®

Doctors need to act now — or risk losing ground

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MIPS: HOW PHYSICIANS

CAN WIN IN THE

NEW HEALTHCARE

ENVIRONMENT

Continuum Health Alliance, LLC402 Lippincott DriveMarlton, NJ 08053856.782.3300www.continuumhealth.net

CHANGES TO MEDICARE WILL SOON HAVE A MAJOR IMPACT ON PHYSICIANS’ BOTTOM

LINES. THE CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) IS FAST-TRACKING ITS

SHIFT TO VALUE-BASED PAYMENTS, WITH THE INTRODUCTION OF NEW REGULATIONS,

REPORTING REQUIREMENTS AND FINANCIAL CONSEQUENCES.

As a result, physicians could experience a substantial difference in their Medicare

Part B payments. Whether that change is positive or negative, though, depends

upon their preparedness.

For most private-practice physicians, the situation demands immediate attention.

That’s because each year’s reported data will affect payments two years later.

Moreover, Medicare is switching from an incentive-based system to one with

mounting penalties. Independent practices are especially vulnerable due to the

complexity of these changes. Even solo practitioners will be affected.

THE GOOD NEWS: Doctors can take incremental steps to address these changes.

But it’s vital to move forward now.

The United States will spend

nearly 20% of its gross

domestic product (GDP) on

healthcare by 2026, according

to an analysis from CMS1

Healthcare Costs as a Percentage

of GDP 2026

THE SOONER YOU ACT, THE BETTER YOU’LL PROTECT YOUR PRACTICE AND YOUR LIVELIHOOD.

Regardless of size,

it’s generally more

cost-efficient for private

practices to outsource

the management of this

multi-faceted transition.

Employer & Employee

Insurance Cost Increase

Employee and employer insurance

costs continue to rise with a 5.5%

increase expected in 20185

America ranks first in healthcare spending—

at $3 trillion annually3—but life expectancy

places 43rd worldwide4

2017

Healthcare Spendingin U.S. is

#1

U.S. Life Expectancy

Ranking:

#43

2018

C O N T I N U U M H E A LT H | 2

$ of today’s

healthcare

spending

A N E S T I M A T E D

i s W A S T E F U L

$2

20%

HOW did we get here?

The government and other stakeholders have realized that healthcare spending is on

an unsustainable path. Costs continue to rise significantly (though at a slower pace),

quality often lags, and excessive waste persists.

To solve this growing crisis, the federal government is leading a shift from “volume”

to “value.” It’s changing the old system that rewarded quantity of care to one that

centers on quality of care. The Medicare Access & CHIP Reauthorization Act

(MACRA) of 2015 provides the overarching framework for this transition.

Commercial payers are adopting similar models.

In fact, the transformation started approximately ten years ago with the introduction

of the Physician Quality Reporting System (PQRS), followed by Meaningful Use (MU)

incentives.

In 2010, the Affordable Care Act established the Value-Based Payment Modifier

(VBM or VM)—an adjustment to physician fee schedules that ties payment to

quality. CMS began phase-in of the VBM in 2015, based on 2013 reporting.

In 2017, CMS launched the Merit-Based Incentive Payment System (MIPS), a more

complex program that incorporates the VBM and other value measures.

While change is never easy, doctors must adapt in order to survive. Like it or

not, this new reality is here to stay: it has strong bipartisan support, the industry is

already heavily invested, and the technology now exists to enable it.

Moreover, greater transparency is coming for both price and quality—as increased

data collection, market competition and consumer demand converge.

“THERE IS NO TURNING BACK TO AN UNSUSTAINABLE SYSTEM

THAT PAYS FOR PROCEDURES RATHER THAN VALUE... THE ONLY

OPTION IS TO CHARGE FORWARD — FOR HHS TO TAKE BOLDER

ACTION AND FOR PROVIDERS AND PAYERS TO JOIN WITH US.”

— Alex Azar, Health and Human Services Secretary,

speaking at a March 2018 hospital convention

Medicare’s QualityGoals: + +

BETTER CARE SMARTER SPENDING HEALTHIER PEOPLE6

$

C O N T I N U U M H E A LT H | 3

TODAY’S IMPERATIVES: FOR PHYSICIANS, IT’S SINK-OR-SWIM TIME. THE

WATERS OF THIS PARADIGM SHIFT CONTINUE TO RISE EACH YEAR. VIRTUALLY ALL DOCTORS

WILL BE AFFECTED BY THESE CHANGES, WHICH INCLUDE SUBSTANTIAL PENALTIES FOR THOSE

WHO UNDERPERFORM ON QUALITY AND COST MEASURES IN COMPARISON TO THEIR PEERS.

On the plus side, physicians who perform well under the new rules will receive

additional reimbursement from Medicare. And commercial payers are starting to

create similar opportunities.

If you’re just starting to address these changes, prioritize the Merit-Based Incentive

Payment System (MIPS). But first, it’s helpful to understand MIPS’s predecessor—

the Value-Based Payment Modifier (VBM)—which has been wrapped into MIPS.

VBM had its final reporting period in 2016, and 2018 is its final payment year.

Reporting has now shifted to the more complex, higher-stakes MIPS.

PQRS

The Physician Quality

Reporting System

requires physicians

and other eligible

professionals (EPs) to

report quality data in

order to avoid Medicare

payment penalties. This

program is replaced by

MIPS reporting in 2018.

VBM

The Value-Based Payment Modifier applied additional payment incentives and penalties based on a com-bination of PQRS perfor-mance data and Medicare cost data. VBM could also consider claims-based outcomes measures and patient surveys (CAHPS —Consumer Assessment of Health Providers and Systems). VBM reporting ended in 2016, but its mea-sures are now part of MIPS.

MU/ACI

Meaningful Use (MU)

is providers’ use of

certified electronic

health record (EHR)

technology in ways

that measurably

improve quality and

value. This has been

replaced by Advanc-

ing Care Information

(ACI) measures.

CMS evaluates practices

as a group if they share

a single tax ID number.

Therefore, all practice

members must perform

strongly to ensure the

group’s success.

VBM: A Quick ReviewCMS began using the VBM in the 2015 payment year,

starting with groups of 100-plus eligible profession-

als (EPs), and expanding to smaller practices and solo

practitioners by 2017. The amount of potential payment

adjustments was linked to the size of the group: larger

practices could have greater swings than smaller

practices. As with MIPS, the adjustments are required to

be budget-neutral; in other words, the national totals for

penalties and incentives must cancel each other out. For

the 2016 reporting year (2018 payment year), payment

adjustments will range from -2% to +6.6%.7

C O N T I N U U M H E A LT H | 4

MIPS: Getting Started

The Merit-Based Incentive Payment System (MIPS) is a new algorithm that

encompasses the previous models—MU,* PQRS and VBM—and adds “Clinical

Practice Improvement” activities. Created under MACRA, MIPS replaces Medicare’s

troubled physician reimbursement model, known as the Sustainable Growth Rate

(SGR) formula. (*MU has been replaced by Advancing Care Information (ACI),

which includes measures related to patient engagement, patient electronic

access, and use of certified electronic health record technology.)

This table shows the four components of MIPS and their relative weights:

COMPONENTS OF MIPS (MIPS score: 0 – 100 points)

“TECHNOLOGY IS UNLEASHING LOTS OF WAYS TO

MAKE CARE ACCESSIBLE, MORE PATIENT-CENTERED,

MORE EFFICIENT AND LESS COSTLY.”

— Margaret O’Kane, President, National

Committee For Quality Assurance (NCQA)

Key Terms ACI: advancing care information

ACO: accountable care organization

APM: alternative payment model

CHIP: Children’s Health Insurance Program

CIN: clinically integrated network

CMS: Centers for Medicare &

Medicaid Services

EP: eligible professional

MACRA: Medicare Access &

CHIP Reauthorization Act

ACI (successor to MU)

25%

VBM Cost 10% in 2018

30% in 2019

Clinical PracticeImprovement

15%

PQRS/VBM Quality

50%

25%

30%

10% 15%

50%

MIPS: Merit-Based Incentive Payment System

MU: meaningful use

NCQA: National Committee for Quality Assurance

PQRS: Physician Quality Reporting System

VBM: Value-Based Payment Modifier (a.k.a. VM)

C O N T I N U U M H E A LT H | 5

MIPS reporting started in 2017, WITH PAYMENT EFFECTS FIRST

HITTING IN 2019. THE IMPACT CAN BE EXPONENTIAL: IN MIPS’S FIRST YEAR, ADJUSTMENTS

TO A PRACTICE’S MEDICARE PAYMENTS CAN RANGE FROM -4% TO ABOUT +19%. BY 2020,

THOSE FIGURES COULD SPAN FROM -9% TO +27% OR MORE. (THE SCALING FACTOR “X,”

SHOWN IN THE TABLE BELOW, IS CAPPED AT 3.0. THEREFORE, THE MAXIMUM BASE INCENTIVE

FOR THE 2020 PERFORMANCE YEAR COULD, IN THEORY, BE +9% * 3.0 = 27%.)

Exemptions and AdditionsIf you do little Medicare billing, you may be exempt from MIPS. CMS has expanded

the low-volume threshold to exclude providers with less than $90,000 in Medicare

Part B charges or less than 200 Part B beneficiaries annually.

PerformanceYear

2017

2019

2018

2020

2019

2021

2020

2022

-4%

-7%

-5%

-9%

+4%X

(CMS predicts X = 0.86)

+7%X

+9%X

+5%X

(CMS predicts X = 0.30)

+10%Y

(CMS predicts Y = 1.52)

+10%Y

+10%Y

+10%Y

(CMS predicts Y = 1.75)

PaymentYear

Max.Penalty

MaximumBase Incentive*

Max. ExceptionalPerformance

Bonus**

MIPS Maximum Payment Adjustments8

However, small practices—those with 1 to 10 physicians—can band together vir-

tually (regardless of their geographic locations or clinical specialties) to report

on MIPS measures. As a group, they are assessed and scored collectively.

In addition, non-physician EPs will be subject to the VBM component of MIPS

starting in 2018. These include physician assistants, nurse practitioners, clinical

nurse specialists, certified registered nurse anesthetists and anesthesiologist

assistants.

MIPS can have an enormous effect on a practice—growing or shrinking its

Medicare reimbursements substantially.

* A scaling factor (X) may be applied to maintain MIPS’s budget neutrality.

** Top performers also qualify for an “exceptional performance bonus” on top of their base incentive. A scaling

factor (Y) may be used.

C O N T I N U U M H E A LT H | 6

TIPS for succeeding under MIPS

With MIPS under way, there’s no time to waste. Physicians must dedicate

themselves to being “quality champions” and make sure they have the data to

prove it, in order to receive rewards and avoid penalties under MIPS. Doctors

need to score high on quality measures while keeping the overall cost of care low.

If you’ve participated in VBM, you have a head start. Understanding how you’re

measured under VBM will help you address MIPS requirements.

THE FOLLOWING STRATEGIES CAN HELP YOU ACHIEVE THESE GOALS:

n Focus on patient attribution. CMS attributes each patient annually to a physician

based on the majority of primary care utilization. Yet, if your patient sees other

doctors, the quality and cost of that care—good or bad—will be attributed to

you. Make sure to communicate with these other physicians to improve care

coordination and avoid duplicate services.

n Improve patient access. Ensuring your patients receive the right care in the right

place at the right time is critical to keeping costs down. Provide a way for patients

to reach your practice 24/7—by phone, online portal or mobile app, for instance—

to help avoid unnecessary emergency-room visits and other inefficiencies. Reach

out to complex patients to proactively manage their care.

n Enhance MIPS participation. All non-exempt physicians must report MIPS

data or face Medicare penalties. However, each practice chooses which quality

measures to report on (within certain parameters)—and can emphasize

measures that reflect the highest levels of quality. For example, if 98% of your

diabetic patients had their annual foot exam this year, you’ll want to report on

that measure. To best make such determinations, physicians must have an

electronic health record (EHR) and use it meaningfully. In essence, the EHR must

be able to capture the appropriate data and report it back. For that to happen,

the EHR must contain the right fields, and doctors must be trained to enter the

data properly.

The “Clinical Practice Improvement” component of MIPS offers

more than 100 options to choose from, including such activities as:

• Being an NCQA-designated patient-centered medical home

• Providing expanded practice access, such as same-day

appointments

• Conducting population health management activities

• Providing care coordination, including patient

engagement activity

• Providing self-management training to patients

C O N T I N U U M H E A LT H | 7

n Track performance. Practices can assess quality in several ways. Your EHR should

be able to run reports on quality. You can also obtain Quality and Resource Use

Reports (QRUR) from CMS; these provide feedback on quality, which can help

you estimate how you will fare under MIPS and where you need to improve. A

well-qualified enablement partner can provide additional tools, analysis and

advice to monitor and improve quality.

n Reduce overall costs. Although costs cannot be tracked because this data is

not available across providers, practices can help minimize costs of care. Key

strategies include providing enhanced patient access (as previously noted),

engaging patients in their own care, enhancing work flows to increase efficiency,

making referrals to like-minded (value-driven) physicians, and becoming clinically

integrated—such as by joining a clinically integrated network (CIN) or

accountable care organization (ACO). CINs are described in more detail later.

n Button down your data. CMS requires practices to provide data, and they may

audit your practice. Determine how you will document quality. Make sure you

can prove the information you report.

n Stay informed. MIPS quality measures will be updated annually, and the

program’s requirements are subject to change.

Unique Insight Into Costs Unlike other enablement

partners, Continuum has access to physician cost data

through its collaboration with CMS and commercial

payers. This data allows Continuum to provide physi-

cians with high-quality, lower-cost provider options.

MIPS requires investments of time and resources.

The right enablement partner can do the heavy

lifting—freeing doctors to be

doctors, and ensuring the

practice’s continued success.

®

C O N T I N U U M H E A LT H | 8

New MIPS Challenges & Improvements

CMS will continue to revise and update MIPS. For instance, providers must now

report a full year of data, and the completeness requirements have increased.

CMS also plans to remove measures considered “topped out” or “too easy”

over a four-year period, and it has reduced the possible earned points for

these measures.

On the plus side, CMS has added 21 new Clinical Practice Improvement Activities

to choose from. And it’s considering new, “episode-based” cost measures for 2019,

which could present a new opportunity to providers.

For more on recent changes to MIPS, download our white paper titled Value-

Based Care in Uncertain Times: Navigating the Quality Payment Program.

Go to: https://www.continuumhealth.net/insights/white-papers/

An Alternative to MIPS

Beginning in 2019, physicians can avoid MIPS by participating in an advanced

alternative-payment model (advanced APM), such as certain ACOs, medical homes

or bundled payment models. Advanced APM participants could earn higher

payments in exchange for greater financial risk, compared to MIPS participants.

In fact, MACRA’s long-term objective is to shift more clinicians to Advanced APMs

and away from the MIPS program. In the meantime, MIPS participation can help

prepare practices for that step.

For more information on advanced APMs,

download our white paper titled “The

New Gold Standard in Quality Payments:

Alternative Payment Models.”

“WE’RE AT THIS MOMENT OF OPPORTUNITY TO REALLY LOOK

AT HOW WE DELIVER CARE AND HOW WE PAY PHYSICIANS.

WE’RE NOW TRYING TO START WITH A CLEAN SLATE AND

ENABLE A PAYMENT SYSTEM THAT SUPPORTS OUR GOALS …”

— Margaret O’Kane, President, NCQA

®

Should your practice reach for the gold?

®

APMs: The New Gold

Standard in

Quality Payments:

Alternative

Payment Models.

Continuum Health Alliance, LLC402 Lippincott DriveMarlton, NJ 08053856.782.3300fax 856.782.3526

C O N T I N U U M H E A LT H | 9

One leading solution is to form a clinically integrated

network (CIN), which enables physicians to join together

to improve quality, reduce overall costs, and earn more

revenue through MIPS. CINs can also facilitate larger

payments from commercial insurers, as more payers

follow CMS’s lead and adopt value-based reimbursement

programs. (Similarly, doctors can form an accountable care

organization [ACO]—a type of CIN specifically designed

for Medicare.)

An enablement partner can help design, set up and manage the CIN, providing the

necessary personnel support, technology and expertise for a successful network.

A Better Future

Medicare’s transition to value-based reimbursement will ultimately drive a higher

quality, more sustainable healthcare system. While the changes can be daunting,

physicians need to recognize these shifts and embrace them—for the benefit of their

patients, society and themselves. Doctors must understand how their performance

will be judged and apply this knowledge.

Physicians who adapt will also benefit from the greater levels of transparency

coming to the medical profession. In fact, if you see Medicare patients, some of

your quality data may already be online at medicare.gov/physiciancompare. Greater

access to such information will further reward quality and raise the bar for the entire

medical profession.

New Opportunities: AS STATED EARLIER, PRIVATE-PRACTICE PHYSICIANS

MUST ALIGN WITH OTHER PROVIDERS IN ORDER TO SURVIVE AND THRIVE IN THE NEW

HEALTHCARE ENVIRONMENT. HOWEVER, MANY ARE WONDERING HOW THEY CAN DO

THIS WHILE REMAINING INDEPENDENT.

THIS IS “A HISTORIC OPPORTUNITY TO FINALLY MOVE TO A

SYSTEM THAT PROMOTES QUALITY OVER QUANTITY AND

BEGINS THE IMPORTANT WORK OF ADDRESSING MEDICARE’S

STRUCTURAL ISSUES.”

— Congressman Fred Upton, Chairman,House Energy

and Commerce Committee

C O N T I N U U M H E A LT H | 1 0

IMPROVE QUALITY

REDUCE OVERALL COSTS

EARN MORE REVENUE

CLINICALLY INTEGRATED NETWORKS CAN:

ABOUT Continuum Health

As a physician enablement company, Continuum Health delivers managed

solutions to provider groups and aggregators, helping foster self-sufficiency

by maximizing fee-for-service payments, transitioning them to value-based

programs and preparing them for risk. Continuum also collaborates with payers

to help drive value-based adoption among providers and improve the health

outcomes of patients. The company optimizes performance through value-based

care, practice management services, revenue cycle management, and specialty

care solutions. Thousands of physicians, specialists and nurse practitioners caring

for millions of patients depend on Continuum’s business and clinical experts to

help achieve their goals. Learn more at www.continuumhealth.net.

Related white papers:

n Value-Based Care in Uncertain Times: Navigating the Quality Payment Program

n The New Gold Standard in Quality Payments: Alternative Payment Models

Go to: https://www.continuumhealth.net/insights/white-papers/

Disclaimer: CMS rules and regulations are subject to change over time.

Sources1 National Health Expenditure Projections, 2017–26: Despite Uncertainty, Fundamentals Primarily Drive Spending Growth Cuckler, Sisko, Poisal, et al.; Health Affairs 2018 37:3, 482-492

2 http://www.dartmouthatlas.org/downloads/press/Skinner_Fisher_ DA_05_10.pdf - page iii

https://khn.org/morning-breakout/iom-report/

3 https://www.cms.gov/research-statistics-data-and-systems/statistics-trends- and-reports/nationalhealthexpenddata/downloads/highlights.pdf

4 https://www.cia.gov/library/publications/the-world-factbook/rankorder/ 2102rank.html

5 https://www.shrm.org/ResourcesAndTools/hr-topics/benefits/Pages/ employers-benefits-costs-rise.aspx

6 Medicare’s Quality Goals (GRAPHIC): www.cms.gov/Medicare/Quality- Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/ MACRA-MIPS-and-APMs/Draft-CMS-Quality-Measure-Development- Plan-MDP.pdf - page 13

7 https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ PhysicianFeedbackProgram/2016-QRUR.html

8 https://www.saignite.com/industry-expertise/quality-payment-program/ mips-education/10-faqs-about-mips/

Continuum Health Alliance, LLC402 Lippincott DriveMarlton, NJ 08053856.782.3300www.continuumhealth.net

®