Moving Forward With MACRA: A Review of Progress, Changes, and Preparation

The convoluted journey from volume to value-based reimbursement continues, requiring providers, health systems, payers, and patients to adjust economically and operationally. Since the signing of the Affordable Care Act (ACA) in 2010, value-based reimbursement strategies have demonstrated success as well as failure, with a prevailing theme of uncertainty on both sides of the coin. A variety of programs and incentive structures have been tested by CMS, commercial payers, self-funded employers, and others. From Pioneer ACOs to NextGen ACOs and bundled payments to BPCI Advanced, we are experiencing value-based care 2.0 and should expect to see additional versions in the years to come.

The objectives remain consistent: reduce healthcare costs and improve clinical quality/outcomes while enhancing the experience for patients and providers alike—a worthy pursuit. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was intended to advance these initiatives by establishing the Quality Payment Program (QPP), which replaced the Sustainable Growth Rate (SGR) law that proved, ironically, to be unsustainable. QPP offers two tracks for Medicare clinicians to choose from:

  1. The Merit-Based Incentive Payments System (MIPS) updates and consolidates multiple previous CMS quality programs such as PQRS.
  2. Alternative Payment Models (APMs) provide incentive payments for high-quality and cost-efficient care related to a clinical condition, a care episode, or a population.

The year 2017 was the initial year of QPP reporting and was designed to promote success and elicit participation. More than 1 million clinicians participated in QPP, and almost 100,000 of those earned APM participant status, which provides additional financial benefit opportunity. Here, 93% of MIPS participants received a positive payment adjustment (maximum of 1.88%), and only 5% of clinicians received a negative payment adjustment (maximum of -4%). Small and rural practices performed significantly worse, but CMS now offers free support in the form of technical assistance to practices with 15 or fewer clinicians.

Additionally, QPP performance thresholds have increased from 3 to 15 to 30 points in 2017, 2018, and 2019, respectively, and CMS expects to continue increasing targets by 15 points annually. Penalty ranges for low performance also increased to a maximum of 7%, up from 5% in 2018, which will continue to raise the economic stakes for participants. Given the net neutral payment provision, there will be bigger winners and bigger losers moving forward. It will be interesting to see how a more significant risk-and-reward structure impacts participation.

The 2019 Final Rule introduced several key changes for MACRA and Physician Fee Schedules (PFS):

  • Expanded QPP eligibility to include more provider types as well as established an “opt-in” process for providers that did not meet previous volume requirements.
  • Revised the interoperability performance category for MIPS.
  • Increased PFS payment by 0.25% from 2018.
  • Providers can now bill separately for virtual communication with patients such as telehealth visits or reviewing photos and videos.
  • Providers are not required to enter redundant information already documented in medical records.
  • Delayed the proposed E/M billing code collapse for levels 2 through 4 until 2021.
  • Changed fee schedules and added new codes to recognize advances in communication technology and its significant role in the modern patient-provider relationship.
  • Created new E/M documentation guidelines to streamline payment and potentially reduce clinician burden.

MACRA is our current vehicle for the journey to value, but time will tell whether its programs and incentives can truly change provider and patient behavior, which is crucial for sustainable success with any model. CMS is taking a step in the right direction to improve access to care and more appropriately compensate physicians and health systems for their work. Technology will continue to play a key role in reporting and monitoring as evidenced by the increased focus on EHR interoperability in the 2019 MIPS scoring. Reducing documentation guidelines supports the CMS “patients-over-paperwork” initiative, and providers could potentially increase revenue with more efficient documentation leading to increased availability/access, streamlined coding, enhanced template utilization, and simplified billing processes. Regardless of MIPS participation, it’s imperative that providers better understand and prepare for the proposed E/M billing code consolidation in 2021.

Proactively Prepare Your Practice for Success:

  • Evaluate economic opportunity by modeling financial and quality metric performance.
  • Perform a coding audit and establish consistent documentation training.
  • Assess the compliance risks and opportunities for your practice.
  • Evaluate service offerings such as remote visits to maximize fee-for-service revenue.
  • Understand market dynamics and competitive landscape of value-based care.
  • Optimize value-based care infrastructure and operational efficiency to achieve full reimbursement potential.
  • Engage providers in operational improvements to drive desired clinical and financial outcomes.
  • Utilize the CMS-supported Transforming Clinical Practice Initiative (TCPI) and other free resources to alleviate the administrative burden of QPP participation.

Will MACRA advance us beyond basic data reporting and drive meaningful operational change along with clinical accountability at the provider-patient level? We’re poised to take a significant step forward, but the balance of incentives and risk must be more compelling, which cannot be accomplished overnight. Value-based care continues to be a game of timing, and each provider, group, and health system has unique circumstances to consider before participating in QPP or any other value-based programs. Many providers we work with have already engaged in some form of value-based incentives, but strategies are often fragmented with inefficient operational infrastructure. Success is predicated on a proactive and cohesive strategy that explicitly aligns incentives.

Let us know where you are on this journey to value and what you’ve learned along the way. And if you would like to learn more about how Coker Group can help support your organization, please contact us.

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