with the kind of infrastructure and the kind of transitional 

support that we have used in our marketplace, can really have an 

impact, both in inner city, concentrated areas as well as rural communities. And we have seen it working. 

Mr. JOHNSON. I am impressed by what HealthPartners has 

done to evolve its payment system to support and reward quality 

of care. I appreciate the description of how you have done it and 

how it works for small physician practices. I realize your system 

must work for physicians for you to have come this far. But I would 

be interested in hearing your thoughts on what a contract physician would say if asked about his or her experience with 

HealthPartners. 

Dr. COURNEYA. Well, there is a couple of things. First, let me 

reflect back on what I first said back in the early nineties, when 

some of this stuff started to march out. 

I wasn’t terribly happy, to be honest. The idea of transparency 

around my performance implied that maybe I wasn’t performing as 

well. What is worse was, when we did actually do that measurement, I found out that I wasn’t, our clinic wasn’t, and, in fact, the 

general community wasn’t performing as well as they thought they 

should. So the early reaction is very similar to many of the things 

that we have heard. 

Right now, I am actually quite proud of the fact that I think that 

we, as a health plan, have really very positive, productive relationships and, in fact, have worked very hard to make sure that financial performance around our contracts reflect a shared set of objectives and a shared stake in success. So, I think that, after that 

time of collaboration, we have had good success. 

Mr. JOHNSON. Well, what did you change to make it better? 

Dr. COURNEYA. Well—— 

Mr. JOHNSON. Because you said you weren’t satisfied with it. 

Dr. COURNEYA. Me, as a physician? Well, first of all, when I 

saw that we weren’t performing as well as we could, we started to 

actually track and understand our patients. All we had was a 

spreadsheet and a paper record. And we used very simple tools to 

track and follow up on patients after they had left the office, and 

help support them. 

One of the things that is important—was important for me to realize, is that sitting in an exam room as a physician, the plan that 

I gave them may not necessarily translate into something that they 

can actually do. So we got much more involved in making sure that 

when we were recommending, we were giving them support to actually be able to execute on. So, by extending our relationship to 

our patients to that period of time between the visit, we were able 


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to make a big difference in the quality outcomes. And we did so 

with very simple approaches. 

I am very excited about the way things are evolving right now, 

because I feel as if the tools to be able to do that in service to our 

patients are just exploding now, and it is a very exciting time for 

that, I think a real opportunity for us to be able to demonstrate 

improved quality at the same time we can pay attention to the 

thoughtful use of the resources. 

Mr. JOHNSON. Great. Thank you, sir. Yield back. 

Chairman BRADY. Thank you. Mr. Kind. 

Mr. KIND. Thank you, Mr. Chairman. I want to thank you for 

holding yet another, I think, very important hearing. I want to 

thank the panelists for your testimony today. 

Dr. Courneya, I have been through your facilities in Hudson and 

New Richmond, and I commend the work that is being done there. 

It seems as if you have been quite successful in being able to marry 

up the quality and the cost metrics, trying to drive for better outcomes at a better price. And listening to your opening testimony, 

too, it sounds as if you believe this is sustainable and can be transferred, broad based, throughout the system. It is not just something 

unique that you are doing, but something that is translatable to 

other areas. Is that true? 

Dr. COURNEYA. Yes, yes. We think so quite strongly. In fact, 

one of my favorite examples is in western Wisconsin. I was on the 

board of directors for the Osceola Medical Center for several years 

and got to know folks there and over in Amery, Wisconsin, as well. 

And as a part of a collaborative framework, a number of the critical-access hospitals got together and decided on how they would 

serve their communities with a cancer treatment center that was 

a shared resource. What that did is it created a resource for treating cancer patients that was shared, that did not duplicate the investment unnecessarily, and produced a rural solution to a very 

real problem that was disrupting the lives of those patients in ways 

that was unnecessary. 

So, I think that is a great example where the model, focused on 

efficient use of resources and high-quality care, can really have an 

application—— 

Mr. KIND. I would love to follow up with you on that. I am cochairing the Rural Health Care Caucus with Kathy McMorris Rodgers, too, and I think the unique needs that exist in rural America, 

too, is something we can’t neglect in that. 

But, Dr. Opelka, NQF. Is that becoming the standard? Are people looking to your organization as the standard bearers as far as 

quality measurements and outcomes? And how are you getting the 

buy-in? 

Dr. OPELKA. Yes. The value of the NQF is the rigor of making 

sure we don’t misclassify. That is the biggest risk when you get in 

this performance measurement business. If the measures aren’t 

adequately tested and they are put out there and we misclassify a 

physician or we misclassify a hospital, we misdirect patients. 

So, it has been a rigorous process, it has been an evolution. We 

have been getting faster at how we do it, which is making the 

standard more usable, friendlier. But it is really that dedication to 

the science and the rigor, so that we avoid misclassification. And 


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we have seen it from measures that have not gone through the 

process where they end up with creating a misguided end result. 

Mr. KIND. Sure. 

Dr. OPELKA. So we are wedded to that as a standard. 

Mr. KIND. And I didn’t hear anyone on the panel mention the 

value-based modifier. It is a work in progress right now through 

CMS. It will be fully implemented by 2017, so it is just around the 

corner here. Does anyone have any thoughts as far as what is going 

on with the value modifier? Concerns with the direction that it is 

taking right now? 

[No response.] 

Mr. KIND. The physician-based value modifier. Dr. Cutler, do 

you know what—— 

Dr. CUTLER. Sure, I know about it. The ACP is not really prepared to object to it at this point. Our position is that payment reform should move towards team-based care. So the value-based 

modifier would not really be necessary if we could get to more of 

a team-based care model. 

Mr. KIND. Right, yes. Anyone else have any thoughts on a physician-based modifier? Dr. Hoyt? 

Dr. HOYT. Yes. I think, you know, the context is ultimately what 

will be selected to be the component measures that judge one specialist versus another specialist, or primary care versus, you know, 

team care might be appropriate for primary care. 

Mr. KIND. Right. 

Dr. HOYT. In some circumstances. But for a surgeon it might be 

your surgical infection rate, your DVT prophylaxis measurement, 

your compliance with bundles of safety in a hospital, so a very different kind of measure set. I mean we see that as really the prototype for how this whole quality linked to payment would actually 

exist. 

Mr. KIND. Right. 

Dr. HOYT. And the details of the VBU are still, you know, being 

worked out, but the concept is to link quality measures to payment, 

and that is, I think, the—— 

Mr. KIND. I couldn’t agree with you more. You know, we see— 

from CBO just a couple of months ago, the recalculation of the cost 

in SGR, they might be fleeting, because they are going to do another recalc this month, I believe. So we will see where they end 

up. We will see where they end up with all of that. 

But it seems that we have got to change the incentives so it is 

value-based, not volume, so that we are paying physicians based on 

the quality of work, and not how much work they ultimately do. 

And, Dr. Courneya, I believe your physicians are salary-based. Is 

that correct? 

Dr. COURNEYA. You know, actually not. 

Mr. KIND. Oh, no? 

Dr. COURNEYA. In our medical group it used to be that way, 

partly as a consequence in the change in the way payment occurred 

over the 1990s and into the 2000s. We did go to a production-based 

compensation. We do have—a substantial portion of that compensation, though, is related to clinical quality outcomes, and we drive 

that into our culture quite deeply. 


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I do think that we can align the incentives properly, we can create a situation where we have shared objectives and shared trajectories, whether we are payer or providers or patients who we are 

responsible for. 

And I do think, also, that as long as the signals are directionally 

consistent, as long as the measures are parsimonious in terms of 

not driving providers crazy, we can create strong, directional market signals that can make a big difference and will actually create 

an opportunity to transform the way we pay for care over the 

course of the—— 

Mr. KIND. I would love to follow up with you and see how you 

are accomplishing that, because—and also how much risk the physicians are actually taking on themselves. 

Dr. COURNEYA. Yes. 

Mr. KIND. But, Mr. Chairman, I see my time has expired. Thank 

you. 

Chairman BRADY. Thank you. Mr. Roskam. 

Mr. ROSKAM. Thank you, Mr. Chairman. Mr. Chairman, we 

have three colleagues on our committee who have one thing in common, and that is they went into medicine as physicians when medicine was attracting the best and the brightest. That is Dr. Price, 

Dr. McDermott, and Dr. Boustany. I kind of have a lot of fun 

lumping the three of those together, and they are not sure if that 

is a compliment. I mean it as a compliment. 

But teasing aside, I come from a family with three siblings who 

are physicians. And what I have observed is that the joy of going 

in to medicine has been—largely been ground out, basically, by 

these larger systems. And it is incumbent upon us, if we are going 

to be dealing with the physician shortage that is looming, we have 

got to figure out a way to bring the joy of medicine back into medicine, and to bring the buoyancy in that sense of healing, as opposed 

to check the box and feeling very defensive about the whole environment. 

There is one statistic that I think it is important for us to be 

mindful of, and that is provided to us by the Association of American Medical Colleges. And they project that we are going to be facing a physician shortage in 2020—which is just around the corner—of at least 91,000 physicians. And that is going to grow in another 5 years, 2025, to 130,000 physicians. 

Dr. Courneya, can you give the committee a perspective of you, 

as a physician and the physicians that you are interacting with, on 

two issues that are sort of looming? One has been sort of well litigated, no pun intended, and one is upon us: that is, defensive medicine, to the extent that it actually drives your behavior and has an 

adverse impact on the doctor-patient relationship; and if the tort liability system were somehow changed, would that create a better 

system? Is it overstated? Is it understated? Can you give us your 

perspective, as somebody who is treating patients? 

And the other is, how significant is the Independent Payment 

Advisory Board that is going to be coming in with the Affordable 

Care Act? Can you give us your perspective? 

Dr. COURNEYA. Sure. A couple of thoughts. First of all, just on 

the best and brightest, I have the great pleasure of actually meetVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00087 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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ing a lot of the new folks coming in. Still attracting them, and that 

is really exciting. 

Mr. ROSKAM. That is good. 

Dr. COURNEYA. I think one of the things that has ground joy 

out of medicine is that treadmill that everybody is on that is in response to the way the market is set up as it exists right now with 

fee-for-service payment. 

With regards to the medical liability, you know, that is also 

something that seems to me to be varying, based on the marketplace. In our own marketplace, liability is not really a very big 

issue. And so, speaking to it from our experience, all I can say is 

that it is not a big part of what is on the table. I can’t speak to 

the way that affects people emotionally in other marketplaces. I 

know it does. And I know that even in our marketplace, it is in the 

back of our mind. 

One thing I would say, though, is that in our experience, well 

supported with information, physicians with the time to have conversations with their patients actually feel a lot less concerned 

about that. And I think also that patients feel a lot less concerned 

about that, as well. It is really the rapid pace and the situation 

that we are in right now, where we don’t have the time to understand the patient’s needs, from their perspective, so that when we 

come up with a plan for care it is properly matched to those needs. 

With regards to the IPAB, you know, I think there is a broader 

question about having available information. And this really comes 

from my perspective as a family physician. There are so many 

treatments out there that I don’t have good information to sit down 

with my patient and make decisions about which ones are the most 

efficient, the most effective, and match them best. So, regardless of 

the source of information, I think we do need, whether it is a result 

of private or public effort, we do need information about how things 

work, one compared to the other. 

As far as the specific solution, I think it is more general direction 

that I am most interested there. 

Mr. ROSKAM. Dr. Williams. 

Dr. WILLIAMS. Thank you. I would like to comment on the concept of defensive medicine. As an imager, it has long been discussed that there are unnecessary tests that are being done in the 

name of defensive medicine, where folks are afraid that if they tell 

a patient, for example, who comes in and asks for a test that, no, 

it is really not indicated, that if something bad happens to that patient, that they will get sued. And so this has been scored by CBO, 

multiple millions of dollars, and that has been going on for quite 

a while. 

We are, as the American Society of Nuclear Cardiology as well 

as the American College of Cardiology, are both in favor of indemnification of physicians for following guidelines that are accepted. 

That is, if we are able to use the appropriate use criteria and be 

able to tell that patient or the physician who is ordering a test that 

this test is really not indicated and we are okay with that, then we 

really shouldn’t have to pay the penalty on the other side for following good guidelines. So we are very much in favor of that. 

Mr. ROSKAM. Thank you. I yield back. 

Chairman BRADY. Great. Thank you. Mr. Blumenauer. 


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Mr. BLUMENAUER. Thank you, Mr. Chairman. I very much appreciate the range of opinions presented here today. And actually, 

the certain coherence about it, in terms of looking forward to something that is a more coherent and effective way to reward effective 

practice of medicine. I think this is something that we need to continue pushing forward on. I have my own personal bias, that the 

cost of this is overstated, because every single year we kick it down 

the road. We are never going to implement the cut to the SGR unless there is a breakdown in the system. So I am, at some point, 

hopeful that we can wipe the slate clean and move forward with 

you. 

I would like to begin, if I could, Dr. Courneya, your—because I 

come from a community in metropolitan Portland, Oregon, where 

I think the practice patterns are very similar to what you enjoy in 

your service territory and particularly in metropolitan Minneapolis. 

Your comments about the difference it makes for people to be 

able to communicate and understand that—in each case I get the 

sense that a lot of people in the medical profession are harried, 

they don’t have the time they want, which leads, perhaps, to default testing for whatever reason. It is one of the reasons that I 

personally have been on a crusade for the last five years to have 

the Federal Government pay physicians or other medical professionals to talk to patients that face end-of-life situations and their 

families, so they know what they are getting into, and that their 

wishes, regardless of what they may be, are enforced. 

I am curious to have your observations about how much time is 

going to be necessary to be able to make this transition using some 

of the indications that you have, and others that we are working 

on, to be able to make that transition from volume to value. 

And maybe, Dr. Courneya, if you could start, and other observations about what the time frame—how quickly could we do this 

right? 

Dr. COURNEYA. Again, I will reflect back on some experience 

in the 1990s, partly to make a point. Again, at that time, with 

nothing but a paper-based system and a spreadsheet, within five 

years we were clearly performing on multiple measures at a level 

that was consistent with our biggest competitors in our marketplace. So we were able to do that with very basic tools and attention to the process, and also with a mental framework that distributed the work for doing that stuff to a broad team, so it reinforces 

the comments that we have heard earlier about team-based care, 

making a lot of those conversations more possible. 

In the context that we are in right now, particularly because 

many markets in this country have learned how to do that, and 

given the tools that we have available now that are much more robust than we had back then, I do think that that three-to-five-year 

time line to building the skills, to be able to demonstrate the ability to deliver on quality, and setting the stage for delivering on 

quality, sustaining that performance, and then giving good attention to resource use, is possible. 

Mr. BLUMENAUER. Within the context of the Affordable Care 

Act. Other observations, gentlemen? Dr. Hoyt? 

Dr. HOYT. Yes, I would like to comment, because I think to really accelerate the pace of what you are asking for, we really need 


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to invest in information systems. And I don’t mean the electronic 

medical record, per se. I mean data registries, data to physicians. 

And we need to then incentivize, in addition to individual physician 

behavior, we need to incentivize collaboration, or physicians working together to common solutions, that come out of the data that 

they examine. Those two elements are really the two major features that lead to change. 

And so, if you can invest in them and incentivize them that is 

what we are seeing with our registries and our collaborators. So 

that when you can get a group of physicians, a group of hospitals 

to work together, they have data that they can review together, 

they will come together and share and move toward a best practice, 

they do it automatically. 

Mr. BLUMENAUER. Doctor—— 

Dr. HOYT. And the biggest inhibition is the finances behind that. 

Mr. BLUMENAUER. Dr. Cutler, did you want to comment? 

Dr. CUTLER. I would just add it is the position of the ACP 

that—the American College of Physicians—there are hundreds of 

practices, thousands of doctors, that have now incorporated teambased care, the patient-centered medical home, into their practices. 

Those practices, because of the team-based nature, can provide the 

services that you speak about. The physicians have the time to talk 

to the patients about the complex nature of their illnesses. And 

other members of the team can also supply medical information to 

them. So, there are enough practices, in the view of the ACP, that 

we could begin implementing these programs and incentives right 

now. 

There are so many different fits that some are ready to go, some 

are two-thirds ready to go, some are one-third ready to go. And it 

is our belief and part of our testimony that as soon as 2014, we 

could roll out these systems, rewarding folks who are more mature 

in the market at a higher percent than those who are halfway 

there, and still allow enough time for the small practices and the 

practices that have not become team-based over the next four to 

five years to develop those team-based models. 

Mr. BLUMENAUER. Thank you. Thank you, Mr. Chairman. 

Chairman BRADY. Thank you. Dr. Price. 

Mr. PRICE. Thank you, Mr. Chairman. And I want to join those 

who are commending the chairman and our staff for putting together this hearing. I think this is extremely important. And I 

want to commend all of the panel members. As a fellow physician, 

it is a hard time for docs out there taking care of patients. And I 

want to commend each of you for what you are doing to try to improve the system and move it in a positive direction for patients. 

Language is important. And a number of folks have used the 

word ‘‘reimbursement’’ for what CMS does to physicians caring for 

Medicare patients. I would suggest that the SGR formula is not a 

reimbursement formula. It is a payment system. And it often times 

doesn’t cover the costs of providing the care. So we are not reimbursing docs for a thing; we are paying them for something, and 

sometimes it works and often times it doesn’t. 

I want to just touch on a different topic, but Dr. Williams mentioned utilizing especially society guidelines as an affirmative defense in a court of law to end the practice of defensive medicine. 


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We have been working on this for a number of years. And thank 

you for that note, and look forward to continuing to work with each 

of you on getting us to a system where we can end the practice of 

defensive medicine, which I believe—and others—wastes hundreds 

of billions of dollars. 

I think it is always important we talk about patients when we 

are talking about health care. And patient access to care right now 

is being compromised, I would suggest, because of the system. One 

in three physicians in this country who are eligible to see Medicare 

patients have decreased or limited the number of Medicare patients 

that they see. One in eight physicians who is eligible to see Medicare patients no longer sees any Medicare patients. This is a system that is broken and is in dire need of fixing. 

So, I want to concentrate on two specific issues. One is flexibility 

and two is the transition time that each of you—I think at least 

four out of five of you—talked about. Dr. Hoyt and Dr. Cutler, I 

would like you to comment on—I think there need to be some pressure valve outlets for docs in the system right now, because it is 

so—often times so onerous and oppressive. One of those is patientshared billing, or balanced billing, or private contracting, voluntarily, outside of the system, and still allowing physicians to stay 

in Medicare and patients to stay in Medicare. Is that something 

that ACS and ACP support? Dr. Hoyt? 

Dr. HOYT. Well, I would say that we support it as something 

that needs to be explored in greater detail, just as you suggest. 

And, you know, I think it may be the right model for certain kinds 

of care. It may be the right model for certain physician elements. 

But it is just not clear, and so—— 

Mr. PRICE. More flexibility—— 

Dr. HOYT [continuing]. I think to talk about it broadly, rather 

than looking—and study it in context that would be the appropriate way to do it. 

Mr. PRICE. Dr. Cutler. 

Dr. CUTLER. My answer is similar. The ACP does support the 

concept. We would like it tested, initially. And we want to determine that patients are protected—— 

Mr. PRICE. Understand the—— 

Dr. CUTLER [continuing]. In a way—— 

Mr. PRICE. Yes, you know, I appreciate. And we look forward—— 

Dr. CUTLER [continuing]. That patient care wouldn’t be compromised. 

Mr. PRICE [continuing]. To working with you on that, yes. 

Dr. CUTLER. But thank you. 

Mr. PRICE. Let me talk about—Dr. Williams. 

Dr. WILLIAMS. Just one quick comment, an inner city doctor 

from Chicago and now Detroit, working in safety net hospitals, that 

balanced billing would actually help us, because there are certain 

patients who would be able to pay the balance and would help us 

take care of the people who are really not able to pay at all. And 

it may not be the intent of the Medicare system to do that, but it 

certainly would help us. 

Mr. PRICE. Thank you, thank you. Now let me switch to the 

transition, because we—most folks have talked about a period of 


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time of transition. I think five years, as many of you have stated, 

is an important period of time. During that transition, though, I 

hope that it is not just a period of time to then impose another formula that again doesn’t work. Shouldn’t we get the quality measures, and all of those things, correct? Shouldn’t that be our goal 

during that time of transition? Dr. Courneya, maybe? 

Dr. COURNEYA. I think the work on the quality goals is an important first step in getting the skills necessary to know that you 

can grapple with problems like that. So, you know, that has to be 

a particular point of attention. 

But I think perhaps balance too, by the fact that in the commercial market some of these shared savings and other alternative 

forms of payment are beginning to unfold, that the five-year time 

frame is one that matches pretty well with what is unfolding in the 

marketplace well right now. 

And so, the idea of being able to pay attention to a resource use 

and grapple with that issue is one that, because of what is going 

on in the private insurance marketplace, physician groups are beginning to build the skills to do that, and they are being able to 

see the value of both that broad view that timely claims information can give, combined with that narrow but deeper view that 

their own medical records can give, as a really good foundation for 

making that transition rather rapidly. 

Mr. PRICE. Dr. Cutler? Cart before horse? 

Dr. CUTLER. If you look at the hundreds of thousands of practices that have gone through NCQA certification, those high-level, 

patient-centered medical homes have built in many quality parameters. So I think some of the data is out there. 

And if you also look at the results of practices that are patientcentered medical homes, we are seeing that hospital admissions are 

down huge percentages, readmissions are down, costs are down. So 

the patient-centered medical home, I think, has built in some of the 

quality measures successfully that you are referring to. And the result is that costs are down. Patient satisfaction and professional 

satisfaction among those physicians is also quite high. 

Mr. PRICE. Thank you. 

Chairman BRADY. All right, thank you. Mr. Pascrell. 

Mr. PASCRELL. Mr. Chairman, thank you for this hearing. And 

each of the participants have been excellent, excellent. 

Mr. Chairman, though, I wanted to clear up one thing that Dr. 

Price was getting into, if I may. From every account that I have 

seen, private contracting threatens the very health of America’s 

senior citizens and people with disabilities. When out-of-pocket 

costs increase, patients will visit doctors less, obviously. These arrangements outside of Medicare would only deter beneficiaries from 

seeking preventative and other care until their illness worsens. 

Now, every report I have seen—and I look at other reports, but I— 

that is my conclusion. So we have heard some specific recommendations. Want to transform—we want to transform the system as it exists right now. 

As you know, Mr. Chairman, in 2009 the Democrats passed a 

permanent fix for Medicare physician payment, H.R. 3961. So I 

think our position is pretty clear. But I must commend you, I must 

commend Ms. Schwartz, and those people who have put some proVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00092 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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posals on the table, because there is a lot of common factors when 

you look at all these recommendations. I hope that we can, with 

your help, get to the resolution. Because this cannot be hanging 

over our heads for the rest of the year or in years to come. 

It is obvious that there is some kind of an agreement that the 

current formula is undermining the Medicare program. It is threatening physician participation and beneficiary access to care. So we 

can’t afford these short-term patches. 

Drs. Cutler and Courneya, many of you know in the reform bill 

we included a national health care work force commission, worked 

very hard on that, to get it into the bill. And associated grants to 

help states improve their efforts to promote an adequate health 

care work force, not only among doctors but also among nurses and 

assistants. We can’t ignore the growing shortages of doctors, 

nurses, and allied health professionals. While payment changes can 

help, there is much more we can do. 

I mentioned we took some very important steps under the Health 

Care Reform Act. Very seldom is it referred to—of course we are 

always dealing with the sexy stuff on the top—and realizing that 

there is a lot of good stuff in there, too. This is particularly true 

when it comes to primary care professionals, and I think you would 

agree with me. 

So, both of you, can you talk about programs that advance primary care practice, if there is anything your organization is doing 

to address health work force issues? 

Dr. CUTLER. Speaking for the American College of Physicians, 

you have touched on something we are very concerned about. And, 

sure, primary care has a shortage right now, and the students and 

the residents, as they come out of training, have huge debt. The 

debt drives their decision away from becoming a primary care doctor. 

So, we are encouraged by any program that lessens that medical 

education debt, whether it is loan forgiveness, working in an 

under-served community somewhere in the country so that the 

debt can go down. And we would encourage more activity along 

those lines. Anything that can be done that would lessen debt, in 

my view, would increase the number of young doctors becoming 

primary care physicians. It is in their heart, they want to do it. But 

they are coming out of training with a mortgage and no house. 

Mr. PASCRELL. Thank you. Dr. Courneya. 

Dr. COURNEYA. Well, I think even at least as important as that 

is that they need to step into practices where there is that joy that 

was alluded to earlier today. 

I had the pleasure of talking before the National Health Policy 

Forum a couple of weeks ago on workforce issues for health care. 

And the reason that I was there was because we have been doing 

quite a bit work to transform that team-based model. And in the 

context of that change, what we have found is that physicians can 

actually see and manage a larger population of patients, they can 

do so well supported by an extended team of providers. And our 

satisfaction in practice within our own medical group from 2005, 

when the only thing that we had that was up in the high area was 

satisfaction with prior authorization process, ironically, has now 

gone from about the 25th to 35th percentile up to the 85th perVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00093 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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centile as a consequence of changing the way physicians work in 

that practice. 

We are now in a position in our own medical group where primary care docs are eager to come to us looking for work, because 

they recognize that joy is possible. And that is what is going to 

draw people into the profession. 

Mr. PASCRELL. Thank you. In conclusion, Mr. Chairman—— 

Chairman BRADY. Thank you. 

Mr. PASCRELL. Mr. Chairman, I just want to bring attention— 

we don’t have—my time has run out—on the specialty area, where 

it is a prolonged illness. And particularly something I worked on 

for a long time, and some of us at the panel, brain injury. And specifically in terms of what we are talking about today, we need to 

take a very, very special look at. And I know the NKF has been 

moving in some direction along those lines. This is a very serious 

problem in our country. Thank you. 

Chairman BRADY. Thank you, Mr. Pascrell. Mr. Buchanan. 

Mr. BUCHANAN. Thank you, Mr. Chairman. This is a very critical hearing. And as we move forward on SGR, I can’t think of anything more important. I think there is a general feeling—I love this 

feeling, the idea, on a bipartisan basis, that we can really deal with 

this once and for all. 

I am in a district in Florida, like many districts in Florida, 70, 

80 percent of the revenues for many of our docs are Medicare-oriented. So it is important. That is the way they keep the doors open. 

In my district alone, 180,000 seniors are on Medicare. So it is a 

very high percentage. But I would say, again, it is not just my district, it is many districts that are in Florida. 

So, I can tell you with our docs, the uncertainty that SGR—this 

has created for them over the last five or six years since I have 

been here is enormous. It is not that we might not get it addressed, 

but they are trying to make capital investments over a period of 

5 or 10 years, and the fact that it is constantly looming over there 

with a 20, 30 percent cut, is huge. 

I would also just say that as someone that has been in business 

for 30 years, there is nothing—and I say nothing—more important 

than getting this right. Because this—the doc here knows that payfor-performance, however you want to measure it and look at it, 

that creates the behavior in the firm. I had 1,200 employees before 

I came here, and the one thing I wanted to get right from the top 

to the bottom is getting that pay plan right. And that is what we 

are talking about right here. Because what you measure is what— 

the behavior you are going to get. 

So, I guess I would ask the docs to start off—just my first—my 

own observation—I think it is very applicable here—is the fact that 

this idea—we have got to make sure we take the time, the thoughtfulness, as much idea as we can get from yourselves and others to 

get this right. And, Dr. Hoyt, do you agree with that? 

Dr. HOYT. Let me give you an example. The way you can take 

data that is developed by registries and use it to effect behavior is 

as follows. If you graph it and put each provider, each physician 

on that graph, there is some on the right that are performing not 

as well as those on the left that are performing better. Those people on the right, when they see that and you make that data availVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00094 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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able to them, by the virtue of their commitment to their patients 

and improving as physicians, they want to move in the direction of 

improving. And so that is why data is such an important and powerful tool to get behavior aligned with, ultimately, quality. 

If you then add to that their opportunity to come together and 

learn from each other, so that the ones that are performing less 

well can learn from the ones that are performing well, then you affect behavior change—— 

Mr. BUCHANAN. Thank you. Dr. Courneya. 

Dr. COURNEYA. Yes. You know, it is really kind of joyful, remarkable acceleration that you see. If the incentives can be properly aligned so that quality improvement—and the measures are 

properly selected so that not only is the incentive aligned, but the 

incentive and the objectives are aligned with the personal mission 

that physicians bring to practice, then you begin to marry that important financial element with what is, I think, a much more powerful motivator, and that is the desire to do well by your patients. 

My mom lives in Florida. The issue of transparency and the 

availability of information for her about what care she can get is 

important to me. And any role that CMS can play in making that 

performance what we can expect across all markets is one that I 

am very excited—— 

Mr. BUCHANAN. Doc, let me ask you, or just in general, W.C. 

Deming said that if you can’t measure it you can’t manage it. And 

I also want to be careful because, at the same time, I have always 

said you can’t measure 48 things. What are the key things that 

need to be considered and measured going forward, you know, for 

docs across the country? 

Dr. COURNEYA. Well, you know, actually, there is one measure 

that I thought was particularly transformational for me in practice, 

and that was the comprehensive diabetes measure. The reason that 

was important is because there were five elements that we had to 

perform on. And it wasn’t just measuring, it was actually getting 

our patients to goal for those five elements. We knew that we 

couldn’t achieve that unless we really changed the way we approached care. 

So, I think that there are certain high-impact measures like that 

that are important. Cardiovascular disease is another one. It is the 

place where the money is. It is also the place where the human suffering is. And so, selecting those in ways that create the kinds of 

force that requires substantial change is really important. 

Those are the two that come to mind. But there are a number 

of others. I would say preventative service is a—— 

Mr. BUCHANAN. Dr. Cutler, I have just got a few minutes. 

Any—your thoughts on either of those questions or observations? 

Dr. CUTLER. It is really tough, is the answer. Every patient I 

see is a little bit different. And so, sure, there are some very common diseases like diabetes, hypertension, hyperlipidemia. But getting down into the weeds on that and listing the specific ones is 

really difficult. 

But I do want to go—come back to a practice that is patient-centered that is a high-level functioning, patient-centered medical 

home, by very definition has many of the quality metrics built in 

to that certification. And those homes are doing quite well in terms 


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of, as I said earlier, hospital readmissions, hospital admissions, cost 

of care. So I think the essence of the answer lies in team-based 

care and certified medical homes. 

Dr. COURNEYA. Right—— 

Mr. BUCHANAN. Thank you, Mr. Chairman, and I yield back. 

Chairman BRADY. Thank you. Representative Schwartz. 

Ms. SCHWARTZ. Thank you. And thank you, Mr. Chairman, for 

holding this hearing and this series of hearings, but particularly for 

this panel. We don’t always have a panel that is so much agreement. So really very pleased to see the consistency of both intention that we should repeal this SGR permanently, and replace it 

with a new payment system that does reward quality and outcomes, improved care, and cost containment. And many of you have 

talked to the fact that we can begin to measure it, and we can do 

this well, and particularly with the kind of work that has been 

done already in delivery system reforms, both in the private sector 

and through Medicare innovation center, Medicare and Medicaid 

innovation center. I thank you for participating in this and really 

getting it done out there in a real world, as we say. 

But how we pay makes a difference, and can either encourage 

this transition and this transformation in the way we deliver care, 

improving health care for Medicare recipients, or not. Makes a big 

difference. I would contend many of you talked about—and I want 

to thank Dr. Cutler, who is here from my district, actually, and 

practices in Norristown, Pennsylvania, lives in my district, and 

ACP has been very, very helpful, as many of you have, in helping 

me write that legislation to create a payment system for doctors 

under Medicare. I hope we get that done. 

There is a lot of agreement and common ground on this. And 

many of you have really articulated what we have to do, which is 

to repeal SGR, provide some stability and updates for physicians, 

focus on primary care—I haven’t talked about that as much, that 

is going to be my question—and really move over the next five 

years to move more physicians—really, the majority of physicians 

in this country—to a system with a variety of models for—that 

could be—really incentivize that kind of quality and value-based 

purchasing of care. So, I thank you for what you are doing and 

moving in this direction. 

I did want to focus on just two things, if I may. You talked a 

good bit, many of you, about—particularly Dr. Courneya and Dr. 

Cutler, thank you for talking a lot about team-based care models, 

particularly about the transitions of care and the—what happens 

to patients when they leave your office or leave the hospital and— 

when you thought you did all the right things and gave them their 

instructions, and, lo and behold, they didn’t all understand them 

and do it all exactly the way you thought they might, and leaving 

out that time. It turns out to be pretty critical, in terms of cost and 

readmissions and care. 

So, I wanted to ask two questions, if I may. And that is if you 

could talk a little bit more—I will start with Dr. Cutler, but think 

Dr. Courneya might want to mention—talk about this, as well—the 

focus on primary care and how important that is to helping enable 

all specialists and all physicians and all primary care physicians to 

actually provide the right kind of care to patients, and the degree 


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to which we have to or should be making sure that we focus on 

both increasing reimbursements and then also just making sure 

that the models that we move forward on actually include primary 

care. That is my first question. 

And then, secondly, about the ability of the system to really move 

in this direction in the next four to five years, and whether we— 

your point about—I would ask you whether we should get started 

right now to make that happen. 

So, both those questions. And, Dr. Cutler, if you would start. 

Dr. CUTLER. Thank you, Representative Schwartz. Obviously, 

we have a huge shortage in this country on primary care physicians. And what is it that patients really want form their doctor? 

Well, they want the opportunity to talk to the doctor. They want 

the time. And the current system, which takes us back, really, to 

the opening comments from Chairman Brady, is that the current 

system is volume-driven. And it de-emphasizes time. So I think the 

solution that we have to aim for is one that rewards the ability of 

the doctor and the patient to sit and talk together, and to decide 

what is best for their care. 

Team-based care, in my view, takes us right to the finish line on 

that. And it does it in a way—and we are seeing it across the country—that is really very cost-effective. Primary care services drive 

costs down. 

Ms. SCHWARTZ. Right. 

Dr. CUTLER. And, obviously, if you are treated for osteoporosis 

by a primary care doctor, your incidence of hip fractures has gone 

down. It is very expensive to take care of a hip fracture. It is considerably less expensive to treat osteoporosis. You can go through 

a whole series of diseases, and many cancers could be cured, discovered very early, and we won’t need all of these expensive 

chemotherapeutic agents and radiation treatments and surgery. 

So primary care is really the answer. It is a financial answer, it 

is an answer for the patients, because they appreciate it. And finally—and this was mentioned earlier—professional satisfaction, 

the satisfaction among the doctors and the members of the care 

team, is the highest of any model. It is considerably higher, and it 

gets away from all of the complaining that doctors do about not 

having time. So, I think the answer lies in patient-centered care 

and team-based care. 

Ms. SCHWARTZ. Okay. 

Chairman BRADY. Thank you. Mr. Smith. 

Mr. SMITH. Thank you, Mr. Chairman, and certainly thank you 

to our panel here today. Just going over some of my notes here, 

and biography statements for our panel here, I see FFS, NSQIP, 

ACS, ASNC, NQF, CSAC. Of course we are talking about SGR in 

a place called D.C. 

[Laughter.] 

Mr. SMITH. But I only mention that because I think it is a reflection of some well-intending efforts of those associated with government to try to create a better situation. And yet, SGR, although 

well-intended, has not been impacting the situation as we would 

prefer. And it is very compelling when I hear that patients themselves—for which there is no acronym description—are seeing reduced access because of the obvious fiscal realities that exist. And 


ralbany on LAP520R082 with HEARINGS
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that is without the next wave of health care reform efforts that I 

already sense are seeing some resistance. 

So, with that said, I also know that we are seeing some consolidation in health care, physicians kind of leaving their independent 

practices to join larger practices, whether or not under hospital 

umbrella or not. And I am concerned that patients may not benefit 

from these changes. 

And so, if you could perhaps elaborate when you take the consolidation issue, whether it is in rural areas or urban areas as well, 

what is the impact with SGR, whether you think it does not have 

any relationship whatsoever or patients should not be concerned or 

providers themselves should not be concerned. If any of you would 

like to, respond. Dr. Cutler? 

Dr. CUTLER. Well, the ACP doesn’t have policy on this. But just 

personally, I have been on both sides of the fence. I was self-employed, I owned my practice for most of my career. Just recently 

I have begun to work for a small hospital network. 

I think the key really lies in the physicians, whether it is a twodoctor group or hundreds of doctors, the physicians being able to 

make the decisions that are best for their patients. So it—in a network like mine, which has a great deal of physician input into the 

decisions that are made from a business standpoint, I feel quite 

comfortable working there. If the physicians are not in charge, I 

would worry about a system like that. 

Mr. SMITH. Dr. Williams. 

Dr. WILLIAMS. Yes. Thank you, Representative Smith. As a 

imager, again, on the hospital side, university side, I have watched 

the influx of physicians that—during this consolidation. And the 

concern is that, as Medicare has decreased payment to the fee 

schedule less than the hospital outpatient payment system, it 

drives people in to a system that ultimately costs Medicare more 

money. It does cost the patient more money to come away from 

their physician to a major facility, in terms of travel and time. But, 

more importantly, it takes away the on-site freedom of practice sort 

of environment that has allowed the imaging to flourish and to 

help people. 

Now, obviously, some things had to be reigned in. There was a 

time when there were—that nuclear cardiology probably sitting at 

this table only because of this—it was the number one Medicare expenditure. That was about 2004, 2005, before the fees were cut dramatically. The volume has gone down, largely because of appropriate use criteria and getting people to certify in their specialty, 

and to make sure that labs were accredited. That was the MMA 

of 2010, that if you are not accredited, you are not allowed to do 

nuclear cardiology and other imaging. 

And so, the quality measures really can impact in a positive way 

how much Medicare spends. Thank you. 

Mr. SMITH. Dr. Hoyt. 

Dr. HOYT. You know, I think, you know, in specialty care, particularly in surgery, we are seeing a trend toward employment as 

one form of this. And when you add to that, then, bundling of payments to entities or systems as a potential reimbursement model, 

you know, you create a—on the one hand, some real advantages so 

that somebody that is part of a bigger system doesn’t have the inVerDate Sep 11 2014 01:47 Nov 08, 2016 Jkt 021108 PO 00000 Frm 00098 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\21108.XXX 21108

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vestment costs in electronic medical records, they may feel less 

burdened by liability in a more protected environment. 

But I think the concerns about being able to perform at a quality 

level are really the same, so that we really need the same tools to 

be able to motivate people to perform quality care. 

Mr. SMITH. Very briefly, Dr. Courneya? 

Dr. COURNEYA. Yes, it really depends on why they are coming 

together. We are going to see examples of groups that come together with the objective of serving patients well and competing in 

an environment where quality and good use of resources is the reward. They are going to do great. We are going to see examples of 

individual, single-physician practices who also do great in that environment. 

We are also going to see examples of people coming together to 

exercise leverage that may not be as good. It really depends on 

their objectives, and whether they are led in a way that is in the 

interest of the patients. 

Mr. SMITH. Very good. Thank you. I appreciate—and certainly 

it is my objective that this panel doesn’t come, or anyone else 

doesn’t come, between you and your patients. 

Thank you, Mr. Chairman. 

Chairman BRADY. Thank you, Mr. Smith. As we wrap up, one, 

thank you very much for all five of our witnesses being here. Your 

experience and ideas are very helpful. 

Dr. McDermott and I had very quick question, very briefly, and 

it goes to the point of if collaboration is important, timely feedback 

is important, a team-type of practice is important, I understand— 

we understand how that works in the Twin Cities. How does that 

work for a rural doctor? How do you fit a rural doctor that may 

have another physician in town? May not be isolated hundreds of 

miles, but in that type—how does this fit for them? 

Dr. CUTLER. The American College of Physicians recognizes the 

difficulty that the doc or doctors in a small community have, certainly with support resources. And it is for that reason that we 

think we need five years to transition into these new models of care 

and payment. 

Thankfully, the Internet exists. A lot can be done through electronic technology. But the fact is that many of these practices are 

one or two doctors. They are on a very tight operating margin, and 

they need time to transition into new models. So we think it can 

be done. We think perhaps the recommendation from the College 

of Surgeons dealing with affinity groups might help the small practices. If given the time, we can make it work. 

Chairman BRADY. Very quickly, Dr. Hoyt. 

Dr. HOYT. Yes. Well, just to add to that, I think we are seeing 

also some exploration of regionalization, which is probably good for 

certain types of patients. And vice versa, larger systems in urban 

areas supporting rural practices to provide them back-up, so that 

they really can feel comfortable practicing in isolation. 

Chairman BRADY. So it can be done. 

Dr. HOYT. Yes. 

Chairman BRADY. Your answer. 

Dr. HOYT. Yes. 


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Chairman BRADY. A reminder, any Member on the panel wishing to submit a question for the record will have 14 days to do so. 

If any questions are submitted, I would ask the witnesses respond 

in a timely manner. 

We are committed to finding a sound solution, permanent solution, reliable solution for the SGR this year, and we are committed 

to working together toward that. 

With that, the meeting is adjourned. 

[Whereupon, at 11:53 a.m., the subcommittee was adjourned.] 

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