What is MACRA?

Are you ready for MACRA?

Every couple of years, seemingly out of nowhere, a trending topic pops up in the healthcare industry that shakes everyone’s roots. In 2015, it was the Affordable Care Act – in 2005, RAC Audits, SGR in 1997 and HIPPA Compliance in 1996.  With each push for something new, comes a new wave of fear in the medical community.  The latest in the healthcare industry seems to be MACRA, MIPS, and APMs, and everyone is scrambling to understand how it works and how it affects them most.

According to the Centers for Medicare and Medicaid Services (CMS), MACRA is a change in the way Medicare rewards physicians for healthcare services.  The Medicare Access and CHIP Reauthorization Act of 2015, or MACRA, provides 3 major changes in physician payments.

  1. MACRA put an end to the Sustainable Growth Rate (SGR).
  2. MACRA rewards physicians for quality of care rather than paying by volume of patients.
  3. MACRA creates a new reporting system combining other previously successful systems into one.

With the goal of making Medicare better, MACRA helps providers focus on quality of care and replaces the Sustainable Growth Rate (SGR), which was designed to keep growth in spending for Medicare slower than the U.S. GDP. However, the SGR turned out to be not sustainable, and it was put to rest in 2015.  From that point on, Medicare reimbursements increase by 0.5% per year for the next 5 years.  Providers can choose between 2 payment options: MIPS or APMs, and they choose which plan to participate in based on practice size, specialty, locations, or patient population.

  • Merit-Based Incentive Payment System (MIPS)
    A combination of 3 payment programs already in place, and it provides incentives through measuring four metrics: quality, efficiency, meaningful use, and clinical practice improvements.  Providers will be assessed and given a score between 0 and 100 ¹  and will have payment adjustments based on their score.  Most physicians will be in MIPS.  Physicians who will not participate in MIPS are those in their first year of Medicare Part B participation, those with Medicare billing charges less than or equal to $10,000 and patient volume below 100, and those participating in APMs.
  • Advanced Alternative Payment Model (APMs)
    APMs give incentives to providers to move Medicare away from Fee-For-Service programs and toward payment based on patient outcomes and Population Health. APMs are designed for physicians participating in ACOs, PCMHs, or bundled payment programs ².  APM providers will receive an annual lump sum bonus of 5% starting in 2019.

What is Macra, MIPS and APM Image

What does MACRA mean for practitioners and hospitals?

For both hospitals and practitioners, MACRA means risk for payment adjustments. Of course there are incentives and ways to increase reimbursements, but compliance and proving qualifying measurements may mean a larger portion of physicians’ payments are at risk.  The American Hospital Association suggests this may mean a continued shift in hospital-physician relationships and more collaboration.

While MACRA is a very complex and detailed program, we are trying to provide a high level summary to put it in its simplest form. We understand that things are always changing in healthcare, and we’re here to help you navigate the changes so you can focus on providing the highest quality of care to your patients.