QPP in 2017: Navigating the transition year

The Medicare Access and CHIP (Children’s Health Insurance Program) Reauthorization Act (MACRA) of 2015 repealed the flawed sustainable growth rate formula used to adjust physician reimbursements for services provided to Medicare beneficiaries and called for establishment of a new payment system that emphasizes value over volume. In response to this charge, the Centers for Medicare & Medicaid Services (CMS) developed the Quality Payment Program (QPP). Central to the QPP is the new Merit-based Incentive Payment System (MIPS). In addition, the QPP seeks to encourage surgeons and other physicians to participate in Advanced Alternative Payment Models (APMs) and other options under development that may become available to surgeons in future years.

The 2017 transition year to MIPS began in January. As part of this transition year, CMS has taken a number of steps to streamline reporting and make it easier for surgeons and other physicians to avoid penalties and achieve positive updates. However, over time, penalties for nonparticipation or poor performance will grow, as will payment increases for successful participation and improved performance.

It is critically important that all surgeons make a plan for how they can best participate and succeed in the new program. This article provides background on MIPS and its components, offers a discussion of reporting requirements for individuals and groups, summarizes the transition to MIPS in 2017, describes how surgeons and groups can set their own pace for participation, and highlights how MIPS will evolve in the coming years. It also looks at accommodations that are being made for small, rural practices, and describes the resources that the American College of Surgeons (ACS) has developed to help Fellows succeed under MIPS.

MIPS and its components

MIPS began measuring performance in January. The data reported in 2017 will be used to adjust payments in 2019.

MIPS consists of four components. Three of these are analogous to previous Medicare quality improvement programs, and include Quality, formerly the Physician Quality Reporting System (PQRS); Cost, formerly the Value-Based Payment Modifier (VM); and Advancing Care Information (ACI), formerly the Electronic Health Record (EHR) Incentive Program, commonly referred to as meaningful use (EHR-MU). MIPS also added a new component, Improvement Activities (IA). During the first year, three components—Quality, ACI, and IA—will be used to derive a composite MIPS final score. The weights for the individual components of the final score for the first year of the MIPS program are represented in Figure 1.

Figure 1. 2017 Performance Category Weights

2017 Performance Category Weights

Although CMS has chosen not to provide any weight to the Cost component during the first year of the program, those physicians who report Quality data will receive feedback reports on their performance in the Cost component.

Reporting options

The payment adjustment for surgeons who submit MIPS data as individuals will be based on their individual performance. A final score is calculated using the data submitted for Quality, ACI, and IA. Data for each of these three MIPS categories may be submitted through an EHR, a registry, or a qualified clinical data registry (QCDR). Quality data also may be submitted through the routine Medicare claims process, and data for ACI and IA may be submitted through the CMS web portal.

Surgeons who submit MIPS data as part of a group practice under a single taxpayer identification number will receive the MIPS final score and corresponding payment adjustment in accordance with the assessment made for their group practice (a single MIPS final score and corresponding payment adjustment is made for all individuals within the group). Those practices that choose to report as a group for any one of the reporting requirements also must report as a group for all of the remaining components of MIPS.

It is important to have an idea of one’s current preparedness and previous status with the Medicare programs that form the basis for MIPS, as those physicians who performed well in PQRS and EHR-MU are more likely to be successful in MIPS. Accordingly, the ACS recommends that all Fellows take a few simple steps to ensure successful participation in MIPS reporting. First, verify that the certified EHR technology (CEHRT) you are using is either a 2014 or 2015 edition. Use of one of these two editions is required to participate in ACI. In addition, it is critically important to become familiar with the available Quality measures and the data submission methods available to your practice, including consideration of the use of a registry or a QCDR. The ACS recommends that Fellows review the Quality measure benchmarks available on the CMS website to optimize their quality score.

Pick Your Pace

CMS has designated 2017 as a transition year and has provided a clear pathway to avoid penalties. In addition, CMS has reduced the reporting requirements in 2017 for those physicians who wish to fully participate in preparation for the future or for those practices aiming for a positive payment update. It is important to note that the funds available for positive payment updates are derived from the penalties assessed on physicians who choose not to participate. Accordingly, by making it easier to avoid penalties in the first year, CMS has reduced the amount of funds available for positive incentives. Surgeons should bear this adjustment in mind when planning their course of action and attendant resource requirements for 2017.

Participating to avoid penalties

For 2017, CMS instituted a Pick Your Pace approach, which gives surgeons options for participation in MIPS. Those physicians who opt out of participation at any level will receive the full negative 4 percent payment adjustment in 2019. However, it is worth noting that a negative 4 percent payment adjustment is less than half of the negative adjustments associated with the PQRS, VM, and EHR-MU programs in 2016.

To avoid the 4 percent penalty, CMS only requires that surgeons test their ability to report data in any one of three reporting components, namely Quality, ACI, or IA. Information for the Cost component is derived automatically and has no reporting requirement. To avoid a penalty, surgeons must complete just one of the following tasks:

  • Report one Quality measure for a single patient
  • Attest to participating in a designated IA for at least 90 consecutive days
  • Complete the base score requirements for ACI

Participating to prepare for future success

Surgeons seeking to achieve a higher score must report data for 50 percent of all patients seen (for all payors) for any period of 90 consecutive days. Accordingly, one could begin as late as October 2; however, CMS encourages reporting for the full year. How data are reported depends upon the circumstances of an individual’s practice, as there are multiple methods (EHR, registry, or QCDR) of submitting data to CMS. It should be noted that data can also be submitted either on an individual basis or as a group.

In the 2017 transition year to QPP, surgeons may use one of the following four options to participate:

Option 1: Test the MIPS program

Submit a minimum amount of 2017 data (for example, one Quality measure or one IA for any point in 2017) to Medicare to avoid a 4 percent Medicare Part B penalty in 2019. This option is for surgeons who may be unfamiliar with quality reporting and want to test it out or for those who only want to do the minimum amount of reporting required to avoid the penalty.

Again, CMS defines the minimum data submission necessary to avoid a penalty as one of the following:

  • One Quality measure
  • One IA
  • The required base score ACI measures

Option 2: Participate in MIPS for part of the year

Surgeons may submit data to Medicare for a continuous 90-day period in 2017 to avoid the penalty and possibly earn a small incentive payment. Surgeons who were not ready to start reporting on January 1 may start any time through October 2. This option adds flexibility for those surgeons who want to participate in the program but prefer to report for a shorter period of time.

By reporting for a 90-day minimum, surgeons will be eligible for at least a neutral adjustment, if not a small positive adjustment. Positive adjustments are based on performance, not the amount of information or length of time reported. However, reporting for a longer period of time is the best way to earn the maximum positive adjustment because surgeons can track their performance and thereby have the opportunity to improve.

Partial participation in MIPS means that surgeons should meet at least the following three criteria:

  • Six Quality measures for 90 or more consecutive days on 50 percent of all-payor applicable patients (50 percent of applicable Medicare patients for claims reporting)
  • Four medium-weighted or two high-weighted IA for 90 consecutive days
  • Report ACI measures for 90 or more consecutive days

Surgeons may choose different 90-day reporting periods for each performance category, including Quality, IA, and ACI.

Option 3: Fully participate in MIPS

Surgeons may submit up to a full year of data to Medicare in 2017 to be eligible for a positive payment adjustment in 2019. Full participation in MIPS means that surgeons report all of the following:

  • Six Quality measures for up to a full year on 50 percent of all-payor applicable patients (50 percent of applicable Medicare patients for claims reporting)
  • Four medium-weighted or two high-weighted IA for 90 consecutive days
  • ACI measures for up to a full year

Reporting for up to a full year is the best way to get the maximum positive payment adjustment. Not only does full participation allow surgeons to track their performance over a longer period of time, it also expands the number of available measures while better preparing them for future years of the QPP, which will likely require full-year participation.

Option 4: Participate in an Advanced APM

An APM is a payment approach that provides incentive payments for the provision of high-quality and cost-efficient care. APMs can apply to a specific clinical condition, a care episode, or a population. Advanced APMs are a subset of APMs that meet additional requirements, including use of CEHRT, use of evidence-based quality measures, and financial risk. Surgeons who receive 25 percent of Medicare payments or see 20 percent of Medicare patients through an Advanced APM in 2017 could earn a 5 percent incentive payment in 2019.

The ACS is working to expand the Advanced APM options for surgeons in the future. To view an Advanced APM proposal that the ACS submitted in December 2016, visit the “For Public Comment” section of the Physician-Focused Payment Model Technical Advisory Committee web page on the ASPE website.

Option 5: Do not participate

Nonparticipation in the QPP in 2017 will result in a 4 percent Medicare Part B payment penalty in 2019.

Pathway to a positive payment update

To compete for a positive payment update, surgeons and surgical practices will need to report specific information for each component of MIPS. Following is a summary of the reporting requirements by component.

Reporting for Quality

To be eligible to receive the full potential Quality score, data must be submitted for 50 percent of all patients seen (for all payors, except those who report by claims) for at least a 90-consecutive-day period on a minimum of six measures, including one outcome measure. Another high-priority measure may be substituted if an outcome measure is unavailable. Measures can be chosen from the MIPS measures list, a MIPS specialty-specific measure set, or QCDR measures.

Those surgeons who do meet the reporting requirement and perform well on the measures can receive up to 60 points toward their MIPS final score. For those surgeons simply seeking to avoid penalties for the first year of the MIPS program, reporting a single measure for a single patient will yield the three points necessary to meet the threshold that CMS has prescribed for avoiding a penalty in this transition year. Bonus points also are available by reporting on additional outcome measures, high-priority measures, and end-to-end reporting measures using CEHRT.

Reporting for ACI

The ACI component is worth 25 percent of the MIPS final score. The assessment for ACI is a composite score composed of two parts: a base score and a performance score. As stated previously, to receive credit for the ACI component in 2017, one must use 2014 or 2015 edition CEHRT. According to current regulations, only those providers with 2015 edition technology will qualify for ACI beginning in 2018.

The base score is an all-or-nothing threshold and accounts for 50 percent of the total score for the ACI component. Achievement of the base score is required before any score can be accrued for the performance portion. Achieving the base score also is one of the options prescribed by CMS sufficient to avoid any MIPS penalties in 2017. If the base score is achieved, no penalty will be imposed, even if no Quality, IA, or additional ACI data are submitted. The ACI measures are intended to ensure that CEHRT is being used for core tasks, such as providing patients with online access to their medical records, exchanging health information with patients and other providers, electronic prescribing, and protecting sensitive patient health information through a security risk analysis.

Once all of the measures for the base score have been met, clinicians are eligible to receive credit for performance on both a subset of the base score measures and on a set of additional optional measures. Bonus points are also available by reporting certain IA via CEHRT.

Reporting for IA

While IA is a new category, surgeons are familiar with many of the activities it encompasses, such as Maintenance of Certification, use of the ACS National Surgical Quality Improvement Program Surgical Risk Calculator, participation in a QCDR, and registration with their state’s prescription drug monitoring program. Each activity is assigned a value of either 20 points (high value) or 10 points (medium value). The reporting requirement for the IA is fulfilled through simple attestation via a registry, a QCDR, or a portal on the CMS website. To receive full credit, most surgeons must select and attest to having completed two to four activities for a total of 40 points. For small practices, which CMS defines as those with fewer than 15 providers or those in rural practices, the agency has said that to achieve full credit only one high-value or two medium-value activities are required. Those who fulfill the requirement will receive 15 points toward the MIPS final score. Surgeons who simply want to avoid a penalty in the first reporting year of MIPS may do so by attesting that they have completed a single activity for 90 days.

The MIPS final score and payment updates

To review, performance in the four MIPS categories (Quality, ACI, IA, and Cost) will be combined into a single MIPS final score, which will be benchmarked against a threshold to determine each provider’s payment update. The maximum payment updates, the category weights (see Figure 1), and the threshold will all vary over time.

Component weights

For the 2017 performance year, Quality, ACI, and IA performance will account for 60, 25, and 15 percent of the total MIPS score, respectively. For the first year, the Cost category carries no weight, although providers still will receive information on their resource use relative to other providers. By 2019, Quality and Cost are set to be equally weighted at 30 percent, with ACI and IA continuing to account for 25 and 15 percent, respectively. Also of note, once 75 percent of physicians are classified as meaningful users of EHR technology, the ACI component weight can be reduced to as low as 15 percent, with the remainder distributed among the other categories.

Provider performance in the four categories will be adjusted annually based upon that category’s weight, and combined into a MIPS final score between 0 and 100 (see Figure 2). This score will then be compared against a performance threshold. If the score is above the threshold, the provider will be eligible for a positive update; if the score is equal to the threshold, the update will be neutral; and if the score is below the threshold, payments will be reduced.

Figure 2. MIPS yearly payment adjustments

MIPS yearly payment adjustments


Source: Centers for Medicare & Medicaid Services

In general, the maximum positive and negative updates are 4 percent for the 2019 payment year (based on 2017 performance) and will grow annually until they reach plus or minus 9 percent for 2022 and future years. For the first six years of the program, MIPS providers with the highest performance scores (typically those in the top three quartiles above the performance threshold) will be eligible for an additional positive update of up to 10 percent. Up to $500 million per year is available for these additional updates.

The performance threshold

The performance threshold will typically be the average of a prior performance period, but because of the lack of historical data, the Secretary of the Department of Health and Human Services (HHS) has discretion in setting the threshold for the first two years. For the 2017 performance year, the threshold is set at 3, which means that any provider who reports a single Quality measure for a single patient, participates in a single IA for 90 consecutive days, or completes the ACI base score requirements will be at or above the threshold and, therefore, avoid penalties. As previously mentioned, this flexibility means that most providers will be exempt from penalties in the 2019 payment year, and positive updates for eligible providers are likely to be modest.

Single update versus multiple penalty programs

The MIPS program’s scoring system may seem complex, but it effectively replaces multiple programs (PQRS, EHR-MU, and VM), which had the combined potential to impose penalties totaling 10 percent in 2016. MIPS, in contrast, has a single update mechanism and provides much greater opportunity for positive payment adjustments while reducing the downside risk.

Support for individual, small group, and rural practices

Solo practitioners and small group practices of 15 or fewer physicians, particularly those in rural or health professional shortage areas (HPSAs), may be eligible for technical assistance or subject to reduced requirements designed to help them succeed in the QPP. HHS will award $20 million for each of the first five years of the QPP to organizations tasked with helping these practices, as well as those in medically underserved areas, succeed. This money will be allocated to provide direct outreach and technical assistance, such as helping practices decide which Quality measures to report, offering advice on EHR selection and implementation, and discussing how to improve the MIPS final score by receiving credit for IAs. Help also will be provided to those individuals and practices interested in exploring participation in APMs.

Certain scoring advantages for small practices are built into the MIPS scoring criteria. Specifically, small practices, rural practices, or practices located in geographic HPSAs can receive full credit in the IA component of MIPS by attesting to a single high-weighted or two medium-weighted activities (half the requirement of larger practices).

In addition, practices may be excluded from MIPS altogether if they do not see many Medicare patients or if they receive a low amount of Medicare Part B payments. Specifically, a low-volume threshold has been established such that if providers see fewer than 100 Medicare patients annually or submit less than $30,000 in Medicare claims, they are exempt from MIPS participation. For the 2019 MIPS payment adjustment, CMS will initially identify the low-volume status of individual eligible clinicians based on 12 months of data starting September 1, 2015, to August 31, 2016. The second determination period will be based on data starting September 1, 2016, to August 31, 2017. CMS will notify providers who meet this criteria by mail based on their address listed in the Provider Enrollment, Chain, and Ownership System. CMS also intends to provide a National Provider Identifier level lookup feature that will allow clinicians to determine if they are within the low-volume threshold.

In the future, small practices with 10 or fewer clinicians will be allowed to form virtual groups to streamline and increase the efficiency of the MIPS reporting requirements. Due to technological barriers associated with this new reporting method and the steps CMS has taken to shelter practices from penalties in the 2017 transition year, CMS has decided not to implement this option for at least the first year of the QPP.

Resources for ACS members

To assist Fellows in the transition to QPP, the ACS has created a variety of resources that explain the purpose and structure of the MIPS program and help to guide Fellows in choosing the level of participation that is right for their individual practice. Knowing what options are available is vital to navigating the new reporting requirements, making an informed value judgment, and ultimately achieving the best possible financial outcomes.

The ACS has created a set of tools to facilitate Fellows’ understanding of MACRA and the QPP. These tools can be found on the ACS website and include a series of short videos providing a historical background of MACRA, an overview of the MIPS program, more detailed explanations of the components making up the assessment for the final score in 2017, as well as a guide to choosing your level of participation. This site is reviewed and updated as new information becomes available. The College urges Fellows to use these resources and to contact the Division of Advocacy and Health Policy at quality@facs.org with questions.

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