This article is more than 5 years old. Information may no longer be current.
Medicare payment adjustments to be based on quality and cost
Click Here to Manage Email Alerts
In October, the CMS released the final rule to implement the Medicare Access and CHIP Reauthorization Act of 2015, effectively ending the SGR formula and introducing a new payment adjustment path for ophthalmologists who serve Medicare patients.
The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) ushers in the Quality Payment Program, which has two tracks for physicians to choose in regard to Medicare reimbursement.
Each track will now offer participants a performance-based payment adjustment for their Medicare payment, which will be built on evidence-based and practice-specific quality data, according to the CMS.
Image: Larson PM
Overwhelmingly approved
Unlike the Affordable Care Act, MACRA was overwhelmingly passed with bipartisan support and was unlikely to be changed before it was scheduled to go into effect on Jan. 1, Paul M. Larson, MBA, MMSc, COMT, COE, CPC, CPMA, a senior consultant at Corcoran Consulting Group, said.
“The important thing for people to understand is MACRA and MIPS (Merit-based Incentive Payment System) both have bipartisan support. Both Democrats and Republicans are on board with a move toward cost and quality in some form. We don’t think, at least based on our initial read of Congress and based on what the professional societies are telling us, that we will end up with a change or a deletion of the acts,” Larson said.
The Quality Payment Program will begin for ophthalmologists who are ready by Jan. 1, and performance data will begin to be collected. Those who are not ready to begin on Jan. 1 can choose to start with the new program any time between Jan. 1 and Oct. 2. All participants need to send in their performance data by March 31, 2018. The first adjusted Medicare payments based on performance will go into effect on Jan. 1, 2019, according to the CMS website.
MIPS effect on ophthalmology
The majority of ophthalmologists are likely to participate in MIPS, which will determine payment adjustments based on four categories: quality, improvement activities, advancing care information and cost (resource use). The quality category replaces the Physician Quality Reporting System, improvement activities is a new category, advancing care information replaces the Medicare EHR Incentive Program, and cost replaces the Value-Based Modifier, according to the CMS website.
In 2017, ophthalmologists will be judged on all categories except cost, which will go into effect in 2018. Each ophthalmologist will receive an annual MIPS score up to 100 based on total performance in each category. This final score will then determine the MIPS payment adjustment in the second calendar year following the performance year.
When the rule was released in October, the American Society of Cataract and Refractive Surgery sent an alert to its 9,000 members, updating them on the new rules and reimbursements for 2017.
About 99% of ASCRS members are reimbursed by CMS for Medicare patients, Nancey K. McCann, director of government relations, ASCRS, said.
“Right now, we’re educating our members. We’ve created guides, and those documents are on our websites for our members. They go into great detail for each of the components of MIPS. It gives an overview of the Quality Payment Program, it goes through each of the components, and we also have separate documents on the APMs (Alternative Payment Models), but our members will not be on that pathway, at least in the beginning,” McCann said.
MIPS determines bonuses
CMS took suggestions from several organizations, including ASCRS, American Academy of Ophthalmology and American Medical Association, for the new rules. For example, the ASCRS requested resource use not be counted in the first year of the MACRA/MIPS implementation, which was included in the final rule, according to McCann.
“As you can see, they made almost every change we asked for. Ophthalmology is positioned pretty well to get bonuses, just because we have a lot of measures to report. ... A lot of our members have been reporting through PQRS, and they have that experience. I think we’re in a pretty good place,” she said.
The MIPS score will also determine if an ophthalmologist receives a bonus or a penalty or is “neutral” for that year, according to Larson.
“If someone does nothing — they’re not doing quality, not doing meaningful use, not doing any of the improvement activities — they will get a 4% negative adjustment for what they do in 2017, and that 4% negative adjustment hits in 2019. That skip-a-year scenario makes everyone nuts, but the idea is that you have a year to file claims under Medicare; therefore it takes a little longer after the year ends for the data to be posted, for people to review it, for people to be notified and to have an appeal mechanism if there is a mistake,” Larson said.
Additionally, ophthalmologists who submit the full amount of data for at least 90 days to Medicare in 2017 may be able to earn up to a 4% positive payment adjustment, he said.
“Remember, any monies that are available for the bonus come from the people who are penalized. This is budget neutral,” Larson said. That is, if the majority of providers avoid the penalty, then there will not be a lot of money available for distribution.
MIPS vs. APMs
Payment in Medicare will become a divided system due to the division between MIPS and APMs, Michael X. Repka, MD, MBA, medical director, governmental affairs, AAO, said.
“Medicine, for payment, will be divided — who ends up in which program where the rules and impacts are different. If you’re an internist, you may be able to get the bigger bonus, the 5% bonus, if you can get the APM to work for you, for instance in a medical home. It doesn’t look like ophthalmologists will have the opportunity to get into APMs. APMs seem to be the preferred program by the Congress and the administration in terms of the future of physician payments,” he said. “They could continue to be preferentially treated.”
Because of the high percentage of ophthalmologists participating in Medicare — more than 95% of AAO members — MACRA rules and changes do matter. Repka said they should not expect any big tweaks or changes to the new rules in the near term.
“This law, even if it’s tweaked, will take years to have tweaks take effect because of the rule-making process. We are using the change in administration to identify as many changes we would like and advocate for those; we’ll probably have 2 years of the program largely as it is before there are major changes. From the Academy’s perspective, we want to see further simplification of MIPS and some access to the APM model for specialists,” he said.
Important to prepare
When the final rule was introduced in October, the changes for ophthalmologists seemed daunting at first, OSN Cornea/External Disease Section Editor David R. Hardten, MD, FACS, said.
However, MACRA and MIPS attempt to balance the overall cost and quality of procedures to provide the best possible care for patients, he said.
“At first glance, the MACRA/MIPS implementation appeared daunting to me as an ophthalmologist. As I’ve reviewed it, though, the overall goal is laudable, in that we are trying to improve the care for our patients, and thus as a practice, we are planning to work to implement it in our practice. If you look at the process over the next several years, I believe it is important to try to implement as many of the steps as possible, as soon as possible. While I don’t know if we will be successful financially by implementing these programs in our practice, I feel that it is still important to do so, primarily so that we are better positioned to comply in the future,” he said.
Ophthalmologists need to become educated about this initiative from the beginning so they can be prepared for any potential changes in the future, Hardten noted.
The first year of implementation is designed to ease ophthalmologists into the program. CMS calls it the “pick your pace” option, which lowers the bar significantly in 2017 to avoid a penalty, Larson said.
“You could just report one quality measure successfully on one patient. It’s a very low bar. If you’re thinking of walking down the sidewalk, this is sort of like a wet spot on the sidewalk — you can easily step over it (avoid the penalty). Option two is you can report a little bit more for 90 days — it’s not a whole lot more, it’s like a crack in the sidewalk — and the other two options are to report more for over a longer time frame. We think there’s a chance at steps three and four for bonus money. Even at the second option I talked about, the crack in the sidewalk, it has a small chance of earning a small bonus,” he said.
Exceptional performers bonus
Due to MIPS being budget neutral, if few physicians are penalized in the first year, then the bonus pool money will be small. However, CMS also announced it would include a $500 million pot of money over the first 6 years for “exceptional performers” who score a composite MIPS score of 70 or higher. This portion of the program is not budget neutral, Larson said.
“Depending on how many people do well, that money is divided up among the providers that do that. It’s based on a sliding scale — the better you do, the better chance you have to earn the significant exceptional performers money. It starts at 10% and goes up, but remember that pot of money, $500 million, it sounds like a lot. If a lot of people are ready in the first year and make scores of 70 or above, that money will be diluted,” he said.
Additionally, CMS is making it clear that physicians need to implement an electronic health records system in their practice. At some point in the future, not having an EHR system in a practice may make it nearly impossible to achieve a bonus, Larson said.
“At some point, not having an EHR puts you at a greater disadvantage in MIPS. Not during the first year or two, but it rapidly makes it harder to achieve bonus dollars after that. It may reach a point where it’s hard to avoid the penalties as well. Because there are no benchmarks out there that we can point to, if you aren’t already in the EHR yet, you need to evaluate this on a continual basis. I think this is going to take some office resources and will take an internal expert or two that people must devote resources to,” Larson said.
Do well in 2017
With the low bar and the exceptional performers fund, it is important to do as well as possible from the start, Joe Theine, practice administrator for the Four Corners Eye Clinic in Durango, Colorado, said.
The practice already reports data to the AAO’s Intelligent Research in Sight (IRIS) Registry, so reporting data for a full year is a goal the practice should be able to attain immediately, he said.
The practice has a young demographic of physicians, Theine noted, ranging from their 30s to late 40s, and all of them recognize that these changes will be a part of their future whether they like it or not.
“They’re incentivized to figure out how to succeed in this changing environment because they’re not retiring any time soon. We’re going after a portion of the $500 million pot next year. Part of the rationale is that the bar is so low in 2017 for people to avoid the penalty. We anticipate that the budget neutral piece of the pie is going to be relatively small. If we want to guarantee ourselves some type of bonus, we think we need to shoot for that larger pot,” Theine said.
By hitting the ground running, Theine said when the program becomes more stringent in 2018 and cost comes into the equation of determining a bonus or penalty for a clinic, those who are well positioned for success in 2017 will be able to continue their success in 2018 and be in line for a larger bonus.
“There are a lot of practices that may have a wait-and-see approach, that say this is all going to change with the changing of administration in Washington, D.C. Who knows what it will look like in 2018 and maybe it will be easy to avoid a penalty in 2018? We’re so close to doing well now, we’re going all in on 2017. If in 2018 things don’t change very much, there will be a lot of practices that may fail. We will probably be well positioned for a larger bonus in 2018-2019 when the percentage gets bigger and other practices may not do as well in their reporting through MIPS,” he said.
Do not expect changes
The new rules have support in Washington, D.C., from both parties in Congress. They will be in play in 2017, and physicians need to welcome them into their practices and change their mindset because the rules are not likely to be changed soon, Theine said.
“It’s important to have physicians buy in to do this. [Physicians] recognize that their compensation and the perception of them as physicians and surgeons, of their practices and businesses, are going to be determined in some way, shape or form by the quality data out there. They don’t like that, quite frankly,” Theine said.
However, it is not about whether physicians like the rules or not, according to Theine; rather, physicians recognize that to succeed in this environment, they need to acknowledge and address the new rules. – by Robert Linnehan
- References:
- Final MACRA rule released by CMS. http://ascrs.informz.net/informzdataservice/onlineversion/ind/bWFpbGluZ2luc3RhbmNlaWQ9NTk4MzUyOCZzdWJzY3JpYmVyaWQ9MTA3NTcwMjQzMA. Published Oct. 14, 2016. Accessed Nov. 22, 2016.
- Nation’s eye physicians and surgeons prepare for transition to new Medicare physician system. https://www.aao.org/newsroom/news-releases/detail/nation-s-eye-physicians-surgeons-prepare-transitio. Published Oct. 14, 2016. Accessed Nov. 22, 2016.
- Quality Payment Program. Modernizing Medicare to provide better care and smarter spending for a healthier America. https://qpp.cms.gov/. Accessed Nov 21, 2016.
- For more information:
- David R. Hardten, MD, FACS, can be reached at Minnesota Eye Consultants, 10709 Wayzata Blvd., Minnetonka, MN 55305; email: drhardten@mneye.com.
- Paul M. Larson, MBA, MMSc, COMT, COE, CPC, CPMA, can be reached at Corcoran Consulting Group, 560 E. Hospitality Lane, Suite 360, San Bernardino, CA 92408; email: plarson@corcoranccg.com.
- Nancey K. McCann can be reached at American Society of Cataract and Refractive Surgery, 4000 Legato Road, Suite 700, Fairfax, VA 22033; email: nmccann@ascrs.org.
- Michael X. Repka, MD, MBA, can be reached at Johns Hopkins Wilmer Eye Institute, 600 N. Wolfe St., Baltimore, MD 21287; email: mrepka@jhmi.edu.
- Joe Theine can be reached at Four Corners Eye Clinic, 575 Rivergate Lane, Suite 212, Durango, CO 81301; email: jtheine@fourcornerseye.com.
Disclosures: Hardten, Larson, McCann, Repka and Theine report no relevant financial disclosures.
Click here to read the 
, "What measures are you taking to prepare for MIPS?"