MIPS Final Rule: Who’s In, Who’s Out, and Who Cares?

On October 14, 2016, the Centers for Medicare & Medicaid Services (CMS) published its final rule implementing the new Medicare Quality Payment Program, including the Merit-Based Incentive Payment System, or MIPS.  In response to providers’ concerns, CMS has made significant modifications to the proposed rule to ease program implementation.  Specifically, CMS has made four key changes in this regard:

(1)        Revised the low-volume threshold for MIPS exclusion

(2)        Established minimum reporting requirements to avoid penalties

(3)        Eliminated the cost performance component from the calculation of the composite performance score

(4)        Reduced the number of required measures on which to report

Keep in mind these changes apply to the 2017 performance year only, as CMS intends to ramp up the program in the following two years.  CMS will establish the rules for the 2018 performance year in 2017 through the normal rulemaking process.

(1)        Revised the low-volume threshold for MIPS exclusion 

Under the proposed rule, CMS would have excluded from MIPS any individual clinician or group practice that had less than or equal to $10,000 in Part B allowable charges and provided care for less than or equal to 100 Part B-enrolled beneficiaries.  Based on historical data, CMS estimated 225,615 clinicians (identified by TIN/NPI) would be excluded from MIPS under this low-volume threshold.  (CMS did not revise the definition of “clinician” for purposes of MIPS; it still includes all Part B-enrolled physicians (MD, DO, DDS, and DC), nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, and physician assistants.)

In the final rule, CMS revised the low-volume threshold to exclude from MIPS any individual clinician or group practice with less than or equal to $30,000 in Part B allowable charges or less than or equal to 100 Part B-enrolled beneficiaries.  According to CMS, a total of 383,525 clinicians would be excluded from MIPS under these criteria, or 157,910 more than under the proposed rule.  This represents 32.5% of all clinicians and 27.7% of all MDs and DOs, largely primary care providers and those specialists serving younger populations (e.g., pediatricians, OB/GYNs).

When one accounts for the other two MIPS exceptions – providers newly enrolled in Part B and Qualifying APM Participants – in addition to the low-volume threshold, the total number of clinicians excluded from MIPS in 2017 is just over 40% (or about 35% of all MDs and DOs).

In the final rule, CMS also defined the low-volume threshold determination periods for the 2017 performance year.  Initially, CMS will use data from September 1, 2015, to August 31, 2016, with a 60-day claims run-out to identify and then notify excluded clinicians and group practices prior to the start of the performance year (or soon thereafter).  Then, to account for changes occurring during the performance year, CMS will use data from September 1, 2016, to August 31, 2017, with a 60-day claims run-out to identify additional excluded clinicians and group practices.

CMS notes the low-volume threshold exclusion will be applied at the individual clinician (NPI/TIN) level for those reporting individually, and the group practice (TIN) level for group reporting.  A clinician may qualify for the exclusion at the individual (TIN/NPI) level, but if that clinician is part of a group that does not meet the criteria, he or she will be required to participate in MIPS as part of the group.

(2)        Established minimum reporting requirements to avoid penalties 

For the 2017 performance year, individual clinicians and groups subject to MIPS have four reporting options, each with corresponding consequences:

Penalty on 2019 MPFS Payments

Under the MIPS final rule, most physicians’ MPFS payments will be higher in 2019 as compared to 2018, at least when considering the following circumstances:

  • First, a physician who does not report through the current Physician Quality Reporting System on 2016 performance will face a 6% penalty on MPFS payments in 2018. As a result of the final rule, however, a physician who does not report through MIPS on 2017 performance will only be subject to a 4% penalty on 2019 MPFS payments.
  • Second, the Meaningful Use Program will sunset in 2016, meaning physicians no longer will be subject to a 3% penalty for failure to attest after 2018. The maximum penalty to which a physician may be subject in 2018 for lack of attestation will be 9%, but only 4% in 2019.
  • Finally, more physicians will be eligible for bonus payments under MIPS as compared to the current Physician Value Modifier Program due to the manner in which bonuses are calculated.

(3)        Eliminated the cost performance component

In the Medicare Access and CHIP Reauthorization Act of 2015, Congress directed CMS to calculate MIPS composite performance scores using the formula:   30% quality performance, 30% cost performance, 25% advancing care improvement, and 15% clinical practice improvement activities.  However, Congress afforded CMS some flexibility in implementing MIPS.

Initially, CMS proposed to phase in the cost performance component, starting with 10% in 2017 and increasing up to 30% by 2019.  Now in the final rule, CMS has set the cost performance component at zero for 2017, 10% for 2018, and 30% in 2019.  To balance the equation, CMS has increased the quality performance component to 60% for 2017 and 50% for 2018.

Calc MIPS Composite Perf Score

CMS still will calculate clinicians’ scores on specific cost performance measures and give that information in feedback reports to clinicians.  These measures include a total per capita cost for all attributed beneficiaries, Medicare spending per beneficiary measures, and ten episode-based measures.  CMS previously calculated these measures at the practice group level for inclusion in the Quality and Resource Use Reports (QRUR) distributed as part of the Physician Value Modifier Program.

(4)        Established fewer required measures on which to report

Quality Performance Component.  CMS had proposed to require clinicians and groups to report on (1) six quality measures, including one cross-cutting measure (except for non-patient-facing clinicians) and one outcome measure (or an additional high-priority measure if no outcome measure is available); or (2) one specialty-specific or subspecialty-specific measure set.

In the final rule, CMS has eliminated the requirement to report on a cross-cutting measure.  While still encouraging clinicians to perform and submit data on these measures, CMS recognized these cross-cutting measures are not always meaningful for all clinicians.

Clinical Practice Improvement Activities Component.  CMS has reduced the number of activities on which most clinicians must report from six to four.  Groups with 15 or fewer participants and clinicians practicing in rural and health professional shortage areas only will have to report on two activities.

For group reporting, a group may include a specific activity (and thus all clinicians in the group will receive credit) if at least one clinician in the group has been engaged in that activity.   And, one can report on existing initiatives; it is not necessary for a clinician or group to engage in a new endeavor to receive credit.

Also, participants in certified patient-centered medical homes, comparable specialty practices, or an alternative payment model designated as a medical home model will automatically receive full credit for this component.  For 2017, participants in MIPS APMs (including the Medicare Shared Savings Program [all tracks] and the Oncology Care Model) also will receive full credit.

Advancing Care Information (ACI) Component.  Under this component – the successor to the Meaningful Use program – CMS had proposed requiring reporting on 11 measures, but now has reduced that number to 5.

CMS also has changed the definition of “hospital-based” clinicians (who are not required to submit data under the ACI component) to include those clinicians who perform at least 75% of covered professional services in a hospital inpatient, on-campus hospital outpatient, or emergency department setting.  CMS will make this determination based on claims for a specified period prior to the performance year.

Finally, non-physician practitioners – regardless of where they practice – may elect not to submit data under the ACI component, in which case it will be re-weighted as 0%.  CMS has recognized these clinicians may require additional time to meet the requirements of the ACI component, given they were not subject to the Meaningful Use program.

There’s one final point to share regarding the transition to MIPS.  As noted above, a clinician may avoid MIPS if he or she participates in an advanced alternative payment model (APM).  However, CMS’ proposed list of advanced APMs included only a handful of Medicare pilot programs.  CMS received numerous comments urging the agency to expand the list.  In response, CMS did not include any additional advanced APMs, but promised the agency would be offering new opportunities over the next year, such as reopening the application period for the Comprehensive Primary Care Plus program and creating a new Track 1+ for the Medicare Shared Savings Program.

There is, of course, much more to the 2,400-page final rule than the easing of the transition to MIPS including, but not limited to, a thorough explanation of how data is to be reported, how the composite performance scores will be calculated and made publicly available, and how payment adjustments will be made.  Plus, there’s still more to come:  CMS promises to publish baseline scores for all measures to be used in calculating clinicians’ and groups’ scores prior to the start of the performance year, i.e., January 1, 2017.

The answer to the last question—“Who cares?”—should not be any different from the answer prior to the publication of the final rule.  Although CMS has done much to ease the transition to MIPS, clinicians and group practices should not pull back on their preparations.  Even with many requirements scaled back for the first performance year, MIPS still will fundamentally change how physicians and other clinicians are paid and evaluated by patients, peers, and payers.  Now is the time for providers to gain a working knowledge of MIPS and begin evaluating strategies for success.

With our MIPS Mastery™ program, PYA can help your organization succeed under this new value-based payment model.  MIPS Mastery™ cuts through the regulatory complexity to bring a common-sense approach to the MIPS challenge, including education, strategy, and application.

MIPS Graphic2

To discuss how PYA can guide your organization on its MIPS journey, contact Martie Ross or Lori Foley at (800) 270-9629.

MIPS Pick Your Pace: What Will You Choose to Do?

runners-760431_960_720In response to complaints that the planned January 1, 2017, launch date for the new Medicare Merit-Based Incentive Payment Program (MIPS) is too much too fast, CMS Acting Administrator Andy Slavitt announced in a September 8 blog post the “Pick Your Pace” opportunity.

According to Mr. Slavitt, MIPS-eligible clinicians – including nearly all physicians and non-physician practitioners participating in Medicare Part B – will have four options in 2017.

Option 1:       Report “some” data to avoid the MIPS penalty.

In what appears to be a variation on the current Physician Quality Reporting System (PQRS), a MIPS-eligible clinician can avoid any MIPS penalty on 2019 Medicare Physician Fee Schedule payments by submitting “some” data.  By selecting this option, a clinician forgoes the opportunity to earn any bonus payment.

Mr. Slavitt offers no insight on what “some” data may include.  Nor does he explain whether CMS will calculate and publish a MIPS composite performance score for clinicians who select this option.  These details will not be revealed until CMS publishes the MIPS final rule prior to November 1, 2016, (and we will not venture to guess whether it will be a “trick” or a “treat”). Continue Reading

Making a Go/No-Go Decision on CPC+: Key Factors to Consider

On August 1, the Center for Medicare & Medicaid Innovation (CMMI) announced the 14 regions that will be part of the Comprehensive Primary Care Plus (CPC+) program.  These include the 7 regions now participating in the Comprehensive Primary Care Initiative (now known as “CPC Classic”) and 7 new regions.

Primary care practices located in the 14 regions have until September 15 to submit an application to participate in CPC+ beginning January 1, 2017, and ending December 31, 2021.

PCPs to Participate in CPCplus

Each practice’s decision of whether to apply for CPC+ requires careful consideration of several factors in light of its specific facts and circumstances.  Here, we summarize the key factors and offer some direction for eligible practices’ decision-making.

Number of participating practices.  CMMI will select up to 5,000 practices to participate in CPC+, with preference given to current CPC Classic practices (of which there are approximately 450).

For purposes of CPC+, CMMI defines “practice” as a physical delivery site at which primary care practitioners (defined as physicians, advanced practice registered nurses, clinical nurse specialists, and physician assistants with a specialty designation of general, family, internal, or geriatric medicine) furnish services.  A group practice with multiple practice locations, therefore, will need to submit a separate application for each location wanting to participate in CPC+ (even if all locations bill under the same TIN).  If a practitioner provides services at more than one such location, the group practice must elect which location under which he or she will be listed for purposes of CPC+.

A multi-specialty group practice is eligible to participate in CPC+, but only the group’s primary care physicians will be considered for purposes of patient attribution (more on the how and why of patient attribution below).

CMMI makes no guarantee that all applicants with the same TIN will be accepted into the program.  If CMMI receives more qualified applicants than available slots, it will select participants based on its desire to test the model in multiple practice settings, e.g., geographic location, population served.

Track 1 vs. Track 2.  A practice may apply to participate in Track 1 or Track 2.  Track 2 is intended for practices with greater experience with practice transformation activities.  These practices will receive additional payments in exchange for meeting more demanding program requirements.  CMMI intends to accept 2,500 practices into each track.  A practice applying for Track 2 must indicate whether it is willing to participate in Track 1 if CMMI determines the practice does not meet the requirements for Track 2.

Practice eligibility.  To be considered for CPC+, a practice must meet the following requirements:  (1) presently utilize a certified electronic health record (CEHRT); (2) have experience with specified practice transformation activities; (3) have at least 150 attributed traditional Medicare beneficiaries; (4) not charge any sort of concierge fees to Medicare beneficiaries; and (5) not be a present participant in certain other CMMI initiatives (i.e., Accountable Care Organization [ACO] Investment Model, Next Generation ACO Model, and Comprehensive ESRD Care Model).

Practice transformation experience.    To qualify for Track 1, a practice must certify that it has experience (1) assigning patients to provider panels; (2) providing 24/7 access for patients; and (3) supporting quality improvement activities.

For Track 2, a practice must also have experience (4) developing and recording care plans; (5) engaging in post-discharge follow-up for emergency room visits and hospital discharges; and (6) maintaining processes to link patients to community-based resources.

Beneficiary attribution.  CMMI will attribute to a CPC+ practice those traditional Medicare beneficiaries for whom its practitioners either (a) provided the plurality of primary care services in the most recently available 24-month period (based on allowed charges), or (b) are the most recent provider of chronic care management services.  For practices participating in the Medicare Shared Savings Program (MSSP), its CPC+ attributed beneficiaries likely will be different from its MSSP attributed beneficiaries, given minor differences in the attribution models.

CMMI will provide a participating practice with a list of attributed beneficiaries near the beginning of the performance period.  That list then will be updated quarterly based on billings for the then-most-recent 24-month period.  CMMI attributes beneficiaries by practice, not by individual practitioner.  Thus, the departure of a practitioner from a practice will not immediately impact that practice’s beneficiary attribution.

The number of beneficiaries attributed to a practice determines the amount the practice will receive in care management fees and performance-based incentive payments (discussed in the following section).

While a multi-specialty practice is eligible to participate in CPC+, CMMI will only consider the practice’s primary care physicians in determining attribution, and thus the amount of funding received by the practice.

Care Management Fee.  A CPC+ practice will receive a per-beneficiary-per-month (PBPM) care management fee.  The fee is not subject to beneficiary cost-sharing requirements.

The amount of the fee depends on the degree of risk in the practice’s attributed beneficiaries measured by hierarchical condition categories, or HCCs:


CMMI will establish the range of HCC scores for each tier based on regional data.

Participating practices will be required to report on their spending of care management fees, which are to be used to fund required practice transformation activities (e.g., technology, staff, training).  Track 2 practices receive higher PBPM payments due to the additional requirements for these practices.

While a CPC+ practice may bill for transitional care management, it cannot bill for chronic care management for those beneficiaries for which the practice receives a CPC+ care management fee.  Subsequent to the announcement of CPC+, CMMI proposed expanded reimbursement for care management services under the Medicare Physician Fee Schedule, including complex chronic care management and care plan development.  At present, CMMI has not stated whether CPC+ practices will be precluded from billing under these new codes.

Performance-Based Incentive Payment.  CPC Classic practices had an opportunity to earn shared savings if they were successful in reducing the total cost of care for their attributed beneficiaries.  CPC+ replaces shared savings with performance-based incentive payments.

In addition to the care management fee, a CPC+ practice will receive a second PBPM payment to incentivize improved quality and efficiency.  Again, Track 2 practices will receive higher payments:


However, a CPC+ practice may be required to refund all or a portion of this payment to CMMI depending on the practice’s score on specified performance measures.  Thus, CMMI considers this payment to be “at risk,” given this repayment requirement.

Initially, CMMI had proposed that practices participating in the Medicare Shared Savings Program would not be eligible to participate in CPC+.  In response to harsh criticism, CMMI moderated its position, deciding to allow up to 1,500 MSSP-participating practices into CPC+.  However, these practices will not receive the performance-based incentive payment.

CMMI has proposed the following performance metrics for CPC+ practices, although these metrics are subject to change.  CMMI has not specified the scores a practice must attain on these metrics to avoid repayment of the performance-based incentive payment, and it likely will not do so prior to the application deadline.


Track 2 Practices Only:  Comprehensive Primary Care Payments.  Track 1 practices will continue to bill and collect fee-for-service (FFS) payments for evaluation and management (E/M) services as usual.  Track 2 practices also will continue to bill as usual, but the FFS payment will be reduced to account for shifting a portion of the payment into Comprehensive Primary Care Payments (CPCPs) to be paid in a lump sum to participating practices on a quarterly basis.

With the hybrid payment, CMMI hopes to find the “sweet spot” between reduced FFS payments and “upfront” payments to incentivize site-of-service neutrality.  A practice’s CPCP will be calculated based on its historical revenue.  In making this calculation for 2017, CMMI will inflate the practice’s historical revenue by 10% to account for the increased depth and breadth of primary care services required under Track 2.

Taken together, the CPCP and reduced FFS payments are designed to increase participating Track 2 practices’ revenues by 4% to 6.5% over historical revenues.  Practices that elect to receive 40% of payments upfront will see a 4% bonus, while those electing 65% upfront (and thus receiving lower FFS payments) will receive a 6.5% bonus.  These bonuses are in addition to the care management and performance-based incentive payments.

Track 2 practices will have the option of easing into CPCP payments during the first two years, according to the following schedule from CMMI’s CPC+ Request for Applications:


The CPCP payments have some strings attached.  CMMI will monitor whether a practice’s attributed beneficiaries receive primary care services from other practices, using this information as a marker that the CPC+ practice is not providing adequate care.  If CMMI identifies an issue, it will recoup all or a portion of the CPCP from the practice.

Practice Transformation Activities.  During its five years of CPC+ participation, a practice will be required to improve its functionality in five areas:  (1) access and continuity; (2) care management; (3) comprehensiveness and coordination; (4) patient and caregiver experience; and (5) planned care and population health.  CMMI will regularly update practice requirements in each area, with Track 2 practices expected to perform at a higher level.

In the CPC+ Request for Applications, CMMI offers the following examples of the types of practice requirements to which CPC+ practices may be subject; the initial list will be finalized by the time practices are required to sign formal participation agreements.  Again, CMMI intends to increase the complexity and intensity of these requirements over time.


Advanced HIT.  All CPC+ practices must meet the following minimum requirements for the use of health information technology:  (1) adopt certified health IT modules to meet CEHRT (including upgrading to the 2015 edition by January 1, 2018); (2) use the latest eCQM specifications for all CPC+ measures (including all annual updates); and (3) adopt technology that allows filtering of data by practice site location and by individual NPI/TIN.

Track 2 practices also must complete the following health IT enhancements by no later than January 1, 2019, (more fully detailed in Appendix C of CMMI’s CPC+ Request for Applications):

  1. Risk stratify practice site population; identify and flag patients with complex needs
  2. Produce/display eCQM results at practice level
  3. Systematically access patients’ psychological needs and inventory resources and support to meet those needs (requiring the adoption of certified health IT that meets the 2015 “Social, Behavioral, and Psychological Data” criterion)
  4. Document/track patient reported outcomes
  5. Empanel patients to practice/site care team needs
  6. Establish patient-focused care plan (requiring the adoption of certified health IT that meets the 2015 “Care Plan” criterion)

To demonstrate its ability to meet these requirements, a practice applying for Track 2 must submit a signed letter of support from its HIT vendor(s) that the vendor will work with the practice to satisfy the requirements in a timely manner by either optimizing the practice’s electronic health record or providing other health IT solutions.

Merit-Based Incentive Payment System.  In the proposed rule implementing the Merit-Based Incentive Payment System (MIPS), CPC+ is identified as an Advanced Alternative Payment Model (APM), meaning a practitioner participating in the program may qualify for an exception from the MIPS composite performance score and its corresponding adjustment to Medicare Physician Fee Schedule payments in favor of a 5% bonus on such payments.

In two circumstances, however, a practitioner’s participation in CPC+ does not qualify as participation in an Advanced APM:

  • A practitioner who is part of an ACO that participates in the Medicare Shared Savings Program (including an ACO in Track 1 of that program) still will be subject to MIPS.
  • Beginning in 2018, a CPC+ practitioner whose practice is operated through an organization with more than 50 MIPS-Eligible Clinicians (physicians and non-physician practitioners) will not be considered part of an Advanced APM.

Even if these circumstances do not apply, a CPC+ practitioner will avoid MIPS only if a specified percentage of the Part B patients for whom the practitioner furnishes services are in fact attributed to the practitioner’s practice.  The required percentage goes up each year:

  • Volume:  20% of all Part B patients are CPC+ attributed beneficiaries in 2017 and 2018; 35% in 2019 and 2020; 50% thereafter
  • Value:  25% of all Part B billing is for services furnished to CPC+ attributed beneficiaries in 2017 and 2018; 50% in 2019 and 2020; 75% thereafter

As a result, it becomes more difficult over time for a CPC+ practitioner to benefit from participating in an Advanced APM for purposes of MIPS.

Other Payers.  One key feature of CPC+, as compared to other Medicare programs, is multi-payer participation.  In all 14 regions, at least one commercial payer has agreed to make available similar payments to participating practices.  However, a practice’s acceptance into CPC+ does not automatically qualify that practice for these commercial payer programs; a practice will have to sign separate agreements with these payers.  Nor are these programs unique to CPC+ practices; a payer may elect to make its program available to other providers.

CMMI will not provide any detail regarding any commercial payer program, as it considers this information confidential.  Thus, a practice must communicate directly with the payer(s) regarding requirements and rewards of that payer’s program.

So Now What?  CPC+ is not without its downsides, especially given the monitoring and reporting requirements.  Also, CMMI has been less-than-transparent regarding the repayment of the performance-based incentive payment.  If, however, one believes primary care practices will need to transform their operations to succeed in the future, CPC+ offers a reasonably well-funded and well-structured opportunity to support these efforts meriting serious consideration.

While a practice may generate more FFS revenue through a formal ambulatory care management program (billing for those services for which CPC+ practices cannot bill), launching such a program requires a significant upfront investment and ongoing self-discipline.  Many CPC Classic participants credit the program’s structure and accountability as driving forces in their practice transformation efforts.

PYA consultants can assist your organization in evaluating the pros and cons of CPC+ based on your unique circumstances, including specific financial modeling.  Also, our experienced team can help your clinicians understand the program’s impact on their daily work.  And, finally, we can support the completion of the CPC+ application to ensure compliance with all requirements.  For more information, please contact Martie Ross or Aaron Elias.

Ambulatory Care Management Programs: New Revenue Opportunity for Specialists

Ambulatory care management programs generally are viewed as services offered by primary care providers.  However, specialists – oncologists, urologists, rheumatologists, cardiologists, pulmonologists, to name a few – caring for patients with chronic conditions should evaluate this opportunity.

By providing patient education, performing medication reconciliation, and arranging for support services, clinical staff bring care outside the four walls of the clinic or hospital and into patients’ daily lives.  Not surprisingly, research shows formal care management programs – with dedicated clinical staff regularly interacting with patients to manage their established care plans – improve patient outcomes and lower total costs of care.

Absent some source of funding to support the establishment and maintenance of an ambulatory care management program, however, there has been little financial incentive for specialists to pursue these programs.  Now, with new opportunities for Medicare reimbursement, as well as the upcoming Merit-Based Incentive Payment System (MIPS), specialists should take a new look at ambulatory care management programs.

Continue Reading

2017 Medicare Physician Fee Schedule Proposed Rule: Expanded Payments for Care Management Services

Since 2013, the Centers for Medicare & Medicaid Services (CMS) has been expanding Medicare payments for care management services.  This trend continues in the 2017 Medicare Physician Fee Schedule Proposed Rule.  Specifically, CMS proposes the following:

  1. Simplify the chronic care management (CCM) billing rules.
  2. Pay for complex CCM.
  3. Pay for care plan development.
  4. Pay for non-face-to-face prolonged evaluation & management (E/M) services.
  5. Change the supervision requirements for CCM furnished by rural health clinics (RHCs) and federally qualified health centers (FQHCs).

Additionally, CMS now recognizes the additional work involved in providing care management for patients with behavioral health conditions, proposing a new set of codes for these services.

Despite CMS’ prior efforts, CCM services have been woefully underutilized.  In 2015, only 275,000 Medicare beneficiaries received these services, just a small fraction of those who are eligible.

Now, with the proposed easing of the CCM billing rules and expanded payment for related care management services, physicians should reconsider incorporating a formal ambulatory care management program into their practices.

  1. CCM Simplification

According to a national provider survey, regulatory complexity has been the primary obstacle to CCM adoption.  In response, CMS proposes several revisions to the billing rules, all of which make it easier to provide these services.  (For a complete explanation of the current rules, please refer to PYA’s white paper, Providing and Billing Medicare for Chronic Care Management.)

  • No required consent form. Current rule:  A physician cannot bill for CCM unless and until the physician secures the beneficiary’s signature on a consent form, the contents of which are specified in the regulation.  Proposed rule:  A physician may simply document in the medical record that certain information regarding CCM was furnished to the patient.
  • Initiating visit. Current Rule:  CCM must be initiated by the billing physician during a face-to-face E/M visit (Levels 2-5 E/M visit, an annual wellness visit, or initial “Welcome to Medicare” visit).  Proposed Rule:  Such initiating visit is required only for new patients and patients not seen within the last twelve months.
  • 24/7 access to care. Current Rule:  The physician must provide the beneficiary with a means to make timely contact with healthcare practitioners in the practice who have access to the beneficiary’s electronic care plan.  Proposed Rule:  The requirement regarding access to the beneficiary’s care plan is eliminated.
  • Management of care transitions. Current Rule:  The physician must create and exchange with other providers involved in the beneficiary’s care a clinical summary formatted according to certified EHR technology.  Proposed Rule:  The continuity of care document does not have to be formatted in a specific manner.
  • Sharing of care plan and clinical summaries. Current Rule:  The physician must make the electronic care plan available (a) on a 24/7 basis to all practitioners within the practice whose time counts toward the time requirement, and (b) share care plan information electronically  (by fax only in extenuating circumstances) as appropriate with other providers.  Proposed Rule:  The electronic care plan must be made available timely within and outside the billing practice as appropriate, and care plan information must be shared electronically (can include fax) within and outside the practice with those involved in the beneficiary’s care.
  • Beneficiary receipt of care plan. Current Rule:  The beneficiary must be provided with a written or electronic copy of the care plan.  Proposed Rule:  The specification of the format in which the care plan is to be provided is eliminated.
  • Documentation. Current Rule:  A physician must document (in a qualifying certified electronic health record) communication to and from home- and community-based providers regarding the patient’s psychosocial needs and functional deficits.  Proposed Rule:  Such communications must be documented in the patient’s medical record, but not necessarily a qualifying certified electronic health record.
  1. Complex CCM

CMS proposes to make payment for complex CCM, CPT 99487.  The billing rules for CCM (CPT 99490) and complex CCM are the same, except complex CCM requires 60 minutes of non-face-to-face care management services per month, as compared to 20 minutes for CCM.  CMS also proposes an add-on code for complex CCM, CPT 99489, for each 30-minute increment that goes beyond the initial 60 minutes.

Here are the projected national payment rates for these three codes.  Note the 3.7% increase in the CCM payment rate for 2017:


  1. Care Plan Development

Acknowledging complaints that the time spent developing the CCM-required care plan currently is not reimbursed, CMS proposes to pay physicians for care plan development under a new code, GPPP7.  The agency proposes the following description for this code:

Comprehensive assessment of and care planning by the physician or other qualified health care professional for patients requiring chronic care management services, including assessment during the provision of  a face-to-face service.

This add-on code is to be listed separately in addition to the primary service and billed separately from monthly care management services.  The projected payment rate for GPPP7 is $63.68 (non-facility) and $46.15 (facility).

  1. Non-Face-to-Face Prolonged E/M Services

CCM and Complex CCM reimburse providers for clinical staff time spent providing care management services, not time spent by physicians.  Recognizing the additional resource costs involved in spending an extraordinary amount of time outside the office visit caring for an individual patient’s needs, CMS proposes to make payment under two codes:

CPT 99358 – Prolonged E/M service before and/or after direct patient care, first hour

CPT 99359 – Prolonged E/M service before and/or after direct patient care, each additional 30 minutes (listed separately in addition to CPT 99358)

In discussing these services, CMS warns the time counted for these codes must be beyond the usual service time for the primary or companion E/M code that is also billed; no time can be counted more than once toward the provision of CPT 99358, 99359, and any other service reimbursable under the Medicare Physician Fee Schedule.  The projected payment rate for 99358 is $113.41 (facility and non-facility); for 99359, it is $54.38 (facility and non-facility).

  1. CCM Supervision for RHCs and FQHCs

For CCM services billed under the Medicare Physician Fee Schedule, the clinical staff providing the non-face-to-face care management services must be under the general supervision of a physician or non-physician practitioner.  Thus, the clinical staff member does not have to be physically present in the same suite of offices when providing this service.

Currently, however, clinical staff providing these services for RCH and FQHC patients are subject to direct supervision, i.e., they must be physically present in the same suite of offices as a physician or non-physician practitioner who is available to provide assistance.

CMS now proposes to amend the regulations concerning RHCs and FQHCs, changing the direct supervision requirement to a general supervision requirement.  This change will afford these rural and safety net providers greater flexibility in providing CCM services for their eligible patients.

Behavioral Health Integration

Broadly speaking, the term “behavioral health integration” (BHI) refers to discussions, information sharing, and planning between a primary care provider and a behavioral health specialist relating to the treatment and management of a patient with behavioral health conditions.  One BHI model, the psychiatric Collaborative Care Model (CoCM), has been proven to improve patient outcomes.

CMS proposes to make separate payment for services using the CoCM beginning January 1, 2017, using three new G-codes, GPPP1, GPPP2, and GPPP3.  These codes describe the requirements for initial and subsequent collaborative care management involving a behavioral healthcare manager working in consultation with a psychiatric consultant under the direction of the patient’s treating physician.

Additionally, CMS proposes a new code for care management services for behavioral health conditions.  With the exception of the qualifying diagnosis, the billing requirements for GPPPX are the same as those for chronic care management.  The proposed reimbursement for this code is approximately $3.00 more than the reimbursement for 99490.  The differential is meant to cover the additional resources required to care for patients with behavioral health conditions.


Next Steps

Taken together, these proposed enhancements to Medicare reimbursement for ambulatory care management should give physician groups more reason to consider providing these services.  In addition to generating immediate revenue, care management services engage patients, improve outcomes, and reduce overall total cost of care.  Thus, a care management program can serve as a bridge between today’s fee-for-service reimbursement and emerging value-based alternative payment models.

This opportunity is not limited to primary care physicians.  Specialists who provide care for patients with chronic conditions can customize care management programs to meet patients’ specific needs.  For example, an oncology practice can fund chemotherapy patient navigator services through care management revenue.  Again, these services improve patient satisfaction and care coordination, thus improving quality and efficiency.

With a greater percentage of reimbursement tied to value each year, developing and deploying a care management infrastructure today will improve value-based performance in the near future.  Modest investments in necessary clinical staff and technology – either directly or through third-party contracts – are a wise move in a changing healthcare environment.

Medicare’s Proposed Episode Payment Model: 6 Things to Know Now as You Prepare for Later

time-to-planOn August 2, the Centers for Medicare & Medicaid Services (CMS) published a 248-page proposed rule detailing a new mandatory bundled payment program for heart attacks and bypass surgery.

Like CMS’ current mandatory bundled payment program, Comprehensive Care for Joint Replacement (CJR), the proposed Episode Payment Model (EPM) will make hospitals in select cities responsible for the total cost of care over a 90-day period for certain traditional Medicare beneficiaries.

While CJR targets beneficiaries who have hip or knee replacement surgery, EPM involves beneficiaries who have coronary artery bypass graft surgery (CABG) or who suffer an acute myocardial infarction (heart attack).

Here’s the who, what, how, when, and why for EPM:

  1. Who? CMS will randomly select 98 of 292 eligible metropolitan statistical areas (MSAs) to participate in EPM; the agency deemed 90 of the 382 MSAs identified by the U.S. Office of Management and Budget ineligible.  All hospitals in the selected MSAs will be subject to EPM, with the exception of those located in rural counties.  CMS has not stated when it will announce the 98 counties.
  2. What? An EPM hospital will be responsible for the total cost of care for CABG and heart attack patients from the time of their admission until 90 days following discharge.   “Total cost of care” includes all Part A and Part B payments for services provided during the episode of care, with the exception of specified unrelated services.

    A hospital’s responsibility will take the form of liability for the difference between the actual total cost of care and a target price.  This responsibility comes with a reward:  if the actual total cost of care is lower than the target price, CMS will pay the difference to the hospital.

  3. How? CMS will determine the target price based on historical hospital-specific and regional data.  For Years 1 and 2, that blend will be two-thirds hospital-specific and one-third regional data; in Year 3, it switches to one-third hospital-specific and two-thirds regional data.  In Years 4 and 5, the target price will be based solely on regional data.

    To calculate a hospital’s target price per episode, CMS will apply a discount to the historical costs.  For hospitals with higher overall quality scores, a lower discount rate will be applied, and thus the target price will be higher.  CMS also will adjust target prices based on the relative complexity of the hospital’s episodes of care.  

  1. When? CMS proposes to commence EPM on July 1, 2017, and continue the program through December 31, 2021.

    As with CJR, CMS proposes a phased-in approach.  With respect to downside risk, CMS outlines the following schedule:

  • July 2017 – March 2018:  No repayment
  • April 2018 – December 2018: Capped at 5%
  • 2019: Capped at 10%
  • 2020 – 2021: Capped at 20%

    CMS proposes to phase in rewards as well:

  • July 2017 – December 2018: Capped at 5%
  • 2019: capped at 10%
  • 2020 – 2021 Capped at 20%

CMS will accept comments on the proposed rule through October 3.  Expect the final rule to be published in late 2017 or early 2018.

  1. Why? According to CMS, EPM is intended to incentivize cooperation and collaboration between hospitals, physicians, and other providers.  As with CJR, there is little a hospital can do on its own to reduce total costs of care; it will always receive the same DRG payment.

    With CJR, most of the opportunity lies with post-acute care, i.e., whether a post-surgical patient goes to an inpatient rehabilitation hospital, a skilled nursing facility, or his or her home with supportive services.  Working with its orthopaedic surgeons, a hospital can establish processes to ensure each patient continues recovery in the most appropriate environment.

    The same is somewhat true for CABG:  a hospital will need to work with its cardiovascular surgeons to ensure patients are managed appropriately post-discharge.  With respect to heart attacks, however, a hospital will need to involve a much larger group of physicians, including primary care physicians and cardiologists with established patient relationships.

    For both CABG and heart attack patients, there are many more variables in play than the site of service for post-acute care.  Variables include medication management, nutrition counseling, exercise regimes, and follow-up appointments.  Thus, hospitals will need to work with these patients’ physicians to design and implement effective transitional care management programs.

    To facilitate these hospital-physician relationships, CMS again has authorized gainsharing arrangements as a means to bring physicians to the table.  These arrangements permit hospitals to share with other providers the amount received by the hospital for beating the target price as well as the hospital’s internal cost savings realized  through care re-design and improvement.

  1. What else? In addition to EPM, the August 2 proposed rule also expands CJR’s scope to include hip and femur fracture surgeries.  CMS, however, does not propose to expand CJR participation; these new “bundles of joy” will apply only to current CJR hospitals.

    CMS also is proposing new incentive payments to encourage the use of cardiac rehabilitation services with CABG and heart attack patients:  $25 per service for the first 11 services and $175 per service thereafter.  The total number of services would be capped per Medicare coverage policy.

    Hospitals may use this incentive payment to coordinate cardiac rehabilitation and support beneficiary adherence to the cardiac rehabilitation treatment plan to improve cardiovascular fitness. Hospitals in 90 to-be-selected MSAs will be eligible for these payments:  45 EPM MSAs and 45 non-EPM MSAs.

Now is the time to start analyzing the details of the EPM program.  Hospital leaders should become educated regarding program requirements. These leaders, in turn, should invite potential EPM collaborators into conversations regarding the program, and begin to build the trust and relationships that will be the key to success.

PYA has extensive experience supporting providers participating in CJR and CJR’s older sibling, BPCI, both with technical compliance and development and implementation of care redesign plans.  PYA can partner with your organization to develop and implement a successful EPM strategy.

  • PYA offers interactive educational opportunities for leadership teams to understand the details of the EPM program and its impact on the organization.
  • PYA’s performance improvement experts can identify and support implementation of strategies to improve key quality scores and reduce costs.
  • PYA can assist hospitals with developing and implementing processes to ensure full compliance with EPM regulatory requirements.
  • PYA Analytics’ computational scientists have deep and wide experience extracting knowledge from CMS claims data, including opportunities for greater efficiency and cost savings.
  • Drawing on its extensive experience in the development and operation of clinically integrated networks and clinical co-management and gainsharing arrangements, PYA can facilitate communications between a hospital and potential EPM collaboratives, and support development of mutual strategies for success.
  • PYA provides financial modeling to help an organization understand and respond to the potential financial impact of EPM.

MACRA Delay? Don’t Count On It

magic-eight-ball-dont-count-on-it-photo-researchers-incYou may have seen a headline or two last week stating that the Centers for Medicare & Medicaid Services (CMS) may delay MACRA’s effective date.  However, the agency has not announced any such delay.  Instead, CMS’ top official indicated the agency is considering some adjustments to the initial performance period.

The U.S. Senate Finance Committee held a hearing on MACRA last week, and CMS Acting Administrator Andy Slavitt was called upon to testify.  In his prepared remarks, Slavitt highlighted CMS’ outreach activities, beginning last year, intended to inform the rulemaking process, but never used the word “delay.”   Instead, during questioning, Senator Orrin Hatch (R-Utah), the committee chair, noted that many physician groups have been calling for a six-month delay, and stated that the statute gives CMS the flexibility to move the start date for the reporting period back.  In response, Slavitt acknowledged that CMS had received significant feedback on this point, and that the agency remained open to the option of an alternative start date and shorter performance period.

In the proposed rule, CMS has stated the initial performance period will be January 1, 2017, to December 31, 2017.  Physicians then will report on their 2017 performance on the MACRA measures during the first part of 2018.  CMS will announce individual physician composite performance scores in late 2018.  Then, starting January 1, 2019, physicians’ Medicare payments will be adjusted based on those composite performance scores.

The potential delay discussed during the committee hearing last week would mean a shortening of the initial performance period.  Instead of measuring performance for the entirety of 2017, CMS may elect to measure only the last six months, for example.  That would afford physicians extra time to identify relevant measures, focus on performance improvement, and figure out reporting mechanisms.  But it would not delay the release of the first round of composite performance scores or the start of payment adjustments January 1, 2019.

In light of this, providers should continue preparing for MACRA, rather than merely hoping it will go away.  Right now, the focus should be on education—helping physicians understand how MACRA works and the impact on their practices—and strategies for maximizing their composite performance scores.

2017 OPPS Proposed Rule: 4 Things to Know and 4 Things to Think About Regarding Site-Neutral Payments


The recently published 2017 Outpatient Prospective Payment System (OPPS) Proposed Rule provides additional information regarding the site-neutral payment provisions included in Section 603 of the Bipartisan Budget Act of 2015. The Proposed Rule explains certain aspects of the provisions that will prohibit newly established off-campus hospital outpatient departments (HOPDs) from billing services and receiving payments under OPPS. Listed below is a summary of items “to know” regarding the Proposed Rule, along with items “to think about” when considering the impact on your organization.

To Know…

  • Provider-based outpatient departments (excluding ERs) that are located off-campus and have not billed as such prior to November 2, 2015, will be precluded from billing under the OPPS payment system effective January 1, 2017.
  • On-campus facilities, as currently defined under 42 CFR §413.65, are excluded from the site-neutral payment provisions. These include facilities located in physical areas immediately adjacent to the hospital’s main buildings or other areas that are not strictly contiguous but within 250 yards of the main buildings.
  • Considerations for established off-campus HOPDs that began billing prior to November 2, 2015, include:
    • Established off-campus HOPDs should be reported on the hospital’s CMS 855A Medicare Enrollment Form. This form may be used in the future to confirm HOPD billing status.
    • Claims for services provided by established off-campus HOPDs require a modifier during calendar year 2016. The billed modifier also may be used by CMS to confirm HOPD status.
    • Established off-campus HOPDs will lose the potential payment benefit under OPPS if relocated to another physical address. Exceptions to this provision are being considered and will be addressed in the Final Rule.
    • Established HOPDs that provide new services after November 2, 2015, outside the current clinical service family, will be precluded from billing the new services under the OPPS payment system.
    • Should ownership of established off-campus HOPDs change, the payment benefit under OPPS will not be extended to new owners unless the main hospital is also acquired and the Medicare provider agreement is accepted.
  • For CY2017 only, off-campus HOPD services not meeting the exception criteria will be paid under the physician fee schedule with the physicians billing the claims, unless reassigned.

To Think About…

  • Hospitals with existing HOPDs should take stock of the services currently being billed under the OPPS payment system and ensure off-campus facilities are included on their CMS 855A Medicare Enrollment Form. Although an established off-campus provider-based facility may be excluded from the proposed payment provisions, future changes to a facility’s location or services will impact the facility’s billings and payments under OPPS.
  • Hospitals should review facilities currently billed as provider-based that are close in proximity to the hospital’s main campus, and also review any previously filed provider-based attestations regarding such sites. Facilities located on-campus are excluded from the site-neutral payment provisions, regardless of operational or physical changes.
  • No changes have been proposed to date regarding the Medicare cost report form, but may be forthcoming in the Final Rule. Future cost report revisions should be monitored closely for implications to other programs and services, such as Medicaid, 340B, Medicare bad debt, etc.
  • The Proposed Rule states specific challenges regarding implementation of the OPPS payment provisions. Services provided by off-campus HOPDs during CY2017 that do not meet the exception criteria will be billed and paid along with the practitioner’s services under the Medicare physician fee schedule non-facility rates.  This payment methodology may prove problematic for HOPDs serviced by independent healthcare professionals.  Public comments have been requested for consideration in developing a new billing and payment policy for periods after CY2017.  Given these stated concerns regarding implementation, modifications to the proposed provisions are expected in the Final Rule.

Comments regarding the 2017 OPPS Proposed Rule are due to CMS on or before September 6, 2016.

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