How Finance Can Play a Pivotal Role in the Transition to MACRA

July 5, 2017 11:26 am

By combining meaningful use, the Physician Quality Reporting System, HCAHPS, population health management, and other required programs, MACRA places healthcare finance directors in a position to significantly strengthen the financial health of their organizations.

Through 2016, healthcare providers were challenged with the process of reporting various quality measures to the Centers for Medicare & Medicaid Services (CMS). Many provider groups found the administrative process of ensuring the initiatives of the Physician Quality Reporting System program (PQRS), meaningful use, and the value-based modifier were adequately documented and reported burdensome for all members of the group. The implementation of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) in 2017 will see some ease in the administrative processes for all members of physician practices.

Another positive aspect of the transition to MACRA is in the potential financial impact. Under the multiple quality initiatives in place through 2016, providers were at risk for up to 11 percent of their Medicare payment; MACRA reduces that risk to 4 percent for groups reporting MIPS and to 5 percent for groups reporting advanced alternative payment models (APMs).

At first glance, it would appear the providers and their respective finance teams have gotten a bit of breathing room in the work necessary for a successful transition. That may not be the case, however; in preparation for MACRA, current workflows and data analytics necessary to ensure a successful transition and performance will need to be reviewed and revised while the organization also maintains the quality of patient care, engagement, and financial outcomes.

Finance leaders and the revenue cycle team are well positioned to guide the administrative functions and overall performance of the MACRA program. Although the overall patient care and outcomes clearly are tied to the clinical teams, the finance team often is closest to data and coding/documentation information, making finance’s role critical in a MACRA initiative.

The finance director and team should act as a gatekeeper or facilitator to the initiative, ushering the organization through the transition and then monitoring performance. Provider groups that are particularly large or complex may opt to identify a point person who directs the initiative, reporting progress to the finance director.

Creation of a Steering Committee

As with any major initiative, preparation is critical. A key first step is to create a steering committee including physicians and clinical staff, front- and back-office team members, and medical records staff. This team can identify and lead areas of the initiative specific to their daily duties. While the finance team facilitates the transition activities, the steering committee can handle the heavy lifting of communication, training and support, and future clinical and operational improvements.

Data analytics plays a major part in successful preparation and transition. Review of pre-MACRA data is beneficial in understanding areas of solid performance as well as areas of opportunity.

However, the data elements used after implementation of MACRA may be different from those used in the past. Although MACRA relieves much of the administrative burden related to quality reporting, supportive key performance indicators will vary in detail, volume, and frequency of analysis and review. As indicated earlier, detailed data regarding patient encounters typically are managed by the finance team. Sharing this information with the steering committee, and possibly the larger organization, can be beneficial to MACRA transition efforts. Indeed, an important step in any transition is a mechanism for delivering ongoing communication to ensure all members of the organization are aware of initiatives and progress.

The Transition Begins

After the steering committee has been put in place, data reviewed, and reporting measures and options identified, transition work can begin. The steering committee, led by the finance team, should work to set new behaviors and patterns, especially regarding data mining and providing feedback.

For example, consider tracking of patients with chronic conditions, such as diabetes. Many electronic health records (EHRs) contain registries or other tracking mechanisms within their systems, but EHRs rarely include any trending of that data to claims billed with a primary diagnosis of diabetes, or to scheduling of patients for a diabetes education program. Identifying all data points specific to types of patients or care programs can provide a deeper look into the care and subsequent outcomes for that particular population.

Monitoring of key performance indicators in more administrative tasks, such as charge capture and documentation completion, offers another example. Outliers in these areas could be tied to snags in workflow or technology that could indirectly affect overall quality measures and their reporting.

Practices participating in the Merit-based Incentive Payment System (MIPS) stand to be penalized 4 percent of their Medicare payment by not reporting in 2017. The potential to earn up to an additional 4 percent of Medicare payment should not be missed, simply due to lack of planning and implementation. Practices reporting under APMs can earn up to 5 percent of Medicare payment in the first reporting period.

Healthcare organizations should consider the relaxed reporting options in 2017 as a gift of time to solidify workflows around quality, resource utilization, clinical improvement activities, and advancing care coordination and information. In preparation for implementation of MACRA initiatives, practices should work to identify:

  • Patient populations with the highest volumes or highest costs
  • Episode-of-care cost measures relevant or prevalent in practice
  • Physician champions to support improvement initiatives
  • EHR vendors’ certification and ability to comply with MIPS
  • Reporting needs specific to practice measures

These and all other activities related to MACRA should be monitored by the finance director. As gatekeeper or facilitator of the transition, the finance director should assume responsibility for reviewing data, speaking with clinical peers, and meeting with the steering committee.

The finance director also should work to ensure his or her team understands the processes to monitor and ensure compliance and appropriate financial impacts. Under MIPS, each component of reporting is assigned a weight, which is used to calculate the incentive payment. Finance teams should understand each category, its weights during the transition year, and the process of applying that information to actual data.

Performance Feedback

Access to performance data is essential to assess practice activities and the potential impact of the MACRA transition. Medicare provides some performance feedback; however, there is a considerable lag between the implementation of MACRA and the initial feedback to the physician practice. To be able to strategize for the future in a timely manner, practices should collect and analyze their own data.

The payment adjustments increase from +/–4 percent for the 2017 reporting period, to +/–9 percent for the 2022 reporting period. In the transition period that began Jan. 1 of this year, the size of a practice’s incentive payment will depend on how much data was reported, and when. Practices reporting throughout 2017 should realize payments closer to the 4 percent adjustment rate; practices that do not report will, of course, not receive an incentive payment. Tracking the reporting and documentation practices of a healthcare organization is the primary mechanism of ensuring optimal payment adjustments.

Feedback data can be analyzed and applied to initiatives to improve or modify processes involved in performance or reporting of patient engagement, outcomes, and care coordination. A key area of focus in the initial phases of MACRA is the quality component; the highest percentage of payment adjustment—and thus, the greatest potential—lies within that component.

Implementing Early Improvements

Areas with incomplete or unspecific documentation usually are first seen by the coding and clinical documentation improvement (CDI) staff. These teams can be a valuable resource for clinicians, educating and informing the clinicians on how best to document their activities regarding patient care. It may be necessary to provide refresher training on ICD-10.

Practices that have resisted implementing tools or workflows that improve efficiency should consider what they have in place to assist in the MACRA transition. Key questions include:

  • Does the organization have a patient portal? And if so, are patients using it?
  • Is the organization fully utilizing EHR activities such as computerized provider order entry or e-prescribing?
  • Can staff pull reports to monitor outcomes or create internal registries for patients with chronic conditions?
  • Is the EHR certified to report for MIPS?

Resources are available—including, in some cases, financial assistance through CMS—to help smaller groups fully prepare for MACRA. See, for example, CMS’s fact sheet Flexibilities and Support for Small Practices , which provides information and education for small provider groups and directs them to available resources. 

One particularly challenging area for many groups will be measuring and monitoring care coordination or communication activities, as data may not be readily available to the finance group. Practices should use this year—when reporting requirements are relaxed—to assess current workflows and implement improvements.

There can be ways to address those challenging areas with little to no tracking information. For example, if the practice’s contracts with health plans include language specific to appointment availability or timeliness of returned calls, the practice may start with that information to review and analyze its experiences and habits. If there is a method to communicate admission, discharge, or consultation information to primary care physicians, the practice can begin to record and track those communications. Anecdotal information from clinical staff also can prove useful.

APM providers will need to review their processes for patient tracking and care delivery. Organizations should take full advantage of the capabilities of their EHRs in high-volume areas such as patient-centered medical homes or end-stage renal disease facilities to ensure documentation of all aspects of patient care is adequate, consistent, and complete, and to include follow-up with patients who miss appointments, struggle with keeping current on medications and vaccinations, or are otherwise noncompliant.

Provider groups have been practicing and reporting quality initiatives for several years, but the with the implementation of MACRA, the individual silos of quality, resource utilization, innovation, and care coordination come together in a singular system. Likewise, having a central point of management within the organization—specifically within the finance department—will put a practice in a stronger position to improve patient care and optimize payment. 

Karen England, MBA, CPC, COC, CPPM, is a director of patient access services for a multispecialty physician practice in the Midwest.


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