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Phase In P4P Over Time, Societies Urge Congress


Pay for performance (P4P) is incompatible with the current Medicare physician payment formula, which calls for cuts of close to 5 percent for the next six years, physicians insist.

The American Medical Association and 68 other medical societies wrote to House Ways and Means Chairman Bill Thomas (R-CA) and Senate Finance Chair Charles Grassley (R-IA) to support a phased-in approach to P4P. Under the societies' framework, the current formula would be replaced with positive annual updates based on the Medicare Economic Index (MEI).

Physicians would receive bonus payments in 2007 for reporting data on information technology and patient safety measures, according to the Aug. 23 letter. Then in 2008 and 2009, they would receive payments for reporting evidence-based quality data, and also for participating in "more advanced quality improvement programs."

Finally, in 2010, physicians would receive bonuses for performance in "evidence-based" measures and outcomes, with adequate risk adjustment and sample size. But under the AMA plan, physicians would always be guaranteed a "floor" of positive updates even if they didn't receive any P4P bonuses.

The AMA phase-in plan is similar in some ways to the bill introduced by Rep. Nancy Johnson (R-CT), except for the longer phase-in time and the guaranteed positive floor.