Medicare’s Most Maddening Policy… and Why CMS’s Attempts to Improve It May Make it Worse

By  |  July 31, 2013 |  17 

Today is my last day as chair of the ABIM, and the end of my eight-year tenure on the Board. In this blog – a bookend to the one I wrote at the start of the year, which went near-viral – I’ll describe some of our accomplishments this year and a few of the challenges that I leave my talented successors to grapple with.

ABIM Board 2013 croppedI had two very tangible tasks to accomplish during my chairmanship. First, after a decade-long tenure as CEO and President of ABIM, Chris Cassel announced her intention to step down. (Chris is now CEO of the National Quality Forum, which is increasingly crucial in a world looking for robust measures of quality, safety, and value.) After an extensive search, we selected Richard Baron to become ABIM’s new CEO, and Rich began earlier this month. Rich is one of the most impressive people I’ve met in healthcare, and a perfect choice to lead ABIM into the future. As someone who practiced general internal medicine for nearly three decades in a mid-sized Philadelphia office, he is a “doctor’s doctor.” He is intimately familiar with the work of the Board, having served on the boards of both ABIM and the ABIM Foundation for over a decade (including a year as ABIM chair). He also has extensive policy experience, most recently as director for Seamless Care Models for the Center for Medicare & Medicaid Innovation (CMMI), where he was responsible for putting meat on the bones of concepts like the “Medical Home” and “Accountable Care Organization.” Rich is wickedly smart, a superb communicator, and a great listener with impeccable values and an unerring ethical compass. He’ll be splendid.

The second area may be a bit more Inside Baseball, but will ultimately be just as important. A couple of years ago, we began a process to redesign the ABIM’s governance. Our 28-person board was both too large and had too much on its plate for effective decision making. In work that was superbly led by then-chair Catherine Lucey, assisted by a crack committee, staff and governance expert Jamie Orlikoff, we decided to transform our governance structure. As of tomorrow, the ABIM board shrinks to 15 members – chosen for their experiences and competencies rather than because they represent a given medical subspecialty – and a new group, the ABIM Council, is formed. ABIM’s work is now divided: the new board is charged with developing and carrying out our overarching strategy and holds fiduciary responsibility; the Council is responsible for the core work of the organization: the certification and MOC processes. This separation (accompanied by appropriate cross-links) is designed to give both groups the time and support they need to focus on their very large agendas. My thanks to ABIM Governance Task ForceCatherine, Jamie, the staff, and the Governance Task Force (particularly Governance Committee chair Pat Conolly and inaugural Council chair Lee Berkowitz) for breathing life into this structure, and to the entire board for a thoughtful deliberation and a very bold decision.

There were several other initiatives we started under my watch but which I’ll hand off to our able new chair, David Johnson, the Board, Council, and staff. We created a committee called Assessment 2020, led by Harlan Krumholz, whose job is to rethink how we assess physicians in the future. Here are merely some of the issues we’re grappling with:

• In a world in which virtually every doctor is documenting his or her care in an electronic medical record system, how do we take advantage of these data, as seamlessly as possible, to assess the quality of care?

• As more of our assessments are drawn from data created during care delivery, how do we ensure that we’re also measuring things that are harder to assess than care processes or even outcomes, such as diagnostic acumen and empathy?

• Since we know that the quality of care delivered by individual doctors is profoundly influenced by their practice setting, how do we measure context and take it into account in our certification process?

• In a world of ubiquitous and instantaneous access to online information, does a purely closed-book test make sense?

• How do we integrate modern simulation techniques into our assessments?

• How can we assure that individual physicians have the skills they’ll need to contribute most effectively to a rapidly changing healthcare landscape?

While our methods must remain consistent with modern thinking and technology, we can’t abandon scientifically valid tools and assessments for the latest fads. The Assessment 2020 committee is an eclectic and accomplished group that includes experts from healthcare, education, simulation, and a variety of other domains. I look forward to seeing what we come up with (I’ll continue on as a committee member).

This year we also sharpened our focus on two other challenging and hugely important issues: harmonization and transparency. We know that many physicians complain of being crushed by the burden of being measured by a variety of payers, healthcare systems, quality coalitions, as well as the Boards. We have worked hard to integrate MOC with these efforts – our goal is to allow (if the diplomate wishes) the same activities to “count” for Medicare and other insurers’ quality incentive or public reporting programs, Joint Commission practice assessments, state Maintenance of Licensure programs, Meaningful Use incentives, and more. We’ve made some headway on this, but it remains a work in progress – these are some very big cats to herd. We’ve also worked hard to keep our costs down. They are among the lowest of boards that make up the American Board of Medical Specialties (the umbrella organization for the major certifying boards). I am confident that future boards will remain committed to this path.

Moreover, we recognize that many physicians are now participating in robust QI programs within their own healthcare institutions. We have created a pathway by which such organizations can oversee their physicians’ quality work – so a group of doctors in a given hospital working on a diabetes or heart failure improvement project can all receive MOC credit, offered by their own institution, for this work. In our harmonization efforts, we have been encouraged by the response of others (particularly Medicare, under CMO Patrick Conway’s superb leadership), who appreciate that physicians themselves (this is, after all, what the Boards are – groups of physicians creating standards for their own specialties) will do a better job than payers or regulators. This too is a work in progress, but we have made real advances.

In addition, a personal passion of mine was to push the Board to become more transparent. I mean this in both senses of the word. First, how we do our business and make our decisions should be accessible to everyone who wants to know. We’ve taken strong steps in this direction, with even more to come next year.

Even more importantly, I believe that the Board should, ultimately, make more information available to patients and other interested parties than simply whether physicians are, or are not, board certified. But what type of information? Should it be levels of performance (for example, expert vs. competent), areas of specialization within a specialty (for example, an endocrinologist who has a particular expertise in thyroidology), or something else? We’ve begun a process to think through these very hard questions, with a lot of input, over the next few years. Of course, this issue is highly intertwined with our Assessment 2020 work.

Our efforts to modernize our certification programs and consider issues of transparency will be facilitated by more frequent touch points with our diplomates. All of the boards under the ABMS have been asked to transition to a more continuous process in which physicians participate in MOC more frequently than every ten years. In focus groups that we conducted in planning our MOC transformation, many physicians begged us to “just tell me what I need to do.” Our soon-to-be launched web portal will fill this need. This is an extraordinarily complex undertaking: a senior physician might be “grandfathered” in internal medicine, but have certain requirements for, say, her subspecialty of cardiology, and others for her sub-sub specialty of electrophysiology. The new web portal will represent a real advance.

It would be wildly unusual for an accreditor or standard setter to be universally loved, and ABIM is no exception. We sit at a delicate interface. Patients and patient representatives often ask us to do more: provide them more information about physicians to help them make choices and weed out “bad apples.” Yet many physicians – including a particularly vocal group of readers of this blog – clearly want us to do less. After my tenure on the Board, I remain convinced of the value of professional self-regulation and assessment, and utterly unpersuaded by the argument that MOC should just go away, that every physician can be counted on to keep up with advances in their field on their own, and that patients don’t deserve to know whether their physicians have met a set of scientifically-valid standards set by experts in their own specialty.

But can the process be improved? Sure. I’ve done my best to help ABIM, which is filled with talented and highly committed staff and board members, to do just that. As we do, it will be important to look unblinkingly at where our programs fall short, but also to base such efforts on real data, not some of the misinformation I’ve seen flying around the web. For example, between 1997 and 2012, the pass rate on the MOC exam has been 87% for first time takers, with an ultimate pass rate of 96%, not the far-lower rate being suggested in some posts (though rates on individual exam administrations do vary). Between 1990 and 2001, more than 72,000 physicians received time-limited certificates from ABIM; 92% of them enrolled in MOC at the appropriate time, and 84% completed the process successfully. Finally, we ask physicians to assess their experience with the testing component of certification and MOC. Eighty-three percent of physicians who participated in certification were satisfied with the experience, as were 78% engaged in MOC (3% and 5% were unsatisfied, respectively; the rest were neutral). Seventy-nine percent of those who participated in MOC would recommend it to a colleague.

As important as physicians’ attitudes are those of patients. In a 2003 Gallup survey, 90% of patients felt it was important or very important that physicians be reevaluated every few years; 87% thought it was important or very important that doctors periodically pass a written test. More than half stated that they would find another doctor if their own physician’s board certification lapsed. Patients want and deserve a fair and robust certification and MOC process.

I look forward to seeing what the future holds, and wish my colleagues the best of luck in pursuing this crucial agenda. I’ll continue as a Trustee of the ABIM Foundation, whose main focus over the past few years has been the highly influential Choosing Wisely® campaign.

And, of course, I’ll continue to maintain my certification, proudly.


  1. Bill Maher July 31, 2013 at 6:43 am - Reply

    Obviously, the payment system is beyond repair…

  2. Brad F
    Brad F July 31, 2013 at 9:50 am - Reply

    “Utilization Review can look to see if there was medical or social justification for admission – if not, the day or days can be denied. Isn’t that simpler?”

    Social justification?

    Good luck with CBO score. Simpler maybe, but gordian knot comes to mind when implementing a policy with a broad, very subjective definition.

    The pay for will be prohibitive in current climate. My best guess.


  3. william reichert July 31, 2013 at 12:00 pm - Reply

    It used to be that when I got a phone call about a patient it was about the patient.
    Then that changed and all the calls were about administrative compiliance. with
    CMS rules or so called ” quality ” concerns. When the Quality Assurance initiative
    came on the scene in the 80’s. I sensed an. abrupt change in my enthusiasm
    for the practice and nature of medicine. Over time this enthusiasm became a very
    private relationship between me and my patients. Eventually, without
    a culture of excellence in the culture of my medical environment…. that
    culture being extinguished by the clammoring for attention by CMS
    and its righteous vangard …. eventually my love of medicine faded into
    oblivion. I decided to retire.


  4. Jairy C. Hunter, MD MBA SFHM July 31, 2013 at 4:13 pm - Reply


    Thanks for touching this issue. The whole status mess has turned into a crisis of unintended consequences. As Medical Director of Utilization at my institution I see that we spend inordinate amounts of time (and money to third parties) assessing whether the status ordered is appropriate (or even “reasonable” by what ? standard). There’s also the age-old trick of using multiple criteria sets (InterQual, Milliman, “reasonableness”), and RAC making determinations after the fact. The sheer fact that the OIG can audit a small number of charts, extrapolate a number based on your expected error rate, then scale your penalty, makes you wonder how anyone is ever expected to get it “right.” It seems like a stacked deck.

    Hopefully, prominent voices such as yours can shed light on this fiasco.

    Don’t even get me started on the CMS inpatient-only list for surgeries.

  5. Henry Feldman July 31, 2013 at 4:58 pm - Reply

    Or let’s take IV fluids. Giving 125cc/hr is considered “high risk” so is inpatient, but 120cc/hr is not; so apparently 1/3 of a teaspoon/hr decides huge $ in the reimbursement. Even worse maybe this is a 90 year old patient with a LVEF of 25%, where 120cc/hr is very high-risk and maybe 70 is appropriate! This is similar to the definition of renal failure, doesn’t take age into the equation, where in a 90 year old the jump of 0.2 is a big change in their renal function!

    These arbitrary rules are silly, and we all waste hours on the wards dealing with it every day rather than helping our patients.

    And the good news is that the patients don’t suffer in all this. Oh wait…

  6. bev M.D. July 31, 2013 at 10:09 pm - Reply

    As a pathologist and therefore clearly unfamiliar with all of this, my outside viewpoint is that it bears all the earmarks of one of those issues that has become so complex it’s got everyone’s thinking irretrievably muddled. I suggest everyone start over. I never heard of observation status in the ’70’s as a med student. What did we do with those people then? Let’s pretend obs status doesn’t exist and then look at the problem fresh, instead of trying to tweak a clearly failed idea.

  7. AD August 2, 2013 at 1:55 pm - Reply

    The obs policy is really a disaster and efforts to correct it only make it worse. In my role as a director of UM in. 250+ bed community hospital I realized why the RAC has such rich pickings.
    The disorganization of the institution was abominable, less than10 % of the patients were discharged before noon even when there was little reason for continued stay. Delays in testing were legion and tests that could have been done in a physicians office delayed discharge till completed in the hospital.
    Explanation to the Hospitalists that such practices boosted the Part B share of costs of the patient fell on deaf ears ….”they are not my patients”
    I do not think I am describing an outlier the practitioners of such practices are legion. CMS should make reading of your blog obligatory for them
    Such practitioners tar and feather all Hospitalists even the most diligent and sincere

  8. Josh August 2, 2013 at 2:33 pm - Reply

    poor use of franz kafka’s image. how can you use the photo of 23 year old that was killed by nazis. and then criticize his writing. seems like was an amazing author in a horrible time of history.

    • Just a Patient August 4, 2013 at 10:20 pm - Reply

      Josh – while the nazis were evil incarnate, they had nothing to do with Kafka’s death. He died in 1924 from starvation/malnutrition associated with complications from tuberculosis.

  9. Observation Status | August 3, 2013 at 8:26 pm - Reply

    […] Here’s an informative blog post by Dr. Bob Wachter (a founding father of hospitalist medicine) regarding “observation” status. You’ve undoubtedly been asked many times before whether an inpatient should have “inpatient” status or “observation”. This post explains the issue well, and references a recent paper by our very own hospitalist group, who found that many observation patients don’t meet the Centers for Medicare and Medicaid Services definition. […]

  10. […] Bob Wachter, in perhaps his best post ever (of course that is just an opinion), explained the madness. Medicare’s Most Maddening Policy… and Why CMS’s Attempts to Improve It May Make it Worse […]

  11. Shirie Leng August 10, 2013 at 1:44 am - Reply

    When I was a medical intern not so long ago, in 2001, this was never an issue. You either got a “hit” (an admission) or you didn’t. Where I trained, residents did almost all the decision-making on overnight admissions, and the poor night-float senior resident triaged 30 patients and assigned them to intern/resident teams. Imagine the complications if that night float resident had to decide whether a patient was Obs or not? The poor guy is just trying to get the patients cared for!

  12. Bill Randall RN, MSN August 17, 2013 at 4:03 am - Reply

    Great topic. What you didn’t even touch on was how these “Obs patients” are held, often times, in ED beds with ED nurses having to care for these very complex, high-acuity patients (something most of us in the ED didn’t sign up for, and the very reason we don’t work the floors). These patients have multiple schedule po meds, multiple lab draws, often need help toileting, and are busy. Occupancy-wise patients can sometimes take up over 60-70% of the ED, leaving few beds for actual ED patients and the staff burnt out and dissatisfied. It’s ridiculous. Plus, it seems arbitrary which patients qualify for an actual inpatient admission and those deemed “Obs.” Finally, the actual patients must endure the noise, lack of TV’s, and other characteristics of a busy ED.

  13. Ronald HIrsch, MD November 24, 2013 at 6:19 pm - Reply

    Dr Wachter- I’ll be at UC Davis and Dameron Hospital on December 18th if you want to hear my talk on the new rule and why it actually makes perfect sense. Contact me and I can get you info.

  14. […] policy initiative in the health IT world, perhaps in all of health policy (okay, maybe second to Observation Status and the SGR). In 2009, very few people would have argued that it was a good idea to create a […]

  15. […] policy initiative in the health IT world, perhaps in all of health policy (okay, maybe second to Observation Status and the SGR). In 2009, very few people would have argued that it was a good idea to create a […]

  16. […] policy initiative in the health IT world, perhaps in all of health policy (okay, maybe second to Observation Status and the SGR). In 2009, very few people would have argued that it was a good idea to create a […]

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About the Author:

Robert M. Wachter, MD is Professor and Interim Chairman of the Department of Medicine at the University of California, San Francisco, where he holds the Lynne and Marc Benioff Endowed Chair in Hospital Medicine. He is also Chief of the Division of Hospital Medicine. He has published 250 articles and 6 books in the fields of quality, safety, and health policy. He coined the term hospitalist” in a 1996 New England Journal of Medicine article and is past-president of the Society of Hospital Medicine. He is generally considered the academic leader of the hospitalist movement, the fastest growing specialty in the history of modern medicine. He is also a national leader in the fields of patient safety and healthcare quality. He is editor of AHRQ WebM&M, a case-based patient safety journal on the Web, and AHRQ Patient Safety Network, the leading federal patient safety portal. Together, the sites receive nearly one million unique visits each year. He received one of the 2004 John M. Eisenberg Awards, the nation’s top honor in patient safety and quality. He has been selected as one of the 50 most influential physician-executives in the U.S. by Modern Healthcare magazine for the past eight years, the only academic physician to achieve this distinction; in 2015 he was #1 on the list. He is a former chair of the American Board of Internal Medicine, and has served on the healthcare advisory boards of several companies, including Google. His 2015 book, The Digital Doctor: Hope, Hype, and Harm at the Dawn of Medicine’s Computer Age, was a New York Times science bestseller.


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