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.

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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.

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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 Arrigo brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health IT, and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations who provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and medical billing, fraud damages, as well as electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, medical malpractice, insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software SA (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls IT audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and is published in Healthcare IT News.

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