Medicare Access and CHIP Reauthorization (MACRA) Act Update July 2016

MACRA image 1MACRA stands for the new Medicare payment rules.  While MACRA did repealed the Sustainable Growth Rate (SGR) formula with its threatening cuts in payment it did create a new set of challenges which will make life interesting in the healthcare arena. MACRA offers two paths for reimbursement: The Merit-based Incentive Payment System (MIPS)

  •  Rolls quality based programs such as Physician Quality Reporting System, the Value Modifier Program, and the Medicare Electronic Health Record (EHR) Incentive Program into one.
  • Allows eligible providers to choose measures and activities appropriate to the type of care they provide.
  • By law MIPS must be budget neutral.  In other words, clinicians may receive anything from a reduction in pay of 4% to an increase of 4%.
  • CMS will begin tracking measures in January 2017 but payment based on these measures will not be seen until 2019.
  • Measure success based on four categories:
    1. Cost (10% of total score for year 1).  No additional reporting will be required as the score will be based on Medicare claims.
    2. Quality (50 % of total score in year 1). Clinicians may choose six measures to report values.
    3. Clinical Practice Improvement Activities (15% of total score for year 1). There are over 90 options to pick from. Activities that fall under this category include patient safety, care coordination, and many others.
    4. Advancing Care Coordination (25% of total score for year 1). Easier to understand if you look at it as the replacement for the EHR incentive program and it meaningful use requirements.

As specified under the statute, negative adjustments would increase over time, and positive adjustments would correspond. The maximum negative adjustments for each year are:







2022 and after








MIPS applies to Medicare Part B clinicians, including physicians, physician assistants, nurse practitioners, clinical nurse specialist, and certified registered nurse anesthetists. Exemptions to MIPS may be granted for new clinicians, clinicians have $10,000 or less in Medicare charges or their Medicare panel consists of 100 or less Medicare patients.  Another exemption is if they participate in an APM. Advanced Alternative Payment System (APMs)

  •  Participation in APM exempts Clinicians from MIPS requirements.
  • APM participants qualify for a 5% Medicare Part B incentive payment.
  • The participation requirements under APMs are specified in the statute and increase over time.
  • Some of the requirements include but are not limited to:
    • Must be a CMS Innovation Center model or a statutorily required demonstration
    • Require participants to bear a certain amount of financial risk.
      • CMS would withhold payment, reduce rates, or require the entity to make payments to CMS if its actual expenditures exceed expected expenditures.
    • Must base payment on quality measures that are evidence-based, reliable, and valid. In addition, at least one such measure must be an outcome measure.
    • 50% or more of participants must use certified HER in the first year.  The requirement increases to 75% in the second year.

    MACRA is quite complex with 900 pages of information to read as part of the initial process.  Potentially many Clinicians will not realize the impact and consequences until 2019 when Medicare starts paying based on two year old performance. Our advice is to become familiar with MACRA or hire someone to assist with the decision and implementation process.

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