August 08, 2016
How the New CMS Quality Proposal Would Affect Physician Practice
The way physicians are paid is about to change dramatically — and yet it seems doctors don’t know an overhaul is coming. Half of non-pediatric physicians have heard of the Medicare Access and CHIP Reauthorization Act of 2015 (thankfully shortened to MACRA), including…

The way physicians are paid is about to change dramatically — and yet it seems doctors don’t know an overhaul is coming. Half of non-pediatric physicians have heard of the Medicare Access and CHIP Reauthorization Act of 2015 (thankfully shortened to MACRA), including those with a high share of Medicare payments. A final rule on MACRA from the Centers for Medicare and Medicaid Services (CMS) is expected this fall, and will bring the way physicians are paid into line with other CMS initiatives. That is, quality will be the name of the game.

Physicians are busy practicing medicine, not studying the business of reimbursements — and that’s the way it should be. However, doctors should be aware of what’s in the pipeline when it will affect not just payments but the way physicians practice. Here are some key need-to-knows.

Why is MACRA happening now?

After years of potential “payment cliffs” — 17 of them, in fact — a bipartisan Congressional majority passed MACRA at the end of 2015. There are several aims:

  • Put an end to the nearly-biannual Congressional dance around physician payments
  • Create a unified program to govern physician payments in Medicare, while allowing physicians the flexibility to choose the model that suits them best
  • As with other value-based CMS initiatives, move away from paying for each service a physician provides towards a system that rewards physicians for coordinating their patient’s care and improving the quality of care delivered
  • Drive payment and service-delivery reform efforts across other payor types
  • Encourage collaboration between physicians, plans and hospitals.

However, according to the Deloitte survey, nearly 8 in 10 physicians prefer traditional fee-for-service or salary as compensation. This means many physicians will likely have to adjust their current approach and practice management based upon MACRA’s specifications.

What are the models proposed by MACRA, and how will they work?

The proposed regulation would create two new payment systems

Merit-based inventive payment system (MIPS) — Will combine parts of the Physician Quality Reporting System (PQRS), the Value Modifier (VM or Value-based Payment Modifier), and the Medicare Electronic Health Record (EHR) incentive program into one single program in which eligible physicians will be measured on quality, cost, meaningful use of EHR technology and clinical practice improvement (e.g. care coordination, outcomes for people with chronic conditions). The resulting composite score will be used to determine a positive, negative or no adjustment to a provider’s Medicare Part B payment for a medical service.

Advanced alternative payment models (APMs) — Structured much like Accountable Care Organizations (ACOs) and bundled payment initiatives, APMs are higher-risk, but also higher reward if executed well. “Examples include efforts to create a centralized “medical home” in which a team of health professionals provide coordinated care to improve patients’ health, and newer models of accountable care organizations in which doctors, hospitals and other health care providers form networks that work together to help improve the quality and reduce the spending for patient care,” writes Kaiser Health News.

Due to the difference in risk between the two models, CMS expects that most physicians will choose MIPS and, eventually, migrate towards APMs.

What happens next?

Doctors, physician assistants, nurse practitioners and other clinicians who deliver care to Medicare patients under the fee-for-service model will choose whether to participate in MIPS or APMs. “Clinicians can be exempted from MIPS if they are new to Medicare, have less than $10,000 in Medicare charges or see 100 or fewer Medicare patients or are ‘significantly participating’ in an advanced APM,” according to Kaiser Health News.

From 2016 to 2019, providers will receive a fee increase of 0.5% per year, and Medicare will begin aggregating and adjusting performance data in 2017. Payments will be adjusted accordingly beginning in 2019, but won’t increase or drop by more than 4%. The variance will increase gradually to 9% through 2022. Exceptional performance will result in bonuses beyond the higher payment levels earned. Those who participate in APMs will receive a higher upfront incentive payment of 5% from 2019 through 2024.

Will there be support for physicians?

The good news is that physicians won’t be alone — CMS will be investing up to $10 million over the next three years to fund partnership resources through the Support and Alignment Networks under the Transforming Clinical Practice Initiative (TCPI).

Through this initiative, the Support and Alignment Network awardees will identify, enroll, and provide tailored technical assistance to advanced practices in an effort to reduce Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) program expenditures by transitioning practices through the phases of transformation and enhancing the quality, efficiency, and coordination of care they deliver. CMS will award cooperative agreement funding to successful applicants that may include health care delivery systems and health care delivery plans that:

  • Presently provide quality improvement support to a large number of clinicians;
  • Are multi-regional or national in scope;
  • Are involved in generating evidence-based guidelines for clinical practice;
  • Are effectively using measurement through clinical registries and electronic health records; and
  • Are committed to expanding action to improve safety and person and family engagement.

TCPI currently consists of 39 national and regional health care networks and supporting organizations — Practice Transformation Networks and Support and Alignment Networks — that provide assistance to thousands of clinicians in all 50 states to improve care coordination and quality and to better understand their patients’ needs. These networks are a key support for clinicians preparing for the payment changes under MACRA by helping clinicians transform the way they deliver care and participate in APMs. The extra investment in TCPI is meant to help ease the transition towards delivering high-quality and efficient care, so that physicians can quickly learn from the initiative, support improvement at scale and join APMs.