The history of value-based care

The Centers for Medicare & Medicaid Services (CMS) defines value-based care as those programs that “reward health care providers with incentive payments for the quality of care they give to people with Medicare.” CMS began emphasizing value-based, quality healthcare over the quantity of provider visits in 2008. Since then, additional programs have been put into place that direct the reporting requirements and the payment levels based on certain circumstances.

In 2008, CMS initiated the Medicare Improvements for Patients and Providers Act (MIPPA) which, in part, rewarded eligible healthcare providers for electronic prescriptions. The next year, the Health Information Technology for Economic and Clinical Health Act (HITECH) was included in the American Recovery and Reinvestment Act of 2009 (ARRA). HITECH established programs under Medicare and Medicaid to provide incentive payments to eligible healthcare providers for the “meaningful use” of certified electronic health record (EHR) technology.

The Affordable Care Act (ACA) was implemented in 2010. ACA placed more emphasis on quality care and authorized a number of value-based programs that rewarded healthcare providers based on that quality rather than on quantity. Just a few years later, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law as a bipartisan legislation on April 16, 2015.

CMS states that “MACRA created the Quality Payment Program that:

  1. Repeals the Sustainable Growth Rate formula
  2. Changes the way that Medicare rewards clinicians for value over volume
  3. Streamlines multiple quality programs under the new Merit Based Incentive Payments System (MIPS)
  4. Gives bonus payments for participation in eligible alternative payment models (APMs)”

In recent years, healthcare provider feedback regarding the reporting burdens and complications placed upon them by value-based reimbursement program requirements has caused CMS to re-evaluate some of their initiatives. CMS has launched an Innovation Center supporting “the development and testing of innovative health care payment and service delivery models.” The Innovation Center seeks further input from physicians and other healthcare providers as they test “various payment and service delivery models that aim to achieve better care for patients, smarter spending and healthier communities.”

Sam Peirce
September 25, 2018


Tips for avoiding a payment penalty in 2018 for MIPS

Minimum reporting requirements for the Merit-based Incentive Payment System (MIPS) track of Medicare’s Quality Payment Program (QPP) have been raised somewhat for 2018. Previously, independent physicians had only to report on one measure to meet the qualifications. For 2018, however, physicians must earn a minimum of 15 points to avoid a payment penalty.

The American Medical Association (AMA) has published a list of tips for independent physicians so they can earn incentives and avoid the payment penalty. The AMA tip sheet points out that the general formula for determining an independent physician’s score within a performance category is: “Points earned by physician / total possible points within the performance category x performance category weight = Earned points.” It adds that “A physician’s four performance category scores (as well as any bonus points) will then be added to determine a physician’s final score.”

Smaller practices of 15 or fewer clinicians can meet the performance threshold and avoid a payment penalty by:

  • Reporting one high-weighted Improvement Activity
  • Reporting one medium-weighted Improvement Activity and 1 Quality measure
  • Reporting six Quality Measures
  • Reporting Advancing Care Information base score and one Quality measure

Tips for larger practices of 16 or more clinicians to meet the performance threshold and avoid a payment penalty for 2018 include:

  • Reporting two high-weighted or four medium-weighted Improvement Activities
  • Report two medium-weighted Improvement Activities and four Quality measures
  • Report Advancing Care Information base score and two Quality measures

The AMA points out that, in developing these tips, it assumes “the quality measures reported meet the data completeness requirement (60% of all eligible patients and report each measure for a minimum of 20 patients) and that the practice is scored on the all-cause hospital readmission measure.”

2018 reporting impacts the independent physician’s 2020 MIPS payment. Following these tips now can help the healthcare provider qualify for incentive payments and avoid a penalty.

Sam Peirce
September 18, 2018


How CMS is trying to tackle interoperability

In a continuing effort to promote interoperability between electronic health record (EHR) systems, the Centers for Medicare & Medicaid Services (CMS) has issued, as part of their recently published proposed changes, a renaming of the Merit-Based Incentive Payment System (MIPS) Advancing Care Information performance category to Promoting Interoperability (PI). Interoperability is, quite simply, a sharing of information between EHR systems, to enable seamless collaboration among healthcare providers.

CMS states that the renamed Promoting Interoperability category:

  • Emphasizes patient engagement and the electronic exchange of health information using Certified Electronic Health Record Technology (CEHRT).
  • Is worth 25% of the MIPS Final Score in 2018.
  • Is comprised of a Base, Performance, and Bonus score. All added together to give a clinician or group a Promoting Interoperability performance category score. Must fulfill the Base score to earn a Promoting Interoperability performance category score.
  • Includes a minimum performance period of 90 days.
  • Requires the use of CEHRT to capture data and fulfill the performance category

To aid in the transition, CMS has established two Promoting Interoperability measure sets that are available for clinicians in 2018:

  • Promoting Interoperability Objectives and Measures
  • Promoting Interoperability Transition Objectives and Measures

CMS explains that the “measure set a clinician or group selects will depend on the CEHRT edition. Clinicians and groups who exclusively report the Promoting Interoperability Measures using 2015 Edition CEHRT will earn a 10% bonus.” Providers can report the Promoting Interoperability Objectives and Measures if they have 2015 Edition CEHRT or a combination of 2014 and 2015 Editions of CEHRT. Providers who have 2015 Edition CEHRT, 2014 Edition CEHRT, or a combination of 2014 and 2015 Editions of CEHRT, can report the Promoting Interoperability Transition Objectives and Measures.

The interoperability score is based on factors such as patient access to records, providing patients a summary of care, secure messaging capabilities, clinical information reconciliation, and reporting certain improvement activities using CEHRT.

Sam Peirce
September 4, 2018


2017 MIPS performance results so far

The Quality Payment Program (QPP) is an incentive program for healthcare providers implemented by the Centers for Medicare & Medicaid Services (CMS). The QPP rewards value and outcomes, in a move toward value-based care, through two separate programs: the Merit-based Incentive Payment System (MIPS) and the Advanced Alternative Payment Models (APMs). The healthcare provider’s performance is measured in terms of Quality, Improvement Activities, Promoting Interoperability (formerly Advancing Care Information), and Cost.

To be eligible for the MIPS program, the healthcare provider must meet the low volume threshold set by CMS, which is based on allowed charges for covered professional services under the Medicare Physician Fee Schedule (PFS) and the number of Medicare Part B patients who are furnished covered professional services under the Medicare Physician Fee Schedule. The initial goal for CMS was to have 90% of healthcare professionals eligible for MIPS submit their data in 2017.

The preliminary results show that CMS has met their goal, plus a little more. The numbers show that 91% of those healthcare providers eligible for MIPS submitted their data successfully in 2017. Accountable Care Organizations (ACOs) showed even more impressive numbers with 98% submitting data in 2017. Additionally, 94% of small and rural healthcare practices submitted MIPS data successfully in 2017.

Most independent physicians probably did not see significant incentive payments, however. The MIPS structure is such that incentives are paid out from the penalties collected. In 2017, healthcare providers who submitted any data were able to avoid the penalties, to encourage participation.

Of those who submitted their data successfully in 2017, many providers will see neutral or minimally positive payment adjustments. The exception will be for those healthcare providers who achieved exceptional performance based on the scoring metrics. Those payments are made from an existing $500 million incentive pool.

The official CMS report on final MIPS scores was scheduled to be published in the summer of 2018.

Sam Peirce
August 29, 2018


CMS recommends EHR integration of PDMP data to improve opioid prescribing and reduce provider burden

In a letter addressed to State Medicaid Directors, the Acting Director of the Centers for Medicare & Medicaid Services (CMS), Tim Hill, urges the use of prescription monitoring tools to help combat the opioid crisis. The letter emphasizes “the importance of enhancing prescription drug monitoring programs (PDMPs) to help improve appropriate and safer prescribing of prescription opioid medications, and integrating connections to PDMP data into EHRs to limit provider burden and improve interstate Health Information Exchange (HIE).”

A PDMP is “an electronic database that tracks controlled substance prescriptions. PDMPs can help identify patients who may be misusing prescription opioids or other prescription drugs and who may be at risk for overdose.” Through the use of PDMPs, independent physicians can monitor and better control opioid prescriptions, “reducing the number of people who misuse, abuse, or overdose from them, while making sure patients have access to safe, effective pain management.”

Hill describes several funding options for implementing these tools as well. He explains that “States may claim the 90 percent HITECH match for costs related to the design, development, and implementation of PDMPs and connections to PDMPs so long as the cost controls described in SMD 16-003 are met and so long as these costs help Eligible Providers meet Meaningful Use measures focused on public health reporting and the exchange of public health data described in 42 CFR 495.22 and 495.24.”

Another option for PDMP funding is through Medicaid Management Information System (MMIS) matching funds, which Hill says “may be a more appropriate source of federal funding for costs related to developing a PDMP in some cases, and states should not claim 90 percent HITECH match for costs that could otherwise be matched with MMIS matching funds.”

Given the magnitude of the opioid crisis, including the fact that it was recently declared a nationwide public health emergency, CMS is encouraging states “to minimize provider burden by integrating PDMP data into EHRs, as may be practicable, and to consider complementing PDMPs with provider onboarding and training.”

Sam Peirce
August 24, 2018


CMS proposed changes to the Physician Fee Schedule and MACRA

Independent physicians often face daunting challenges when it comes to Medicare and Medicaid paperwork. Providers want to spend more time with patients and less time filling out required forms and completing reports. The Centers for Medicare & Medicaid Services (CMS) is beginning to recognize the importance of this situation and, in fact, has announced proposed changes that would ease the administrative burden on independent physicians.

CMS states that its new proposed rules “would fundamentally improve the nation’s healthcare system and help restore the doctor-patient relationship by empowering clinicians to use their electronic health records (EHRs) to document clinically meaningful information, instead of information that is only for billing purposes.”

Provisions in the proposed CY 2019 Physician Fee Schedule, developed in response to stakeholder concerns, “would help to free EHRs to be powerful tools that would actually support efficient care while giving physicians more time to spend with their patients, especially those with complex needs, rather than on paperwork. Specifically, this proposal would:

  • Simplify, streamline and offer flexibility in documentation requirements for Evaluation and Management office visits — which make up about 20 percent of allowed charges under the Physician Fee Schedule and consume much of clinicians’ time;
  • Reduce unnecessary physician supervision of radiologist assistants for diagnostic tests; and
  • Remove burdensome and overly complex functional status reporting requirements for outpatient therapy.”

CMS Administrator Seema Verma has reassured physicians that the organization is listening to their concerns. She says that the proposed changes to the Physician Fee Schedule and MACRA address their challenges by “streamlining documentation requirements to focus on patient care and by modernizing payment policies so seniors and others covered by Medicare can take advantage of the latest technologies to get the quality care they need.”

In addition, the proposed Physician Fee Schedule changes would reinforce the concepts in the Patients Over Paperwork initiative, which is “focused on reducing administrative burden while improving care coordination, health outcomes, and patients’ ability to make decisions about their own care.”

Some physicians and healthcare groups have concerns about some of the proposed MACRA changes. For example, many argue that the cut to physician reimbursement for Part B drugs could actually raise prices for prescription medications. Another proposed MACRA change is the payment reduction for the “critical evaluation and management of more complex cancer cases from $172 to $135 (a 22% payment cut) for a new patient and from $148 to $93 (a 37% payment cut) for an existing patient,” which greatly concerns groups such as the American Society of Clinical Oncology.

Additional MACRA changes proposed by CMS include continuing “its policy requiring physicians to document a full 365 days of quality measures rather than 90 consecutive days” and a requirement to upgrade to 2015 Edition Certified Electronic Health Record Technology beginning in 2019.

Public comments on the proposed rules are due by September 10, 2018.

CMS has made available the following documents for physicians to review:

Fact sheet on the CY 2019 Physician Fee Schedule proposed rule

CY 2019 Physician Fee Schedule proposed rule

Fact sheet on the CY 2019 Quality Payment Program proposed rule

CY 2019 Quality Payment Program proposed rule

Fact sheet on the Medicare Advantage Qualifying Payment Arrangement Incentive (MAQI) Demonstration

Sam Peirce
August 14, 2018


Healthcare organizations more optimistic about value-based care in 2018

Just two years ago, a majority of physicians expected that the trend toward value-based care would hurt their practices financially. In 2018, the numbers are more optimistic with many physicians seeing the emphasis on quality versus quantity and on practice efficiency as actually benefiting their practices. A poll conducted by KMPG in June 2018 found that 46% of the physicians participating saw value-based contracts as improving their profitability.

The KMPG poll involved 221 healthcare professionals who were asked several questions about value-based care and its impact on their practices, during a June 5 webcast. The results were then compared to a similar survey conducted in 2016 of 142 healthcare professionals.

As summarized in Becker’s Hospital CFO Report, the 2018 survey found that:

  1. Nearly half of healthcare organizations (46 percent) expect higher operating profits from value-based contracts, compared with 23 percent in 2016.
  2. Thirty-four percent of healthcare organizations expect value-based contracts to be neutral to operating results. That’s up from 25 percent two years ago.
  3. Twenty percent of healthcare organizations expect reduced operating profits from value-based contracts, compared with 52 percent in 2016.
  4. Overall, fee-for-service still remains the primary reimbursement method for healthcare organizations.

Matt Snyder, KPMG advisory principal who focuses on internal audit and enterprise risk at healthcare organizations, stated that “We are beginning to see performance based payment models replacing traditional fee-for-service models.” He added that healthcare professionals will need to focus on high quality healthcare service as well as transparent and secure data reporting capabilities if they want to succeed in the new value-based climate.

However, the trend toward value-based care is slow-growing. The “fee-for-service” model is still prevalent among healthcare professionals. The KMPG survey found that “Only 10 percent of respondents said they had a majority of their contracts tied to value-based reimbursement, such as shared savings, bundled payments (a flat-rate for a given medical procedure), or capitation for a given patient population.”


Sam Peirce
July 30, 2018


CMS announces MAQI demonstration to waive MIPS requirements

In a move to further ease the information collection and reporting burdens for independent physicians while continuing to focus on value-based care for patients, the Centers for Medicare & Medicaid Services (CMS) has announced that it worked to put Medicare Advantage providers on a more level playing field with fee-for-service providers.

CMS has said that it will advance the Medicare Advantage Qualifying Payment Arrangement Incentive (MAQI) Demonstration, which “would waive Merit-Based Incentive Payment System (MIPS) requirements for clinicians who participate sufficiently in certain Medicare Advantage plans that involve taking on risk.” The MAQI demonstration must still be approved and adopted.

Under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), independent physicians have two tracks for payment under Fee-for-Service Medicare. MIPS requires clinicians to report quality data to CMS and have their payment adjusted accordingly and Advanced Alternative Payment Models (Advanced APMs) require clinicians to take on risk for their patients’ healthcare spending.

Physicians who participate in Medicare Advantage plans have written to CMS urging recognition of their participation criteria toward MACRA’s Quality Payment Program (QPP). While CMS recognizes that some “Medicare Advantage plans are developing innovative arrangements that resemble Advanced APMs …. without this demonstration, physicians are still subject to MIPS even if they participate extensively in Advanced APM-like arrangements under Medicare Advantage.”

CMS Administrator Seema Verma says that “The MAQI Demonstration aligns with the Agency’s goal of moving to a value-based healthcare system, and aims to put Medicare Advantage on a more equal playing field with Fee-for-Service Medicare.” She adds that “CMS intends to test whether MIPS exemptions provided to clinicians under MAQI will increase participation in Medicare Advantage plans that are similar to Advanced APMs, and thereby accelerate the transition to a healthcare system that pays for value and outcomes.”

CMS is currently seeking comments on the information collection burdens associated with the demonstration.

Sam Peirce
July 9, 2018


CMS looking to make changes to Stark Law requirements

In 1989, a law was enacted to prohibit physicians from profiting financially when they make referrals. The law, which became known as the Stark Law, essentially “prohibits physicians from referring patients to receive ‘designated health services’ payable by Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies.” The Stark Law is closely aligned with the Anti-Kickback Statute (AKS), both of which aim to prevent physicians from profiting when making patient referrals.

The Centers for Medicare & Medicaid Services (CMS) is now considering making changes to the Stark Law and is seeking input from physicians as it moves forward with its plans. CMS explains that the law specifically: (1) prohibits a physician from making referrals for certain designated health services (DHS) payable by Medicare to an entity with which he or she (or an immediate family member) has a financial relationship (ownership or compensation), unless an exception applies; and (2) prohibits the entity from filing claims with Medicare (or billing another individual, entity, or third party payer) for those referred services.

CMS has issued a Request for Information (RFI) seeking comments and addressing the background of the potential changes to the Stark Law. The RFI states that “The Department of Health and Human Services (HHS) is working to transform the healthcare system into one that pays for value” and has “launched a Regulatory Sprint to Coordinated Care, led by the Deputy Secretary.” The Regulatory Sprint is “focused on identifying regulatory requirements or prohibitions that may act as barriers to coordinated care.”

The RFI lists twenty questions that CMS would like answered by those physicians responding and providing input. Many of the questions relate to the need to coordinate care, alternative payment models, accountable care organizations (ACOs), and the role of transparency. Comments and responses must be submitted no later than 5pm, 60 days after the date of publication in the Federal Register, which was June 25, 2018.

Sam Peirce
June 29, 2018


CMS increases reimbursements for complex patients according to study

Physicians who see patients with chronic and complex conditions often spend time outside the office visit engaging both with that patient and with other healthcare providers treating the patient. Until recently, those physicians were not reimbursed for the additional time they spent with chronically ill patients. However, a study recently conducted by the Urban Institute, and supported by the Robert Wood Johnson Foundation, explains that the Centers for Medicare & Medicaid Services (CMS) has initiated new primary care billing codes for physicians who care for patients with chronic conditions.

The report states that, “in creating this new billing code, CMS acknowledged that the existing payments for some patient visits did not provide sufficient compensation to cover all the prep and follow-up work required for such visits.” Recognizing that complex patients are costly – 69 percent of traditional Medicare beneficiaries have multiple chronic conditions, yet they generate 93 percent of Medicare spending – CMS is placing a higher priority on their care.

The shift to quality care requires primary care physicians to focus on outcomes, which also requires spending more time with complex patients. The new billing codes and demonstrations implemented by CMS allows the organization to: “(1) incentivize specific activities that the agency knows it wants clinicians to engage in (through billing codes), and (2) test whether it can achieve favorable outcomes by paying for promising new delivery reforms (through demonstrations),” according to the Urban Institute study.

The primary care-friendly billing codes are reflected in the final rule for the 2018 Medicare Physician Fee Schedule (PFS). As the report states, “Medicare will now pay for time spent engaging in remote monitoring of patients’ physiological data (e.g., blood pressure, glucose; 99091) and for a variety of telehealth services (e.g., caregiver health risk assessments [96161], care planning for chronic care management [G0506], and interacting with complex patients [90785]).”

Sam Peirce
May 29, 2018