Drowning in bureaucracy

As Washington debates how to pay for healthcare, a law going into effect this year reflects one major reason the bill is so high. The Medicare Access and CHIP [Children’s Health Insurance Program] Reauthorization Act redefines how the government will pay doctors for treating the 56 million people covered by Medicare. Known as MACRA, the legislation sought to reward doctors for taking good care of patients. Instead, it has increased bureaucracy.

In a 2013 Harvard Business Review article, researcher Robert Kocher analyzed employment data and identified an average of 16 “non-doctor workers” in healthcare for each doctor. Six of them—nurses, physical therapists, aides, and so on—take care of sick people, but the other 10 do not: Many simply work to satisfy an alphabet soup of government mandates.

More workers will do so under MACRA, as most doctors conform to the law’s Merit-based Incentive Payment System (MIPS). The name sounds positive, but that “incentive” can be what Medicare delicately terms a “negative payment adjustment”: It’s a carrot for doctors who do what MACRA specifies and a stick for those who don’t. MIPS lays out four categories, and Medicare reimbursement will depend increasingly on the grades doctors receive in each one.

The first category, simply called “quality,” is based on the former Physician Quality Reporting System (PQRS). While the “quality measure” goals are generally praiseworthy—controlling diabetics’ blood sugar, promoting preventive care—the end result is massive effort spent reporting six different measures on at least half the patients a doctor sees. The American Academy of Family Physicians points out on its website that none of this actually measures quality, and it has called the PQRS “pay-for-reporting, not pay-for-performance.” There’s plenty of reporting to do: Last year, a team of medical researchers in New York and Colorado calculated that American medical workers in four common specialties spend an average of 785 hours each year, per physician, reporting government-mandated “quality measures.”

The second category, “advancing clinical information,” mandates doctors use electronic health record (EHR) systems certified by the federal government. Many otherwise wouldn’t: EHRs replace familiar, reliable paper charts with computers, and the effort required to fill out charts electronically leads to patient complaints that “the doctor looked at his computer more than me.” They also require massive investments in hardware, software, backup systems, and information technology staff: A 2011 study in Health Affairs estimated the total cost for a five-doctor group’s first year of EHR adoption to be $247,500.

The third category involves yet more staff—this time for assorted “clinical practice improvement activities.” Doctors must choose four, and attest that they’ve done them for at least 90 days each. As with the first measure, the problem is not the goals, but the contortions required to prove doctors have reached them. Many of the activities involve “qualified clinical data registries,” “action plans,” “implementation of improvements,” and other time-consuming distractions from clinical work.

The fourth category, ironically, deals with how much each doctor costs Medicare. MACRA’s cost controls apply only to the practice of medicine: Medicare does not propose reducing what EHR vendors can charge for software or what clinical data registries receive for their services. Health and Human Services Secretary Tom Price appears to understand the contradiction, lamenting in a June industry talk that “we’ve turned a lot of folks in the healthcare professions into data entry clerks.”

Price recently proposed changes to MACRA giving more doctors an exemption from the MIPS reporting rules and relaxing those rules for most others. Those changes would be a limited, bureaucratic victory—and perhaps President Donald Trump’s biggest healthcare victory to date.