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CMS Publishes Proposal to Overhaul the Medicare Payment System

The agency overseeing the Medicare program detailed how it plans to implement payment reforms mandated by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). On April 27, the Centers for Medicare & Medicaid Services (CMS) published its proposed MACRA rule.

To address concerns pertaining to the pathology specialty with the CMS, the CAP has formed a special MACRA workgroup to advise on implementation of the new Merit-Based Incentive Payment System (MIPS) and alternative payment model (APM) pathways under MACRA. The MIPS program is estimated to have a $1.5 billion overall impact on the pathology specialty beginning in 2019.

MIPS will combine the current Medicare quality programs—the Physician Quality Reporting System (PQRS), Electronic Health Record Meaningful Use (EHR MU), the Value-Based Modifier (VBM)—as well as a new performance category termed "Clinical Practice Improvement Activities." The penalties established under the current PQRS, EHR MU, and VBM programs will sunset at the end of 2018. For the 2019 payment year, the CAP is working to ensure pathologists can comply with MIPS, which is the default pathway under MACRA. The CMS proposes to use the 2017 calendar year as its first year for measurement for MIPS.

A MIPS eligible clinician would receive no payment adjustment if the performance score is at the performance threshold, a negative adjustment if the score is below the performance threshold, and a positive adjustment if the score is above the performance threshold. The payment adjustments range from +/- 4% starting in 2019 to +/- 9% in 2022 and beyond.

The CAP will report additional details about the proposed rule in future editions of STATLINE. The CAP will also produce a webinar on the proposed MACRA rule in the near future.

CMS Offers Details on MIPS Criteria

For the first MIPS year in 2019, the CMS proposes to reweight categories for non-patient facing specialties without appropriate measures in a category. For pathology, categories without appropriate measures include Resource Use and Advancing Care Information, which is formerly the EHR MU program.

The CMS proposes to define non-patient facing MIPS eligible providers as those billing fewer than 25 patient facing encounters during a performance period. The CMS states that the majority of clinicians enrolled in Medicare under the specialty of pathology were identified as non-patient facing under MIPS this way.

The CMS did not provide specifics regarding the exact performance thresholds in the proposed rule. To establish a threshold for the MIPS categories of Quality, Resource Use, and Advancing Care Information (formerly referred to as the EHR MU program), the CMS proposed to model 2014 and 2015 historical data from PQRS, quality resource use report (QRUR) feedback data, and the EHR MU program. The CMS lacks data for the Clinical Practice Improvement Activities category and will need to apply additional analyses to set a threshold.

For the 2019 MIPS payment year, the CMS proposed to set the threshold at a level where about half the eligible clinicians are below, and the other half is above, the performance threshold. The CMS will determine the thresholds using established methodology in the final MACRA rule.

MIPS Categories

For the Quality performance category, MIPS eligible clinicians will be required to report on six measures or all that apply including one outcome measure. In the absence of an applicable outcome measure, eligible clinicians report on one appropriate use, patient safety, efficiency, patient experience or care coordination measure. The CMS is proposing to retain the eight current PQRS pathology measures developed by the CAP for this category.

In the first year, Quality represents 50% of the MIPS score for all eligible clinicians.

The CMS will use a subset of cost measures previously incorporated into the VBM to score resource uses. Since patients are attributed to eligible providers based on primary care services, no patients will likely be attributed to pathologists and therefore the CMS will be unable to measure pathologists in this category. The RU category which comprises 10% of the MIPS score in the first year will be reweighted to 0.

For non-patient facing eligible providers, such as pathologists, the CMS is proposing that they be allowed to report on a minimum of one activity to achieve partial credit or two activities to achieve full credit to meet the Clinical Practice Improvement Activity submission criteria. In general, this category would reward clinical practice improvements such as activities focused on care coordination, beneficiary engagement, and patient safety.

While the CMS is weighting the activities as either "medium" or "high," non-patient facing eligible professionals will receive partial or full credit for submitting one or two activities irrespective of any type of weighting, medium or high. This means that reporting of one medium-weighted or high-weighted activity would result in 50% of the highest potential score and reporting of two medium-weighted or high-weighted activities would result in 100% of the highest potential score.

In the Advancing Care Information performance category, the CMS proposes to automatically reweight the category to 0 for a MIPS eligible clinician who is classified as a non-patient facing MIPS eligible clinician (based on the number of patient-facing encounters billed during a performance period) without requiring an application to be submitted by the MIPS eligible clinician. This also applies to those specialties, including pathology, who had previously received an automatic hardship exception for MU. This category is 25% of the MIPS score in the first year of the program.

If the MIPS eligible clinician does not receive a resource use or advancing care information performance category score, and has at least three scored measures in the quality performance category, then the CMS proposes to reassign the weights to the quality performance category.

The CMS also proposes an alternative that does not reassign all the weight to the quality performance category, but rather reassigns the weight proportionately to each of the other performance categories for which the MIPS eligible clinician has received a performance category score.

Advanced Payment Models (APMs)

Physicians participating in eligible APMs receive a 5% bonus from 2019–2024 and are not subject to MIPS requirements.

The CMS is referring to eligible APMs as used in the MACRA statute as advanced APMs. Those existing Medicare models that the CMS has already identified will initially qualify as advanced APMs are the Comprehensive ESRD Care model, Comprehensive Primary Care Plus model, Medicare Shared Savings Program Model tracks 2 and 3, Next Generation Accountable Care Organization (ACO) Model, and the Oncology Care Model.

The CMS believes that many clinicians who participate to some extent in APMs may not meet the law’s requirements for sufficient participation in advanced APMs. The CMS does expect the number of clinicians who qualify as participating in advanced APMs will grow as the program matures.

Although the Physician-Focused Payment Model (PFPM) is not defined in the MACRA statute, the CMS proposed a definition and criteria in its draft rulemaking. Under the PFPM definition, Medicare must be a payer and other payers may be included. The models also should target the quality and cost of physician services. PFPMs may be individual physicians or physician group practices