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October 25, 2016



MACRA/Quality Payment Program Final Rule

CMS Talks Reducing Medical Record Review

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MACRA/Quality Payment Program Final Rule

On October 14, 2016, the U.S. Centers for Medicare & Medicaid Services (CMS) released the final rule for Medicare’s Quality Payment Program, which implements the Medicare Access and CHIP Reauthorization Act (MACRA) and replaces the Sustainable Growth Rate (SGR) formula. The American Association of Orthopaedic Surgeons (AAOS) in June submitted comments to CMS that outlined a number of areas of concern with the original proposal, including the implementation timeline, restrictive requirements for Advanced Alternative Payment Models (APMs), and the impact on smaller or solo practices. While it appears CMS has been responsive to some of these concerns, AAOS leadership and staff are closely reviewing the final rule and will be providing CMS with additional comments. AAOS will also be providing detailed analyses and updates to all AAOS members.
“AAOS acknowledges CMS’s work to hear physician concerns and incorporate important feedback,” said AAOS President Gerald R. Williams, Jr., MD. “The ‘Pick Your Pace’ flexibility for 2017 and improved low-volume threshold, for example, are positive steps in addressing issues identified in the original proposal. Reducing the administrative burden on clinicians and increasing flexibility in reporting requirements and eligibility rules are important; and while AAOS is strongly opposed to mandatory participation in bundled payment models, it is also important to quickly finalize the Comprehensive Care for Joint Replacement (CJR), surgical hip/femur fracture treatment (SHFFT), and Bundled Payments for Care Improvement (BPCI) Advanced APM design parameters. We will continue to work closely with CMS to ensure physician payment reform ultimately improves the care of musculoskeletal patients.”

One of the changes from the proposed rule is that CMS expects more small practices to be excluded from the Merit-based Incentive Payment System (MIPS) reporting requirements due to a low-volume threshold, which has been set at less than equal to $30,000 in Medicare Part B allowed charges or less than or equal to 100 Medicare patients. This low volume threshold has been raised from what was initially proposed in response to stakeholder comments (the proposed rule called for a threshold of $10,000 in annual Medicare revenue and less than 100 Medicare patients).

In the final rule, CMS also detailed the “Pick Your Pace” flexibility that was first announced in September (read more in Advocacy Now online here), which is designed to give both clinicians and CMS time to build capabilities and gain experience with the program. In 2017, clinicians can choose their course of participation from four options:

  1. Clinicians can choose to report to MIPS for a full 90-day period or the full year and maximize the MIPS eligible clinician’s chances to qualify for a positive adjustment. In addition, MIPS eligible clinicians who are exceptional performers in MIPS, as shown by the practice information that they submit, are eligible for an additional positive adjustment for each year of the first 6 years of the program.
  2. Clinicians can choose to report to MIPS for a period of time less than the full year performance period 2017 but for a full 90-day period at a minimum and report more than one quality measure, more than one improvement activity, or more than the required measures in the advancing care information performance category in order to avoid a negative MIPS payment adjustment and to possibly receive a positive MIPS payment adjustment.
  3. Clinicians can choose to report one measure in the quality performance category; one activity in the improvement activities performance category; or report the required measures of the advancing care information performance category and avoid a negative MIPS payment adjustment. Alternatively, if MIPS eligible clinicians choose to not report even one measure or activity, they will receive the full negative 4 percent adjustment.
  4. MIPS eligible clinicians can participate in Advanced APMs, and if they receive a sufficient portion of their Medicare payments or see a sufficient portion of their Medicare patients through the Advanced APM, they will qualify for a 5 percent bonus incentive payment in 2019.

In addition, CMS further reduced reporting requirements, extended the MACRA “transitional” period into 2018, and will allow physicians to participate in virtual groups beginning in 2018. Further, as mandated by the MACRA statute, $100 million in technical assistance will be available to MIPS eligible clinicians in small practices (15 clinicians or less), in rural areas, and in practices located in geographic health professional shortage areas (HPSAs). CMS also announced that the agency is leading an outreach effort to individual clinicians nationwide to help them prepare for the Quality Payment Program and improve the clinician experience with Medicare (see “CMS Talks Reducing Medical Record Review”). Finally, per the MACRA statute, CMS is working with the U.S. Government Accountability Office (GAO) to submit a report to Congress, no later than January 1, 2017, on whether entities that pool financial risk for physician practices, such as independent risk managers, can play a role in supporting these small practices.

Visit the AAOS MACRA resource page for all materials and updates: For any questions, concerns, or comments, email