MACRA Made Simple

(The following includes excerpts from our upcoming course, Strategic Issues for Boards, as well as information that didn’t make the cut.)

 

MACRA creates two different tracks for clinicians to participate in Medicare. One is called the Merit-Based Incentive Payment System, or MIPS. The second is the Advanced Alternative Payment Model (AAPM). Each of these tracks has different incentives.

 

MIPS judges clinicians across four different categories: quality, cost, improvement activities and meaningful use, or what is now called the advancing care information category. A composite score is created, and clinicians will be compared to others within MIPS. Depending upon how well they perform, clinicians will receive an upward or downward adjustment to their payment.

 

Under the AAPM track, different delivery models such as Accountable Care Organizations (ACOs) or the bundled payment program, are intended to align incentives across a continuum to drive the triple aim of improving quality, reducing costs, while improving patients’ experience of care.

 

When the proposed rules for the Quality Payment Program (a part of MACRA) were released, CMS initially projected that smaller practices, those smaller than one hundred eligible clinicians, would see the brunt of the penalties associated with the program. In fact, CMS projected that:

 

  • 97 percent of solo practitioners will receive some type of downward payment adjustment
  • 90 percent of practices with 25 eligible clinicians or fewer will have a downward payment adjustment

 

As a result of these projections and feedback from stakeholders, CMS implemented a transitional year in 2017, affecting payment in 2019, where there are lower thresholds for participation.

 

Preparing for MACRA

 

Preparing for MACRA requires a thoughtful approach:

 

  • Do an assessment to understand how well you are positioned both under MIPS as well as the potential to move into an Advanced Alternative Payment Model.
  • Identify areas for performance improvement.
  • Develop a strategic plan that outlines how you will move forward with MACRA and also is tied to a broader strategy related to other payment changes and delivery system reforms that are coming, or that you perceive to be coming from the new administration.
  • The MACRA strategy could take several forms; e.g., staying in MIPS for a few years, and then moving towards an Advanced Alternative Payment Model track, or staying in MIPS over the long run.

 

The Board

 

The board should recognize that MACRA will have an impact on the organization’s long-term viability. It affects how the organization supports employee clinicians, but also how it engages with independent clinicians.

 

MACRA sets up a dynamic where there are incentives to align with your clinicians, to be able to help them, ahead of “disruptor” organizations coming into the market that could potentially set up an ACO with your clinicians. Your organization would then be a “cost center” of the disruptor-owned ACO.

 

MACRA will have a major impact on how you work with clinicians in the future, as well as how you continue to evolve with the new payment models. There is no new money coming into health care, and so working well with clinicians, moving towards population health models that will help you be successful under value-based reimbursement is going to be a key critical differentiator for your health system

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(Excerpt from Seth Edward’s interview for iProtean’s upcoming course, Strategic Issues for Boards.)

 

 

Check your library for the advanced Finance Course, Financial Risks & Strategic Implications of APMs, featuring Marian Jennings and Seth Edwards. In this course, Marian and Seth discuss the financial risks of ACOs and bundled payments, the strategic risks of not participating in an alternative payment model, clear trends and the characteristics of organizations that have successfully implemented one or more alternative payment models.

 

 

For a complete list of iProtean courses, click here. www.iprotean.com/index.php/iprotean/onlineCourses/Available_courses

 

 

For more information about iProtean, click here.

Elements for Defense Against Information Breaches

To protect against cyber attacks, an organization should have an enterprise risk management program that has three layers of defense: information security, internal audit and risk management. These layers complement one another.

 

  • The information security group has a large swath of IT related issues to cover.
  • The internal audit group will help the information security group find the gaps they may be missing.
  • The risk management group focuses on disaster recovery and cybersecurity related events that could happen within a disaster recovery event.

 

The “pillars” of defense within information risk include:

 

  • Governance: providing metrics, charters, three- and five-year plans
  • Application security team: testing applications for security holes
  • Engineering team: designing protections in monitoring equipment across the network
  • Security operation center: monitoring the security posture on a 24/7 basis
  • Compliance: determining your security hygiene

 

Some Key Vulnerabilities

 

Hospitals have several areas of vulnerability when it comes to information risk. Two areas noted here are medical records and patient safety.

 

Medical records

Cyber thieves want to gain access to medical records for a variety of reasons; for example, blackmailing patients who don’t want the personal information in their medical records made public. Also, the thieves can post the medical information on the Internet and put it up for sale, thus gaining financially.

 

Patient Safety

Data breaches can affect patient safety through medical devices that patients rely on for their care. In some instances, these devices did not take security into account when they were developed. Or, if you have a data breach within your facility, there is a good probability that the machines connected to that network could also be compromised. There would have to be malicious users who would look to do this, but they could take control of any number of machines and adversely affect a patient’s health; for example, having the injections go up or down, or affecting wireless pacemakers.

 

In fact, any device that you put on a network is going to be vulnerable to some sort of cyber attack. If you have your hospital devices on the same network as some computers that have Internet access, such as email or web surfing, you have a high degree of risk of having one of those devices compromised.

 

Devices running electrical grids typically were designed with security as an afterthought. If a cyber thief can hack into those devices, it could potentially elicit various types of conditions where an injection system may inject more or less medication than prescribed. Those devices could also be turned off completely.

 

These risks will always be out there as long as those medical devices are not isolated on their own networks; i.e., not connected to the Internet.

 

(Excerpt from Martin Liutermoza’s interview for iProtean’s upcoming course, Two Strategic Risks for Boards.)

 

Check your library for the advanced Finance Course, Financial Risks & Strategic Implications of APMs, featuring Marian Jennings and Seth Edwards. In this course, Marian and Seth discuss the financial risks of ACOs and bundled payments, the strategic risks of not participating in an alternative payment model, clear trends and the characteristics of organizations that have successfully implemented one or more alternative payment models.

 

 

For a complete list of iProtean courses, click here. www.iprotean.com/index.php/iprotean/onlineCourses/Available_courses

 

 

For more information about iProtean, click here. www.iprotean.com/index.php/iprotean/demo

Survey Shows Lack of Knowledge About MACRA

About half of hospital-based physicians said they were not knowledgeable about the Medicare physician pay overhaul (Medicare Access and CHIP Reauthorization Act of 2015—MACRA) that began earlier this year, according to a recent survey by KPMG and the American Medical Association. This represents a larger share compared with physicians in other settings.

 

The survey results showed the percentage of physicians who reported themselves “not knowledgeable” about MACRA and its Quality Payment Program (QPP):

  • Hospital-based Physicians: 49 percent
  • Solo Practice: 44 percent
  • Multi-Specialty Group Practice: 35 percent
  • Single-Specialty Group Practice: 41 percent

 

The survey respondents said they need education about:

  • The time required to accurately capture and report performance data: 66 percent
  • Understanding reporting requirements: 58 percent
  • Understanding overall MIPS scoring process: 57 percent
  • Cost required to accurately capture and report performance data: 53 percent
  • Organizational infrastructure needed to report performance: 49 percent

 

Additional key findings from the report appear below:

  • Less than one in 10 physicians felt deeply knowledgeable about QPP and its requirements.
  • Seven in ten respondents have begun preparing to meet the requirements of the QPP in 2017.
  • Of those respondents expecting to participate in the Merit-Based Incentive System (MIPS) in 2017, 90 percent feel MIPS requirements are slightly or very burdensome.
  • Respondents said that the time required to report is the most significant challenge today.
  • Even those who feel prepared still don’t fully understand the financial ramifications of the program.

 

How Does MACRA Affect Hospitals?

 

MACRA’s financial impact on hospital Medicare revenue in 2015-2030 is projected to be anywhere from a $32 billion increase to a $250 billion decrease, according to a recent study in Health Affairs. The losses would result from physician responses that reduce the use of hospital care, such as implementing steps to avoid admissions and readmissions. This should give hospitals a big incentive to focus on the physician payment overhaul. (“Half of Hospital-Based Physicians Not Knowledgeable About MACRA: Survey,” HFMA Weekly, July 8, 2017)

 

Hospital efforts to educate their employed and affiliated physicians also were evident in the survey. Almost half (45 percent) of the responding physicians reported receiving educational or training sessions on QPP from their practice, hospital, or health system, compared with only 22 percent from a medical society. (“Half of Hospital-Based Physicians Not Knowledgeable About MACRA: Survey,” HFMA Weekly, July 8, 2017)

 

To read the KPMG/AMA report Are Physicians Ready for MACRA/QPP? click here.

 

 

Check your library for the advanced Finance Course, Financial Risks & Strategic Implications of APMs, featuring Marian Jennings and Seth Edwards. In this course, Marian and Seth discuss the financial risks of ACOs and bundled payments, the strategic risks of not participating in an alternative payment model, clear trends and the characteristics of organizations that have successfully implemented one or more alternative payment models.

 

 

For a complete list of iProtean courses, click here.

 

 

For more information about iProtean, click here.