Healthcare Alert: MACRA-me?

Readers of a certain age remember macramé, a craft made by tying cordage into knots to create a useful or decorative shape. Macramé could be fun and therapeutic.

The “MACRA-me” discussed here is anything but fun and therapeutic but learning to “tie the knots of MACRA” will help “to modernize and streamline Medicare and tie payments to quality patient care for hundreds of thousands of physicians and other clinicians.”

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law April 16, 2015. MACRA is set to begin on January 1, 2017. Three important policies will be changed by MACRA:

  • MACRA repeals the Sustainable Growth Rate (SGR) formula and stabilizes Medicare payments.
  • MACRA replaces three Medicare reporting programs, Meaningful Use (MU), Physician Quality Reporting System (PQRS) and Value-Based Modifier (VBM), with a single Quality Payment Program (QPP).
  • MACRA provides opportunities for physicians and other clinicians to earn more by focusing on quality patient care.

The “me” of this discussion affects any eligible clinician. Eligible clinicians include physicians, physician assistants (PAs), nurse practitioners (NPs), clinical nurse specialists (CNSs) and certified registered nurse anesthetists (CRNAs) who bill for Medicare Part B services. Some eligible clinicians may not have to participate because of certain exemptions:

  • The first year of Medicare participation for eligible clinicians;
  • The clinician participates in an eligible Advanced Alternative Payment Model (APM); or
  • The clinician has less than or equal to $30,000 in Medicare allowed charges or less than or equal to 100 Medicare patients.

To begin tying the QPP “knots,” clinicians need to decide which of the two new payment programs works best for them, the Merit-based Incentive Payment System (MIPS) or an Advanced Alternative Payment Model (APM). It is expected that a majority of the eligible clinicians will participate in the MIPS program the first year because of complexities of the qualifications for the Advanced APMs entities (which will receive the 5% annual bonus and will be MIPS-exempt) and the Non-Advanced APM entities (which will have to participate in MIPS). The complete list of Non-Advanced APMs and Advanced APMs may be found on the CMS site These include:

  • Comprehensive ESRD Care Model (Large Dialysis Organization arrangement)
  • Medicare Shared Savings Program – Track 3
  • Comprehensive Primary Care Plus (CPC+)
  • Next Generation ACO Model
  • Medicare Shared Savings Program – Track 2

This article focuses on the MIPS program since it will be the program in which the majority of clinicians will participate in 2017. If the clinician participated in any Medicare reporting programs, PQRS, VBM and Medicare MU, there is an advantage in MIPS because many of the requirements are the same.

There are four options for MIPS participation, or as Medicare calls it, “Pick Your Pace,” in 2017:

First option: Don’t participate and receive a -4% payment adjustment to the Medicare allowable in 2019.

Second option: Submit a minimum amount of data. Medicare has said as long as the clinician submits one quality measure, one improvement activity or the five required advancing care information measures sometime during the 2017 performance year a negative payment adjustment is avoided.

Third option: Participate for 90 continuous days within calendar year 2017. The clinician can submit information on quality measures/activities for part of the 2017 calendar year and may earn a neutral or a small positive payment adjustment.

Fourth Option: Participate for the full 2017 calendar year. The clinician would submit data in three performance categories for the entire year and may qualify for a modest positive payment adjustment.

Under MIPS, clinicians will receive a composite score of 0-100 based in four performance categories. Each performance category has an assigned weight for scoring the clinician’s overall MIPS composite score. These performance categories and their weight of the total composite score are:

  • Quality (replaces PQRS)                                                                60%
  • Advancing Care Information (replaces MU)                               25%
  • Clinical Practice Improvement Activity (new category)             15%
  • Cost/Resource Use (replaces VBM)                                            0% (starts in 2018)

Each category is scored against performance standards:

  • The quality category measures are scored between 0-10 points. Points will be determined by the clinician’s percentile rank of each measure benchmark to their peer group. Full participation would be reporting up to six measures and one outcome measure (or a high priority measure, if an outcome measure is not available).
  • The advancing care information category is reported if the clinician uses certified EHR technology. The data will come from the EHR used by the clinician. The base score of 50 points is obtained by reporting on the Medicare required five measures. There are additional performance points and bonus points available to report.
  • The clinical practice improvement activity category is scored by reporting on either medium-weighted (10 points) and/or high-weighted (20 points) practice improvement activities. Eligible clinicians can attest to completing four improvement activities.
  • The cost/resource use category does not require any data submission, as it will be calculated from adjudicated claims. This category has been weighted at 0% for 2017 and will start being counted in 2018.

The negative adjustment of 4% in 2019 may seem less costly than having to work through tying the MACRA “knots,” but remember, the 4% is straight off the top. So the reduction in a private practice is a reduction directly to the physician’s compensation. Calculate a 4% reduction in the Medicare billing, and that is the reduction in a physician’s salary. In a practice with 50% Medicare and 50% in operating expenses, it is 4% out of the physician’s pocket. If there are employed physicians and/or physician extenders on a fixed salary, the reduction percentage to the physicians’ owners is even greater.

Changing behavior patterns and finding the resources to participate seem overwhelming to most clinicians and their staff, but there are financial and reputational consequences to not participating in any program. The negative payment adjustment will incrementally increase to 9% and clinicians’ performance information will be publicly reported annually on the Physician Compare website. Patients searching for quality health care services can go to the Physician Compare website to see how physicians rate compared to other physicians.

Below are some considerations for clinicians when deciding to participate in the 2017 Quality Payment Program:

  1. What is your eligibility status?
  2. What is your experience with PQRS, VBM and MU? What payment program works with your experience?
  3. Do you choose to report as an individual or group?
  4. What are the program timelines?
  5. What is the best way to submit your data?
  6. Identify and assess any feedback you may have access to.

If you need assistance working through the MACRA “knots” of the new Medicare payment system, the Elliott Davis Decosimo healthcare team is available to discuss and assist you and your practice.