MACRA: Important Updates and Clarifications

The following is a summary of new MACRA developments provided by our partner company, Strategic Health Care’s policy team. 

All Advanced APM Docs Should Expect a 5% Bonus

CMS told doctors in advanced alternative pay models — like MSSP Track 2 and Track 3, CPC+ and the Next Generation ACO — they all should expect 5% bonuses in the first year of the new pay system. “We predict that approximately 100% of eligible clinicians in the following Advanced APMs will be Qualifying APM Participants (QP) in performance year 2017 — meaning we predict they will be eligible to receive a 5% APM Incentive Payment in 2019,” states an update to CMS’ website on the Quality Payment Program. Click here for the CMS update.

MedPAC Makes Major MACRA Recommendations

The Medicare Payment Advisory Commission (MedPAC) released its June 2017 report to Congress and proposes redesigning the Merit-Based Incentive Payment System (MIPS) and strengthening advanced alternative payment models, the two pathways under MACRA that determine provider payment. We provide a summary of this section of the MedPAC repor below. To view the MedPAC report fact sheet, click here. To view the full report, click here.

MACRA Basics

  • The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) shifts the Medicare payment base from volume to value. CMS refers to the new physician payment system as the Quality Payment Program (QPP).
  • Providers have two pathways to participate: Advanced APMs or the MIPS. Providers with less than $30,000 in Medicare charges or fewer than 100 patients are exempt.
  • CMS sent letters to providers in May on MACRA participation status; click here to view.
  • For MIPS, the system assigns a score on a 100-point scale for the following categories: 1)Quality; 2) Practice Improvement Activities; 3) Resource Use (cost); and 4) Advancing Care Information (meaningful use). The cost category will not contribute to 2017 scores.



Avoid a Penalty


  • “Pick Your Pace” created in 2016 allows providers to “submit something” to CMS in 2017 to avoid a negative payment adjustment in 2019 — one quality measure or one performance activity, or the four to five required Advancing Care Information (ACI) measures.
  • According to CMS, “the minimum to report to avoid a negative payment adjustment is one measure, one time, for one patient.”



‘Non-Patient-Facing’ and Hospital-Based Clinician Exemptions


  • MACRA created the term ‘non-patient-facing’ for facility-based clinicians who bill 100 or fewer of the CMS list of ‘patient-facing’ CPT codes. To view the CPT codes, click here.
  • Facility-based clinicians lack substantial control over electronic health records (EHRs), and often are unable to engage in practice improvement activities with other stakeholders.
  • Non-patient-facing clinicians are exempt from the ACI category and only need to report on one high-weighted or two medium-weighted practice improvement activities.
  • Hospital-based clinicians are also exempt. Such clinicians are defined as providing at least 75% of services at “Place of Service” locations — hospital inpatient, hospital outpatient, or emergency departments.
  • Providers may apply for a yearly hardship exemption. For example, anesthesiologists could seek an exemption on the grounds they lack control of the EHR.


Group Reporting


  • MACRA makes allowances for those who choose to report as a group. For example, if you report as a group, and 75% of your group is non-patient-facing, CMS considers the group to be non-patient-facing.
  • This is advantageous for a group with a mix of providers which includes a minority of patient facing physicians. By reporting as a group in this situation, you eliminate the requirement to report the ACI category for the entire group, including the patient-facing physicians.


MedPAC’s Recommendations to Congress

  • As CMS has started implementing these two paths (MIPS and Advanced APMs), it has become clear, according to MedPAC, that MACRA sets up a complex system in which some signals to improve value may not be well-aligned. Although it is difficult to judge what program will eventually result, the Commission is concerned by the direction the program is taking.


  • MedPAC discusses an alternative model for MIPS, which would start with instituting a quality payment withholding for all services under the physician fee schedule (PFS). It would eliminate the current set of MIPS measures and instead rely on a much smaller set of population-based outcome measures. The proposed outcome measures would be calculated from claims or surveys and would thus minimize burdensome clinician reporting. Clinicians could earn the quality withhold back if they join a virtual group or an Advanced APM.


  • Currently, MACRA requires clinicians to reach a threshold of revenue through an Advanced APM to qualify for the five percent incentive payment, but the incentive payment is then calculated as a percentage of all of a clinician’s revenues. MedPAC discusses making the reward based solely on the revenue coming through the Advanced APM and would eliminate the threshold and instead make the incentive payment proportional to an Advanced APM involvement. This would create more equity and would serve as an incentive for clinicians to participate in an Advanced APMs.


  • MACRA creates a fund of $500 million per year for MIPS (2019-2024) to reward clinicians with “exceptional performance” on their MIPS scores. Moving this fund from MIPS to Advanced APMs would shift clinician incentives toward an Advanced APMs by making MIPS less attractive. MedPAC discusses using this money to fund an asymmetric risk corridor for two-sided-risk accountable care organizations (ACOs) that qualify as an Advanced APMs. They also lay out a possible design for an Advanced APM that would be more attractive to small practices that may be reluctant to take on a large amount of risk relative to their revenue.


  • Although Congress is not required to implement MedPAC recommendations, they are likely to motivate congressional action within the next 12 months (if not sooner).

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