Can Good Senior Care Coordination Happen Under Current Medicare Payment Model?

The way care is delivered and paid for under the Medicare system is in desperate need of restructuring in order to achieve good care coordination, but that might only happen if life under the current fee-for-service model gets “more difficult” for healthcare providers, said the chairman of the Medicare Payment Advisory Commission (MedPAC) in a June 19 hearing before the House Ways and Means Health Subcommittee.

In order for care coordination to improve (the main topic of MedPAC’s June 2012 report to Congress), the current payment model has to change, said MedPAC chairman Glenn Hackbarth. Medicare should move away from the fee-for-service (FFS) system, but there’s not much of an incentive to do so. 

In a somewhat heated exchange between Representative Bill Pascrell (D.-N.J.) and Hackbarth, the Congressman asked the MedPAC chairman to clarify a statement that “life under fee-for-service has to get more difficult.” 


“Our goal is not to make life more difficult for doctors,” Hackbarth said. “But we want to create new opportunities.”

But those opportunities probably won’t be developed until there’s pressure on the FFS system to encourage people to move into new payment models, he said. 

Demonstration projects run by the Centers for Medicare & Medicaid Services (CMS) on care coordination show that for a program to be successful, it has to be “carefully woven into the environment where it occurs.”


After studying some care coordination demonstrations, MedPAC found that what works in that model is highly dependent on the context. 

“To be effective, [care coordination] needs to be more organic,” Hackbarth said. “It can’t readily be imposed from the outside, with a ‘plug in’ mantra.” 

There’s a policy conclusion from that, he continued: “If we want good care coordination, the best approach is to create both clinical and financial accountability for a group of providers, have clear measurements of success, and give them some room to adapt care coordination approaches to their particular circumstance.” 

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Ultimately, MedPAC doesn’t think the FFS model should be completely done away with, Hackbarth clarified. Rather, Medicare beneficiaries should have options; there could be plans under Medicare Advantage that offer “old-style fee-for-service.” 

View MedPAC’s June 2012 report to Congress.

Written by Alyssa Gerace

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