For physicians anxiously awaiting CMS' rule for future Medicare Part B payments, an answer arrived last week in a 962-page proposal, shedding light on meaningful use, quality measures, the timeline and eligibility requirements for the various payment models.
Following the repeal of the sustainable growth rate formula, physician Medicare payments were re-envisioned under the Medicare Access and CHIP Reauthorization Act, which begins measuring performance in 2017 for payments starting in 2019. The act aims to streamline quality reporting programs and create a framework to reward physicians based on performance.
MACRA does this through two tracks for physician Medicare Part B reimbursement — the Alternative Payment Model, which is the more lucrative track, and the Merit-based Incentive Program, which is the default model. With the first potential performance year just eight months away, physician practices have been waiting to find out additional details about the program, particularly what will qualify as an APM.
We caught up with David Muhlestein, PhD, senior director of research and development at Leavitt Partners in Salt Lake City, to discuss the details in the proposed rule and what they mean for physician practices. Dr. Muhlestein highlighted four major takeaways from the proposed rule, which is open for comment until June 27.
1. Only two-sided risk programs will qualify as advanced APMs.
CMS has already received some criticism for its lack of flexibility in determining what makes an advanced APM — the track of the program that pays a lump-sum bonus of 5 percent of the estimated aggregate expenditures under the fee schedule for the prior year. To qualify for the 5 percent bonus, providers must be in the Medicare Shared Savings Program Tracks 2 or 3, a Next Generation Accountable Care Organization, Oncology Care Model with two-sided risk, Comprehensive End Stage Renal Disease Care or in the Comprehensive Primary Care Plus models. Essentially, it requires downside risk, and it must be "more than nominal financial risk." CMS' proposed rule would require providers to have a minimum of 30 percent marginal risk, a minimum loss rate of no more than 4 percent and total potential risk that amounts to at least 4 percent of expected expenditures, according to a Leavitt Partners analysis.
"The challenge though is that Medicare wants to move people toward risk and they don't want to give away bonus payments if people are not actually taking risk," Dr. Muhlestein says. The 5 percent bonus payments represent an opportunity to offset potential risk, he says, and a generous opportunity at that. Most ACOs are not losing 5 percent and even the lowest performers are not getting a 5 percent penalty, according to Dr. Muhlestein.
"Five percent is not insignificant in bonus payments," he says. "It could be the weight that tips things in favor of people moving [to downside risk.] But the timing is really difficult. If you have not put anything in place to become an APM two-sided risk ACO basically by the end of this year, you are probably not going to make it."
2. The MACRA rule represents one of CMS' most flexible offerings to date.
Though many providers are concerned about what qualifies as an advanced APM, most providers will fall into the MIPS track in 2017, Dr. Muhlestein says, and what CMS has done with MIPS and MU specifically is very unique. It retooled the MU program so practices can pick and choose from a menu of quality measures they would like to be graded on. "The idea here is every quality measure doesn't match every practice. If you are a primary care physician, some things are really relevant to you, but if you are an orthopedic surgeon, they might be really irrelevant," Dr. Muhlestein says.
The customization under MIPS is a first for CMS, according to Dr. Muhlestein. "I would say it's a very innovative approach given their constraints for standardized metrics and standardized protocols," Dr. Muhlestein says. "I would give them a gold star for that."
3. The timing of the proposal means providers must make strategic decisions ahead of the final rule.
Dr. Muhlestein foresees the presidential election as a potential obstacle to the final rule's timeline. "CMS historically is reluctant to put major pieces of regulation out before a major election," Dr. Muhlestein says. Though it could be extended, MACRA's comment period lasts 60 days. In a best-case-scenario, the final rule will drop by the end of August, according to Dr. Muhlestein. However, August is a tight deadline considering CMS will have hundreds of comments to read, discuss and weigh against feedback from the White House before crafting the final rule. "Say we get to September and they haven't put a regulation out. There's a good chance they will say, 'We're not going to put it out until the end of the election,'" Dr. Muhlestein says.
Currently the proposed rule sets calendar year 2017 as the first performance year to determine payments in 2019. This could change in the final rule, but due to timing, providers will have to prepare as if 2017 is the definitive start date. "People will have to start making strategic decisions based on the proposed regulations," Dr. Muhlestein says. "You can't start an ACO in six weeks."
Another interesting factor associated with election season is the possibility of a number of high-profile administrative departures from CMS, according to Dr. Muhlestein. While this may not directly impact MACRA, it makes for an interesting rule-making environment.
4. Providers are already concerned about a handful of broad-level measures.
Though many intricacies of the proposed rule will be challenged during the comment period, Dr. Muhlestein highlighted several measures certain to provoke pushback. On the MIPS track, MU details are certain to garner attention, particularly the requirement that providers report or not get a score at all.
As for the APM track, providers will likely call for more flexibility. Currently the rule says the only models that qualify as advanced APMs are Tracks 2 and 3 of the MSSP and a handful of pilot programs being tested under the Center for Medicare and Medicaid Innovation. Dr. Muhlestein says by limiting models that qualify as advanced APMs, CMS may be trying to incentivize providers to participate in its relatively new innovation models before they have been proven. Dr. Muhlestein forecasts significant conversation around this theme.
"CMS' strategy is they try to push things really far in the proposed regulation so when people come back and criticize it they are able to step back a little bit and get what they really want," Dr. Muhlestein says, though he doesn't foresee many changes to advanced APM criteria due to the limited number of advanced models in existence.
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