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Effects of proposed primary care incentive payments on average physician Medicare revenue and total Medicare allowed charges

The US Senate Finance Committee and the Medicare Payment Advisory commission have both proposed incentive payments for primary care physicians who meet certain thresholds of "primary care-ness." With the support of the AAFP Foundation, the Graham Center analyzed how many physicians would meet proposed thresholds, and the potential impact on both physician revenue and Medicare costs. A 60% threshold (60% of claims dollars are for home, nursing home, or office visits) will capture about 60% of family physicians but only 40% of general internists. This suggests that a substantial bonus may influence more primary care physicians to deliver more primary care. But because it excludes more rural physicians than urban, these threshold codes may also be excluding physicians doing a broader scope of appropriate primary care. We do not yet suggest additional codes to be considered but suggest that Congress and the Administration need to re-evaluate their choices to avoid the unintended consequence of overly restricting the range of services needed for the Patient Centered Medical Home.

May 2009