In the proposed Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) rule released by the federal government this week, one of the big takeaways was that Congress would streamline various quality reporting programs into a single framework to help eligible Medicare physicians transition from payments based on volume to payments based on value.
As such, the MACRA proposed rule would implement these changes through the unified framework called the Quality Payment Program, which includes two paths: the Merit-based Incentive Payment System (MIPS) and advanced alternative payment models (APMs). Most Medicare clinicians will initially participate in the Quality Payment Program through MIPS, though they won’t be locked into one path or the other in subsequent years; they can switch annually, officials of the Centers for Medicare & Medicaid Services (CMS) said with the announcement of the rule on April 27.
While MIPS allows Medicare clinicians to be paid for providing high value care through success in four performance categories—Quality, Advancing Care Information (the “new” meaningful use), Clinical Practice Improvement Activities, and Cost—advanced APMs include payment models such as accountable care organizations (ACOs) and patient-centered medical homes (PCMHs). Medicare clinicians who participate to a sufficient extent in advanced APMs would be exempt from MIPS reporting requirements and qualify for financial bonuses.
Following the release of the rule, the Charlotte, N.C.-based Premier Inc. gave a statement expressing disappointment that CMS did not include any bundled payment models or Track 1 Medicare Shared Savings Program (MSSP) ACOs as qualifying advanced payment programs under MACRA. In the statement, the organization took issue with CMS not counting these payment models as taking more than “nominal risk” financial requirement. Indeed, under Track 1, CMS and the participating ACO will reconcile savings and allow the ACO to share in those savings without the risk of the ACO sharing in any losses. In other words, this single-sided model only has upside—no downside for the ACO.
In an exclusive interview with Healthcare Informatics, Blair Childs, senior vice president, public policy for Premier, says he hopes CMS will rethink the proposed rule in terms of who they will recognize as qualified APMs. “We believe that Track 1 ACOs should be let in and should qualify. The idea of MACRA is to incentivize providers to move them away from fee-for-service (FFS) models, but with Track 1 ACOs, our members make significant investments to do just that. That’s more than nominal risk,” Childs attests.
Blair Childs
Childs notes that CMS’ logic is that the agency choses to define risk as only cases where there is risk to the government. “It’s reducing the risk for the government but not necessarily for the provider,” he says. “Because the provider has to pay back Medicare, that’s how they are defining nominal risk. Our point is that from the vantage point of a provider, you’re making significant financial decisions from a risk vantage point, and that should be calculated in this as well. That’s a difference of perspective there.”
Childs says that Premier will push for this change, and will keep on making the case for Track 1 ACOs to qualify as advanced APMs throughout the rule’s 60-day comment period. He shows hope that CMS has left the door open for bundled payment models to qualify. “I will say that when a provider is at two-sided risk with CMS, there is a level of focus and performance that we see as even more robust than under the Track 1 model. That doesn’t mean that you shouldn’t allow Track 1 to qualify, though,” he says.
A Push Towards APMs?
Most healthcare policy folks attest to the fact that the idea behind MACRA’s Quality Payment Program is to incentivize providers to be associated with an advanced APM and be eligible for the payment bonuses that come with it. To this point, Jeffery Smith, vice president, public policy, at the American Medical Informatics Association (AMIA) says, “That’s where the slant of the table is pointing. He says, “In terms of MIPS, what CMS has done, they have tried to accommodate Congressional intent, which was that not everyone will be eligible or want to be part of an APM. So they created MIPS, but it’s being constructed in a way that makes APMs less daunting of an alternative option. That’s been the unstated intent all along,” Smith says.
Childs himself does acknowledge that the intent of Congress was pretty clear to have Medicare physicians move towards APMs, as a 5 percent bonus is put on their payments in this track. But, he says, “CMS is not following that intent of Congress, which is to try to accelerate the movement in this direction, towards APMs, where providers are accountable for the cost and quality of care. It’s preposterous that we have a healthcare system today where that doesn’t exist. The entire healthcare system is built on the Medicare payment model which is based on a fee-for-service system, and that’s why providers are not at risk right now.” He continues, “Congress has sent a clear message with MACRA, on a bipartisan basis, to move away from this open-ended fee-for-service system to where providers are accountable. But CMS is interpreting it in a much more narrow way which undermines the intent of Congress.”
Arien Malec, vice president of data platform and acquisition tools for RelayHealth (the Alpharetta, Ga.-based McKesson business unit that focuses on improving clinical connectivity) and former staffer at the Office of the National Coordinator (ONC), agrees that while the payment adjustments for Medicare providers are generous in this APM track, he expected “a better glide path towards this track.” With that said, Malec thinks that CMS did show more flexibility for designing the qualification rules. The agency went with a two-track model, with one being a medical home track for physician groups that are fewer than 50 in size, and that medical home model requires a revenue-based model, so there is some risk on revenue he explains.
Arien Malec
The alternative approach for a “classic” APM requires a really significant-expense based risk, Malec notes, offering the example of an ACO that is caring for 1,000 Medicare beneficiaries with a benchmark cost that adds up to $1 million (These are not realistic numbers; Malec just used round figures to make it easier to explain). The way the APM track is calculated, if the ACO goes over the cost target of $1 million for those 1,000 beneficiaries, it has to be at risk for at least 30 percent of the overage, while the organization’s risk has to be no less than 4 percent, Malec says.
“Any reasonable size ACO will have a significant monetary risk on that calculation,” he says. “The net of it is that there is wide gulf between the medical home model, which is fairly attractive on the looks of it, and any two-sided ACO or bundled model, where you have a significant amount of risk. I was surprised that there wasn’t a Goldilocks solution of a risk model that wasn’t so hefty that would qualify you for the APM track. I expect that to be part of the commentary that CMS gets,” Malec says.
What’s more, Malec notes that CMS hasn’t even fully published the list of APMs that are APM-track eligible, and as a result, providers are put in a strange position. “Even those providers who want to go into an APM are left scratching their heads,” Malec says. “What do I do? What are the final qualifications for that track? I expect CMS will take comments and take measures to make this flexible given the tight timeframe between final rule and start of the performance year,” he predicts.
Childs isn’t as worried about the tight timeframe for Premier’s members, as he feels as they have gotten the necessary education to prepare. But he says that the average clinician in this country “doesn’t have a clue about how this [system] works, what the details are, when the timeline starts, and what they will be measured on.”
He adds, “I think this is complicated and even though they have simplified it, most clinicians don’t understand anything about the APMs or qualifications or bonuses. We believe that the only way you will fix healthcare in this country is that it needs to be a provider-led transformation working with patients in the community. That is where change will occur; it cannot be a payer-driven change.”
