Alternate Payment Model – The Health Care Blog

It’s Money That Changes Everything (Or Doesn’t) For Surgeons

Jan 30, 2025

By MICHAEL MILLENSON

“Money changes everything,” Cyndi Lauper famously sang about love to a pulsating rock ‘n’ roll beat. So, too, when it comes to financial incentives for surgeons, two new studies suggest, although “How much money?” and “What do I have to do?” are the keys to unlocking monetary motivation.

The first study, a JAMA research letter, examined the impact of a new Medicare billing code for abdominal hernia repair that paid surgeons more if the hernia measured at least 3 centimeters in size. Previously, “size was not linked to hernia reimbursement,” noted University of Michigan researchers.

Surprise! The percentage of patients said to have smaller, lower-payment hernias dropped from 60% to 49% in just one year. Were “small hernia” patients being denied care? Nope. Were surgeons perhaps more precise in measuring hernia size? Maybe. Or possibly, wrote the researchers in careful academic language, “the coding change may have induced surgeons to overestimate hernia size.” Ambiguous tasks, they added, “can be conducive to perceptive [cq] bias and potentially even dishonest behavior, perhaps more so with financial incentives at play.”

This being an academic publication, two footnotes informed us that dangling money in front of our eyes can cause people to “see what you want to see” and come up with an “elastic justification” for truth.

If a simple coding change can apparently boost the number of large-hernia patients by 18% in just one year, what about a payment incentive meant to induce more urologists to follow the medical evidence on low-risk prostate cancer and adopt “active surveillance” (formerly known as “watchful waiting”), rather putting patients through a painful and expensive regimen of biopsies and surgery?

A second study, also in Michigan, involved commercial and Medicare-age members of the state’s Blue Cross and Blue Shield plan. However, after three years and more than 15,000 patients, “the payment incentive was not associated with increased surveillance use among patients with low-risk disease,” researchers concluded in a JAMA Network Open article.

MACRA Is Broken. It Needs to Go Away Now.

Apr 15, 2017• 17

By KIP SULLIVAN

At its January 12, 2017 meeting, the Medicare Payment Advisory Commission (MedPAC) made it clear they had reached the conclusion that the Merit-based Incentive Payment System (MIPS) cannot work (see my last post ). MIPS is the larger of the two programs within MACRA; the Alternative Payment Model (APM) program is the other. The commission’s primary rationale for its conclusion about MIPS is that it’s not possible to measure physician “merit” (cost and quality) at the individual physician level.

But rather than recommend that Congress repeal MACRA (the Medicare Access and CHIP Reauthorization Act), MedPAC decided to try to fix it. At the January and March 2 meetings, the commissioners discussed a staff proposal to amend MIPS substantially and to tweak the APM program. Those discussions went nowhere.

I give MedPAC credit for finally stating unequivocally that MIPS cannot work. But MedPAC should never have volunteered to fix MACRA. It can’t be done. By proposing modest amendments to MACRA and thereby implying it’s fixable, they stepped into an intellectual tar pit. I will illuminate this tar pit by describing the commission’s unproductive discussion about the staff’s proposed amendments to MACRA. To give you a sneak preview of what that discussion was like, I give you two excerpts from the transcript of the January meeting: