CMS Releases Final MACRA Rule for Physician Quality Payment Program
On October 14, 2016, the Centers for Medicare & Medicaid Services (CMS) presented its final ruling on payment structure reform pursuant to the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The ruling defines the means through which CMS will incorporate quality measurement into payment and provides incentive for participation in Alternative Payment Models (APMs). While continuing to accept comments, CMS will institute the provisions of this ruling on January 1, 2017.
Click here for the Centers for Medicare and Medicaid Services’ executive summary on this ruling.
High-Level Overview of the Ruling
MACRA envisions a patient-centered healthcare system that promotes wellness, delivers exceptional care, utilizes resources wisely, and encourages smart spending. It authorizes payment of performance incentives in one of two ways:
- Merit-based Incentive Payment System (MIPS)
- Advanced Alternative Payment Models (Advanced APMs)
MIPS sets rules for adjusting future payment streams based on quality standards, practice improvement activities, and use of technology to promote efficiency and minimize duplication of effort. CMS supports four modes of engagement during the inaugural period:
- Full reporting on all measures for a 90-day period (or the entire year) to maximize eligibility for positive payment adjustments with bonus potential for exceptional performers
- Partial reporting for a minimum of 90 days to include more than one quality measure, improvement activity, or advancing care information activity for purposes of avoiding a negative adjustment or (possibly) receive a positive adjustment
- Partial reporting for one quality measure, improvement activity, or advancing care information activity to avoid a negative payment adjustment
- No reporting with Medicare payments reduced automatically by four percent
Between 592,000 and 642,000 clinicians are expected to submit data for MIPS during 2017. Payment adjustments based on 2017 data will increase (or decrease) reimbursement rates by four percent in 2019 due to the two-year lag between when providers are evaluated and reimbursement is adjusted. By 2022, payment adjustments will vary within a range of plus or minus nine percent.
Advanced APMs provide incentives for delivery of coordinated, high-quality care across multiple clinicians within a streamlined payment system. These practices are exempt from MIPS reporting and qualify for larger rate increases and bonuses. To be eligible for consideration, all participants must: (i) use electronic health record (EHR) technology, (ii) adhere to quality standards developed under MIPS, and (iii) bear risk for monetary loss or qualify as a Medical Home Model. MIPS eligible clinicians may opt for incentive treatment under Advanced APM if they receive 25 percent of Medicare payments or see 20 percent of their Medicare patients through an Advanced APM in 2017.
CMS is sensitive to the impact of its ruling on small practices. To that end, practices that have $30,000 or less in Medicare Part B charges or 100 or fewer Medicare patients are excluded from the new requirements in 2017. Moreover, $100 million in technical assistance has been set aside to provide training and consultation to MIPS eligible clinicians in small practices, rural areas, and areas with shortfalls in health professionals.
CMS also softened technology implementation requirements to ease the burden on clinicians. Of the original 11 elements, only five remain: security risk analysis, E-prescribing, patient access to data, electronic transmission of summary of care through a health information exchange, and electronic transmission of summary of care among providers. Bonus points may be extended to those who exceed the requirements.
Next Steps for Clinicians
Since MACRA is an entirely new system, the first order of business is education. Clinicians need to identify the applicable program and get a handle on how the practice would perform if the new system were fully operational. This assessment provides a window into major gaps that need to be filled – e.g., transitioning from paper to electronic medical records – and defines operational changes to achieve high-performance scores.
For example, practices should invest the time and energy in understanding their cost structures – e.g., cost per patient visit by patient type, cost per service, etc. This data forms the baseline for evaluating practice efficiency and instituting improvements. It may also suggest opportunities for aligning with other organizations to realize economies of scale, extend mark presence, or improve negotiating positions with vendors.
For the 90+ percent of clinicians for whom MIPS applies, quality measures must be identified that are relevant to the practice and appropriate for demonstrating improvement in patient outcomes. Systems and processes must be established to capture this data and make it suitable for CMS submission. A formal quality improvement process should leverage this information to improve clinical performance.
Practices should also review the CMS clinical practice improvement activities (a new category worth 15%). These initiatives include care coordination, shared-decision making, safety checklists, population management, beneficiary engagement, and expanding practice access.
Be forewarned: MACRA was designed to be revenue-neutral. The program will produce winners and losers, making it crucial to act now. The first movers will have the advantage as they invest in their practices and develop the necessary reporting capabilities. While the rules are complex, an expert advisor can cut through the minutiae to highlight key considerations and help you create a prioritized plan of action.
This story was updated on October 18, 2016.