Medicare ‘Doc Fix’ Might Need Fixing Itself

In the spring of 2015, a rare bipartisan supermajority in Congress passed a healthcare bill.

This bill, the Medicare Access and CHIP Reauthorization Act (MACRA), alters how the government pays doctors who treat Medicare enrollees. Both Democrats and Republicans touted the bill as a solution to the flawed method Medicare had been using to pay doctors, and though many were loath to admit it, the MACRA vote represented many Republicans’ first vote in favor of some aspect of the Affordable Care Act (ACA), or “Obamacare.”

There are several main goals of the bill, but one of the main ones is changes affecting healthcare IT systems. Under MACRA, three existing programs, the Medicare Electronic Health Record (EHR) Incentive Program, the Physician Value-based Payment Modifier (VM), and the Physician Quality Reporting System (PQRS) are combined into a single set of reporting requirements. Current payment adjustments under the current three systems are scheduled to sunset under MACRA.

Clinicians affected by MACRA will be expanded to include not only physicians, but also physician assistants, nurse practitioners, clinical nursing specialists, and certified registered nurse anesthetists. The first performance period under MACRA is scheduled to start in January 2017, with payments being adjusted based on that performance period starting in 2019. Under this zero-sum redistribution of payments, some clinicians will experience reduced payments, and some will experience enhanced payments, ostensibly based on performance and quality.

Examples of New Metrics Under MACRA

Under the new law, several new metrics will be implemented. For example, the “Secure Messaging Metric” will document that the electronic messaging function of a certified EHR system will be sent securely to at least one unique patient or patient-authorized representative. The View, Download, Transmit (VDT) metric requires that at least one unique patient (or authorized patient representative) engages with the EHR to perform some function like accessing their health information or that the clinician view, download, or transmit their health information to an approved recipient on behalf of the patient.

What this actually means for clinicians is that for the entirety of 2017, clinicians must use a 2014- or 2015-certified EHR, report on multiple advancing care information objectives, attest that they are cooperating in good faith with government review of their EHR, and attest to their support for secure healthcare information exchange and the prevention of blocking of this data.

Why Doctors Don’t Like MACRA

As you might imagine, doctors aren’t too happy with all these new requirements being heaped on their already-full plates. Prior to the law, the Centers for Medicare and Medicaid Studies (CMS) used a method called the Sustainable Growth Rate (SGR) to control Medicare spending on physician services. The SGR was a method to ensure that annual increases in expense per Medicare beneficiary were not greater than Gross Domestic Product (GDP) growth. Every year in March, the CMS physician fee schedule would be updated, but updates could be (and often were) suspended or adjusted by Congress. MACRA does away with the SGR, which many physicians weren’t thrilled with, but which they considered better than the math used by MACRA.

Another major point of contention among physicians is that it would appear that the doctors taking the biggest hits under MACRA are doctors in solo practice, and those in small group practices. Simultaneously, the vast majority of clinicians in very large systems (and their employers) stand to benefit most under MACRA.

Will Implementation Be Delayed?

Acting Administrator of CMS Andy Slavitt has recently said that the blizzard of comments about MACRA from practicing physicians may cause implementation of MACRA to be delayed to some point after January 2017. If this happens, says Slavitt, changes could be made to improve MACRA, which came in for a scathing review in a report published by the National Center for Policy Analysis (NCPA).

The thing is, since MACRA had strong bipartisan support, it’s unlikely to be repealed and replaced altogether. However, the NCPA has two main suggestions on how to improve Medicare physician payments.

First, they suggest that Medicare Part D (prescription drug) claims should be included along with Part A (hospital) and Part B (outpatient) claims as costs for which physicians are held accountable. This would presumably incentivize physicians to prescribe more appropriately and bring costs down. Second, they recommend ditching current Resource-Based Relative Value Scale in favor of paying for care “bundles” without fixed government fees.

Clinicians Not Ready for the New Law

Many doctors and other providers are just straight-up not ready for the new law. In fact, many of them didn’t really know about it until after it was passed. Solo and small practices in particular hope for a delay in the start of MACRA, and Slavitt has insisted that CMS is devoted to helping these smaller practices cope. One possible change may be comparing performance of small practices to other small practices rather than to large, powerful healthcare organizations. Another is the creation of virtual groups that could tackle the requirements together and spread out the workload.

Additionally, the Department of Health and Human Services (HHS) plans to spend $20 million per year over the next five years to support MACRA training and education for clinicians in small practices. Still, many solo practitioners predict their independence will end and they’ll have to join larger healthcare systems due to changes under MACRA.

Meanwhile, Baby Boomers Enroll in Medicare in Large Numbers

Unfortunately, all this is going on at the same time as the Medicare population is increasing steadily due to the aging baby boom generation. From the current 54 million beneficiaries, the Medicare population is expected to exceed 80 million by 2030. The health status of all these future Medicare enrollees is to be determined as well. Fewer of them are smokers than their elders, but they have higher rates of chronic conditions like diabetes and obesity. So the effects of all these baby boomers retiring and enrolling in Medicare are yet to be seen and could be significant.

The good news is, the 114th Congress reached rare bipartisan agreement on a piece of legislation, but the bad news is many healthcare providers are unhappy with it. Healthcare providers are already coping with numerous regulatory and population changes, plus large influxes of new patients as more Americans are able to purchase health insurance. The requirements of MACRA, believe many smaller practices, may be overwhelming and force them to join larger, less independent healthcare systems. It’s still possible that implementation of MACRA will be delayed, but a decision has not yet been made.

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