MACRA – Physician Payment Reform

What is MACRA?


  • On April 16, 2015 President Obama signed into law the Medicare Access and CHIP Reauthorization Act of 2015.
  • MACRA is changing the healthcare reimbursement system in the most significant and far reaching way since the program’s inception in 1965.
  • MACRA repealed the flawed Sustainable Growth Rate (SGR) payment system that governed how physicians and other clinicians were paid under
  • The fee-for-service reimbursement model is being replaced the Quality Payment Program, a  new two-track system: Merit-Based Incentive Payment System (MIPS) and/or Advanced Alternative Payment Models (APMs).
  • The Quality Payment Program performance period begins in 2017.
  • Providers will see revenue impacted by 2019.
MACRA 2016 - MIPS Adjustment Factor
cps formula for MACRA rule

Merit –Based Incentive Payment System (MIPS)

Portion of practice Medicare revenue at risk at tax ID or individual levels based on performance in these categories:

Measure Category Year 1 (2019) Year 2 (2020) Year 3 (2021)
( aka PQRS)
60% 45% 30%
Cost – Resource Use
(aka VM)
0% 15% 30%
Advancing Care Information
(aka MU)
25% 25% 25%
Improvement Activities
(IA – New)
15% 15% 15%

Advanced Alternative Payment Models (APM)

No downside risk on Part B fee schedule if thresholds are achieved through an ‘Advanced’ APM:

*Thresholds2019 2019-2020 2021-2022 2023+
% Payments 25% 50% 75%
% Patients 20% 35% 50%

Initial Advanced APMs:

  • Comprehensive Primary Care Plus (CPC+)
  • MSSP Tracks 2 & 3 and Next Gen ACO
  • Oncology Care Model Two-Sided Risk
  • Comprehensive ESRD Care Model (CEC)
  • Comprehensive Joint Replacement (CJR)

MACRA will have a profound effect on the entire health care continuum.  From solo practitioners to large health systems, this overhaul of the Part B payment system has significant implications:

  • From 2019 on, providers will not be paid the same for services provided to Medicare patients (ranging from 91% to +127% or more of Medicare).
  • Performance in MIPS categories will be publicly available on Physician Compare.
  • Providers transitioning to Advanced APMs will minimize downside risk and receive a +5% annual lump sum bonus (2019 – 2024).
  • Medicare Physician Fee Schedule differential of .5% between MIPS and Advanced APM providers from 2026 forward.

There is a lot to do to prepare for the first performance period which begins January 2017.  Here’s how we can help:

MACRA Readiness Assessment

  • Identify the economic impact of MIPS vs Advanced APM path.
    • Year over year cumulative impact
    • Best and worse case scenarios
    • Advanced APM impact
    • Long term Medicare fee schedule multipliers
  • Educate key stakeholders – providers, administrators, clinical and business office staff.
  • Assess performance in current CMS quality programs including:
    • Physician Quality Reporting System (PQRS)
    • Value Modifier (VM) using Quality and Resource Use Reports (QRURs)
    • Meaningful use (MU)
  • Review MIPS measures and reporting mechanisms.
    • Quality
    • Cost
    • Advancing Care Information
    • Clinical Practice Improvement Activities
  • Understand potential for Advanced APM path.

MACRA – Action Plan

We will develop your practice MACRA Action Plan framing key milestones and timelines:

Key Components:

  • Understand how measures pertain to your practice.
  • Decide which measures are most meaningful and effective.
  • Identify individuals responsible for each measure component.
  • Spell out timelines and milestones.
  • Determine plan for vendor involvement and establish road map.
  • Deploy the MACRA Action Plan and proactively position for the future.

We use the results from the study to identify high-level gaps in infrastructure and/or workflow that could affect program performance and determine the degree of preparedness for MIPS (by category) and/or APMs. You will walk away with a roadmap to optimize performance in the Quality Payment Program, and we can help you implement the recommendations with as little or as much assistance as you need.

Contact us to begin your MACRA Readiness Assessment now.