Among both supporters and opponents of the recently passed health reform legislation, there is widespread agreement on the necessity of revamping the health care delivery system. But our current system of educating physicians and other medical providers is likely not up to the challenge of producing professionals who will lead the needed changes.

So said Medicare Payment Advisory Commission Executive Director Mark Miller at a June 15 briefing. Miller spoke at a briefing marking the release of MedPAC’s June 2010 report to Congress, “Aligning Incentives In Medicare.” The briefing was cosponsored by MedPAC, an independent Congressional agency which advises Congress on issues related to the Medicare program, and Health Affairs.

“One of the things that we’ve been really focused on is reforming Medicare’s delivery systems and payment systems,” Miller said. These systems are fragmented and focused on the volume of services provided, and we’re trying “to focus more on quality, coordination, and restraining cost.” MedPAC has gone at this in many different ways, through ideas ranging from a public-private entity for comparative effectiveness research to public reporting of quality to pilots for bundling services and medical homes. The June report picks up the theme in several different ways. One item is in the report is graduate medical education (GME), which Medicare subsidizes to the tune of $9 billion annually.

The report also discusses whether the Centers for Medicare and Medicaid Services needs more flexibility in running the Medicare program. (Miller noted that the Patient Protection and Affordable Care Act picked up earlier MedPAC ideas about streamlining the process of starting and expanding pilots and demonstrations). Other topics in the report include coordinating care for seniors eligible for both Medicare and Medicaid and educating beneficiaries to have more constructive conversations with providers about their options (the notion of “shared decision making.” This post will focus on MedPAC’s GME discussions, leaving the other topics to later posts.

“Performance-based” GME funding. In the June report, MedPAC recommends setting aside $3.5 billion in Medicare GME subsidies for residency programs focusing on elements that are too often missing or deemphasized in current programs: providing care not just in hospitals but in physicians’ offices, nursing homes, clinics, and other outpatient settings; coordinating care; working in multidisciplinary teams; utilizing quality metrics; and employing health information technology. Miller referred to this as “performance-based” GME funding.

Independent, Forward-Looking Workforce Analysis. MedPAC is also calling for independent research on how many health professionals, and what sort of health professionals, will be needed in a reformed health care system marked by coordination and a focus on quality rather than fragmentation and a focus on volume. “Right now, that information is not produced in a way that is truly independent,” Miller said. Also, “it generally pivots off of current delivery and practice of medicine. What the Commission is looking for is analysis of workforce needs making assumptions under reformed delivery system.”

(The MedPAC report cites a 2004 Health Affairs article by Dartmouth’s David Goodman, “Do We Need More Physicians?” as an example of analysis finding that “efficient, high-quality systems can have lower physician-to-population ratios.” Readers may also be interested in related Health Affairs articles by Goodman from 2005 (“The Physician Workforce Crisis: Where Is The Evidence?”) and 2006 (“End-Of-Life Care At Academic Medical Centers: Implications For Future Workforce Requirements”)

Areas for additional research. Miller described two other workforce-related topics identified by MedPAC as requiring additional research. First, he said, research has indicated that increasing the diversity of the health care workforce – in terms of race, income, and geographic origin – can produce more physicians and other providers willing to enter primary care and to serve underserved areas and populations. Several federal programs aim to promote a more diverse health care workforce, “but there has never been a systematic evaluation of what works and what doesn’t.” The Commission believes that such a comprehensive analysis is needed.

Second, Miller said, MedPAC is already looking into a study of the relative economics for hospitals of residencies in various practice areas. He explained: “There’s always been this question of whether Medicare should subsidize residencies differentially: more for primary care, less for specialty. The line of reasoning behind this is that a hospital might be willing to use its own resources to support a residency program if it generates revenue for the hospital.” Thus, for the government to decide how much to support various residencies, it needs to know which residencies are profitable for hospitals and which are not.