Payment Shifts: Expect reimbursement structure changes ahead, policy experts say

San Francisco, Calif.—Although the new U.S. health care law does not specifically alter the current fee-for-service payment structure, changes to how physicians and hospitals will be reimbursed for services are under construction. These changes are reflected by the growing focus on the development and implementation of quality improvement and physician and institutional performance measures on which reimbursement will increasingly be made, panelists said here on Sept. 11 at the 2011 American Academy of Otolaryngology-Head and Neck Surgery (AAO-HNS) Annual Meeting.

“The payment landscape is shifting from fee-for-service to fee-for-value, with value defined in broad terms as higher quality care at a lower cost” said Jane Dillon, MD, vice chair of Advocate Physician Partners, a Chicago-area physician hospital organization. “Otolaryngologists need to recognize this reality and identify opportunities for participation in this paradigm shift.”

To meet the challenges posed by this shifting payment landscape, the AAO-HNS is working on behalf of its members to ensure appropriate reimbursement for services and new technologies and to advocate for reimbursement where questioned.

Physician Payment Policy Committee (3P)

The Physician Payment Policy Committee, or 3P, was formed to manage, monitor, and direct key issues that affect members with respect to reimbursement and CPT-related problems. Michael Setzen, MD, AAO-HNS Coordinator for Practice Affairs, co-chair of 3P and president of the American Rhinologic Society, explained that the committee is composed of representatives from all branches of otolaryngology and subspecialties. A primary aim of the committee, he said, is to generate consensus in order to present a united front to insurance carriers in discussions related to reimbursement issues.

If reimbursement is sought for a service or procedure involving rhinology, for example, 3P will conduct an evidence-based review of all the relevant published literature, and then pass the review on to the different subspecialty AAO-HNS committees. In this case, the review goes to the Rhinology and Paranasal Sinus Committee and the appropriate subspecialty society such as the American Rhinologic Society, which conducts a final review and comment. All comments are returned to 3P, which then drafts a final document that is sent to insurance companies after review and approval by the AAO-HNS Board of Directors.

It also works in the opposite direction, Dr. Setzen explained. “If an insurance carrier draws up a guideline and we disagree with it, 3P reviews it and engages the appropriate subspecialty society and AAO-HNS committee for comment before finalizing a response, passing it by the board for approval and engaging the insurance company in a discussion,” he said.