What every small practice should know about MACRA

November 4, 2016

The nearly 2,400-page final rule for the Medicare Access & CHIP Reauthorization Act (MACRA) has been reviewed by healthcare experts, and the general consensus is that it’s an improvement compared to the proposed rule, but challenges for small practices remain.

The nearly 2,400-page final rule for the Medicare Access & CHIP Reauthorization Act (MACRA) has been reviewed by healthcare experts, and the general consensus is that it’s an improvement compared to the proposed rule, but challenges for small practices remain.

“The main thing that struck us was how flexible 2017 is,” says Ingrid Lund, Ph.D., practice manager for the Advisory Board, a Washington, D.C.,-based healthcare consulting firm. “The downside to the flexibility in 2017 means there are very reduced rewards for those that have prepared well.”

Flexibility comes in the form of “pick your path,” allowing practices to do anything from reporting one quality measure for 90 days to avoid Medicare payment penalties to reporting all required data for the year to receive a small bonus.

For many small practices, the extra flexibility means time to not just prepare for implementation, but to learn more about MACRA, says Walt Gorski, director of regulatory affairs for the American College of Physicians, who notes that about half of physicians don’t even know what MACRA is. “I look at the flexibility as an opportunity to educate physicians about this rule,” he says. “Overall, the Centers for Medicare & Medicaid Services (CMS) made great strides from the proposed rule in giving practices more options and flexibility to meet the requirements of the new program.”

Laura Wooster, MPH, interim senior vice president, public policy for the American Osteopathic Association, agrees that the extra time is crucial to get physicians ready. “Now we have a lot more time to get people educated and for them to try it out,” she says.

Small practice challenges

While experts agree that CMS listened to feedback from both medical associations and independent physicians, challenges for small practices remain.

John Meigs, Jr., MD, president of the American Association of Family Physicians, says he still has problems with the overall complexity of the rule. He is disappointed that the virtual group implementation was delayed, which was a feature that would benefit small practices by combining data for reporting purposes. And while small practices are not held accountable for the total cost of care at least for the first year, he says he has big concerns about that for future years.

Data reporting under the Merit-based Incentive Payment System (MIPS)-one of MACRA’s two paths for getting paid-requires technology that independent physicians may not have in place, which could create another obstacle to implementation. “By 2018, they will be required to have a 2015-certified electronic health record (EHR) system, and that doesn’t exist yet on the market,” says the AOA’s Wooster. “Everybody should be talking to their vendor to find out the timeline and costs. There will most likely be a high cost to upgrade.”

Next: “At least with MACRA, you have a chance for bonuses"

 

Between the new law’s complexity and costs, some small practices may look for a way out, whether it’s through selling to a hospital, retiring or getting out of Medicare, says Lund, but MACRA isn’t solely to blame. “I caution the notion that MACRA is the end of the small practice and this is the sole force behind it,” she says. “But it will accelerate a force that is already happening-consolidation across physician types.”

She adds that some small practices will figure out how to comply, and the $20 million in annual funding from CMS to assist small practices with compliance may help.

If practices use 2017 to learn the MACRA basics, they will be in a much better position for 2018 and beyond, says Wooster. “Under this transitional year [2017], small practices can absolutely survive,” she says. “It will buy them some time to take a deep breath and figure out how to excel in their practice. 2018 will also be a transitional year, but it won’t be as easy.”

By then, she hopes the virtual groups will be operational, because the only way small groups can really compete is by pooling risk and sharing resources. “With virtual groups, they will be able to survive and thrive,” she says. By pooling resources and data, small groups would function as a larger group during a MIPS performance period, spreading risk and possibly taking advantage of advanced Alternative Payment Models, but the details aren’t defined at this point.

As part of the final rule, CMS also lowered the exemption threshold, so any physician that bills Medicare less than $30,000 annually or has 100 Medicare patients or fewer does not have to participate in MACRA. That’s great news for many small practices or solo practitioners, but Lund points out this means for those practices that just missed the cutoff, they will have to compete against bigger players on quality measures.

Despite these challenges, Wooster says that MACRA is still an improvement over the previous physician quality reporting system and meaningful use measures, where everything was a penalty. “At least with MACRA, you have a chance for bonuses,” she says, noting that the penalties are also smaller. For instance, in the first year of MACRA payment, the biggest penalty is 4% compared to 11% under the old system.

Take action

When it comes to what small practices should do next, Wooster and Lund say the best approach is for practices to do as much reporting in 2017 as possible and see how they fare. Taking this step avoids the maximum 4% payment penalty and prepares them for the increased reporting requirements for 2018 and beyond.

With the amount of information available from CMS, medical associations and the media, the ACP’s Gorski says, spending a lot of money to comply with MACRA isn’t necessary. “Don’t go out and hire a consultant,” he says. “Look-and have your practice managers look- to see what’s out there. Make sure you are reading publications to supplement what you’ve heard or conversations you’ve had with your peers to learn about the system.

Next: “It’s worth noting that MACRA passed with bipartisan support"

 

“It’s a matter of education,” he adds. “The first step is to start learning about the program. Once you take that first step, you take another one and learn what you need to do.”

Practices should not ignore the transition from a fee-for-service model to value-based care, no matter how challenging it may be to implement, because it’s a trend that’s most likely here to stay. “A lot of us don’t like change, because change is difficult,” says Meigs, adding that fee-for-service payments was not a good payment system for primary care anyway. “Pick-your-pace has done a good job of making the transition as painless as possible, while allowing those who were ready and able to be eligible for bonus payments,” he says.

The worst thing physicians can do about MACRA is to ignore it, says Wooster. With so many changes in healthcare, she isn’t surprised that many doctors either don’t know what MACRA is or haven’t paid any attention to it, but the time to act is now.

“Some may think that if they don’t pay attention, this will just go away,” Wooster says. “I encourage them to get out there and learn and test it out. Delaying just means they’ll face the same set of problems later.”

And for those hoping a new president might eliminate MACRA or change its requirements, that’s probably not going to happen, says Lund. “It’s worth noting that MACRA passed with bipartisan support,” she says. “Congress appears committed to making this work. Value-based care is a trend you can bet on.”