How IR will succeed in the value-based payment paradigm
By Stephen L. Ferrara, MD, FSIR Fall 2016
In a rare and inspiring achievement of bipartisanship, Congress passed landmark physician payment legislation in 2015. The Medicare Access and CHIP Reauthorization Act (MACRA) repealed the highly flawed Sustainable Growth Rate (SGR) formula for physician payment, which perpetually threatened physicians’ economic existence whenever Congress delayed passing a stopgap “doc fix” measure to stave off 21 percent payment reductions. MACRA replaced SGR with the Quality Payment Program, which also aims to shift the U.S. health care system from a fee-for-service (FFS) to an outcome-based payment model.
How did we get here?
The impetus for payment reform stemmed not only from the fact that the SGR was fundamentally broken but also from a need to rein in health care spending. In 2014, the Centers for Medicare and Medicaid Services (CMS) spent almost $1 trillion on health care, or nearly one-fourth of the federal budget—exceeding the entire defense budget by more than 30 percent.1 Medicare’s share of this outlay was $597 billion. The United States has one of the highest levels of health care spending per capita in the world, due largely to the FFS payment model that reimburses medical providers for each service rendered. Conservative and liberal health care economists alike agree that the FFS model creates perverse economic incentives that promote increased volumes of health care services and, thus, health care spending. While most can agree that the spending issue is much more complex and multifactorial than simply FFS, policymakers have long desired to make the transition from volume to value. MACRA is the payment model that attempts to achieve that goal.
The ABCs of MACRA
For years, Congress was unable to successfully repeal SGR and abolish the volume-driven payment model. In response, CMS instituted a patchwork of programs in an attempt to tame runaway Medicare spending and infuse quality into the Medicare program—the Physician Quality Reporting System, Meaningful Use and the Value-based Payment Modifier.
Although well intentioned, these programs have largely failed to achieve their goals of improving quality and “bending the cost curve.” Rather, they have added to the administrative burden heaped on physicians, contributing to physician burnout.
MACRA endeavors to lighten physicians’ administrative yoke by streamlining quality reporting and establishing two simplified payment pathways under its Quality Payment Program: the Merit-based Incentive Payment System (MIPS) and advanced Alternative Payment Models (AAPMs).
The MIPS program brings the three fragmented quality reporting mechanisms under one umbrella and adds a fourth: Clinical Practice Improvement Activities (CPIAs).
Under MIPS, physicians earn positive or negative financial updates to their Medicare rate on the basis of a composite score in the four categories, with “quality” most heavily weighted in the first performance year and “resource use” (cost) gaining weight over ensuing years until it reaches parity with quality. The details of how the formula will be applied remain vague, complex and in flux. SIR is actively working with CMS during the ongoing rulemaking process to achieve clarity and reduce complexity (Figure 1).
The second payment track, AAPMs, represents the most innovative yet least developed component of MACRA. This payment system is preferred by Congress and CMS because it moves Medicare away from FFS.
The hallmark of an AAPM is that it mandates those on the health care delivery side to accept “in excess of nominal” financial risk. In other words, health care providers and systems must have “skin in the game” to qualify as an AAPM. There are several reasons to accept downside risk. AAPMs are less administratively burdensome in their reporting requirement and they have substantially more financial upside potential than MIPS. MIPS is budget neutral,” meaning that it’s a competitive, zero-sum game for physicians—there will be winners and losers because the budget must balance. The AAPM program, however, is not budget neutral. In theory, everyone can be a winner, including CMS. In addition to payment updates built onto the fee schedule chassis that underlies AAPMs, there are opportunities for added shared savings incentives. The primary obstacles right now are that there are only a handful of qualifying AAPMs, and those mostly cater to primary care.
Besides the acceptance of downside risk, the theme that underlies AAPMs is higher value care through better coordination. Familiar pilots include Accountable Care Organizations (ACOs), Patient-centered Medical Homes and bundled payment models. Spearheaded by the SIR Payment Research and Policy (PReP) Task Force and the Health Policy and Economics Committee, the society is working overtime to formulate strategies for interventional radiologists to succeed in this payment paradigm.
Already-approved AAPMs that hold promise for IRs center around dialysis and oncology pathways and new opportunities are actively being explored. If we want to be successful, the new models will require data that proves our value, a strong clinical practice model that emphasizes multispecialty collaboration and patient-centered approaches that include potential downside risk.
The law also provides for a new body known as the Physician-focused Payment Model Technical Advisory Committee (PTAC), whose role is to vet new AAPM proposals and expand the inventory of payment models to be more inclusive of specialists. SIR has provided feedback to CMS on suggestions that will improve PTAC’s ability to understand and equitably assess IR-germane AAPM proposals.
Can IR succeed under the MACRA payment paradigm? The answer depends on the individual IR and the willingness of practices to embrace change. But SIR has many tools and activities to help members adapt to the change and improve the chances of success.
The society is actively and aggressively engaging with CMS on behalf of member interests to respond to proposed rules and requests for information. SIR continues to educate CMS on who we are, what we do and how we differ from diagnostic radiologists. At the same time, SIR is emphasizing the economic and practical links between IRs and DRs within their practice groups that make some aspects of the latest proposed rule challenging. SIR is also communicating with other specialty organizations, such as the American College of Radiology and the American Medical Association, to reconcile variances and identify commonalities in order to strengthen our message and speak with a unified voice.
Through the tireless efforts of Jeremy Collins, MD, the Performance and Quality Improvement Committee worked with SIR’s service line leaders to formulate and gain approval of IR-unique quality measures. These measures are used today in the PQRS program and will directly carry over for use in the MIPS program. Jeremy Durack, MD, FSIR, led another charge that further sets the stage for MACRA success: creation of SIR-approved structured reports that will flow to Qualified Clinical Data Registries (QCDRs). In addition to fulfilling MIPS quality criteria, these activities will enable SIR to mine the necessary data to prove what until now we have only been able to perceive—that IR adds quantifiable value to the entire patient care experience. This information is key to successful negotiation of AAPM agreements and will make IR the “specialty of choice” in increasingly crowded clinical spaces where referring providers reap economic benefits by having the right specialist, do the right procedure, the right way.
The transition is just getting underway and there is much more to follow, but the timeline is short. Educational programs devoted to MACRA through online, print and in-person offerings, including a full-day MACRA “boot camp” on March 9, 2017, in conjunction with the SIR 2017 Annual Scientific Meeting in Washington, D.C. (March 4–9), will set members up to succeed under this new, complex system.
MACRA is here to stay, so the importance of self-education and engagement cannot be overstated. But it’s all about innovation and outside-the-box thinking—and what better specialty than IR to lead that transition?
1. Congressional Budget Office, Updated Budget Projections 2015–2025 (March 2015).
Quick takes: MACRA
- MACRA is the replacement policy for SGR. Built on the traditional fee schedule chassis, it sets the rules for the Medicare Part B physician fee schedule and eliminates the threat of a >20 percent reimbursement cut.
- MACRA contains two payment systems, MIPS and AAPMs. MIPS is a budgetneutral system that rolls up the three existing CMS value-focused programs and adds a fourth based on a set of clinical practice improvement activities. These four components are weighted to give each provider a merit-based composite score used to determine the annual payment update. Because it is budget neutral, there will be winners and losers and the potential upside and downside risks grow quickly over time (Figure 1).
- AAPMs comprise an evolving basket of innovative payment models that are not based on volume of services provided and require participants to accept downside financial risk with the opportunity to participate in shared savings. In addition to potential shared savings from the program, CMS also provides increasingly generous incentives to providers who participate in this payment track. CMS has pledged to have the vast majority of patients and dollars attributed through AAPMs by 2025.
- From 2015–2019, MACRA provides a “grace period” where the existing FFS system is in effect but the threat of a >20 percent reimbursement cut has been lifted. It guarantees a 0.5 percent positive update to the fee schedule each year during the grace period. All prior reporting systems remain unchanged. It is expected that specialties use this time to prepare for MIPS and AAPM’s which go live in 2019 based on a proposed performance period beginning Jan. 1, 2017.
What can I do now?
- Heed the call to use standardized reports and participate in IR registries, which are rolling out in the coming months. Registry participation fulfills quality reporting under MACRA and provides critical data needed to demonstrate the value that minimally invasive, image-guided procedures offer to patients.
- Respond to SIR member surveys. Information about you, your practice model, case mix, group size, etc. enables SIR to better represent you.
- Volunteer. This is an all-hands-on-deck evolution. Pooling the talented and innovative minds of IR will secure the brightest future.
Stephen L. Ferrara, MD, FSIR, is the SIR Health Policy and Economics councilor and chief of interventional radiology, VA Medical Center, Phoenix.