Published 12/1/2016
Elizabeth Fassbender; Shreyasi Deb

CMS Releases MACRA/Quality Payment Program Final Rule

On Friday, Oct. 14, the U.S. Centers for Medicare & Medicaid Services (CMS) released the final rule for the Medicare Quality Payment Program, which implements the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and replaces the sustainable growth rate formula. The Quality Payment Program has two tracks for payment: the Merit-based Incentive Payment System (MIPS) and the Advanced Alternative Payment Models (APMs) (Fig. 1). Because CMS expects the Quality Payment Program to evolve over multiple years, the final announcement included an additional 60-day comment period to "continue to solicit input from clinicians, patients, and others."

"The policy released today is the first step in a multiyear journey in which we are particularly focused on allowing clinicians to transition at their own pace, continuing to get feedback from the field, providing meaningful support, and improving the program over time," wrote CMS Acting Administrator Andy Slavitt. "We are committed to paying close attention to the impact of our policies on care delivery and adjusting along the way. By working together, we can all make real progress in improving the delivery of care in our country."

In the final rule, CMS recognized that many eligible clinicians will face challenges preparing for participation in the MACRA Quality Payment Program during 2017. With that in mind, the agency is treating 2017 and 2018 as transition years, during which both clinicians and CMS will build reporting capabilities and gain experience with the program. The thresholds and other requirements for 2018 will be announced through rulemaking in 2017.

Participation options
In 2017, clinicians can choose a course of participation from the following four options:

  1. Participate for the full calendar year: To maximize the chance of qualifying for a positive adjustment, MIPS-eligible clinicians can choose to report for a full 90-day period or the full year. MIPS-eligible clinicians who are exceptional performers in the program, as shown by the practice information that they submit, will also be eligible for an additional positive adjustment for each year of the first 6 years of the program.
  2. Participate for part of the calendar year: Clinicians can choose to report to MIPS for less than the 2017 full year performance period. To avoid a penalty, clinicians must report for at least a full 90-day period and must report more than one quality measure, more than one improvement activity, or more than the required measures in the advancing care information performance category. Doing so could result in possibly receiving a positive MIPS payment adjustment.
  3. Test the Quality Payment Program: Clinicians can choose to report one measure in the quality performance category, one activity in the improvement activities performance category, or the required measures of the advancing care information performance category and avoid an MIPS penalty.
  4. Participate in an Advanced APM: MIPS-eligible clinicians can participate in Advanced APMs; those who receive a sufficient portion of their Medicare payments or see a sufficient portion of their Medicare patients through the Advanced APM will qualify for a 5 percent bonus incentive payment in 2019. Qualifying APM participant determinations are made at the APM entity level; an exception are the gain sharers in the Comprehensive Care for Joint Replacement (CJR) model, who will be assessed individually. CJR is anticipated to be an Advanced APM in 2018 (ie, in the 2020 performance year).

Importantly, MIPS-eligible clinicians who choose not to report even one 2017 measure or activity will receive the full 4 percent penalty in 2019. Additionally, CMS has highlighted that although flexibilities have been included to encourage participation, the largest MIPS bonuses will come through submitting information in all the MIPS performance categories.

For example, under the quality performance category, participants focused on musculoskeletal care must report six measures (one of which must be a high-priority measure because validated outcome measures do not exist) or select a specialty-specific set of measures for a minimum 90-day continuous performance period to receive the full score in this category. Interested readers should consult Table A in the Appendix of the MACRA/QPP Final Rule for a complete list of Finalized Individual Quality Measures Available for MIPS Reporting in 2017; the list of specialty-specific measure sets can be found in Table E.

This change was finalized after intense pressure from numerous physician groups—including the American Association of Orthopaedic Surgeons (AAOS). In its comment letter to CMS, AAOS explained that it would be "burdensome, if not impossible, for physicians to get ready for the first performance year of 2017" and that "physicians who find this time frame too difficult to comply with may not participate in the MIPS program at all."

Impact on small practices
One important change from the proposed rule is that CMS expects more small practices to be excluded from MIPS reporting requirements due to the low-volume threshold ($30,000 or less in Medicare Part B allowed charges OR 100 or fewer Medicare patients). This change in low-volume threshold was made in response to stakeholder comments. (The proposed rule initially called for a threshold of $10,000 in annual Medicare revenue AND fewer than 100 Medicare patients.)

In addition, $100 million in technical assistance will be available to MIPS-eligible clinicians in small practices (15 clinicians or less), in rural areas, and in practices located in areas with a shortage of health professionals.

"We know that small practices deliver the same high-quality care as larger ones," Mr. Slavitt wrote. "Yet at every practice we visited or event we held, we heard from physicians in small and rural practices concerned about the impact of new requirements. We heard these concerns and are taking additional steps to aid small practices. … Due to these changes, we estimate that small practices will have the same level of participation as other practice sizes."

To further support physicians, an Oct. 13, 2016 CMS press release announced an outreach effort to individual clinicians to help them prepare for the Quality Payment Program and improve the clinician experience with Medicare. Over the next 6 months, each of the 10 CMS regional offices will oversee local meetings to take input from physician practices; regular meetings will be held thereafter. These local meetings will result in a report to the CMS Administrator in 2017.

The agency is also working with the U.S. Government Accountability Office on a report to Congress, on whether entities such as independent risk managers, which pool financial risk for physician practices, can play a role in supporting these small practices. The report is due Jan. 1, 2017.

The final rule also sets a sunset date of 2018 for payment adjustments under the current Medicare Electronic Health Records Incentive Program, the Physician Quality Reporting System, and the Value Modifier program. Components of those programs will be carried forward into MIPS.

Advanced APMs
With regard to the Advanced APM track, AAOS continues to work with CMS to ensure that bundled payment models, including the CJR and the surgical hip/femur fracture treatment (SHFFT) models, have the option to qualify as Advanced APMs. Both the CJR and the SHFFT models are anticipated to be Advanced APMs starting in 2018.

"Reducing the administrative burden on clinicians and increasing flexibility in reporting requirements and eligibility rules are important," stated AAOS President Gerald R. Williams Jr, MD. "Although AAOS is strongly opposed to mandatory participation in bundled payment models, it is also important to quickly finalize the CJR, SHFFT, and Bundled Payments for Care Improvement Advanced APM design parameters. We will continue to work closely with CMS to ensure physician payment reform ultimately improves the care of musculoskeletal patients."

In June 2016, AAOS submitted comments to CMS outlining several areas of concern with the proposed rule, including the implementation timeline, restrictive requirements for Advanced APMs, and the impact on smaller or solo practices. Although it appears that CMS is responding to some of these concerns—especially on flexibility in reporting requirements in 2017, physician engagement, and support for small practices—AAOS leadership and staff are closely reviewing the final rule and will provide additional comments by the Dec. 19, 2016 deadline.

AAOS members can find up-to-date information from CMS at https://qpp.cms.gov/ and from AAOS at www.aaos.org/macra; questions, concerns, or comments can be emailed to macra@aaos.org

Elizabeth Fassbender is the communications manager and Shreyasi Deb is the senior manager, health policy, in the AAOS office of government relations.

Additional Information:
CMS Final Rule