Beyond the SGR fix

Wednesday, July 01, 2015 12:16 PM

Additional changes under H.R. 2 will benefit Colorado

by Kate Alfano, CMS Communications Coordinator

When the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law in April, it permanently repealed the sustainable growth rate (SGR) formula and stabilized Medicare payments for physician services with positive updates from July 1, 2015, through the end of 2019, and again in 2026 and beyond. However, the bill contained other provisions that will impact how physicians deliver care now and in the future. Below are key provisions in the SGR repeal legislation that should be beneficial for Colorado physicians, as well as when the changes will take place.

Quality reporting programs will be consolidated

Medicare’s current quality reporting programs will be simplified into one merit-based incentive payment system, referred to as “MIPS.” This consolidation of the Physician Quality Reporting System (PQRS), meaningful use electronic health record (EHR) program and the value-based payment modifier (VBM) will reduce the aggregate level of financial penalties physicians otherwise could have faced. 

Beginning in 2019, physicians who score well in MIPS could receive substantial bonuses. Performance will be based upon four categories – quality, resource use, meaningful use and clinical practice improvement activities. MIPS also would build and improve upon current quality measures and concepts in existing programs.

Physicians will be encouraged to report quality measures through certified EHR technology or qualified clinical data registries. Participation in a qualified clinical data registry would also count as a clinical practice improvement activity.

Alternative payment models will be rewarded

Physicians who participate in qualified alternative payment models (APMs) will receive a 5 percent bonus starting in 2019. These physicians also will be exempt from participating in MIPS. $20 million per year, from fiscal years 2016 through 2020, will assist practices of up to 15 professionals to participate in the MIPS program or transition to new payment models. Small practices (up to 10 MIPS-eligible professionals) can also elect to report together as “virtual groups” and receive a MIPS composite score for their combined performance.

MACRA creates an advisory panel to consider physicians’ proposals for new models and authorizes coverage for telehealth services in APMs, even if the service is not covered by the traditional Medicare program.

Several Medicare accountable care organizations (ACOs) and other new payment models already serve the state of Colorado. Under this law, policymakers will build on this foundation and provide opportunities for all Medicare patients to benefit from new models of care delivery that will support physician-led initiatives to improve the quality of care while lowering costs.

Physicians will have liability protections

The law incorporates the Standard of Care Protection Act that will protect physicians by preventing quality program standards and measures (such as PQRS or MIPS) from being used as a standard or duty of care in medical liability actions.

Administrative burdens will be reduced

Physicians who choose to opt out of Medicare to engage in private contracting can elect to automatically renew their status instead of manually renewing their status every two years. By October, the Secretary of the Department of Health and Human Services must report to Congress with recommendations for safe harbors from fraud and abuse laws to permit gainsharing or similar arrangements between physicians and hospitals to improve care and efficiency while reducing waste.

The law sets a goal of achieving widespread interoperability nationwide of EHR systems by Dec. 31, 2018. If the goal is not achieved by that date, the secretary can seek to adjust meaningful use penalties and/or decertify EHRs. The secretary must submit a report to Congress by April 16, 2016, on mechanisms that would assist physicians in comparing and selecting among certified EHR products.

Funding has been extended for a host of programs

Funding has been extended through 2017 for community health centers, the National Health Service Corps, and the Teaching Health Center Graduate Medical Education Payment Program, which provides residency training in community-based settings for family and internal medicine, pediatrics, OB-GYN and psychiatry.

Funding has also been extended through fiscal year 2017 for the Children’s Health Insurance Program (CHIP), currently serving over 8 million children and low-income pregnant women; the Child Enrollment Contingency Fund, for states facing a shortfall that meet an average enrollment target; and the qualifying states option that lets states use CHIP funds to expand Medicaid for children rather than setting up a separate program.

Colorado practices will have greater stability

The new law will help the more than 54,000 employees of medical practices in Colorado and help preserve access to care for the more than 667,000 Medicare patients and 231,000 Tricare patients who were at risk due to the previously threatened cuts. The physician payment reforms in MACRA provide an additional $120 million to the balance of 2015 for the care of elderly and disabled patients in Colorado, and $1.5 billion over the next 10 years.

More details on the merit-based incentive payment system program (MIPS)

The merit-based incentive payment system program (MIPS) will take effect in 2019. This new payment system will consolidate and replace the Physician Quality Reporting System, (PQRS), Meaningful Use (MU) and Value-Based Modifier (VBM) quality initiatives.

• Annual MIPS composite scores include four categories: quality (PQRS) – 30 percent; resource use (VBM) – 30 percent; MU – 25 percent; and clinical practice improvement activities – 15 percent.
• The annual “performance threshold” is based on the median/mean performance of all eligible providers for a prior period.
• The secretary may weight the categories differently.
• Individual eligible providers can join “virtual groups” and report together.
• Eligible providers with substantial revenue from qualifying APMs or with few Medicare claims are exempt from the MIPS program.
• MIPS-eligible providers include physicians, dentists, podiatrists, optometrists, chiropractors, physician assistants, nurse practitioners, clinical nurse specialists and nurse anesthetists.

MIPS penalties and bonuses (for scores below or above the annual performance threshold) are on a sliding scale, with maximum MIPS penalties: Up to 4 percent in 2019, up to 5 percent in 2020, up to 7 percent in 2021, and up to 9 percent in 2022 and beyond.