In a move that was widely applauded by medical groups such as the Medical Group Management Association, the American Medical Association, and the American Academy of Family Physicians, CMS announced that it is making the start of MACRA implementation more flexible next year. Although the performance evaluation period may be delayed, the start of payment changes will not be delayed.
Regardless of when you begin the performance evaluation period, you will be subject to payment changes in 2019. Our best advice is to continue with your preparation plans as if the announcement had not been made.
Our reasoning? Consider two options to delay implementation:
- Some hospitals and physician practices will not be able to comply with the Jan. 1, 2017 deadline. They can’t get ready for the new payment reform models such as the Merit-based Incentive Payment System (MIPS) or participation in an advanced alternative payment model, such as the Medicare Shared Savings Track 2 or 3, in time. With this announcement, they will get more time to prepare, and any data that they submit will forestall a negative payment adjustment.
- Likewise, some hospitals and physician practices that are farther along in the preparation for MACRA can choose to submit data for a reduced number of days instead of a full calendar year. Their first performance period could begin after Jan. 1, and they can still qualify for a small positive payment adjustment. For example, their submission could include information for selected quality measures, data corroborating that the practice is using technology, and details of improvement activities available under MIPS.
Although both of these options ensure you won’t receive a negative payment adjustment in 2019, they could reduce payments later in the process. Data collected in 2017 will be used to set payment adjustments in 2019. The goal of both options is to allow flexibility for hospitals and physician practices to ease into broader participation in the next two years.
The third option, we believe, is the wisest. Start your first evaluation period on time, on Jan. 1, 2017. Those hospitals and practices that are able to submit data for the full calendar year 2017 will receive complete credit for the year and could qualify for a positive payment adjustment in 2019.
MIPS is revenue-neutral, which means that there will be winners and losers. Those who don’t report could lose 4 percent of revenue in 2019. Those who can report and fall in the top decile could receive a 4 percent bonus. As more practices make improvements to their systems, it will become more difficult to achieve top scores. Getting an early start will help you establish a top-performing hospital or physician practice from the beginning.
The flexibility offered by CMS will allow hospitals and physician practices who are more prepared for MIPS to receive credit for their participation, while those who are less prepared will have an opportunity to enter the program at a slower pace and avoid penalties the first year. In addition, the delayed implementation only affects reporting requirements for 2017, so you should continue your preparations for MACRA implementation now.
We expect CMS to address potential conflicts in the final rule, expected in November, but we don’t expect major changes. Therefore, the work you undertake now will stand you in good stead as you move forward. The details may change, but we expect the overall move from volume to value, with an emphasis on high quality care and best outcomes for patients, to continue steadily.
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