At the Helm

6 experts on what the 2018 MACRA final rule means for you


Since CMS released its final rule to implement year two of MACRA's Quality Payment Program (QPP) last week, our experts have analyzed the 1,000+ pages. They plan to share key insights and action items their upcoming webconferences:

  • An expert panel discussion on the strategic implications of the 2018 MACRA Final Rule on Monday, November 20 at 3 p.m. ET. (Register now to secure your spot).
  • A detailed analysis of the 2018 MACRA Final Rule and operational action items on Tuesday, December 12 at 1 p.m. ET. (Register now to secure your spot).

Here's a sneak peek of their reactions to the rule:

Rob Lazerow

Rob Lazerow, Managing Director, Health Care Advisory Board

Consistent with our take on the proposed rule, this final rule confirms that the movement toward value-based care remains one of CMS's ongoing goals, and that new payment models are gaining traction with providers.

In this final rule, after factoring in the latest payment models and application periods—especially MSSP Track 1+, the Next Generation ACO Model, and the CPC+ program—CMS has increased its estimate of the number of providers who could qualify for the Advanced Alternative Payment Model (APM) Track from the proposed rule by 25,000 clinicians. CMS now expects that up to 250,000 providers will qualify in CY2018. That's more than twice CMS's 2017 projection.

There's an important trend driving this growth in potential APM qualification. MACRA is already encouraging providers to transition beyond the upside-only risk models that initially dominated the Medicare ACO landscape. The number of Medicare ACOs participating in downside risk models more than doubled from 2016 to 2017, reaching 87 this year.

I expect this migration to downside risk will continue as more providers reach their MSSP renewal dates, especially since CMS finalized the proposal to maintain the current standard for payment models to count toward the Advanced APM track through 2020. By law, payment models must impose more than a "nominal amount" of risk to qualify.

Additionally, the final rule establishes the initial steps for organizations to submit information to CMS to potentially qualify for the APM track in 2019 using the All-Payer Combination Option. Perhaps the biggest news on this front is that CMS is now exploring a potential demonstration program for providers to qualify for the APM track purely through Medicare Advantage (MA) arrangements prior to 2019. This demonstration could benefit clinicians treating large populations of MA enrollees. We'll monitor this development closely as CMS releases information in the coming months.

Learn the three steps to establishing an intentional Medicare risk strategy

Overall, this final rule gives providers continued clarity that they must develop an intentional Medicare risk strategy—and potentially prepare for risk within other payer segments—to succeed under MACRA.



Hamza Hasan

Hamza Hasan, Practice Manager, Medical Group Strategy Council

One of the most important takeaways from the final rule is that CMS has weighted the cost category at 10% in the 2018 performance year. By law, the cost category must account for 30% of the MIPS score by the 2019 performance year, so CMS is using the coming year as an on-ramp to the more stringent performance standards of 2019.

In addition, CMS has used the final rule to confirm that episode-based cost measures will not be included in the 2018 cost performance category, as they are working to develop new episode-based cost measures for future years. That means 2018 cost performance will be measured on a combination of the total per-capita cost for all attributed beneficiaries and the Medicare Spending per Beneficiary (MSPB) measures. The agency has also noted that it will provide performance feedback on each of these two cost measures by July 1, 2018.

Access the 2017 Merit-Based Incentive Payment System (MIPS) score estimator

Leaders should use the coming year to better understand their cost data and prepare for an increasing percentage (i.e., 30%) of their MIPS score to be based on their cost performance by the 2019 performance year.



Tony Panjamapirom

Tony Panjamapirom, Senior Consultant, Health Care IT Advisor and Quality Reporting Roundtable

Throughout our experts' takes on the 2018 QPP final rule, you will find one common theme: CMS keeps a lot of the 2017 flexible policies that will benefit providers in 2018. One of those policies is to award providers who adopt and meaningfully use Certified EHR Technology (CEHRT). The major IT-related news from the rule is that CMS pumped the brakes on its plan to require QPP participants to upgrade their CEHRT to the 2015 Office of the National Coordinator for Health Information Technology (ONC) Edition software in 2018.

This flexibility to allow providers more time to upgrade their systems isn't surprising, since CMS this past August in its 2018 Inpatient Prospective Payment System (IPPS) final rule established the same policy for hospitals that participate in the Inpatient Quality Reporting and Meaningful Use (MU) programs. This also means providers can choose to report the Advancing Care Information (ACI) "transition" measures (i.e., aligned with Modified Stage 2 Meaningful Use [MU]) in 2018.

However, although the ACI measures (i.e., aligned with Stage 3 MU) are optional next year, providers may wish to consider early adoption of these more difficult measures as it affords an opportunity to gain bonus points. Specifically, if providers exclusively use the 2015 Edition CEHRT to report the ACI measures, they will earn 10 additional bonus points in the ACI category. Whether or not this is a worthwhile pursuit depends on provider's 2015 Edition CERHT readiness, the resources required to fully implement new workflows, and how they fare on their performance score under either set of ACI measures.

Additionally, even though CEHRT is required only for the ACI performance category, providers may consider leveraging it to earn additional bonus points under the Quality and Improvement Activity categories. That is, if providers report electronic clinical quality measures, they will be eligible for the end-to-end electronic reporting bonus points. Furthermore, if providers use CEHRT to carry out an applicable, reported improvement activity, they will gain additional bonus points under the ACI performance score. These CEHRT-related bonus points could help providers optimize their MIPS final score, which in turn improves the possible incentives.



Julia Connell

Julia Connell, Analyst, Physician Practice Roundtable

In this year's final rule, CMS is reducing the reporting burdens imposed on small groups in the first year of the QPP. Specifically, CMS plans to level the playing field for smaller groups in two key ways:

1. By increasing the threshold of Part B patients of charges necessary for an eligible clinician or group to be subject to MIPS from ⋜ $30,000 in Part B allowed charges or ⋜ 100 Part B beneficiaries to ⋜ $90,000 in Part B allowed charges or ⋜200 Part B beneficiaries. This alone will exclude about 123,000 more providers from MIPS; and

2. By offering a virtual group participation option.

Importantly, the increase to the low-volume threshold will likely make MIPS even more competitive—due to a smaller overall pool and the elimination of potential low-performers. This may result in lower bonuses for higher performers and a narrower spread between high and low performers in 2018.

CMS also introduced a potentially powerful tool to small groups: the virtual group reporting option. At its core, this option gives small groups the opportunity to achieve scale by pooling resources to realize a higher aggregate score than might have been possible on their own. There may also be an opportunity for larger organizations to support virtual group compliance, performance, and data aggregation efforts.

However, those considering the virtual group reporting option should be wary, as the utility of this option may be somewhat limited in early years due to several factors:

  • Only TINs with 10 or fewer eligible clinicians may form a virtual group;
  • Data aggregation may be complex, especially for the quality category, if multiple reporting mechanisms and systems are used across the participant TINs; and
  • Difficulty engaging providers who may not have had formal contractual working relationships in the past.

CMS also finalized its proposal to give small groups preferential treatment in certain categories of MIPS and will offer a five-point bonus to small groups in an attempt to ease reporting and scoring burden.



Kathryn Martucci, Senior Analyst, Health Policy and Gillian Michaelson, Senior Analyst, Research


Kathryn Martucci

It has certainly been a busy few months for health care leading up to the release of this final rule. In August, CMS officially proposed to scale back mandatory bundled payment models. In September, HHS Secretary Tom Price resigned, opening the door to new leadership at the department. Finally, in October, the Medicare Payment Advisory Commission (MedPAC) stepped up its criticism of the MIPS component of QPP, raising questions about whether Congress would take action to delay or change the program's current path to implementation.

While all this may seem like a signal that QPP, or payment reform in general, are standing on unstable ground, the release of this final rule and its content are clear indicators this is not the case.

First, despite numerous contentions surrounding health care issues on Capitol Hill, this final rule was released without any mention of GOP congressional or administrative action to delay QPP implementation, or to repeal or amend MACRA.


Gillian Michaelson

Second, while we have seen a roll back of mandatory bundled payment models, we have also seen the administration indicate that they intend to roll out additional optional bundled payment programs and potentially increase the number of specialist-focused alternative payment models. Additionally, this final rule continues CMS's commitment to the importance of established programs such as MSSP and CPC+, as well as the introduction of new paths to qualifying for the APM track, such as finalized details around the All-Payer Combination Model.

Health policy developments out of Washington will no doubt continue over the coming months, but this rule and the context surrounding it give us confidence that payment reform will continue to hold a firm place in the shifting health care landscape.

Next, join our experts for two new MACRA webconferences

Join us November 20 at 3 p.m. ET, for an expert panel discussion on MACRA's strategic implications.

Register Now

Join us December 12 at 1 p.m. ET for a detailed analysis and operational action items.

Register Now