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Focus on Healthcare: Relief for Small Practices Under Final MACRA Ruling

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In 2015 the Medicare Access and CHIP Reauthorization Act (MACRA) was passed which was a bipartisan agreement to move towards a value-based system of care. The Act would create a new approach to paying clinicians for the value and quality of care they provide. At the time of the Act’s passage nearly a year ago, it was unknown how it would be implemented or the exact details of how it would work.
November 30, 2016

In 2015 the Medicare Access and CHIP Reauthorization Act (MACRA) was passed which was a bipartisan agreement to move towards a value-based system of care. The Act would create a new approach to paying clinicians for the value and quality of care they provide. At the time of the Act’s passage nearly a year ago, it was unknown how it would be implemented or the exact details of how it would work.

In April 2016, the Department of Health and Human Services issued a Notice of Proposed Rulemaking to implement its key provisions. The proposed rule would implement the changes through a framework referred to as the “Quality Payment Program” which includes two paths, the Merit-based Incentive Payment System (MIPS) or the Advanced Alternative Payment Models (APMs).

The final MACRA ruling was announced October 14, 2016 which granted smaller practices relief on reporting requirements. Under the final ruling practices with $30,000 or less in Medicare Part B charges (up $20,000 from previous ruling), or 100 or fewer Medicare patients, will be exempt from the reporting requirements in 2017. As a result, there will be fewer doctors required to report quality data to the government next year and more flexibility under the final version for those that do not meet the exemption due to the number of paths providers may follow to avoid a payment penalty described below.

Background:

As stated above, MACRA provides medical practices with two tracks, APM or MIPS, collectively referred to as the Quality Payment Program. The MIPS model includes a fee-for-service model that rewards or penalizes a practice depending on its performance on a range of quality and outcome metrics. MIPs is often referred to as the “base” program for MACRA because if providers do not participate in it or gain an exemption from it, they receive a payment cut.

The final rule just announced establishes the manner in which eligible clinicians and groups will participate in MIPS which consolidates the components of three existing programs: the Physician Quality Reporting System (PQRS), the Value-based Payment Modifier and the Electronic Health Record (HER) Incentive Program. In addition, it adds a fourth performance measurement component of clinical practice improvement activities. Eligible clinicians may see positive, neutral or negative adjustments up to 4% to payments in 2019 based on their 2017 performance. The specified quality measures and scoring weights for 2017 are as follows:

  • Quality Activities (60%)
  • Clinical Improvement Activities (15%)
  • Advanced Care Information Performance (25%)
  • Cost/Resource Use (0%)

If providers fail to report one measure or activity, they will receive the full negative 4% adjustment.

Practices choosing the Advanced APM track will get a bonus in 2019 equal to 5% of their Medicare reimbursements and are exempt from MIPS reporting requirements. Practices will report data in 2017 and begin receiving financial bonuses or penalties based on that data in 2019. One of the key criteria by which an APM is determined to be “advanced” is the participating provider must bear more than nominal risk under the reimbursement model.

In the Final Rule, CMS set this standard for 2017 and 2018 as a: (1) potential downside of 8% of all Medicare reimbursements or (2) a 3% of the expected expenditures for which the provider is responsible under the APM itself. For a complete understanding of APMs, the Centers for Medicare and Medicaid (CMS) have provided further information on their newly launched website.

You’re practice will be a part of the Quality Payment Program in 2017 if you are in an APM or if you bill Medicare more than $30,000 a year and provide care for more than 100 Medicare patients a year. Your practice must meet thresholds for both the minimum dollars billed and the number of patients to be in the program. If below either, you are exempt from the reporting requirements in 2017.

Most small practices are expected to choose the MIPS track, and the final rule allows for more choices in how they report their data in 2017. Those who choose the MIPS track can submit:

  • A minimum amount of information such as an individual quality performance measure or clinical improvement activity
  • Data covering 90 days or more and more than one quality measure or improvement activity
  • Full year of data

Using any of the three aforementioned reporting options will enable practices to avoid a penalty in 2019 and may earn a bonus. Practices choosing not to participate will see a 4% hit to their Medicare reimbursements.

Changes from the earlier version of the MACRA rule are possible as CMS stated its intent to broaden opportunities for clinicians to participate in Advanced APMs by retrofitting existing models to qualify as “Advanced” APMs. In addition new models will be created using the CMS Innovation Center, including those recommended by the Physician-Focused Payment Model Technical Advisory Committee. One opportunity CMS is considering is testing a new ACO (Accountable Care Organization) Track 1+ model that would be a new Advanced APM in 2018 with lower risk levels than currently available to Medicare ACOs.

Medical societies generally greeted announcement of the final rule with cautious optimism. John Meigs Jr., MD, president of the American Academy of Family Physicians said in a written statement that, “the academy is pleased with the low-volume exclusions, the funds targeted to training for clinicians in small practices and the ability of practices to choose their own reporting timeline during 2017. The latter, will be of particular value to small and solo medical practices.”

 

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