Health Law and Policy Survey

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A Q&A with Don Crane
President and CEO, America’s Physician Groups


“We hope we see a new shot in the arm in the value movement coming out of the innovation center. That’s potentially the most important development in the move from volume to value, which we are all highly invested in.”

– Don Crane



Don Crane is the President and CEO of America’s Physician Groups, the nation’s leading professional association representing medical groups and independent practice associations. Since joining America’s Physician Groups in 2001, Crane has expanded the organization to a national association of more than 300 physician groups in 45 states, the District of Columbia and Puerto Rico.

We spoke to Crane in the leadup to our 2019 National Symposium on Health Law and Policy to discuss the way alternative payment models and trends in physician alignment are driving change in – and being changed by – the evolving policy landscape. The conversation has been edited for clarity.

Q: What are the most pressing challenges faced by your sector of the health care industry? What issues are affecting America’s Physician Groups?

A: High on the list is the need for additional alternate payment models. We’re all watching with high levels of interest what comes out of the Center for Medicare & Medicaid Innovation in the way of new payment models. As goes Medicare so goes the rest of the market.

Under the Medicare Access and CHIP Reauthorization Act of 2015, physicians’ groups are faced with two choices: they either participate in the Merit-based Incentive Payment System, which is not that attractive for a variety of reasons, or they participate by an alternative payment model. If they do that, they get more money in terms of shared savings plus a five percent bonus on the rest of their original Medicare population. Looking at that picture, they don’t have a lot of strong choices now among the alternative payment models. It’s mostly in the Accountable Care Organization program which has produced mixed results in the eyes of physician groups.

We hope we see a new shot in the arm in the value movement coming out of the innovation center. That’s potentially the most important development in the move from volume to value, which we are all highly invested in.

Q: Is the direction of alternative payment models having an impact on physician alignment?

A: Yes of course. They have the effect of aligning physicians, aggregating physicians into organizations, whether they’re called ACOs or medical groups or something else.

I would quickly distinguish between the right kinds of alignment and the wrong kind of alignment.

We want high levels of integration. There’s the right kind, where it’s population-based, subject to payment, capitation and risk sharing. Where it’s not the right kind of integration, it’s a consolidation that’s designed in truth to drive more fee-for-service volume and otherwise create opportunities for monopolization and increased pricing. The two do need to be distinguished, and I’m not sure they are adequately distinguished inside and outside of California right now.

It’s a very understandable reaction of hospitals and hospital systems to move away from just inpatient care to in- and out-patient care in response to the call for integration. Sometimes it yields very good results, higher levels of clinical integration and lower costs, but in many instances, we’ve seen it produce the opposite. That’s a fine distinction but a very critical one going forward.

Q: In the move to value-based care, what are the major changes you see in the near term?

A: The market and science are conspiring to drive care into more appropriate settings, generally, and more specifically the home. Much in-patient recovery can be done at home where it used to be done in the medical-surgical units of hospitals. Admissions can be totally avoided by this movement toward home care. We have technology that enables that. We know that it’s sometimes a safer and better environment. And that’s happening naturally, through science, patient demand and purchaser demand. The movement from volume to value is now deeply ensconced in policy, and even in the minds of purchasers – even the commercial ones. That is a big influencer of what’s going on.

Q: Can we expect more or less scrutiny of fraud and abuse in healthcare?

A: Many of us who follow these things view both the fraud and abuse laws and the self-referral laws as being sort of legacy in nature, appropriately suited in yesteryear to a fee-for-service world where the abuses had a way of generating more volume, more work and, obviously, more spend. As we’ve evolved further into pre-paid models those fraud and abuse laws don’t fit as well. We now want more clinical integration and even more business operational and financial integration. So, some of those existing laws are a barrier to some of the development we all want.

There is still going to be a high level of scrutiny for outright larceny. Where you’ve got intentional fraudulent billing by a physician or a hospital or a durable medical equipment provider that can and should be pursued and prosecuted.

Self-referral laws should be modified; probably, in a word, modernized. Our position is that arrangements that cause providers to work together under capitated models should be per se permissible because there is no motivation to increase volume where it’s not warranted under a capitated model. The financial incentive is, arguably, to deliver less care rather than more care. Where there’s the right payment model and the right arrangement between participants in a transaction, they should be permitted almost in an unfettered manner. Where there’s fee-for-service, we must be suspicious because always in fee-for-service there’s an incentive to do more or higher intensity. Its fee-for-service that produces the problems with fraud and abuse. Capitated models do not.

Crane will be speaking on physician alignment and health care payments at our National Symposium on Health Law and Policy on February 11, 2019.

To see the Q&A with The Honorable Mark Parkinson, President and CEO, American Health Care Association and National Center for Assisted Living, please click here.

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