The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) rule has been finalized.  Since publishing the proposed rule, CMS has addressed thousands of comments, created an easy to follow ‘what is MACRA’ website and released a 24 page executive summary of the final rule.  Whether you have been keeping a close ear to the ground or are new to the rule and figuring out “what’s next,” continue reading for key changes to the proposed rule and key highlights of the final rule.

Before that, here is a quick summary of MACRA:

MACRA repeals the Medicare Sustainable Growth Rate and reauthorizes the Children’s Health Insurance Program. It improves upon the physician payment model and incorporates quality measurements and incentives to promote more efficient and cost-effective delivery of care.

You may see the term Quality Payment Program (QPP) used interchangeably in discussions of MACRA.  The Quality Payment Program encompasses all activities related to streamlining and improving the Medicare payment structure and the care delivery model.  MACRA streamlines three major programs: the Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM) and the Medicare Electronic Health Record (EHR) Incentive Program.  Components of each program were used to create the new, unified Quality Payment Program finalized under the MACRA ruling.

The Quality Payment Program consists of two programs:

• The Merit-based Incentive Payment System (MIPS)
• Advanced Alternative Payment Models (APMs)

High level changes outlined below:

Before diving into the details, here is a quick overview of the changes made to the proposed rule:

• Increased flexibility, “pick your own pace,” phased-approach and additional resources to ensure a successful start to the program.
• Additional support and education for small practices, including increasing the low-volume threshold.
• New opportunities and options under the Advanced Alternative Payment Models track, including the Medicare ACO Track 1+ option.

Key changes to proposed rule and highlights of the final rule:

2017 is a transition year with increased flexibility and a “pick your own pace” menu – CMS addressed concerns that there was no ‘ramp up’ period for providers to get acquainted with and accustomed to the new program and its intricacies. They also anticipate calendar year 2018 to be ‘transitional’ and will make modifications as needed to transitional policies through rule-making in 2017.  Ways in which CMS is making 2017 more flexible include:

• The MIPS has reduced the number of elements needed to avoid a negative adjustment and reduced the performance threshold to a threshold of 3 points(i.e. at least ONE measure needs to be submitted from the quality category or ONE measure from the improvement category or the required measures from the improvement category).
• Clinicians who achieve a final composite score (total points from each of the 3 domains) of 70 or higher will be eligible for the exceptional performance adjustment, funded from a pool of $500 million.
• Reducing the cost performance category to a weight of zero for the transition year.
• Clinicians can “pick their own pace” / choose their course of participation in one of four ways:
  • Do not participate (-4%) – Do not report and receive a -4% payment adjustment
  • Test program (No negative or positive adjustment) – Submit minimum data required (one quality measure or one improvement activity measure or required measures from advancing care information)
  • Partial program participation (Neutral or small positive adjustment) – Submit 90 continuous days of data from 2017 to earn a potential small positive adjustment
  • Full participation – Submit full year and potentially earn a positive payment adjustment. Full participation includes six (6) quality measures or 1 specialty measure set, five (5) advancing care information measures and four (4) improvement activities measures

Small practices were heard – CMS heard the concerns and revised the rule to include the following:

• Higher low-volume threshold set at less than or equal to $30,000 in Medicare Part B charges or less than or equal to 100 Medicare patients. This would exclude approximately 380,000 clinicians but only 5% of Medicare Part B Spending. It would allow small practices to prepare for future entry options into the programs.
• “Virtual group” participation for individuals and groups with no more than 10 clinicians. They will be able to join “virtual groups” and combine their MIPS reporting data. This will not be in place for 2017 as CMS believes they have addressed many concerns of small groups and individual providers. CMS, however, will begin to explore ways to structure and implement “virtual groups” and the technology needed to support them.
• Allocation of $100 million in technical support to small practices in rural areas and practices located in geographic health professional shortage areas (HPSAs), including IHS, tribal, and urban Indian clinics. CMS will utilize resources within quality improvement organizations (QIOs) and regional health collaboratives. Priority will be given to practices to groups with less than 15 clinicians, rural underserved areas, and those transitioning to an APM model.

More options within the Alternative Payment Models tracks

• Potential inclusion of Medicare ACO Track 1+ Model in 2018. This payment model incorporates more limited downside risk but enough risk to be considered an Advanced APM. It will allow more participants from the Medicare Shared Saving Programs to participate in QPP as an Advanced APM.
• To be considered an Advanced APMs or an Other Payer Advanced APM an APM must meet the following criteria:
  • Requires participants to use CEHRT
  • Provides payment for covered professional services based on quality measures comparable to those in the quality performance category under MIPS
  • Require participating entities to bear risk for monetary losses of a more than nominal amount under the APM, or be a Medical Home Model (for Other Payer APMs there is a slight difference in that entities must bear more than nominal financial risk if actual aggregate expenditures exceed expected aggregate expenditures)
• An initial set of APMs will be posted no later than January 1, 2017 and new APMs will be added as they become available or at the very least, on an annual basis. Additionally, CMS has developed a committee to evaluate stakeholder proposals of new payment models.
• Qualified Provider determinations were also set under the final rule. QPs are defined as providers who receive 25% of Medicare payments or see 20% of your Medicare patients through an Advanced APM. QPs receive a 5% incentive payment beginning in 2019 through 2024. Critical Access Hospitals (CAHs), Rural Health Clinics (RHCs), and Federally Qualified Health Centers (FQHCs) that meet certain criteria be counted towards the QP determination using the patient count method.
• Additionally, CMS is finalizing a timeline for accelerating QP determinations so providers know whether they are excluded from MIPS and entered in the Advanced APM track before the start of the next MIPS performance year.

The future of MACRA

The transitional year shows that CMS is listening and intends to make MACRA a success. It also proves, however, that MACRA will continue to evolve and providers will be responsible for keeping up with future changes.  Moreover, physicians will have to rely on interpreting their results and improving based on the payment adjustment feedback.  CMS at the moment will only provide performance feedback on an annual basis. They are exploring ways to provide more timely feedback at clinicians’ requests but until those processes and technologies are in place, clinicians will have to rely on performance period feedback via the payment adjustment scores.

We will post news updates and insights as more information becomes available from CMS.