Force Medicare "reform" without proof that it will work?

The Washington Post reports on the latest findings of the "Medicare Payment Advisory Commission" (MedPAC) today. According to the WaPo, this is a "commission that advises Congress on the federal medical program for older Americans."

In other reports, there is mention that President Obama plans - at the same time - to cut Medicare and Medicaid funding by over $900 Billion dollars, to somehow expand the numbers of Americans who are given "guaranteed health care" under some government "public plan," and to pay for any expansion by taxing insurance benefits given by employers.

And it all has to be done in the next two weeks:

For months, Obama remained on the sidelines of the health-care debate because "he felt it was important to not be too proscriptive," Axelrod said in an interview. "Now we're into a different phase, where decisions are being made very quickly, so it's time to weigh in to a greater degree."

The Obama strategy, articulated in the speech here and in a series of private meetings, is to present each major stakeholder with an enticement in return for a bit of sacrifice.

Again, there's mention of "accountable care organizations," and how to force doctors into them. This time, we do learn that coercion will be necessary to form these organizations and that there's evidence that these sort of interventions don't save money or improve the health care of patients caught up in the schemes. In fact, some of these interventions are now considered wasteful and the first place to cut:

To illustrate what it might take to save Medicare, the commission describes how primary-care doctors, specialists and hospitals could be reorganized into "accountable care organizations" whose members would receive bonuses if the organizations met quality and cost targets. To ratchet up the incentives, health-care providers that fail to meet cost and quality targets could be penalized, the report says.

Even then, any projected savings would be highly uncertain, the report says. What is certain is that Medicare cannot maintain its current trajectory, it adds:

"If current spending and utilization trends continue, the Medicare program is fiscally unsustainable. . . . Part of the problem is that Medicare's fee-for-service payment systems reward more care -- and more complex care -- without regard to the quality or value of that care."

The report underscores the challenges facing President Obama and Congress as they seek to overhaul the health-care economy. The administration has put a spotlight on what it considers wasteful spending, but it has offered sparse details as to how it would change the incentives that produce the waste.

The report identifies some areas that are ripe for savings. MedPAC estimates that the government is paying private Medicare health plans -- which were supposed to save the government money -- much more than it should. In addition, the government could save money by adopting a more streamlined approval process for "follow-on biologics" -- products that imitate biotech treatments already on the market.

Getting doctors to join accountable care organizations may require pressure, MedPAC Executive Director Mark E. Miller told reporters: "If you want people to voluntarily organize, you may want to make sure that the current system isn't as pleasant a place to be."

The model for accountable care organizations resembles that of large, tightly managed physician groups, practices that have been the subject of demonstration projects, and Medicare's experience with those offers limited encouragement, according to the report. Measurable quality improved in the areas of care monitored, such as for diabetes and congestive heart failure. But "whether the demonstration has actually generated savings for the Medicare program is debatable," the report says.

Policymakers hope that money can be saved by better coordinating care. But, according to the MedPAC report, Medicare pilot programs intended to coordinate care for patients with chronic diseases -- programs that involved insurance companies and other private groups -- generally achieved modest quality improvements. Most of the programs cost Medicare more money than it would have spent without them, the report says.