As HCI Managing Editor Rajiv Leventhal reported on Thursday afternoon, Andy Slavitt, Acting Administrator of the federal Centers for Medicare & Medicaid Services (CMS), announced yesterday that, on the one hand, there will be no delay in the January 1, 2017 start date for the implementation of the provisions of the Medicare Access and CHIP Reauthorization Act (MACRA); but that, at the same time, CMS was providing physicians in practice with a range of options for complying with MACRA’s provisions.
In the announcement, in the form of a blog on the agency’s website, Slavitt wrote that, during 2017, “eligible physicians and other clinicians will have multiple options for participation. Choosing one of these options would ensure you do not receive a negative payment adjustment in 2019. These options and other supporting details will be described fully in the final rule.” Slavitt said the final rule will be published before November 1. This summer, Slavitt had himself left open the possibility that the sweeping changes set to overhaul physician payment as the healthcare industry shifts to paying doctors for value rather than volume, could be pushed back from the intended start date of Jan. 1.
But that was not to be. Now, instead, as Slavitt laid out for providers in his blogpost, Medicare-participating physicians in the U.S. will have four options:
Ø The first option is to “test” the Quality Payment Program, which includes two paths—the Merit-Based Incentive Payment System (MIPS) and Alternative Payment Models (APMs). Under this first option, as long as physicians “submit some data to the Quality Payment Program, including data from after Jan. 1, 2017,” they will avoid a negative payment adjustment.” The idea of this option is to ensure that systems are working and that providers are prepared for broader participation in 2018 and 2019 as knowledge is gained.
Ø The second option is to choose to submit Quality Payment Program information for a reduced number of days. This means that the first performance period could begin later than Jan. 1, 2017 and the physician’s practice could still qualify for a small positive payment adjustment. Slavitt writes, “For example, if you submit information for part of the calendar year for quality measures, how your practice uses technology, and what improvement activities your practice is undertaking, you could qualify for a small positive payment adjustment. You could select from the list of quality measures and improvement activities available under the Quality Payment Program.”
Ø The third option is to participate for the full calendar year in 2017. This choice is for practices that are ready to go. CMS said that it has “seen physician practices of all sizes successfully submit a full year’s quality data, and expect many will be ready to do so.”
Ø The fourth option is to participate in an Advanced Alternative Payment Model in 2017. Examples of this include Medicare Shared Savings Track 2 or 3 in 2017. Slavitt writes, “If you receive enough of your Medicare payments or see enough of your Medicare patients through the Advanced Alternative Payment Model in 2017, then you would qualify for a 5 percent incentive payment in 2019.” It should be noted that most policy experts predict eligible physicians to initially pursue MIPS because an APM that qualifies under MACRA will bring with it a significant amount of risk.
So, what does all of this mean?
I would submit that this is a very careful “threading of the needle,” if you will, creating a workable compromise between on the one hand, maintaining rigor in the process of the shift to MACRA-driven changes in physician reimbursement, while on the other hand, giving physicians what most would considerable a reasonable amount of flexibility with which to comply. Many in the provider world will doubtless be shocked that CMS has pushed back hard in not extending the start date for all this activity into mid-2017, as many industry observers had predicted the agency would do.
But those who are most shocked should also consider how much is at stake, on a policy level, in delaying the start of all this much longer, particularly at a time of political uncertainty on Capitol Hill. With Medicare’s actuaries predicting a snowballing of U.S. healthcare spending over the next decade, it would be hard to deny on the broadest policy level the idea that MACRA needs to move forward quickly. As I noted in a blog in July, following the release that month of the Medicare actuaries’ total U.S. healthcare spending projections, the U.S. healthcare system is set to go over a truly enormous cost cliff, with total spending expected to go from $3.3013 trillion, and 17.5 percent of our country’s gross domestic product, in 2014, to $5.631 trillion, and fully 20.1 percent of our GDP, by 2025; in other words, a nearly 70-percent total increase in U.S. healthcare spending across just over a decade. And as I wrote in July, anyone who isn’t astonished by the $5.631 trillion number simply isn’t fully awake.
Keep in mind also that the Medicare actuaries’ projections were released on July 18, and this announcement has come out on September 8; in the context of the pace at which the cogs of federal government agencies’ wheels turn, yesterday’s announcement has come lightning-fast. As in, as relatively quickly as an Olympic runner moves.
As recently as this week, national physician organizations have been pleading with CMS officials to delay the implementation of the MACA requirements for physicians. Indeed, in an article written by Leigh Paige and published yesterday online in Medscape, Robert Wergin, M.D., chair of the American Academy of Family Physicians (AAFP), was quoted as saying, "We propose to delay the implementation at least until July, and better yet until 2018. That gives another 6 months for a practice to prepare for the final rule. Two months is not enough."
As the Medscape article noted, “The Medicare Access and CHIP Reauthorization Act (MACRA) is a complex law that will affect physicians in a wide variety of ways for many years to come. It covers such issues as data reporting, new practice models, evolving clinical standards, and physician evaluations, and it involves hundreds of millions of dollars in penalties and bonuses.” It went on to note that “The ultimate goal of MACRA is to entice clinicians to get into advanced APMs, where CMS will not need to supervise them as closely as MIPS physicians, because their organizations have assumed financial risk and will presumably manage cost like payers do.” Importantly, the article noted, any kind of participation in APMs “can be very risky if you don't have an infrastructure in place, including use of electronic medical records, generation of performance data, and staff who are coordinating care.”
At the same time, given the context of yesterday’s announcement, there was some sense of realism—perhaps inevitability, really—among national healthcare association leaders—at least among those who are leading the most progressive associations. For example, late Thursday afternoon, the Charlotte-based Premier Inc. released a statement attributed to Blair Child’s, the organization’s senior vice president of public affairs, which said, “We appreciate Centers for Medicare & Medicaid Services’ (CMS’s) communication on their measure reporting approach for 2017 prior to an official final rule. While we await the details of the measures and requirements,” Childs said, “this provides direction to practices that they should prepare now to report and succeed under the Quality Payment Program. We believe it is well within the abilities of most eligible clinicians to successfully submit their quality performance measures. Similar to the measures reporting, we hope that CMS will also listen to the overwhelming comments submitted from across the industry calling for them to reduce the risk levels for Advanced Alternative Payment Models and take steps to create additional ACO tracks to provide additional opportunities for eligible clinicians to obtain the 5 percent incentive payment.”
Meanwhile, CAPG, the Los Angeles-based association whose tagline is “The Voice of Accountable Physician Groups,” went further, expressing strong enthusiasm for CMS’s move. In a press release, CAPG quoted its president and CEO Donald Crane as saying that "We are pleased that the agency has taken into account the feedback of physician groups who are ready to go with MACRA implementation in January. CAPG has been calling on CMS to allow physician practices to begin MACRA performance in January 2017 as originally scheduled. This will ensure that the landmark law’s momentum, which began by passing the Congress with wide-sweeping bipartisan support, continues to carry weight in the right direction – toward implementation.”
In addition, Crane said in the CAPG statement, “We … appreciate CMS taking this step to provide additional clarity to the physician community as we await the final rule.” And he added that, “As CMS considers additional flexibility for physicians and physician groups in support of the law, CAPG urges the agency to consider a solution that would allow more physicians to qualify as advanced alternative payment models (APMs) based on all of their Medicare risk contracting, both in Medicare Advantage and Medicare Part B. Making MACRA work for physicians and patients requires equal treatment of alternative payment arrangements across the entire Medicare payment system, not just traditional Medicare.”
In any case, the key two questions now are: how ready are physicians and physician groups to take the next steps they will be required to take? And what steps—that is to say, which options—will they end up taking? Many of us have seen the rather astonishing results of surveys that even this spring found that around half of practicing physicians in the U.S. had not yet even heard of MACRA, nor did they understand what it was or what it meant. To say that, collectively speaking, U.S. physicians have been unprepared for this massive shift in federal payment, is to make a huge understatement.
But, given that this is now happening, and that the MACRA provisions—short of some kind of last-minute policy deus ex machina, will be happening—physicians will need to move quickly in the next few months. And physician group leaders will be under tremendous pressure to figure things out quite rapidly. And IT leaders in physician organizations are going to be swamped by demands and needs for technology solutions, analytics activity, and endless amounts of support, as doctors prepare to be plunged headlong into the value-based purchasing world. CMS officials anticipate that as many as four-fifths of Medicare-participating physicians will begin in the MIPS program rather than leaping directly into alternative payment models. But MIPS itself will be hugely demanding of them in terms of its reporting requirements and value-based incentives. And even deciding which of the official options to pursue, which surely prove to be a challenge for many.
So the race is now officially on for Medicare-participating physicians to prepare for the new system (or, systems, to be precisely accurate). And physicians in practice will need a tremendous amount of support from their administrative leaders and from their IT leader colleagues, in the coming months (and years, to be honest).
One thing is certain in all this: solo medical practice, and practice in so-called “onesie-twosie” practices of a couple of or a few physicians, is about to become far less sustainable for most practicing physicians. The demands of the new payment systems are simply going to be far too overwhelming, in terms of how doctors will need to collect and report clinical and financial outcomes, as well as in terms of the continuous clinical performance improvement that will now be required.
So with this announcement yesterday, we’ve officially entered a new world. And it will inevitably be one filled with both opportunities and challenges. And just wait until the majority of commercial insurers quickly develop Medicare’s payment systems. So yes—the train has indeed left the station. Time to buckle up for the ride ahead!
