HAP Comments - MIPS and APM Incentives Under the Physician Fee Schedule and Criteria for Physician-Focused Payment Models
In April of 2015, H.R. 2, the Medicare Access and CHIP Reauthorization Act of 2015 became law. This act, known
as MACRA, permanently repealed the sustainable growth rate (SGR) formula and made reforms to Medicare physician
payments intended to encourage quality and value.
This legislation called for a new Quality Payment Program (QPP), which is intended to transition providers
from Medicare payments based on volume to payments based on value.
The QPP is comprised of two paths:
- MIPS—requires performance measures, data submission mechanisms, reporting timeframes, scoring
methodology, and various administrative processes. It also would replace electronic health record meaningful use
requirements for physicians with a more flexible set of “advancing care information” measures.
- APMs—requires that an entity participating in an eligible APM bear financial risk for any excess
Medicare spending over projected expenditures, or be a specified medical home. For 2019 APM incentive payments,
eligible models based on financial risk would be Tracks 2 and 3 of the Medicare Shared Savings Program, the Next
Generation ACO model, the Comprehensive End-stage Renal Disease Care model, and the two-sided risk model in the
Oncology Care program. The newly-announced Comprehensive Primary Care Plus initiative would qualify as a medical
Payment under these models does not begin until 2019, though measurement for the MIPS programs begins in
The Merit-Based Incentive Payment System
MIPS essentially consolidates three existing physician payment programs: the Physician Quality Reporting
System (PQRS), the Physicians Value-based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR)
Incentive Program. Under the new program, there are four performance categories:
|Clinical Practice Improvement Activities (CPIA)
|Advancing Care Information (ACI)
Impact of Budget Neutrality—MIPS Model
On page 676 of the 962-page proposed rule, CMS estimates that during 2019, for the first payment year of the
- 87 percent of eligible solo practitioners will be subject to a negative payment adjustment
- 70 percent of practices with two to nine physicians are estimated to have negative payment adjustments
- 59 percent of practices with 10 to 24 clinicians are estimated to have negative payment adjustments
While CMS appears to recognize the challenges of small practices and has outlined specific “flexibilities
and supports” for small practices in a fact sheet, HAP urges CMS to continue to review and refine its approach to
ensure that small practices, such as those associated with rural or critical access hospitals, are not unfairly
penalized under the new QPP.
MIPS Performance Categories
The quality performance category of the MIPS program as proposed is a combination of existing programs: the
Physician Quality Reporting System (PQRS), the Value-Based Payment Modifier (VM), and the EHR Incentive
Providers in Pennsylvania currently are experiencing a proliferation of quality metrics across various payer
programs. Commercial payers already have begun introducing programs and initiatives to move hospitals and health
systems along the continuum of volume to value and each payer includes a unique set of quality metrics.
In addition to federal and commercial initiatives, in October, the Pennsylvania Department of Human Services
(DHS) issued a Request for Proposal (RFP) to re-procure its physical health managed care program. The RFP
includes a number of program changes including setting targets for value-based payments as a percentage of total
contract value, which would begin in 2017, with a target of 7.5 percent increasing over the term of the contract
to 30 percent by 2019. “Value-based” payments would be defined in the contract, and could include financial
incentives around accountable care organization (ACO) models, gainsharing, episodes of care, primary medical
homes, and bundled payments, among others. These changes could potentially create additional sets of varying
quality metrics for providers to manage.
HAP urges CMS to streamline the quality metrics associated with all of its initiatives to focus on a core,
manageable set of measures that are nationally endorsed and not resource intensive and overly burdensome to
administer. This recommendation includes aligning hospital and physician measures and focusing on high-priority
measures with the greatest opportunity to promote successful outcomes.
The proposed rule requires providers to choose to report six measures rather than nine measures in the current
PQRS program. One of these measures must be an outcome measure or a high-quality measure, and one must be a
crosscutting measure. Clinicians also can choose to report a specialty measure set.
Large multi-specialty practices will likely be challenged in defining what measures the practice should focus on
HAP supports CMS’ initiative to simplify quality measurement by reducing the overall number of quality
measures. HAP urges CMS to continue to simplify the program as it remains too complex, especially in the early
years of transitioning providers from volume to value.
HAP also encourages CMS to better align the measurement period with the payment year. Current programs are
structured with a gap of two years between measurement and payment, which hinders physicians’ ability to benefit
from their quality improvement efforts.
HAP believes risk adjustments, including consideration for socioeconomic/ demographic factors in setting targets
for quality metrics in the MIPS program, is essential to ensure providers are not unfairly penalized for patients
negatively affected by social determinants of health.
- Resource Use
Performance in the resource use category is based on the average score of over 40 resource use measures including
total cost per capita, Medicare spending per beneficiary (MSPB), and clinical condition and treatment episode
measures. The measures are all calculated utilizing claims. Providers must have at least 20 cases to be scored
for performance on a measure.
While the total cost per capita and the MSPB measures are adjusted using a process known as “payment
standardization,” which removes the effects of geographic variations in payment and add-on payments and includes
a clinical risk adjustment, they do not include socioeconomic adjustments. HAP urges CMS to analyze the impact
of socioeconomic factors and incorporate adjustments as needed.
The clinical condition and treatment episode measures (approximately 40 condition-specific episodes of care) have
not been utilized in performance scoring in previous CMS payment programs such as the VM program. HAP
encourages CMS to delay implementation of the clinical condition and treatment episode measures until they have
been fully vetted, including providing assurance that an appropriate ICD-10 crosswalk has been
- Clinical Practice Improvement Areas (CPIA)
The CPIAs performance category is a new category in the MIPS program. This category will measure activities
related to improving clinical practice or care delivery in ways that are likely to improve outcomes. CPIAs
include activities such as expanded practice access, population management, care coordination, beneficiary
engagement, patient safety and practice assessment, and participation in an APM. Activities are designated as
high or medium weights and are worth different amounts of points, 20 and 10 respectively. Participation in a
certified patient-centered medical home provides for full credit in this category, however, participation in an
APM provides for only partial credit.
HAP urges CMS to simplify the measure by removing the high and medium distinction and to lower the year one
maximum points from 60 to 30.
- Advancing Care Information (ACI)
ACI, formerly known as meaningful use, measures providers who possess a certified EHR, use the functionality of a
certified EHR, and report on objectives and measures specified for the ACI performance category over a specified
The provider community is committed to furthering care improvement, care coordination, and new care models by
utilizing certified EHR technology.
HAP appreciates the proposed flexibility within the ACI performance category. However, HAP remains concerned
that it still contains a high degree of complexity and providers will not have sufficient time to report on a
full year beginning January 1, 2017. HAP recommends that CMS offer a reporting period of 90 days for calendar
HAP also recommends that CMS accelerate efforts to align the provider and hospital communities on the use of EHRs
and the exchange of health information under the Medicare and Medicaid EHR Incentive Program.
Hospital-based physician participation
MACRA allows for CMS to develop a hospital-based physician MIPS participation option using the physician’s
hospital’s CMS quality and resource use measures.
HAP supports immediate efforts to develop programs for hospital-based physicians to further align hospitals
and physicians in meeting the goals of the triple aim. HAP recommends that CMS require all physicians and groups
to self-designate whether they qualify as hospital-based as this option may not be appropriate for all hospitals
and all hospital-based providers in the MIPS. HAP also urges CMS to investigate all measures from CMS’ hospital
quality reporting and pay-for-performance programs for use in hospital-based physician reporting options to
ensure that a wide variety of specialties would have the ability to use the option.
Alternative Payment Models
The proposed rule stipulates that payment models must meet three criteria to qualify as an advanced payment
- Base payment on quality measures comparable to those in MIPS
- Require use of certified EHR technology
- Either (1) bear more than nominal financial risk for monetary losses or (2) be a medical home model expanded
under CMMI authority
HAP supports the effort to align quality measures across the MIPS and APMs. However, HAP urges CMS to
broaden the definition of nominal risk to account for the significant up-front investments that providers must
make to participate and be successful in the APMs. This investment exists even in upside-only models.
Qualifying Advanced APM models
MACRA promotes and provides incentives for providers participating in advanced APMs beginning in 2019. The
proposed rule includes a list of models that qualify as advanced APMs for the first performance year. They
- Comprehensive end-stage renal disease care model
- Comprehensive primary care plus
- Medicare shared savings program (MSSP)–tracks two and three
- Next generation ACO model
- Oncology care model two-sided risk arrangement
CMS notes that this list will be updated annually to add new payment models as they continue to develop.
It is estimated that approximately 30,000 to 90,000 providers will qualify to participate in the APM track in
CMS has clearly stated that one goal of MACRA is to shift providers to APM-like models. The current proposal
severely limits the number of qualifying providers. Recent models that were introduced by CMS, such as the
Medicare Shared Savings Programs (MSSP) track one required a minimum commitment of three years. Early adopters of
these programs are not permitted to change tracks due to the three-year commitment. HAP urges CMS to consider
the broadening of the year one definition to include CMS-designed programs such as the Bundled Payments for Care
Improvement (BPCI) initiative, Medicare Shared Savings Programs (MSSP) track one, and the recently implemented
Comprehensive Care for Joint Replacement (CJR) model.
While CMS attempted to provide a glide path for providers participating in APMs that do not qualify as advance
APMs, providers will still be required to split their efforts between the MIPS program and obtaining success in
HAP urges CMS to reconsider the benefits offered to providers that will be participating in both programs
and safeguard that those benefits reduce administrative burden and ensure alignment so provider efforts can be
focused rather than divided.
Qualifying Volume to Participate in Advanced APMs
In order to qualify for incentive payments under APMs, a significant portion of their business must be through
the Advanced APM. Providers have two options to qualify, including the percentage of payment through an Advanced
APM and the percentage of patients through an APM.
CMS also proposes to allow providers to be assessed individually or as part of a group.
HAP commends CMS for considering both the percentage of payments from an APM as well as patient counts from
an APM and using the measurement that is most favorable to allow the provider to qualify for participation. Using
both methods will alleviate unintended consequences such as the impact of successful APMs lowering costs/payments
over time, which may decrease the amount of Medicare payments for those patients attributed to the APM. This also
would help if there are significant changes in the attributed population over the measurement year. HAP also
supports the flexibility to be assessed as part of a group to meet the requirements of APM participation.
This proposed rule will have a significant impact on professional payments beginning in 2019 based on
performance measurement beginning January 1, 2017. The final rule will not be issued likely until November 2016.
This provides for limited time to make significant changes to operations, data reporting and analysis, IT
systems, etc. HAP urges CMS to consider the significant “lift” this rule requires for providers, monitor the
readiness of the field to implement MACRA, and be willing to provide appropriate flexibility in the timeline to
allow for a successful implementation.
New payment models introduced by CMS require extensive collaboration across the health care continuum. As
these models hasten the shift from volume to value, antiquated rules and regulations, once necessary in the fee-
for-service world, have become barriers to providers’ ability to succeed in these models.
HAP urges CMS to work in collaboration with other agencies and Congress to identify and remove legal and
regulatory barriers to clinical integration. These barriers include the Stark Law, the anti-kickback statute, and
the applicable civil monetary penalties. HAP also encourages CMS to continuously evaluate policies for their
impact on providers’ ability to work together to better the health of the population for which they
# # #