Thanks to tools provided by the Affordable Care Act, an estimated 30 percent of Medicare payments are now tied to alternative payment models that reward the quality of care over quantity of services provided to beneficiaries, HHS announced today. Today's announcement means that over 10 million Medicare patients are getting improved quality of care by having more time with their doctors and better coordinated care - nearly a year ahead of schedule.

 

The Affordable Care Act established tools such as the Medicare Shared Savings Program and the Center for Medicare and Medicaid Innovation, which tests a number of alternative payment models for achieving better care, smarter spending and healthier people. Alternative payment models are ways for Medicare to reimburse providers based on the health of the patient and quality of care rather than the number of services provided. Examples include accountable care organizations (ACOs), advanced primary care medical homes, and new models that bundle payments for episodes of care.

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The largest distributor of endoscopes in the U.S., Olympus, has settled with the U.S. Department of Justice (DOJ) for $646 million over a series of criminal and civil charges that state it rewarded and won business by making illegal payments to doctors and hospitals. In addition, the company has an ongoing compliance burden to demonstrate that it is not continuing such activities. The DOJ sees this as a systemic problem that it must continue to address within the medical device industry.

The settlement is the largest amount ever paid by a medical device company, according to a statement from the law firm that represented the whistleblower in the case, who was Olympus' former corporate compliance officer. Ironically, he was the first to hold that position at the company and he was fired due to his objections to the company's practices. No mention was made of the company's years-long difficulties with contaminated duodenoscopes and how it might relate to these bribery and kickback charges, although the DOJ is also conducting a separate investigation into that.

WIM
This is a shocking and disturbing development in the duodenoscope scandal and further evidence that the medical device industry wields too much market power.