Several months into 2017, physicians around the country are preparing for the first benchmark year of MACRA, the Medicare Access and CHIP Reauthorization Act. Passed in 2015, MACRA is the bipartisan health care law responsible for eliminating the Sustainable Growth Rate and it promises to continue to fundamentally alter the way providers are paid. This year determines reimbursement in 2019.
Under the law, physicians must report performance under one of two pathways: MIPS, the Merit-based Incentive Payment System, or participation in a qualified Advanced Alternative Payment Model, or Advanced APM. The first, MIPS, replaces the Physician Quality Reporting System, Meaningful Use and the Physician Value-Based Payment Modifier and is the track most providers can expect to follow, at least initially, because most will not meet the requirements for Advanced APMs.1,2
This is especially true for hospitalists, most of whom are not yet participating in qualifying alternative payment models.2
The MIPS track is budget neutral, which means for every physician or physician group that receives a boost in reimbursement, another will receive a cut. Others will receive a neutral adjustment. All physicians see an annual 0.5% increase in payment between 2016 and 2019 and MIPS clinicians receive a 0.25% annual boost starting in 2026. Providers participating in Advanced APMs will also receive an annual 5% payment bonus between 2019 and 2024, and a 0.75% annual increase in payments beginning in 2026.1
Both pathways are complex and will affect different clinicians in unique ways, particularly hospitalists.
“A large percentage of hospitalists are actually employed… and the question is whether there is a change in their compensation structure as a result of a negative score,” said Kavita Patel, MD, a practicing internist and nonresident fellow of the Brookings Institution. “That’s why MACRA is complicated: It’s not just that hospitalists are different, it’s that they’re compensated differently as well.”
Some health policy experts, like Robert Berenson, MD, FACP, Institute Fellow of the Health Policy Center at the Urban Institute, say MACRA could actually drive more hospitalists into employment to avoid the costs associated with complying with the law.
Regardless, there is much about MACRA that hospitalists should familiarize themselves with this year. The CMS has announced 2018 will also be a transition year and, as such, additional rules are forthcoming.
“It’s not an easy piece of legislation to understand and there are still areas that need to be clarified in the coming months,” said Nasim Afsarmanesh, MD, SFHM, a hospitalist and member of the Society for Hospital Medicine’s Public Policy Committee.
Here is what to know for now:
All providers who receive Medicare Physician Fee Schedule payments and do not participate in an Advanced APM will fall into MIPS, and reporting applies to all patients, not just Medicare beneficiaries.3 There are, however, exemptions: providers in their first year of Medicare, those billing Medicare Part B less than $30,000 annually, and those who see 100 or fewer Medicare patients.4
Under MIPS, physicians are scored on a scale of 1 to 100 based on performance across four weighted categories: Quality (60%), Advancing Care Information (25%), Improvement Activities (15%), and Cost (not included for 2017). Hospitalists who provide 75% or more of their services in hospital inpatient or outpatient settings, or in the emergency department, are exempt from Advancing Care Information, which replaced meaningful use. As a result, the Quality category will make up 85% of the overall score in 2017.
The CMS also announced added flexibility for 2017 with regard to reporting under MIPS, intended to give providers who need it extra time to prepare.5 Physicians and physician groups can report for a full year, starting January 1, 2017, or report for just 90 days, to be eligible for a positive payment adjustment. To avoid a negative adjustment, they can simply submit more than one quality measure, improvement activity, or advancing care information measure (for those not exempt). Or, providers can choose to report nothing and incur a negative 4% payment.
The approach to MIPS in 2017 will vary widely among SHM members, said Joshua Boswell, SHM’s director of government relations.
“Some are looking to do just the bare minimum, not because of their lack of readiness, but for at least this year, to avoid the time, resources, and cost associated with reporting.” he said. “Other groups are considering jumping in with both feet and fully reporting, their thinking being that they can’t lose, and if there is money on the table for high performers, they might as well go for it.”
For 2017, providers who score 70 or more points are eligible for a performance bonus, drawn from a $500 million pool set aside by CMS. The minimum point threshold defined by CMS is three, which a clinician can earn by submitting just one of the six required quality measures.4
The CMS has defined 271 total quality measures under MIPS, 13 of which are designated as hospitalist specialty measures. However, SHM believes just seven are applicable to hospitalists. Public Policy Committee chair and SHM president Ron Greeno, MD, MHM, says most clinicians will only be able to reliably report on four.
“We’re working to ensure the program is structured so that providers can confidently report on just the measures applicable to them, even if it’s fewer than six,” he said. To ensure physicians are not penalized or disadvantaged for being unable to report the required number of measures, Dr. Greeno said CMS is working to develop a validation test, though it has not yet released details.
The measures most applicable to hospitalists include two related to heart failure (ACE inhibitor/angiotensin receptor blocker for left ventricular systolic dysfunction [LVSD] and beta-blocker for LVSD), one stroke measure (DC on antithrombotic therapy), advance care planning, prevention of catheter-related bloodstream infection (central venous catheter insertion protocol), documentation of current medications and appropriate treatment of methicillin-resistant Staphylococcus aureus bacteremia.
“This isn’t one of those things that will impact everybody equally,” said Dr. Afsarmanesh. For example, most hospitalists should be able to easily report on advanced care planning and medication documentation, she said, but in some hospitals the stroke measures may be captured in the emergency department; many hospitalists may not achieve enough reportable stroke management cases.
However, Dr. Afsarmanesh expects hospitalists will shine in the improvement activities category. “It’s part of our DNA,” she said. “Improvement activities… have become part of the core responsibilities for many of us within hospitalist groups, hospitals, and health systems.”
In 2017, CMS requires providers to report four improvement activities, which include: implementation of antibiotic stewardship programs, connecting patients to community chronic-disease management programs, and integrating pharmacists into a patient care team. Dr. Afsarmanesh suggests hospitalists visit SHM’s Quality and Innovation guide for ideas, implementation toolkits, and more.
In the cost category, “for the most part, hospitalists aren’t acquainted with cost and there is not a lot of cost transparency around what we do… In general, medical care needs to be discussed between physicians and patients so they can weigh the cost-benefit,” she said, which includes not just dollars and cents, but the impact associated with procedures, like radiation exposure from a CT scan.
However, Dr. Afsarmanesh acknowledges this is challenging, given the overall lack of cost transparency in the American health care system. “It is disjointed and we don’t have any other system where the professionals who do the work are so far-removed from the actual cost,” she said. “The good thing is, I think we are heading toward an era of more cost-conscious practice.”
In addition, hospitalists are poised to help with overall cost-reduction in the hospital. “I could imagine something relevant around readmissions and total cost,” said Dr. Patel. “But risk-adjustment is key.”
This category will increase to 30% of a provider’s or group’s overall score by payment year 2021, CMS says. It will be determined using claims data to calculate per capita costs for all attributed beneficiaries and a Medicare Spending per Beneficiary measure. The CMS also says it is finalizing 10 episode-based measures determined to be reliable and that will be made available to providers in feedback reports starting in 2018.4
Clinicians may report MIPS data as individual providers (a single National Provider Identifier tied to a single Tax Identification Number) by sending data for each category through electronic health records, registries, or qualified clinical data registries. Quality data may be reported through Medicare claims.
Hospitalists who report through a group will receive a single payment adjustment based on the group’s performance, using group-level data for each category. Groups can submit using the same mechanisms as individual providers, or through a CMS web interface (though groups must register by June 30, 2017).5
The SHM has also asked CMS to consider allowing employed hospitalists to align with and report with their facilities, though Dr. Greeno says this should be voluntary since not every hospitalist may be interested in reporting through their hospital. Dr. Greeno says CMS is “very interested and receptive” to how it could be done.
“We are trying to create the incentive for everybody to provide care at lower costs,” Dr. Greeno said. “There are two goals: Create alignment, and decrease the reporting burden on hospitalist groups.”
Additionally, CMS recognizes the potential burden MIPS imposes on small practices and is working to allow individuals and groups of 10 or fewer clinicians to combine to create virtual groups. This option is not available in 2017.4
The CMS has also authorized $100 million, dispersed over 5 years, for certain organizations to provide technical assistance to MIPS providers with fewer than 15 clinicians, in rural areas and those in health professional shortage areas.4
According to Modern Healthcare, projections by CMS, released last May, show that 87% of solo practitioners and 70% of physician groups with two to nine providers will see their reimbursement rates fall in 2019. Meanwhile, 55% of groups with 25 to 99 providers and 81% of those with 100 or more clinicians will see an increase in reimbursement.7
“I think it’s going to be pretty tough unless you’re big enough to commit the resources you need to do it right,” Dr. Greeno said. “If I was just a really small group with very little overhead, no infrastructure to support, I’d consider taking the penalty and just living with it because I don’t have many costs and just pay my own salary. But it’s still a hard road.”
Dr. Afsarmanesh says SHM continues to look across the board and advocate for all its members.
In 2019, physicians reporting under MIPS will see up to a 4% increase and as low as a 4% decrease in reimbursement. This rises to plus-or-minus 5% in 2020, 7% in 2021 and 9% thereafter.2
Dr. Patel and many others say it appears to be the intention of CMS to move providers toward alternative payment models. A January 2015 news release from the U.S. Department of Health and Human Services announced a goal of tying 50% of Medicare payments to Accountable Care Organizations (ACO) by the end of 2018 (it’s worth noting this was pre-MACRA, and not all ACOs qualify as Advanced APMs).8
“The awkwardness and clunkiness of MIPS needs to be addressed in order to make it successful because many people will be in MIPS,” Dr. Patel said. “I think it’s the intention to move people into Advanced APMs, but how long it takes to get to that point – 3-5 years, it could be 10 – physicians have to thrive in MIPS in order to live.”
One of the most important things, she and Dr. Berenson said, is adequately capturing the quality and scope of the care physicians provide.
“I know hospitalists complain how little their care is reflected in HCAHPS (the Hospital Consumer Assessment of Healthcare Providers and Systems) and the quality measures they have now, and readmission rates don’t reflect what doctors do inside the hospital. My colleagues are telling me they want something better,” Dr. Patel said.