GAINSHARING
At the end 2006, the Centers for Medicare and Medicaid Services (CMS) announced that it will be conducting two gainsharing demonstration programs in an attempt to improve patient care and generate greater efficiencies for hospitals. The gainsharing demos, if properly structured, would provide financial incentives to physicians for enhanced clinical practices that improve patient outcomes.
MDMA’s concern is that the demonstration programs may be structured in way that would encourage physicians to limit the kinds of medical devices used in treating patients or to limit actual care. Doctors would then receive a percentage of the total cost “savings.” MDMA will continue to educate lawmakers, the Administration, and the industry on the pitfalls of device contract gainsharing (DCG) and oppose any attempts to implement device contract gainsharing.
What is MDMA doing?
MDMA has been busy educating members of Congress and the Administration about the risks of DCG arrangements and has organized multiple fly-ins for its members and other stakeholders to meet with lawmakers. MDMA is the only device association that has been actively opposed to any gainsharing demonstration project that included devices. Many of MDMA’s member companies also participate in the association’s gainsharing task force, providing input, shaping policy, and playing an important role with efforts in Washington. Lawmakers must hear from device manufacturers and physicians – device contract gainsharing will be dangerous for patients and detrimental to the future of device development. If sanctioned, DCG will decrease quality for patient care, compromise the physician-patient relationship, and stifle innovation driven by smaller, entrepreneurial medical device companies
MDMA’s Hill Policy Paper on Gainsharing
Two documents created by Orthoknow TM readers illustrating the essence of conflicts inherent with gainsharing:
Medical Product Outsourcing Article on Gainsharing
http://mpo-mag.com/current_issue/on_the_hill.php
Orthopedic Product News Article About Gainsharing (pages 8-10)
http://orthoknow.com/us_opn-2005-07.pdf
2006
CMS Announces Gainsharing Demonstration
September 6th -- CMS announced a Physician-Hospital Collaboration Demonstration. Dr. McClellan said, "This is very different from traditional 'gainsharing' with its short-term focus. We are aiming to support the best efforts of physicians and hospitals to improve quality and efficiency in the overall care for their patients." However, MDMA is concerned that if not properly implemented, this demo could adversely impact patient care and innovation. MDMA will continue to work with CMS and the Hill to ensure that this program does not provide perverse incentives to physicians to use a particular brand of product or to limit appropriate care. Click here for more information.
AMA Signs Pact with Congress to Develop Performance Measures
February 28th -- The American Medical Association (AMA), the Administration and Congress recently announced an agreement to develop a total of approximately 140 physician performance measures covering 34 clinical areas. Doctors would then report to the federal government in an effort to improve the quality of care administered by physicians. The pact came as an effort to push pay-for-performance arrangements with various health care providers in order to publicize their performance and link Medicare payment to quality. However, according to some critics, the timeline given to develop the performance measures is too short. Critics also urged that the performance measures need to be developed by specialty societies, tested, and validated to determine their true effect on patient care. Physician groups also have cautioned Congress and CMS that one set of quality measures will not work for all medical specialties. The AMA recently sent a letter to specialty physicians stating that the AMA has not agreed to a pay-for-performance system without accompanying changes in Medicare reimbursement.
"MDMA supports efforts to develop quality measure in health care. However, given the lack of current uniform performance measures related to quality, it is premature to move forward with gainsharing arrangements that claim to be able to limit physician choice without compromising quality," said Mark B. Leahey, Executive Director of MDMA. "If we can’t agree on how to measure quality, how can we be assured patients won’t be harmed under gainsharing?"
Gainsharing Demonstration Included in the Deficit Reduction Act
February 10th— On February 6th, the President signed the Deficit Reduction Act into law. This law included language permitting a limited gainsharing demonstration program. Specifically, the demonstration project provides broad discretion to HHS (and CMS) on how the program will be structured, rather than the more prescriptive approach outlined in earlier draft bills. MDMA continues to work with the Hill and CMS to ensure that any gainsharing demo does not provide incentives to physicians for limiting their access to technologies or limiting care.
Gainsharing Demo in House-passed bill
February 3rd—Earlier this week, the House voted to pass the Deficit Reduction Act (DRA) by a close vote of 216-214. This legislation is intended to save $39 billion over five years and $99 billion in the next decade. However, included within the legislation, is a gainsharing demonstration program. Specifically, the demonstration project provides broad discretion to HHS (and CMS) on how the program will be structured, rather than the more prescriptive approach outlined in earlier draft bills. MDMA continues to work with the Hill and CMS to ensure that any gainsharing demo does not provide incentives to physicians for limiting their access to technologies or limiting care.
2005
Gainsharing Demo Included in Last-minute Budget Negotiations
On December 21st , the Senate passed the Budget Reconciliation Bill by a vote of 51-50 with Vice President Cheney casting the tie-breaking vote. Unfortunately, Congresswoman Nancy Johnson (R-CT) was able to include into a provision calling for the Department of Health and Human Services to implement a gainsharing demonstration project. However, points of order (which are made during floor proceedings to assert that procedural rules are being violated) were raised and sustained, so the House will have to vote on the Senate version of the bill before it is signed into law by the President. This is expected to happen in January.
Since February, 2005, MDMA has raised concerns about the impact gainsharing will have on patient care and medical device innovation. Moving forward, we will work with HHS and the Hill as the demonstrations are developed to ensure that patient care and innovation are not harmed.
MDMA submits congressional testimony in response to the House Ways and Means Hearing on Gainsharing.
On October 7th, the House Ways and Means Subcommittee on Health held a hearing on gainsharing. MDMA is opposed to any form of device contract gainsharing (DCG) and submitted a statement for the record expressing the negative impact that legalizing device contract gainsharing will have on patient care and the entrepreneurial, innovative medical device sector.
To read the testimony we submitted, please click here.
House Ways and Means Subcommittee on Health Holds Hearing on Gainsharing
On Friday, October 7, 2005 the Ways and Means Subcommittee on Health held a hearing on Gainsharing. MDMA views gainsharing as a concept in which a hospital would share with a physician a percentage of the savings they achieve from standardization of devices and reduced utilization of certain devices and procedures. Seven witnesses testified including the Office of the Inspector General (OIG).
