August 2, 2016

MACRA, MIPS, and RHC: How Quality-Based Payments Will Affect Health Care Reimbursement

To replace the repealed sustainable growth rate payment methodology, CMS has proposed a new quality-based payment structure called MACRA, the Medicare Access and CHIP Reauthorization Act of 2015. MACRA will take effect in 2019 based on quality data from calendar year 2017, just a few months away. It replaces other quality and reporting programs such as Physician Quality Reporting System, Value-Based Modifier, and Meaningful Use. The proposed rule was released this spring with the final rule expected in the fall.

How MACRA Affects Clinicians

MACRA payments follow one of two models. Most clinicians (MD, DO, PA, NP, CNS, CRNA) would fall under the Merit-based Incentive Payment System (MIPS), while a small minority will be on the Advanced Alternative Payment Model (APM), such as a qualified ACO.

MIPS reimbursement changes include up to a 4% downward payment adjustment or a 4% enhanced payment based on the composite score of the clinician.  The payment adjustments increase yearly reaching 9% in 2022. Since the program is budget neutral, clinicians will be scored and essentially competing to produce quality results in the top half of peers to avoid payment penalties received by those with lower scores.

MACRA and Rural Health Clinic Reimbursements

RHC reimbursement methodology is NOT applicable to the impacts of MACRA at this time.  If a practitioner or group within the RHC also has Part B Physician Fee-For-Service (FFS) reimbursement, MIPS may apply to the Physician FFS.  Clinicians operating solely within RHC all-inclusive rate methodology won’t be impacted by MACRA in 2019.  But, be warned with the focus towards quality and improved outcomes, RHCs won’t dodge these type of mandates forever.  Commercial insurance may follow CMS’ lead. This is an opportunity to focus on quality measures and patient engagement if it isn’t already common practice.

CMS Update

Most recently, CMS Acting Administrator, Andy Slavitt, has testified before the Senate Committee on Finance and acknowledged having a start date of January 1, 2017 when the final rule will not be provided until the fall is a “legitimate concern,” for the clinicians and the comments received on the proposed rule are being considered. More information will be shared as it unfolds.  For help analyzing the impact and preparing your organization for success under MACRA contact the Anders Health Care Group.

Key Acronyms
CMS – Centers for Medicare & Medicaid
MACRA – Medicare Access and CHIP Reauthorization Act of 2015
MIPS – Merit-based Incentive Payment System
APM – Alternative Payment Model
ACO – Affordable Care Organization
RHC – Rural Health Clinic
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