U.S. GOVERNMENT PUBLISHING OFFICE

36–533 WASHINGTON : 2019

EXAMINING BARRIERS TO EXPANDING 

INNOVATIVE, VALUE-BASED CARE IN MEDICARE 

HEARING 

BEFORE THE

SUBCOMMITTEE ON HEALTH 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

SECOND SESSION 

SEPTEMBER 13, 2018 

Serial No. 115–166 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

GREG WALDEN, Oregon 

Chairman 

JOE BARTON, Texas 

Vice Chairman 

FRED UPTON, Michigan 

JOHN SHIMKUS, Illinois 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

TIM WALBERG, Michigan 

MIMI WALTERS, California 

RYAN A. COSTELLO, Pennsylvania 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

JEFF DUNCAN, South Carolina 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

RAUL RUIZ, California 

SCOTT H. PETERS, California 

DEBBIE DINGELL, Michigan 

(III) 

SUBCOMMITTEE ON HEALTH

MICHAEL C. BURGESS, TEXAS

Chairman 

BRETT GUTHRIE, Kentucky 

Vice Chairman 

JOE BARTON, Texas 

FRED UPTON, Michigan 

JOHN SHIMKUS, Illinois 

MARSHA BLACKBURN, Tennessee 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

LEONARD LANCE, New Jersey 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILLY LONG, Missouri 

LARRY BUCSHON, Indiana 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

GREG WALDEN, Oregon (ex officio) 

GENE GREEN, Texas 

Ranking Member 

ELIOT L. ENGEL, New York 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

BEN RAY LUJA ́ N, New Mexico 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

ANNA G. ESHOO, California 

DIANA DEGETTE, Colorado 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(V) 

C O N T E N T S 

Page 

Hon. Michael C. Burgess, a Representative in Congress from the State of 

Texas, opening statement .................................................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. Gene Green, a Representative in Congress from the State of Texas, 

prepared statement .............................................................................................. 73 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, preparedst atement ........................................................................ 97 

WITNESSES

Nishant Anand, Chief Medical Officer, Adventist Health System ...................... 4 

Prepared statement .......................................................................................... 7 

Mary Grealy, President, Healthcare Leadership Council .................................... 20 

Prepared statement .......................................................................................... 22 

Timothy Peck, CEO, Call9 ...................................................................................... 25 

Prepared statement .......................................................................................... 28 

Michael Weinstein, President, Digestive Health Physicians Association ........... 37 

Prepared statement .......................................................................................... 39 

Morgan Reed, President, The App Association ..................................................... 47 

Prepared statement .......................................................................................... 49 

Michael Robertson, Chief Medical Officer, Covenant Health Partners ............... 64 

Prepared statement .......................................................................................... 66 

SUBMITTED MATERIAL

Statement of various medical organizations ......................................................... 99 

Statement of the Breaking Down Barriers to Payment and Delivery System 

Reform Alliance .................................................................................................... 101 

Statement of Advocate Aurora Health ................................................................... 103 

Statement of AdvaMed ............................................................................................ 110 

Statement of the College of Healthcare Information Management Executives .. 117 

Statement of the Cancer Treatment Centers of America ..................................... 123 

Statement of the National Association of Chain Drugs Stores ............................ 130 

Statement of Medtronic ........................................................................................... 133 

Statement of the American Society for Gastrointestinal Endoscopy ................... 137 

(1) 

EXAMINING BARRIERS TO EXPANDING INNOVATIVE, VALUE–BASED CARE IN MEDICARE 

THURSDAY, SEPTEMBER 13, 2018 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON HEALTH, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC. 

The subcommittee met, pursuant to call, at 1:15 p.m., in room 

2322 Rayburn House Office Building, Hon. Michael Burgess (chairman of the subcommittee) presiding. 

Members present: Representatives Burgess, Guthrie, Shimkus, 

Latta, Lance, Griffith, Bilirakis, Long, Bucshon, Brooks, Mullin, 

Hudson, Collins, Carter, Green, Matsui, Castor, Luja ́n, Schrader, 

and Kennedy. 

Staff present: Daniel Butler, Staff Assistant; Karen Christian, 

General Counsel; Jay Gulshen, Legislative Associate, Health; 

Brighton Haslett, Counsel, Oversight & Investigations; James 

Paluskiewicz, Professional Staff, Health; Brannon Rains, Staff Assistant; Jennifer Sherman, Press Secretary; Tiffany Guarascio, Minority Deputy Staff Director and Chief Health Advisor; Una Lee, 

Minority Senior Health Counsel; Samantha Satchell, Minority Policy Analyst; and C.J. Young, Minority Press Secretary. 

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BURGESS. We will go ahead and call the subcommittee to 

order, and thank you for your indulgence. We were waiting a few 

minutes because there was another hearing starting downstairs 

and some of our members may be joining us in progress. 

But, for now, the hearing will come to order. I’ll recognize myself 

5 minutes for an opening statement. 

And today, we are convening to discuss a topic that is of significant importance to the healthcare industry at large, and this is the 

ever-evolving transition to value-based care as well as new ways of 

assuming risk and the role technology can play in these efforts. 

Over the course of the last few years, our healthcare system has 

begun a shift toward rewarding physicians for the quality of care 

rather than the quantity, and building off these efforts, providers, 

doctors, health systems, and payers are willing to explore new 

value-based arrangements and open the door to providing new benefits for their beneficiaries. I am certain that many members of this 

subcommittee have taken meetings in their districts on this topic, 

especially in the past couple of years as the shift to value-based 

care has accelerated. 

2 

Notably, Congress passed the Medicare Access and CHIP Reauthorization Act of 2015 in the 114th Congress. For situational 

awareness, this is the 115th Congress, so that was 2 years ago. 

This was a critical step in the right direction as we helped begin 

to shift Medicare towards being a more value-based payment system. We have had other hearings about the Medicare Access and 

CHIP Reauthorization Act including the Merit-Based Incentive 

Payments Systems, conducting general oversight on the implementation of this crucial law. 

A lot of the work that this subcommittee conducts is to oversee 

the influence in the healthcare industry as moving into coordination with the 21st century. The Medicare Access and CHIP Reauthorization Act provided a platform for this effort to do so, and this 

afternoon we are going to hear from a number of people on the 

front lines who are working to deliver better outcomes at lower 

costs. This hearing will provide us with a significant amount of information as we move forward in assessing value-based payments, 

where it holds the most promise, where there may be barriers that 

Congress might consider examining in the future to ensure its success. I think it goes without saying everything we can do to lower 

the burden on physicians, freeze them up to deliver more in-patient 

care and that is the general direction that I think it’s good for us 

to go. 

Value-based care models have been effective and have gained 

support throughout the country as they have proven to improve the 

quality of care and lower costs. This allows for positive outcomes 

for patients, physicians and insurers, as well as the overall 

healthcare system. As we have heard from witnesses at other hearings on this topic, taking these models on as a physician or 

healthcare system can be a difficult but still a rewarding task. 

Promoting innovation and quality are essential to modernizing 

American healthcare and enabling our world-class physicians to 

focus on providing coordinated quality care to their patients. 

Value-based models have evolved over time since their inception 

in the early 1990s, beginning with the efforts among private payers 

and state Medicaid programs to reward improvements in care with 

financial incentives. Models have grown broader and incentives 

more innovative as we have seen accountable care organizations 

and bundled payment programs, which address both quality and 

cost, take off across the country. 

These newer and more advanced models have allowed for physicians and other professionals to voluntarily come together to provide more coordinated care for patients and rewarding physicians 

with bonuses for hitting certain quality measures and based payments on expected costs for specific episodes of care. These models 

are the future of healthcare and it is important that Congress hear 

from the industry about how the implementation of such models 

works on the ground, or to the extent it’s not working it’s important that we hear that as well. 

Today, we have the chance to hear from witnesses about the 

models and ways that they are working to improve the quality of 

care or reducing cost. I suspect we will hear about the critical role 

that the laws we have worked on, including the Medicare Access 

and CHIP Reauthorization Act—the role that they have played in 

3 

expanding innovation, but that barriers to implementing potentially beneficial models still exist. 

So I certainly look forward to hearing the thoughts of our expert 

panel of witnesses about the challenges and achievements in the 

world of value-based care. So I want to anticipate by thanking our 

witnesses for their willingness to testify today. We appreciate being 

able to have this important conversation and learn from your expertise. 

Seeing that the ranking member of the subcommittee is not here, 

the chairman of the full committee is not here, and the ranking 

member of the full committee is not here, perhaps it would be prudent to proceed with witness statements and then we will allow 

those individuals—as they arrive from their other hearing we will 

interrupt and allow them to deliver their opening statements. 

And I do want to remind members that all members’ opening 

statements will be made a part of the record. 

So thanks to your witnesses for being here today and taking time 

to testify before the subcommittee. Each witness will have the opportunity to give an opening statement followed then by questions 

from members. 

Today, we are going to hear from Dr. Nishant Anand, the Chief 

Medical Officer for Adventist Health System; Ms. Mary Grealy, the 

President, Healthcare Leadership Council; Dr. Timothy Peck, CEO 

of Call9; Dr. Michael Weinstein, President, Digestive Health Physicians Association; Mr. Morgan Reed, President of the App Association; and Michael Robertson, Chief Medical Officer for Covenant 

Health Partners. 

Again, we appreciate all of you being here today. Dr. Anand, you 

are now recognized for 5 minutes for the purpose of an opening 

statement, please. 

[The prepared statement of Mr. Burgess follows:] 

PREPARED STATEMENT OF HON. MICHAEL C. BURGESS

Good afternoon. Today, we convene to discuss a topic that is of the utmost importance to the healthcare industry at large, the everevolving transition to value-based 

care as wells as new ways of assuming risk and the role technology can play in 

these efforts. Over the course of the last few years, our healthcare system has begun 

to shift towards rewarding physicians for the quality of care provided, rather than 

quantity. Building off these efforts, providers, health systems and payors are willing 

to explore new value-based arrangements that open the door to providing new benefits for beneficiaries. I am sure many of the members of this Subcommittee have 

taken numerous meetings regarding this topic, especially in the past several years 

as the shift to value-based care has accelerated. 

Notably, Congress passed the Medicare Access and CHIP Reauthorization Act of 

2015 (MACRA) in the 114th Congress. This was a critical step in the right direction 

as we helped begin to shift Medicare toward being a more value-based payment system. We have held various other hearings about MACRA, including the Merit-Based 

Incentive Payments System, as we conduct oversight on the implementation of this 

crucial law. 

Much of the work that this Subcommittee conducts is to oversee and influence the 

healthcare industry in moving care coordination into the 21st Century. MACRA provided the platform for this effort to do so, and today we will hear from people on 

the front lines who are working to deliver better outcomes and lower costs. This 

hearing will provide us with a wealth of information as we move forward in assessing the value-based payments space, where it holds the most promise, and where 

there may be barriers that Congress might consider examining in the future to ensure its success. 

Value-based care models have been largely effective and have gained support 

throughout the country as they have proven to improve quality of care and lower 

4 

costs—boasting positive outcomes for patients, physicians, insurers, and the overall 

healthcare system. As we have heard from witnesses at other hearings on this topic, 

taking these models on as a physician or healthcare system can be a difficult, yet 

rewarding task. 

As a physician and as a Congressman, I believe it is important for physicians and 

health systems to take on risk when it can lead to rewarding outcomes, both for 

them and for their patients. Promoting innovation and quality are essential to modernizing American healthcare and enabling our world-class physicians to focus on 

providing coordinated, quality care to their patients. 

Value-based models have evolved over time since their inception in the early 

1990s, beginning with the efforts among private payers and state Medicaid programs to reward improvements in care with financial incentives. Models have grown 

broader and incentives more innovative as we have seen accountable care organizations and bundled payment programs, which address both quality and cost, take off 

across the country. 

These newer, more advanced models have allowed for physicians and other 

healthcare professionals to voluntarily come together to provide more coordinated 

care for patients, rewarded physicians with bonuses or reductions in payments for 

hitting certain quality measures, and based payments on expected costs for specific 

episodes of care. These models are the future of healthcare, and it is important that 

Congress hear from the industry about how the implementation of such models 

works on the ground. 

Today, we have the chance to hear from witnesses about models that they are 

working on and how there are or could be effective ways of improving quality of care 

or reducing cost. I suspect that we will hear about the critical role that laws we 

worked on, including MACRA, have played in expanding innovation, but that barriers to implementing potentially beneficial models still exist. 

I look forward to hearing the thoughts of our expert panel of witnesses about their 

challenges and achievements in the world of value-based healthcare. Thank you to 

our witnesses for their willingness to testify today. We appreciate being able to have 

this important conversation and to learn from your expertise. 

STATEMENTS OF DR. NISHANT ANAND, CHIEF MEDICAL OFFICER, ADVENTIST HEALTH SYSTEM; MARY GREALY, PRESIDENT, HEALTHCARE LEADERSHIP COUNCIL; DR. TIMOTHY 

PECK, CEO, CALL9; DR. MICHAEL WEINSTEIN, PRESIDENT, 

DIGESTIVE HEALTH PHYSICIANS ASSOCIATION; MORGAN 

REED, PRESIDENT, THE APP ASSOCIATION; DR. MICHAEL 

ROBERTSON, CHIEF MEDICAL OFFICER, COVENANT HEALTH 

PARTNERS 

STATEMENT OF DR. NISHANT ANAND 

Dr. ANAND. Good afternoon, Chairman Burgess and members of 

the subcommittee. I am Dr. Nishant Anand and I serve at Adventist Health System as a Chief Medical Officer for Population Health 

Services and the Chief Transformation Officer. 

We have 46 hospitals located in nine states serving 4 million people each year. This includes Florida Hospital Orlando, which is the 

largest single site Medicare provider and the second largest Medicaid provider in the nation. 

We have accountable care organization arrangements in Kansas, 

North Carolina, and Florida. We serve more than 400,000 patients 

in our ACOs and we partner with several thousand physicians, 

two-thirds of which are independent physicians. 

Additionally, we will participate in the BPCI advanced model 

and are successfully participating in the CJR program. Today, I 

speak to you as a board-certified emergency medicine physician 

and a healthcare professional who has led value transformations at 

Memorial Hermann Health System in Texas and at Banner Health 

Network, which was a pioneer ACO, in Arizona. 

5 

In value-based care delivery, I know firsthand the benefits this 

brings to patients and the barriers that block providers from realizing its full potential. 

We can improve the health and wellbeing of our patients but we 

need policy changes. As healthcare providers, there are many innovations that we would like to undertake that will improve the 

health and wellbeing of Medicare and Medicaid beneficiaries. 

First, we desire to build high value networks that enable 

healthcare providers to ensure high quality care and reduce variation in care. Second, we can expand shared technology services 

across that network. Third, we can develop common operational 

work flows to navigate patients across that complex network. 

Fourth, we can implement clinical pathways across the continuum 

of care—pathways that reward the triple aim rather than fragmented care. 

These four focus areas will help us achieve higher quality and 

more cost effective healthcare. However, barriers impede progress. 

These barriers are Stark Law, misaligned value-based model initiatives, and operational challenges. 

Number one, Stark Law modernization—I am not an attorney 

and cannot speak to the complexity of the law. But as a physician, 

I experience the challenges of the Stark Law each and every day. 

I believe that it causes barriers to doing the right thing for our 

patients. The Stark Law was developed in a reimbursement world 

that paid providers based on the volume of services. 

In today’s world, where ACO providers coordinate care in a highly effective manner, these regulations serve more as a barrier than 

a protection for our patients. 

While HHS issues waivers for APMs, the problem is these waivers are not permanent. Number two, encourage providers to move 

to value. We are concerned that policies contained in CMS’ proposed ACO rule would discourage providers from participating in 

value-based care. 

The existing financial benchmark to specialty and lower cost 

markets make it financially prohibitive to transition to a two-sided 

risk model and will deter providers from participating in the program. If the benchmarks do not provide room for improvement, allowing providers to transition towards value-based care delivery 

over time, providers will not participate. 

Benchmarks must also be accurately risk adjusted. Lastly, the 

proposal to limit shared savings payments from 50 percent to 25 

percent of the savings will create an unsustainable business model. 

Number three, real-life operational challenges—to truly partner 

with private practice physicians, we want to share technology services such as clinical decisions support tools, telemedicine platforms, 

and referral solutions. I know these tools will help us make better 

decisions for patient care that will ultimately lead to better outcomes and lower costs. However, we need clarity that we can share 

these tools with our physicians to use with all patients. We need 

quick implementation of the 21st Century Cures Act. 

As providers are investing in high value networks, we painstakingly work to ensure that our partnerships are with the best providers. As a result, we need to refer our patients more intentionally, making sure that they see the best clinicians, which is 

6 

sometimes at odds with the current Medicare conditions of participation. 

In summary, I ask you to consider a deeper dive into value-based 

reforms that will accelerate our journey. We are ready to go faster 

but need additional help with payment reform, focusing on holistic 

care as well as regulatory reform. 

We need to help ACOs achieve critical mass in order to hit the 

tipping point where value-based care is what we deliver. This will 

allow us to achieve the coordination abilities as a community that 

will better serve our Medicare and Medicaid beneficiaries. 

I thank you for your time and interest and look forward to your 

questions. 

[The prepared statement of Dr. Anand follows:] 

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Mr. BURGESS. Thank you, Dr. Anand. 

Ms. Grealy, you’re recognized for 5 minutes, please. 

STATEMENT OF MARY GREALY 

Ms. GREALY. Good afternoon, Chairman Burgess and members of 

the subcommittee, and thank you for the opportunity to testify 

today on what I believe to be one of the most important topics in 

American healthcare. 

As our healthcare system evolves from a long-standing fee-forserve orientation to a patient-centered value-based approach to 

care, I am proud that the members of my organization, the 

Healthcare Leadership Council, are not only supportive of this 

transformation but have led it. 

Our members are innovative systems such as Adventist health 

plans, drug and device manufacturers, distributors, academic 

health centers, health information technology firms, and all are 

driving change within and across virtually every healthcare sector. 

We appreciate your effort today to shine a light on some of the 

barriers that are preventing an optimal transformation and transition to value-based care that will result in better outcomes for patients and improve sustainability for the Medicare program. 

Today, I would like to focus on several areas that warrant significant attention of this committee. I will begin by saying a word 

about the legal barriers that are keeping healthcare innovators 

from accelerating toward value-based care. 

Let me be clear. We believe it is essential to keep consumer and 

program protections in place while, at the same time, working in 

both the legislative and regulatory spheres to create an open unobstructed pathway for these value-focused activities that benefit 

both patients and the system as a whole. 

The Stark Physician Self-Referral Law and the Anti-Kickback 

Statute were created to prevent overutilization and inappropriate 

influence in a fee-for-service environment in which healthcare sectors and entities operated in their own individual silos. 

Today, however, in order to make the transformation to valuebased care we need greater integration of services, improved coordination of care with cross-sector collaborations, and payment that is 

linked to outcomes rather than volume. 

Adopting these new delivery and payment models becomes difficult when faced with outdated fraud and abuse laws and potential 

penalties of considerable severity. For example, it is desired for 

healthcare providers to achieve optimal health outcomes through 

coordinated care, meeting high quality and performance metrics, 

and saving money through the avoidance of unnecessary hospital 

admissions and office visits. 

And yet, there are obstacles to incentivizing this level of performance. If a hospital wishes to provide performance-based compensation, it can run afoul of the current fraud and abuse framework. 

In fact, in terms of maintaining good patient health, the legal status quo does not even allow physicians to provide patients with a 

blood pressure cuff or a scale to monitor their healthy weight at 

home. 

To achieve meaningful progress toward a value-based healthcare 

system, it is also necessary to address how to foster further success 

21 

in alternative payment models such as accountable care organizations. We know that better care coordination results in better outcomes for patients, which is the goal of accountable care organizations. But we must address the flaws in the current ACO structure. 

Medicare beneficiaries today do not choose to enroll in a particular ACO. Rather, they are assigned to one based on the physician they choose to see. So the accountable care organization is 

charged with the responsibility of managing the patient’s care even 

though the patient is likely unaware they are even under that umbrella. 

Medicare beneficiaries may also not be aware of the benefits of 

this approach. Patients should be proactively informed of the benefits of coordinating care among providers. They should also be encouraged to remain in ACOs and other care delivery models that 

focus on coordination, information flow, and value. Doing so will 

enable these models to better achieve quality outcomes while controlling costs, and also to optimize the effectiveness of ACOs more 

progress needs to be made in data sharing and data interoperability so that entities have real-time knowledge of work flows, care 

coordination, and progress toward quality measures. 

Mr. Chairman, I also need to mention the importance of technology and the movement toward value-based care. Specifically, the 

expanded use of telemedicine is essential to more efficient utilization of healthcare resources, expanding the reach of healthcare providers. 

So we urge Congress and the administration to address Medicare’s restrictions on reimbursement for telemedicine services and 

there’s also considerable value to be found in making digital health 

applications more accessible for beneficiaries. 

And, finally, as we talk about coordinated care, we must focus on 

how we can gain the greatest patient and population health benefits from our healthcare workforce. 

All healthcare professionals must be empowered and rewarded to 

perform to the full extent of their professional license and to be valued members of healthcare teams. 

Thank you again for the opportunity to testify and I look forward 

to your questions. 

[The prepared statement of Ms. Grealy follows:] 

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Mr. BURGESS. Thank you, Ms. Grealy. Thank you for participating with us today. 

Next, we’ll hear from Dr. Timothy Peck. You’re recognized for 5 

minutes, please. 

STATEMENT OF DR. TIMOTHY PECK 

Dr. PECK. Thank you, Chairman Burgess, and please extend my 

gratitude to Ranking Member Green and members of the subcommittee for the honor to speak to you today. 

I am here to share how I’ve seen firsthand how the lack of valuebased care in Medicare fee-for-service system has led to wasted dollars on patient care. 

My name is Timothy Peck. I am an emergency physician and I 

am also an entrepreneur. I went to residency and did my chief here 

at Harvard Medical School and Beth Israel Deaconess and stayed 

on as faculty there. 

I left my career in early 2015 to be an entrepreneur and solve 

a problem—a problem that, in the emergency department, I lived 

every day. Nineteen percent of the patients who arrive in an ambulance to the emergency department come from SNFs—from skilled 

nursing facilities. One out of five patients I saw every day from an 

ambulance came from a SNF. 

Nursing home patients and patients over 65 in general don’t receive great care in the emergency department. Hospitals are not a 

great place to get well for those over 65. Our own data on patients 

in nursing homes shows that 43 percent of patients in SNFs have 

dementia and almost all become delirious from moving them from 

a familiar place to the bright lights of the emergency department. 

In emergency departments we order every test under the rainbow. We put them in the hallway. They get renal failure and bed 

sores. We then admit them to the hospital that exposes them to infections and they often experience post-hospital syndrome condition 

in which most patients leave the hospital worse off than when they 

came in. 

Although I knew this about emergency departments and hospitals because I worked there, I didn’t know anything about nursing homes. I went to medical school. I went to residency, and I had 

never once stepped foot into a nursing home. I needed to understand these patients better and why they were coming to me, and 

so I went and lived in a nursing home for 3 months myself. 

CMS says two-thirds of the transfers are avoidable and 45 percent of the hospitalizations to the hospitals are avoidable for an estimated cost of about $20 billion per year. I needed to understand 

why this was happening. Right now, as of this moment, the only 

way to get paid for this care is to go by what the fee-for-service system says, and that is to put those patients in an endless loop of 

expensive care in which they’re treated in the nursing home at a 

cost, they’re put in an ambulance at a cost, and admitted to the 

hospital at a cost, to go right back into the SNF again. 

I needed to break this loop and, based on my research from living 

in the nursing home, I created a model in which we embed a first 

responder in the nursing home 24/7 who connects to an emergency 

physician by telehealth, who is home, remote, 24/7 whenever 

there’s any type of acute change in condition of that patient. The 

26 

emergency physician who’s home directs the care of that patient 

and decreases hospitalizations by upwards of 50 percent, saving $8 

million per 200-bed nursing home. 

In our first nursing home we’ve served, Central Island 

Healthcare in New York, according to CMS’ own nursing home 

compare website, the percentage of Medicare residents who are rehospitalized after admission to Central Island is 11.1 percent. The 

national average is 22.4 percent. Because of their success on this 

measure, Central Island received the highest possible quality score 

under the new SNF value-based payment program. One of our 

most recent SNFs, Terence Cardinal Cooke in Manhattan, has been 

able to lower its rehospitalization to single digits after full activation of the Call9 model. 

There are 15,600 nursing homes in the U.S. and there are billions of dollars and millions of lives to improve. I, myself, had no 

way of getting paid for the fee-for-service—from the fee-for-service 

system for this type of program, and so we treated 3,500 Medicare 

patients, losing money on every single one, to be able to give you 

the data on—that I just quoted. 

It’s not just us. I know a lot of health systems, providers, and 

entrepreneurs who have amazing ideas. But they are in no way 

incentivized to execute them. 

The only existing option for testing models is CMMI. When 

CMMI is able to succeed, it brings innovation to our patients, 

which they need. However, in the startups world we had a saying 

that in order to learn you need to be flexible and fail fast, fail 

smartly, fail safely, but also fail inexpensively. When CMMI doesn’t 

work, it’s far from inexpensive. 

The other way we can bring innovations to the Medicare program 

is by lifting 1834(m) of the Social Security Act. The issue is that 

the fee-for-service schedule does not create value and lifting 

1834(m) would not protect us from those fees. Changing fee-forservice is the way that we need to move forward. 

Representatives Griffith, Luja ́n, Smith, Black, and Crowley have 

already championed a new approach, the RUSH Act of 2018. What 

this does is allows Medicare to avoid the $20 billion being spent on 

unnecessary hospitalizations and a novel approach in which providers can have value-based contracting instead of following the 

fee-for-service schedule. RUSH Act is the tip of the spear creating 

value-based contracting by supporting a program that has shown 

to increase quality and decrease costs. 

The bill is set up in a way that when savings happen, providers, 

nursing homes, and Medicare share in the potential savings. It’s 

also set up in a way that providers get kicked out of the program 

if they don’t save money or increase quality, which is how valuebased care should be set up. 

You can be the change agent. You can be the reason why we 

saved Medicare program, not only for the $20 billion being spent 

on nursing home patients, the billions being spent on unnecessary 

services every year. 

The faster this happens, the less lives are lost and the more 

money that is saved. 

27 

Thank you to the committee and Congressmen Griffith and 

Luja ́n for introducing the RUSH Act. It’s the first step to bringing 

value to Medicare. 

[The prepared statement of Dr. Peck follows:] 

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Mr. BURGESS. Thank you, Dr. Peck. 

Dr. Weinstein, you’re recognized for 5 minutes, please. 

STATEMENT OF DR. MICHAEL WEINSTEIN 

Dr. WEINSTEIN. Chairman Burgess and members of the subcommittee, thank you for inviting me to testify regarding the importance of removing barriers to value-based care in Medicare. 

I am Dr. Michael Weinstein, a practicing gastroenterologist and 

President of Capital Digestive Care, an independent physician 

practice. I am also President of the Digestive Health Physicians Association, which represents 78 GI practices across the country. 

Independent physician practices provide high quality, accessible 

care in the community at much lower cost than identical services 

in the hospital setting, yet value-based arrangements are generally 

not available to us. Physician practices are facing increasing challenges competing with mega-hospital systems that are favored by 

antiquated Medicare law and regulations. 

Hospitals recently embarked on a buying spree of physician practices. The number of physicians employed by hospitals increased 50 

percent from 2012 to 2015. This has impacted costs, as hospitals 

seek to recoup their investments by capturing highly profitable ancillary services. These are the same designated health services that 

are regulated by Stark self-referral law. Despite some reforms, significant disparities for high-volume services persist. For example, 

Medicare pays nearly twice as much for colonoscopies in the hospital outpatient department as in an ASC. There is no clinical reason that nearly half of the 2.7 million colonoscopies continue to be 

performed in the more expensive setting. 

Policy makers should be doing more to encourage robust competitive market that allows independent practices to compete and deliver value-based care. Targeted policy changes will improve patient care and lower costs. Congress and CMS must improve the 

system the develop, evaluate, and approve alternative payment 

models. 

A couple of years ago, CMS projected that 10 to 20 percent of 

physicians would be enrolled in an APM. Today, that number is 

just 5 percent. 

PTAC was created to facilitate and recommend physician-developed APMs. It has examined 26 APM submissions with five recommended for implementation and six for limited scale testing. But 

CMS has yet to implement a single APM recommended by PTAC. 

Moreover, many stakeholders have refrained from submitting proposals because they cannot test them first. 

The Medicare statute permits HHS to waive the Stark and other 

fraud and abuse laws on a case by case basis only for approved 

APMs. It does not allow testing. For example, PTAC recommended 

for pilot testing Project Sonar, an APM designed to promote coordinated care for patients with chronic inflammatory bowel disease. 

But that testing could not occur under the statute without explicit 

approval of CMS. This means that both clinicians and policy makers lack data to determine if the APM worked or if modifications 

should be considered. 

Also, access to affordable utilization data is needed to model and 

develop innovative payment arrangements. CMS charges $4,500 for 

38 

one year of data from the HOPD and ASC setting, making multiple 

years of trend data cost prohibitive for many. Deidentified utilization information should be available to the public, researchers, and 

stakeholders for free on a public website. 

The ACA created waivers from the Stark and fraud and abuse 

laws for ACOs. This creates an uneven playing field for independent practices that would like to participate in value-based arrangements but cannot. We do not advocate amending the Stark 

self-referral laws in the context of fee for service. But we do think 

the law needs to be modernized to encourage participation in 

APMs. 

Explicit prohibitions on remuneration for value or volume make 

no sense under at-risk arrangements that limit Medicare cost exposure. Practices must be able to incentivize appropriate physician 

behavior for adherence to recognize treatment pathways. How can 

Medicare promote value-based care if physicians are explicitly prohibited for paying for value? 

Finally, patients need better and more accessible information 

about their treatment options. For example, under the law, screen 

colonoscopy is covered regardless of where it is provided and the 

patient has no co-pay and patients have no idea that there is a substantial hospital versus ASC cost differential. 

Similarly, patients should be able to access uniform quality and 

patient outcome metrics across sites of service for identical procedures. 

Solutions are available and achievable. DHPA has joined 24 

other physicians organizations in endorsing the Medicare Care Coordination Improvement Act. That bill would provide the secretary 

the identical authority to waive statutory impediments for physician-focused APMs as provided to ACOs. 

It would also repeal the volume and value prohibitions for physicians participating in APMs and permits testing of formerly submitted models while they are under review by CMS. Enacting such 

improvements would dramatically increase physician participation 

in value-based care. 

We look forward to working with the committee on these ideas 

to strengthen the Medicare program, improve patient care, and 

conserve resources. 

Thank you. 

[The prepared statement of Dr. Weinstein follows:] 

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Mr. BURGESS. Thank you, Dr. Weinstein. 

Mr. Green, we went ahead with opening statements from the witnesses, and if it’s all right with you, we’ll conclude our last two and 

then I will recognize you for an opening statement, if that’s agreeable to you. 

Mr. GREEN. Mr. Chairman, I will just submit my opening statement for you and I apologize for being late. 

Mr. BURGESS. That’s not a problem. I know that there’s a lot 

going on today. 

Mr. Reed, you’re recognized for 5 minutes for an opening statement, please. 

STATEMENT OF MORGAN REED 

Mr. REED. Thank you, Mr. Chairman. 

My name is Morgan Reed and I am the President of the App Association and Executive Director of the Connected Health Initiative—a coalition of doctors, research universities, patient advocacy 

groups, and leading mobile health tech companies. 

Our organization focuses on clarifying outdated health regulations and encouraging the move to value-based care through the 

use of digital health tools to improve the lives of patients and their 

doctors. 

Demographics are set to overwhelm the Medicare system with, 

roughly, 70 million Americans enrolled by 2030. Yet, physicians 

and their teams are already reporting being overworked and 

burned out. Moreover, patients report a high level of frustration 

with the healthcare system. It simply takes too long and costs too 

much. And yet, this is the same world where every person can pay 

their mortgage, monitor their package delivery, review their child’s 

homework, all while sitting in the waiting room of that very doctor. 

What’s going on that we can’t better engage with patients using 

the tools every single one of you has in the palm of your hand right 

now or strapped to your wrist? Why is it that CMS reimburses 

nearly a trillion dollars a year, yet can’t use those technologies to 

cover telemedicine in a meaningful way? Why doesn’t the system 

help doctors use tools that lower administrative burden, allow doctors to treat a patient and not the keyboard? 

Well, since I don’t want to leave this committee in a state of depression—a condition, by the way, that has been proven to be treatable using digital patient engagement tools—I want to lay out what 

we see as the key questions to be asked and the pathway forward 

for our sector. 

First—the first question we should always ask in this case is 

does the policy decision drive value for patients. Medicare beneficiaries—wait a minute, let’s call them what they really are—people, who live in their districts, or better yet, how about—let’s we 

call them constituents—have a simple goal. 

They want to be healthy and they want to be independent, and 

for those with chronic conditions like type 2 diabetes they want 

treatment to help them stay as healthy as possible for as long as 

possible. For them, remote monitoring technologies are lifesaving 

tools. 

One of our member companies, Podimetrics, is one such remote 

monitoring company. They make a foot mat that detects diabetic 

48 

foot ulcers up to 5 weeks before they become clinically present. 

This tech is not only more efficient than other methods but it also 

cuts down on hospital bills and ultimately saves limbs. Doctors like 

it because they stay engaged with the patient. But reimbursement 

under Medicare remains a question mark. 

Second question—does the policy decision drive value for care 

givers? We are all familiar with the horror stories from physicians 

on EHR adoption and the epic burnout we see as a result. Patients 

rightfully complain that physicians seem disengaged when they’re 

typing away at a keyboard. Meanwhile, doctors find they must subvert the system by typing asterisks or other characters in a field 

they don’t use. This not only creates extra work for them but ultimately will prevent entered data from being used predictably as 

part of machine learning or augmented intelligence systems. 

And finally, does it drive value for taxpayers? Taxpayer value 

comes from a system that incentivizes the right things at the right 

time. 

When it comes to preventative health, this begins with expansion 

of the CBO scoring window. I want to thank all of you who supported the Preventative Health Savings Act—H.R. 2953—which 

would expand this window to 10 years. That’s a good start. But 

preventative medicine can do much more. 

For example, my friend, Congressman Harper, knows full well 

that the University of Mississippi Medical Centers’ telehealth program would save the state $189 million in Medicaid if just 20 percent of Mississippi’s diabetic population were enrolled. 

Just think of the taxpayer savings for the country if CMS supported what UMMC is doing today. And here are a few actions that 

Congress and the administration can take to hit the mark. First, 

Congress should pass the Connect for Health Act—H.R. 2556—to 

clarify that Medicare covers tech-driven tools that enhance efficiency and clinical efficacy including the removal of the outdated 

restrictions under 1834(m). 

Second, for practices that still use the fee-for-service model, CMS 

should adopt billing codes that cover activities that use patientgenerated health data and remote patient monitoring. CMS has 

done good work in unbundling CPT Code 9091 and the proposed 

new code CBCI(1) and CMS should continue to look at the ways 

that the Digital Medicine Payment Advisory Group can develop future codes that support new technology. 

Third, Congress should file down regulations like the Anti-Kickback Statute in the Stark Law to allow providers to get technology 

into the hands of patients. And finally, Congress should support 

the use of unlicensed spectrum, sometimes known as TV White 

Spaces technology to help cover rural populations so they can have 

high-speed internet in places traditional carriers don’t cover cost effectively. 

I want to remind everyone here that we all are or will be part 

of the system, either as patient or caregiver. The least we can ask 

is for the system that treats us and the care teams that see us as 

real people, not just boxes on the spreadsheet. 

Thank you very much. 

[The prepared statement of Mr. Reed follows:] 

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Mr. BURGESS. Thank you, Mr. Reed. 

And Dr. Robertson, you’re recognized for 5 minutes, please. 

STATEMENT OF DR. MICHAEL ROBERTSON 

Dr. ROBERTSON. Chairman Burgess, Ranking Member Green, 

and members of the subcommittee, thank you for the opportunity 

to testify on behalf of the National Association of ACOs. 

NAACOS is the largest association of accountable care organizations representing more than 6 million beneficiaries through more 

than 360 ACOs. I share my perspective as a practicing internal 

medicine physician since 1986 and currently as Chief Medical Officer of Covenant Health Partners and Covenant ACO in Lubbock, 

Texas. 

Covenant Health Partners formed in 2007 and we have had a 

clinically-integrated network for 11 years now. Through our network we have instituted robust health information technology, contracts for hospital services, and quality metrics for measures like 

hospital-acquired infections. 

We then branched out to commercial contracts and in 2014 made 

the quantum leap to a 3-year Track 1 Medicare Shared Savings 

Program agreement. If we had not already had a clinically integrated network in place where we had already done much of the 

work to get ready for MSSP participation, it is unlikely we’d have 

made the decision to participate in the MSSP. 

It is also important for us that we didn’t have to be concerned 

about taking downside risk since we were in a share savings only 

model. We learned that moving to value-based care is a massive 

undertaking that requires changing the behaviour of multiple providers. 

We’ve had to change physician behavior, hospital behavior, 

skilled nursing facility behavior, home health agency behavior, and 

the list goes on. In looking at our MSSP financial data we came 

to understand that much of our cost was coming from post-acute 

care, namely, skilled nursing facilities whose costs are 180 percent 

higher and home health agencies whose costs were 250 percent 

higher than national normative data. 

We had to work closely with those providers to see costs go down 

and that took time and effort. By developing and working with providers in our preferred post-acute care network, we eventually got 

to a place where we have seen quarter by quarter decreases in 

costs in these areas. 

Participation in the MSSP has allowed us to reinvest in technology and infrastructure to manage our patient population. In our 

first year of participation in the MSSP, we saved Medicare $5 million and our share of that was $2.5 million through the gains sharing arrangement. 

We used the bulk of those funds to reinvest in our IT infrastructure and developed a physician dashboard for quality data such as 

adhering to evidence-based practices for chronic disease management and preventative care like pneumococcal vaccines and 

colonoscopy for our patients are displayed. 

We also invested in an analyst to review and manage our financial and quality data. One challenge we’ve had there is that finanVerDate Nov 24 2008 14:17 Jun 07, 2019 Jkt 037690 PO 00000 Frm 00070 Fmt 6633 Sfmt 6633 U:\MY DOCS\HEARINGS 115\HEARINGS\115-166 CHRIS
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cial data for Medicare is only available on a quarterly basis and 

then we receive that data some 4 to 6 weeks after that. 

So any change in our process can be delayed. We also hired care 

coordinators and invested in software to manage care. We now receive real-time alerts through our care coordination system when 

our patients arrive at the emergency department that allow us to 

push a care plan for the patient to the emergency room physician 

so that he or she isn’t working blind and can assist us in providing 

high-quality cost efficient care. 

All of these things take time and money. Pushing too quickly to 

achieve results and take on risk without giving ample time for providers to develop the necessary infrastructure will mean providers 

will not participate. 

In year one of our Track 3 agreement, we ended up with a small 

profit. But based on early actuarial work, at one point we thought 

we would have to repay CMS $1 million to $4 million because that 

financial reconciliation for the MSSP was is delayed by about 8 

months after the contract ends. Had my physician board of directors been told they would even have to pay back $1 million, there’s 

no way that we would have continued participation in the MSSP. 

From a provider perspective, it doesn’t make sense to assume financial risk to take care of Medicare patients as this entails accepting responsibility for costs the physicians cannot control such 

as the increasing costs of pharmaceuticals like chemotherapy. 

I think CMS has had some very positive changes in the new proposed rule. The expansion of the 3-day SNF waiver and the increased stability in the rule are both great improvements. 

I do have significant concerns about the speed at which the agency is asking people to move to risk though as well as the proposal 

to cut shared savings from 50 percent to 25 percent. 

Two years is not enough time to take on risk. It took us 11 years 

and we are still hard at it, and the reduced shared savings amount 

is going to keep providers out of this program because it doesn’t 

allow them to retain enough savings to reinvest in the IT infrastructure and care coordination that is needed to make these programs work. 

Furthermore, the limitation of the risk score adjustment between 

positive 3 percent and minus 3 percent over an entire 5-year contractual period will also be harmful as it will penalize physicians 

financially for taking care of patients who are sicker. 

I commend this committee on its work to examine ways to increase the use of value-based models and arrangements in the 

Medicare program. 

Thank you for the opportunity to testify. 

[The prepared statement of Dr. Robertson follows:] 

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Mr. BURGESS. And thank you, Dr. Robertson, and thanks to all 

of our witnesses for spending time with us this afternoon. 

Mr. Green, I will once again offer to recognize you for an opening 

statement. If not, we’ll go directly to questions. 

Mr. GREEN. I think we’ll go directly, and I ask unanimous consent to place my statement into the record. 

Mr. BURGESS. And without objection, so ordered, and—— 

[The prepared statement of Mr. Green follows:] 

PREPARED STATEMENT OF HON. GENE GREEN

Good afternoon and thank you all for being here today. 

Today’s hearing is titled, ‘‘Examining Barriers to Expanding Innovative, ValueBased Care in Medicare.’’ 

I want to thank the Chairman for having this hearing and I thank all of our witnesses for joining us today. 

Today’s hearing focuses on the current transition in the Medicare Program away 

from fee-for-service and towards a value-based payment system that is centered on 

the patient. 

One of the main ways the Affordable Care Act sought to reduce healthcare costs 

is by encouraging doctors, hospitals and other healthcare providers to form networks 

that coordinate patient care and become eligible for bonuses when they deliver that 

care more efficiently. 

ACA took a carrot-and-stick approach by encouraging the formation of accountable 

care organizations, or ACOs, in Medicare. 

Today, there are 472 ACOs operating in the United States, caring for 9 million 

beneficiaries. 

In 2015, our committee passed the Medicare Access and CHIP Reauthorization 

Act (MACRA), which expanded on the ACA to further encourage the use of valuebased compensation by encouraging providers to create incentives to participate in 

new care delivery models that increase quality and reduce costs. 

Starting next year, Medicare providers must participate in either the Merit-Based 

Incentive Payment System (MIPS) or an Advanced Alternative Payment Model. 

Both options are value-based systems. This has led providers in recent years to 

adopt new care delivery systems. 

Studies have shown that value-based care systems lower costs to the overall 

health system while improving patient outcomes, a win-win that everyone should 

support. 

ACOs saved Medicare an estimated $1.1 billion in 2017, with a net savings of 

$314 million after bonuses were paid out. This is a significant improvement over 

previous years and a clear sign that ACOs are succeeding as intended. 

Additionally, the experience with the Shared Savings Program has shown that 

ACOs do better over time, both in terms of performance on quality measures and 

at generating savings, as they gain experience with care transformation. 

Studies have shown that ACOs have reduced readmissions from skilled nursing 

facilities, generated fewer emergency department visits and hospitalizations, and 

had less Medicare spending overall relative to comparison groups. 

I am concerned with the proposed rule the Centers for Medicare & Medicaid Services (CMS) issued on August 17 that would shorten the onramp for new ACOs to 

take on downside financial risk from 6 to only 2 years. 

I am also concerned that the proposed rule cuts shared savings in half for certain 

ACOs from 50 percent to 25 percent. 

I am looking forward to hearing from our witnesses who have managed or have 

experience with ACOs on their views on the proposed rule and whether this proposal may be harmful to current and new entrants. 

I know some stakeholders are interested in making changes to the Stark Act and 

AntiKickback statute. I agree that Congress should be open to revisiting current 

laws if these regulations are bona fide barriers to value-based care. 

However, the Stark Act and Anti-Kickback statute were put in place to protect 

patients and taxpayers from potential abuses, including subjecting patients to unnecessary testing and referring patients to lower quality services. 

According to the Government Accountability Office last year, improper payments 

in Medicare accounted for $51.9 billion. The Stark Act and Anti-Kickback statute 

continue to serve important roles in protecting taxpayers from waste, fraud, and 

abuse. 

74 

Any effort to reexamine these laws must place the importance of protecting patients and taxpayers from excessive costs and abuse at the top of the priority list. 

Thank you again, Mr. Chairman, for holding this hearing, and I yield the remainder of my time. 

Mr. GREEN. I will share it with all of you all. You can read it 

on the way home. 

[Laughter.] 

Mr. BURGESS. The chair would remind all members that all 

members’ opening statements will be made part of the record, filed 

following Mr. Green’s missive. 

So I will recognize myself 5 minutes for questions and, Dr. 

Weinstein, thank you for being here. You represent I guess what 

we would describe as independent physicians. Is that a fair assessment? 

Dr. WEINSTEIN. Yes, independent gastroenterologists—about 

1,900 across the country. 

Mr. BURGESS. So you raised the issue of independent physicians—the difficulty they might have in accessing the alternative 

payment model and being able to participate in that. 

Could you just kind of go over what are the major obstacles for 

the independent physician to be able to participate in an alternative payment model? 

Dr. WEINSTEIN. Yes, certainly. Thank you. 

Independent physicians, particularly sub-specialty physicians 

take care of chronic disease. We don’t do primary care. We are used 

when a patient needs a particular service or has a particular disease. 

So in a standard ACO type APM, we are technicians, in general. 

But an independent practice like ours takes care of a lot of patients 

with chronic inflammatory bowel disease, chronic liver disease. 

These are very high cost, high beta, high variable cost patients that 

generally are managed—even their primary care is managed by 

gastroenterologists. 

In developing an alternative payment model for inflammatory 

bowel disease, we grouped. Our association got together and used 

actuaries, did the data analytics using our own data to determine 

what a model to take care of patients over a long period of time 

would be. 

Project Sonar was that APM. It was actually the first APM presented to PTAC when PTAC started. It received a tentative approval for testing and then got stuck. It does use technology to engage patients in their own care so that we could do outreach and 

try and identify patients before they show up in the emergency 

room, before they show up in the hospital. 

So the difficulties in developing that APM, obviously, there was 

a cost burden in getting the actuarial data. There was an inability 

to test to model because of the Stark prohibitions and then not 

knowing how to modify it, obviously, it makes it difficult. 

So we are sort of shut out of APMs as gastroenterologists because we don’t have any alternative payment models that we can 

participate as independent physicians. 

But we are very willing to invest in the technology to do that. 

Mr. BURGESS. Sure. If we can overcome some of those obstacles 

and those obstacles would be what you just delineated. I may get 

75 

back to you in a written question form about PTAC because I’ve 

got a particular sensitivity to that. PTAC was a creation of, basically, this subcommittee a couple Congresses ago and, conceptually, 

PTAC was there so that physicians would be back in charge of 

quality metrics as opposed to leaving that all up to the agency. 

So it is very important to me the PTAC work and I am discouraged to hear that you’re having trouble. So I may follow up with 

you on that because I do feel that it’s such an important concept. 

But Dr. Anand, let me just ask you, in moving to downside risk 

models to allow a system like Adventist to integrate independent 

physicians into your networks, is that a possibility? 

Dr. ANAND. Great question, Mr. Chairman. 

From a philosophical perspective, two-thirds of our clinically integrated networks are independent physicians, and so we have always approached with the philosophy that we want to have the 

best clinicians to be part of our networks. 

Sometimes it’s the best employed physician. Sometimes it’s the 

best independent. But we hold ourselves to high standards. We 

want physicians who are going to be focused on quality at the best 

experience at an efficient cost. 

So with that, as we transition into the post-MACRA world and 

being part of an advanced APM becomes more important to our 

independent physicians, we’ve seen that as a great way for us who 

are in a Medicare shared savings model to align with our physicians who are going to be either subject to a penalty or a possibility 

of a bonus in the MIPS program or, alternatively, who are interested in taking more holistic care in moving towards an advanced 

APM model. 

So MACRA is one of the big opportunities that’s going to allow 

us to partner with their physicians. Too, taking downside risk allows us to coordinate care more across the continuum with the 

waivers that are present, with the ability to bring in more components of the delivery system. 

We talked a lot about post-acute. We talked about our specialists. 

Bringing all those providers together in the—and some are going 

to be independent, some will be academic, some will be employed— 

that’s going to allow us to coordinate care more holistically. 

It’s also going to allow us to share tools and technologies to 

achieve that coordination—sometimes apps, sometimes EMR-integrated tools that are going to be part of it. There’s an upside potential that could also be—if the ACO is successful that’s also going 

to be an attractive component for the physicians as well. So there’s 

several components. In my mind, I think the MACRA component, 

especially as we transition into the later years of the MACRA 

model into the advanced APM model I think there’s going to be a 

lot of synergies with independent physicians. 

Mr. BURGESS. And I just want to address for you, since you 

brought up the interoperability title of 21st Century Cures, the 

oversight of the implementation of 21st Century Cures has been 

front and center in front of this subcommittee because the scientific 

aspects, the FDA NIH aspects. There was actually a mental health 

title. 

So we’ve had separate hearings on both of those and the third, 

of course, was the interoperability title, which I thought deserved 

76 

its own oversight or its own subcommittee implementation hearing. 

Because of the delay from the rule coming from the office of the national coordinator I was actually talked into postponing that last 

June. 

In retrospect, perhaps we should have pushed again with the 

hearing. But and, obviously, we are up against some other things 

in the calendar which you may have heard about in the papers. 

But at some point this year, I intend to have that interoperability title implementation hearing that you said would be critical 

for you. 

Mr. Green, I recognize you 5 minutes for your questions, please. 

Mr. GREEN. Thank you, Mr. Chairman, and I thank you for your 

effort to make the system work. 

Dr. Weinstein, about 2 weeks ago I was invited to speak to the 

gastroenterologists in Houston, Texas, and I was surprised after I 

got up and talked about MACRA and how we are trying to stay attuned to it as members of Congress, watching what the agency 

does. 

At the end of it, which is not usual, I didn’t have any questions 

at all. So I wasn’t sure that the physicians were aware of what’s 

going on. 

Have you seen that? And that’s not just one specialty. That was 

just one I happened to speak to a while back. 

Dr. WEINSTEIN. I think the largest physician groups around the 

country have their ears to the ground as to what’s happening with 

MACRA and MIPS. In a gastroenterology practice it’s unfortunate 

that there really isn’t a way for us to participate in APMs and we 

are looking at having to implement MIPS, which is a very expensive way to gather data and a very inefficient way to gather data 

and yet it has never been proven to help patient care. 

So I think smaller groups are unaware of what’s happening. I am 

not sure—— 

Mr. GREEN. Although in the Houston area we should have a 

whole lot of gastroenterologists. 

Dr. WEINSTEIN. There’s some very large groups in Houston. I am 

familiar with a couple of them. 

Mr. GREEN. OK. 

Dr. Robertson, welcome to our committee. The chair is from 

north Texas. I am from Houston, and, obviously, we speak the 

same language, coming from Lubbock. 

Can you speak for a little more on your organization’s initial decision to transition in the ACO model and why this model was the 

best fit for your organization? 

I think you answered some of that. You were already on that 

road that you thought the ACO would work. 

Dr. ROBERTSON. We were on the road because we had already 

gone into Track 1 in 2014. We were making a decision as to whether we wanted to participate another 3 years in Track 1 or move to 

a different model when a law called MACRA became on our horizon, and like many things in life, timing is everything. 

This was fortuitous timing. We looked and the more we began to 

discover about MACRA, the more we knew we wanted to be qualifying providers under an advanced APM as opposed to being 

thrown in the briar patch of MIPS. The positive and negative variVerDate Nov 24 2008 14:17 Jun 07, 2019 Jkt 037690 PO 00000 Frm 00082 Fmt 6633 Sfmt 6633 U:\MY DOCS\HEARINGS 115\HEARINGS\115-166 CHRIS
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ations in reimbursement under the MIPS systems is going to be 

very disruptive for physician practices, especially small physician 

practices. 

Our ACO has a large employee medical group in it that’s owned 

by Covenant Health. But 50 percent of our organization is composed of independent physicians, which are just one- or two-person 

groups. 

The amount of money that has to be put into that to make those 

folks work under a MIPS system is horribly expensive and together, collectively, we thought that we could do better if we were 

in a risk-bearing program. We’d already had some experience 

under Track 1. 

We saw what we could do from a quality perspective and we had 

been decreasing the amount of spend. The difference is, though, the 

way they calculate your financial benchmarks under Track 3. Totally different than Track 1, and we really didn’t have a good understanding of that when we entered into Track 3. So that’s made 

that a little bit problematic for us. 

Mr. GREEN. Going from what you were, what type of infrastructure changes and provider education and training did your organization undertake to implement the ACO model? Was it—from 

where you went to what you’re doing now? 

Dr. ROBERTSON. We started in 2007 and initially just took commercial contracts. But we started then developing a way of showing 

physicians their individual performance. Every physician believes 

that they are the world’s greatest physician and they provide absolutely good quality care. 

The problem is our system is so broken that it encourages just 

transactional care. You’re there for 15 minutes and then good luck 

to you, or you get to the hospital dismissal driveway—good luck to 

you. 

Doing this requires you to think differently. You own that patient 365 days a year, 24 hours a day, and you have to have access 

to some data to help you understand where the spend is occurring 

and then you have to invest not only in IT systems to show physicians how they’re performing but you have to hire a lot of people 

to help patients do things that you need for them to do. 

You can’t imagine that a patient is going to be able to take everything you tell them in a 15-minute visit. Our care coordinators can 

move out into the community with them, help them stay on track, 

help them set goals for self-care, and provide them some other opportunities to find medications that we sometimes prescribe that 

we have no idea are so expensive and get them access to the medications they need at a better price. 

Mr. GREEN. Well, I’ve been on the committee since 1997 and it’s, 

like, I got so tired of hearing about how bad the SGR was and 

that’s why this committee wants to stay on top of it because the 

last thing we want to do is recreate the problems physicians had 

under the SGR, and that’s why I appreciate the whole panel to be 

here. 

By the way, my son-in-law is a gastroenterologist and my daughter is in infectious disease so and they do think they can cure everything. 

[Laughter.] 

78 

Mr. BURGESS. They probably can. 

Mr. GREEN. And I am glad they can. 

Mr. BURGESS. The gentleman yields back. The chair thanks the 

gentleman. 

The chair recognizes the gentleman from Kentucky, Mr. Guthrie, 

the vice chairman of the subcommittee, 5 minutes for your questions, please. 

Mr. GUTHRIE. Thank you very much, and the first question is for 

Mr. Reed, and I think I wrote it down. I was trying to write as you 

were saying it but I am not that quick. 

But you talked about making changes and you said in your testimony make changes in the Stark and anti-kickback laws in order 

to get the technology in the hands of patients. I think that’s pretty 

accurate what you said. 

How does the anti-kickback statute prevent providers from giving patients the tools that may help them, and if we update the 

statutes how do we effectively protect against fraud and abuse? 

Mr. REED. Well, I think that’s at the core of the question and I 

was very pleased to hear several other folks of this panel talk 

about the fact that the way that, especially in the ACO space, it 

works is, as I understand it, if a physician group wants to provide 

technology into the hands of a patient for remote patient monitoring or other patient engagement that might have—part of it 

would be a referral that it kicks into a consideration under the 

anti-kickback. 

The problem with that is that the very tool that I might put into 

the hands of a patient, a tablet like this one or anything like that, 

that I am going to use to gather data on the patient, I am going 

to want to necessitate a referral if one of the things that shows up 

from the evidence that I am collecting on that patient says, hey, 

they need to see a gastroenterologist. 

And so the moment that I do that I am in trouble with the law. 

As far as where the fraud lies, the reality is the fact of remote patient monitoring and digital services it’s a whole lot easier to monitor exactly what the use of that device is doing, what it’s entailing, 

how long it’s used for. 

In fact, the very data that we need to show effectiveness is also 

going to be very useful to demonstrating that it’s not being used 

fraudulently. 

So we think that removing that barrier for good recommendations to good gastroenterologists or infectious disease specialists 

like Mr. Green’s daughter are the kind of tools that we need to 

make available, and the idea that a patient is now limited because 

I can’t give them the tech that they need, that’s just crazy. 

Mr. GUTHRIE. I don’t disagree with you. 

So, Dr. Peck, how are healthcare apps and telehealth services 

changing the Nation’s healthcare access? Sort of mentioned here, 

and how do we encourage telehealth, from our perspective? 

Dr. PECK. Thank you. 

In terms of the apps question and technology, I do agree that 

there is the component that whenever I suggest to have an app in 

the hands of a patient, when they start to use it if it does generate 

the idea that they now need to see another physician that can 

cause a lot of problems in terms of self-referral. 

79 

So but moving into telemedicine, there’s a lot of talk of 1834 and 

of Social Security Act, and lifting that. I would like to make the 

point that lifting that in 1834(m) seems to be a plug into the hole 

that fee-for-service Medicare beneficiary program has created for 

itself. 

Because smaller companies, startups, innovations even of larger 

companies and of healthcare systems don’t have a way necessarily 

to value-based contract with Medicare directly, they have no way 

to get paid for innovative programs that are outside the fee-forservice schedule. 

If you have something that’s innovative, new, better, cheaper, 

faster, and brings higher quality, well, that’s perfect for valuebased care. 

So why can’t we have a provider contract with Medicare? CMMI 

is one of the ways to do that. But, again, this is a long, arduous, 

expensive, and not very flexible process. 

The RUSH Act, which I talked about, was introduced and the 

RUSH Act works for nursing homes but I want to broaden that out. 

I think what’s important about the RUSH Act, when you take a 

look at it, is that has this value-based arrangement idea with 

Medicare. 

It allows the providers, the doctors, the nursing homes who are 

housing the patients, and Medicare to all share in any savings that 

are generated. 

And then there’s down side risk as well. 

Mr. GUTHRIE. I’ve only got about 30 seconds. To anybody on the 

panel, so we are talking with Medicare here and how difficult it is 

to innovate and change things. 

Are you seeing it when you’re dealing with private health insurance and others? 

Dr. PECK. I am talking about Medicare. 

Mr. GUTHRIE. I know you are, but do you see it in your private 

world it’s quicker to adapt and you’re seeing these changes? 

Dr. PECK. Yes. 

Mr. GUTHRIE. So that we would lose these changes if we just 

went to pure Medicare for everybody? 

Mr. REED. Absolutely. There are problems on the innovation side, 

and here’s one of the problems. 

As we noted earlier, it’s a trillion dollars. So anyone, any venture 

capitalist, when our members are looking at raising money, the VC 

is going to ask, well, what’s the total addressable market, and 

when you have to describe that one-third of your total addressable 

market is Medicare and Medicaid, the next question is so how do 

we get paid out of that system. 

So when you look at 1834(m) as a plug that prevents—and I am 

going to do something unheard of—I am going to say something 

nice about a government agency—CMS has actually done some 

good things lately to try to break free of where 1834(m) has been 

preventing forward progress. 

But to your direct question, even though in the private sector 

there are ways around Medicare and Medicaid reimbursement, 

there’s a trillion dollars of addressable market there that any wise 

venture capitalist is going to say how do we get to it, and with barrier like 1834(m) it’s staving off our ability to move into that space. 

80 

So yes, it harms our ability on the Medicare and Medicaid side, 

and yes, it harms our ability to grow our businesses to cover more 

people. 

Mr. GUTHRIE. Thanks. I am out of time. I yield back. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

The chair recognizes the gentleman from New Mexico, Mr. Luja ́n, 

5 minutes for your questions, please. 

Mr. LUJA ́ N. Mr. Chairman, thank you so very much for this important hearing and I want to thank our ranking member, Mr. 

Green, as well. 

I would also like to acknowledge Chairman Walden and Ranking 

Member Pallone for looking at how telehealth services can be used 

to improve access to quality care, to save patients and Medicare 

time, energy, and money. 

Dr. Peck, you point out in your testimony that if skilled nursing 

facilities across the country are to implement telehealth services to 

scale then something needs to change within the billing system. 

The skilled nursing facility value-based purchasing program authorized by the Protecting Access to Medicare Act is shifting Medicare’s reimbursement for skilled nursing facilities to a value-based 

system. 

SNFs are now evaluated on a hospital readmission measure that 

provides incentive payments to encourage SNFs to keep patients 

healthy. 

Dr. Peck, how does Call9 and models like Call9 affect nursing 

homes’ performance under this new reimbursement system? 

Dr. PECK. Thank you for that question. 

The new reimbursement system and models like Call9 that decrease hospitalizations—unnecessary and avoidable hospitalizations—increases the payments to nursing homes and rewarding 

them for that good behavior. 

And I would mention in my testimony that one of our first nursing homes just finally got their value-based score and they are receiving a large bonus from that. 

What that program doesn’t do is incentivize the providers—the 

physician groups who are delivering that care. That program does 

give the bonus to the nursing home itself but not to the providers, 

the doctors. 

So it’s a good program and I think it will help a lot and 

incentivize a lot of nursing homes to reduce hospitalizations but 

leaving out the physician groups. 

Mr. LUJA ́ N. I appreciate that very much, especially in light of 

your testimony and the testimony of others that found that 19 percent of transfers to the emergency department are from skilled 

nursing facilities—one in five. 

You mentioned in your testimony that Call9 model uses additional clinical staff to complement the nursing home staff. Can you 

elaborate on how the Call9 staff work with nursing homes to treat 

patients? 

Dr. PECK. Certainly. So our particular model we place first responders. These, by training, are EMTs, paramedics. They can be 

nurses with emergency experience—CD techs. 

81 

What unites them all is that they understand emergencies and 

acute care. I think this is a key point. A broader point is that what 

we do is we bring the emergency department to the nursing home 

in this way with the physician who is remote in this onsite. 

Nurses in nursing homes are great at chronic care. That’s what 

they do, and if the nursing homes had faculties and staff that could 

take care of emergencies, we wouldn’t have 19 percent of the patients going to emergency department coming from nursing homes. 

So what we do is put the emergency care in there to supplement 

but not—and complement, excuse me, but not supplement what 

they do—not replace what they do. 

Mr. LUJA ́ N. Many members of the subcommittee worked on recent provisions to expand telehealth reimbursement for telestroke, 

end-stage renal disease, accountable care organizations, and Medicare Advantage plans. 

Dr. Peck, how does the RUSH Act build on this successful legislation? 

Dr. PECK. Right. So all of those legislations help address the 

CBO issue of the CBO scoring telehealth usually as an additive 

program. The reason for this is they count it as a duplicative measure. 

Telestroke—I will key in on that one—end-stage renal disease, 

we can key on that as well. It’s very hard to make more strokes. 

It’s very hard to make more sessions of dialysis every week for a 

patient. 

So it controls itself in terms of the volume that’s there and that 

lends itself perfectly to value-based arrangements and value-based 

contracting. 

Our model is working with emergencies. It’s very hard to rack up 

new emergencies and make more emergencies out of thin air. So 

when you have that kind of cap on a certain condition I think 

that’s a nice place to start to focus on to start to chip away at 

bringing value into Medicare. 

Mr. LUJA ́ N. And the requirements under the RUSH Act speak to 

additional workforce. What qualifications will these people have 

and is there a way to train existing staff to accomplish the same 

goal or is there value to bringing in a new person? 

Dr. PECK. Yes, I think there are ways to have existing staff become more trained in emergencies, have more skills for emergency 

medicine, be more comfortable in CPR type settings. 

However, I do believe it’s important to have additional staff if 

you’re going to retain patients in a nursing home and more patients who are sick. Having the existing staff there and not augmenting with another person I think will take away from the care 

of the rest of the patients who don’t have emergencies. 

Mr. LUJA ́ N. I appreciate that. Thank you, Mr. Chairman. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

The chair recognizes the gentleman from Ohio, Mr. Latta, 5 minutes for your questions, please. 

Mr. LATTA. Thanks, Mr. Chair, and to our panel today, thanks 

very much for being here on this very important topic. 

82 

If I could start, Dr. Anand, with you. Do medical professionals 

or health practice of health practices face barriers, regulatory or 

otherwise, to adopt new technologies? 

Dr. ANAND. Yes, great question. So I think we’ve alluded to several comments on the barriers that we face. One is related to being 

able to financially support the costs that go into implementing new 

technologies and tools. 

With our independent physicians, when I was in Texas the average practice size was about one and a half for the independent physicians. Some places are a little bit larger. 

But independent physicians don’t have the capital in order to be 

able to make those purchases. When you’re in an ACO construct 

and you apply the Stark waiver and the Stark exemptions, you can 

now, as a system, come together and allow them to access those 

tools and technologies and apply it across their patients. 

The challenge we find is those tools and technologies, and it’s a 

question that we’ve struggled with, is can you apply those tools and 

technologies only for Medicare beneficiaries or apply them broader, 

more widely, across all of the patients or the provider panel that 

the patients see. 

And that’s been a big struggle for us. We’d love to see the Stark 

waiver expanded and, in an ACO structure, provided at the provider level because as clinicians we can’t sort out who’s in which 

program and when a member is in another program. 

We can use this tool and technology that’s going to change care 

for this patient but we can’t use it in that other patient situation. 

So those are some of the challenges that we face. I think if we 

could, in the ACO construct, we are coordinating care basically— 

provide these tools and technologies and allow them to use those 

tools and technologies for all of their patients I think we’d be in 

a much better situation. 

Mr. LATTA. Let me ask you this—just follow up on that. You’re 

talking about the independent practitioners out there. Would that 

also—these barriers be disproportionately affecting small and rural 

providers because—who could benefit quite a bit from telemedicine? 

Dr. ANAND. We do. In our health system we have several markets that are in rural markets. We have one in Asheville, North 

Carolina—a campus that’s there. We also have one in Manchester, 

Kentucky, and in those settings what we are finding is it’s becoming harder and harder to have specialists and particular services 

provided in those markets. 

Now, in our system, we have a great skill set and great number 

of specialists in our Orlando market and we would love to be able 

to provide that cognitive expertise to those folks in Manchester, 

Kentucky, as an example. 

The reimbursement models we struggle with we’d love to be able 

to support the providers that are providing primary care services 

with the specialists that we have. 

And so we struggle again with the Stark rules that go with it. 

But rural services, at least in my opinion, are going to continue to 

be harder to come by, especially with specialty services, and when 

we have these large centers that can provide those services if we 

could figure out a way through the Stark exemption and payment 

83 

models to transpose that cognitive skill to those markets our beneficiaries will be able to get much better care. 

Mr. LATTA. Well, if you look at what we could do in Congress, 

what would you like to see us do specifically? 

Dr. ANAND. I think if we could do two things—one is allow us 

in certain, especially rural markets and critical access and hospitals that don’t have access to larger partnerships—allow us to 

provide those tools and technologies through a Stark exemption. 

Number two is if we could figure out a payment model where we 

could reward those services and cover some of the infrastructure 

costs that go with it I think that would allow us to be able to provide that service on a larger scale and, again, it would allow better 

access for beneficiaries and the patients that live in those smaller 

rural areas. 

Mr. LATTA. Mr. Reed, with my last minute I have, I am a firm 

believer that data has the power to spur change and data allows 

us to recognize important trends and patterns that, in turn, influences decision making and ultimately finds solutions. 

How could Congress reduce these barriers to sharing health and 

patient data without compromising that patient privacy? 

Mr. REED. Well, it’s a great question and, of course, it’s always 

good to remember that the P in HIPAA stands for portability, and 

I think that’s at the core of where we stand. 

We would urge Congress to do everything in your power to address what Dr. Burgess said earlier and that is let’s see ONC’s report on info blocking, because ultimately, as we are moving into 

this space where data has to be available and interoperable, we 

know that the only way to get a patient the solution that they need 

is to find out what’s wrong with them, and the more data that all 

of these gentlemen here at this table, and Mary, can have, the better chance we have of correctly identifying the disease and, more 

importantly, getting you the right treatment at the right time. 

So, first of all, we need to do better on interoperability. Second, 

we need to continue to push forward on finding the right terms and 

glossaries so that the notes fields, which are a key aspect of how 

a doctor communicates your story, not just your test results, becomes part of a record that can be used by every single person at 

this table. And so it starts with ONC. Let’s see what they have to 

say. 

Mr. LATTA. Thank you very much. 

Mr. Chairman, my time is expired and I yield back. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

The chair now is pleased to recognize the gentleman from Virginia, Mr. Griffith, 5 minutes for your questions, please. 

Mr. GRIFFITH. Thank you very much, Mr. Chairman. 

First, before I do that, I have a letter that has been sent in support of the RUSH Act, which Dr. Peck was so kind to make nice 

comments about earlier that Mr. Luja ́n and I of this committee 

have signed onto along with a number of others, including Adrian 

Smith. But I have a letter, without objection, if we could submit 

that for the record. 

Mr. BURGESS. Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

84 

Mr. GRIFFITH. We’ll get that down to you. All right, I appreciate 

that. 

And, Dr. Peck, again, thank you for your kind comments on the 

bill and I know we’ve got a lot more to do, and this just gets us 

started and you made some comments in that regard as well. 

You also mentioned in your testimony that Call9 treats 80 percent of the patients you see in the nursing home versus transferring them to the emergency department. 

How do you interact with the other 20 percent of patients that 

are still transferred to the emergency department? 

Dr. PECK. It’s a great question. That’s where we get to save a lot 

of lives that otherwise wouldn’t be saved. That’s why I left my job 

as a traditional emergency physician. Someone took my job as an 

emergency physician after I left, right. 

But these patients who we can’t get to in their moment of emergency in these nursing homes they otherwise would be pulseless. 

They otherwise would be having very severe problems. 

But with our program and other programs in nursing homes we 

can get to them at that point, and the average—when you put all 

the numbers together after you call 911 it takes about 64 minutes 

including the wait to see an emergency physician. If you’re 

pulseless, across the country that can be 36 minutes. So yes, being 

with people at the moment of emergency saves lives. 

Mr. GRIFFITH. And that’s very good. But I guess I am trying to 

figure out, OK, what happens once they go off to the emergency 

room? You have decided that you all can’t take care of it and you’re 

getting 80 percent of them right there in the nursing home—they 

never have to make that trip and, as you describe in your opening 

statement, with the bright lights that are confusing and the long 

wait and the ride in the back of a van. It’s an ambulance. But 

when you’re sick and not feeling well, it’s just the back of a van. 

Dr. PECK. Yes. Yes. 

Mr. GRIFFITH. So how are you able to continue to interact with 

that 20 percent that’s at the hospital? 

Dr. PECK. Right, and we talk a lot about interoperability and 

pushing data over, and writing—even being able to write notes in 

the same language that an emergency department needs to see and 

streamlining the data transfer is where there’s a lot of opportunity 

to help those patients. Yes. 

Mr. GRIFFITH. All right. 

And in your testimony, you stated that Call9 currently operates 

in 10 nursing homes in New York—and this was in your written 

testimony—but has not spread to more rural areas. 

Yet, how would Medicare’s reimbursement of technology-enabled 

care delivery models allow for these models to reach more rural 

areas? 

Dr. PECK. Yes. So right now, we are dependent on the Medicare 

Advantage and commercial payers to be able to make this happen. 

So we have to go to areas where those MA penetrations is as high 

as possible, which is usually urban areas as well as larger nursing 

homes where there’s more MA patients. 

So we can’t possibly go to smaller nursing homes or Medicareheavy nursing homes right now. We would lose the company. 

85 

Mr. GRIFFITH. Now, you said Medicare heavy. What about Medicaid-heavy nursing homes? 

Dr. PECK. Right, so long-term care Medicaid patients are usually 

dual eligible for the most part because they’re over 65 for the most 

part, or disabled for the most part. So Part B is where these payments are coming from, not from the Medicaid program. 

Mr. GRIFFITH. OK. I appreciate that. 

Representing a fairly rural not affluent district, this is one of the 

reasons that I am pushing for these ideas because my constituents 

deserve to get just as good care as those folks in the urban areas 

or in the wealthier areas. 

Let’s see if I have time to get one more in. 

Dr. Peck, one issue policy makers have faced in advancing telehealth legislation is the lack of data, and I know everybody’s talked 

about data, but the lack of that data on the effects of telehealth on 

actual Medicare beneficiaries, this is a hard barrier to overcome because without reimbursement for providing these services to Medicare beneficiaries there are few who are going to be able to take 

the financial loss to build enough meaningful data. 

How can Congress continue to support entrepreneurs in generating these meaningful data points? 

Dr. PECK. Yes, it’s vehicles to be able to get these models through 

after they’re proven, the PTAC being one of those. We have held 

back our PTAC application at this point until we understand more 

about what the program intends to do. 

We also see this opportunity—the RUSH Act as the tip of the 

spear to be able to have Congress directly allow Medicare to contract with startups and entrepreneurs and innovative programs. 

We need those on that side to be able for me, as an entrepreneur, 

to go to the venture community and raise money. They’re not going 

to give it to me unless there’s a way to make return on that investment. 

Mr. GRIFFITH. Right. Well, I appreciate it and appreciate all of 

you all being here. This is an important subject and I look forward 

to working with all of you as we move forward. 

I yield back. 

Dr. PECK. Thank you. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

The chair recognizes the gentlelady from California, Ms. Matsui, 

5 minutes for questions, please. 

Ms. MATSUI. Thank you, Mr. Chairman. I want to thank the witnesses for joining us today. I am pleased that we are hosting this 

hearing to discuss how we transition toward rewarding value over 

volume in our healthcare system. 

Thanks to the Affordable Care Act, the MACRA providers today 

have more opportunities than ever before to redesign how they deliver care to their patients. 

Moving to value-based care is important. But we can’t lose sight 

of the importance of the Stark Law in protecting the Medicare program from waste, fraud, and abuse. 

Although a shift to value-based care may require re-examination 

of certain policies, the self-referral laws continue to serve an important purpose. 

86 

It is important to differentiate between changes to Start Law 

that would lead to more value-based payment models and coordinated care and changes that would gut the intention of Stark and 

allow the pay for play at the expense of patients. 

Several of you note that the secretary has authority to waive the 

Stark Law for innovative value-based arrangements. 

Mr. Reed, your testimony notes that you believe that HHS has 

clear authority to provide exceptions to the Stark Law. Can you expand on what steps you believe the secretary can take to modernize 

Stark to encourage high quality value-based care? 

Mr. REED. Well, I think you have heard from the multiplicity of 

the witness perspectives here that essentially the secretary needs 

to look at the Stark and any kickback from the perspective of what 

is your ultimate goal. 

You said the ultimate goal is to make sure that we don’t have 

waste, fraud, and abuse. I would posit the primary goal of Medicare 

is to make sure that people over the age of 65 have the kind of care 

that helps them stay healthy and be independent. 

And so when I look at it from the perspective of what is the capability of the secretary to waive, you used some key words, which 

was innovative technologies that can help improve the outcome. 

And so I think that with each request for an exception I think 

it falls under that waiver authority. But I also would note that we 

have to be very careful with waiver authorities to something that 

Dr. Peck said earlier, which is when it only happens every year 

enough to renew, it makes it quite difficult when you sit down with 

a venture capitalist and your new board to say our entire business 

model is dependent on our hope that a waiver will continue to the 

next year. 

Ms. MATSUI. Yes. 

Mr. REED. And while we are not only bidden to the VC community, we have limited resources. It changes where you focus your 

time and energy if you have that possibility hanging over your 

head. 

So I would like the waiver to be exercised on those innovative 

technologies but in a manner in which allows us to really build and 

grow them and not just worrying about—— 

Ms. MATSUI. OK. 

Mr. REED [continuing]. Where there might be an overuse. 

Ms. MATSUI. OK. Now, I want to get into telehealth, because over 

the years a group of us on Energy and Commerce have worked together to advance the adoption and use of Telemedicine. 

As CMS implements MACRA, we want to make sure that the 

new health technologies are integrated into new models of care 

from the start. 

And, Mr. Reed, in MACRA Congress intended for telehealth and 

remote monitoring to be rewarded within the MIPS clinical practice 

improvement activities. 

Can you comment on CMS’ recent efforts to support and expand 

the use of these services? 

Mr. REED. Absolutely. We are very pleased that the MIPS program included IA activities. Especially, we think it’s very important that they allowed for small practices to see their number—to 

get an appropriate reward for engaging with their patients when 

87 

it comes to using telemedicine and remote patient monitoring products. 

I think what’s really important though is for the parts that 

you’re mentioning, which are critical, and are worthy of note, we 

don’t think we should forget the fact that the APMs—that there 

was no mention of remote patient monitoring as part of the 

APMs—— 

Ms. MATSUI. Right. 

Mr. REED [continuing]. And I think it’s important to note that, 

from our perspective, we appreciate what you have been doing both 

as a cosponsor of Connect for Health and as a cosponsor for the evidence-based Telehealth Expansion Act. 

So we appreciate the work you have done in this space and we 

think that that all needs to be continued. 

Ms. MATSUI. OK. Now, as CMS continues implementing MACRA, 

in what ways should Congress be thinking of program oversight 

with regards to promoting the use of telehealth and remote monitoring services? 

Mr. REED. Evidence. That’s the real crux of this issue. We always 

take the perspective that every physician—and the whole system 

has three real questions: does it work, will I be in trouble for using 

it, and then, finally, does it make economic sense. 

And so that first question of evidence becomes critical. You have 

heard multiple people here talk about CMMI. I think it’s ironic 

that CMMI—we met with CMMI the other day. Love them, great 

people over there. But they told us, hey, we are going to move really fast and get this study out in 10 years. 

[Laughter.] 

Ms. MATSUI. OK. 

Mr. REED. Just recently all of you know that 10 years ago there 

were no smart phones. 

Ms. MATSUI. That’s right. 

Mr. REED. That’s when that started. So and we are looking at the 

evidence that we need to bring to the fore. We cannot wait for 

CMMI and a 10-year study that hopefully shows how it all works. 

We are going to have to use other sectors. 

Ms. MATSUI. OK. 

Well, thank you, and I’ve run out of time so I yield back. 

Mr. GUTHRIE [presiding]. Thank you, and I appreciate the 

gentlelady for yielding back and the chair now recognizes Mr. Bilirakis from Florida for 5 minutes for questions. 

Mr. BILIRAKIS. Thank you, Mr. Chairman. I appreciate it very 

much and I thank the panel for their testimony today. 

Dr. Anand, thank you for being here and I have a couple questions for you. 

Adventist Health System has a sizeable, as you know, presence 

in Florida. You stated that earlier, and throughout the Tampa Bay 

area—and I represent parts of the Tampa Bay area—I want to 

commend you also for making such tremendous improvements to 

Florida Hospital North Pinellas, which is my hometown hospital, 

and the community has really rallied around the hospital. So thank 

you so very much. A wonderful place. 

88 

Dr. Anand, how many of your doctors are involved in and how 

many independent physicians are part of your accountable care organization? 

Dr. ANAND. Great question. When you look at the State of Florida, we’ve set up one accountable care organization that serves approximately 55,000 Medicare beneficiaries. 

When you add our ACOs and our clinically integrated networks 

in the State of Florida, we have approximately 3,900 physicians of 

which two-thirds are independent physicians. 

We partner with them in the Tampa market, for example. The 

numbers may vary a little bit but that statistic, about two-thirds, 

holds pretty true. 

Mr. BILIRAKIS. OK. You have set up again and operate a number 

of ACOs. Is that correct? And where exactly in Florida? Is that at 

the Orlando area or is that in several hospitals in the Tampa Bay 

area? 

Dr. ANAND. Good question. 

So what we’ve done, in order to help improve the care in Florida 

we’ve actually set up one statewide Medicare shared savings program—one ACO—that encompasses the whole area. 

It’s in the Tampa market, goes into the Orlando market, brings 

together providers from the Daytona, Volusia, Flagler, Highlands, 

Hardee County. In the future, we’ll actually be part of it as well. 

And so what we are hoping to do is starting to bring together an 

improvement model where we can actually improve the care and 

wellbeing of all the patients in Florida. 

Mr. BILIRAKIS. Very good. Very good. 

What makes your ACO unique when compared to other ACOs 

and how has your ACO been successful? How has it been successful 

in reducing costs and increasing outcomes? 

Dr. ANAND. Great question. 

Mr. BILIRAKIS. Increasing outcomes—that’s the bottom line—the 

quality of care. But go ahead, please, sir. 

Dr. ANAND. Great question. 

So let me tackle the first question—what makes our ACO different. 

Mr. BILIRAKIS. Yes. 

Dr. ANAND. So from a organizational perspective, we fundamentally believe in holistic care. We believe that medical care is a 

small portion of the overall health and wellbeing of our patients 

and beneficiaries. 

And so we focus on things that affect their social determinants 

of health—their mental wellbeing, their spiritual wellbeing, some 

of their financial issues that we have. 

And so we really take a holistic picture and approach to improving the health and wellbeing of those patients. The literature has 

confirmed over and over that when you apply that holistic approach you’re going to get better health outcomes. 

If you come and treat the emergency medicine physician as 

well—if you treat the patient in the emergency department and 

then they go off and they don’t have the services that they need, 

they will be back in the emergency department over and over 

again. 

89 

And so that’s been one of the fundamental approaches from the 

beginning is that we want to make sure we incorporate all of those 

elements into—— 

Mr. BILIRAKIS. Cost reduction is a factor as well. 

Dr. ANAND. Correct. From a cost reduction perspective, we focused on where the variation lies in care and there is tremendous 

variation as you go from region to region as well as provider to provider. 

And what we do is we help provide the tools, the technology, the 

data, the analytics that empowers physicians to have the information that they need to provide the best level of care. 

We are looking at pathways related to issues such as back pain 

where we can actually provide interventions and treatments that 

are going to make a lasting improvement such as physical therapy, 

rather than just going straight to surgical therapy, which may not 

improve outcomes initially. 

Mr. BILIRAKIS. I like that. 

Can you talk about some of the challenges you face in structuring your particular ACO when dealing with the Stark Law? 

Dr. ANAND. Yes. That’s a great question. 

So we had several challenges with the Stark Law. I think we’ve 

covered a lot. But just to summarize, if it was permanent I think 

that would be a big help. 

Two, there’s a lot of questions about the applicability of the Stark 

waivers for all patients. Some of our providers have 10 Medicare 

beneficiaries. Some of them have Medicaid beneficiaries. 

Some of them have a hundred or 1,500 Medicare beneficiaries 

and what we would like to do is actually see the Stark waivers 

apply down at the provider level so that the provider doesn’t have 

to realize that this patient is a Medicare beneficiary that’s in an 

ACO program. This Medicare beneficiary is not—this other one 

may be, but we are not quite sure right now. 

It’s too hard to operationalize from a physician perspective and 

so we’d like the Stark Law to apply to provider level. If we can do 

that, we can coordinate care effectively because we have the pathways. We know what the clinical pathways are and we can share 

it with the physicians and allow them to provide the best care. 

The tools and technologies that we’ve talked about we have those 

available and we’d love to be able to share them with the physicians. But we still have confusion on if they can share it with 

just—and use them just on their Medicare beneficiaries or if they 

can use it on all patients. 

And so we love the direction that the committee is headed. We’d 

like to see an expansion in those particular instances. 

Mr. BILIRAKIS. Very good. 

Thank you very much, Mr. Chairman. I yield back. 

Mr. GUTHRIE. The gentleman yields back. 

The Chair now recognizes Mr. Long from Missouri for 5 minutes 

for questions. 

Mr. LONG. Thank you, Mr. Chairman. 

And Mr. Reed, in your testimony you talk about the value telehealth can have for taxpayers. You state that evidence from practitioners contradicts the often overstated fears that telehealth could 

lead to a bonanza of over utilization. 

90 

Instead, telehealth could substitute for otherwise more expensive 

healthcare services. Could you talk about what the evidence has 

shown so far on the cost savings that telehealth could produce? 

Mr. REED. Absolutely, and I know it’s a rival state but the also 

great State of Mississippi has done some amazing work with telemedicine and remote patient monitoring, particularly in the area of 

type 2 diabetes care. 

What you see out of the University of Mississippi Medical center 

is an effort to directly engage with patients, particularly in the 

Delta, who have no care or no facility or an originating site within 

2 hours. 

It was crushing the state economically. But by putting a tablet 

in the hands of folks at home with the necessary high-speed connection that exists in those areas what changed was the nurse 

practitioner could notice, hmm, your blood glucose is kind of high— 

let’s get on the phone. Oh, it was a family reunion? OK, stay off 

the pecan pie for the next week—let’s get that down. 

And so what you saw is you didn’t see an over utilization. What 

you saw was a stoppage of the kind of danger symptoms that went 

on. So instead of that person ending up on the pathway to blindness, on the pathway to losing a leg, you saw them engaging with 

a nurse, maybe with a little nagging, to say hey, back off that— 

don’t have that second piece—let’s get you in for a test. 

So when you think of it in very simple terms, you’re right— 

maybe telemedicine means that they go have a face to face visit. 

But if that face to face visit is a conversation about how they 

stay healthy, that’s a whole lot cheaper than a face to face visit 

that results in an amputation or blindness or a treatment that 

they’ll never recover from. 

So I am OK with telemedicine leading to a lot of physician engagement because it’s the kind of engagement that keeps people on 

the front side of the wave and not the back. 

Mr. LONG. So that’s where the savings comes in then? 

Mr. REED. Absolutely. 

Mr. LONG. So how long would it take these cost savings to materialize? 

Mr. REED. Well, here’s what’s amazing. In states like Mississippi 

and in other places, they’ve seen 100 percent reduction in readmissions in certain types of type 2 diabetic problems and they’ve had 

those results in a matter of 2 to 3 years. 

So a lot of it is what kind of nurses you have—we’ve had a lot 

of discussion about skilled nursing—what kind of nurses you have 

and what elements you have to engage. 

But we are not talking about a decade to see an improvement. 

We are talking about a short matter of years, depending on the 

condition and where those people are in terms of their education. 

Mr. LONG. OK. When you’re talking about that they’re using telehealth and monitoring their type 2 diabetes—their glucose monitor, 

I guess, or whatever—so these people are pricking their finger at 

home and then relaying to the nurse or practitioner, doctor—— 

Mr. REED. Yes. 

Mr. LONG. Over the iPad? Is that correct? 

91 

Mr. REED. That’s correct, and here’s the part that’s really good. 

It isn’t just that that result goes. It’s not passive. They put that 

result in. They get information and feedback on how they’re doing. 

The most dangerous thing, and I know every physician here 

knows, is a passive patient. A patient who’s engaged in their care, 

they’re on top of it. When they see that number on that iPad, they 

say to themselves, well, how does that look. Oh, it doesn’t look 

good—what did I do. And then the nurse calls up and says hey, I 

didn’t like what you’re seeing, and here’s the really good part. 

What if they’re doing a great job? What if that is a great number? 

Mr. LONG. More pecan pie. 

Mr. REED. That’s right. But more importantly, then that pecan 

pie—what’s even better is the next step. The next step is the nurse 

calls up and says, you’re doing a great job, and that creates an active engaged patient. That’s where your savings come from. That’s 

what eliminates people. We are talking about numbers here but we 

are also talking about lives and quality of life. So it’s important 

that we deal with the numbers but let’s never forget about the people that are involved here. 

Thank you. 

Mr. LONG. How do we ensure the long-term savings from telehealth are factored in beyond a 10-year window? 

Mr. REED. Well, I think that’s something we’ve all been talking 

about here on the move that you and I believe your cosponsor on 

the Preventative Health Savings Act to try to move that ONC window. 

I think that realistically, given the speed of technology—like I 

said, there were no smartphones 10 years ago and then now none 

of you would ever be 3 feet away from your smart phone. 

So think what you have to look at is let’s extend the 10-year window but then let’s also be cognizant of the fact that we are probably going to see some major shifts in the way that people are engaged in their daily lives with technology. 

There’s this concept that tech is just about kids. That’s not true. 

Any of you have grandkids? I bet you you FaceTime with your 

grandkids on your mobile device. 

If you think about where adults over the age of 65 are with technology it’s a myth that people over 65 can’t tech because they can 

tech just fine. 

Mr. LONG. And these new watches that Apple rolled out yesterday with the telehealth applications on there. 

Mr. REED. Correct. 

Mr. LONG. Pretty amazing stuff of what they—I can’t remember 

the CEO’s name. Is it Cook now? Or whatever, but rolled out yesterday. 

Mr. REED. I will be happy to come by and show you one on September 22nd, I think. 

Mr. LONG. OK. Very good. Thank you, Mr. Chairman. I yield 

back. 

Mr. BURGESS [presiding]. Chair thanks the gentleman. The gentleman yields back. 

The chair recognizes the gentleman from Georgia, Mr. Carter, 5 

minutes for your questions, please. 

92 

Mr. CARTER. Thank you, Mr. Chairman, and thank all of you for 

being here. This is certainly a very important hearing. 

I want to start with you, Dr. Weinstein. 

Full disclosure—before I became a member of Congress I was an 

independent retail pharmacist so I appreciate independent 

healthcare practices. 

When I talk to my colleagues about the problems that we are 

having hanging on to independent retail pharmacies they think I 

am only talking about independent retail pharmacies. But I am 

not. I am talking about independent healthcare practices. 

That, to me, is a real big problem here and one of the things I 

wanted to ask you to begin with is I am really troubled to hear that 

your practice is having trouble with participating in some of these 

cost-saving arrangements with Medicare because of the outdated 

CMS policies. 

And I just wanted to ask you what do you think are some of the 

advantages that perhaps the big hospital systems have over you, 

being an independent practice? Can you think right off of some? 

Dr. WEINSTEIN. Well, hospital systems are really just people. So, 

the big hospital systems—I guess you might say that for the really 

complex tertiary care—complicated surgical infectious—somebody 

with a multi-system disease needing multi specialists, obviously— 

hospital systems are important. 

But many of the diseases that we take care of are really isolated 

to gastroenterology or maybe gastroenterology and surgery. So one 

or two specialties, and the idea is to be able to get to those people, 

engage those patients before they need major hospitalization. 

Mr. CARTER. Right. Right. 

Dr. WEINSTEIN. That’s where the savings is, and engaging those 

patients. The Project Sonar that I mentioned before, which was 

tentatively approved by PTAC but then didn’t move forward, is a 

technology engagement with patients to determine how they’re 

doing on a basis where they might ignore symptoms from time to 

time and engage them before they get to a hospital. 

So there is certainly need for hospital systems for the very acutely sick. But the majority of patients, hopefully, can avoid hospitals. 

Mr. CARTER. Absolutely. Well, thank you and good luck. I am 

pulling for you. Trust me. 

Dr. WEINSTEIN. Thank you. 

Mr. CARTER. Mr. Reed, I want to go to you because I’m very interested in this. I’ve had a company in my office that—and help me 

to articulate this because I suspect you know about it better than 

I do. 

But they’re coming to Georgia now and they are involved—they 

have an app that they’ve created because in Georgia right now it 

takes 3 weeks on average to get an appointment with a primary 

care physician and in some areas, particularly in the area that I 

represent—south Georgia, a very rural area—it may take even 

longer to get that. 

Well, they’ve come out with an app that can take advantage of 

cancelled—cancellations or changes in a schedule and you can use 

that app but they’re telling me that the only way they can bill for 

it outside of the private pay—the only way they can bill for it for 

the Medicare patients is if they do it by flat fee and they want to 

93 

do it on a per usage basis. Again, I am sure you understand that 

much better than me. But the rules are so antiquated that they 

can’t do it. 

Mr. REED. That’s correct. I had my staff, prior to this hearing, 

poll through my written testimony and come up with a glossary of 

44 different acronyms that I used—just from my testimony—and I 

am pretty sure that everybody here has the same number—but 

that really represents the status that your company in the great 

State of Georgia is dealing with. 

The problem that they face is they also get completely differing 

answers. For example, on the one you’re talking about, when you 

look to share that information on an application like that on how 

you bill, you have got to deal with a couple of different systems, 

not only from an interoperability perspective but also how do you 

do the data sharing. 

Right now, they can do a flat fee that somebody pays but if you 

try to do a per physician basis pay, there’s no mechanism by which 

it processes through the Medicare or Medicaid system. 

So they’re really stuck out there in the fee-for-service or private 

payer model and it makes no sense because, as you say, when 

somebody drops off of an appointment that they can’t get to, especially in areas like yours with a healthcare professional shortage 

area, this is the exact time that you want somebody to say hey, I 

need that patient, and as I said at the beginning, this demographic 

problem is only going to get worse, not better. 

So when it comes to the model, we really don’t see MACRA and— 

and I am sorry, we don’t see CMS really providing pathways for 

those kind of innovative products at all. 

Mr. CARTER. OK. OK. Well, I see I am out of time. Thank you, 

and I yield back. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

The chair recognizes the gentleman from Indiana, Dr. Bucshon, 

5 minutes for questions, please. 

Mr. BUCSHON. Thank you, Mr. Chairman. 

Dr. Weinstein, can you talk about the challenges in developing 

and testing an APM like Project Sonar and also do you think that 

the current volume and value prohibitions in the Stark Law make 

it difficult to test APMs? 

Dr. WEINSTEIN. I do. Thank you for the question. 

The problem with APMs in developing care pathways and determining how you’re going to share the care of a patient, potentially, 

with other physicians outside of the convener, whether—if the convener is an independent physician, if the convener is even a hospital system—if you’re going to interrelate with other physicians 

then you can’t test that to see whether the technology communication is correct, whether the in-patient engagement is correct. You 

can’t share the data because you will buck up against certain Stark 

regulations. 

So it would be great to be able to test an APM all the outcomes, 

the technology that’s needed, in a way before you get to a PTAC 

decision once the application is submitted and the current regulations don’t allow you to test. 

So, hopefully, I answered—— 

94 

Mr. BUCSHON. You did. It’s pretty clear there are Stark and antikickback problems that are making it difficult. The Medicare Coordination Improvement Act, which I’ve introduced with my Democrat colleague, Dr. Ruiz, would allow practices legitimately developing and implementing an APM to essentially be exempt through 

waivers from these provisions. 

Do you think this would encourage more practices to develop 

APMs? 

Dr. WEINSTEIN. I do. I think when we’ve polled, at least in the 

Digestive Health Physicians Association, I think these very large 

groups are very interested in modeling opportunities to take care 

of patients under lower cost/better outcome care. 

They’ve built the infrastructure to be able to do that. They’re 

willing to take risk to do that. So I think more people would be 

willing to look into other diseases, not just inflammatory bowel disease but chronic liver disease and such, and thank you for submitting that bill. 

Mr. BUCSHON. You’re welcome. 

I yield back, Mr. Chairman. 

Mr. BURGESS. The chair thanks the gentleman. 

The chair recognizes the gentleman from Illinois, Mr. Shimkus, 

5 minutes for questions, please. 

Mr. SHIMKUS. Thank you, Mr. Chairman. 

I apologize for not being here. I’ve learned everything about forestry services, wildfires, prescribed burns, and the health effects of 

wildfires in the air. So that’s where I’ve been the last 2 hours. 

We wanted to get up here to make sure we set the records for 

some public policy. So some of the questions that I had have already been answered through the question and answer period. But 

I want to state that promoting greater value within our healthcare 

system is a worthy goal and I strongly support efforts to promote 

value-based models within our Medicare program and throughout 

our healthcare system. But current progress has been slow. 

As elected officials, we need to find ways to increase the value 

opportunities in the Medicare program to address issues of program solvency and improve the patient experience, both for beneficiaries and, just as important, their loved ones. 

Reforms that empower all healthcare entities to engage in valuebased reforms can lead to meaningful value for all, unleashing private sector innovations within the program at a time when our 

benefits to care and programmatic spending are sorely needed. 

As this committee considers opportunities to promote value-based 

models, I recommend we consider two things. One is to explore opportunities to support all stakeholders—patient, payers, manufacturers, vendors, and providers—to enter in and benefit from participating in value arrangements; ensure that any reforms that are 

in this area are implemented in ways that ensure patient care and 

program spending are protected. 

Medicare beneficiaries and taxpayers should benefit from our efforts, not be hurt by them. Hence, your discussion and debate, 

which I missed a lot of, on the anti-kickback statutes, the Stark 

Laws, and the like. 

Also, you also talked about, obviously, the patient care and the 

protection of the taxpayers, spending. 

95 

So, Mr. Chairman and Ranking Member Green, although he’s not 

here—we see the Honorable Congresswoman Matsui in his place— 

I firmly believe that legislative approaches in this area should empower all Medicare entities to drive value throughout the program, 

ensure that beneficiary care and program spending are protected, 

and promote opportunities for beneficiaries to directly benefit from 

these reforms. 

That’s why I’ve asked my staff to begin developing legislation 

that creates avenues for all stakeholders—patients, providers, payers, manufacturers, and others to enter into and succeed in valuebased healthcare models throughout the Medicare program, not 

just within the constraints of CMMI. 

I hope to work with you, Mr. Chairman and Ranking Member 

Green, and my colleagues on both sides of the aisle in developing 

an advocacy of such an approach. 

Mr. Chairman, I would like to enter into the record a letter in 

support of the legislative efforts by the Breaking Down Barriers to 

Payment and Delivery System Reform Alliance and a letter from 

Advocate Aurora Health containing comments filed with CMS in 

response to its request for information regarding physician self-referral. 

Mr. BURGESS. Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

Mr. SHIMKUS. And with that—— 

Mr. GRIFFITH. Would the gentleman yield? 

Mr. SHIMKUS. I will yield. 

Mr. GRIFFITH. Mr. Reed has talked about how we didn’t have 

smart phones 10 years ago and the beauty of this is is that while 

our nursing homes might not be able to use telemedicine, you can 

go back and watch all the testimony later via your smart phone. 

Mr. SHIMKUS. And you don’t think I’ve done that? 

Mr. GRIFFITH. I don’t think you have done it yet. I think you will 

do it on the way home. 

Mr. SHIMKUS. You bet. Thank you, and I yield back my time. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

I believe that all the members of the subcommittee have been 

recognized for questions and we’ll now recognize Mr. Ruiz of California, who’s not on the subcommittee but has presented himself 

here, and you’re recognized 5 minutes for questions, please. 

Mr. RUIZ. Great. Thanks for letting me sit in here and listen to 

this wonderful presentation and also participate in this very important conversation. 

I was pleased to partner with my colleague and fellow physician, 

Congressman Bucshon, to introduce H.R. 4206, the Medicare Care 

Coordination Improvement Act, which would modernize Stark 

Laws to make it easier for physician practices to successfully develop alternative payment models, or APMs, incentivized in 

MACRA, and it will also incentivize us to fully reach a value-based 

payment model that the ACA encourages. 

I believe that Stark Law is important but it needs to be tweaked 

because currently physician practices are hampered from fully and 

successfully participating in APMs. 

96 

So the Stark Law was created to help curb some of the quantitybased payment models that we have developed in the past and oftentimes this Stark Law prevents physicians from referring to 

other physicians that they know in a medical home model-based in 

order to achieve a value-based payment model, which we want to 

move toward. 

So we need to update and we need to tweak it so that we can 

encourage a value-based payment model and alternative payment 

model. 

So this bill will give CMS the authority to give a narrow exception to Stark just for the time that the APM is being developed, 

which is the same waiver authority that was given to ACOs in the 

ACA. 

So, Dr. Weinstein, thank you for being here today and for your 

testimony in support of this legislation. In your testimony, you referenced the slow pace at which independent physicians have been 

developing alternative payment models. 

I am also concerned that in order for MACRA to succeed, we 

need to break down barriers encourage more innovation and care 

delivery models to be put forward. 

Can you give us a specific example of how, if we are able to pass 

this narrow exemption, an independent gastroenterology group like 

yours could improve patient care for your patients? 

Dr. WEINSTEIN. Again, thank you for the question and thank you 

for submitting the bill. 

As a specific example, we want to be able to reward physician 

behavior for following better care pathways and as opposed to just 

performing individual services. 

So if I am going to work with a surgeon and I want to work with 

a particular surgeon in an APM for dealing with inflammatory 

bowel disease, then I want to reward that surgeon for following the 

care pathways to lower the cost of care. 

If I am doing that then—if I am rewarding him for value, for better outcomes, well, that actually flies in the face of some of the language of the original Stark Laws. 

And I said it in my testimony—we are not in favor of removing 

Stark prohibitions on fee-for-service standard, self-referral, and 

things like that. That has nothing to do with modernizing the 

Stark rule for an alternative payment model, a model where groups 

of independent physicians are sharing risk in managing a better 

outcome for a patient and in doing that in a way that does not violate the Stark Laws. 

Mr. RUIZ. Thank you. I yield back. 

Mr. BURGESS. The chair thanks the gentleman. The gentleman 

yields back. 

Seeing that there are no further members to ask questions, Mr. 

Reed, I do want to just point out you have graciously mentioned 

several times today the Public Health Savings Act—the bill that I 

introduced with Diane DeGette some time ago—actually, several 

Congresses ago—and I had actually hoped to have a hearing on 

that before we concluded this year, it’s on the list just like the data 

blocking bill from the Office of National Coordinator. 

97 

But it is an extremely important concept to be able to look for 

preventative healthcare at a wider window than the 10-year typical 

budgetary window that the Congressional Budget Office allows. 

So I thank you for bringing that up and I am going to use that 

as additional gas in the tank to see if we can’t get that hearing 

structured. 

Mr. REED. No, we’d love to help you gain more cosponsors. Thank 

you. 

Mr. BURGESS. Thank you. 

Well, seeing that there are no other members wishing to ask 

questions, I do again want to thank our witnesses. 

I do want to submit the following documents for the record from 

Advo Med, from the College of information—I am sorry, from the 

College of Healthcare Information Management Executives, Cancer 

Treatment Centers of America, National Association of Chain 

Drugs Stores, Medtronic, the American Society for Gastrointestinal 

Endoscopy, and Jeff Lemieux and Joel White article in ‘‘Health Affairs.‘‘ 

[The information appears at the conclusion of the hearing.] 

Mr. BURGESS. Pursuant to committee rules, I remind members 

they have 10 business days to submit additional questions for the 

record and I ask the witnesses to submit their responses within 10 

business days upon receipt of those questions. 

And without objection, the subcommittee is adjourned. 

[Whereupon, at 3:16 p.m., the committee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Today’s discussion is important to help Congress understand the different ways 

we might expand innovative, value-based care in our Medicare program. 

The Affordable Care Act (ACA) took major steps towards improving the quality 

of our healthcare system by creating new models of delivery within the Medicare 

program. These new models were intended to transform clinical care and shift from 

a volume- to a value-based care model, such as Accountable Care Organizations 

(ACOs) and Patient Centered Medical Homes (PCMHs). 

With the passage and implementation of the Medicare Access and CHIP Reauthorization Act (MACRA), we entered the next phase of healthcare delivery system 

reform. MACRA built on the ACA’s efforts by offering opportunities and financial 

incentives for providers to transition to new payment models known as Advanced 

Alternative Payment Models, or A–A-P–Ms. AAPMs require providers to accept 

some financial risk for the quality and cost outcomes of their patients. 

MACRA also created the Merit-Based Incentive Payment System, or MIPS, an alternative path for clinicians to make the shift away from a volume-based system to 

a value-based system that focuses on quality, value, and accountability. Together 

these new programs were designed to influence doctors to make change and the law 

gives them great flexibility in choosing the right model for the right provider. 

Unfortunately, I have been disappointed thus far with the Trump Administration’s progress on building on these successes and their lack of actions to move the 

Medicare program to a value-based system. 

Most notably they have rejected the goals made under the previous administration, to make 50 percent of all Medicare payments to hospitals and doctors through 

value-based models by the end of 2018. 

They have not taken meaningful action to expand the number of Alternative Payment Models available to Medicare providers. They have failed to test or implement 

any physician-focused payment models and have cancelled or scaled back a number 

of bundled payment models. 

Meanwhile, CMS has taken steps to undermine MACRA’s MIPS program, by exempting 60 percent of Medicare physicians from its requirements. While I understand that there are challenges with MIPS, I don’t think the answer is to just exempt providers from its requirements. Nor do I think that is what Congress enviVerDate Nov 24 2008 14:17 Jun 07, 2019 Jkt 037690 PO 00000 Frm 00103 Fmt 6633 Sfmt 6633 U:\MY DOCS\HEARINGS 115\HEARINGS\115-166 CHRIS
98 

sioned. By exempting these doctors entirely, the Administration is choosing not to 

engage small providers-a lost opportunity to say the least. 

I am also concerned that the Administration’s proposed regulation on ACOs will 

dampen enthusiasm for engaging in these models. The evidence is unequivocal that 

ACOs have both improved the quality of care for Medicare beneficiaries, and saved 

the Medicare program money. 

As our two witnesses with experience with the ACO program will testify today, 

the kind of cultural change required to implement an integrated, patient-centered, 

system like an ACO takes time and investment in people and in systems. While I 

support efforts to get more ACOs to embrace financial risk, the proposed rule could 

potentially cut the program off at its knees by requiring ACOs to take on risk within two years, and by lowering the shared savings rate. 

Let me conclude by addressing the issues of Stark and the AntiKickback Statute. 

I know some stakeholders view these laws as a barrier to value-based payment reform. I would be interested in hearing about specific instances in which Stark and 

the AntiKickback Statute have posed barriers to value-based payment arrangements. But I also want to stress the continuing importance of these laws, which are 

intended to ensure that doctors do what is best for patients, not what is best for 

their bottom line. There is empirical evidence that these laws operate to prevent 

overutilization in Medicare. This is bad for both patients and taxpayers. So, we 

must proceed with great caution in making changes to these laws. 

I also want to underscore-eliminating or reducing the effectiveness of the Stark 

and Anti-kickback laws is not a delivery system reform agenda. On its own, deregulation does not move us to value. That will require transformative leadership at 

HHS, and an industry-wide commitment to align financial incentives with 

healthcare quality and performance, with the patient always at the center. 

I look forward to discussing these and other issues with the panel today. I yield 

back. 

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36533.083
127 


36533.084
128 


36533.085
129 


36533.086
130 


36533.087
131 


36533.088
132 


36533.089
133 


36533.090
134 


36533.091
135 


36533.092
136 


36533.093
137 


36533.094
138 


36533.095
139 


36533.096
140 

Æ 


36533.097