What is MACRA? Presently providers are reimbursed on a fee for service basis. Fees that are determined by the SGR formula or Sustainable Growth Rate. MACRA (Medicare Access and CHIP Reauthorization Act) CHIP (Children’s Health Insurance Program) bottom line is the government wanting to reimburse providers based on their quality of care, not quantity. Physicians will no longer be reimbursed based on volume of patients but on the value of care.

MACRA’s implementation will begin in 2019 but will be based on the reporting year 2017. So, even though implementation is a few years down the road the data used to determine a providers fee schedule will be based on what is reported in 2017 which is only a few months away. MACRA will allow each provider to have an individual fee schedule based on performance. Under MACRA providers will have two options:

Option 1: MIPS or Merit Based Incentive Payment System. MIPS combines parts of PQRS, VM, and HER incentive program into one program. Most physicians will be reimbursed based on MIPS.

Option 2: APM or Alternative Payment Model. APM provides ways to pay health care providers for the care they give to Medicare beneficiaries by sharing the risk. Accountable Care Organizations (ACO’s), and bundled payment models are examples of APMs. From 2019-2024 health care providers that qualify for APMs will receive a lump-sum incentive payment.

There are four components of MIPS:

1. Quality – PQRS (50%)
2. Advancing Care Information (ACI previously known as HER/meaningful use) (25%)
3. Clinical Practice Improvement Activities (CPIA) (15%)
4. Resource Use (10%)

MIPS defines the financial impact on providers by creating a composite score for each provider. The composite score will be between 1 and 100 and based on the 4 components above. Composite scores will be posted on a CMS public website known as Physician Compare.

Providers not reporting PQRS measures now receive a 2% penalty. Once MACRA is implemented PQRS could have a big impact on a providers reimbursement as the PQRS portion of the score is 50%.

Currently meaningful use is an all or nothing program. Under MACRA, MU or ACI it will no longer be all or nothing. Under MACRA ACI will account for up to 25% of a providers composite score, the provider will receive credit for the amount of MU they demonstrate. The higher the providers composite score the more they will be reimbursed for services provided to Medicare beneficiaries.

It is important for providers to prepare NOW so that their reported information in 2017 will not hurt their income in 2019. Many providers are still not reporting through the PQRS system or demonstrating MU. The current penalty does not impact them enough to make a difference. With MACRA PQRS and MU will count for up to 75% of the composite score and won’t be as easily ignored.

It is imperative for providers to exercise financial prudence and start preparing now so that you’re not surprised in 2019 when revenues are harshly impacted.

And…as always Take Advantage for all your medical billing needs.

Orthopedist Michael Reilly believes the surge of doctors going to work for hospitals is not a healthy trend. He had a firsthand view of what can happen

There is no delay coming, but for one year after Oct. 1, CMS will pay for all claims that don’t have the correct ICD-10 codes as long as the codes used are in the ballpark. This is the biggest of several concessions CMS is making in light of the Oct. 1 deadline and the grave concerns providers have expressed with compliance. These measures will “allow for flexibility in the claims auditing and quality reporting process as the medical community gains experience using the new ICD-10 code set,” CMS said yesterday in a joint press release with the AMA.
It’s not a delay, but it is perhaps the most CMS could do short of continuing to accept ICD-9 claims after Oct. 1. Here’s a breakdown on the specific terms CMS announced.
• No claim denials. For the first year of ICD-10, from Oct. 1, 2015 to Oct. 1, 2016, Medicare claims will not be denied if the only problem was the use of inaccurate diagnosis codes. Any claim with ICD-10 codes in the appropriate family will be accepted and paid. Claims with ICD-9 codes will be not be accepted on or after Oct. 1, 2015.
• No ICD-10 audits. Medicare claims will not be audited based on the accuracy of ICD-10 diagnosis codes as long as they are from the appropriate family of codes. The idea is to give providers time to become familiar with the ICD-10 codes they’ll use, CMS said. Both Medicare carriers and Recovery Audit Contractors (RACs) will abide by this rule.
• No quality reporting penalties. Like the change to claim denials, CMS won’t penalize physicians under the Physician Quality Reporting System (PQRS), the value-based payment modifier, or the meaningful use program based on the specificity of diagnosis codes as long as codes from the correct ICD-10 family of codes are used
• Payment disruptions. If Medicare carriers have trouble processing claims because of the ICD-10 transition, CMS will allow advance payments to physicians.
• More communication. To stay on top of ICD-10 transition issues, CMS will create a special communications center to track problems during and after the run-up to October. A specific “ICD-10 ombudsman” will be named to sort through physician provider concerns and problems.
With only three months remaining before the ICD-10 deadline, these changes by CMS are the result of coordinated, even frenzied lobbying by physician groups, which, once assured that ICD-10 would not be delayed, pushed for some way to relax its potential financial impact.

“These provisions are a culmination of vigorous efforts to convince the agency of the need for a transition period to avoid financial disruptions during this time of tremendous change”, said AMA president Steven Stack, MD, in a statement. “These provisions are a testament to the power of organized medicine and what we can achieve when we band together for the food of our patients and our profession.”

Last evening, by a vote of 92 – 8 the Senate passed H.R. 2, legislation that would permanently repeal and replace the Medicare Sustainable Growth Rate formula (SGR). The six amendments offered during floor consideration were all defeated. The the Senate has passed the bill in the identical form as the House passed version. This means that the bill can immediately go to the President for his signature. The President has previously agreed to sign this bill into law.
Once signed into law by the President, this bill immediately repeals the SGR, retroactive to April 1st therefore averting a 21% reduction in Medicare fee-for-service (FFS) payments to providers. It replaces the SGR with a new payment system that includes automatic payment updates for physician fee schedule payments for five years, transitions Medicare FFS payments towards a value-based payment system and incentivizes the development and participation in new, alternative payment models, among other noteworthy provisions.

In an effort to minimize financial effects on providers, CMS previously instituted a 10-business day processing hold for all impacted claims with dates of service April 1, 2015, and later. While the Medicare Administrative Contractors (MACs) have been instructed to implement the rates in the legislation, a small volume of claims will be processed at the reduced rate based on the negative update amount. The MACs will automatically reprocess claims paid at the reduced rate with the new payment rate. No action is necessary from providers who have already submitted claims for the impacted dates of service.

The bill passed without reference to an ICD-10 delay, giving further momentum towards the Oct. 1, 2015 implementation deadline and creating increased urgency for those still preparing for the new medical code set.

Last year, House leadership slipped a last minute rider into SGR legislation, delaying ICD-10 for another 12 months. The postponement was the third in six years, blindsiding the healthcare community and discouraging ICD-10 proponents who were left wondering if the code set would ever see the light of day. With the passing of this bill and omission of any further ICD-10 delay legislation, those concerns now appear to be behind us.
Healthcare professionals who have been watching from the sidelines should begin preparing immediately, if they haven’t already. ICD-10 is the mandated replacement of the ICD-9 code sets used by medical coders and billers to report healthcare diagnoses and procedures. Its implementation will radically change the way documentation and coding are done and will require a significant effort to implement.

Are your ready for these changes? If not, we can help!
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