Strategies for Dealing with Value-Based Modifiers

March 25, 2015

Value-based reimbursement programs have arrived. Physicians can react with frustration or adjust their practices to meet the new metrics for payment.

As we know many payers are implementing various approaches to pay-for-performance reimbursement or value-based reimbursement programs. Medicare has announced significant goals in modifying payment models; rolling out value-based payment modifiers (VBPM) this year. Patient care activity in 2015 will impact every Medicare payment in 2017. Physician groups of 100 or more will have payments affected this year, groups of 10 or more in 2016, and all groups in 2017. Medicare will determine the amount of payment incentive or adjustment based on the information noted below. The range is from - 4 percent to + 4 percent of Medicare payments.

Below are some thoughts on how you can respond to VBPMs and optimize the care provided patients and maintain or gain financial viability.

1. Continue to participate in PQRS which is the basis for the Medicare Value-Based Payment Modifier program. Understand how your profile fits within the six domains (check meaningful use): clinical process/effectiveness; patient and family engagement; population/public health; patient safety; care coordination; and efficient use of healthcare resources.

2. Access your practice Quality and Resource Use Report, QRUR, by obtaining an IACS number from CMS. This report was published by CMS last fall and compares your practice to peers on both quality and cost measures. This can be downloaded in both PDF and excel formats. It's complex but worth spending time on to both understand and identify your practice profile.

3. Monitor your entire provider panel in key measures:


a. Preventable hospital admissions:

• Patients with acute episodes of dehydration, UTI, and bacterial pneumonia

• Chronic patients with heart failure, COPD, and diabetes

b. All cause hospital readmissions

Cost - your practice status:

a. All Part A and Part B payments (Part D excluded)

b. For disease categories: COPD, heart failure, coronary artery disease, and diabetes

c. Medicare Spend Per Beneficiary, MSPB, for three days prior to and 30 days post discharge

d. Total Medicare Allowable per applicable CPT code

4. Report monthly on what is occurring.

a. Your practice will not know the Medicare ranking until the end of period.

b. Rankings are determined by the eligible provider (EP) who has a "plurality" of primary-care codes assigned and the Medicare allowable charge amount assigned. Primary-care providers will be considered first, but any specialist may qualify.

c. A minimum of 20 episodes per measure (see quality above) hence the need to monitor your practice. If insufficient numbers are there, you may not see either the incentive or adjustment.

5. Regular review and reporting will help lead the practice toward a more "quality" impact and focus. Whenall staff,not just providers, work together, the cumbersome nature of reporting will become easier and part of everyday practice life - since in many cases the impact is not significant this year. It will however become more impactful in the years to come, as not only VBPM programs come into play, but overall payment model reforms are implemented. There will be an eventual culture change!

Long term outcomes for practices should be improved patient care, compliance with the new paradigm, and an improved financial picture. How you approach it now may determine the long-term success and viability of your practice in the future.

Online Resources:

• Medical Group Management Association, government affairs

• Medicare Value-Based Payment Modifier