What To Expect in 2017: Managed Care Year in Preview

MACRA: A soft opening seems in store


Susan Ladika

American health care is looking like a storm-tossed sea of uncertainty these days, with the talk of scuppering of the ACA and Republicans floating the idea of moving Medicare to a voucher system. Despite its complexity and swarm of new acronyms, MACRA seems like a habitable dry land in comparison—predictable, supported by both parties, and adjusted in the final rule so its effect on providers in 2017 will be milder than feared.

Still, MACRA is one of the biggest changes to Medicare in the program’s 51-year history. The law, which passed by large bipartisan margins in the House and the Senate and was signed into law by President Obama, is designed to make good on the promise of value-based care and its “value over volume” slogan. And with the aging of baby boomers, Medicare’s huge influence on how American health care is delivered and paid for is only getting larger. In 2016, there were about 57 million Medicare beneficiaries.

As of July 2016, half of U.S. physicians had not even heard of MACRA. (Deloitte)

MACRA doesn’t start affecting Medicare payments to providers until 2019, but 2017 is the first performance year that will be used to determine those 2019 payments.

The final rule for MACRA, released by CMS in October after thousands of comments on the proposed version poured in, means next year will be a gradual introduction to the rigors of MACRA. The rule set up a variety of “pick your pace” options for clinicians who choose the Merit-based Incentive Payment System (MIPS) track. For example, they can test the waters by reporting just a few pieces of data or by participating for less than the full calendar year. They won’t be penalized in 2019 for taking a cautious approach in 2017 but will not be eligible for the full bonus payments if they go that route.

CMS also softened the final rule so providers won’t be judged on the cost of care they provide to Medicare patients next year. Eventually, though, cost will be weighted to account for a hefty 30% of a provider’s overall performance score on MIPS.

The longer on-ramp garnered praise from leaders of the American Medical Association, the American Academy of Family Physicians, and other groups. Those craving common ground in health care policy and regulation might take note.

The overall structure of MACRA puts providers—mainly physicians but the list of “eligible clinicians” also includes physician assistants, nurse practitioners, and others—into one of two payment Medicare tracks, MIPS or the Advanced Alternative Payment Model.

Most providers are expected to be on the MIPS track, which will give providers a score based on their performance in four weighted areas—quality (which supersedes the Physician Quality Reporting System), advancing care information (replacing the unpopular meaningful use program), cost (replacing the Value-based Payment Modifier), and clinical practice improvement activities (a new category). CMS will pay bonuses or collect penalties based on those scores. MACRA does give providers a lot of choice. In the quality area, providers need to report on just six quality measures, and there are 272 from which to choose.

Providers can escape the welter of MIPS requirements and get into the Advanced APM track if they participate in CMS programs that involve a considerable amount of downside risk; in 2017, that means 8% of all Medicare expenditures. The downside risk requirement means that most of the Medicare Shared Savings Program (MSSP) ACOs won’t pass muster as Advanced APMs, although CMS is apparently considering creating a Track 1+ model that would. MSSP Track 2 and 3 ACOs, Next Generation ACOs, Comprehensive Primary Care Plus, and the two-sided version of the Comprehensive End-stage Renal Disease Care Model will count as Advanced APMs. Want some more initials to toss around? The APMs that don’t qualify as Advanced APMs are going to be called MIPS APMs.

Some had seen MACRA as the final straw on the backs of solo practitioners and small group practices. It may not make the problem go away entirely, but the final rule does exempt providers who see 100 or fewer Part B Medicare patients or whose Part B allowed charges for the year were $30,000 or less.

MACRA, like the ACA before it, has spawned a torrent of white papers, FAQs, webinars, and consulting opportunities. So Austin Weaver, a senior director at the Advisory Board, weighs in with some advice: Providers should start collecting data sooner rather than later, so they have a better chance of being ranked a high performer and receiving a bigger financial payout. Beyond its direct financial ramifications, MACRA may eventually affect provider reputations because the information on physician performance will be made public.

MACRA-generated information and scoring may be used by health insurance companies, notes Weaver. “Commercial payers like to have a way to evaluate their providers.”

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