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Five Things You Should Know About MACRA


Because the replacement for Medicare's SGR is complex and potentially difficult to participate in, physicians must arm themselves with knowledge.

Medicare and Medicaid are pushing for three goals in healthcare: improved care, wiser spending, and healthier people. The latest program to transition away from fee-for-service toward value-based payment systems is MACRA, which plans to focus on three areas: physician incentives, care delivery, and information sharing. For those groaning at a new program in the wake of the Meaningful Use requirements brought forth in 2009, CMS believes the new program will be an improvement with more flexible paths to success and ability to customize reportable measures to better fit specific practices.

1. What is MACRA?

MACRA stands for the Medicare Access and CHIP Reauthorization Act of 2015, a bipartisan legislation passed into law in April 2015. According the CMS the goal of this legislation is to "reward better care, not just more care." The primary goal is to move away from fee-for-service reimbursement toward a value-based payment system, with a goal of 85 percent of all Medicare payments being tied to quality or value. It also repeals the flawed Sustainable Growth Rate (SGR) which has plagued physicians since its inception in 1997, and since 2010 has threatened to cut fees to physicians for the services they provided by up to 25 percent, although Congress has persistently delayed its implementation. This repeal was seen as a great victory for physicians, but the remaining aspects of the legislation are still confusing. CMS purports this new plan will be more flexible and easier for physicians. Within the new Quality Payment Program there are two paths for physicians to participate: Merit-Based Incentive Payment System (MIPS) and Alternative Payment Models (APMs).

2. What is MIPS?

MIPS will subject physicians participating in Medicare Part B to a performance score composed of four categories: quality, resource use, clinical practice improvement activities, and Meaningful Use of EHR technology. Starting in 2019, this composite score will be used to adjust payments up or down by a designated percentage. In 2019 that percentage will be +/- 4 percent and increase to +/- 9 percent by 2021. Additionally, MIPS adjustments are required to be budget neutral, so the increased adjustments must equal the downward adjustment, and upward adjustments may be subject to a scaling factor and thus potentially less than the projected percentage. MIPS will only apply to individual physicians and not to hospitals or facilities. Additionally, three groups of physicians will be exempt from MIPS: those in their first year of Medicare participation, those in the APMs that qualify for bonus payments, and those whose panel of Medicare patients fall below the low volume threshold. The measurement systems for the categories already exist under three systems: Physician Quality Reporting System, Value Based Modifier Program, and Medicare Electronic Health Record Incentive Program ("Meaningful Use"). These programs will be combined into one reporting system under MIPS with some changes that are purported to have more flexibility, accommodating different practice methods and goals as well as elimination of the "all or nothing" measurements. Initially, CMS believes that most Medicare providers will participate in MIPS, but eventually most will progress to an APM.

3. What are APMs?

Alternative Payment Models or APMs are the second track for MACRA. CMS hopes to utilize these new approaches to payment by incentivizing quality and value. Some examples of APMs include some Accountable Care Organizations (ACO) and Patient-Centered Medical Homes (PCMH), as well as many other models being tried around the country. However, only some of these current APMs will be eligible. Participants in APMs that are not deemed eligible will still be able to participate in MIPS but their participation in the APM will give them favorable scoring in the clinical practice improvement activities performance category, allowing for both APM-specific rewards and the MIPS payment adjustment. Those APMs that are deemed eligible will be considered qualifying APM participants ("QPs") and will be exempt from MIPS. Additionally, QPs will be eligible for APM-specific rewards, a lump-sum bonus payment for the period 2019-2024 of 5 percent, and, from 2026 on, a higher fee schedule. In order to be a QP, physicians must base payments on quality measures that will be similar to those in MIPS, must use an approved EHR, and either bear more than the nominal financial risk for losses or be an expanded medical home model. A specific percentage of the physician's patients or payments must be made through an eligible APM to qualify, and in 2021, this percentage may be made through a combination of Medicare and non-Medicare payer arrangements, such as private insurers.

4. When will this affect me?

MACRA is slated to begin the payment adjustments in 2019, however the performance measurements will actually start in January 2017. At this point, however, the final details (including metrics) are still being determined and are slated for finalization in fall of 2016. Currently there is opportunity for public comment until June 26, 2016 at:


5. Where do I get more information?

CMS has detailed information on its website. Additionally, the American Academy of Family Physicians, the American College of Physicians, and the American Medical Association offer information as well as toolkits for MACRA readiness to their members which can be accessed through their websites.









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