Developing Resource Use Reports for Medicare Fee-for-Service Claims

Prepared for
U.S. Department of Health and Human Services, Centers for Medicare & Medicaid Services

One facet of health care reform focuses on appropriate incentives to encourage health care providers to deliver high quality care while avoiding unnecessary costs, which is also the underlying principle of value-based purchasing (VBP). Development of a broad array of consensus-based clinical measures, effective resource utilization measures, patient safety and patient experience measures, and payment system redesign are cornerstones of this type of purchasing.

In an effort to move from a passive payer to an active purchaser of high-value health care, the Centers for Medicare & Medicaid Services (CMS) is developing and implementing a number of VBP initiatives in multiple settings of care. The agency-wide VBP initiatives include physician practices, hospitals, nursing homes, home health agencies, and dialysis facilities. Mathematica assisted CMS with designing a system to implement physician VBP for Medicare beneficiaries, which includes development and distribution of confidential physician feedback reports that inform physicians of their performance on quality and cost. Physician feedback reports are one important aspect of VBP designed to spur health care improvements, along with public reporting of physician performance and encouragement of joint accountability among providers for delivering care to a population of beneficiaries.

CMS has been developing and distributing physician feedback reports in phases, in anticipation of a national scale-up of reports for all physicians by 2015. In Phase I, Mathematica expanded the capability of CMS to process Medicare fee-for-service claims through commercial episode grouper products; developed per capita cost measures; explored alternative risk adjustment, attribution, reliability, and benchmarking options; and distributed feedback reports to approximately 230 physicians in 12 diverse sites across the United States to solicit their views on the reports. Participating organizations for Phase I included the Center for Studying Health System Change; Acumen, LLC; Ingenix; and Thomson Reuters.

In Phase II, Mathematica assisted CMS with expanding Phase I measures to include indicators of physician clinical quality, applying measures to broader accountable care entities, and crafting an approach for “scaling-up” the distribution of feedback reports. Phase II reports, tested with a large sample of physicians as in Phase I, were distributed to approximately 2,000 physicians and 40 medical groups in 2010. Additionally, we helped CMS design a physician VBP program, including potential design features for accountable care entities, beneficiary and provider assignment, performance measurement, and a physician payment system based on the value, rather than the volume, of services provided. Phase II participating organizations included the Center for Studying Health System Change; America's Health Insurance Plans; Booz Allen Hamilton; Boston University; Brandeis University; CGI Federal; Ingenix; Iowa Foundation for Medical Care; MassPro; Palmetto, GBA; SAS Institute, Sewell, Inc.; Social & Scientific Systems, Inc.; and Thomson Reuters.

In Phase III, Mathematica continued assisting CMS with producing and disseminating confidential reports that compare patterns of resource use and quality to individual and groups of practitioners to provide feedback and education in order to encourage high quality and efficient medical practices. Over two program years (2010 and 2011), Mathematica increased the number of reports distributed, producing 118,404 physician feedback reports for both individual eligible providers and medical group practices. The reports evolved in both content and design, introducing new quality measures such as the all-cause hospital readmissions measure and incorporating new template designs. The 2011 medical group practice report became the basis for the Quality and Resource Use Reports produced under the Physician Value contract with Northrop Grumman. After each round of feedback reports was distributed to providers, Mathematica provided technical assistance to CMS through a help desk that responded to inquiries on report content and methodology, feedback solicited from providers, and an experience report that summarized the content of the reports to CMS.

To view a medical group report template, click here.


"What Physicians Think About Resource Use Reports." AcademyHealth Annual Research Meeting (June 2009)

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