Alternative Payment Models

Surgeons who participate in Medicare may have noticed a growing emphasis in recent years on the role of Alternative Payment Models (APMs). The Patient Protection and Affordable Care Act (ACA) of 2010 created the Center for Medicare and Medicaid Innovation (CMMI) within the Centers for Medicare & Medicaid Services (CMS), with the goal of testing, evaluating, and implementing new payment models. The U.S. Department of Health and Human Services (HSS) in January 2015 also set a goal of tying 50 percent of Medicare physician payments to quality through an APM by 2018. More recently, Congress passed the Medicare Access and CHIP (Children’s Health Insurance Program) Reauthorization Act (MACRA) of 2015, which created incentives for physicians to participate in APMs and a pathway for development of new payment models.

Although the relevance of APMs has grown, models that recognize the importance of surgeon leadership and the team-based nature of surgical care have been lacking, leaving many surgeons without meaningful opportunities for participation. In response, the American College of Surgeons (ACS) is in the beginning stages of a multi-year effort to develop a new model known as the ACS-Brandeis Advanced-APM (A-APM) proposal.

What are APMs?

APMs provide a model for paying physicians that differs from the traditional fee-for-service construct. The goal of APMs is to improve the quality and value of care provided, reduce growth in health care spending, or both. On the Quality Payment Program (QPP) website, CMS describes APMs as payment models that create incentives for clinicians to provide high-quality, cost-efficient care for a specific clinical condition, episode of care, or population.

What is a MIPS APM?

CMS created a separate scoring standard in the Merit-based Incentive Payment System (MIPS) for certain APMs to avoid duplicative data reporting requirements for MIPS-eligible clinicians. The models to which this scoring standard applies are referred to as MIPS APMs. To be considered a MIPS APM, participating entities must maintain a participation list of MIPS-eligible clinicians, base payment incentives on clinicians’ performance with respect to cost and quality measures, and maintain a participation agreement with CMS or otherwise be approved as a model by law or regulation.

What is an A-APM?

MACRA created incentives for participation in certain qualified APMs that require participating entities to accept more financial risk, use certified electronic health record technology (CEHRT), and adjust payment based on quality measures equivalent to those in MIPS. CMS created the designation A-APMs, which is essentially a subset of APMs that have been certified by CMS to meet these three requirements.

What A-APMs are currently available?

CMS has approved the following A-APMs for the 2017 performance year:

  • Comprehensive End-Stage Renal Disease Care—Two-Sided Risk
  • Comprehensive Primary Care Plus
  • Next Generation Accountable Care Organizations
  • Medicare Shared Savings Program Tracks 2 and 3
  • Oncology Care Model—Two-Sided Risk
  • Comprehensive Care for Joint Replacement Payment Model Track 1 with CEHRT requirements

Other models may still be added for 2017, and additional models, including some recommended by the Physician-Focused Payment Model Technical Advisory Committee (PTAC), are expected to emerge in the future.

Why should surgeons participate in an APM or A-APM?

Surgeons should consider participating in an APM or A-APM, if one is available, for a number of reasons. First, these models may provide tools for improving clinical patient care and lead to increased efficiency. Furthermore, for MIPS-eligible clinicians, the reporting requirements are different for those participating in a MIPS APM and may be less burdensome. Depending on the payment model, shared savings or other financial incentives for participation may also be available. Surgeons who see enough patients or receive enough payments through A-APMs are considered qualified APM participants and are exempt from the MIPS program. For payment years 2019–2024 (based on performance in 2017–2022), these qualified clinicians will receive a lump sum incentive payment equal to 5 percent of their previous year’s Medicare Part B charges.

What is the PTAC?

To provide more opportunities for physicians to participate in APMs, Congress created the PTAC as part of MACRA. This 11-member panel reviews APMs proposed by stakeholder groups, including the ACS and others, and makes recommendations to the Secretary of the HHS regarding whether the model should be tested or implemented. The PTAC began accepting proposals in late 2016, and the ACS submitted the first proposal in December 2016.

What is the ACS-Brandeis A-APM proposal?

The ACS-Brandeis A-APM proposal was developed by the ACS and a team at Brandeis University, Waltham, MA. It uses software known as the Episode Grouper for Medicare to group Medicare claims into episodes of care, which can then be risk-adjusted based on the care the individual patient has received or is receiving to set a patient-specific target price. Responsibility for care is automatically attributed to various providers based upon their role in delivering health care services to the patient, determined through claims filed.

The ACS-Brandeis A-APM recognizes the team-based nature of surgical care and is flexible, allowing providers to design the care pathways that work best for each patient and practice. Quality is measured through an episode-based measure framework based on the College’s Surgical Phases of Care concept. Health care professionals who provide quality care would be eligible to share in savings and, because the model is designed to meet the A-APM criteria, may qualify for the 5 percent incentive payment.

What is the status of the ACS-Brandeis A-APM?

The ACS-Brandeis A-APM was among the first two models that the PTAC approved at its April 2017 meeting. The PTAC sent its formal recommendation to HHS Secretary Tom Price, MD, on June 6. It is now up to the Secretary to decide how best to implement the model in Medicare. ACS staff will continue to update Fellows on the status of the ACS-Brandeis model and other APM opportunities that may be of interest.

Where can I learn more about APMs?

For information on APM options in the Medicare program, including approved A-APMs, visit the CMS QPP page dedicated to APMs. More information on the PTAC, including the ACS-Brandeis A-APM proposal and the PTAC’s letter of recommendation to Secretary Price, can be found on the PTAC website. The CMMI website has information about models currently being tested, including opportunities for enrolling in certain models. Finally, the College will continue to provide updates on the ACS-Brandeis A-APM and other models available to surgeons both in the Bulletin and on the College’s website.

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