You are using an outdated browser. Please upgrade your browser to improve your experience.

You are here

Questions and Answers about MACRA

Understand your options under the Medicare Access and CHIP Reauthorization Act of 2015. Learn how to succeed in either of the two payment tracks.

What is MACRA?

The Medicare Access and CHIP Reauthorization Act of 2015 was signed into law on April 16, 2015. The law eliminated the sustainable growth rate (SGR) formula that had previously been used to calculate Medicare payments to physicians and had resulted in repeated threats of severe payment cuts. The law provides a more predictable Medicare payment schedule for physicians and other clinicians, while moving the payment system away from a volume-based system toward a system that rewards value. 
The proposed rule for implementation was released and comments accepted until June 27th. The final rule is expected in the fall of 2016.

What is the Quality Payment Program?

The April 27, 2016, Notice of Proposed Rule Making (NPRM) establishes the framework of the new Quality Payment Program under MACRA. Comments on the proposed rule were submitted in June and a final rule is expected sometime in the fall.  ACP suggested many improvements to the proposed rule, with particular attention to how small practices and subspecialists can succeed in the new program.

Does this program apply to me?

This program applies to clinicians that receive Medicare Part B payments. If you are (1) in your first year of participation in Medicare Part B, (2) are below the low volume threshold, or (3) are in certain types of Alternative Payment Models, then you are exempt from the program and will receive neutral payment adjustments. The proposed low volume threshold is under $10,000 in Medicare Part B charges AND 100 or fewer Medicare Part B patients.  

What if I don’t want to participate in either MIPS or an APM?

MACRA applies to all physicians and other clinicians who participate in Medicare Part B.

There are three groups of physicians and other clinicians who will not be subject to MIPS:

  • Those who are in their first year of Medicare participation.
  • Those who are participants in eligible APMs and who are QPs.
  • Those who fall under a low-volume threshold for treating Medicare patients (<$10,000 in Part B charges OR <100 Part B patients).

How will physicians be evaluated under MIPS?

Physicians participating in MIPS will receive a score in four weighted categories.

  • Quality, weighted at 30 percent.
  • Resource Use, weighted at 30 percent.
  • Clinical Practice Improvement Activities, weighted at 15 percent.  
  • Meaningful Use of Certified EHR Technology, weighted at 25 percent. 

These categories will be combined into one number called the MIPS Composite Performance Score.

What are the different payment tracks in MACRA?

Starting in 2019 physicians will begin participating in either the Merit-Based Incentive Payment System (MIPS) or an Advanced Alternative Payment Model (APM) to earn additional increases in their Medicare payments. Physicians, or their practices, will be in MIPS unless they meet the criteria for an Advanced APM.

How will MACRA calculate the baseline for physician payments?

From January 2016 through December 2019 all physicians will receive a 0.5 percent payment increase each year on their Medicare reimbursements—and starting in 2019, this baseline will be the starting point for incentives from either the MIPS or APM payment track. 

Then, starting in January 2020 there will no longer be automatic baseline payment increases each year. For those in the MIPS program, the payment adjustments will be exclusively based on performance within MIPS (these payment adjustments are described in more detail below).

For those that are deemed Qualified Participants (QPs) due to their participation in the advanced APM track, from January 2019 through December 2024, QPs will receive a positive 5 percent bonus payment on their Medicare fee-for-service reimbursements, as well as any incentives that are built into their APM (e.g., care coordination or infrastructure payments, shared savings, etc.). Then, starting in 2026, QPs in the APM track will receive a 0.75 percent baseline payment increase on their Medicare fee-for-service reimbursements indefinitely—as well as any ongoing incentives that are part of their APM.

What is MIPS?

The Merit-Based Incentive Payment System (MIPS) builds on traditional fee-for-service payments by adjusting them up or down based on a physician’s performance in a new reporting system. This new reporting system will combine several existing Medicare reporting programs; the Physician Quality Reporting System (PQRS), the Medicare EHR Incentive Program (also known as Meaningful Use), and the Value-Based Payment Modifier Program—and also adds in a new component, Clinical Practice Improvement Activities.

In Year 1 (2019) physicians participating in MIPS will receive a composite score based on four weighted categories:

  • Quality = 50% (This percent will gradually decrease to 30% in future years.)
  • Resource Use (or cost) = 10%  (This percent will gradually increase to 30%.)
  • Clinical Practice Improvement Activities=15%  
  • Advancing Clinical Information (formerly known as meaningful use)=25% 

These categories will be combined into one number called the MIPS Composite Performance Score.

How will they determine payments under MIPS?

MIPS payments will be the Medicare base rate (described above) in addition to a physician’s composite performance score adjusting his or her payments up or down. 

  • In 2019, the first year of the program, payments can go up or down by 4 percent. 
  • In 2020, physician payments can go up or down by 5 percent.
  • In 2021, physician payments can go up or down by 7 percent.
  • In 2022 and beyond, physician payments can go up or down by 9 percent. 

Payments can never be reduced by more than the level set in the law. However, in order to make the adjustments budget neutral, the upward adjustments may have a scaling factor applied to make the total upward and downward adjustments equal to each other. 

Additionally, physicians who are determined to be an exceptional performer will be eligible to receive an additional positive payment adjustment of up to 10 percent. This exceptional performer payment adjustment is not budget neutral but will come from a separate designated fund.

What is an APM?

Alternative Payment Models (APMs) are a new approach to paying for medical care that incentivizes quality and value. According to the law, initially Medicare APMs will include:

  • CMS Innovation Center models,
  • The Medicare Shared Savings Program,
  • Demonstrations under the Health Quality Demonstration Program, and
  • Other demonstrations initiated by Federal law. 

Some APMs will qualify as “Advanced APMs” (link to Q below). Over time, additional types of Advanced APM options will become available. Advanced APMs largely involve accepting risk based on the quality and effectiveness of care provided, like in an accountable care organization (ACO). However, Medical Homes (initially as expanded under the CMS Innovation Center—currently there are none) can qualify as an APM without taking on financial risk.

What is an Advanced APM?

Some APM participants will qualify to receive an additional 5% lump sum payment and a higher fee schedule in future years. As of the release of the NPRM on April 27, only participation in the following programs will qualify as Advanced APMs:

  • Comprehensive Primary Care Plus (CPC+)
  • Medicare Shared Savings Plan Tracks 2 & 3
  • Next Generation ACOs
  • Oncology Care Models with 2-sided risk
  • Comprehensive ESRD Care Model (Large Dialysis Organization arrangements)

Over time, as CMS modifies and expands the criteria, more models will qualify as advanced APMs. ACP is working to expand the options for advanced APMs, especially so that it will be easier for small practices to participate.

What is the difference between an APM, an Advanced APM, and a Qualifying APM participant?

As noted above, an APM is defined as a new approach to paying for medical care through Medicare that incentivizes quality and value. However, not all APMs are “advanced APMs.” Advanced APMs meet the following criteria:

  • They base payment on quality measures comparable to those in MIPS.
  • They require the use of certified EHR technology.
  • They either (1) bear more than nominal financial risk for monetary losses OR (2) are a Medical Home as expanded under the CMS Innovation Center authority.

Qualifying APM participants (or QPs) are the clinicians who have a certain percentage of their patients or payments through an eligible Advanced APM.

How will physicians be evaluated under an APM?

Physicians who participate in an APM that is not determined to be an advanced APM will be participants in the MIPS program; however, they will receive favorable scoring under MIPS.

Those that participate in an advanced APM—i.e., physicians who are QPs—will:

  • Be paid according to the rules established as part of their APM (e.g., care coordination or infrastructure payments, shared savings, bundled payments, etc.).
  • Not be subject to MIPS.
  • Receive a 5 percent lump sum bonus payment on their fee-for-service reimbursements for years 2019-2024.
  • Receive a higher fee schedule update for years 2026 and beyond (0.75 percent).

Not all clinicians in an Advanced APM will qualify – they must have a certain number of patients or payments from the Advanced APM. The proposed thresholds are a calculated ratio and increase each year of the program.

How do I know if my ACO or APM meets the criteria of an Advanced APM?

Do clinicians qualify as individuals or as part of a group?

Eligible clinicians can participate in MIPS either as an individual or under the TIN of their group.

What should I be doing now to get ready for the transition to the new Quality Payment Program?

See ACP’s list of 10 Things to Do for MACRA

My practice is a certified Patient-Centered Medical Home/Patient-Centered Specialty Practice.  Where does that fit into this new program?

Patient-Centered Medical Homes (PCMHs) are strongly incentivized under both pathways in the following ways:

  • Within MIPs, all certified PCMHs (and Patient Centered Specialty Practices) will receive full credit for the clinical practice improvement activities category (i.e., you will receive the 15 percent credit for this item toward your overall composite score).
  • Within APMs, Medical Home Models are identified as being able to qualify (initially via expansion of CMS Innovation Center programs) as eligible APMs without having to bear financial risk.

However, as defined by the proposed rule, for a Medical Home Model to be defined as an Advanced APM, it must have the following features: 

  • Participants include primary care practices or multispecialty practices that include primary care physicians and practitioners and offer primary care services.
  • Patients are empaneled to a primary clinician; and
  • At least four of the following:
    • Planned coordination of chronic and preventive care.
    • Patient access and continuity of care.
    • Risk-stratified care management.
    • Coordination of care across the medical neighborhood.
    • Patient and caregiver engagement.
    • Shared decision-making.
    • Payment arrangements in addition to, or substituting for, fee-for-service payments.

What else can I do to qualify as a Qualified Participant (QP) in an Advanced APM?

You could also begin to investigate if there are APM options in your area that are underway or being initiated by private payers or other stakeholders—getting involved in these programs, which could provide some supports and helpful services to transition to a more value-based payment system, may be beneficial to your success in either MIPS or APMs down the line.

Is it too late for me to participate in PQRS or MU?

No! Since 2016 is the performance year affecting payments in 2018, participation in the current PQRS and/or Meaningful Use programs is highly recommended. Also review the feedback reports that you receive as part of the Value-Based Payment Modifier Program.  These programs that will serve as the building blocks of the new MIPS pathway (hopefully along with significant improvements) and so becoming familiar with them now, even in their last years of operation, will be beneficial. More information about these programs is available on ACP’s Physician and Practice Timeline. MACRA’s Quality Payment Program does not begin until 2017 (for payments in 2019).

Does the Quality Payment Program apply to private insurance companies?

No. This program only applies to Medicare Part B fee-for-service at this time.  

Does the proposed medical home size limitation mean that larger systems could not use CPC+ to count as an advanced APM?

As the proposed rule is written, it does restrict larger groups (>50 clinicians) from being in CPC+ to count as an advanced APM. However, it is unclear how an entity or TIN is defined. For instance, is it the size of the billing TIN or the ownership TIN (such as the hospital system)? Until the rule becomes final, there may not be a definitive answer.

Where can I learn more about what’s coming up?

ACP has been covering the transition to the new systems to keep members up-to-date on the progress that is being made. You can find coverage in the ACP Internist, the ACP Advocate newsletter, and the ACP Advocate blog. As more news and resources become available we’ll be linking to them from this page, so check back here