A beginner’s guide to MACRA

Editor’s Note 10/31/2016 – Earlier this month, the Center for Medicare and Medicaid Services (CMS) issued MACRA’s QPP Program’s final rule, which goes into effect Jan. 1, 2017. Allscripts is committed to helping healthcare organizations stay ahead of these upcoming requirements. Join a webinar overview on MACRA QPP, updates from the final rule and what organizations should be doing now to prepare. Hospitals and health systems can click here to register, physician practices can click here to register. Read more here: MACRA 101: We have the final rule for the QPP…now what?

MACRA is perhaps the most significant piece of proposed healthcare regulation I’ve ever seen. We’ve had a series of webinars to help clients understand the key points, and distilled them here in a Q&A format.

What is MACRA?

MACRA stands for the Medicare Access and CHIP Reauthorization Act of 2015. It is Medicare payment reform designed to help lower the cost of health care, while delivering better quality and improving health outcomes. It creates a more comprehensive value-based framework for payment and combines different quality-based measures into one system.

Is MACRA final?

No. MACRA was enacted in April 2015, but a public comment period has been open from April through June 27, 2016. The government is estimating the final rule will be available in October 2016.

If it’s not final, why should I worry about this now?

MACRA includes many changes, and arguably the most critical impact is the introduction of a new payment model that will affect all providers. While 2019 is the official start date for the new payment models, 2017 will be the performance year that determines 2019 payment adjustments. Providers must start taking action now to be ready by the end of 2016.

What’s new about how MACRA will determine payments?

MACRA repealed the Sustainable Growth Rate (SGR) formula, which was a method based on outdated assumptions. This new distribution of quality payments offers providers two tracks to choose from: 1) Merit-based Incentive Payment System (MIPS) and 2) Alternative Payment Models (APMs).

The default track for all providers will be MIPS, which has lower incentives and is ultimately the less attractive option. The Centers for Medicare and Medicaid Services (CMS) anticipates initial participation to be 89% in MIPS and 11% in APMs. However, the tracks are designed to encourage increasing participation in the APM track.

How does the MIPS track work?

Providers that chose the MIPS track will earn a composite performance score based on four categories:

1) Quality of outcomes (50%) – These are familiar clinical quality measures, many the same as Physician Quality Reporting System (PQRS)

2) Cost of outcomes (10%) – No reporting is necessary, as it is measured solely on a claims basis.

3) Clinical Practice Improvement Activity (15%) – This is a new category focused on better processes in nine areas. Each activity has “all or nothing” scale for scoring.

4) Advancing Care Information/Use of Health IT (25%) – This is the most complicated category, because there are three types of scores in this category.

Scores in these four categories will translate into a 100-point scale MIPS score, which translates into a penalty or reward. The incentive/penalty bar will move each year based on national performance of participants. The more participants who do well, the lower the incentive, because this program is to remain budget neutral.

How does the APM track work?

Providers that chose the optional APM track are agreeing to higher risk and higher potential reward. This track is not a single model, but rather is a category of payment models that share assumed risk, provide financial benefit for achieving quality and requires sharing of information across care locations.

Only advanced APMs are eligible for MACRA, which currently includes Medicare Shared Savings Program (MSSP) Track 2 and Track 3, Next Generation Accountable Care Organizations (ACO), Comprehensive Primary Care Plus (CPC+), Comprehensive ESRD care Model (renal dialysis organizations), and an Organization Care Model available in 2018. Surprising omissions from this list include MSSP Track 1, Comprehensive Joint Replacement (CJR) and Patient-Centered Medical Homes.

These models require less investment up front, for the promise of greater rewards upon meeting certain milestones. They also require providers to bear more than a nominal financial risk. To be successful, providers may need to create new organizational systems for clinical and financial management to manage quality.

Help! What do all these acronyms mean?

We’ve compiled a list of “MACRAnyms” associated with this rule:

ACO – Accountable Care Organization, payment and care model based on quality metrics

APM – Alternative Payment Model, quality-based financial incentive structures for physician practices

AAPM – Advanced Alternative Payment Model, has higher levels of risk and reward which are required for MACRA participation

CHIP – Children’s Health Insurance Program, administered by states according to federal requirements

CJR – Comprehensive Joint Replacement, an alternative payment model not eligible for MACRA

CMS – The Centers for Medicare & Medicaid Services, part of the U.S. Department of Health and Human Services and covers 100 million people

CPC+ – Comprehensive Primary Care Plus, an advanced alternative payment model eligible for MACRA

EHR – Electronic Health Record

EC – Eligible clinicians, Medicare clinicians who participate in MACRA. ECs include EPs plus more clinician types (such as “mid-levels”).

EP – Eligible professional, people who can participate in CMS programs. In MACRA, this only refers to Medicaid professionals.

MACRA – Medicare Access and CHIP Reauthorization Act of 2015 to reform Medicare payment models

MIPS – Merit-based incentive payment system, created by MACRA to combine Meaningful Use, PQRS and VBM starting in 2017 performance year

MSSP – Medicare Shared Saving Program, a voluntary ACO model that rewards providers for quality

NPRM – Notice of Proposed Rule Making, public notice issued by law when the government intends to change a rule or regulation

ONC – Office of the National Coordinator for Health Information Technology, part of the U.S. Department of Health and Human Services dedicated to coordinating national health technology efforts. This entity issues certification standards.

QPP – Quality Payment Program, CMS financial models based on quality, rather than fee for service. MIPS and Advanced APMs are part of QPP.

PCMH – Patient-Centered Medical Home, a status recognized by a number of different organizations. Some will be eligible for MACRA as advanced APMs, but currently they only qualify for MIPS.

PQRS – Physician Quality Reporting System, CMS quality program which will be part of MIPS

SGR – Sustainable Growth Rate, a formula used to calculate payments and was repealed by MACRA

VBM – Value-Based Modifier, CMS claims-based cost quality program, which will be part of MIPS

What should I be doing now to prepare for MACRA?

MACRA’s impact is unique to each provider. The first step is to understand the proposed rule and how it may affect you. Allscripts offers webinars for clients that can help explain these programs in greater detail.

Again, while this rule will not be final until the fall, it is important to begin preparing for the changes ahead to be ready for the first performance year in 2017. Contact Allscripts Consulting  if you would like to schedule an introductory consultation on what this means for your organization.

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About the author

Former CIO / InfoSec Consultant / expert systems designer / Administrator for OB/GYN & OccMed practices / Family Therapist. Masters in Computer Science and Psychology; author of two books on artificial intelligence. In my "copious" free time I am a professional storyteller and inspirational speaker.

3 COMMENTS on A beginner’s guide to MACRA


Jimmy Wayne Dailey says:

06/30/2016 at 6:22 pm

Its really very simple. The requirements to qualify in 3 of the main categories, excluding “Cost of Outcomes” are so onerous, that a majority will fail. This is ultimately designed to push more consumers, and then providers, in to managed care Medicare Plans and then, ultimately, a single payer system. There is no economic or clinical data to support the requirements CMS is proposing. Second, the cost of compliance such as purchasing the latest CC HIT certified EHR, the software and hardware to support it, the costs of IT associated with the aforementioned, payroll for additional staff to monitor, collect, collate, and enter data, and finally, the payroll taxes associated with this FAR EXCEEDS any bonus you can collect. Not readily able to be calculated in to this ‘equation’ is PATIENT TIME lost due to the burdens of documentation.
Finally, the ‘clinical guidelines” that CMS will use will make Physicians (note I did not say providers) into mere technicians. Do the math, friends. I take traditional medicare and crossovers and cash. Most of my cash patients have Obamacare and can’t afford the deductibles. I am swamped and considering adding a second mid-level at this time. Resist this egregious usurpation of Physician’s rights as members of a free economy to be paid fairly for our services and resist this insidious guise of “quality of care” for what it really is – social(istic) change. JWD, MD Canton, Texas


    clarence gehris says:

    07/15/2016 at 11:52 am

    I agree completely with Dr. Dailey; our government, including the health-care related part is being run by people who either never spent a whole day taking care of sick patients or, if they did, didn’t like that line of work and instead sit around in conferences looking at data (the accuracy of which is debatable) and then come up with all these acronyms (MACRA, MIPS) by which our practices, be they private or institutional, have to live. The whole federal government is, it would seem, being run by incompetent people and the ultimate result is that healthcare gets more involved, complex, over-regulated and EXPENSIVE! None of these programs ever delivered the promised savings because practices and institutions become less efficient in the face of increased reporting, required purchases of EHR equipment, preapprovals, etc. As a Medicare recipient who is burdened with rapidly, explosively increasing prescription drug costs, I would LOVE to see the insurance companies, drug manufacturers, and pharmacy retail chains have to get pre-approval for increases in drug prices, the same way we have to get various surgeries, drugs, or other treatments pre-approved. My personal solution to the MACRA-mess will be to retire sooner than I wanted to because my costs to practice will soon exceed what I can net to take home.


Sherman Jew says:

10/25/2016 at 10:22 am

This initiative is quite complicated even for those who have a passion for numbers and measurement. Although I support assessing job performance in general, I am not happy to see the health care profession, particularly physicians, singled out for heightened scrutiny. I understand we need quality health care that yields desired outcomes without excessive cost; however, quality and cost issues aren’t just problems found in health care alone. If we are going to scrutinize work performance, cost-effectiveness with a complicated and extensive set of matrices at a national level, shouldn’t we include a number of sectors, including the government? I am simply asking for fair play and reasonable public policy that is not disproportionately burdensome to one group of professional practitioners.


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