Other worries about unintended impacts from the proposed rule have been raised by physicians and hospitals.

June 13—Several provisions of a looming Medicare physician pay overhaul could hurt the viability of smaller accountable care organizations (ACOs), officials from several such organizations recently wrote.

The comments from ACOs were in response to a proposed rule implementing the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which detailed how physicians will be paid under Medicare starting in 2019. MACRA will split physicians into those paid under the Merit-based Incentive Payment System (MIPS) and those paid annual lump sums and excluded from MIPS quality-reporting requirements by sufficiently participating in qualifying advanced alternative payment models (APMs).

However, the list of qualifying APMs excluded ACOs in Track 1 of the Medicare Shared Savings Program (MSSP). Ninety-five percent of the 434 MSSP ACOs are in Track 1.

That exclusion draw sharp criticism from smaller ACOs, which wrote that they already have challenges attracting enough physicians without the MACRA rules creating more disincentives.

“We have found it challenging to recruit [primary care physicians] to our ACO, and it would be very helpful if we were qualified to be an Advanced Alternate Payment Model,” wrote Steven Smith, medical director of a Track 1 ACO in rural Western Maryland. “There has been great expenditures of time and capital in setting up, staffing, and managing the ACO—much more than ‘nominal.’”

The Centers for Medicare & Medicaid Services (CMS) outlined three standards it will use to determine whether providers are assuming more than “nominal” financial risk, which is a key metric for determining eligibility as an advanced APM.

Deana Henk, CEO of an ACO offered by the Guadalupe Healthcare Network (GHN), said it was considering leaving the MSSP “due to duplicative operational costs and confusion of requirements that would be needed to operate under both the MSSP and MIPS programs.”

“If Track 1 ACO providers are required to meet both ACO [requirements] and the new MIPS reporting, we doubt that our providers will do both, forgoing their ACO participation as options for shared savings in our area may be minimal due to our current financial benchmarks,” Henk wrote.

Fifty-six percent of Medicare ACOs said in a recent survey that they likely would leave the MSSP if they are ruled ineligible for the APM track under MACRA.

The leaders of the Texas-based ACO believe it cannot move to the risk-bearing versions that qualify as APMs under MACRA because of the greater financial risk from having only 6,500 beneficiaries.

CPC Concerns

Another ACO raised concerns about the launch of a new physician payment model, Comprehensive Primary Care Plus (CPC+), which CMS announced in April and which will count as an advanced APM under MACRA.

CPC+ “will probably put an end to ACOs that have just spent a large amount of money on their implementation,” wrote Jennifer Teeter, ACO executive for the Frederick Integrated Healthcare Network. “These conflicting rulings make it difficult to achieve clinical integration and savings.”

However, a recent CMS policy change could help alleviate concerns that physicians will flee ACOs for CPC+. CMS decided in May to allow up to 1,500 practices to participate in both payment programs.

The fix is not comprehensive, given that 5,000 practices are expected to participate in CPC+, a voluntary, multi-payer primary care payment model.

Physician Concerns

The vast majority of the 473 MACRA comments submitted by June 13 decried the impact of the law on small physician practices. Many highlighted the implementing rule’s estimate that 87 percent of the nearly 103,000 solo practices would experience a combined pay cut of $300 million in 2019, the year the new payment system takes effect.

“It is improper and dangerous to force physicians into larger practices or into hospital employment,” wrote Kenneth Christman.

The possibility that MACRA could encourage more physicians to move to employed positions—due to increased quality-reporting or electronic health record-reporting requirements, for example—has been acknowledged by hospital industry advocates.

“There’s been increasing physician employment over time,” Ashley Thompson, a senior vice president at the American Hospital Association, said in a recent interview. “I don’t think [MACRA] will necessarily spike it, but you never know—it might be one of the outcomes.”

Hospitals employ almost 250,000 physicians and contract with almost another 290,000, according to Thompson.

The proposed MACRA rules drew concerns from Henry Ford Health System (HFHS), one of the few hospitals to have commented on the rules, so far. Among its concerns was the requirement that APM-eligible clinicians report MIPS data until their APM eligibility is formalized.

“A very large number of clinicians who are APM-eligible will end up wasting much time and effort reporting MIPS data that is ultimately discarded and useless,” wrote Nancy Schlichting, CEO of HFHS.

The health system participates in a Next Generation ACO and as both a provider practice and payer in the Oncology Care Model demonstration. Both would qualify as advanced APMs under MACRA.

All comments on the MACRA rules are due by June 27.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C. office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Monday, June 13, 2016