CMS Expands Exemptions and Flexibility in Final MACRA Rule

Guest post Ken Perez, vice president of healthcare policy, Omnicell.

Ken Perez
Ken Perez

On October 14, the Centers for Medicare & Medicaid Services (CMS) released a 2,171-page final rule for the implementation of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). CMS had issued a proposed rule on April 27 and in the intervening period, more than 100,000 physicians and other stakeholders attended outreach sessions and CMS received more than 4,000 public comments on the proposed rule, with many of the expressed concerns pertaining to the start date for MACRA’s first performance period.

MACRA’s Quality Payment Program replaces the unpopular sustainable growth rate formula and defines how physicians in physician practices—not hospitals—will be reimbursed by Medicare. It features two alternative, interrelated pathways: the Merit-based Incentive Payment System (MIPS) and advanced alternative payment models (APMs). MIPS is designed for providers in traditional fee-for-service Medicare, while the advanced APMs are for providers who are participating in specific value-based care models, such as accountable care organizations (ACOs).

Small physician practices with less than $30,000 in Medicare charges or that see fewer than 100 Medicare patients per year are exempt from MIPS. According to an analysis by the American Medical Association, 30 percent of physicians are below one or both of these thresholds. In addition, providers new to Medicare in 2017 are also exempt (though just for the first year).

The proposed rule specified Jan. 1, 2017, as the start date for the first performance period under MIPS, which would drive calendar year 2019 payment based on performance in 2017 across the four MIPS categories: Quality, Advancing Care Information, Clinical Practice Improvement Activities, and Cost/Resource Use. The final rule allows providers to start collecting performance data anytime between Jan. 1 and Oct. 2, 2017, with data due to CMS by Mar. 31, 2018.

Under MIPS, physicians can earn in 2019 a payment adjustment that is neutral, up to 4 percent positive, or up to 4 percent negative, depending on their level of participation, the amount of data submitted, and the length of the performance period reported. The adjustment increases to plus or minus 5 percent in 2020, plus or minus 7 percent in 2021, and plus or minus 9 percent in 2022. CMS projects that 592,000 to 642,000 clinicians will submit data for MIPS during the first performance year.

The advanced APM pathway allows physicians to avoid the MIPS reporting requirements and payment adjustments and earn a 5 percent lump sum incentive payment each year from 2019 thru 2024. Advanced APMs must use certified EHR technology, base payments on quality measures similar to MIPS, and require providers to bear downside risk within one of the following advanced APMs for 2017, all of which are types of ACOs: the Comprehensive ESRD Care Model (two-sided risk arrangements), the Comprehensive Primary Care Plus Model, the Medicare Shared Savings Program Tracks 2 and 3, or the Next Generation ACO Model. Other types of value-based care models will be added to the list of approved advanced APMs the future. CMS estimates that more than 125,000 clinicians will participate in advanced APMs in the 2018 performance year.

In general, healthcare industry associations responded favorably to the final rule. The American Medical Association, the American Academy of Family Physicians and the American Medical Informatics Association all expressed appreciation to CMS for addressing most of their concerns. Given this response, it appears that CMS, in its formulation of the final rule for MACRA’s implementation, has to a great extent succeeded in practicing the art of the possible.

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