Medicare incentive programs pay millions to practices

Washington -- Incentive payments resulted in millions of dollars being distributed among hundreds of physician practices that participated in health care delivery demonstration models the Centers for Medicare & Medicaid Services is testing.

More than 500 small and solo practices taking part in the Medicare Care Management Performance demonstration are being awarded about $9.5 million in incentive payments for providing high-quality preventive care and treating chronic illnesses. The average payment per practice is $18,100, but some practices earned as much as $62,500.

The main goal of the project, which just finished its second year, is to promote the use of health information technology to improve the quality of care for beneficiaries with chronic conditions. One in four practices was able to secure an additional bonus for submitting at least some of the measures from a certified electronic medical record, CMS announced Dec. 9, 2010.

Ten physician groups participating in the Physician Group Practice demonstration project, in its fourth year, reached the benchmark performance levels on at least 29 of 32 measures reported. Three groups -- Geisinger Clinic in Danville, Pa.; Marshfield (Wis.) Clinic; and Park Nicollet Health Services in St. Louis Park, Minn. -- achieved benchmark performance levels on all 32 measures.

Five physician groups will receive performance payments totaling $31.7 million, CMS said. Under the project, groups earn the payments based on the quality of care they provide and the estimated savings they generate for Medicare.

A third program, the Hospital Quality Incentive demonstration, awarded incentive payments totaling $12 million to 212 hospitals for quality improvements. CMS has awarded more than $48 million to top performers during the five years the project has been running.

CMS Administrator Donald M. Berwick, MD, said the results provide strong evidence that offering physicians and hospitals incentives for quality can help reduce Medicare spending.

"This is good news for all Americans," he said. "But it's just a start. Based on what we have learned so far, we know the health care industry can meet high standards for improving quality of care while saving Medicare money."