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CMS Confirms MACRA is Almost Here But Signals Flexibility for Providers Who Aren

CMS Confirms MACRA is Almost Here But Signals Flexibility for Providers Who Aren't Ready

Health Care Law Note
(September 13, 2016)

Despite speculation that the Centers for Medicare and Medicaid (CMS) would delay the final rule implementing the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), Acting Administrator Andy Slavitt signaled Thursday that the Quality Payment Program adopted under MACRA will begin January 1, 2017 as planned.  However, Mr. Slavitt suggested that CMS will afford some flexibility to clinicians in the first reporting year.  The forecasted flexibility may help physicians who have not yet prepared for the change.

MACRA significantly changes the way Medicare will reimburse most physicians and other clinicians, moving the system toward value- or outcome-based reimbursement.  The Act replaced the former methodology for revising the Medicare Physician Fee Schedule with annual positive or flat fee updates under a two-track payment system that will begin in 2019.  Most physicians will be reimbursed under the Merit-Based Incentive Payment System (MIPS), while having the option to seek participation in an Alternative Payment Model (APM).

The final rule implementing MACRA is not expected until November 1, 2016.  Given the short timeframe before the initial reporting period begins on January 1, 2017, the proposed rule likely contains most of the details regarding MIPS and APM that clinicians can expect. 

Under the MIPS, payment rates will be determined, in part, on the clinician’s score across four performance categories:  quality, resource use, clinical practice improvement activity, and advancing care information (the MACRA equivalent of meaningful use of electronic health records).  The MIPS requires clinicians to submit data for scoring on the quality, clinical practice improvement activity, and advancing care information categories.  The proposed regulation details the requirements for data collection and reporting but gives providers some choice in the metrics they report.

Intended as a budget-neutral plan, the MIPS will reward high-performing clinicians with positive payment adjustments that will be offset by negative payment adjustments to lower-performing clinicians.  Comprehensive data on a provider’s patients, including data from other treating clinicians, may significantly impact a provider’s MIPS score.  Thus, it will be critical for clinicians to understand the reporting system, identify optimal metrics for their particular practices, and adopt appropriate data collection practices to maximize their MIPS scores and avoid negative payment adjustments. 

While a 2019 start date for initial payment adjustment under the MIPS may seem to give physicians plenty of time to prepare for the change, these 2019 payments will be based on clinician performance in 2017.  Accordingly, the proposed rule calls for providers to report their 2017 data by early 2018.  Despite this short timeline, a recent survey indicates that half of physicians have never even heard of MACRA.  After many commentators expressed concern regarding the January 1, 2017 start date for the first performance year, CMS has now indicated that the final rule will offer clinicians four options to “pick their pace of participation” in the first performance year.  These options are:

  1. Testing the Quality Payment Program:  Clinicians may “test” their readiness for the MIPS by submitting some data for 2017 without risking a negative payment adjustment.  This test will help providers ensure they are capturing and reporting data appropriately and are prepared to participate fully in 2018 and 2019.  This option is likely to attract providers who have not yet significantly prepared for the MIPS.

  2. Participating for Part of 2017:  A provider may choose to submit data for a reduced number of days and still qualify for a small positive payment adjustment.  Presumably, providers opting for this route would also risk a negative payment adjustment.  Therefore, this option would likely be most attractive to clinicians who have made significant headway in implementing a system for participating in the MIPS but need more time to vet their systems than the January 1, 2017 start date allows.

  3. Full Participation in 2017:  Providers can participate fully in the MIPS scoring system in 2017.  This option may appeal to those clinicians who have already invested significant resources in developing a system and who have vetted their metrics and data collection practices as it would enable the provider to qualify for the maximum positive payment adjustment.

  4. Participating in an Advanced Alternative Payment Model in 2017:  Instead of participating in the MIPS payment program, providers may choose to participate in an Advanced Alternative Payment Model such as Medicare Shared Savings Track 2 or 3 in 2017 and possibly qualify for a 5 percent incentive payment in 2019.

Details regarding these options should be set forth in the final rule expected by November 1. 

The options described by Mr. Slavitt may provide some clinicians with breathing room (especially the testing and partial participation options), but clinicians should not delay implementation of the processes they will need to maximize their reimbursement under the MIPS or APM.  Individual providers and smaller groups may find that pooling their resources can help preserve or even increase their reimbursement under MACRA.  Clinicians seeking to insulate themselves from the costs of implementing effective data collection practices and the risk of negative payment adjustments may consider joining clinically integrated networks or larger systems.  Clinicians should explore their options sooner rather than later.

Elizabeth  Sims Hedrick
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