MACRA 911: Getting Started

On April 16, 2015, President Obama signed into law the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), significantly changing the health care financing system for the first time since 1965. The details of these sweeping changes are still being worked out, but all physicians should make plans for the new payment system.

MACRA repealed the Sustainable Growth Rate (SGR) payment system, which governed how physicians were paid under Part B of the Medicare program, and replaced its fee-for-service reimbursement model with a new two-track system requiring physicians to accept a certain amount of risk: Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APMs).

While MACRA only impacts Medicare payments, commercial payers typically follow Medicare’s payment models, and it is likely that risk will be more prominent in the commercial setting over the next several years. This is just the beginning of the official rulemaking process, but it is already clear that physicians will have a choice in whether to participate in MIPS or meet requirements for an APM.

The Medical Association is studying the proposed rule and may provide comments particularly on those provisions of the rule of most significance to smaller practices. The timeline of the implementation of MACRA is of the utmost importance in that physicians will begin reporting Jan. 1, 2017, which will affect Medicare payments in 2019. The Association will provide more information as it becomes available.

Here are the steps you can take to prepare your practice for one of the two new Medicare paths:

Review your quality measurement and reporting. Understanding current quality reporting requirements and how you are scoring across both the Medicare Physician Quality Reporting System (PQRS) and private payers will help your practice be better suited for the upcoming changes.

Access and review your Medicare Quality and Resource Use Reports (QRUR) to see where you can make improvements related to cost ahead of time. Two particularly important components to identify as you prepare for meeting the care coordination requirements are: (1) your most costly patient population conditions and diagnoses, and (2) targeted care delivery plans for these conditions.

Tip: You can access your 2014 annual PQRS feedback reports and QRURs on the CMS Enterprise Portal using your Enterprise Identify Data Management account. Learn more about how to access these reports. If you are part of a large practice, you may need to talk to your administrator about accessing your QRUR.

Understand your patient data and benchmarks. Data registries can streamline reporting and improve performance scores. You can view a list of 2016 CMS-approved qualified clinical data registries and contact information on the CMS website.

Check on your electronic health record (EHR). If you use an EHR, contact your vendor to discuss how its product supports adoption of new payment models.

Make sure your EHR is certified to the Office of the National Coordinator for Health IT’s (ONC) 2014 or 2015 certification requirements. Using a 2014 or 2015 edition EHR is essential for participation in either MIPS or APMs.

Ask your vendor when it will update your software to the 2015 certified edition and whether reporting quality measures through the EHR is a viable option based on the proposed MIPS quality requirements.

Tip: You can check your product’s certification in a listing by the ONC.

For more information on how to prepare for the new Medicare payment systems, review this MACRA checklist.

MACRA 911: MIPS vs. APM

While the ink is barely dry on the 962 pages of proposed regulations issued in April by CMS, the ripples of the Medicare Access and CHIP Reauthorization Act (MACRA) is already being felt throughout the health care industry. Keeping in mind this is still a proposed rule with comments to CMS due at the end of June, the final rule could very well look much different from what has been proposed. One thing is very clear – MACRA, in whatever form it finally takes, formally replaced the Sustainable Growth Rate (SGR), which would have continued to cut physicians’ reimbursement by 21 percent each year had it not been eliminated last year.

The Medical Association is studying the proposed rule and may provide comments particularly on those provisions of the rule of most significance to smaller practices. The timeline of the implementation of MACRA is of the utmost importance in that physicians will begin reporting Jan. 1, 2017, which will affect Medicare payments in 2019. The Association will provide more information as it becomes available.

MACRA repealed the SGR payment system, which governed how physicians were paid under Part B of the Medicare program, and replaced its fee-for-service reimbursement model with a new two-track system requiring physicians to accept a certain amount of risk: Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APMs).

It’s estimated that in 2017, about 90 percent of practices will fall into the MIPS category, and it will serve as a stepping stone for some of those practices to join APMs in subsequent years. The data collected during the 2017 calendar year reporting period will be reflected in 2019 payment adjustments.

While MACRA only impacts Medicare payments, commercial payers typically follow Medicare’s payment models, and it is likely that risk will be more prominent in the commercial setting over the next several years. Initially, physicians can choose MIPS or join an APM such as an accountable care organization or patient-centered medical home. If they make no choice or are deemed to be ineligible for an APM incentive payment, they will be assigned to MIPS.

Merit-based Incentive Payment System (MIPS)

The majority of physicians today participate in one or more of three existing payment incentive and quality improvement initiatives – Physicians Quality Reporting System, Meaningful Use and the Physicians Value-Based Payment Modifier – which will be dissolved as separate programs and melded into MIPS.

Under MACRA, physicians under MIPS will have to report their performance measures to CMS to be graded on four factors:

1. Quality of Care – 30 percent
2. Use of Resources – 30 percent
3. Meaningful Use of EHRs – 25 percent
4. Clinical Practice Improvement Activities – 15 percent

High-scoring physicians will get a bonus while low-scoring physicians will see a reduction in their fees. Physicians will be allowed to choose the quality measures upon which they will be evaluated. For the calculation of payment bonuses and penalties (and for ease of eventual consumer use through public reporting on Physician Compare), the Department of Health and Human Services (HHS) will be tasked with developing a composite score for each physician based on these factors. Maximum bonuses and penalties will be 4 percent in 2019, 5 percent in 2020, 7 percent in 2021, and 9 percent in 2022 and beyond. Additional funding of up to $500 million a year will be provided for separate bonuses for “exceptional performance,” from 2019 through 2024.

Alternative Payment Models (APMs)

Physicians choosing an APM will have to join an accountable care organization or an approved patient-centered medical home, or otherwise be in an alternative payment model entity where payment is at least partly based on quality performance and on total spending. Payment tied to performance must be 25 percent of a doctor’s or group practice’s Medicare revenue in 2019, increasing to 75 percent in 2022.

Physicians who join a CMS-approved alternative payment model will get an annual 5 percent bonus in their fees from 2019 to 2024. And, starting in 2026, physicians in alternative payment models will receive an annual across-the-board fee increase of 0.75 percent. Physicians participating in MIPS will get a 0.25 percent annual increase.

CMS proposes an approach to implementing the MACRA APM pathway through which eligible clinicians can become “qualifying participants” and earn statutorily specified incentives for participation. Advanced APMs must meet three proposed requirements deriving from the MACRA statute:

1. Required use of certified EHRs;
2. Payment for covered professional services based on comparable quality measures; and,
3. Either being an enhanced medical home or bearing more than “nominal risk” for losses.

Joining an APM requires physicians to accept a certain degree of risk. Unfortunately, CMS has not yet adequately defined what degree of risk participants must accept to qualify. However, CMS proposed a “generally applicable financial risk standard” requiring APMs to include provisions that, if actual expenditures exceed expected expenditures, CMS can withhold payment, reduce payment rates, or require the APM to incur a debt to CMS. The risk must be more than nominal, which CMS accepts as “meaningful for the entity but not excessive.”

For more information about how MACRA can affect your payments, check out Health Affairs’ Health Policy Brief on Medicare’s New Physician Payment System from April 21, 2016.

MACRA 911: Will MACRA Destroy the Small Physician Practice?

The Centers for Medicare and Medicaid Services may be serving MACRA up as “part of a broader push toward value and quality,” but most small physician practices feel the federal regulation will more likely push them out of business, according to a new survey.

In a May survey by Black Book Market Research of 1,300 physician groups with five or less clinicians showed 67 percent of high Medicare-volume physicians said MACRA means “the end of their independence.” These practices believe they “will not have the technology, capital or staffing to sustain under the conditions of the Merit-based Incentive Payment System (MIPS).”

The survey also shows that a strong majority of smaller practices are struggling with reporting requirements, revenue collection, and competition from larger practices and physician networks:

• 89 percent of respondents said they “expect to minimize Medicare volumes” to avoid having to submit reports for quality improvement activities or cost performance
• 77 percent said they currently are financially struggling “due to physician staffing losses to larger group practices and hospital integrated delivery networks”
• 72 percent said they “blame their under-performing billing technology and compounding payment issues” for their financial woes

“Physician payment based on 2017 performance isn’t scheduled to kick in until 2019,” Doug Brown, managing partner of Black Book, said in a statement. “That’s far too long to maintain operations for the most stressed practices to hold on with outmoded technology and scarce billing support.”

Most small physician practices appear to agree. Nearly four-fifths of survey respondents (78 percent) said they anticipate joining a larger practice or network “to gain needed reporting, revenue cycle tools and support before 2019,” Black Book said.

However, the survey revealed that 63 percent of practices with fewer than 10 practitioners, as well as solo practice physicians, have still not settled on a technology suite or set of products that delivers to their expectations on Meaningful Use, clinician usability, interoperability and coordinated billing and claims. But over a third of those slower adopters expect to make product decisions before the end of this calendar year.

American Medical Association President Dr. Andrew Gurman is a solo-practice orthopedic hand surgeon who doesn’t use an EHR, according to MD Magazine.

“I don’t have an EHR,” Dr. Gurman told MD Magazine. “I just take the penalties.”

MACRA’s payment adjustments are scheduled to begin in January, and CMS has already made moves to help small practice physicians. HHS recently announced it will award $100 million over the next five years to organizations that provide support and training to Medicare physicians in group practices with 15 or fewer clinicians to comply with MACRA.

The Medical Association is studying the proposed rule and may provide comments particularly on those provisions of the rule of most significance to smaller practices. The timeline of the implementation of MACRA is of the utmost importance in that physicians will begin reporting Jan. 1, 2017, which will affect Medicare payments in 2019. The Association will provide more information as it becomes available.

MACRA 911: Physicians Urge MACRA Delay

The Medical Association joined the American Medical Association and numerous physician groups to urge the Centers for Medicare & Medicaid Services delay implementation of the Medicare Access & CHIP Reauthorization Act of 2015, which replaced the Medicare Sustainable Growth Rate, and ensure new federal reimbursement programs “reward physicians for the improvements they make to their practice and the quality of care they provide to their patients.”

MACRA has been sharply criticized by physicians because of its framework establishing payment incentives for physicians and other clinicians based on quality of care rather than quantity, or fee for service. This framework for determining care standards, or Quality Measure Development Plan, includes measures in six quality “domains” such as clinical care, safety, care coordination, patient and caregiver experience, population health and prevention, and affordable care. Physicians would be paid based on their quality and cost metrics.

CMS plans to base reimbursements in 2019 on physician performance beginning Jan. 1, 2017. The proposed start date is too early and will create significant problems for the launch of the MACRA programs, and physician groups are calling for a six-month delay.

Other recommendations include:

• Provide more flexibility for solo physicians and small group practices, including raising the low-volume threshold
• Provide physicians with more timely and actionable feedback in a more usable and clear format
• Align the different components of MIPS (Merit-Based Incentive Payment System) into a unified program rather than four separate parts
• Simplify reporting burdens and improve odds of success by creating more opportunities for partial credit and fewer required measures within MIPS
• Reduce reporting thresholds for quality measures

According to a new Medscape Medical News survey, almost four in 10 physicians in solo and small group practices predict an exodus from Medicare within their ranks on account of the program’s new payment plan and its punishing penalties. Fifty-nine percent of physicians in practices with fewer than 25 clinicians also said they expect to receive a performance penalty as high as 4 percent under proposed regulations that implement MACRA. Only 9 percent of physicians in under-25 groups expect a bonus, with another 12 percent counting on no change in compensation. Roughly one-third of physicians in small practices said merger into larger groups promises to be the most likely fallout from MACRA.

If you would like to take part in the poll, click here.

Could MACRA Be Delayed?

During a recent Senate Finance Committee hearing, CMS Acting Administrator Andy Slavitt hinted at the possibility the agency might delay the start date of the Medicare Access and CHIP Reauthorization Act, or MACRA. Under MACRA, CMS would begin measuring performance in 2017 for payments that begin in 2019 – a timeline that has been a huge concern for physicians that are still awaiting a final rule.

“Every physician in the country needs to feel like they are set up for success,” and to do that the agency “remain[s] open to alternative approaches,” which include later start dates, shorter reporting periods and additional methods to ease physicians into the program,” Slavitt said during the hearing.

With no official start date confirmed for MACRA, and a final rule expected to be published Nov. 1, physicians are on edge about the timing of this new program, which is set to replace the sustainable growth rate formula for physician payment adjustments under Medicare. The Medical Association joined the American Medical Association and numerous physician groups to urge CMS delay implementation of MACRA, and ensure new federal reimbursement programs “reward physicians for the improvements they make to their practice and the quality of care they provide to their patients.”

In his testimony, Slavitt conceded that small, rural and independent practices will struggle with the new rules, and a central theme emerging from the public comment period was the need to design a program with special consideration for these groups.

“They do not have the resources of larger groups and each new administrative requirement takes time away from patient care,” Slavitt said.

He said another central theme from the 4,000 formal comments CMS received asked that CMS look for flexibility to allow physicians, other clinicians and their communities time to learn about and prepare for the sweeping changes.

“While the quality payment program builds on programs that should be familiar to clinicians, we understand new rules require adjustment and preparation,” Slavitt said.

Slavitt said CMS would consider numerous approaches to help delay and soften the blow of MACRA going live, including alternative start dates and shortened reporting periods. CMS is also looking into ways to reduce reporting burdens and eliminate reporting where physicians have consistently performed well.