Care Coordination

Rewarding providers on the basis of performance will require that Medicare know which providers delivered care to specific patients. Patients frequently interact with more than one provider, and treatment of complex conditions often requires consultation with multiple specialists. On average, Medicare beneficiaries are treated annually by 5 physicians; beneficiaries with the chronic conditions of chronic heart failure, coronary artery disease, and diabetes see an average of 13 physicians annually. Enhancing care coordination is essential to improving quality.

Recommendation 8: The Centers for Medicare and Medicaid Services (CMS) should design the Medicare pay-for-performance program to include components that promote, recognize, and reward improved coordination of care across providers and through entire episodes of illness. Thus, CMS should (1) encourage beneficiaries and providers to identify providers who would be considered their principal responsible source of care, and (2) pay for and reward successful care coordination that meets specified standards for providers who take on that role.

Not all providers treating Medicare beneficiaries would be willing or able to provide this coordinating function; thus CMS should design a strategy to reward those who are capable of and willing to assume this role. Beneficiaries should be encouraged to designate their responsible sources of care through incentives such as reductions in their Medicare Part B premiums. All such activities should protect patient confidentiality and be carried out in compliance with regulations of the Health Insurance Portability and Accountability Act.

Information Technology

Information technology has enormous potential to be used as a transformative tool in systems change toward improving the quality of health care. Pay for performance can influence the rate of information technology adoption, but information technologies are not a necessary component of pay for performance. While promising, the infrastructure required to automate patient-specific clinical information has not yet fully been embraced. Without clear standards, experimentation will likely continue slowly, in a piecemeal fashion.

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