CMS Merit Based Incentive Payment System (MIPS) in 60 Day Comment Period, Sunsetting of Meaningful Use

New Federal healthcare industry payment models, based on the April 27th release of a proposed rule, present MIPS, MACRA, and APM methods for calculating healthcare reimbursement. The document proposes once in a generation changes in how healthcare providers are paid.  The Meaningful Use program is eight years old while the Medicare payment system is 25 years old.  What follows is a summary of the proposed rule as of May 2016.

 CMS and other industry leaders generally believe that 30% of healthcare spending is still wasted. Hence, these changes continue the effort to achieve efficiency in healthcare.

CMS Proposed Rule-making on MIPS and MACRA

According to the Centers for Medicare and Medicaid (CMS), “Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) repeals the Medicare sustainable growth rate (SGR) methodology for updates to the physician fee schedule (PFS) and replaces it with a new Merit-based Incentive Payment System (MIPS) for MIPS eligible clinicians or groups under the PFS.” This proposed rule would establish the MIPS, a new program for certain Medicare-enrolled practitioners.

  • MIPS would combine parts of three existing programs: the Physician Quality Reporting System (PQRS), the Physician Value- based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) Incentive Program for Eligible Professionals (EPs).
  • It would continue the focus on quality, resource use, and use of certified EHR technology (CEHRT) in a cohesive program. As a result, it leads to an avoidance of excess.
  • Additionally, this proposed rule would put in place incentives for participation in alternative payment models (APMs). Furthermore, it includes proposed criteria for use by the Physician-Focused Payment Model Technical Advisory Committee (PTAC) in making comments and recommendations on physician-focused payment models.  (See HHS)

The Quality Payment Program and HHS Goals

The Secretary announced new goals which include 30% of payments based on alternate payment models by end of 2016. Additionally, the goal is to have 50% of payment tied to value based models by 2018.

health care value based payments illustrated
U.S. Health and Human Services Goals for Value Based Care.
Source: GE Healthcare IT.

MIPS – Fresh Start for Value Based Care

The goal is to measure E.H.R. usage under care coordination.  The entry ticket to MIPS is that providers are a Meaningful User of Electronic Health Records.

  • Quality
  • Resource Usage
  • Clinical Practice Improvement
  • Advancing Care Information

Expanded Participation

In years 1 and 2:

  • MD and DO.
  • DMD and DDS.
  • Physicians Assistants.
  • Nurse Practitioners.
  • Nurse specialists.
  • Certified registered nurse anesthetists.

The program may be broader and include:

  • Physical or occupational therapists.
  • Speech language pathologists.
  • Audiologists.
  • Nurse midwives.
  • Clinical social workers.
  • Clinical psychologists
  • Dietitians and nutritional professionals.

Who is Excluded from MIPS?

  • First year Medicare Part B providers
  • Below low patient volume threshold of less than $10,000 and provides care for 100 or fewer Medicare patients in one year.

CMS Policy and Performance Category Weights – Determined by Statute

The prioritization of performance is shown in the graph below.  A MIPS Advancing Care Information Performance Category total score would be composed of:

  • Base score of 50 points for advancing care information
  • 80 points for advancing care information performance
  • 1 point for total advancing care information performance – bonus
  • Which equates to a composite score of 100 points or more possible

There is a proposal to end clinical decision support and clinical provider order entry (CPOE) goals, which are more basic measures of the current Meaningful Use program.  The new measures focus more on advanced usage of E.H.R. technology.

health care delivery performance category weights
Source: GE Healthcare IT

Risk Adjustment Mechanisms for Value Based Care – Stay Tuned

There are no firm commitments from CMS but we can expect changes to Risk Adjustment methods in the future.

The Affordable Care Act (ACA) provides for a program of risk adjustment in the individual and small group markets in 2014 while Marketplaces are put in place and new market reforms take effect. The purpose of risk adjustment is to lessen or end the influence of risk selection on the premiums that plans charge.

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Michael F. Arrigo

Michael is Managing Partner & CEO of No World Borders, a leading healthcare management and IT consulting firm. He serves as an expert witness in Federal and State Court and was recently ruled as an expert by a 9th Circuit Federal Judge. He serves as a patent expert witness on intellectual property disputes, both as a Technical Expert and a Damages expert. His vision for the firm is to continue acquisition of skills and technology that support the intersection of clinical data and administrative health data where the eligibility for medically necessary care is determined. He leads a team that provides litigation consulting as well as advisory regarding medical coding, medical billing, medical bill review and HIPAA Privacy and Security best practices for healthcare clients, Meaningful Use of Electronic Health Records. He advises legal teams as an expert witness in HIPAA Privacy and Security, medical coding and billing and usual and customary cost of care, the Affordable Care Act and benefits enrollment, white collar crime, False Claims Act, Anti-Kickback, Stark Law, physician compensation, Insurance bad faith, payor-provider disputes, ERISA plan-third-party administrator disputes, third-party liability, and the Medicare Secondary Payer Act (MSPA) MMSEA Section 111 reporting. He uses these skills in disputes regarding the valuation of pharmaceuticals and drug costs and in the review and audit of pain management and opioid prescribers under state Standards and the Controlled Substances Act. He consults to venture capital and private equity firms on mHealth, Cloud Computing in Healthcare, and Software as a Service. He advises ERISA self-insured employers on cost of care and regulations. Arrigo was recently retained by the U.S. Department of Justice (DOJ) regarding a significant false claims act investigation. He has provided opinions on over $1 billion in health care claims and due diligence on over $8 billion in healthcare mergers and acquisitions. Education: UC Irvine - Economics and Computer Science, University of Southern California - Business, studies at Stanford Medical School - Biomedical Informatics, studies at Harvard Medical School - Bioethics. Trained in over 10 medical specialties in medical billing and coding. Trained by U.S. Patent and Trademark Office (USPTO) and PTAB Judges on patent statutes, rules and case law (as a non-attorney to better advise clients on Technical and Damages aspects of patent construction and claims). Mr. Arrigo has been interviewed quoted in the Wall Street Journal, New York Times, and National Public Radio, Fortune, KNX 1070 Radio, Kaiser Health News, NBC Television News, The Capitol Forum and other media outlets. See and for more about the company.

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