Physicians for a National Health Program: Doctors and Health Advocates to HHS Secretary Becerra – End Medicare Direct Contracting, Don't Tweak It
A group of 25,000 physicians and health professionals sent a LETTER to
The doctors, members of Physicians for a
"Direct Contracting Entities (DCEs) and their
On Monday night, members of the DCE industry sent a letter to Sec. Becerra, asking him not to cancel the DC program but to "improve" it by, among other things, implementing unspecified "guardrails."
In response to the industry's letter, PNHP reminded Sec. Becerra that DC has tarnished the reputation of HHS, and ending the program would demonstrate a commitment to improved integrity and the best interests of beneficiaries. The letter points to the conflicts of interest present at the program's inception: DC was developed in 2019 by
PNHP also explained that as long as the program provides a profit motive for DCE middlemen, they will find a way around proposed "guardrails" on abuse. "Our experience from Medicare Advantage (MA) shows that when regulators install new guardrails that threaten profits, the industry will simply build a bigger truck to run them over," the letter said, noting that despite government efforts to rein in fraud, it overpaid MA insurers by more than
Several other advocacy groups called on Sec. Becerra to end, not tweak, the DC program.
"Direct contracting is nothing more than privatizing Medicare," said
"We can't afford even more for-profit middlemen getting between America's seniors and the care they need, especially seniors that chose to avoid Medicare Advantage for a variety of reasons," added
* * *
To: The Honorable
Dear Secretary Becerra,
We are a group of 24,000 physicians and other health professionals who are deeply concerned about a threat to Traditional Medicare (TM).
Last night, a group representing the DCE industry sent you a letter/1 asking you to fix, not end, the program, arguing that ending DC now would undermine the work of the CMS Innovation Center (CMMI). Quite the opposite: DC has tarnished the reputation of CMMI, CMS, and HHS, and ending the program would demonstrate a commitment to improved integrity and the best interests of beneficiaries.
Recently, advocates and journalists have drawn attention to the conflicts of interest present at the program's inception. DC was developed in 2019 by then CMMI director
Limit program participation and increase provider control: The industry, particularly the association of ACOs, suggests that CMMI increase the percentage of providers in each DCE's governing body, currently set at a minimum of 25%./7 However, even with more provider governance, DCEs are ultimately accountable to investors, which include private equity firms and commercial insurers active in MA. Investors want a return on their investment, creating a dangerous incentive for DCEs to both maximize revenues through upcoding, and minimize medical expenditures by restricting patient care.
Add "guardrails": The DCE industry is vague on proposed guardrails, but our experience from Medicare's other managed care experiment, Medicare Advantage (MA), shows that when regulators install new guardrails that threaten profits, the industry will simply build a bigger truck to run them over. For example, MA insurers engage in a kind of fraud called "upcoding/8 ," exaggerating or fabricating patients' diagnoses to earn higher capitation payments. Despite government efforts/9 to crack down, insurers consistently find more sophisticated ways to updcode, such as using AI software to scan patient records for upcoding opportunities, paying/10 doctors to document additional diagnoses, sending insurer- employed nurses to seniors' homes/11 , and buying provider practices/12 outright to control the coding process. As a result, Medicare overpaid MA insurers more than
Add "beneficiary protections": Industry lobbyists are vague about this proposal, but at its core, DC is a bait-and-switch for beneficiaries who chose TM because they value free choice of provider. Medicare "aligns" beneficiaries into a DCE without their full understanding or consent. The DCE then sends beneficiaries an annual notice, marked "No Action Required," which they are unlikely to read or understand. Seniors cannot opt out of a DCE unless they change primary care providers. In addition, the model gives DCEs a strong financial incentive to steer patients to their network of "preferred providers."
Implement a rebranding and name change: Until recently, most Medicare beneficiaries and most members of
From HMOs to Medicare Advantage to
The DCE industry represents its own interests and that of its investors, and does not speak for physicians. As physicians, we urge you to end the dangerous DC program and work tirelessly to strengthen and protect Traditional Medicare, both for today and for generations to come.
Sincerely,
Dr.
View footnotes at: https://pnhp.org/system/assets/uploads/2022/02/PhysicianLetterToSecBecerra_20220215.pdf
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