CMS Releases MACRA Final Rule

*Editor’s Note: The Medical Association will be studying the just-released MACRA rule and will be providing additional info as it becomes available. The Association and MGMA will co-host a free webinar, “MACRA: Essential Strategies in Economic Reform” on Nov. 7 from 12 p.m. to 1:30 p.m. Click here for more information.

On Oct. 14, the Department of Health & Human Services finalized a landmark new payment system for Medicare physicians that will continue reforming how the health care system pays for care. The rule, which since its proposal in April garnered more than 4,000 public comments, cements the two payment tracks already proposed and is scheduled to become effective Jan. 1, 2017.

First, physicians can participate in the Merit-Based Incentive Payment System track, which based payment of clinic performance, practice improvement, reporting and technology use. However, the final rule makes official the “pick-your-pace provision” allowing physicians a slower entry into the model if they are not quite prepared to handle all aspects of the program. To do that, CMS is offering physicians a flexible performance period at the beginning.

“It’s time to modernize the Medicare physician payment system to be more streamlined and effective at supporting high-quality patient care. To be successful, we must put patients and clinicians at the center of the Quality Payment Program,” said Andy Slavitt, Acting Administrator of the Centers for Medicare & Medicaid Services (CMS). “A critical feature of the program will be implementing these changes at a pace and with options that clinicians choose. Today’s policies are designed to get all eligible clinicians to participate in the program, so they are set up for successful care delivery as the program matures.”

The rule, which weighs in at nearly 2,400 pages, is informed by a months-long listening tour with nearly 100,000 attendees and nearly 4,000 public comments. A common theme in the input HHS received was the need for flexibility, simplicity, and support for small practices. First, the new payment system creates two pathways. These paths let clinicians pick the right pace for them to participate in the transition from a fee-for-service health care system to one that uses alternative payment models that reward quality of care over quantity of services.

Clinicians will choose between two options:

• The first path gives clinicians the opportunity to be paid more for better care and investments that support patients. It reduces existing requirements, while still emphasizing and rewarding quality care. In the first year, it also provides a flexible performance period, so that those who are ready can dive in immediately, but those who need more time can prepare for participation later in the year.
• The second path helps clinicians go further by participating in organizations that get paid primarily for keeping people healthy. For example, they could be part of an Accountable Care Organization where clinicians come together to coordinate high-quality care for the patients they serve. When they get better health results and reduce costs for the care of their patients, the clinicians receive a portion of the savings.

While the AMA is in the process of fully analyzing the regulations, a first review revealed that CMS responded to many of the concerns expressed by physicians about the proposed rule issued last spring. For example:

• Details are provided about the 2017 transition period announced in September. The only physicians who will experience payment penalties in 2019 are those who choose to report no performance data next year, and those who report for at least 90-days will be eligible for positive payment adjustments.
• The low-volume threshold that exempts physicians from all performance reporting has been increased from $10,000 in annual Medicare revenue and less than 100 Medicare patients to $30,000 in revenue or 100 patients. CMS estimates that this change will exempt 32.5 percent of physicians and other clinicians from the program.
• Performance reporting requirements have been further reduced, and the resource use component of the Merit-based Incentive Payment System (MIPS) has been reweighted to zero for 2017.

“We recognize, as described through many insightful comments, that many eligible clinicians face challenges in understanding the requirements and being prepared to participate in the Quality Payment Program in 2017,” Slavitt said in an executive summary of the rule. “As a result, we have decided to finalize transitional policies throughout this final rule with comment period, which will focus the program in its initial years on encouraging participation and educating clinicians, all with the primary goal of placing the patient at the center of the health care system. At the same time, we will also increase opportunities to join Advanced APMs, allowing eligible clinicians who chose to do so an opportunity to participate.”

Evolving Along with Payment Reform

CMS is building the Quality Payment Program to evolve along with the health care system. That’s why it facilitates participation in new payment models. The Affordable Care Act created the Center for Medicare and Medicaid Innovation (Innovation Center) to implement and scale the best ideas from the medical community to improve the quality of care for Medicare beneficiaries while lowering costs. Medicare has a plan for eligible beneficiaries to receive free diabetes prevention services, the quality of hip and knee replacements are being improved while lowering costs, and primary care clinicians are using flexibility to deliver the best outcomes with a payment system that rewards results. CMS intends to broaden opportunities for clinicians, including small practices and specialties, to participate in these kinds of initiatives. CMS is also reviewing reopening some existing Advanced Alternative Payment Models for application to allow more clinicians to join these types of initiatives. In 2018, CMS expects about 25 percent of eligible clinicians will be a part of the second path of Advanced Alternative Payment Models.

Providing Comprehensive Support to Physicians

To further support small practices, MACRA provides $20 million each year for five years to train and educate Medicare clinicians in small practices of 15 clinicians or fewer and those working in underserved areas. Beginning December 2016, local, experienced organizations will offer free, on-the-ground, specialized help to small practices using this funding.

Continuing to Listen

HHS is receiving feedback on the final rule with a comment period and will accept comments until 60 days after the final rule’s release date.

Quick Resource Links

• Final Rule
• Executive Summary
• Fact Sheet
• Quality Payment Program Final Rule, AMA Summary (NEW)
• Overview of Advocacy Results on Major MACRA Rule Provisions, AMA Summary (NEW)
• Quality Payment Program Website
• AMA Medicare Payment Reform Website
• Submit Comments Electronically to CMS