The “Medicare Access and CHIP Reauthorization Act of 2015” or “MACRA,” was signed into law on April 16, 2015. The legislation replaces the current Medicare reimbursement schedule which is based on a fee-for-service model with a new pay-for-performance program that is focused on quality, value, and accountability. According to The Centers for Medicare and Medicaid Services (CMS), MACRA will implement a new payment structure that rewards health care providers for delivering better care instead of more service. MACRA makes three key changes to Medicare payment:
o Merit-based Incentive Payment System (MIPS), and
o Alternative Payment Models (APMs)
o Physician Quality Reporting System (PQRS)
o Value-based Payment Modifier (VBPM)
o Meaningful use (MU)
o Clinical practice improvement activities (CPIA)
MIPS and APMs will go into effect from 2015 through 2021 and beyond.
The Merit-Based Incentive Payment System (MIPS) is a new program that determines Medicare payment adjustments. It combines parts of the Physician Quality Reporting System (PQRS), the Value Modifier (VM or Value-based Payment Modifier), and the Medicare Electronic Health Record (EHR) incentive program into one single program in which Eligible Professionals (EPs) will be measured on. Contingent on a performance score, eligible professionals (EPs) may receive a payment bonus, a payment penalty, or no payment adjustment. The Composite Performance Score is comprised of the following four categories:
o Quality (PQRS/VM) (50%)
o Resource use (10%)
o Clinical practice improvement activities (15%)
o Meaningful use of certified electronic health records (EHR) technology (25%)
Performance will be measured in these categories to obtain a “MIPS score” (0 to 100). The MIPS score can impact a provider’s Medicare reimbursement in each payment year from -9% to +27% by 2022.
MACRA defines any of the following as an Alternative Payment Model (APM):
o An innovative payment model expanded under the Center for Medicare & Medicaid Innovation (CMMI), with the exception of Health Care Innovation Award recipients;
o A Medicare Shared Savings Program (MSSP) accountable care organization (ACO);
o Medicare Health Care Quality Demonstration Program or Medicare Acute Care Episode Demonstration Program; or
o Another demonstration program required by federal law.
For a provider to receive enhanced payment through a qualified APM, the APM must also meet the following requirements:
o Use of quality measures comparable to measures under MIPS;
o Use of a certified electronic health record (EHR) technology; and
o Assumes more than a “nominal financial risk” (which is undefined), OR is a medical home expanded under the CMMI.
o A physician receiving the designated percentage of Medicare payments or patients through a qualified, eligible APM based on the above requirements is considered a “qualifying participant” (QP).
Most physicians will utilize MIPS until more qualified, eligible APMs become available. However, physicians are able to switch payment models annually. According to the AAFP physicians interested in an APM model need to be prepared to start in the MIPS program.