CMS releases final rule implementing MACRA

In the agencies

On Oct. 14, the Centers for Medicare and Medicaid Services (CMS) released the final rule governing the Medicare Quality Payment Program, which finalizes the policy of the Merit-Based Payment System (MIPS) and the Advanced Alternative Payment Model (APM) under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). Under the final rule, CMS is creating a 90-day reporting period for clinicians participating in MIPS and reducing the number of mandated measures to be reported from eleven to five.

The final rule also outlines CMS’s “pick-your-pace” path to MIPS reporting. In 2017, physicians will now be allowed to participate either for the whole year or for just a portion of the year while still being able to avoid the negative payment adjustment that non-participants in the program will receive. The various manners in which participants can earn bonuses are outlined in the rule, including extra bonuses for “exceptional performers.” These “exceptional performers” will be eligible to receive an additional bonus, on top of the already basic bonus under the program, for each of the first six years of the program.

CMS is also reporting that this final rule has more flexibility than the proposed version and therefore the agency is expecting an increase in program participation rates. CMS estimates that roughly 70,000 to 120,000 clinicians will be qualified participants in APMs. This is an increase from the 30,000 to 90,000 estimated under the proposed rule provisions. The number is expected to grow to around 120,000 to 250,000 in 2018. Under the final rule CMS is also allowing physicians more options to participate in alternative payment models, including through an ACO Track 1+, which has lower levels of risk than traditional ACOs.

On Oct. 13, CMS announced a new initiative aimed at improving clinicians’ experience in the Medicare program and implementing delivery systems from the Affordable Care Act and MACRA. CMS Acting Administrator Andy Slavitt called it “a nationwide effort to work with the clinician community to improve Medicare regulations, policies and interaction points to address issues.” Under the new initiative, providers using specified APMs will be relieved of certain medical review programs. Following the results of the pilot, “CMS will consider expansion along various dimensions including additional Advanced APMs, specialties and provider types.”

According to CMS, nearly 70 percent of Medicare Advantage customers will be on plans that receive at least four stars in quality ratings by 2017. The number of private Medicare Advantage customers who had signed up for plans with at least four stars was just over 50 percent in 2014. Medicare Advantage plans that receive four stars or more are eligible for bonus payments, and those receiving fewer stars face possible elimination from the program. An expected 18.5 million individuals will be enrolled in private Medicare plans next year, which represents a third of all beneficiaries.

On the Hill

A newly released Government Accountability Office (GAO) report from House Democrats has called for CMS to improve the accessibility and reliability of expenditure data for skilled nursing facilities. The report comes after concerns were raised regarding the difficulty many faced in accessing spending data for direct and indirect care for patients. Under the Affordable Care Act the data is required to be available to consumers. The report found that the data was difficult to access and self-reported data was not guaranteed to be accurate. It also discovered the average direct and indirect spending was lower for for-profit nursing facilities compared to not-for-profit and government facilities. Average for-profit margins were also higher.

The Congressional Budget Office (CBO) has evaluated a House bill that would prevent the implementation of a proposed new program by the CMS Innovation Center which is aimed at lowering payments for drugs under Medicare Part B. The new program, revealed in a proposed rule, would reform how Medicare pays for physician administered drugs, and according to CBO halting the program would cost the government $395 million over ten years. The proposed rule, if implemented, would alter the payment formula to incentivize the use of lower cost drugs, followed by an array of value-based payment models. CMS is revising the proposed rule following push back from Congress and threats from Republicans to block the mandatory, nationwide demonstration project.

In the courts

Two former American Senior Communities (ASC) executives in Indiana have been indicted on charges that they defrauded Medicare, Medicaid and ASC out of $16 million. James Burkhart and Daniel Benson, ASC’s former CEO and COO, respectively, are accused of overcharging vendors for services and pocketing the difference. Burkhart and Benson used over 20 shell companies and bank accounts to commit the nursing home fraud, according to the Department of Justice, which charged them each with one count of conspiracy to commit mail, wire and health care fraud and other charges of mail fraud and money laundering. The men, without ASC knowledge, reached side deals with vendors willing to deposit the funds into the shell companies and filed false claims with the government.

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