What Hematologist Need to Know about the Medicare Merit-based Incentive Payment System

Good to understand MACRA – but don’t panic (Part 1)

In April, 2015, the Medicare Access and CHIP Reauthorization (MACRA) was signed into law by the President. The headline at the time of passage was the end of the Sustainable Growth Rate (SGR) formula that had for so many years mandated large annual Medicare payment cuts to physicians. This calculated approach was replaced with a fixed payment update of 0.5% per year from 2016-2019, followed by flat payment rates for five years. However, MACRA did not just affect the overall payment mechanism – it also created a new pay for performance system for physicians. Many of these elements are similar or identical to the existing pay-for-performance program in Medicare but we will highlight some of the differences.

In 2015, nearly all hematologists are subject to adjustments to Medicare payment based on the quality of care provided and resources used by patient attributed to them. Medicare assesses quality performance primarily on the basis of measures selected by physicians under the Physician Quality Reporting System (PQRS). Medicare assesses resource use by attributing patients to physicians and making physicians responsible for those patient’s costs. In addition there is also a separate program that can affect payments that rewards for the “meaningful use” of electronic health records. Physicians who have electronic health records which met certain strict standards received bonuses for a number of years. As the bonus program has concluded, those who are not “meaningful users” of technology that meets current certification standards will have Medicare payment cut.

Together, all of these programs could have an impact of up to six percent of a physician’s Medicare payments. Starting in 2019, these programs are ostensibly eliminated, but replaced by a single pay-for-performance program that borrows liberally from these predecessor programs.

The new pay-for-performance program is referred to as the Merit-based Incentive Payment System (MIPS). In 2017, four percent of a physician’s revenue will be subject to payment adjustment based on performance in this program. That percentage gradually increases until it hits nine percent in 2022. The law also specifies how much weight to give each of the four components of the program, which include the three discussed above, as well as a fourth called “clinical practice improvement activities.”

Much like the present system, the MIPS program is budget neutral, meaning that bonuses and penalties to physicians must ostensibly be equal. While some of the calculation methods have changed, this means that the vast majority of physicians will see very modest impact from this program and it will be remarkably similar to the current programs.

As is usual in legislation, much of the details of implementation are left to the administrative branch of government. ASH recently responded to a Request for Information on the issue, offering detailed comments. Although it is going to be a few years before payments are affected under this new system, we have provided an analysis of the key elements below. ASH’s letter also covered a separate issue on the establishment of alternative payment models and we will explore that in a later post.

Clinical Quality

ASH expects that physicians will be assessed for clinical quality on the basis of quality measures that they will select similar to the current Physician Quality Reporting System (PQRS). In the long term, data for measures will likely have to come from a clinical data registry or an electronic health record. Because of recent expanded opportunities for registries, there should be quality measures that are at least close to relevant for most hematologists. ASH is currently considering whether to develop more clinical quality measures for hematologists. ASH’s comments to CMS encouraged the availability of a small set of cross-cutting measures that would be relevant for most specialties with special allowances for those that may have unusual clinical responsibilities.

Resource Use

Resource use measures are much less understood than clinical quality measures. Many physicians are not aware that they are being measured for resource use now. Part of this legislation requires that in the future, physicians will need to code their role with the patient, whether they are serving in a care coordination or consulting role. This may help to address some of the crude attribution models of today that many physicians find unsatisfactory. ASH encouraged CMS to establish an even playing field for considering the resource use costs associated with drugs. Currently, resources associated with physician-administered drugs are included in resource use measurement but those associated with patient-administered drugs are not. The comments also addressed the issue of what to do when a physician does not have enough patients attributed to calculate a resource use score and how to risk adjust for expected costs in patients.

Electronic Health Record Use

What had been seen as a great opportunity to install electronic medical records as part of the stimulus bill in 2009 has turned into a penalty program. Many physicians who purchased and used electronic health records have found that their systems are unable to keep up with the extremely high standards established in meaningful use. This is one area in which the new law should improve things for physicians. The current meaningful use program is scored “all or nothing” meaning that a physician missing a single required element of meaningful use is penalized. ASH hopes and has encouraged CMS to change this scoring so that physicians who are compliant with some elements of meaningful use receive partial credit.

Clinical Practice Improvement

One truly new element of the MIPS program is the inclusion of a measurement of clinical practice improvement activities. This is broadly defined in the legislation and could include such elements as keeping extended office hours, participating in a clinical registry, or receiving certification as a medical home practice. Clinical practice improvement activities account for only 15 percent of the overall MIPS score. ASH’s comments encouraged CMS to make participating in this activity as low burden as possible and encouraged CMS to not create a complicated scoring or weighting method for participating in the program.

Where Do We Go Next

ASH will continue to work closely with CMS to ensure that the program that is created is fair to hematologists and encourages quality improvement. We will continue to inform members as the requirements of the program become clearer in the coming years. Soon, ASH will post a second part of this article focusing on the alternative payment model side of the equation which is a potential different path for physicians under this new payment system.

If you have any questions, please contact Brian Whitman, ASH’s Senior Manager of Policy and Practice at bwhitman@hematology.org