Private equity acquisition is linked with lower MIPS scores for urologists

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“As private equity firms increasingly engage in urology, key stakeholders, including policymakers and urologists, need to ensure that the quality of care is not compromised with the structural changes implemented after acquisition," write the authors.

Urologists in practices that have been acquired by private equity firms demonstrated lower scores on Medicare’s Merit-based Incentive Payment System (MIPS) compared with those not in acquired practices, according to data published in Urology Practice.1

Kassem S. Faraj, MD

Kassem S. Faraj, MD

"At a time when a growing number of medical practices are being acquired by private equity investors, it is essential to take steps to ensure that the quality of care is maintained,” commented lead author Kassem S. Faraj, MD, in a news release on the findings.2 Faraj is a urologic oncology fellow at the University of Michigan in Ann Arbor, Michigan.

Overall, the study compared MIPS scores for 181 urologists in the years before and after their practice was acquired by a private equity firm with scores from 2368 urologists whose practices were not acquired during the study period (ranging from 2017 to 2020). The primary outcome was overall MIPS score. Secondary outcome measures included MIPS component scores (quality, improvement activities, promoting interoperability, and cost), as well as the percentage of urologists who received bonus payments.

In the year prior to acquisition, acquired urologists demonstrated similar MIPS scores to nonacquired urologists, with an overall MIPS score of 89 among acquired urologists compared with a score of 90 among nonacquired urologists (P = .5). These findings were consistent with the broken-down MIPS sections, with similar scores in quality (87 vs 88, P = .29), improvement activities (98 vs 99, P = .50), and promoting interoperability (97 vs 96, P = .33) among acquired vs nonacquired urologists, respectively. Further, the likelihood of receiving bonus payments was similar between both groups, with 92% of acquired urologists receiving a bonus payment compared with 90% of nonacquired urologists (P = .40).

In the year following acquisition, urologists in acquired practices had worse overall MIPS scores (75 vs 86, P < .001) and quality scores (73 vs 89, P < .001) compared with nonacquired urologists. Acquired urologists were also less likely to receive a bonus payment, with 35% receiving a bonus payment compared with 72% of nonacquired urologists (P < .001). There were no significant score differences in improvement activities (100 vs 99, P = .27) or promoting inoperability (81 vs 82, P = .46) between the 2 groups.

A difference-in-differences framework was then used to assess the relationship between practice acquisition and outcomes. With this analysis, acquisition was associated with a 14-point reduction in overall MIPS scores for acquired urologists (P = .04), with the difference driven by lower scores in the quality category (difference-in-differences estimate, −29 points, P < .001). Acquired urologists also demonstrated lower cost scores compared with nonacquired urologists (75 vs 78, P = .02), though the causal effects could not be analyzed due to having only 2 years of data available for the study. Further, acquisition was associated with a 34% reduction in bonus payments to urologists at acquired practices (P < .001).

The authors concluded, “As private equity firms increasingly engage in urology, key stakeholders, including policymakers and urologists, need to ensure that the quality of care is not compromised with the structural changes implemented after acquisition. Until more research is done to determine the effect of these acquisitions on patient care, it is important for practices to be transparent about their relationship with for-profit entities with patients and referring providers.”1

References

1. Faraj KS, Kaufman SR, Herrel LA, et al. Acquisition of urology practices by private equity firms and performance in the merit-based incentive payment system. Urol Pract. Published online October 19, 2023. Accessed October 23, 2023. doi:10.1097/UPJ.0000000000000441

2. Private equity acquisition affects urologists’ Medicare payment incentive scores. News release. Wolters Kluwer Health: Lippincott. October 20, 2023. Accessed October 23, 2023. https://www.newswise.com/articles/private-equity-acquisition-affects-urologists-medicare-payment-incentive-scores

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