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MACRA Made Simple

(The following includes excerpts from our upcoming course, Strategic Issues for Boards, as well as information that didn’t make the cut.)


MACRA creates two different tracks for clinicians to participate in Medicare. One is called the Merit-Based Incentive Payment System, or MIPS. The second is the Advanced Alternative Payment Model (AAPM). Each of these tracks has different incentives.


MIPS judges clinicians across four different categories: quality, cost, improvement activities and meaningful use, or what is now called the advancing care information category. A composite score is created, and clinicians will be compared to others within MIPS. Depending upon how well they perform, clinicians will receive an upward or downward adjustment to their payment.


Under the AAPM track, different delivery models such as Accountable Care Organizations (ACOs) or the bundled payment program, are intended to align incentives across a continuum to drive the triple aim of improving quality, reducing costs, while improving patients’ experience of care.


When the proposed rules for the Quality Payment Program (a part of MACRA) were released, CMS initially projected that smaller practices, those smaller than one hundred eligible clinicians, would see the brunt of the penalties associated with the program. In fact, CMS projected that:


  • 97 percent of solo practitioners will receive some type of downward payment adjustment
  • 90 percent of practices with 25 eligible clinicians or fewer will have a downward payment adjustment


As a result of these projections and feedback from stakeholders, CMS implemented a transitional year in 2017, affecting payment in 2019, where there are lower thresholds for participation.


Preparing for MACRA


Preparing for MACRA requires a thoughtful approach:


  • Do an assessment to understand how well you are positioned both under MIPS as well as the potential to move into an Advanced Alternative Payment Model.
  • Identify areas for performance improvement.
  • Develop a strategic plan that outlines how you will move forward with MACRA and also is tied to a broader strategy related to other payment changes and delivery system reforms that are coming, or that you perceive to be coming from the new administration.
  • The MACRA strategy could take several forms; e.g., staying in MIPS for a few years, and then moving towards an Advanced Alternative Payment Model track, or staying in MIPS over the long run.


The Board


The board should recognize that MACRA will have an impact on the organization’s long-term viability. It affects how the organization supports employee clinicians, but also how it engages with independent clinicians.


MACRA sets up a dynamic where there are incentives to align with your clinicians, to be able to help them, ahead of “disruptor” organizations coming into the market that could potentially set up an ACO with your clinicians. Your organization would then be a “cost center” of the disruptor-owned ACO.


MACRA will have a major impact on how you work with clinicians in the future, as well as how you continue to evolve with the new payment models. There is no new money coming into health care, and so working well with clinicians, moving towards population health models that will help you be successful under value-based reimbursement is going to be a key critical differentiator for your health system


(Excerpt from Seth Edward’s interview for iProtean, now part of Veralon’s upcoming course, Strategic Issues for Boards.)



Check your library for the advanced Finance Course, Financial Risks & Strategic Implications of APMs, featuring Marian Jennings and Seth Edwards. In this course, Marian and Seth discuss the financial risks of ACOs and bundled payments, the strategic risks of not participating in an alternative payment model, clear trends and the characteristics of organizations that have successfully implemented one or more alternative payment models.



For a complete list of iProtean, now part of Veralon courses, click here. www.veralon.com/index.php/iprotean/onlineCourses/Available_courses



For more information about iProtean, now part of Veralon, click here.