Final MACRA Rule Published

10/20/2016
On Oct. 14, the Centers for Medicare and Medicaid Services (CMS) published a final rule with comment period to implement MACRA’s Merit-Based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (Advanced APMs). 

Collectively, these programs are part of what CMS calls the Quality Payment Program (QPP). The final rule provides a slower and somewhat easier transition process for most physician practices. Although analysis of the final rule is still underway, some key highlights include:

•    The 2017 MIPS performance period, for Medicare physician payments that will be issued in 2019, is structured as a transition year to allow physicians greater time to prepare for full implementation.

•    CMS excluded more physicians from performance reporting by raising the low-volume threshold. Physicians are now excluded if they have less than $30,000 in annual Medicare revenue OR serve 100 or fewer Part B-enrolled Medicare beneficiaries. CMS estimates that this change will exempt 32.5 percent of eligible clinicians from the program. 

•    The only physicians who will experience a -4 percent payment penalty in 2019 are those who choose not to report any performance data for 2017 dates of service. 

•    Physicians can avoid the payment penalty in 2019 by reporting for one patient on one quality measure, one improvement activity, or the four required Advancing Care Information (ACI) measures in 2017. 

•    Physicians who wish to possibly qualify for a positive payment adjustment must report more than the minimum one patient for one quality measure, improvement activity or the four required ACI measures.

•    The cost/resource use category is not applicable for 2017 performance score determinations (a 10 percent weight had previously been proposed). Instead, 60 percent of the composite performance score will be based on the quality performance category in 2017.

•    For the MIPS quality component, physicians are required to report on six measures or a specialty measure set, one of which must be an outcome measure or, if no outcome measures are available, a high priority measure. In the final rule, CMS eliminated the proposal to report on a cross-cutting measure as one of the six quality reporting measures.

•    Claims-derived quality measures are also reduced in the final rule. An all-cause hospital readmissions measure was finalized for groups of 15 or more with 200 attributed cases (up from 10 or more in the proposed rule). CMS also eliminated its proposal to score physicians on the AHRQ acute and chronic composite measures using administrative claims data.

•    For the clinical practice improvement activities component, CMS reduced the reporting burden from 60 to 40 points. In addition, CMS expanded the recognized certification entities for patient-centered medical homes to include state, regional and private programs. This is particularly beneficial to Minnesota-certified health care homes, which can obtain full clinical practice improvement activity points as a result of this change. 

•    The reporting burden for the advancing care information component of MIPS performance assessment is reduced. Physicians must report on all required ACI measures in the Base Score (four in 2017 and five thereafter), with up to an additional nine optional measures in the Performance Score, for which physicians may receive additional percentage points. This is a reduction from the previous proposal to require reporting on 11 measures in the Base Score. Physicians must, however, report on all four measures in the base score in order to earn a score in the ACI performance category.

•    Although the final rule does not expand the number of eligible advanced alternative payment models (APMs) for 2017, CMS did acknowledge the need to expand the number of models quickly. CMS indicates that it plans to modify existing programs, such as the Bundled Payments for Care Improvement initiative, so they meet the Advanced APM requirements. It also plans to develop a new MSSP ACO Track 1+ that requires less downside risk than current Track 2 and Track 3 ACOs, but sufficient risk to meet the Advanced APM standards.

•    The advanced APM risk thresholds were also reduced. An APM will qualify as an Advanced APM in 2019 and 2020 if the APM Entity is either: 1) at risk of losing 8 percent of its own revenues when Medicare expenditures are higher than expected, or 2) at risk of repaying CMS up to 3 percent of total Medicare expenditures, whichever is lower. CMS states that it plans to increase the risk standard to 10 or 15 percent of revenues in future years. This is a significant reduction from CMS’ proposed financial risk requirements in which physicians were expected to pay up to 4 percent of total Medicare spending (as opposed to revenue) in order to qualify as an Advanced APM. The final rule also simplifies the definition of “more than nominal financial risk.”

See the MMA’s MACRA webpage for additional resources.