TMA's MACRA Resource Center Prepares Physicians for the New Medicare Payment Paradigm

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Quality Feature — July 2016

Tex Med. 2016;112(7):47-52.

By Amy Lynn Sorrel
Associate Editor

MIPS: It's a new vocabulary word Diane Wall started seeing here and there in Texas Medical Association communications and Medicare-related articles and email lists. Soon, the quality officer for an eight-physician Austin-based specialty practice realized it was more than a blip on her radar screen. In fact, she found, the new Merit-Based Incentive Payment System (MIPS) was about to have a hefty impact on physician payment, especially for small practices. 

MIPS is one of two new quality-based payment pathways Congress designed to replace Medicare's Sustainable Growth Rate (SGR) formula under the 2015 Medicare and CHIP Reauthorization Act (MACRA). Come 2017, Medicare will begin calculating physicians' annual quality and cost performance to determine their pay two years out; next year's data will determine 2019 payment rates. 

In the last couple of years, Ms. Wall's practice had to scramble to redo workflows as Medicare kept changing requirements for the Physician Quality Reporting System (PQRS). With the shift to MACRA, Ms. Wall expects 2017 to mark an even tougher transition. 

"I feel like we're doing our due diligence, and I thought I better look into that [MIPS] to maximize whatever we can do and to lessen our penalty if nothing else. But it's true of just about every Medicare program that when you try to investigate, it's just not user-friendly," she said. "When I did talk to [Medicare], they would not give an ounce of information because [MACRA] is still in proposed rulemaking. Yet we're expected to get ready for the first of the year. It's always frustrating working with them; this is a huge change for everyone."

Enter the TMA MACRA Resource Center, poised to equip physicians for the impending earthquake in Medicare payment.

Good, Bad, or Downright Ugly?

Sooner than they think, physicians will have to prepare for what TMA leaders say is shaping up to be a potentially more complex and noxious tour de force than Medicare's hated SGR. MACRA's two-track system focuses more heavily on pay-for-value. It includes:   

  • The default fee-for-service MIPS program, where most Texas practices likely will fall, or 
  • Advanced alternative payment models (advanced APMs), which CMS defines broadly as "new approaches" to paying for medical care.  

Even though the new system does not take effect until 2019, payment will be based on how doctors perform as of 2017, so TMA leaders warn they should start preparing now. 

MACRA promised at least a marginal improvement over what physicians faced under the old SGR regime — not the least of which were threats of double-digit pay cuts every year for a decade — and under a slew of administratively confounding and overlapping penalty-based quality programs. Incentives in those programs had disappeared, giving way to penalties for noncompliance — up to 11 percent. MIPS replaces them with bonuses and penalties ranging from 4 percent in 2019 to 9 percent in 2022 and beyond. APMs, while not accessible for all practices, also offer additional bonus opportunities. 

But recent reports foreshadow a steep transition for small practices, and TMA Executive Vice President Lou Goodman, PhD, says the Centers for Medicare & Medicaid Services' (CMS') plans to implement the new law "leave me less than enthusiastic." 

So far, he says, CMS' draft regulations reveal some potentially acute circumstances ahead. "MACRA is far more complex, confusing, and controlling than the programs it is replacing," he said. “Compliance will be especially difficult for small practices, who may end up with Medicare payment penalties even if they spend the time and money to jump through all the new regulatory hoops. And the system of bonuses and penalties pits physician practices against each other so that there will be winners and losers, regardless of how well all practices 'perform' on these new quality standards." 

With federal rulemaking in full swing as of May, a TMA MACRA task force continues to pore over the 426-page draft rule, preparing to propose rewrites to its less palatable provisions. CMS plans to release the final rule in November. 

As TMA engages in in-depth discussions with CMS officials, the American Medical Association, and state and national specialty societies, Dr. Goodman says physician feedback is critical. He urges physicians from practices of all sizes to visit TMA's MACRA Resource Center to get up to speed on the new law and proposed regulations and to share input as they gear up for major change. 

Arming Physicians

TMA Council on Health Care Quality Chair Gregory M. Fuller, MD, says the MACRA center is physicians' go-to toolbox to stay informed about how payment reform will affect their practices, influence care delivery, and affect their bottom line. 

"The details of MACRA are ever-changing, and whether you are a solo physician or part of a large group, and whether you're doing MIPS or APMs, MACRA is going to apply to you in some form or fashion," he said. "This is going to be a cutting-edge resource that's going to be up to date very quickly so doctors can learn those things, especially those who don't have the resources to do this on their own because payment for Medicare is already so low. We have to arm them with the ability to succeed in these models so they can remain viable." 

One of the main goals of the MACRA Resource Center, he says, is to help physicians compare their options in the two payment tracks — each with its own requirements — and take advantage of continuing medical education opportunities, practice management services, and other tools to get started. 

A glossary deciphers the alphabet soup of MACRA terminology. The initial proposed rule already contains dozens of new terms not in the original legislation, including a new name for the meaningful use program: Advancing Care Information.

Most physicians likely will default to the MIPS track, which continues to pay fee-for-service, but consolidates the multitude of existing Medicare quality reporting programs (PQRS, meaningful use, and the value-based payment modifier) into a single program. Under MIPS' bonus-penalty structure, CMS will dock or boost physician pay using three categories similar to the old programs — quality, costs, and electronic health record (EHR) use — and a new fourth "clinical practice improvement activity" category that gives credit for practice enhancements, such as expanded access, population health management, and patient engagement. 

In the advanced APM track, practices assume some level of financial risk and reward for their patient population, in addition to following quality, cost, and EHR standards similar to MIPS. Practices that meet the advanced APM criteria are not subject to MIPS, and from 2019 to 2024 they can earn an annual lump-sum bonus of 5 percent of their total Medicare payments, with higher fee-schedule updates in 2026 and beyond.  

The proposed rule lays out a very limited initial list of qualifying advanced APMs — such as very sophisticated accountable care organizations (ACOs), shared savings programs, few if any medical homes, and specialty-specific care models — that CMS says it will update annually. APMs that CMS does not consider advanced enough for the lump-sum bonus may qualify for additional incentive payments in MIPS.

Investigate Now 

Given the newfound complexities ahead, now is the time for physicians to investigate, says oncologist and TMA quality council member Ronald S. Walters, MD. He is associate vice president of medical operations and informatics at The University of Texas MD Anderson Cancer Center in Houston. 

Although many details remain in flux with rulemaking, some big-ticket themes have stuck. 

"One of the biggest things in the proposed rule — CMS spent two pages talking about it — is Jan. 1, 2019," the start date for the new payment programs based on 2017 performance, he said. "That is not likely to change."

Nor is the push toward value-based care. He sees the agency working to reinforce U.S. Health and Human Services Secretary Sylvia Burwell's goals of linking more Medicare payments to measured quality of care.

"They say publicly they already hit their goal of 50 percent by the end of 2015, and they fully expect to be at 90 percent by 2018," Dr. Walters said. "This is a quality-based payment system, no question. So the writing on the wall is, if you don't have your processes in place already, there is more of a push now to get a handle on your quality reporting," which in the coming years will most likely be done through a registry or EHR system. 

With up to 9 percent of physician payments at risk under MIPS, "that's getting to be quite a considerable hit," Dr. Walters said. He says physicians should start assessing the impact of those penalties now, as well as opportunities for improvement. An advanced APM may look like a more attractive option to avoid the 9-percent hit, and the bigger incentive payments there strongly suggest Medicare favors participation in those models. But Dr. Walters cautions they have their own set of complex criteria. 

Choosing an APM, for instance, does not mean avoiding meaningful use, PQRS, and the value modifier because APM models still require using a certified EHR, reporting on quality indicators, and accepting financial risk for not meeting certain targets. Advanced APMs also must include at least 25 percent of a practice's Medicare payments or patients to start, but eventually can encompass private paying patients. 

On the other hand, many physicians expect MIPS will contain a more streamlined version of what they may be familiar with under Medicare's current quality reporting. That can be a transition tool to an APM later down the line, Dr. Walters says. 

That's the boat Dr. Fuller finds himself in. The Keller family physician's primary care practice plans to start out in MIPS. But because the group also participates in a commercial ACO, "we know private plans are going to follow with value-based payment and get away from fee-for-service. They are going to want to look at the same things in terms of quality outcomes rather than create a whole new data set, so we're going to be paying attention, and we need to be educated on how to do these things, and MIPS is a start." 

Ms. Wall sought TMA's help because she knew her practice would get dinged under MIPS for not having an EHR system. "We needed to investigate clinical practice improvements we could do without one. We found out from TMA that a QCDR [qualified clinical data registry] may be an option for us" to lessen the penalty, although it won't eliminate it. 

Not All Doom, But Definitely Some Gloom 

In fact, by CMS' initial estimates, most practices of 24 or fewer clinicians (including nonphysicians) could incur a MIPS penalty come 2019. Solo physicians — 87 percent — could take an especially hard hit. On the flip side, CMS estimates 80 percent of practices with 100 or more clinicians will earn bonus payments. (See "MACRA's MIPS Hits Small Practices Hard.") 

The estimate published in the proposed rule came largely from 2014 PQRS performance data. CMS has since downplayed its original estimates, saying that in 2014, “many small and solo practice physicians did not report their performance.” 

CMS' 2014 data show that, on par with national figures, 61.3 percent of Texas eligible professionals (including physicians and nonphysicians) participated in PQRS. That's up from 48.5 percent in 2013, but TMA officials say that still means too many physicians get penalized for Medicare's unnecessarily onerous and complex quality reporting programs.

CMS officials also say the agency "is committed to a continued dialogue regarding the obstacles and challenges these practices encounter, both during the rulemaking period and throughout the implementation of the Quality Payment Program." The proposed rule, they say, includes accommodations "intended to provide additional flexibility to small practices," including those in rural or designated shortage areas. They put out a white paper detailing flexibilities and support in the law for small practices, including $100 million over five years for technical assistance. The American Medical Association also received a grant to help CMS identify practices eligible for funding.

However, even large, sophisticated groups like The Austin Diagnostic Clinic, already part of a Medicare shared savings ACO, are struggling to find their place in the new MACRA world. Internist Ghassan Salman, MD, chief executive officer of the 120-physician multispecialty clinic, proposed a resolution at TMA's annual House of Delegates meeting in April to ease some of CMS' aggressive criteria for practices transitioning to APMs.   

Taking on risk to manage the overall quality and cost of care, for instance, means practices must be able to manage care and costs inside and outside their own walls, he said. 

"But I don't have information on where our patients go; I have limited ability to influence their decision where to go; and if I knew where they are going, I still have a difficult time working with patients and outside physicians to manage the cost of care. In essence, I'm still being held accountable for all those outside activities," said Dr. Salman, a TMA quality council member. 

"We as physicians owe it to our state, our patients, our country to lower the total cost of care. But before we take on this accountability, we need time to learn how to do it and do it well without hurting our physicians. We've built our processes and our IT [information technology] around fee-for-service for so many years; we need more time to transition to value-based care. And aside from it being too costly, you need the appropriate skills to manage this data, to make it actionable, and engage physicians. It's very complex, and my fear is that a lot of physicians in Texas don't have the resources or the skills to do that yet."

Amy Lynn Sorrel can be reached by phone at (800) 880-1300, ext. 1392, or (512) 370-1392; by fax at (512) 370-1629; or by email.


TMA PracticeEdge Offers ACO Services

TMA PracticeEdge, formed in 2015, offers physicians the technologies and expertise essential to providing — and proving — value-based care. It's our business to bring physicians together, giving them the scale, leverage, and resources needed to stay competitive and to transition to alternative payment models.

MACRA requires physicians to choose between the fee-for-service Merit-Based Incentive Payment System (MIPS) and eligible advanced alternative payment models (APMs). While many Medicare shared saving programs and commercial accountable care organizations (ACOs) may not yet qualify for APM bonuses, ACO activities will help physicians report on and improve MIPS scores. 

If you're thinking about starting or joining an ACO, TMA PracticeEdge's expert ACO services can help you weigh your options.

Learn more about TMA PracticeEdge ACO services on the website or by email.

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Last Updated On

December 27, 2017

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