Nearly a third of physicians could be exempt from implementing the Medicare Access and CHIP Reauthorization Act (MACRA), Medicare’s new merit-based incentive payment system that went into effect January 1. For the rest, MACRA is here, ready or not.

Ray Hanley, president and CEO, Arkansas Foundation for Medical Care, said that Arkansas physicians may have a head start advantage over those in other states because of the innovative payment reforms, such as “episodes of care,” that Arkansas’ Medicaid program began about five years ago.

“These outcome-based payment concepts, including financial bonuses or penalties based on physician peer group performance, mirror a lot of what MACRA is supposed to do,” Hanley said. “The healthcare payer world, public and private, is going to shift away from traditional fee-for-service, not overnight but certainly gradually over the next few years, and MACRA is one large step on that road.”

How physicians are impacted depends on how their practices and outcomes compare with their peer group. Hanley said they could see no change, earn incentive payments the following year on their Medicare Part B claims if doing better than their peers, or have payments reduced if their metrics are below peer group performance.

Physicians who have less than $30,000 in annual Medicaid payments are exempt from MACRA. In Arkansas, 600,000 people representing 20 percent of the state’s population are insured by Medicare. Hanley said unless a physician restricts the number of Medicare patients in his or her practice, most will earn more than $30,000 from the program. “Remember that those 600,000 people will use more healthcare services than younger Arkansans,” Hanley said.

Originally there was a $10,000 threshold for exemption. Hanley said the higher threshold is helpful.

“The program is new with some trial and error,” Hanley said. “Starting with fewer physicians and with a higher threshold will allow time to see how MACRA will work in practice.”

Hanley said there are added requirements such as the need for electronic health records (EHRs), and risk (or possible reward), for MACRA participation.

There are some concerns MACRA could make it more difficult for Medicare patients to find physicians willing to see them. Hanley said if a physician can keep his or her practice full, with limits on Medicare patients (which some already do primarily because of lower reimbursements), then there is a likelihood that some will use the desire to stay out of MACRA for now as a reason to limit their Medicare participation.

With a new administration in Washington, things could change.

“The big unknown concerns the likely new Department of Health and Human Service Secretary Tom Price,” Hanley said. “He has expressed reservations in the past about things like MACRA and shifting away from fee-for-service. It remains to be seen how he might influence MACRA starting in 2017.”

Price, a member of the U.S. House of Representatives from Georgia prior to be selected to head HHS, has proposed eliminating the Affordable Care Act and cutting the nation’s entitlement programs. Many physicians are not quite prepared to comply with all the MACRA reporting requirements, said Jackie P. Boswell, MBA, FACMPE, assistant vice president, SVMIC.

“The Physician Quality Reporting System and Meaningful Use are current Medicare quality reporting programs and even those have been a challenge for providers,” Boswell said. “The Value-Based Payment Modifier has been implemented in the past few years and many providers are unaware that program exists even though they face potential payment adjustments for scoring in the bottom percentile. The Merit-Based Incentive Payment System (MIPS) will replace these current programs beginning January 1. The Centers for Medicare and Medicaid (CMS) has relaxed some of the initial MIPS reporting requirements and implemented a ‘Pick Your Pace’ program for the 2017 Performance Year. This modification allows providers who are not ready to just report something to avoid a penalty. CMS realizes providers are not prepared to comply with their new quality payment programs for a full year.”

Boswell said it is important to get up to speed on MACRA, because providers could end up being penalized eventually up to nine percent. She said there are many providers who are weighing the costs versus the benefits of complying with all of the requirements, and feel that the benefits may not outweigh the costs.

“The reporting is very confusing,” she said. “Providers aren’t sure what quality measures they should be reporting or how to report each of the categories. Even though the payment adjustments will now be combined, providers may still have to report using different systems such as registry and electronic health records (EHRs). My best advice is to start reviewing the reports that are available currently such as the Quality and Resource Use Report (QRUR), and their PQRS Feedback Reports. These are available through CMS’s Enterprise Portal.”

She encourages providers to talk to their EHR vendors to determine what capabilities they will have for MIPS reporting. She also recommends not reacting too quickly to pressures to spend large amounts of money to upgrade or replace their current systems. She encourages them to meet with their vendors and understand what solutions they will offer.

“Vendors might make it sound like you have to upgrade right now,” Boswell said. “Physicians need to be thoughtful about the process.”

Another reason it is so important for physicians to prepare for these quality payment programs is that Medicaid and commercial payers have already begun implementing similar quality incentives and penalties. So in addition to the risk of non-compliance resulting in penalties from CMS, there is a risk of being eliminated or de-selected from commercial networks.

“Basically, the payers are moving from a fee-for-service, volume based environment to pay-for-performance,” she said.

There is a risk that some providers will be more selective accepting patients. Boswell said ideally the payers will be at risk adjusting for patients with chronic conditions. She emphasized the importance of providers coding all chronic conditions, as well as patient non-compliance. Providers should familiarize themselves with the ICD-10 codes for patient non-compliance.

Boswell also advises that the entire office, including providers, should be educated and aware of quality payment programs which will include scoring for patient experience. Patient Experience includes more than just patient satisfaction.

“Patients expect excellent care and to be treated respectfully. Patient experience goes beyond that. It is insuring that the patient understands their diagnosis, medication and treatment plan. It insures that caretakers understand how to care for the patient,” she said. “It is patient access to their providers when they need to speak to someone or be seen. It’s all about patient-centered care.”

Boswell said that the healthcare industry has begun the process of paying providers based on value instead of volume. “And they are defining value as improving the quality of patient care and outcomes, better patient experience and lowering the cost of healthcare,” Boswell said. “The healthcare industry calls this the Triple Aim. Based on how the payer determines that the provider has performed in these three areas, he/she may receive an incentive or a penalty.”