MACRA Final Rule Released - More Advanced Alternative Payment Models

Early Friday morning, CMS released the highly anticipated final regulations for implementing the Medicare Access and CHIP Reauthorization Act. CMS did an excellent job listening to, and responding to, a vast array of comments from healthcare stakeholders. I believe the rule will move the country to where doctors are reimbursed for quality and value not volume.

In creating a clear path for small, independent physicians to embrace the transition to value, CMS makes it possible for leading independent practices to reduce costs, boost outcomes, and thrive.

First, CMS is lowering the risk for accountable care organizations (ACOs), while still exposing physicians and networks to the motivation that is the risk of writing CMS a check if results do not come to fruition (it’s a concept that was discussed back in March on AJMC.com). Because of this change, CMS projects an increase of 25% in the number of clinicians in advanced alternative payment models (APMs) in 2018 25%. CMS did this by lowering the risk threshold in 2017 and 2018 to 8% of the Part A and Part B fee-for-service revenues received by the physicians and other healthcare providers participating in the advanced APMs. This is an excellent focus on the motivational power of risk while also removing the existential threat of risk from healthcare providers of all sizes. The power of this change can hardly be overstated.

Second, CMS recognizes that 2017 starts in just 2-and-a-half months and calls 2017 what it was always going to be: a transition year. CMS strikes a balance between penalty and reward. By requiring most physicians to report at least 1 quality measure for 2017, CMS sends a clear signal that the move to value cannot be ignored. However, by limiting the threshold to a single measure they remove as much of the 2017 burden as possible. CMS is also right to reserve the rewards for those physicians and other clinicians who do go above and beyond in the transition year and report on more robust quality measurement. Specifically, to avoid a 2019 downward adjustment, physicians and other clinicians must report on just 1 measure. To receive a very small increase, they can report on a robust measure set for less than a year. To receive even more increases, physicians and clinicians can report on a robust measure set for the full year. For 2017, one would expect that the last group will be composed of those who are already doing full-year reporting, such as ACOs.

CMS should be applauded for the steps it took today. Of course, there is more work to be done. Advanced APMs, for example, need to be created to take advantage of the new, better risk threshold. We still need virtual groups to give small practices access to economies of scale in time for 2018 full Merit-based Incentive Payment System reporting. But today, we can conclude that CMS moved everyone closer to value without leaving anyone behind.

Travis Broome will serve as a panelist at the upcoming ACO & Emerging Healthcare Delivery Coalition, help October 20-21, in Philadelphia, Pennsylvania. To learn more, click here.