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MACRA reforms are coming, but devil is in the details


No physician knows with certainty what payment tactics Medicare will actually be offering physicians, because CMS actually has not decided them yet. Thus the devil will be in the details. Here is what CMS must do.

John L. Bender, MD, MBAThe Medicare Access and Children’s Health Insurance Program Reauthorization Act of 2015 (MACRA) was an historic bipartisan vote in Congress, considering that this law marked the end of a 13-year struggle by physicians against the flawed Medicare Sustainable Growth Rate (SGR) formula, recurrent emergency “fixes,” and piecemeal patches.

MACRA gave physicians a 0.5% pay raise (spoiler alert–the so-called “sequester” will have the eff ect of chiseling this away from year to year as the U.S. seeks to balance the budget.) In addition, starting in 2019, physicians will have the option of being paid through an alternative payment model (APM) such as a patient-centered medical home, or by staying in the fee-for-service system and participating in the new Merit-based Incentive Payment System (MIPS).

The law will keep the Centers for Medicare & Medicaid Services (CMS) busy. After a public comment period, CMS is expected to release a round of “fi rst implementation” rules, as early as March 2016. Meaningful Use (MU), the Physician Quality Reporting System (PQRS), and the Value-based Modifi er must all be revised to align with MIPS before 2018. Meanwhile, U.S. Department of Health and Human Services Secretary Sylvia Burwell has announced an ambitious goal of tying 30% of Medicare fee-for-service payments to value by 2016, and 50% by 2018. Therefore, in one sense, no physician knows with certainty what payment tactics Medicare will actually be offering physicians, because CMS actually has not decided them yet. Thus the devil will be in the details. Here is what CMS must do:


CMS needs to make interoperability between electronic health records and care delivery systems a priority before moving forward with the final stages of meaningful use. If physicians are ranked and paid based on the current state of the art, it will be capricious and disastrous, because the current quality reporting systems remain fragmented and primitive. Th ey are not representative of true quality, patient outcomes, or aggregate healthcare costs. Only robust interoperability between systems can transcend current “vintage use” of faxing and manual data entry that plagues physicians and their care teams in the post-HITECH age.

Another devil CMS must avoid is “statewide gainsharing.” Perhaps the biggest downfall of the Comprehensive Primary Care Initiative (CPCI), statewide gainsharing is neither innovative nor motivational. More like communism than free market economics, it is “each according to their ability, and to each according to their need.” Only if the entire region or state creates savings is the individual organization or provider rewarded. Such a system vanquishes any hopes of engaging providers through personal reward for local eff orts. It has the opposite eff ect, tantamount to paying a subsidy to your under-performing competitor.

And there is now legislation proposed for CMS to test-drive Direct Primary Care (DPC). Th is alarms some DPC purists, but for others, it off ers another APM option that could be deployed under MACRA. If CMS begins paying directly for DPC subscription fees, it is hard to imagine there would not be some intrusions into the exam room, which has happened in the past when third parties start paying for the consumer.


MACRA has potential. It is definitely a breath of fresh air for physicians to finally be out from under the SGR. Let’s all hope that CMS will make best use of this period of public comment to inform the process before rule promulgation; and let’s also pray that CMS will remain receptive to feedback during the implementation of MACRA over the next five years.

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