Why it’s essential that MACRA’s start be delayed

This week at a hearing before the Senate Finance Committee, providers heard some comforting statements from Senate leaders and a key official from the Centers for Medicare and Medicaid Services.

At the hearing, Andy Slavitt, acting administrator for CMS, said his agency was looking for ways to be flexible with the approach for enacting the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and implementing the Merit-Based Incentive Payment System (MIPS). The program would widely revamp approaches to physician payment to focus incentives on quality, not volume of services.

The new reimbursement approach is meant to radically change incentives, and will affect many aspects of physician practice, including the types of information systems they use and the data they draw from them.

Most encouraging was the attention being paid to the plight of physicians in small and independent practices.

“Physicians are concerned that they won't have enough time to prepare, and this seems to be a legitimate concern,” said Senate Finance Committee Chairman Orrin Hatch (R-Utah). “If the final incentive rules are released about November 1, that will give everyone only about two months before this goes live. The MACRA law does give CMS flexibility about the start of physician reporting period. What options is CMS considering to make sure this new program gets off the right foot?”

“We need to launch this program so that it begins on the right foot,” Slavitt replied. “That means that every physician in the country needs to feel like they are set up for success.”

How this new reimbursement program starts is not only crucial to physicians, but it’s important to the wider universe of providers. And, it’s certainly important to the country. That’s why getting off on the right foot is imperative.

I’d like to draw some lessons from past federal initiatives that have had a major impact on the healthcare industry, including the meaningful use program. There are important lessons to be learned about how to influence an industry as large and pervasive as the one that provides healthcare.

While a good start is important, it’s also crucial to look at how a program will work over time. Yes, setting a good foundation for that first step is critically important.

One needs to look no further than the Sustainable Growth Rate formula for physician reimbursement that MIPS is intended to replace. No one put that into place with the intention that it would be reviled, ignored and an annual source of annoyance for physicians and legislators alike. But that first attempt to regulate Medicare expenditures on physicians was all that, not to mention ineffective.

And, it’s more than just having a good start, as evidenced by the meaningful use program. There, the intent was to get providers to install electronic health records systems and then ratchet up the challenge so providers would use those systems to gather meaningful data, improve care and then widely share data. The first step was intentionally easy, but the program became prohibitively challenging as time went on for a variety of factors, some related to the immaturity of the technology, some related to the pace of change.

From the healthcare IT perspective, the programmatic challenges resulted in a cycle of provider disillusionment, administrative rollbacks on objectives and delays of stages that have interjected uncertainty about the program.

There are many other lessons that can be drawn from these efforts, but the government and industry need to take a fresh look at what’s really being sought from MACRA. It’s no less than a total recalibration of the nation’s way of delivering healthcare.

Those of us who cover the industry, or administrate it, can intellectually understand the wisdom and need to change incentives so that it’s quality of services, and not just the quantity, that dictate financial success. It’s not going to be that simple—almost everything in healthcare, from the computer systems in use to the way we measure quality, and much more—is predicated on quantity. We’re only at the beginning stages of building a system based solely on quality.

This isn’t just a small and independent practice issue—it’s a whole system issue that needs to affect every player in the industry. The start needs to be good; the pacing needs to be right; and the switchover to a quality-based system needs to be well thought out and flexible enough to embrace the challenges that will be encountered.

We can’t believe that, just because we’re following this policy discussion, that every provider in the nation is anxiously awaiting this shift. A survey by Deloitte released yesterday suggested a scary statistic—that as many as half of physicians aren’t even aware that the Medicare reimbursement system is about to change. Providers have a load of cares for each day and week, and they’re not worrying about potential changes in reimbursement until they happen, which will be too late.

This change in reimbursement approach comes at a crucial time, as the nation tries to rein in healthcare expenses and get more value out of what’s being spent. Healthcare spending will eat up 20 percent of the U.S. economy within a decade, CMS estimates.

We can’t afford any missteps with this, and rushing too quickly hasn’t worked in the past. Many groups are pushing for a delay in the implementation date until July 1, 2017. Even that seems like a fast-track implementation at this point.

I’ll bring up one more lesson we learned as an industry—the implementation of ICD-10 (okay, I won’t mention the delays in the deadline). But the industry knew it was important, and given enough time and focus, it was able to make the transition on Oct. 1, 2015.

So, a suggestion: set a January 1, 2018, start for the new program, and set out goals that are challenging, widely known and easily understandable. Educate everyone on the program, the goals and their importance. Let providers know they’ll be at risk beginning January 1, 2018. Reimburse physicians at a rate that keeps the program budget-neutral in 2017, and do everything possible to ensure its long-term success.

Starting on the right foot will be essential, as will all the subsequent steps. As a nation, we can’t afford any missteps.