HOW DOES OBAMACARE AFFECT PROVIDERS?

The major provisions of the Affordable Care Act that affect providers are explored in below.

Medicare Payment Reform

The primary Obamacare provision that impacts medical providers is Medicare payment reform. The ACA plans to save money by reducing Medicare spending in a number of ways, many of which will affect healthcare providers. Since Medicare reimbursement usually serves as a basis for private payor reimbursement, these changes could have a drastic affect on how providers are reimbursed for services. Perhaps the most well known example of Medicare payment reform is the Accountable Care Organization reimbursement model. Two other examples are the Medicare hospital value based purchasing program in which Medicare is attempting to pay hospitals based on quality measure performance and the Bundled Payments for Care Improvement (BCPI) initiative in which Medicare is bundling payments based on episodes of care as opposed to paying for services individually.

Most healthcare reimbursement reform efforts, including these ACA initiatives, aim to increase the quality of medical care while lowering the cost of care. These days, the focus of much reform has been proposing alternatives to fee-for-service reimbursement, which some see as the cause of high medical costs because it encourages providers to perform as many procedures as possible regardless of whether or not they are completely necessary. A legitimate fear is that other payment models create the opposite incentive, which is to not provide all necessary services. Whatever the case may be, large and powerful providers with strong bottom lines seem to be better positioned to handle payment reform and the decreasing reimbursements that appear to be coming with it.

Quality Initiatives

There are many quality initiatives that are tied into the ACA, including the hospital value based purchasing program and the Physician Quality Reporting Initiative (PQRI). These quality initiatives clearly have a good purpose, which is to increase the quality of medical care for patients. Unfortunately, they also place a new burden on providers to report on the necessary quality measures and other metrics. Some providers have the resources and capabilities to accomplish this without issue, while others struggle with the infrastructure and manpower necessary to comply.

Primary Care Physician Reimbursement

Primary Care Physicians have had their Medicaid payments increased to 100% of Medicare rates for 2013 and 2014 and have been provided a 10% bonus payment from Medicare in 2011 through 2015. This is clearly great for PCP's and reinforces many people's belief that quality primary care and preventive services can have far-reaching positive impacts in healthcare.

Hospital Reimbursement

Hospitals are facing potential Medicare payment reductions if they have excessive hospital readmissions (effective in 2012) and if their patients obtain certain hospital-acquired conditions (effective in 2015). These requirements seem to be in step with the philosophy of tying reimbursement to quality.

Essential QSA Knowledge

Regardless of one's opinion of the Affordable Care Act, the reality is that it places many new requirements and uncertainty on medical providers. The motives behind these provisions are good, mostly to rein in medical costs and increase quality of care. However, the unexpected result may be that only large providers with vast resources are able to remain viable with the reimbursement changes, quality reporting, and other requirements. This would be unfortunate from a patient's perspective because it would mean that the variety of choices available when seeking care would be diminished, and access to care and patient service may suffer. Many times innovative and patient-oriented provider models that differ from traditional practices start out small and need to stay viable in order to gain traction. Urgent care centers are a good example of this. The first urgent care center was opened in the 1970's, and now they have proliferated to thousands of locations throughout the United States.

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