Revenue Cycle Management Blog | GroupOne Health Source

MACRA: New Opportunites for Medicare Providers with Alternative Payment Models

Written by Jeff Jones, CPHP | May 26, 2016

With the repeal of Medicare's sustainable growth rate formula also came the opportunity for physicians to eventually leave the traditional Medicare fee-for-service system behind. The shift from fee-for-service to value based reimbursement is a new opportunity for physicians but with it comes some challenges in understanding how it will work. The final rule, released on Oct. 14th, details how Alternative Payment Models (APM) will enhance or replace some of the current fee-for-service payments with a patient-level payment not related to volume or intensity.

APMs and Advanced APMs: What's the Difference?

There are two different types of Alternative Payment Models - APMs and Advanced APMs. 

Alternative Payment Model

Alternative Payment Models are new approaches to paying for medical care through Medicare that incentivize quality and value. MACRA does not change how any particular APM functions or rewards value. Instead, it creates extra incentives for APM participation. Keep in mind that participation in an APM, which is not deemed an Advanced APM, still requires that the clinician(s) participate in MIPS. Participating in an Alternative Payment Model still delivers APM specific rewards and also results in favorable scoring in certain MIPS categories.

Advanced Alternative Payment Model

Advanced APMs are value-based payment programs operated by CMS which meet minimum requirements for the use of certified EHR technology, quality measurement, and the level of financial risk placed upon clinicians. These minimum requirements distinguish Advanced APMs from APMs

Qualifying participants in Advanced APMs can earn an annual 5% Part B incentive (paid 2019 – 2024) and are exempt from the Merit Based Incentive Payment System (MIPS). In addition, starting in 2026, Advanced APM qualifying participants will accrue a higher annual Part B physician fee schedule (PFS) increase of 0.75%, rather than 0.25%.

In order to qualify for the 5% APM incentive payment for participating in an Advanced APM during a payment year, you must receive a certain percentage of payments for covered professional services or see a certain percentage of patients through the Advanced APM during the associated performance year. See the table below: Requirements for APM Incentive Payments for Participation in Advanced APMs (Clinicians must meet payment or patient requirements)

Both Advanced APMs and APMs offer greater rewards but also greater risks. Clinicians who implement any type of APMs take on direct financial risk, because if they do not meet their savings targets, they may have to repay the difference back to Medicare.

What APMs Will Qualify as Advanced APMs in 2017?

A key component of the final rule is that the only APMs that meet the minimum requirements for Advanced APMs and are operated by CMS will qualify as Advanced APMs in 2017, making this list fairly short:

  • Comprehensive ESRD Care (CEC) – Two-Sided Risk
  • Comprehensive Primary Care Plus (CPC+)
  • Next Generation ACO Model
  • Shared Savings Program – Track 2
  • Shared Savings Program – Track 3
  • Oncology Care Model (OCM) – Two-Sided Risk
  • Comprehensive Care for Joint Replacement (CJR) Payment Model (Track 1- CEHRT)
  • Vermont Medicare ACO Initiative (as part of the Vermont All-Payer ACO Model)

However, CMS is planning to expand on this list in 2018 and onward. This expansion will include the Medicare ACO Track 1+ Model, which will have more limited downside risk than in Tracks 2 or 3 of the Medicare Shared Savings Program in order to encourage more practices, especially small practices, to advance to performance-based risk. Furthermore, there will be new cardiac and orthopedic payment models that will begin in 2019 or potentially as early as 2018.

Where can I find more information?

Check out these resources from CMS for more information on MACRA.

Get the latest updates sent to you; join the Quality Payment Program list serv

Questions or Comments about MACRA?

Leave a comment below if you have a question regarding the proposed rule and how it will impact your practice. We will be publishing posts regularly to keep you updated on MACRA and providing further details about the Advanced Payment Models (APMs). 

Subscribe to updates today and receive notifications right to your inbox when these articles are published.