MACRA & MIPS Explained

by  James Goosie, MBA
Jul 22nd, 2016 - Reviewed/Updated Aug 17th

You may have already heard that on April 16, 2015, the bipartisan legislation signed into law the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). MACRA was created to repeal the sustainable growth formula, change the way physicians are paid by going to a value- based system instead of a volume system, streamline programs under the new Merit Based Incentive Payment System (MIPS), and provide bonus payments to physicians who participate in eligible alternative payment models (APMs).

But what does this all mean? The final rule for MACRA has not yet been approved, but here is what we know now:

Through MACRA, HHS is going to offer multiple pathways with different risk levels and rewards for providers in order to tie in more payments to the value of the visit rather than the quantity. Over a period of time, MACRA is going to allow more providers to participate in APMs and minimize additional reporting burdens for APMs participants. In layman's terms, this means it will allow insurance carriers to see a larger picture of how a provider practices medicine, which will most likely open the door for more audits and more scrutiny on how providers practice medicine - or how the insurance company tells the provider to practice medicine in the world of managed care. MACRA will also be used to support and develop APMs for Medicaid, Medicare Advantage, and other payer arrangements.

Under MIPS, physicians and practitioners will be scored on four main categories: quality, resource use, clinical practice improvement activities, and meaningful use of a certified EHR technology. In the first two years, MIPS will only impact physicians, PAs, NPs, Clinical Nurse Specialists, and Certified Registered Nurse Anesthetists. After three years, the Secretary may broaden the eligibility for MIPS to Physical or Occupational Therapists, Speech-Language Pathologists, Audiologists, Nurse Midwives, Clinical Social Workers, Clinical Psychologists, and Dietitians/Nutritional Professionals. The first MIPS reporting period will be 2017. Here is a breakdown of the four categories and a brief description of exactly what CMS is looking for:

• Quality: The quality category accounts for 50 percent of the MIPS score in the first year. For this category, clinicians would choose six measures to report (versus the nine measures currently required under the Physician Quality Reporting System). In addition, for individual clinicians and small groups (2-9 clinicians), MIPS calculates two population measures based on claims data, meaning there are no additional reporting requirements for clinicians for population measures. For groups with 10 or more clinicians, MIPS calculates three population measures. The measures would each be worth up to ten points, for a total of 80 to 90 possible points depending on group size. The proposal strives to align with the private sector and reduce the reporting burden by including the core quality measures that private payers already use for their clinicians. When choosing the six quality measures, clinicians would choose one cross-cutting measure and one outcome measure (if applicable) or another high quality measure. High quality measures are measures related to patient outcomes, appropriate use, patient safety, efficiency, patient experience, or care coordination. There will be more than 200 measures to pick from, and more than 80 percent of the quality measures proposed are tailored for specialists.

• Advancing Care Information Clinicians: will report key measures of interoperability and information exchange. Clinicians will be rewarded for their performance on measures that matter most to the physician. Advancing care information will be scored off of six measures: protect patient health, patient electronic access, coordination of care through patient engagement, electronic prescribing, health information exchange, and public health and clinic data registry reporting. Physicians are eligible for 100 points for this category and this category represents 25 percent of the overall MIPS score.

• Clinical Practice Improvement Activities: Clinicians can choose the activities best suited for their practice. The rule proposes over 90 activities from which to choose. These activities include: expanded practice access, population management, care coordination, beneficiary engagement, safety, practice assessments, and participation in an alternative payment program. Clinicians participating in medical home health will receive full credit in this category and those participating in APMs will earn a minimum of half the credit (30 points). Clinicians can receive a maximum of 60 points for this category which represents 15 percent of the overall MIPS score.

• Resource Used: CMS will calculate these measures based on claims and availability of sufficient volume. Clinicians do not need to report anything. This category is 10 percent of the MIPS score and the total point is the average score of all resources measured by CMS.

CMS also included one bonus point for physicians who report immunizations to the health registry. With that being said, physicians will face either a positive adjustment or a negative adjustment based on the qualifiers listed above. In 2018, physicians could receive a maximum of a 4% decrease in payment if their MIPS score is below 25% or a 4% increase in payment. These maximum percentages will continue to increase each year. By 2022, clinicians will be facing either a 9% increase or a 9% decrease in payment. Who is immune from MIPS? CMS has stated that hospitals, facilities, and clinicians who qualify for the bonus payment or are below the low volume threshold are eligible for alternative payment models. Everyone else will be required to participate in MIPS.

Alternative payment models, according to the MACRA law, include the following: CMS innovation center model (other than Health Care Innovation Award), MSSP (Medicare Shared Savings Program), demonstration (under the Health Care Quality Demonstration Program), and demonstration required by Federal law. MACRA will not change the reward values in APMs and APM participants who are not "QPs" (physicians and practitioners who have a certain percentage of their patients or payments through an eligible APM) will receive favorable scoring under the MIPS clinical practice improvement activities performance category. Participants that are in the most advanced APMs may be determined to be qualifying APM participants, and as a result, are not subject to MIPS. These participants will receive a 5% lump sum bonus payment for years 2019-2024 and will then receive a higher fee schedule update for 2026 and onward. Although the final rule for MACRA has not yet been approved by CMS, it's important to be as educated as you can on the proposed ruling.