On September 8, 2016, CMS announced in a blogpost that new physician payment model reforms, established in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), will begin implementation on January 1, 2017, as proposed, but that physicians will have four participation options to choose from for the first reporting year. The CMS announcement came just two days after members of the U.S. House of Representatives Ways & Means and Energy & Commerce Committees expressed support for the implementation date but urged CMS to develop flexible rules for physicians. Concerns remain among the provider community about the short turn-around between the final rule, expected November 1, 2016, and the January 1, 2017 implementation date where clinical data would begin to count toward future payment years. The increased flexibility announced in CMS’s blogpost is intended alleviate some of these concerns.

Background

Earlier this year, CMS issued a Proposed Rule to implement provisions of MACRA. The final rule is expected to be published on November 1, 2016. Encounter data beginning on January 1, 2017 will affect physician payments in CY 2019. The new MACRA payment model, also known as the Quality Payment Program (QPP), establishes two different payment tracks for physician payment: the Merit-Based Incentive Payment System (MIPS) and the advanced Alternative Payment Model (APM).

MIPS combines components from three existing quality improvement programs – the Physician Quality Reporting System, Physician Value-Based Payment Modifier, and the Medicare Electronic Health Record Incentive Program for Eligible Professionals. Under MIPS, activities and measures are divided into four performance categories, including quality, advancing care information, clinical practice improvement activities, and cost. CMS will begin measuring physician performance in 2017 and will adjust payments based on that data beginning 2019.

As an alternative, physicians who participate in an advanced APM may qualify for a five-percent percent Medicare Part B bonus.  Accountable Care Organizations, Patient Centered Medical Homes and bundled payment models may qualify as advanced APMs.

House Committee Leaders Express Support for Early Implementation

On September 6, 2016, Republican and Democratic House committee leaders wrote a letter to HHS Secretary Sylvia Burwell in support of physician payment model reforms. In their letter, the House committee leaders urged CMS to establish rules that would simplify and streamline the various physician quality reporting programs while offering support for CMS’s proposed effective date for the new program of January 1, 2017. Specifically, the letter urged CMS to create “[c]lear pathways to succeed in MIPS or the APM tracks” and flexibility for all practitioners to move from MIPS track to the advanced APM track while encouraging CMS to have the new payment tracks ready for reporting in January 2017.

Many provider groups, concerned with the short two-month turn-around time between the final rule publication and implementation, were disappointed that the House committee members did not ask for a six-month delay in implementing the final rule. As we previously reported, CMS has considered the possibility of delaying implementation, noting that physicians may find it difficult to prepare for the first reporting period under the current start date.

CMS Responds to Implementation Concerns

In the September 8 announcement, CMS reaffirmed its intention to begin MACRA reporting on January 1, 2017, but announced that it will allow physicians to “pick their pace of participation” for the 2017 performance period. Noting that the options will be described fully in November’s final rule, the announcement provided brief descriptions of the four possible pathways:

1. Test the Quality Payment Program - The first option allows physicians to slowly begin submitting QPP data in order to ensure submission systems are working and to prepare for broader participation in 2018 and 2019. So long as at least some data is submitted, physicians will be allowed to gradually implement the system over the year.
2. Participate for Part of the Calendar Year - The second option allows participation for a reduced number of days, meaning the first performance period can begin later than January 1, 2017. With this option, physicians can still qualify for a small positive payment adjustment.
3. Participate for the Full Calendar Year - The third option allows physicians to begin fully reporting at the January 1, 2017 implementation date.
4. Participate in an Advanced APM in 2017 - The final option allows qualifying physicians to participate in an advanced APM. CMS notes that resources will be available to assist physicians to choose to participate in this option.

The American Medical Association (AMA) issued a statement, available here, in support of the flexible options for MACRA in 2017, stating that it believes CMS’s proposals will help give physicians a fair shot in the first year of MACRA implementation.

The CMS announcement is available here.  The House committee letter is available here. The Proposed Rule, issued May 9, 2016, is available here.