*This is an archive page. The links are no longer being updated. 
1991.03.19 :  Medicare Cataract Surgery Demonstrations

Contact:   Bob Hardy (202) 245-6145
March 19, 1991

       Medicare has chosen three geographic areas to test whether
cataract surgery can be offered for a single fee that is lower than
the combined fees currently paid to the surgeon and the surgical
facility, HHS Secretary Louis W. Sullivan, M.D., announced today.
       The three sites chosen for the Medicare Cataract Surgery
Alternate Payment Demonstration Project are: Albany/Troy, N.Y.;
Cleveland, Ohio; and Dallas/Ft. Worth, Texas.
       The pilot project will test the "bundled" or "global" fee
arrangement already being used in the private sector.  The single,
negotiated global fee would cover all costs associated with an
episode of cataract surgery with an intraocular lens implant.
       Cataract surgery is performed on Medicare beneficiaries more
often than any other outpatient procedure, and has been targeted in
recent years by Congress as overpriced.  In 1991, HCFA will spend
over $3 billion for about one million cataract procedures.
       "We all recognize the benefits of cataract surgery for the
elderly.  HCFA's cataract surgery demonstration project will
pay negotiated fees," Dr. Sullivan said, "with the advantage of
better coordinating the care provided our Medicare beneficiaries."
     "We must offer proper incentives to providers if we are to
receive better value for our health care dollars," said Gail R.
Wilensky, Ph.D., administrator of the Health Care Financing
Administration, which runs the Medicare program.
       "One good way to achieve this is to pay a negotiated price
for a variety of services.  In this way, providers themselves can
decide where to economize while still offering competitive prices. 
This approach is far superior to constraining costs by
micro-managing health care delivery."
       Participation in the cataract demonstration by physicians
and beneficiaries is completely voluntary, and the demonstration
will not establish "exclusive" providers.
       "Designated providers will not be selected on price alone. 
A record of quality assurance and medical appropriateness will be
taken into consideration as well," Dr. Wilensky said.
       Abt Associates Inc. of Cambridge, Mass., is providing
technical support for the design and implementation of the
demonstration project.  Solicitation notices and preliminary
application packages are being sent to all Medicare cataract
surgery providers in the demonstration cities.
       Interested providers in the demonstration cities who have
not received the initial solicitation announcement and pre-
application package by April 5 can request one from Abt Associates
Inc. by calling 1-800-777-2618.

                                ###