All Medicare stakeholders need to know MACRA

Although the Medicare Access and CHIP Reauthorization Act (MACRA) (P.L. 114-10) is best known for changing Medicare provider payments, its true goal is improving the quality of care delivery across the health spectrum. As a result, according to Todd Gower and Lisa Alfieri from the Risk Transformation, Health compliance sector of EY, providers must enhance their relationships and contracts with providers. Gower and Alfieri, speaking at a Health Care Compliance Association (HCCA) webinar titled “MACRA: Not just for Providers,” explained that having the proper infrastructure to obtain and organize all necessary documentation is the key to surviving MACRA.

Gower and Alfieri stressed the need for new discussions within health systems, noting that MACRA has potential to transform the health care system “equally, if not far more” than the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). As it implements MACRA, HHS is having new conversations with stakeholders including whether the shared risk will actually improve care, and whether the current proposed criteria (see Halfway through QPP ‘transition year,’ CMS proposes substantial changes , June 21, 2017) are too restrictive. They praised HHS’ website on the Quality Payment Program as a new way to communicate with providers and other stakeholders.

MACRA is a complex law with wide-reaching repercussions. Gower and Alfieri suggested infrastructure updates, and predicted that the most-advanced providers will be seeking commercial payer partners by 2019 to maximize incentives for value-based care (VBC) payment models. Therefore, payers should create or enhance existing VBC offerings now to meet that expected need. MACRA steering committees are important to ensure compliance and update risk management programs for providers, but also for non-provider groups.

Wait! Physicians are not ready for the QPP

Physicians expressed concern over their knowledge of and preparedness for Medicare’s Quality Payment Program (QPP) in a recent American Medical Association (AMA) and KPMG consulting survey. Only 10 percent of responding physicians expressed feeling deeply knowledgeable about the Medicare Access and Chip Reauthorization Act (MACRA) (P.L. 114-10) or the QPP and 90 percent of respondents indicated that they find the requirements of MACRA’s merit based incentive payment system (MIPS) to be slightly or very burdensome.

QPP

MACRA created the QPP, which, in January 2017, began marking the quality performance of physicians. In 2019, the program will make adjustments to physician payments under one of two tracks: (1) MIPS or (2) a 5 percent lump sum bonus payment if the physician has a threshold percentage of patients or revenue in an advanced alternative payment model (Advanced APM). Because little is known about physician preparation under the program, the AMA and KPMG conducted a survey to gauge physician readiness and knowledge. The survey of 1000 physicians was conducted between April 25 and May 1, 2017, prior to proposed updates to the QPP program released on June 30, 2017 (see Halfway through QPP ‘transition year,’ CMS proposes substantial changes, June 30, 2017).

Findings 

Only 51 percent of physicians expressed feeling somewhat knowledgeable about MACRA and the QPP. Seven in 10 respondents have begun preparation for QPP in 2017, however, of those respondents preparing for MIPS in 2018, only 65 percent reported feeling prepared. The vast majority of respondents—90 percent—indicated that they found MIPS’ requirements burdensome. The cause of that burden, for most respondents, was the time and cost associated with reporting. Physicians expressed specific concerns regarding the unknown financial ramifications of the program, with only 8 percent of respondents indicating they were very prepared for long-term financial success under the program.

Impact

The AMA and KPMG survey concluded that some impacts—time and complexity of reporting—impact physicians regardless of practice size, specialty, or previous reporting experience. Additionally, physicians across practice areas agree that long-term financial impacts remain uncertain and that the program would benefit from more APMs.

House Committee urged to extend funding for federal safety net programs

Extend funding for the Children’s Health Insurance Program (CHIP) to ensure continuity of coverage for children, particularly in light of the current uncertainty surrounding other sources of health coverage in the U.S., witnesses urged at a House Committee on Energy and Commerce hearing titled “Examining the Extension of Safety Net Health Programs.” The purpose of the hearing was to examine the extension of funding for two federal safety net health programs that provide health care and coverage for low-income adults and children, CHIP and the Community Health Center Fund (CHCF).

CHIP

CHIP is a program that provides health coverage to targeted low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but have no health insurance. It is jointly financed by the federal government and states, and the states are responsible for administering the program. A memo from the committee majority staff states that in fiscal year (FY) 2015, 8.4 million children received CHIP-funded coverage.

Section 2101 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) increased the CHIP enhanced federal medical assistance percentage (E-FMAP), which varies by state, by 23 percent from October 1, 2013 through September 30, 2019. Since the ACA did not include additional or extended funding for CHIP, MACRA extended funding through September 30, 2017. The Medicaid and CHIP Express Lane Option, Child Enrollment Contingency Fund, CHIP Qualifying State Option, and CHIP Outreach and Enrollment Grants also expire September 30, 2017.

At the hearing, Cindy Mann, partner at Manatt, Phelps & Phillips, touted the success of CHIP, which covers 8.9 million children nationwide. She stated that Congress must consider the overall level of funding for CHIP, in addition to the E-FMAP funds, which “are now fully integrated into states’ budgets and a key source of funding for sustaining CHIP.” She said that Congressional action is needed as soon as possible to ensure program continuity, budget certainty for states, and stable coverage for children, particularly those with special health care needs. She urged a five-year extension instead of two to provide needed stability (see Extend CHIP, protect DSH payments, MACPAC tells Congress, March 16, 2017).

Jami Snyder, Director of the Medicaid and CHIP programs for the state of Texas, noted that a decision to not reauthorize the CHIP program would result in a loss of over $1 billion in annual funding to the state of Texas and a loss of coverage for more than 380,000 Texas children.

Health Center Program

The Health Resources and Services Administration’s (HRSA) Health Center Program, authorized under Section 330 of the Public Health Service Act, awards grants to federally qualified health centers (FQHCs). The program is supported by discretionary appropriations and the CHCF, a mandatory multibillion-dollar fund established by Section 10503 of the ACA. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (P.L. 114-10) extended funding through fiscal year 2017. According to the staff memo, the CHCF represents over 70 percent of the Health Center Program’s FY 2016 funding.

Michael Holmes, the chief executive officer of Cook Area Health Services, an FQHC in Minnesota, testified that as a result of CHCF investments new FQHC were added in more than 1,100 communities. With the extension nearing its expiration date, he “strongly urged” Congress to renew funding for at least five years to allow FQHCs to provide a stable and reliable source of access to patients and recruit and retain a comprehensive health care workforce.

CMS moves ahead with new Medicare cards

CMS is moving forward with its fraud prevention initiative to remove Social Security numbers from Medicare cards. New cards issued under the program will omit the Social Security numbers of Medicare beneficiaries and, instead, use a unique, randomly-assigned number called a Medicare Beneficiary Identifier (MBI). The new cards will be shipped by CMS beginning April 2018.

Transition

The MBI will be based upon the Health Insurance Claim Number (HICN) currently used on Medicare cards. The use of an MBI in place of a Social Security number is designed to reduce both identity theft and the illegal use of Medicare benefits. The MBI will allow providers to identify beneficiaries using secure access tools. To ensure a smooth transition, there will be a 21-month overlap period where either the MBI or the HICN will be effective for looking up a beneficiary. As part of the transition, beneficiaries will be instructed how to safely and securely destroy their existing Medicare and keep their MBI confidential. The new cards will have no impact on the benefits beneficiaries receive.

Identify theft

The new Medicare card initiative was brought upon by requirements contained in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (P.L. 114-10). The initiative is important in light of the increase in the occurrence of identity theft. Between 2012 and 2014, identify thefts among individuals 65 and older increased from 2.1 million to 2.6 million. According to CMS, two-thirds of identity theft victims report a direct financial loss.