Making MACRA Work for You

Michigan Medicine - January/February 2017

Have you heard of MACRA? And more importantly, are you prepared for it?

If the answer to either of these questions is 'no' or you're unsure, strap in. Changes are afoot in the world of Medicare reimbursement and it's critical that providers everywhere are prepared to navigate the soon-to-be changing environment. Having a firm grasp on MACRA and what it means for you and your practice will undoubtedly save you time, money and plenty of headaches, leaving you with more time to devote to caring for your patients.

What is MACRA?

It may seem like a silly place to start, but not really -- in fact, only about 50 percent of practicing physicians have even heard of MACRA according to Deloitte's 2016 Survey of U.S. Physicians. MACRA stands for Medicare Access and CHIP Reauthorization Act of 2015 and it was signed into law well over a year ago.

Don't worry, you're not already behind.

Despite being well over a year old, the Center for Medicare and Medicaid Services (CMS) just recently released the final rule explaining the forthcoming sweeping changes. At its essence, MACRA charts a roadmap for how the Medicare physician reimbursement system will move away from a volume-based, fee-for-service model and more toward a value-based care payment model stressing prevention and wellness management. MACRA sets out to reward physicians for providing quality care and achieving good outcomes in a cost-effective manner.

With CMS's Final Rule on MACRA clocking in at just under 2,400 pages, there is plenty of complexity and nuance that deserves serious consideration. Physicians everywhere will need to do their homework on this issue as they develop their own strategies for achieving success in regards to new MACRA performance requirements. But for now, let paint a broad picture of what MACRA does and how it will impact you and your practice in the very near future.

Immediate Impact

Most immediately, MACRA repealed the sustainable growth rate formula for Part B payments and replaced it with the coupling of annual of inflationary increases (0.5 percent until 2019 and 0.25 percent starting in 2026) and the new Quality Payment Program, which is the actual policy mechanism responsible for transitioning Medicare from a fee-for-service to a pay-for-performance reimbursement model.

So, what does that mean? To put it simply, a new set of metrics will play a part in determining how physicians are reimbursed for Medicare services going forward. 2017 will be the first year of reporting in this new environment, and the results of this initial performance year will be reflected in 2019 Medicare payment adjustments. Physicians and other eligible clinicians (ECs) have the choice between one of two paths dictating the specifics of how they will be reimbursed: (1) the Merit-based Incentive Payment System (MIPS) or (2) Advanced Alternative Payment Models (APMs).

Does everyone have to participate?

Actually, no. There are a few ways to be exempt from the Quality Payment Program. The most likely path to an exemption is having a low number of Medicare patients -- physicians with less than $30,000 in Medicare Part B charges or 100 or fewer Medicare patients qualify as a low-volume provider and are eligible for an exemption.

"The low-volume exemption provides a sigh of relief for a lot of physicians right off the bat," said Stacey Hettiger, Director of Medical and Regulatory Policy at the Michigan State Medical Society. "It's estimated that this change alone will exempt 32.5 percent of eligible clinicians from the QPP. Thankfully, this is one of many recommendations from MSMS and others in organized medicine that CMS recognized in the final rule."

Practitioners newly enrolled in Medicare are also exempt from MACRA through their first year.

Finally, qualified physicians participating via the AMP pathway are exempt from the MIPS requirements.

Which path to choose for eligible providers?

Assuming you don't qualify for an exemption at the onset, there won't be much of a decision to make for most. By default, physicians and other ECs will be placed on the MIPs track and most -- even if they want to -- won't be able to meet the initial requirements for the Advanced APM path. As the transition away from fee-for-service in Medicare begins, MIPS will undoubtedly be the starting place for most in 2017.

So, what exactly is MIPS?

MIPS is a modified FFS reimbursement model in which participating physicians are given a payment adjustment based on data they submit in four categories deemed emphasizing value over volume. The four categories are:

  1. Quality
  2. Resource Use/Cost
  3. Advancing Care Information (ACI)
  4. Clinical Practice Improvement Activities (CPIA).

Scores in these four categories will be weighted and rolled into one composite score ranging from 1 to 100. Physicians with a composite score above an identified threshold will receive an upward payment adjustment, and conversely, payments to physicians with scores below the threshold will be adjusted downward.

Important to note is the fact that MIPS will be a zero-sum game -- positive and negative adjustments will be distributed equally to ensure MIPS remains budget-neutral. Also, the swing of the adjustment will spread as time passes, growing from +-4 in 2017 to +-9 in 2022 and beyond.

This should sound somewhat familiar to physicians. Most of MIPS isn't new. In fact, measurement in three of the four performance categories will rely heavily on elements from three legacy quality reporting programs -- the Physician Quality Reporting System (PQRS), Value-Based Payment Modifier (VBPM) and Medicare Meaningful Use (MU).

"MIPS may sound overwhelming but the reality is most physicians are already engaged in performance, improvement and reporting activities well-aligned with the program," Hettiger said. "Evaluating those activities in which you're already engaged and then figuring out how they fit into this new model is the first and likely biggest step a lot of physicians will need to take to ensure they're on their way to meeting their MIPS participation requirements."

Additionally, getting a handle on your quality reporting is is critical.

Quality measures account for 60 percent of a physician's total MIPS score in the initial payment adjustment year of 2019 before being gradually adjusted downward to 30 percent by 2021.

If you have reported to PQRS in the past, you're already in good shape. The data collection and reporting process will be largely unchanged under MIPS. The only real difference is that physicians will now select the six quality measures that best apply to the specifics of their practice or specialty, whereas PQRS currently requires physicians to report on nine quality measures.

In this transition year, physicians already familiar with PQRS should report on metrics for which they have historically performed well and that cut across multiple payers. Doing so likely provides the best chance at a positive payment adjustment without making any significant modifications to the manner in which your practice tracks and reports data.

The Advancing Care Information (ACI) metric is the next most heavily weighted category in the first year of MIPS, constituting 25 percent of a physician's composite score. Again, the reporting in this category should be familiar to anyone previously attesting to Meaningful Use. This component of MIPS simply modifies and replaces the Medicare Electronic Health Record (EHR) Incentive Program. Emphasis has been placed on using technology in a way that promotes information exchange and interoperability between both physicians and patients.

The Clinical Practice Improvement Activities (CPIA) component of MIPS is entirely new and designed to reward physicians engaged in activities that are recognized as drivers of improvement and innovation. Despite the fact that physicians have not previously reported thes activities to CMS, most will find that they are already engaged in one or more of the specified CPIAs.

In fact, many physicians in Michigan will fully meet the CPIA requirement without having to make any changes whatsoever. Thanks to advocacy efforts led by the MSMS, Blue Cross Blue Shield of Michigan (BCBSM), and American Medical Association (AMA), CMS modified the final rule to recognize Blue Cross Blue Shield of Michigan's Patient-Centered Medical Home (PCMH) designation as fully meeting the PCMH definition under the final rule.

"CMS's decision to recognize BCBSM's PCMH designation is a huge boon for physicians here in Michigan," MSMS President David M. Krhovsky, MD, said. "The rule modification is both a testament to the quality of our state's well-established efforts to lead innovation and of our combined advocacy efforts. Additionally, it provides a hopeful indication of CMS's willingness to work with organized medicine as the Quality Payment Program is rolled out and refined."

For those who don't practice in a qualifying PCMH, there are plenty of other ways to fulfill the requirement. Of the over 90 CPIA qualifying activities, physcians need only to participate in one to gain some credit in this category. Again, participation beyond the bare minimum will be rewarded, so physicians should make an effort to identify additional improvement activities relevant to their practice. Examples of other qualifying activities include shared decision-making, extended access, care coordination between providers, participation with the Michigan Automated Presciption System (MAPS), and reporting to the Michigan Care Improvement Registry (MCIR).

The last component contributing to your MIPS score is the resource use category. This element will have an initial weight of zero percent in 2017 before being gradually adjusted upward to 30 percent of the composite MIPS score, and it will produce no additional reporting burden for physicians. This component of the MIPS score replaces the value-based modifier and is solely based on certain costs which are culled from Medicare claims.

Setting a pace

Sound complicated? That's because it is.

"MACRA is complex," said MSMS Past President Rose M. Ramirez, MD, a solo family medicine physician based in Grand Rapids and past MSMS president. "It's more than just a replacement for the SGR. It's a law that attempts to address the full diversity of the medical profession and as a result it's daunting for everyone."

And while this may seem like a lot all at once, the good news for physicians will have some additional time transitioning into MIPS.

"The overall implementation timeline is definitely ambitious, but I think the pick-your-pace flexibility CMS has provided is going to make a huge difference to a lot of providers," Hettiger said. "Having a full year to assess what infrastructure needs to be in place and what workflow processes need to be adjusted to make this viable will undoubtedly ease some anxiety for many."

While the initial 12-month performance period is set to begin on Jan. 1, 2017, physicians have until Oct. 2, 2017 before beginning their full 90-day period tracking performance measures and still potentially qualify for a small positive payment adjustment in 2019, which leaves physicians with several months to learn the ins and outs of MACRA and confidently prepare for implementation without fear of being penalized.

"The most important thing for physicians to know is they should strive to report something for 2017. At minimum, reporting on one quality measure or on one improvement activity during 2017 will be enough to keep physicians from receiving an initial downward payment adjustment in 2019," Hettiger said. "With that being said, there are definitely advantages to participating as fully as possible in 2017." Physicians that report more than the bare minimum are more likely to be rewarded, says Hettiger. Those that submit a full year of 2017 data will almost certainly qualify for a positive payment adjustment and may even receive the maximum positive adjustment available under MIPS in 2017.

"If you can do it, try to identify those components of MIPS that are aligned with your practice and quality goals and commit to submitting data reflective of your efforts," Hettiger added. "There's no downside risk to reporting for 90 continuous days or longer in 2017. At the very least, it will hopefully better prepare you to make necessary adjustments in 2018."

The APM path

With all this being said, there is an alternative to MIPS.

The Quality Payment Program offers physicians the choice between two paths in this transition to a to value-based reimbursement system. MIPS is the default payment model under which most physicians will initially participate, but there is another other option available to qualifying physicians ahead of the curve and already utilizing certain innovative payment models.

Physicians sufficiently participating in Advanced Alternative Payment Models (APMs) are provided a 5 percent bonus payment and are exempt from MIPS reporting. And while most won't initially qualify for this track, physicians will be increasingly incentivized to adopt the Advanced APM pathway as potential payment bonuses become more lucrative as MACRA moves beyond its infancy.

This path should also offer a sense of familiarity for some. There are already numerous Alternative Payment Models in existence that incentivize participating physicians to engage in population health strategies and value-based care delivery. Advanced APMs are a new subset requiring participating physicians to take on even greater risk -- and potential reward -- related to patient outcomes.

For an APM to qualify as 'advanced,' the following requirements must be met:

  • Require participants to use certified EHR technology
  • Base payment on quality measures similar to the quality measures identified under MIPS
  • Require physicians to bear more than nominal financial risk for monetary losses, or is a Medical Home Model expanded under CMMI authority

Given these criteria, most APMs won't qualify as 'advanced' in 2017. The CMS shortlist of Advanced APMs includes the Medicare Shared Savings Program (Track 2 and 3), Next Generation ACO Model, Comprehensive ESDR Care, Comprehensive Primary Care Plus and Oncology Care Model. CMS will work to grow this list in the coming years, but for now the options are clearly limited.

Making it even more difficult to qualify for reimbursement on the Advanced APM track is the participation requirements associated with these models. To earn the distinction of 'Qualified Provider' and thus earn the 5 percent bonus payment in 2019, physicians must receive 25 percent of their Medicare Part B payment or see 20 percent of their patients through the Advanced APM. And after 2021 these thresholds increase considerably.

"There's a lot of good that will come out of MACRA, but one thing they definitely got wrong is the steep qualifying requirements for the Advanced APM track," said John Billi, MD, of the University of Michigan Health System and MSMS Board member. "From the perspective of both the physician and CMS, the Advanced APM pathway is the preferred route, so why not make it easier to initially qualify? Starting small and gradually increasing the risk requirement over time would have provided practices the opportunity to accrue the experience and infrastructure necessary to effectively manage and understand all the complex contributing factors to the total cost of care, which is one of the primary objectives of MACRA."

In total, CMS estimates that only four to 11 percent of participating clinicians will qualify for the Advanced AMP track in 2017. Almost making the cut does count for something though. Those not meeting the participation threshold or participating in APMs not categorized as "Advanced" will favorably impact your payment adjustment as long as you're also reporting to MIPs.

So, what's does this all mean for me?

The simple answer: it depends.

MACRA is comprehensive legislation that will bring forth major changes and investment in medical reporting technology and infrastructure and its impact will undoubtedly be felt throughout the medical community, but the immediate effect it will have on the individual level will be different for every provider.

CMS has earmarked $100 million to be spent on technical assistance and training over the next five years for MIPS-eligible physicians in practices with 15 or fewer clinicians and those providing services in rural and underserved areas. This money will be distributed to a variety of organizations including regional extension centers. Practices lacking the technical infrastructure required of MIPS should certainly make it a point to take advantage of this additional support.

Additonally, CMS, the AMA, MSMS and other organizations whose members are impacted by MACRA will have an extensive amount of literature and training resources available to guide physicians through the transition. MSMS will have a full calendar of in-person and online education to help physicians navigate MACRA. Two all-day sessions have been scheduled on May 5 in Grand Rapids and October 25 in November. Topics include how to get started, documentation using technology, and quality clinical registries. Online modules on these topics will also be available early this year. Please visit for the latest updates.

"My advice to physicians out there looking for additional support -- especially small practice primary care physicians -- is look to MSMS, the PRIME registry, look to your CIN, and look to your physician organization and specialty societies," said Craig Ross, MD. "There's a tremendous amount of resources out there to help physicians navigate their way through this."

The best advice: take it one step at a time and focus on what you can control.

"Small or large, urban or rural, every physician and eligible clinician will face challenges with MACRA implementation," Hettiger said. "But don't get too bogged down in the details initially. First ask yourself 'where do I fit in?' and once you've figured that out, evaluate what you're already doing and how that fits into this new Medicare payment structure. I think a lot of physicians are going to be pleasantly surprised by how much they're already doing that's perfectly aligned with the requirements of MACRA."