On March 26, 2015, Congress passed the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). This bipartisan bill accomplished several things, most notably repealing the sustainable growth rate formula methodology for updating the Medicare physician fee schedule (MPFS) and replacing it with new payment systems that incentivize care value or volume.
Prior to this legislation, physicians were looking at a 21.2 percent reduction to their Medicare payments. MACRA froze payment rates at their current levels for three months and provided a 0.5 percent increase for the last six months of 2015. MACRA also provides a payment rate increase of 0.5 percent each year through 2016-2019, and a fixed rate at the 2019 level through 2025.
Beginning in 2019, the amounts paid to “eligible clinicians” will be subject to adjustments through one of the two new payment systems:
- Advanced Alternative Payment Models (Advanced APMs)
- Merit-based Incentive Payment System (MIPS)
Note: The Centers for Medicare & Medicaid Services (CMS) later defines “eligible clinician” in a final rule (CMS-5517-FC).
APMs are developed in partnership with the clinician community to provide added incentives for clinicians to deliver high-quality and cost–efficient care. APMs can apply to a specific clinical condition, a care episode, or a population. The concept of the APM is not new, but MACRA provides added payment incentives to encourage participation.
MIPS is another new incentive payment system that focuses on the quality and cost of healthcare. It also consolidates components of the Physician Quality Reporting System (PQRS), value-based modifier (VM), and Medicare Electronic Health Record (EHR) Incentive Program (these programs will officially sunset Dec. 31, 2018). Beginning in 2019, MIPS will provide positive, neutral, or negative payment adjustments to eligible clinicians based on performance (2017 performance will determine 2019 adjustments, as so on).
In accordance with MACRA, CMS created the Quality Payment Program, in which to house the two new payment systems, and finalized more specific guidelines for managing the payment systems on Oct. 14, 2016 (CMS-5517-FC).
The volume-to-value movement will take years to fulfill, requiring practices to remain current on developments and deadlines. As the implementation of the Quality Payment Program unfolds, consult AAPC Deep Dives on MACRA and the Quality Payment Program for the latest news, assessments, and strategies for success.