Navigating Healthcare Payment Reform
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Navigating Healthcare Payment Reform

Path to Value: Navigating the New Normal in Healthcare Payment Reform; Quality Reporting through MACRA, MIPS, and VBP


CMS is transitioning to what the they call "a new and more responsive regulatory framework." This new framework will be based on the landmark bipartisan legislation called MACRA. Medicare Access and CHIP Reauthorization Act (MACRA) signed into law on April 16, 2015 permanently repeals the Sustainable Growth Rate (SGR) formula for reimbursements enacted under the Balanced Budget Act of 1997. CMS's goal is "…electronic health records helping physicians, clinicians, and hospitals to deliver better care, smarter spending, and healthier people," said Patrick Conway, M.D., CMS deputy administrator for innovation and quality and chief medical officer.

Over the next couple years, we will see a transformation of fee for service into value-based care models driven by the Quality Payment Program, MACRA, Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APM). Healthcare organizations will no longer be motivated by implementing and meeting Meaningful Use, but instead will be driven by value-based care and risk-based payment models that focus on quality outcomes for reimbursements.  Providers must find ways to improve the value of care they provide in a meaningful, measurable way. Providers will be responsible for their patients cost and quality of care throughout the continuum of care, regardless of which providers actually deliver the service.

Below is a summary of the changes and the impact on organizations and providers.

MACRA ends Sustainable Growth Rate (SGR)

Starting in 2017! The MACRA proposal puts an end to the to the SGR for determining healthcare provider reimbursements. The new framework establishes a new system for providers rewarding better care not just more care. The new payment model framework officially starts on January 2019 based on your 2017 performance measures. This means 2017 performance measures and costs will determine your 2019 payment adjustments.

Affected clinicians are called “eligible clinicians” (EC) and will participate in MIPS. The types of Medicare Part B eligible clinicians affected by MIPS may expand in future years.

List of Eligible Clinicians under MIPS

MACRA MIPS Eligible Clinicians

Merit-based Incentive Payment System (MIPS)

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) requires the establishment of a Merit-based Incentive Payment System (MIPS) and consolidates certain aspects of a number of quality measurement and federal incentive programs for Medicare physicians and other providers into one more efficient framework.  MIPS was created to consolidate the disparate CMS incentive and penalty programs that exist today; Meaningful Use, PQRS and VBM.

The separate payment adjustments that are determined under PQRS, Value Modifier and Meaningful Use will all sunset as of Dec 31, 2018. Combining the existing quality reporting programs into one system, MIPS.

MIPS only applies to office-based physicians or other clinicians who are reimbursed by Medicare. It does not apply to hospitals, facilities, or Medicaid. The MIPS program will be administrated at the NPI level and will phase out TIN level requirements. Starting in 2017 reporting year, CMS will start with a small set of providers and starting in 2019, any provider with an NPI will be subjected to the MIPS program.

Currently there are multiple individual quality and value programs for Medicare physicians and practitioners where quality measurement reporting is tied to payments.

PQRS, Meaningful Use and Value Modifer

Future direction of quality reporting and payment reform will be scored on a scale of 0 to 100.

Total composite scoring is made of up of four weighted categories:

  • Quality (50%)
    • 6 CQM measures selected by EC (Reduced from PQRS’s 9)
    • 200 measures to select from – over 80% pertain to specialists
  • Advancing Care (25%)
    • Emphasis on interoperability and information Exchange
    • Eliminates “All or Nothing” scoring
  • Resource Use (10%)
    • Pulls from Value Modifier
    • Claims reporting on cost and quality
  • Clinical Improvement (15%)
    • Care coordination, patient satisfaction, access measures

MIPS Performance Category Weights

Consumers will be able to look at providers rated on MIPS performance and how they compare to their peers nationally. The level of transparency is far more than anything we have seen from CMS and with the current physician compare programs. MIPS simplifies the application of incentives and penalties for MU, PQRS, VBM programs while continuing to measures quality performance scoring as specified by each of the programs.

In response to a transition to quality measures, the CMS developed a standardized system for developing and maintaining the quality measures used in its various accountability initiatives and programs. The quality measures will be reviewed and finalized annually through a call for quality measures process. CMS has budgeted $75 MM for quality measure development as we move to EHR quality reporting.

Revenue at stake

Each category is weighted differently and every provider in the country will be scored. The mean or median of all providers will be determined and become the performance threshold. If the MIPS score exceeds the threshold then your Medicare part-b fee schedule will be higher than what's published, if it's below the threshold then your entire Medicare part-b fee schedule adjustment will be cut below published amount.

MIPS Payment Adjustments

Advancing Care Information replaces Meaningful Use

Meaningful use of certified EHR technology is renamed to "Advancing Care Information" and the measure criteria is streamlined with emphasis on interoperability, information exchange and security measures. Clinical Decision Support and Computerized Provider Order Entry (CPOE) are no longer required. Advancing Care provides greater flexibility in meeting reporting requirements allowing physicians or clinicians to choose which best objective and quality measures fit their practice.

Beginning in 2017, physicians and other clinicians who currently participate in the Medicare Physician Meaningful Use program will no longer report or attest for this program and will instead report through MIPS. In 2017, eligible clinicians have the option of using a 2014 edition or 2015 edition certified technology. In 2018, eligible clinicians will be required to utilize 2015 edition certified technology and report on six Stage 3 measures.

Submission requirements for CY 2017:

  • Submission for full year, CY 2017, Objective Measures
  • Requires 2014 or 2015 Edition Certified EHR
  • Report on either (8) stage 2 or (6) stage 3 Advancing Care Information objectives and measures
  • Attest to cooperation with certain authorized IT surveillance and oversight activities

Opportunities and Challenges

As CMS moves to tie payments to outcomes, quality, value and practice improvement; organizations will need quality reporting and management tools to aggregate data from various source. Given efficiencies gained with electronic and consolidated reporting, organizations will have an opportunity to spend less time on patient data curation and interpretation and more time on developing strategies to positively impact actual patient outcomes. Clinical documentation improvement (CDI) will be a critical component of this transition to quality based reimbursement.  Without skilled clinical documentation and coding, organizations risk lost revenue.  Clinical documentation teams will identify ongoing documentation and coding opportunities that improve the clarity and medical necessity of services provided.  This will result in a more accurate reflection within the EHR of patient’s status and acuity level which will positively impact reimbursement. 

Organizations and providers will need to aggregate data from hospitals, physician clinics, home health agencies, skilled nursing facilities, providers, payers and patient devices for predictive and retrospective analytics to improve patient outcomes, quality and wellness.  Organizations will need quality reporting and management tools that can track and report populations of patients with specific conditions, perform concurrent review reporting, generate rules based alerting, and provide ad-hoc reporting for the patients care team.  Additional challenges include real time assessment of quality performance, identifying patients with alerts and actionable events who are falling outside the measure performance and tracking patients with chronic conditions.

Over the course of the year the Quality Payment Program reporting requirements will evolve and the MACRA/MIPS reporting requirements will be finalized in the fall. As reporting requirements become more defined through law, we will be updating our blog content to reflect the changes.

In case you missed it, Jodi Frei, Manager of Clinical Informatics from Northwestern Medical Center, and I presented at the MEDITECH Nurse and Home Care Forum 2016 on strategies associated with electronic Clinical Quality Measure (eCQM) submission; we have archived the presentation for you In a Galaxy NOT So Far Far Away... eCQMs.

If you are attending the MEDITECH Physician and CIO Forum 2016 conference in October, Jodi and I will be presenting on clinical quality payment reporting. Looking forward to seeing you there.


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CMS has clarified that statement,

By Acmeware at 19 Jul 2016, 16:16 PM



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