Doggett Opening Statement at Health Subcommittee Hearing on Value-Based Care
(As prepared for delivery)
Improving quality of care while reducing costs for taxpayers and patients is certainly a worthy goal. While I support paying for value over volume, efforts to achieve that have so far experienced very mixed results.
Over the last decade, the Center for Medicare and Medicaid Innovation has launched more than 50 models, with only six delivering savings and two demonstrating improved quality. I like the concept of value-based care; it’s just the implementation that is problematic.
With this modest track record, our goal today is to dig deeper into why these models have struggled, identify the success stories, and use lessons learned to improve Medicare payments. One of the primary challenges in achieving genuine value-based care is that we have struggled to define and measure value. Marginal improvements are often treated as high value, and some supposed improvements have not been validated as indicators of genuine clinical improvement. While providers are asked to report reams of data, it is unclear whether we are collecting the right information or using appropriate methodologies to analyze it.
Some of us sat in this same room and heard the grand promise of a Medicare Advantage program that would give us the greatest value by expanding beneficiary choices, reducing health inequities, and saving taxpayer dollars. More for less—it certainly sounded like an unquestionable advantage, but when implemented, it not only failed to achieve the promise but has cost Medicare billions more while providing lower-quality care for many.
Costing an average of 22% more than if the same beneficiaries were in Traditional Medicare, MA is being dramatically overpaid. $83 billion in wasted taxpayer dollars this year alone. That is enough money to provide hearing and vision coverage to the nearly half of beneficiaries with hearing loss and the one-third who struggle to see.
MA plans aren’t just getting paid more to deliver the same care you would receive under Traditional Medicare. They are often covering less care. MA plans continue to interfere with the doctor-patient relationship through burdensome prior authorization requirements, step therapy, and other management tools. One study found 82% of prior authorization denials that were appealed were ultimately overturned and found to be necessary and appropriate.
For the care that is delivered, many physicians face inadequate payment. Shockingly, private MA plans are not required to reimburse at the same payment rates as Traditional Medicare. I continue to hear from hospitals and doctors back home who are paid 20% less by MA than what Traditional Medicare pays.
So, we have higher spending, skimping of care, and underpaid doctors—all under the brand of value. While some alternative payment models appear to show greater promise and achieve the outcomes we aim for, they must be carefully designed to avoid repeating the failures in Medicare Advantage.
These models also should not serve as the back door to greater privatization of Medicare. I share the concern of many Austinites who have contacted me in opposition to the ACO REACH model, which has allowed some entities convicted of fraud to participate. One review of the model found at least 10 companies convicted of fraud, including four Medicare Advantage insurers convicted of hundreds of millions of dollars of fraud for submitting unsupported diagnoses codes to receive inflated payments. Similarly, private equity owned practices and management companies continue to expand in Medicare through alternative payment models.
As part of today’s discussion, we do need greater attention on improving the Medicare Physician Fee Schedule. Providers rightfully want to see payments keep pace with inflationary costs, as recommended by the independent Medicare Payment Advisory Commission. We also continue to underpay primary care providers, who offer some of the most important and high value preventative care. And of course, Medicare Advantage plans, which now cover more than half of beneficiaries, may reimburse less than the Fee Schedule. To achieve greater value, payment reform must include MA reform.
I look forward to today’s discussion on how to protect taxpayer dollars and ensure responsible spending, fair provider payment, and improved health outcomes.
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