Rachel Groman, MPH
In April 2015, Congress passed the Medicare Access and Children’s Health Insurance Program (CHIP) Reauthorization Act (MACRA), the most sweeping set of changes to Medicare’s physician payment system since it was initiated 25 years ago. Although MACRA has made headlines for ending the historic cycle of large Medicare physician payment reduction threats by repealing the sustainable growth rate (SGR), it also represents an unprecedented and important shift away from traditional fee-for-service (FFS) reimbursement and toward value-based payments for Medicare physician services.
Although MACRA reforms target physician payments specifically, this philosophical trend toward value-based payments is universal: The federal government has specified a goal of tying 85% of all Medicare FFS payments to quality or value by 2016, and 90% by 2018. In an effort to move away from FFS, the government also set out to tie 30% of Medicare payments to quality or value through “alternative payment models” (APMs) by the end of 2016, and 50% by 2018 (Figure 1).
Over the next 5 years, the Centers for Medicare & Medicaid Services (CMS) will implement a new physician reimbursement system, under which payments will be driven by physicians' ability to deliver high-quality, cost-effective care and their willingness to test APMs. Hospice and palliative medicine (HPM) already delivers on the triple aim—better care for individuals, better care for populations, and lower costs—that is driving this shift in focus by CMS. And these priorities being reflected globally in payment incentives represents a unique opportunity for AAHPM to chart a course ensuring the value of the HPM physician is accurately measured and appropriately incentivized.
"To many clinicians, the term 'healthcare reform' has been an abstract one," said Arif Kamal, MD. "To date, clinicians had seen very little change relevant to their day-to-day billing and quality reporting activities. The SGR repeal and subsequent MACRA implementation unequivocally make quality and value the mission of healthcare. Quality can no longer be an accidental byproduct of our care."
MACRA in a Nutshell
MACRA fundamentally reforms how Medicare reimburses for physician services. As soon as 2019, all HPM physicians who get paid under Medicare Part B (not including hospice medical directors who only see patients enrolled in their hospices because they bill Part A) may enter into one of two pathways, scheduled to be finalized in late 2016: The first track preserves FFS, but offers enhanced incentives for value. The other provides incentives for participating in an APM to encourage high-value, rather than high-volume, care.
Track 1: Merit-Based Incentive Payment System (MIPS)
MIPS was created to replace the current confusing maze of federal quality reporting mandates with a streamlined program designed to minimize financial impacts on physicians, while still holding them accountable for value. MIPS essentially combines elements of current programs—including the Physician Quality Reporting System (PQRS), Value-Based Payment Modifier (VM), and Medicare Electronic Health Record (EHR) Incentive Program (ie, Meaningful Use)—under one merit-based payment system and reduces the aggregate level of financial penalties physicians otherwise could have faced.
This new payment structure—slated to start as soon as 2019—will initially be based on physicians' 2017 performance. Although the potential payment penalties—which will start at -4% in 2019 and grow to -9% by 2022—are less than projected under existing programs, they are still significant. At the same time, and contrary to current programs, there is the potential for physicians to earn positive performance-based payment updates. By the new standard, $500 million will be available each year from 2019 to 2024 to reward the top 25% of providers demonstrating exceptional performance.
Although the rules of this new program currently are being crafted, MACRA does mandate that MIPS payment adjustments derive from a single composite score based on annual physician performance in four weighted categories still under development (Figure 2):
- Quality Measurement (up to 30%). For the quality component, CMS will rely on both existing (eg, those used in PQRS) and newly solicited quality measures. MACRA also authorizes $15 million to be given annually for 5 years to professional societies and others to help fund the development of additional measures targeting existing gaps. The law also continues to emphasize the important role of clinical registries in capturing robust quality data.
- Resource Use (up to 30%). CMS may continue to rely on measures used under the current VM program. However, CMS also is required to develop, with the public's input, more specific, episode-based resource-use measures, and to engage with professionals to develop better methods for accounting for specific clinical roles, patient risk factors, and types of care provided in resource-uses analyses.
- Meaningful Use of EHRs (25%). Similar to the existing quality enterprise, physicians still will have to demonstrate meaningful use of EHRs to improve patient care, although details of how this will be accomplished are being developed. The law specifically tasks CMS with achieving better alignment between the metrics under this category and the quality measurement quality. MACRA also specifies a national objective of achieving widespread EHR interoperability by 2018, putting greater pressure on vendors to resolve barriers currently preventing widespread and meaningful EHR adoption.
- Clinical Practice Improvement Activities (15%). This is probably the most important component of MIPS because it represents the first time physicians will get credit for engaging in innovative activities not traditionally recognized or paid for under Medicare. Although not yet finalized, at a minimum, CMS must recognize activities that fall under the following subcategories:
- Expanded practice access (eg, same-day appointments for urgent needs and after-hours access to clinician advice)
- Population management (eg, participation in a clinical data registry) and care coordination (eg, remote monitoring)
- Beneficiary engagement (eg, care plans and shared decision making)
- Patient safety and practice assessment (eg, clinical checklists and other activities related to maintenance of certification)
- Participation in an APM.
For the first 2 years of the program, MIPS will impact only physicians, physician assistants, nurse practitioners, clinical nurse specialists, and nurse anesthetists. After that, all other providers will be eligible for MIPS.
Track 2: Alternative Payment Models
As an alternative to MIPS, providers can participate in a second track, which represents a more dramatic departure from traditional Medicare FFS reimbursements. Under this track, providers who receive a substantial portion of their revenue from eligible Medicare or all-payer APMs, such as accountable care organizations (ACOs) and patient-centered medical homes, will receive a 5% bonus each year from 2019 to 2024 and a higher cumulative payment update (0.75%) beginning in 2026. Although CMS has not yet defined specific criteria for satisfactory participation in a qualified APM, the models must, at a minimum, make use of certified EHR technology, employ quality measures comparable to those used in the MIPS quality category, and place a more than nominal financial risk on participant providers.
Although quality reporting mandates and the testing of innovative payment reforms have grown rapidly over the past decade, many HPM physicians have not yet felt a direct impact. That's because penalties for noncompliance and poor performance have been relatively minor, both in terms of financial risk and public accountability. The current set of available quality and cost measures also are only marginally relevant to HPM physicians, which results in data that are rarely meaningful or actionable for these physicians' patient populations. Similarly, the underlying methodologies used to evaluate physician performance are largely flawed and fall short in many critical areas, which further erodes faith in the system. Under the quality reporting programs and APMs tested to date, the individual physician rarely has much skin in the game. Instead, large health systems, facilities, and group practice administrators typically maintain control over participation decisions, without consulting the individual physicians they employ or sharing the resulting, potentially practice-influencing, data. As a result, many HPM physicians end up participating in these programs at a level that has little relevance to their daily clinical practice, or determining that it is more cost effective to incur nonparticipation penalties than to invest resources in these flawed programs. Either way, they are denied the chance to engage meaningfully in quality improvement efforts.
However, MACRA presents a unique opportunity to address many of these impediments, and for HPM clinicians to play a leading role in developing more meaningful ways to capture whether their patients are getting the level of quality they deserve. The newly established Clinical Practice Improvement Activities performance category under MIPS, in particular, is expected to offer HPM providers more choices of ways to demonstrate to CMS that they are engaged in meaningful quality improvement activities that are relevant to their practice setting and patient populations. The availability of $75 million in funding, to be distributed over 5 years for the purpose of measure development, could also help HPM target some existing measurement gaps. In addition, funding to provide small practices with technical assistance could assist HPM physicians with MIPS compliance or the transition to an APM. MACRA also provides HPM physicians the opportunity to become more autonomous participants in quality reporting programs by permitting the formation of "virtual groups" that are not necessarily dictated by the group practice or facility under which a physician bills. Finally, MACRA authorizes multiple enhancements to the science of measurement, such as requiring CMS to develop better risk adjustment methodologies and implementing a new system allowing physicians to designate their specific role in caring for a patient and the type of treatment provided to address current concerns about patient attribution.
The underlying philosophy and models of care that traditionally drive HPM care also put the specialty in a strong position to demonstrate its value through APMs.
"Because HPM clinicians spend a disproportionate amount of time with patients and families as compared to most other medical specialties, we have never fit well into the fee-for-service payment model," said Ruth Thomson, MD. "HPM physicians and programs are well-positioned for the value-based reimbursement payment model based on our philosophy and model of care. With our interdisciplinary, patient-centered approach, we inherently complement the value-based approach of the 'medical home' and ACO models and offer solutions to some of the big healthcare payer challenges, such as hospital readmissions."
The Road Ahead
The practice of medicine has entered an era of unprecedented scrutiny, in which regulatory accountability is at an all-time high. AAHPM realizes that hospice and palliative care providers feel this pressure on multiple fronts, beyond physician-level accountability and the Medicare payment system. AAHPM further recognizes that HPM physicians often grapple with how to meaningfully participate in these quality initiatives, especially given the paucity of truly relevant and actionable metrics and what often seems like a lack of control over determining the most meaningful ways to improve quality and overall value.
To maximize the relevance of these efforts, AAHPM will continue to work closely with policymakers to advocate for policies that will ensure meaningful improvements in care for both patients and caregivers of patients with serious illnesses and end-of-life needs. The specialty of HPM has come a long way in terms of the development of more meaningful measures—the National Quality Forum–endorsed set of palliative and end-of-life care measures and the AAHPM-HPNA Measuring What Matters Top Ten Measures List exemplify the field's maturation—but many of these measures still are not appropriate for physician-level accountability. We have further to go.
To help members navigate what will continue to be a complex maze of ever-changing requirements, AAHPM will continue to develop educational resources and other user-friendly tools that highlight the most relevant opportunities for engagement.
What Can I Do Now to Prepare for MACRA Implementation?
For the 2015 and 2016 performance years (and the respective 2017 and 2018 payment years), the PQRS, VM, and Meaningful Use programs will continue to exist in their current form. The penalties associated with nonparticipation for each of these programs are cumulative, and providers who fail to satisfy these requirements could be subject to up to a 9% payment cut in 2017, based on the 2015 performance year, and up to a 10% cut in 2018, based on 2016 performance.
Although MIPS will not begin until the 2017 performance year, the program is expected to rely, at least initially, on the performance measurement mechanisms of existing quality reporting programs. As such, it is critical that HPM providers start familiarizing themselves with the requirements of the PQRS, VM, and Meaningful Use programs, and start participating in these programs
as soon as possible.
For most physicians, preparing for this change is not done in a vacuum—even for the few who can independently make decisions regarding payment tracks and APMs for their practice. But those who are a part of a larger physician organization, health system, or ACO can engage with their system or partners to ensure HPM is best represented, and continues to be on the radar for system leaders.
To prepare for the transition and ensure you can make the greatest impact for HPM in your organization:
- Take the time to research and understand your local payment and delivery landscape. Meet with leaders in your own system to understand their strategies and learn more about their goals.
- Find out which metrics are most important to your system and partners, then build a strategy to ensure you report on these measures.
- Think strategically about new resources your program may require to close key gaps. Present these to your system leaders or partners to encourage their investment in your growth.
- Hear from experts at the 2016 Annual Assembly by attending sessions dealing directly with these issues, including "How to Design, Build, and Pay for a Community-Based Palliative Care Program," "Paying for Palliative Care: Innovative Models," and "Making Your Measurement Matter: Implementing the AAHPM & HPNA Measuring What Matters Project."
One important source of information to help you achieve these goals is the Quality and Resource Use Reports distributed by CMS annually, the most recent of which reflect 2014 performance data. These reports show how both groups and solo practitioners performed on cost and quality measures, including PQRS measures, and provide a preview of how these data will be used to calculate future VM payment adjustments. This report can help HPM physicians better understand their performance on current quality and cost measures, and help them prioritize potential areas for improvement.
Keep in mind that in addition to employing payment adjustments, CMS has stepped up efforts to promote higher-value care through public accountability. Beginning in 2016, CMS will provide the public with unparalleled access to physician quality performance data—and potentially additional indicators related to resource use and overall value—through its Physician Compare website. The level of data transparency and specificity is expected to increase considerably with the implementation of MACRA, so it will become increasingly important to track how data related to your practice is presented to the public.
The mandatory and punitive nature of these federal initiatives has dramatically altered the landscape, making it increasingly difficult for providers to sit on the sidelines and absorb the impact. MACRA presents a unique opportunity to press the reset button and adopt more thoughtful policies that incentivize truly significant improvements in care, rather than reporting simply for the sake of reporting. It is an opportunity to carefully develop the infrastructure needed to identify gaps in care and address how to most appropriately target those gaps. Finally, it is an opportunity to ensure the specialty of HPM has the flexibility to choose the most relevant and meaningful quality improvement and payment strategies.
As we continue down this path, we encourage you to share your personal stories, concerns, and ideas.
Taking a closer look at the challenges of measuring HPM quality and overall value:
- Ongoing lack of relevant measures: The existing gap in measures related to hospice and palliative care is significant and limits the reporting options available to HPM physicians. This is concerning considering the heightening reliance on public reporting and performance-based payment adjustments.
- Defining a denominator: HPM physicians are unique in that they provide care across multiple settings and patient populations. Current measures capture elements of HPM care (eg, pain control, dyspnea management, etc.), but there are no measures that specifically target the broad category of palliative care for patients of any age, without being disease, setting, or treatment specific. The specialty is in continued need of a common denominator that comprehensively captures the patient population appropriate for palliative care because no measures focus on this population exclusively.
- Risk adjustment: HPM providers often care for the sickest, most complicated and vulnerable patients, and they should not be punished or otherwise disincentivized for taking this risk. Similarly, there must be appropriate exclusions to account for the fact that routine standards of care do not always apply to these patient populations.
- Measure attribution: Should a palliative care team or physician be held accountable for a referring service not following their recommendations or the costs associated with that decision?
- Performance thresholds: How do we set performance thresholds in a manner that is both achievable and encourages ongoing improvements without creating too great of an administrative burden and interfering with clinical practice?
Rachel Groman, MPH, is the vice president for clinical affairs and quality improvement at Hart Health Strategies, a healthcare consulting firm that provides a range of advocacy services for AAHPM.