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Final MACRA Rules

On October 14, CMS issued the final MACRA rule. This new Medicare reimbursement system is
known as the Quality Payment Program (QPP). It offers two reimbursement options for physicians, including the Advanced Alternative Payment Model (APM) and the Merit-based Incentive Payment System (MIPS). CMS says 2017 will be a “transition year and iterative learning and development period.” 2018 will be the “second transition year.”

CMS will provide more information for 2020 and beyond beginning next year.   Key points: 1) If a physician doesn’t bill at least $30,000 in Medicare Part B allowable charges or they see less than 100 Medicare patients per year, they are exempt from QPP. This includes more than 30% of all physicians who are billing for Medicare Part B services (more than 380,000) 2) CMS will collect data on costs – but only behind the scenes. This MIPS pillar will not count for the 2017 performance year; its “weight” was transferred to the Quality category 3) Only four activities need to be reported by physicians – and none if they are already recognized as a medical home 4) CMS is committed to increasing the number of physicians who are in APMs – and it estimates that 70,000 to 120,000 physicians (5% to 8% of all physicians billing under the Medicare Part B) will qualify as an APM participant in 2017 5) The number of EHR “meaningful use” (now known as “Advancing Care Information”) requirements dropped from 11 to five – but it is still necessary for physicians to report on most of them to achieve a score of 100%.

The QPP begins in 2017 – with MIPS reporting required by March 31, 2018. This initial performance year establishes a provider’s Medicare payments in 2019 – with an adjustment of 4% up or down. If a physician fails to submit any 2017 data (i.e., qualify for the program), they will receive a negative 4% payment adjustment. If a physician transmits a “test” – e.g., one quality measure, one improvement activity, or the required ACI measures – they will avoid the penalty; a partial year of reporting will result in a neutral or small positive adjustment. The full year provides for a “moderate” positive payment adjustment.

Qualifying participants who achieve a final score of 70 or higher will be eligible for the exceptional performance adjustment – which will be funded from a pool of $500 million.  MIPS allows reporting by an individual or group. Qualifying professionals are defined as physicians, physician assistants, nurse practitioners, clinical nurse specialists and certified registered nurse anesthetists.  The cost category is eliminated for the first performance year (2017) – so Medicare reimbursement is tied to the remaining three: Quality, Clinical Improvement Activities, and ACI, which account for 60%, 15% and 25%, respectively, of the composite score that will determine your Medicare adjustment in 2019.

Participating in an APM offers an automatic 5% incentive payment for all Medicare patients. Less
than 100 organizations qualify for an APM today – and many physicians in those organizations
won’t reach the CMS threshold of receiving 25% of Part B payments or seeing 20% of its
Medicare patients through the APM. More importantly, the application period to join an APM in
2017 has passed. CMS expects about 25% of eligible clinicians to be part of the second path of
APMs in 2018.

Elizabeth Woodcock

Elizabeth Woodcock is one of the leading third party payer and medical practice management
consultants in Georgia. She is a professional speaker, trainer and author. Woodcock has focused
on medical practice operations for more than 20 years. She has delivered presentations at regional and national conferences to more than 200,000 physicians and managers.

In addition to her popular email newsletters, she has authored 15 best-selling practice management books and published dozens of articles in national health care management journals. Woodcock is a fellow in the American College of Medical Practice Executives and a certified professional coder. In
addition to a degree from Duke University, she has an MBA in health care management from The
Wharton School of Business of the University of Pennsylvania.