Becker's Hospital Review

34 MACRA: Who Will Win; Who Will Lose? By Emily Rappleye W e expect to see ongoing shis with the Medicare Access and CHIP Reauthorization Act's Quality Payment Program as feedback is received from stakeholders regarding implica- tions. Regardless of these shis, MACRA continues to drive changes in how care is delivered, improve patient health and increase care effi- ciency over time. QPP policy changes and newly proposed adjustments continue to restructure how eligible clinicians are paid under Medi- care. ese changes can pose both threats and opportunities to future payer and provider revenue. With the first reporting year of the QPP already underway, craing a MACRA strategy can't be avoided. Although the QPP's Merit-based Incentive Payment System allows eligible physicians to opt out of re- porting, they will take a 4 percent hit on 2019 Medicare reimburse- ments if they do so, and perhaps more importantly, be at a disadvan- tage by not evaluating, planning and testing their MACRA strategy for future years. Hospitals and payers are not exempt from MACRA either — to be successful under the law, hospitals and payers need to stay ahead of changes and lay the groundwork as early as possible, accord- ing to experts from Optum. "MACRA is a zero-sum game. ere will be winners and there will be losers," Jim Dolstad, Optum's senior director of actuarial consulting, said in an interview with Becker's Hospital Review. is article is the first in a 3-part series looking at the short- and long- term impact of MACRA from the perspective of physicians, hospitals and payers. Part one discusses how MACRA can impact long-term financial success and how each of the major industry stakeholders — physicians, hospitals and payers — can position themselves to thrive with their patients in the future. Financial implications of MACRA strategy e best long-term financial strategy for providers looking to succeed, based on MACRA's intent and policies, is to work toward qualifying for the Advanced Alternative Payment Model track, according to Erik Johnson, vice president of Optum's value-based care practice. Ad- vanced APMs, which offer physicians the potential to earn a 5 percent bonus on top of shared savings, provide a more stable path than MIPS and greater opportunity for financial rewards. "MIPS is inherently unstable. It already has physician groups nervous," he says. "Our recommendation is to move into the Advanced APM world, but that takes time. Quality is hard. Advanced APMs are hard. Otherwise everybody would already be doing it." e current reality is most physician practices do not qualify as ad- vanced APMs and are subject to MIPS reporting requirements for the 2017 performance year. Even if MIPS is only a temporary challenge, it's a significant one. Positive payments awarded to physicians with stron- ger performance are funded by payment reductions other physicians incur, meaning it's all relative — the program is designed to be bud- get-neutral, ranking physicians on a curve. is poses both an oppor- tunity and a threat to physician Medicare revenue, depending largely on three factors, according to Mr. Johnson — the measures physicians choose to report on, how well they perform on those measures and how well their peers perform in comparison. Implementation of the QPP will not only impact physicians, but also the hospitals and health systems with whom they partner. Hospitals that employ physicians directly may bear the cost of ongoing compli- ance requirements and additional physician performance reporting, as well as be at risk for payment adjustments. Moreover, hospitals' inpa- tient revenue may be in danger as MACRA encourages physicians to lower the costs of care. In fact, Jay Hazelrigs, vice president of Optum's provider risk advisory consulting practice, urges hospitals to think about MIPS as a large, informal ACO. To succeed in the program, physicians will be increasingly pushed to manage not only the quality of care, but also the cost of care through one of the track's four performance categories — resource use. In the first performance year, resource use will not be a factor in MIPS composite scores, but its weight is expected to increase to 10 percent in the 2018 performance year and then up to 30 percent in the 2019 performance year. Increasingly, physicians will be looking to eliminate inefficiencies and excess costs throughout the care continuum in ways that could reduce the use of hospital care, such as avoiding hospital ad- missions and readmissions and moving patients to lower-cost settings, thereby putting hospital revenue at risk, according to Mr. Hazelrigs. Levers for success MACRA has financial implications for healthcare stakeholders across the board. Despite the many challenges of participating in MIPS or an AAPM, physicians, hospitals and even payers can come out on top in a MACRA world with careful planning and strategy. Here are four tac- tics healthcare stakeholders can use to position themselves for success. 1. Evaluate past performance metrics. Physicians should start by taking an honest look at past Quality and Resource Use Reports to gain a better understanding of where they excelled previously in the Physician Quality Reporting System and the Value Modifier Program, which should be fairly similar to MIPS quality and resource use mea- sures, and to identify how much more administrative work they need to take on to comply with requirements. is historical look — plus a little game theory — can help guide physicians to select the best mea- sures for their practice. "Picking easier measures has an intuitive attraction. But if it's easy to aggregate data and fairly easy [to perform well], a lot of folks will end "MACRA is a zero-sum game. There will be winners and there will be losers." — Jim Dolstad, Senior Director of Actuarial Consulting, Optum

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