Some influential advisers are urging modification of the fee-for-service physician payment system, instead of scrapping it as part of MACRA.

June 13—The growing criticism of Medicare’s new physician payment system has produced calls for Congress to overhaul it. And some policy experts expect changes.

The rollout of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) has progressed slowly, with regulators repeatedly extending and expanding exemptions to the law’s regulations, which cover the vast majority of physicians paid by Medicare. Those exemptions followed widespread complaints from physician advocates that small practices, especially, were unprepared for the quality-reporting burdens imposed by MACRA.

The Centers for Medicare & Medicaid Services (CMS) has slowly rolled out MACRA’s two payment arms—advanced alternative payment models (APMs) and the Merit-based Incentive Payment System (MIPS)—to smaller-than-planned populations of physicians. CMS added to the 2017 exemptions by exempting an estimated 934,000 physicians from MACRA requirements for 2018.

Those not exempted included 100,000 physicians who sought to qualify in 2017 for the 5 percent APM payment bonus. A CMS executive recently revealed that 99 percent of that group successfully qualified for the bonus. In comparison, CMS previously announced that 91 percent of all MIPS-eligible clinicians submitted data for 2017.

Going forward, CMS estimated that 39 percent, or 621,700, of Medicare physicians will be eligible for MIPS in 2018, and between 180,000 and 250,000 will qualify for APM bonuses.

The growing volume of exemptions means that only one in eight of all physicians are even subject to MACRA regulations, said Dan Todd, JD, a former senior healthcare counsel for the Senate Finance Committee who helped write the law.

“As far as I can tell, no one’s actually in MIPS,” Todd said jokingly during a recent ACO Summit in Washington, D.C.

But those exemptions have not quieted criticisms of MIPS.

MIPS is “very burdensome, confusing, and inequitable—other than that, it’s perfectly fine,” Mark Miller, PhD, former executive director of the Medicare Payment Advisory Commission (MedPAC), said recently. “I truly believe it’s not going to lead to effective change in the quality of care for patients. MIPS is a mess.”

What Congress Could Do

In March, MedPAC issued a report to Congress that recommended scrapping MIPS and replacing it with the Voluntary Value Program (VVP).

In a blog post, Nancy Foster, vice president of quality and patient safety policy for the American Hospital Association, described calls to get rid of MIPS as “premature but also misguided.” She was critical of the VVP as “logistically challenging and of dubious value.”

“The MACRA passed with strong bipartisan support, and the VVP is not a compelling alternative,” Foster wrote.

In contrast to calls to overhaul or terminate MIPS, some clinical leaders recently urged members of Congress to step in and end CMS exemptions to MIPS, according to published reports. The growing volume of exemptions not only has reduced the number of physicians who are subject to bonuses or cuts but also has slashed the amount of funding available for such bonuses because the program is revenue-neutral. CMS initially planned for $833 million in incentive payments to be available in 2019 (based on 2017 performance) under MIPS, but the expanding set of exemptions has cut the payment pool to $118 million for 2020 (for 2018 performance).

Gail Wilensky, the leader of Medicare under President George H.W. Bush, said she doubted Congress would act to “blow it up and start again” because of the effort that was required to pass MACRA with bipartisan support.

“Congress is perfectly capable of ignoring MedPAC’s recommendations,” said Wilensky, who previously chaired MedPAC.

Todd, the MACRA author, also said in an interview that he did not expect Congress to implement any major changes to MACRA. Instead, he expects CMS to continue rolling out tweaks to the program along the lines of those it already has implemented. Coming regulatory changes to MACRA include the alignment of quality measures between hospitals and physicians, a CMS leader announcedin March.

“You’re going to see a lot of that; it’s all moving toward the restoration of the traditional fee-for-service,” Todd said. “We all agree that we want to go to population-based payment, but the measures are not there.”

Wilensky said she expects MIPS implementation to proceed as planned but said Congress could move to implement a “slowdown-halt” in changes to physician rates and reporting requirements for a couple years among those who don’t qualify for APMs.

Meanwhile, the Center for Medicare and Medicaid Innovation could test out MedPAC’s VVP idea, Wilensky said.

“And say, ‘We need to know whether this is actually something that makes sense, and if it does should we put it in place of’” MIPS? Wilensky said.

Meanwhile, the Trump administration already proposed in its FY19 budget to replace physician quality reporting under MIPS with an automated process for awarding bonuses and cuts based on CMS’s evaluation of the physician data it already has.

Physician APMs

Among physicians looking for alternatives to MIPS, many were hoping that more physician-focused APMs would come from the Physician-Focused Payment Model Technical Advisory Committee (PTAC). The 11-member committee was created to assess physician APMs and recommend models to the secretary of the U.S. Department of Health and Human Services (HHS), but no such models have been launched.

So, far PTAC has reviewed more than 20 APMs and plans to review another 30, said Grace Emerson Terrell, MD, a member of PTAC.

“Many of them, with some work, could be very interesting” APMs, said Emerson Terrell. “I would suggest that some of that work could be advanced far more quickly than perhaps the [administration] wants.”

Robert Berenson, MD, a fellow at the Urban Institute and a member of PTAC, said many of the approaches proposed to that body are not payment models but “enhancements to the Physician Fee Schedule.” Echoing Todd, he said that approach is positive because moving all physicians to APMs “is wishful thinking.”

“You can improve value by those coding changes and the relative value scale,” Berenson said. “I don’t agree that the fee-for-service system has to be dispensed with.” 

However, of the new approaches PTAC has recommended to the HHS secretary over the last 14 months, it remained unclear whether any will be implemented, Berenson said.

Wilensky hoped Congress and CMS would dispense with testing more models and have a panel of practicing physicians and policy experts choose the best-performing models from among those that have been tested over the last eight years—such as bundled payments—and implement them throughout Medicare.

“Take the best of the bunch, put it in place, and stop torturing all of the clinicians and hospitals in the country with 15 more experiments,” Wilensky said.


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

Publication Date: Wednesday, June 13, 2018