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CMS Issues Final Rule on 2018 Medicare Reimbursement

CMS Issues Final Rule on 2018 Medicare Reimbursement

The Centers for Medicare & Medicaid Services has issued a final rule that includes updates to payment policies, payment rates, and quality provisions for services furnished under the Medicare Physician Fee Schedule (PFS) on or after Jan. 1, 2018.

Background on the Physician Fee Schedule

Payment is made under the PFS for services furnished by physicians and other practitioners in all sites of service. These services include but are not limited to, visits, surgical procedures, diagnostic tests, therapy services and specified preventive services.

In addition to physicians, payment is made under the PFS to a variety of practitioners and entities, including nurse practitioners, physician assistants, and physical therapists, as well as radiation therapy centers and independent diagnostic testing facilities.

Payments are based on the relative resources typically used to furnish the service. Relative Value Units (RVUs) are applied to each service for work, practice expense, and malpractice. These RVUs become payment rates through the application of a conversion factor. Payment rates are calculated to include an overall payment update specified by statute.

Patients Over Paperwork

CMS recently launched the “Patients Over Paperwork” Initiative, a cross-cutting, collaborative process that evaluates and streamlines regulations with a goal to reduce unnecessary burden, increase efficiencies, and improve the beneficiary experience. This effort emphasizes a commitment to removing regulatory obstacles that get in the way of providers spending time with patients. The Medicare Physician Fee Schedule final rule includes the following as part of this initiative:

  • reducing reporting requirements
  • removing downward payment adjustments based on performance for practices that meet minimum quality reporting requirements 

Payment Provisions 

Changes in Valuation for Specific Services

CMS reviews the resource inputs for several hundred codes under the annual process referred to as the potentially misvalued code initiative. Recommendations from the American Medical Association-Relative Value Scale Update Committee (RUC) are critically important to this work. For CY 2018, CMS is finalizing the values for individual services that generally reflect the expert recommendations from the RUC without as many refinements as CMS made in recent years.

Overall Payment Update and Misvalued Code Target

The overall update to payments under the PFS based on the finalized CY 2018 rates will be +0.41 percent. This update reflects the +0.50 percent update established under the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, reduced by 0.09 percent, due to the misvalued code target recapture amount, required under the Achieving a Better Life Experience (ABLE) Act of 2014.

After applying these adjustments, and the budget neutrality adjustment to account for changes in RVUs, all required by law, the final 2018 PFS conversion factor is $35.99, an increase to the 2017 PFS conversion factor of $35.89.

Payment Rates for Nonexcepted Off-campus Provider-Based Hospital Departments Paid Under the PFS

Section 603 of the Bipartisan Budget Act of 2015 requires that certain items and services furnished by certain off-campus hospital outpatient provider-based departments are no longer paid under the OPPS beginning Jan. 1, 2017. For CY 2017, CMS finalized the PFS as the applicable payment system for most of these items and services.

For CY 2018, CMS is finalizing a reduction to the current PFS payment rates for these items and services by 20 percent. CMS currently pays for these services under the PFS based on a percentage of the OPPS payment rate. Specifically, the final policy will change the PFS payment rates for these services from 50 percent of the OPPS payment rate to 40 percent of the OPPS rate. CMS believes this adjustment will provide a more level playing field for competition between hospitals and physician practices by promoting greater payment alignment.

Medicare Telehealth Services

For CY 2018, CMS is finalizing the addition of several codes to the list of telehealth services, including:

  • HCPCS code G0296 (visit to determine low dose computed tomography (LDCT) eligibility);
  • CPT code 90785 (Interactive Complexity);
  • CPT codes 96160 and 96161 (Health Risk Assessment);
  • HCPCS code G0506 (Care Planning for Chronic Care Management); and
  • CPT codes 90839 and 90840 (Psychotherapy for Crisis).

CMS is finalizing its proposal to eliminate the required reporting of the telehealth modifier GT for professional claims in an effort to reduce administrative burden for practitioners and finalizing separate payment for CPT code 99091, which describes certain remote patient monitoring, for CY 2018.

In the proposed rule, CMS sought comment on whether to make separate payment for CPT codes that describe remote patient monitoring or other existing codes that describe extensive use of communications technology. Some commenters raised concerns with our proposal, citing concerns that existing CPT codes were overly broad and not always reflective of current technology. Other commenters were supportive of the proposal generally but noted that CPT is currently working on codes that more accurately describe remote patient monitoring. In the final rule, CMS is finalizing separate payment for CPT code 99091 (Collection and interpretation of physiologic data (e.g., ECG, blood pressure, glucose monitoring) digitally stored and/or transmitted by the patient and/or caregiver to the physician or other qualified health care professional, qualified by education, training, licensure/regulation (when applicable) requiring a minimum of 30 minutes of time, for 2018 pending anticipated changes in CPT coding.

Malpractice Relative Value Units (RVUs)

For CY 2017, CMS collected updated professional liability insurance data for the purposes of updating the malpractice geographic practice cost indices but did not propose to use the data to update the specialty risk factors used in the calculation of malpractice RVUs at that time. Rather, CMS solicited comment on whether it should consider updating the malpractice RVUs based on the updated professional liability insurance data prior to the next expected 5-year update (CY 2020).

After consideration of public comments received, for CY 2018, CMS is not finalizing its proposal to develop malpractice RVUs using the most recent data available. Implementation not finalizing the proposal to use premium data collected for the would occur by CY 2017 malpractice geographic practice cost indices to update the specialty risk factors for CY 2018-2020. Additionally, CMS is not finalizing the proposal to align the update of malpractice premium data with the malpractice geographic practice cost index updates, which has been done once every three years, at this time.

Care Management Services

CMS is continuing efforts to improve payment within traditional fee-for-service Medicare for chronic care management and similar care management services to accommodate the changing needs of the Medicare patient population. CMS is finalizing its proposals to adopt CPT codes for CY 2018 for reporting several care management services currently reported using Medicare G-codes and clarifying a few policies regarding chronic care management in this final rule.

Improvement of Payment Rates for Office-based Behavioral Health Services

CMS is finalizing an improvement in the way physician fee schedule rates are set that will positively impact office-based behavioral health services with a patient. The final policy will increase payment for these important services by better recognizing overhead expenses for office-based face-to-face services with a patient.

Evaluation and Management Comment Solicitation

Most physicians and other practitioners bill patient visits to the PFS under a relatively generic set of codes that distinguish level of complexity, site of care, and in some cases whether or not the patient is new or established, or Evaluation and Management (E/M) visit codes. Billing practitioners must maintain information in the medical record that documents they have reported the appropriate level of E/M visit code. CMS maintains guidelines that specify the kind of information that is required to support Medicare payment for each level.

CMS agreed with continued feedback from stakeholders that these guidelines are potentially outdated and need to be revised.

CMS thanks the public for the comments received in response to the proposed rule’s comment solicitation on the E/M guidelines and summarizes these comments in the final rule. Commenters suggested additional avenues for collaboration with stakeholders prior to implementing any changes, and CMS will consider the best approaches for such collaboration and will take the public comments into account for future rulemaking.

Emergency Department Visits Comment Solicitation

CMS sought comment from stakeholders on whether emergency department visits are undervalued due to increasing heterogeneity of the settings under which emergency department visits are furnished and changes to the patient population. A number of comments were received suggesting these services are potentially misvalued and will be reviewing emergency department visits (CPT codes 99281-99385) as potentially misvalued for future rulemaking.

Solicitation of Public Comments on Initial Data Collection and Reporting Periods for Clinical Laboratory Fee Schedule

The Clinical Laboratory Fee Schedule (CLFS) final rule entitled “Medicare Program: Medicare Clinical Diagnostic Laboratory Tests Payment System” implements Section 1834A of the Social Security Act (the Act), which requires extensive revisions to the Medicare payment, coding, and coverage for Clinical Diagnostic Laboratory Tests (CDLTs) paid under the CLFS. Under the final rule, the payment amount for a test on the CLFS furnished on or after Jan. 1, 2018, generally will be equal to the weighted median of private payer rates determined for the test, based on the data of applicable laboratories that is collected during a specified data collection period and reported to CMS during a specified data reporting period. The first data collection period was from Jan. 1 through June 30, 2016, and the first data reporting period was from Jan. 1, 2017, through March 31, 2017.

Laboratory industry feedback suggested that many reporting entities would not be able to submit a complete set of applicable information to CMS by the March 31, 2017, deadline. As a result, on March 30, 2017, CMS announced a 60-day period of enforcement discretion until May 30, 2017, with respect to the data reporting period for reporting applicable information under the Medicare CLFS and the application of the Secretary’s potential assessment of civil monetary penalties (CMPs) for failure to report applicable information.

In the proposed rule, CMS solicited public comments from applicable laboratories and reporting entities to better understand applicable laboratories’ experiences with the data reporting, data collection, and other compliance requirements for the first data collection and reporting periods under the new private payor rate-based CLFS.

Part B Drugs: Payment for Biosimilar Biological Products

In the CY 2016 PFS final rule with comment period, CMS finalized a proposal to make clear that biosimilar products that rely on a common reference product’s biologics license application are grouped into the same payment calculation for determining a single average sales price payment limit, and that a single Healthcare Common Procedure Coding System (HCPCS) code is used for such biosimilar products.

In the CY 2018 PFS proposed rule, CMS asked for comments on the effects of its payment policy based on experience with the United States’ biosimilar product marketplace.

CMS received numerous comments on this issue. In response to concerns raised in the comments, CMS is changing the policy to separately code and pay for biological biosimilar products under Medicare Part B. Effective Jan. 1, 2018, newly approved biosimilar biological products with a common reference product will no longer be grouped into the same billing code.

CMS believes a solution that increases provider and patient choice is superior to existing policy and may lead to additional cost savings over the long-term. By encouraging innovation and greater manufacturer participation in the marketplace, this policy change will result in the licensing of more biosimilar products, creating a stable and robust market, driving competition and decreasing uncertainty about access and payment. Carrying out this policy change as early as possible, rather than waiting, is expected to bring more certainty to the new and developing marketplace.

Part B Drug Payment: Infusion Drugs Furnished through an Item of Durable Medical Equipment (DME)

The 21st Century Cures Act transitioned payment for infusion drugs or biologicals furnished through a covered item of DME from average wholesale price (AWP) to average sales price (ASP) pricing methodology on Jan. 1, 2017. CMS is finalizing the proposed revision to 42 CFR §414.904(e)(2) to conform regulations with the statutory payment requirements in section 5004(a) of the 21st Century Cures Act.

New Care Coordination Services and Payment for Rural Health Clinics (RHCs) and Federally-Qualified Health Centers (FQHCs)

CMS is finalizing the proposal to revise payment for chronic care management in RHCs and FQHCs, and establish requirements and payment for RHCs and FQHCs furnishing general behavioral health integration (BHI) services and psychiatric collaborative care model (CoCM) services. Effective Jan. 1, 2018, RHCs and FQHCs will be paid for CCM, general BHI, and psychiatric CoCM using two new billing codes created exclusively for RHC and FQHC payment. This payment would be in addition to the payment for an RHC or FQHC visit.

Appropriate Use Criteria for Advanced Diagnostic Imaging

CMS is finalizing a start date for the Medicare Appropriate Use Criteria (AUC) Program for Advanced Diagnostic Imaging. The program will begin in a manner that allows practitioners more time to focus on and adjust to the Quality Payment Program before being required to participate in the AUC program. The Medicare AUC program will begin with an educational and operations testing year in 2020, which means physicians would be required to start using AUCs and reporting this information on their claims. During this first year, CMS is proposing to pay claims for advanced diagnostic imaging services regardless of whether they correctly contain information on the required AUC consultation. This allows both clinicians and the agency to prepare for this new program.

CMS posted newly qualified provider-led entities and clinical decision support mechanisms in July of this year. Qualified provider-led entities are permitted to develop AUC, and qualified clinical decision support mechanisms are the tools that physicians use to access the AUC. Physicians may begin exploring these mechanisms well in advance of the start of the Medicare AUC program through the voluntary participation period that will begin mid-2018 and run through 2019. During this time CMS will collect limited information on Medicare claims to identify advanced imaging services for which consultation with appropriate use criteria took place.

In addition, by having qualified clinical decision support mechanisms available (some of which are free of charge) clinicians may use one of these mechanisms to earn credit under the Merit-Based Incentive Payment System as an improvement activity. This improvement activity was included in the 2018 Quality Payment Program final rule.

Medicare Diabetes Prevention Program Expanded Model

The final rule also implements the Medicare Diabetes Prevention Program (MDPP) expanded model starting in 2018. The MDPP expanded model was announced in early 2016, when it was determined that the Diabetes Prevention Program (DPP) model test through the Center for Medicare and Medicaid Innovation’s Health Care Innovation Awards met the statutory criteria for expansion. The final rule includes additional policies necessary for suppliers to begin furnishing MDPP services nationally in 2018, including the MDPP payment structure, as well as additional supplier enrollment requirements and supplier compliance standards aimed to enhance program integrity.

Physician Quality Reporting System (PQRS)

Under the PQRS, individual eligible professionals and group practices who did not satisfactorily report data on quality measures for the CY 2016 reporting period are subject to a downward payment adjustment of 2.0 percent in 2018 to their PFS covered professional services. 2016 was the last reporting period for PQRS. The final data submission timeframe for reporting 2016 PQRS quality data to avoid the 2018 PQRS downward payment adjustment was January through March 2017. PQRS is being replaced by the Merit-based Incentive Payment System (MIPS) under the Quality Payment Program (QPP). The first MIPS performance period is January through December 2017.

CMS proposed and is finalizing a change to the current PQRS program policy that requires reporting of nine measures across three National Quality Strategy domains to only require reporting of six measures for the PQRS with no domain requirement. We are also finalizing similar changes to the clinical quality measure reporting requirements under the Medicare Electronic Health Record Incentive Program for eligible professionals who reported electronically through the PQRS portal.

We finalized these changes based on stakeholder feedback and to better align with the MIPS data submission requirements for the quality performance category. For MIPS, eligible clinicians need only report six quality measures for the quality performance category, except those reporting via the Web Interface, and there is no requirement to ensure that the measures span across three National Quality Strategy domains.

Patient Relationship Codes

In May 2017, CMS posted the operational list of patient relationship categories that are required under section 101(f) of MACRA. In this rule, we finalized certain Level II HCPCS modifiers to be used on claims to indicate these patient relationship categories. Further, we finalized a policy that the reporting of these HCPCS modifiers may be voluntarily by clinicians associated with these patient relationship categories beginning Jan. 1, 2018. We anticipate that there will be a learning curve with respect to the use of these modifiers, and we will work with clinicians to ensure their proper use.

Medicare Shared Savings Program

CMS is finalizing several modifications to the rules for accountable care organizations (ACOs) participating in the Medicare Shared Savings Program. These modifications are designed to reduce burden and streamline program operations. The new policies include the following:

  • Revisions to the assignment methodology for ACOs that include FQHCs and RHCs by eliminating the requirement to enumerate each physician working in the FQHC or RHC on the ACO participant list;
  • Reduction of burden for ACOs submitting an initial Shared Savings Program application or the application for use of the skilled nursing facility (SNF) Three-Day Rule Waiver; and
  • The addition of three new chronic care management codes (CCM) and four behavioral health integration (BHI) codes to the definition of primary care services used in the ACO assignment methodology.

2018 Value Modifier

In order to better align incentives and provide a smoother transition to the new Merit-based Incentive Payment System under the Quality Payment Program, we are finalizing the following changes to previously-finalized policies for the 2018 Value Modifier:

  • Reducing the automatic downward payment adjustment for not meeting the criteria to avoid the PQRS adjustment from negative four percent to negative two percent (-2.0 percent) for groups of ten or more clinicians; and from negative two percent to negative one percent (-1.0 percent) for physician and non-physician solo practitioners and groups of two to nine clinicians;
  • Holding harmless all physician groups and solo practitioners who met the criteria to avoid the PQRS adjustment from downward payment adjustments for performance under quality-tiering for the last year of the program; and
  • Aligning the maximum upward adjustment amount to 2 times the adjustment factor for all physician groups and solo practitioners.
  • Given final policy changes for the Physician Quality Reporting System and the Value Modifier, we finalized that we will not report 2018 Value Modifier data in the Physician Compare downloadable database as this would be the first and only year such data would have been reported. However, to promote transparency we will continue to make available the Value Modifier public use and research identifiable files.

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CMS Issues More Protections to Physicians from Health Plan Credit Card Fees

CMS Issues More Protections to Physicians from Health Plan Credit Card Fees

In 2016 the Medical Association passed legislation to prevent physicians from unknowingly accepting virtual credit cards (VCC) and their hidden fees as a form of payment from health insurance companies and RCOs, even though the Medicaid RCO system in Alabama now appears to be defunct. Now, the Centers for Medicare and Medicaid Services (CMS) has given notice that health plans cannot require physician practices or other health care organizations to accept payments made using so-called VCCs that are often accompanied by exorbitant service fees.

Once the Automated Clearing House (ACH) EFT standard went into effect in 2014, the Medical Association joined with other medical groups to advocate that CMS issue guidance spelling out physician rights regarding insurance company electronic payments, even passing legislation in Alabama. CMS has now posted the requested clarification of its EFT operating rules and standards on its HIPAA Administrative Simplification frequently asked questions webpage.

Unfortunately, not all private insurers followed the letter or spirit of the regulations and some insisted on making payments with VCCs, a 16-digit number emailed, faxed or mailed to a provider in order to make a one-time payment. In Alabama, all health insurers and RCOs must make physicians aware of their contracts of a physicians’ right to request payment via flat-fee “direct deposit” methods over VCCs, which charge a percentage-of-claims-based fee. The new law requires that all such physician requests for payment preference be honored.

Physicians accepting VCCs are losing a percentage of their contracted rate for any claims paid via this method. The fees may be as high as 5 percent of the total payment amount and health insurers paying claims with VCCs often receive cash back (up to 1.75 percent) or other incentives. The bank or credit card company issuing the VCC is also paid for use of their card network. In other words, unknown to many physicians and their staff responsible for claims and billing, insurers and credit card companies are indirectly charging up to 5 percent of a claim for processing the transfer of money via VCC. In some practices, these fees may add up to substantial sums – and the charges are hidden.

According to CMS: “A health plan cannot require a provider to accept virtual credit card payments. A provider has the right to request that a health plan use the electronic funds transfer (EFT) transaction. If a provider makes the request, the health plan must comply.”

Health insurance companies and RCOs place language into all their contracts with physicians outlining that a physician’s request to be paid with an ACH EFT (electronic funds transfer) must be honored.  Under HIPAA, payments made via the Automated Clearing House may only be a nominal flat fee – for instance, $0.34 instead of the 5 percent attached to some VCCs. The required language for all contracts, which must be in all caps, bolded 12-point font and offset from other language, reads as follows: “If a covered health care provider requests payment under a health insurance plan from a health insurer or its contracted vendor or a regional care organization be made using ACH electronic funds transfer, that request must be honored. Furthermore, such a request may not be used to delay or reject a transaction, or attempt to adversely affect the covered health provider.”

Although the Medical Association was successful in getting the law changed in Alabama to ensure physicians are notified in their contracts of their right to be paid with ACH EFT payments over VCCs, physicians and practices must individually decide whether or not they want to consent to the percentage-based fees associated with acceptance of VCCs. Additionally, because the Medical Association successfully included specific language be placed in each contract that the health insurer cannot delay or deny a transaction because of the choice of electronic funds transfer, each physician and practice should look for hidden “value-added” services. For instance, some ACH vendors have attempted to charge a higher fee for providing access to a 24-hour hotline. Under existing law, physicians are not required to enroll in such “value-added” programs.

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Judge Rejects Bid to Revive ACA Subsidies

Judge Rejects Bid to Revive ACA Subsidies

A federal judge has denied several states’ attempt to compel the Trump administration to continue paying cost-sharing reduction payments. Attorney generals from 18 states and the District of Columbia had filed a motion in the U.S. District Court seeking a temporary injunction that would reinstate the payments, which the administration decided to end earlier this month.

Judge Vince Chhabria was skeptical of the states’ argument during a hearing on the motion earlier this week, noting many states have already taken steps to diffuse the impact of CSR uncertainty. In his order denying the states’ request for a temporary injunction, Chhabria said although a federal judge did previously rule that CSR payments should end because they were not properly appropriated by Congress, in this instance, the Trump administration has the stronger legal argument. Chhabria also noted any emergency relief requested by the states would be counterproductive as state insurance regulators have been working for months to prepare for the possibility the subsidies would end.

Many states, he continued, have therefore “devised responses that give millions of lower-income people better health coverage options than they would otherwise have had.”

The Trump administration this month terminated the payments to the insurers, which help cover medical expenses for low-income Americans, as part of several moves to dismantle Obama’s signature healthcare law formally known as the Affordable Care Act. The subsidies were due to cost $7 billion this year and were estimated at $10 billion for 2018, according to congressional analysts.

Insurers have argued they do not profit from the subsidies under the Affordable Care Act, but pass them on directly to consumers to reduce deductibles, co-payments and other out-of-pocket medical expenses for low-income people. Because insurers would raise premiums on policies in the absence of the subsidies, the government would be compelled to spend more on financial assistance to low-income Americans. The Congressional Budget Office has found that a bipartisan Senate proposal to shore up Obamacare insurance marketplaces by reviving the subsidies would cut the U.S. deficit by $3.8 billion over the next decade.

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CMS Cancels Some Bundled Payment Proposals

CMS Cancels Some Bundled Payment Proposals

CMS released a proposed rule that reduced the number of mandatory geographic areas for the joint bundled payment program and cancels the cardiac bundled payment program model.

In response to the cut, the American College of Cardiology released a statement indicating the ACC “will continue to work with CMS on opportunities for clinicians to participate meaningfully in Advanced Alternative Payment Models. As we move from volume-based care to value-based care, the path forward is challenging and we must work together to find solutions.”

The cardiac bundled program was set to begin in January 2018, but the bundled payment programs have been delayed multiple times. By eliminating the bundling programs, CMS also removes one of the ways providers can qualify for MACRA’s 5 percent advanced payment model bonus.

“Changing the scope of these models allows CMS to test and evaluate improvements in care processes that will improve quality, reduce costs, and ease burdens on hospitals,” said CMS Administrator Seema Verma. “Stakeholders have asked for more input on the design of these models. These changes make this possible and give CMS maximum flexibility to test other episode-based models that will bring about innovation and provide better care for Medicare beneficiaries.”

Moving forward, CMS expects to increase opportunities for providers to participate in voluntary initiatives rather than large mandatory episode payment model efforts, including additional voluntary episode-based payment models, the agency said.

The episode payment models and the cardiac rehab incentive models were designed as mandatory payment models to test the effects of bundling cardiac and orthopedic care beginning in 2018.

Read the proposed rule here

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Free AQAF Assistance: Transition to MACRA’s Quality Payment Program

Free AQAF Assistance: Transition to MACRA’s Quality Payment Program

The Alabama Quality Assurance Foundation (AQAF), located in Birmingham, is a nonprofit consulting firm providing quality improvement assistance to the health care provider market through contract arrangements. Part of AQAF’s contract with CMS is to provide training to clinicians on the Medicare Access and CHIP Reauthorization Act (MACRA), the Merit-based Incentive Payment System (MIPS) or an Alternative Payment Model (APM). The training includes the four categories of the Quality Payment Program (QPP): quality, cost, advancing care information and clinical practice improvement activities, and the goal is to help all Alabama clinicians achieve a positive or neutral Medicare Part B Fee Schedule payment adjustment.

AQAF assists clinicians in understanding the four categories of the QPP: quality, cost, advancing care information, and clinical practice improvement activities. The goal is to help every practice choose its pace to participate so that all Alabama clinicians achieve a positive or neutral Medicare Part B Fee Schedule payment adjustment.

Technical assistance from the staff at AQAF is always FREE and available immediately by emailing, or calling toll-free Monday through Friday at 1-844-205-5540 from 8:30 a.m. to 5 p.m. CT.

For more information about QPP and to check your eligibility, visit


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Posted in: MACRA

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New Video Shows Physicians How to Avoid Medicare Payment Penalties

New Video Shows Physicians How to Avoid Medicare Payment Penalties

The Quality Payment Program (QPP) is the new physician payment system created by MACRA and is administered by the Centers for Medicare and Medicaid Services (CMS). Because the QPP is new this year, the Medical Association of the State of Alabama and the AMA want to make sure physicians know what they have to do to participate and the QPP’s “Pick-Your-Pace” options for reporting. This is especially important for those physicians who have not participated in past Medicare reporting and programs and may be less knowledgeable about the steps they can take to avoid being penalized under the QPP.

The AMA and the Federation stressed to CMS the importance of establishing a transition period to QPP and, as a result, physicians only need to report on at least one quality measure for one patient during 2017 in order to avoid a payment penalty in 2019 under the Merit-based Incentive Payment System (MIPS).

A new short video developed by the AMA, “One patient, one measure, no penalty: How to avoid a Medicare payment penalty with basic reporting,” offers step-by-step instructions on how to report so physicians can avoid a negative 4 percent payment adjustment in 2019. On this website,, there are also links to CMS’ quality measurement tools and an example of what a completed 1500 billing form looks like.


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Posted in: MACRA

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New Quality Payment Program Resources Available

New Quality Payment Program Resources Available

The Centers for Medicare & Medicaid Services has revamped the look of the Quality Payment Program website and posted new resources to help you successfully participate in your first year of the Quality Payment Program.

CMS encourages you to visit the website to review the following new resources:

For more information, visit the Quality Payment Program website. The Quality Payment Program Service Center can also be reached at 1-866-288-8292 (TTY 1-877-715- 6222), available Monday through Friday, 8 a.m.-8 p.m. (ET) or by email at

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Would You Like to Comment on Proposed Changes to the EHR Incentive Programs?

Would You Like to Comment on Proposed Changes to the EHR Incentive Programs?

The Centers for Medicare & Medicaid Services would like to hear from you on the FY 2018 Inpatient Prospective Payment System and Long Term Acute Care Hospital Proposed Rule by June 13, 2017.

Click here to read the FY 2018 Inpatient Prospective Payment System and Long Term Acute Care Hospital Proposed Rule.

Submit a Formal Comment by 5:00 p.m. ET on Tuesday, June 13

The public can submit comments in several ways:

  • By electronic submission through the “submit a formal comment” instructions on the Federal Register
  • By regular mail
  • By express or overnight mail
  • By hand or courier

The proposed rule includes potential changes to the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs, including:

  • For CY 2018, modifying the EHR reporting period from the full calendar year to a minimum of any continuous 90-day period for new and returning participants in the Medicare and Medicaid EHR Incentive programs.
  • Adding a new exception from the Medicare payment adjustments for Eligible Professionals (EPs), Eligible Hospitals and Critical Access Hospitals that demonstrate through an application process that complying with the requirement for being a meaningful EHR user is not possible if ONC’s Health IT Certification Program has decertified their certified EHR technology.
  • Implementing a policy in which no payment adjustments will be made for EPs who furnish “substantially all” of their covered professional services in an ambulatory surgical center (ASC); applicable for the 2017 and 2018 Medicare payment adjustments.
  • Using Place of Service (POS) code 24 to identify services furnished in an ASC as well as requesting public comment on whether other POS codes or mechanisms should be used to identify sites of service in addition to or in lieu of POS code 24.

To learn more, review the proposed rule and visit the CMS website.

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The Impact of MACRA

The Impact of MACRA

*Editor’s Note: Article contributed by Adele Allison, director of Provider Innovation Strategies, DST Health Solutions. Ms. Allison will be a presenter during the Medical Association’s 2017 Annual Meeting and Business Session on  April 14-15 in Montgomery.

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) accelerates the pace of change in the movement toward value-based payment (VBP).1 With an effective date of Jan. 1, 2019, MACRA requires Medicare providers to choose from two defined reimbursement paths that link quality to payment: the Merit-Based Incentive Payment System (MIPS) or advanced Alternative Payment Models (APMs).2 After considering more than 4,000 comments to the proposed rule considered, CMS released the final rule on Oct. 14,3 officially rolling out the Quality Payment Program (QPP).

CMS has outlined phases for MIPS and APMs to go into effect over a timeline through 2021 and beyond. The first CMS-proposed performance reporting period begins Jan. 1, 2017 (for payment adjustments starting in 2019). Under MACRA, Medicare revenue may be adjusted upward or downward by as much as 4 percent in 2019 (based on performance in 2017) and up to 9 percent in later years.4 To respond to the rapid program launch, CMS announced in the final rule a “Pick-Your-Pace” option for 2017, allowing a range of provider quality reporting choices to comply with MACRA.5 Nevertheless, MACRA heralds a new era in provider payment where effectiveness, efficiency and performance data will determine each clinician’s economic viability. This article will explore the essential strategies providers should consider to evolve their culture and technologies towards these new value-based payments.

Impact of MACRA: The Timing

MACRA is a Medicare cost containment law grounded in quality performance. It seeks to move health care systems and providers to advance alternative payment arrangements over time, but as quickly as the industry will allow. In the mature stages, physician practices will be expected to understand and manage the risk of care associated with attributed patient populations. While population-based payment, the most advanced phase, is the desired destination, few of today’s providers are expected to be ready to assume this level of risk. Since most providers aren’t ready to take on risk, CMS expects MIPS to be the path initially most traveled by providers – predicting 761,342 clinicians to be precise.6 Yet, even MIPS is being recognized by CMS as a lofty goal in 2017.

Milestones Toward Increasing Levels of Risk-Bearing

The path forward to align value-based payment models across private and public health plans and health systems has been laid out by the recently formed Health Care Payment Learning and Action Network (HCPLAN). The HCPLAN is a public-private collaboration of health plans, providers, patients, employers, consumers, states, federal agencies and other partners seeking to accelerate the adoption of alternative payment models that reward quality and value in health care.

Among other things, the HCPLAN has defined a framework of four categories as milestones along a payment continuum. Each category moves toward increasing levels of risk-bearing, value-based care, and payment innovation (see Figure 1).7 Physicians and other clinicians can use this framework to evaluate the status of their current payer agreements in this journey. They can also use this framework to begin developing plans to evolve further along this continuum.

Four Categories of Value-Based Payment

Category 1  Traditional fee-for-service (FFS) with no link to quality or value. Category 1 represents traditional payment models typically built on fee schedules and diagnostic related groups (DRGs).

Category 2  FFS linked to measures of quality and value. Providers are paid differentially based on measures of quality, yet providers continue to receive a fee for each service. MIPS is a Category 2 payment arrangement as is the Blue Cross and Blue Shield of Alabama Quality Management Program.8

Category 3  Alternative payment built on an FFS infrastructure. Providers begin taking limited risk with alternative payment models that span across the continuum of care. A retrospective bundled payment fits in this category, as does shared savings under an Accountable Care Organization (ACO). Category 3 arrangements that include “significant but not excessive” risk-bearing qualify as advanced APMs under MACRA. Qualified participants in CMS advanced APMs will not be subject to MIPS and will be eligible to receive a 5 percent incentive payment. Available in 14 regions, CMS has elevated the expanded medical home, a risk-sharing PCMH known as the Comprehensive Primary Care Plus (CPC+), as an example of a qualifying advanced APM under MACRA.9

Category 4  This is a population-based payment. Under Category 4, payment is not triggered by clinical service delivery, but rather the payer makes a population-based payment to the provider to assume responsibility over a defined period of time. Category 4 clinicians embrace advanced risk-bearing models often across the care continuum; shared risk for an attributed patient population that may be condition-specific or global. Like more than nominal risk arrangements under Category 3, CMS will recognize Category 4 providers as QPs under advanced APMs and not subject to MIPS.

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CMS Outline of a “Pick-Your-Pace” Plan

Since the first MIPS performance period is set for Calendar Year 2017 and the final rule governing the details of MACRA was not released until Oct. 14, 2016, providers will have very little time to plan, prepare and implement necessary changes to succeed. In response to industry concerns and comments, CMS will allow MACRA providers to “Pick Your Pace” in 2017 under the following structure in Figure 2.10

Microsoft Word - MASA article Overview of MACRA for Providers 10

Leveraging Data for Population Health Management

Through MACRA, CMS is leading change in payment reform that will permeate to other segments of health care. Providers need to think strategically about alignment with emerging quality measures and payment structures. Today is an opportune time for providers to begin collaborating more fully with each other and health plans to achieve higher levels of measurable care and payment; and, measurement is driven by data. Providers must begin thinking about assuming collective responsibility for attributed patient populations across the health delivery system as this is where payment is heading.

To do this, practitioners should leverage combined data for population health management as a provider community. The Meaningful Use programs provided physicians and other clinicians with growing visibility into their individual patient populations. Where the payer-provider relationship is one-on-one, such as under traditional fee-for-service (FFS) contracts, individual provider technical capabilities may be sufficient to meet preliminary demands for managing patient populations. Under a growing plethora of PBP models, many different types of clinicians (primary care physicians, specialists, physician assistants, nurse practitioners, nurse specialists, dentists, physical therapists, and others) may be paid as part of a collective for a shared patient. This will be driven by composite measurements that require a view of data beyond the four walls of the individual provider enterprise.

Payers have had this aggregated data view for decades through the most foundational data-source in the U.S. – claims data. Your claims process is not just a means of getting paid. Claims are a reporting vehicle where the nuances of your patient population are communicated and assessed by a payer. More and more, payers are beginning to share this aggregated population data with providers to assist with resource management, assessment of disease burden and outcomes measurement across the care continuum.

MIPS Scoring Explained

Given that nearly 90 percent of clinicians are expected to fall under a MIPS payment arrangement, it is important to understand how scoring will occur. Essentially, a single composite score for MIPS will be based on weighted performance in four categories: quality, cost, advancing care information, and clinical practice improvement activities (see Figure 3). Ultimately, MIPS rewards and penalties will be tied to a clinician’s composite performance score, and payment will wash from low-performing to high-performing providers in a budget-neutral fashion. Maximum points can be earned under the Clinical Practice Improvement Activities (CPIA) category for official medical home status under NCQA, The Joint Commission, URAC or AAAHC; or, NCQA patient-centered specialty practice (PCSP) achievement. Additionally, the formerly known CMS Electronic Health Records (EHR) Meaningful Use program is now represented under MIPS by the Advancing Care Information composite performance score category.

Microsoft Word - MASA article Overview of MACRA for Providers 10

Where can I get help and learn more?

  1. CMS Quality Payment Program interactive website. Offers a practical overview of the new program and can assist in identifying appropriate measures and activities based on your specialty. Go to:
  2. atom Alliance and the Alabama Quality Assurance Foundation (AQAF). The CMS Quality Innovation Network (QIN)-Quality Improvement Organization (QIO) for Alabama that works on data-driven initiatives. Go to:
  3. CMS Innovation Center. Provides comprehensive information about alternative payment models being implemented and tested across the country. Go to:


A fundamental change is required to move from volume to value in payment for health care services. Today, much of health care economics is still functioning under Category 1, fee-for-service, but the roadmap towards value has been laid out under MACRA. Health care providers who understand the direction CMS is driving health care economics will be better positioned to work collaboratively with their community-based peers and payers as they move along this continuum. The stage is set for a new era of value in health care.


1   Federal Register. Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive Under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models. Published May 9, 2016. Accessed August 12, 2016.

2   CMS. Quality Payment Program. Accessed August 25, 2016.

3   CMS. The CMS Blog, Plans for Quality Payment Program in 2017: Pick Your Pace. Published September 8, 2016. Accessed September 12, 2016.

4   CMS. MACRA RFI Posting. Accessed August 25, 2016.

5   CMS. The CMS Blog, Plans for Quality Payment Program in 2017: Pick Your Pace. Published September 8, 2016. Accessed September 12, 2016.

6   CMS Proposed Rule, Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models,, Table 63. Published May 9, 2016. Accessed August 25, 2016.

7   Health Care Payment Learning & Action Network. Accelerating and Aligning Population-Based Payment Models: Data Sharing. Published August 8, 2016. Accessed August 12, 2016.

8   BlueCross BlueShield of Alabama. Quality Management Program. Accessed September 13, 2016.

9   CMS Innovation Center. Comprehensive Primary Care Plus. Accessed September 13, 2016.

10   CMS. The CMS Blog, Plans for Quality Payment Program in 2017: Pick Your Pace. Published September 8, 2016. Accessed September 12, 2016.

11   CMS. MIPS Scoring Methodology Overview. Accessed August 25, 2016.

Strategies to Remember...

Essential Strategy 1:  Think of your claims as a reporting vehicle where the nuances of your patient population can be communicated to a payer.

Essential Strategy 2:  Assess your payer agreements to identify the category of payment in place today. This will help you understand where you currently are in the payment continuum.

Essential Strategy 3:  Recognize payers that make up the majority of your revenue. Contact provider relations and identify that payer’s PBP strategies and timelines. This will offer you a tactical roadmap for alignment.

Essential Strategy 4:  Identify essential data-points upon which measurement will be based. Is there overlap between payers? How do you “measure up” today? Critical data identification will help you position for workflow redesign for consistent data capture.

Posted in: MACRA

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Deadline for Seeking Review of Potential Payment Penalties

Deadline for Seeking Review of Potential Payment Penalties

Late last month, the Centers for Medicare and Medicaid Services posted information on its website that physicians can consult to determine whether they will be subject to 2017 payment penalties associated with the Physician Quality Reporting System (PQRS) and the Value Modifier. Physician practices that have concerns about the findings in their report(s) have until November 30 to file for an informal review of their data.

These penalties stem from policies in effect prior to the enactment of the Medicare Access and CHIP Reauthorization Act. Failure to successfully complete required PQRS reporting will result in a 2 percent penalty. Value Modifier penalties can range from 1 percent to 4 percent depending on the size of the practice and its performance on cost and quality measures. PQRS penalties will be communicated to physicians by mail as well as in the PQRS feedback reports posted on the CMS website. Value Modifier penalties and bonuses can be found in Quality and Resource Use Reports (QRURs) posted on the website only.

Additional information on accessing the reports and filing for an informal review can be found in the attached documents. Those who have questions, even if they are uncertain about penalty status, are urged to submit a request for informal review. Although in most cases a successful PQRS review will trigger an automatic review of related VM penalties, program officials say the safest course is to file requests for review of both PQRS and VM data.

Follow these steps to submit an informal review request:

  1. Go to the Quality Reporting Communication Support Page (CSP)
  2. In the upper left-hand corner of the page, under “Related Links,” select “Communication Support Page”
  3. Select “Informal Review Request”
  4. Select “PQRS Informal Review”
  5. A new page will open
  6. Enter Billing/Primary Taxpayer Identification Number (TIN), Individual Rendering National Provider Identifier (NPI), OR Practice Site ID # and select “submit”
  7. Complete the mandatory fields in the online form, including the appropriate justification for the request to be deemed valid. Failure to complete the form in full will result in the inability to have the informal review request analyzed. CMS or the QualityNet Help Desk may contact the requestor for additional information if necessary.

Please see “2015 PQRS: 2017 PQRS Negative Payment Adjustment — Informal Review Made Simple” available on the PQRS Analysis and Payment webpage for more information.

NOTE: The CSP will be unavailable November 18-20 for maintenance.

Additionally, 2015 PQRS feedback reports can be accessed on the CMS Enterprise Portal using an Enterprise Identity Management (EIDM) account. For details on how to obtain your report, please see the “Quick Reference Guide for Accessing 2015 PQRS Feedback Reports.” For information on understanding your report, please see the “2015 PQRS Feedback Report User Guide.” Both guides are on the PQRS Analysis and Payment webpage.

For additional questions regarding the informal review process, contact the QualityNet Help Desk at 1-866-288-8912 (TTY 1-877-715-6222) or Monday-Friday from 7:00 a.m. to 7:00 p.m. CT. To avoid security violations, do not include personal identifying information, such as Social Security Number or TIN, in e-mail inquiries to the QualityNet Help Desk.

Posted in: CMS

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