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Value-based payment poses challenges for small, rural practices

The Centers for Medicare and Medicaid Services’ new Quality Payment Program, designed to reward providers for value and improved health outcomes, will be the biggest reform of clinician payments under Medicare Part B in the history of the agency. But are small and rural practices well prepared for such a transition?

Small and rural practices are concerned about the impact of the new requirements, and CMS says it is taking additional steps to help these practices with the transition. However, critics such as the Government Accountability Office are not convinced that all small and rural practices can access these services.

The Quality Payment Program, part of the implementation of the Medicare Access and CHIP Reauthorization Act (MACRA), will involve Medicare Part B payments for about 600,000 clinicians. In November, CMS published a final rule to implement the Quality Payment Program under MACRA. As part of the program, clinicians have two tracks from which to choose—the Merit-Based Incentive Payment System (MIPS) or the Advanced Alternate Payment Models (APMs), based on their practice size, specialty, location or patient population.

CMS originally proposed that the first MIPS performance period start on Jan. 1, 2017, running the length of the calendar year, with the first MIPS payment year slated to begin in 2019. However, about a month before CMS issued its final rule in October, the agency decided to be flexible in these requirements by offering a “pick your pace” approach, according to Kate Goodrich, MD, director of the CMS Center for Clinical Standards and Quality.

“We heard overwhelmingly from clinicians that many of them did not feel ready to begin participating in 2017, which was what we had proposed as the first MIPS performance year,” Goodrich told a joint meeting of the Health IT Policy and Standards Committees last week. “We worked very hard to figure out how we could design a transition year that would allow people who are ready to be able to participate fully, but also allow an on-ramp for those who really felt like they needed more time.”

Also See: Is the new MIPS payment system deadline too challenging?

MIPS consolidates components of three existing programs—the Physician Quality Reporting System (PQRS); the Physician Value-based Payment Modifier; and the Medicare Electronic Health Record Incentive Program for eligible professionals.

“There are many clinicians out there who have been participating in PQRS and Meaningful Use for years, and they clearly did feel ready and wanted to begin in 2017. But, in particular, we heard from small practices, rural practices and folks who represented them, that they needed more time to understand the program and to get their systems ready” by, among things, partnering with EHR vendors and registries, added Goodrich.

Nonetheless, the additional time offered by CMS might not be enough for small and rural practices to succeed under MIPS, some critics charge.

According to the Government Accountability Office, Medicare is attempting to save money and improve healthcare quality by using value-based payment models, which encourage clinicians to use electronic health records to better track and evaluate patient care.

But, in a new report, GAO found that some of these practices have small budgets, making it more difficult for them to invest in the training and technology they need to participate. Auditors also found that not all of these practices have access to organizations that can help them share staff and IT systems.

Specifically, GAO warned about these challenges faced by small and rural practices looking to participate in value-based payment:

  • Practices need to hire and train staff, as well as develop experience using EHR systems and analyzing data needed for participation.
  • They may lack financial resources needed to make initial investments, such as those to make EHR systems interoperable, and recouping investments may take years.

“Separate from interoperability, some stakeholders also reported that providers and payers may not be willing to share information, such as claims and price data, that would aid analysis and help a practice manage patient care—such as tracking when patients visit specialists or fill prescriptions—as well as control costs,” states the GAO report. “It may be especially challenging for small and rural physician practices to gain access to such data as they may not have the relationships with payers that larger practices may have, which is needed for data sharing.”

Robert Tennant, director of health IT policy for the Medical Group Management Association, says the GAO report identifies many of the barriers that smaller physician practices in particular encounter in their efforts to move to a value-based care environment.

“Budget constraints, technology limitations, and insufficient staff training are just some of the challenges these practices face,” says Tennant.

A CMS spokesman declined to specifically comment on the GAO report, and instead referred to an October 14 letter to Medicare clinicians from Acting Administrator Andy Slavitt, in which he said the agency was taking additional steps to aid small practices, including allowing practices to begin participation at their own pace; changing one of the qualifications for participation in Advanced APMs to be practice-based as an alternative to total cost-based; and conducting significant technical support and outreach to small practices, using $20 million a year over the next five years.

“Due to these changes, we estimate that small physicians will have the same level of participation as that of other practice sizes,” wrote Slavitt.

More recently, writing in a December 12 article in Health Affairs, Health and Human Services Secretary Sylvia Mathews Burwell noted that EHRs can inform treatment and reveal patterns in patient health, enabling preventive rather than reactive measures. However, at the same time, Burwell acknowledged that small and rural practices face significant challenges.

“Implementing MACRA has just begun, and we know questions will continue to arise regarding whether we have sufficiently tailored the program to support small and rural practices,” wrote Burwell. “To address these challenges, we plan to continue working closely with clinicians and patients, listening to their concerns and ideas, and responding to their feedback. MACRA is a significant step forward in reforming Medicare payments, but it is an iterative process. This is just the beginning.”

Under the new Quality Payment Program, Meaningful Use is essentially restructured into a new Advancing Care Information (ACI) performance category as part of MIPS for purposes of calculating payment. Goodrich said the measures found within the ACI category are based on the measures adopted by the EHR Incentive Programs for Stage 3 in 2015.

The objectives in the ACI performance category of MIPS emphasize measures that support clinical effectiveness, information security and patient safety, patient engagement, as well as health information exchange. The new ACI performance category score under MIPS defines a meaningful EHR user as a MIPS-eligible clinician who possesses certified EHR technology, uses the functionality of CEHRT, and reports on applicable objectives and measures.

Goodrich emphasized that clinicians need to understand that in order for them to report any of the measures under the ACI category “they must use certified EHR technology.” Still, she said that CMS believes “there will be easier access” to participate in MIPS and “to be successful in the Quality Payment Program by small practices, rural practitioners and those in health professional shortage areas,” thanks to the “pick your pace” approach, including the transition year.

“We’ve reduced the time and cost to participate not only because of pick your pace but also because we’ve reduced the number of measures that are required to be successful,” according to Goodrich, who noted reduced requirements for the “Improvement Activities” performance category (for example, one high-weighted activity or two medium-weighted activities). “The requirements are essentially half of what they are for everybody else.”

In addition, to help small and rural practices, Goodrich said CMS established exceptions, including a low-volume threshold of less than or equal to $30,000 in Medicare Part B allowed charges or less than or equal to 100 Medicare patients. To be eligible, all other clinicians must bill more than $30,000 a year under Medicare Part B and provide care for more than 100 Medicare patients per year.

She also pointed out that the MACRA legislation provided about $100 million to CMS to provide technical assistance and support specifically geared towards small practices or those in rural or underserved areas. “That procurement action is well underway, and we hope to be able to make an announcement about that sometime early in 2017,” Goodrich concluded.

Nonetheless, according to the GAO, although organizations such as group practices, private companies, nonprofit groups and universities offer a variety of services that can help small and rural practices with challenges to participating in Medicare’s value-based payment, not all small and rural practices have access to these organizations and the services they provide.

MGMA’s Tennant says the GAO report identifies several “non-partner” organizations that could potentially provide assistance, yet correctly concludes that not all practices will have access to these resources.

“We hope that this important report serves as a catalyst for policymakers to explore innovative solutions that assist these physician practices in providing high-quality and more efficient patient care,” adds Tennant.

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