May 31 Deadline for 2017 Medicare Shared Savings Program

An organization interested in participating in the Medicare Shared Savings Program (MSSP) as an accountable care organization (ACO) must file a non-binding notice of intent (NOI) by 5:00 pm EDT Tuesday, May 31.  Only those organizations that file an NOI will be permitted to file an MSSP application, which will be due by 5:00 pm EDT Friday, July 29.

The NOI must be submitted electronically.  Detailed instructions are available on the MSSP website.  Keep in mind the NOI is non-binding; there is no prejudice to an organization that submits an NOI, but later elects not to file an MSSP application.  Nor is there any prejudice to an organization that files an MSSP application, but later elects not to sign a Participation Agreement.

Since the program’s inception in 2012, the number of MSSP ACOs has grown by approximately 100 each year.  We anticipate another bumper crop of MSSP ACOs this year, as physicians see the advantage of MSSP participation vis-à-vis the soon-to-be-launched Merit-Based Incentive Payment System, or MIPS.  A physician participating in an MSSP ACO will not be required to report separately on MIPS performance measures.  Instead, CMS will convert the ACO’s performance on the required MSSP quality measures into a MIPS composite score for participating physicians.  For a much more detailed explanation of how MIPS composite scores are calculated and how they impact physician payments, please see our earlier blog post on the MIPS proposed rule.

PYA has assisted numerous now-successful MSSP ACOs in evaluating the opportunity, filing the NOI, preparing and submitting an MSSP application, and establishing ongoing operations.  For more information, contact Martie Ross or David McMillan, (800) 270-9629.

MIPS Proposed Rule: Big Changes to Medicare Physician Payments Starting in 2017


Good news:  2016 is the last year physicians have to report performance measure scores to the Centers for Medicare & Medicaid Services (CMS) to avoid up to a 9% reduction in Medicare Physician Fee Schedule (MPFS) payments under the Physician Quality Reporting System (PQRS), the Value-Based Modifier Program, and the Meaningful Use Program.

Not-so-good-news:  A physician’s 2017 scores on measures in four weighted performance categories – quality, resource use, advancing care information, and clinical practice improvement activities – will dictate that physician’s 2019 composite performance score (CPS) under the new Medicare Incentive Payment System, or MIPS.  The CPS, expressed as a number from 1 to 100, will be used by CMS to determine the physician’s 2019 MPFS payment rate.  CMS also will report the physician’s score publicly on Physician Compare.

So what just happened?   Back on April 16, 2015, the President signed into law the Medicare Access and CHIP Reauthorization Act.  MACRA repealed the much-despised sustainable growth rate (SGR) formula for determining MPFS payments.  In its place, Congress directed CMS to implement MIPS as a new physician payment system that incentivizes quality and efficiency rather than merely rewarding volume.

A year later, on April 26, 2016, CMS published its much-anticipated 962-page MIPS proposed rule.  According to the agency, it has striven to “propose a program that is meaningful, understandable and flexible with a critical focus on transparency, effective communication with stakeholders and operational feasibility.”

The underlying MIPS concept is relatively straightforward:  a physician whose CPS is above the national performance threshold will receive an upward adjustment to his or her MPFS payments (up to 4% in 2019, increasing to 9% by 2023), while a physician whose CPS is below that threshold will be subject to a corresponding downward adjustment.  CMS’ proposed processes for identifying specific performance measures, compiling data and calculating each physician’s CPS, establishing performance thresholds, and making payment adjustments, however, are anything but straightforward. Continue Reading

Addressing Confusion Around Comprehensive Primary Care Plus


In the immediate aftermath of the Center for Medicare and Medicaid Innovation’s (CMMI) announcement of Comprehensive Primary Care Plus (CPC+), we have fielded numerous questions regarding the interplay of this new program with other Medicare initiatives.  Specifically, we have been asked how a provider should decide between participating in CPC+ and joining or continuing to participate in a Medicare Shared Savings Program (MSSP) accountable care organization.

The 2,188 providers in the 445 practices now participating in the predecessor to CPC+, the Comprehensive Primary Care Initiative (CPCI), applied for that program in 2011, prior to the launch of the MSSP.  Because CPCI providers are eligible to receive shared savings payments, they have not been eligible to participate in the MSSP.

Unlike CPCI, CPC+ does not have a shared savings component.  Instead, CPC+ providers will receive a prepaid incentive payment of $2.50 (Track 1) or $4.00 (Track 2) per beneficiary per month.  The provider will be required to repay some, or all, of this amount based on specified quality and efficiency measures scores.  Despite the lack of any shared savings payment, CPC+ providers will be prohibited from participating in the MSSP.

CMMI’s decision to prohibit dual participation in CPC+ and MSSP threatens to undo the significant gains many MSSP ACOs have made in care coordination and collaboration among primary care providers, specialist physicians, and other providers.  ACOs will now face the difficult challenge of proving to primary care providers – on which ACOs rely for beneficiary attribution – that waiting several months for any payout is a better deal than the immediate payment received under CPC+.  If unable to meet this challenge, these ACOs may be forced out of the MSSP, as they lose current primary care participants and are unable to recruit new primary care participants.

As we noted in our prior blog entry, this problem is compounded by the fact primary care providers will not know until late June or early July whether their region has been identified for CPC+ participation.  Thus, it is likely these providers will agree to participate (or continue to participate) in an MSSP ACO conditioned upon their selection for CPC+.  Such uncertainty makes it difficult for all parties to make the investments necessary for MSSP success.  Certainly this is not what CMMI intended with CPC+, but now it needs to deal with this unintended consequence head-on.

CMS Announces New Alternative Payment Model for Primary Care Providers

bird in the handBack in 2012, the Center for Medicare and Medicaid Innovation (CMMI) launched the Comprehensive Primary Care Initiative (CPCI), joining with 38 payers to support 500 practices across 7 regions in transforming primary care.  With CPCI scheduled to end later this year,  CMMI announced (April 11) the launch of its largest investment in advanced primary care to date: the Comprehensive Primary Care Plus (CPC+) model.

Application Process.  CPC+ is set to commence on January 1, 2017, and continue for five years.  To implement the program, CMMI is seeking commercial health plans and State Medicaid programs to participate.  Eligible payers must be willing to utilize a similar payment model (discussed below), align quality measures, and provide claims data to participating practices.  Interested payers must submit a proposal to CMMI by June 1, 2016.

CMMI then will select up to 20 regions to participate in CPC+ based on levels of payer participation.  Practices in these regions will have until September 15 to submit an application.  CMMI intends to have up to 5,000 CPC+ practices, 10 times the number of participants in CPCI.

Selected practices will use defined, stepwise requirements to develop the capacity to provide five comprehensive primary care functions: (1) access and continuity, (2) risk-stratified care management, (3) planned care for chronic conditions and preventive care, (4) patient and caregiver engagement, and (5) comprehensiveness and coordination of care. Continue Reading

2016 Medicare Physician Value Modifier Results – More of the Same

more-of-the-same-aheadWhat Happened in 2016?

The Centers for Medicare & Medicaid Services (CMS) has now released the official results for the second year of the Medicare Physician Value Modifier Program (VM Program).  Groups of 10 or more eligible professionals (EPs) are subject to adjustments in their 2016 Medicare Physician Fee Schedule payments based on their 2014 performance.

Last year, the VM Program impacted only those physician groups with 100 or more EPs. The 2015 VM Program impacted payments for a few hundred groups, many of which did not even qualify for tiering under the VM Program because they failed to successfully participate in the Physician Quality Reporting System (PQRS). The total dollar amount for funds that were shifted from poor to high performers was just over $11 million.

The 2016 results are consistent with the 2015 results, with one major exception: the program has impacted many more groups. Compared to 2015, there are significantly more groups that will experience a payment reduction in 2016. This year, it is projected that nearly $80 million will be redistributed from poor to high performers. Continue Reading

CMS Proposes Changes to Part B Drug Payments

19941On March 8, 2016, the Centers for Medicare & Medicaid Services (CMS) released its proposal to test new ways to pay for Part B drugs.  Presently, Medicare pays the average wholesale price (AWP) plus 6% for a Part B drug administered by a physician, durable medical equipment (DME) supplier, or hospital outpatient department.  For example, if a physician administered a drug with an AWP of $100, Medicare would pay the physician $106 plus a separate administration fee.

Concerned that the AWP+6% payment rate may lead providers to favor higher-priced drugs over their equally effective lower-priced counterparts,  CMS proposes to test whether changing the payment rate to AWP+2.5% plus a flat fee of $16.80 per drug per day would change prescribing habits.  CMS also wants to study whether the use of certain value-based purchasing tools now used successfully by commercial payers would have a similar effect. Continue Reading

Transition to Alternative Payment Models Ahead of Schedule

smart-goals1In January 2015, the Department of Health and Human Services (HHS) set an ambitious goal of having 30% of Medicare fee-for-service payments tied to alternative payment models (APMs) by the end of 2016.  On March 3, 2016, HHS announced this goal had been achieved nearly a year early, with roughly $117 billion of a projected $380 billion in payments going to APM participants.  According to HHS, these “estimates were evaluated by the independent Centers for Medicare & Medicaid Services (CMS) Office of the Actuary and found to be sound and reasonable.”

HHS also marked the one-year anniversary of the launch of the Health Care Payment Learning and Action Network (LAN).  Now numbering more than 5,000 participants, the LAN helps align initiatives across the private, public, and non-profit sectors. The LAN is accelerating the transition to APMs by supporting collaboration between HHS, private payers, large employers, providers, consumers, and state and federal partners.

According to HHS, the LAN’s first-year accomplishments include:

  • Serving as a convener to facilitate joint implementation and expansion of new payment and delivery models.
  • Building consensus around methods to facilitate the transition to alternative payment models.
  • Collaborating to generate evidence, share approaches, and remove barriers.
  • Developing common approaches to beneficiary attribution, financial models, benchmarking, and risk adjustment.
  • Creating implementation guides for payers and purchasers.

Importantly, the LAN has developed an APM Framework, categorizing the different types of APMs to facilitate a common understanding of payment reform initiatives.

HHS now faces its more ambitious goal of having 60% of Medicare fee-for-service payments tied to APMs by the end of 2018, with commercial payers pursuing similar targets.  Providers should expect to see all payers pushing these models, using both carrots and sticks to increase participation.

In the face of these dramatic changes, providers should remain focused on the basic core competencies necessary to succeed in an APM:  understanding the risk in the population served, learning to manage total cost of care, and enhancing operational efficiency.  Regardless of the specific APM in which a provider may participate, these core competencies are the keys to success.

Diagnosis Codes Matter: Documenting Risk as the Foundation of Your Population Health Management Strategy

foundation-large-size-300x200Under traditional fee-for-service reimbursement, a patient’s diagnosis (i.e., medical necessity) determines whether his or her health insurance will cover a specific service. However, assuming coverage is available, the amount a provider receives in payment does not depend on the patient’s overall health status. Thus, there is limited incentive for a provider to document a patient’s condition with a high degree of specificity, beyond what is needed to demonstrate medical necessity.

Under emerging alternative payment models (APMs) – such as shared savings programs and bundled payments – the benchmark amount that determines the provider network’s payments is based on the health status of the population served. Thus, there is strong need for a provider participating in an APM to document each patient’s condition as accurately and specifically as possible.

Additionally, under value-based reimbursement programs which adjust fee schedule payments based on a physician’s score on specified performance metrics, the overall health status (acuity) of the physician’s patient panel directly impacts those scores. Therefore, when the provider’s documentation is both accurate and specific, the carrier has a better determination as to the health status of the physician’s population and can then reimburse appropriately.

And finally, the documented condition is used to assign hierarchical condition categories (HCC) which are used to determine payments under capitated models such as Medicare Advantage.

To navigate the transition to value-based reimbursement and to prepare for population health management, providers must focus on accurately “capturing” the risk in the populations they serve. This means overcoming the most common coding and documentation errors:

  • Lack of specificity in physician documentation resulting in an unspecified code.
  • Medical record documentation supports a more specific code than the reported ICD-10 code .
  • Discrepancies between the diagnosis codes billed and the written diagnosis description in the medical record. (The billed diagnosis code and the diagnosis written in the medical record should mirror each other.)
  • Lack of documentation indicating that the diagnoses billed on the claim are being monitored, evaluated, assessed/addressed, and/or treated .
  • Chronic conditions (e.g., hepatitis, renal insufficiency) not documented as chronic, resulting in the billing of an unspecified or acute condition instead.
  • Missing link or causal relationship for diabetic complications, and/or failure to report a manifestation code.
  • Missing signature and/or valid credentials from an appropriate physician or other provider.

In the place of these poor documentation and coding habits, providers should develop new habits that include the following:

  • Assess and report all chronic conditions annually (e.g., chronic renal failure, diabetes).
  • Indicate co-existing acute conditions.
  • Indicate all conditions that are being treated when prescribing medications.
  • Document the level of specificity needed for the appropriate code selection. Avoid using unspecified codes as these may lead to unnecessary denials (e.g., diabetes w/renal manifestation).
  • Always indicate:

-Status (stable/unstable/improving).
-Recent test results.
-Medication changes.

  • Document all existing chronic and acute illnesses in the medical record; have an assessment and plan of care for each.
  • Watch for documentation errors regarding the use of “history of” (e.g., coding a past condition as active, or coding history of when the condition is still active. History of means the patient no longer has the condition (e.g., a patient with no evidence of cancer, who previously had an active cancer diagnosis).

Like most others, physicians often fall into habitual coding patterns, particularly related to diagnosis coding. While ICD-10 implementation challenged those habits, physicians still have the option to choose non-specific diagnosis codes. As the value-based reimbursement models roll out, there will be financial implications tied to appropriate diagnosis coding.   Providers who choose non-specific codes may receive lower reimbursement due to lower perceived patient acuity. Conversely there is risk that providers may inappropriately embellish a patient’s diagnosis codes to achieve higher scores and reimbursement.

To prepare for these risks, physicians (and organizations employing physicians) should evaluate the accuracy and the specificity of documentation and coding now to address any deficiencies and leverage best practices. This is best accomplished through coding, documentation, and medical necessity reviews followed by targeted physician education, and, of course, ongoing monitoring.

PYA’s compliance team can support your organization in developing, maintaining, and monitoring processes related to appropriate coding, documentation, and medical necessity while accurately identifying patient risk. For help building your foundation for population health management, please contact a related author below at PYA, (800) 270-9629.

Meaningful Use Update: New Deadline and Streamlined Process to Apply for Hardship Exemption

Created by the American Recovery and Reinvestment Act of 2009 (ARRA), the Electronic Health Record (EHR) Incentive Program – commonly known as “Meaningful Use” – offered incentive payments beginning in 2011 for eligible physicians who attested to meaningful use of an EHR, as defined by regulations.  Those carrots, however, soon turned into sticks.

WordleAn eligible physician who did not attest to meaningful use or receive a hardship exception for 2013 saw a 1% penalty on all 2015 Medicare Physician Fee Schedule payments.  Those who failed to attest or receive a hardship exception for 2014 now are being penalized 2% in 2016.

To avoid the 3% penalty in 2017, eligible physicians must attest to having met the Modified Stage 2 Meaningful Use requirements for 90 consecutive days during calendar year 2015.  However, the Centers for Medicare & Medicaid Services (CMS) did not finalize those requirements until October 16, 2015, meaning that physicians did not have notice of the revised program requirements until less than 90 days remained in the calendar year.

CMS stated that it would grant hardship exemptions to those eligible providers unable to attest due to the lack of timely notice.  Under ARRA, however, a physician must submit a detailed application with supporting documentation to secure a hardship exemption, which CMS is required to review and approve on a case-by-case basis.

With the passage of the Patient Access and Medicare Protection Act in late December 2015, however, Congress authorized CMS to grant blanket hardship exemptions for those physicians who apply in a timely manner.  On February 26, 2016, CMS released the much-anticipated instructions and application for the blanket hardship exemption.  The deadline for submission of the completed application is July 1, 2016, (as opposed to the March 15 date previously announced).

The application requires completion of basic contact information for the individual submitting the form, a check-the-box “Circumstances of Significant Hardship,” and the name and National Provider Identifier (NPI) for each physician on whose behalf the application is being submitted.  For physicians claiming lack of adequate notice as the basis for not achieving meaningful use in 2015, the applicable checkbox is Section 2.2.d, “EHR Certification/Vendor Issues.”

CMS strongly encourages electronic submission by attaching the completed application to an e-mail directed to Hardship determinations will be returned via email to the address listed on the application form.

If granted, the hardship exemption will apply only for the 2017 adjustment year.  A physician still must achieve meaningful use in 2016 to avoid the 3% penalty in 2018.

As CMS’ Acting Administrator Andy Slavitt stated publicly January 11, Meaningful Use as we know it will come to an end in 2016, with the last physician penalties to be assessed in 2018.  In its place, the Merit-Based Incentive Payment System (MIPS), Medicare’s new physician value-based purchasing program, will go into effect January 1, 2019.

Under MIPS, each provider receiving payment under the Medicare Physician Fee Schedule will be assigned a composite score of 1 to 100 based on four categories of performance measures:  quality (30% of the composite score), efficiency (30%), meaningful use of an EHR (25%), and clinical practice improvement activities (15%).  Physicians with higher scores will receive bonus payments, while those with lower scores will be subject to penalties.

CMS is now beginning the process of identifying the specific measures to be incorporated into each MIPS category, including meaningful use of an EHR.  Expect those requirements to be consistent with the Stage 3 Meaningful Use requirements which were published at the same time as the Modified Stage 2 requirements.

Over the next several months, we will delve deeper into MIPS, explaining in detail this new program’s impact on specialist physicians.  For now, however, stay on target to meet the Modified Stage 2 Meaningful Use requirements for 2016 to avoid the 3% penalty in 2018.