The American Medical Group Association (AMGA) advocates full and appropriate reimbursement commensurate with Medicare+Choice Organizations’ costs of care to enhance their viability and broaden their participation in a restructured market-based Medicare. Representing large multispecialty group practices, including America’s largest and most prestigious managed care organizations, the AMGA endorses the integral – even pivotal – role of Medicare+Choice Organizations in a restructured Medicare.

Inadequate reimbursement has led to Medicare+Choice plans’ withdrawal from promising markets, reduction of benefits, and reduced enrollment. Our national health care system cannot afford to ignore the benefits to patients that result from Medicare+Choice Organizations’ continuity of care and integration of routine preventive care for the Medicare population.

The potential of Medicare+Choice Organizations’ to provide cost effective, high quality care to beneficiaries, particularly those with multiple chronic conditions, remains highly attractive and attainable. Key to attaining both viability and amplified participation is reimbursement related to the intense service needs of the Medicare population. Recent implementation of a risk adjustment model to better target reimbursement to the needs of patients is a welcome and important step. Moreover, risk-adjusted reimbursement deters adverse selection by plans. In conjunction with other incentives established through a new payment formula, risk-adjusted reimbursement has the potential to improve service availability in presently underserved regions.

Competitive Placement: The new Medicare marketplace should provide expanded participation opportunities for Medicare+Choice Organizations. To buttress amplified involvement, these plans must have sufficient support to enable them to fairly compete in a reformed, market-based Medicare program.

Reimbursement: Reimbursement levels must be annually adjusted to cover the cost increases of providing care. To encourage maintenance of continuity of care and assured access to managed care, Medicare cost contracts should be reauthorized and extended, which should also facilitate entry into new or abandoned markets. Improved care quality and outcome should be recognized by “pay for performance” reimbursement based on standardized measures for preventive, acute and chronic disease care. Such reimbursement would also incorporate rewards for adoption of clinical information systems and standards for information sharing.

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