Physician practices that serve a disproportionate number of high-risk patients are at an increased risk of financial penalties from value-based payment programs, according to an August 1, 2017, original investigation in JAMA. The authors conducted an observational study on Medicare's Physician Value-Based Payment Modifier and compared quality and cost scores based on a composite of individual measures from patients with varying degree of social and medical risk. Practices were declared either low risk; high social risk (those serving the highest percentage of patients with dual eligibility for Medicare and Medicaid); high medical risk (those serving a population in the top quartile of mean Hierarchical Condition Category risk score among fee-for-service beneficiaries); or both. Among 899 physician practices, 547 were labeled as low risk, 128 were high medical risk only, 102 were high social risk only, and 122 were high medical and social risk. Practices classified as low risk had better composite quality scores than any of the other three classifications. Those in the high medical risk category performed better on quality measures than those in high social risk, which performed better than practices that were both high medical and social risks. Costs were, however, lowest among the high social risk practices ($8,214 total per capita costs). The low risk practices had per capita costs of $9,506, the combined risk group had per capita costs of $11,692, and the high medical risk practices had per capita costs of $13,683. “These patterns were associated with fewer bonuses and more penalties for high-risk practices," the authors said.
HRC Recommends: Whether value-based purchasing programs lead to improved quality is an open question; recent studies suggest that they, as currently configured, may not (see HRC Alerts, June 21, 2017, Has Value-Based Purchasing Led to Improved Quality?). Beyond questions about care quality, this study suggests that factors outside the provider's control, such as the patient's social and medical risks, may have a further impact on providers' reimbursement. Providers should work to understand patients' social and medical risks so that they can be better anticipated and mitigated.