1. © 2016 Making MACRA Work Implementing Value-Based Payment and Improving Care in a New Environment May 20, 2016 Elizabeth Mitchell

2. NRHI file:///.file/id=657136 7.45249208 Health Spending as a Share of GDP United States, 1962 to 2022 We have a problem. 2

3. NRHI The move to value payment.

4. NRHI What is “MACRA”? The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) is bipartisan legislation signed into law on April 16, 2015. What does MACRA do? Repeals the Sustainable Growth Rate (SGR) Formula Changes the way that Medicare pays clinicians for value over volume Streamlines multiple quality programs under the new Merit- Based Incentive Payments System (MIPS) Provides bonus payments for participation in certain “advanced” alternative payment models (APMs) 4

5. NRHI In January 2015, the Department of Health and Human Services announced new goals for value-based payments and APMs in Medicare MACRA is part of a broader push towards value and quality. 5

6. NRHI APM Framework CMS Framework for Payment Models 6 Source: Rajkumar R, Conway PH, Tavenner M. CMS ─ engaging multiple payers in payment reform. JAMA 2014; 311: 1967-8. For limited release (LAN CMS Participants and GC Members Only)

7. NRHI Over time, the desire is to influence a shift in payment models to Categories 3 and 4 Note: Size of “bubble” indicates overall investment in each category of APM Over time, APMs will move up the Y-axis and there will be more investment in the higher categories Conceptual diagram of the desired shift in payment model application given the current state of the commercial market* *Source: CPR 2014 National Scorecard on Payment Reform, based on the National commercial market using 2013 data.

8. NRHI MIPS changes how Medicare links performance to payment There are currently multiple individual quality and value programs for Medicare providers: MACRA streamlines those programs under MIPS: 8 Physician Quality Reporting Program (PQRS) Value-Based Payment Modifier Medicare EHR Incentive Program Merit-Based Incentive Payment System (MIPS)

9. NRHI Based on the MIPS composite performance score, providers will receive positive*, negative, or neutral adjustments up to the percentages below. MIPS adjustments are budget neutral. MAXIMUM Adjustments Adjustment to provider’s base rate of Medicare Part B payment 4% 5% 7% 9% 2019 2020 2021 2022 -------------> Merit-Based Incentive Payment System (MIPS) 9 -4% -5% -7% -9% *Some exceptional performers will be eligible for additional upward adjustments of up to 10%

10. NRHI10 The “Quality Payment Program” payment pathways 2025 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2026 PQRS, VBPM, meaningful use adjustments 0.5% PFS payment update 5% bonus Permanent repeal of SGR 0.0% PFS payment update Merit-based Incentive Payment System (MIPS) ` 0.25% update Qualifying Advanced APM Participant Incentives for “exceptional performers” CMS is proposing to implement MACRA through a unified framework called the “Quality Payment Program,” which includes two payment pathways

11. NRHI Performance Period and Payment Year 11 201720182019 Performance Year 1Payment Year 1 CMS evaluation and determination of MIPS adjustment or eligibility for QP bonus

12. NRHI A single MIPS composite performance score will incorporate performance in 4 weighted performance categories: MIPS Composite Performance Score Quality Resourc e use Clinical practice improvemen t activities Meaningful use of certified EHR technology How will providers be scored under MIPS? 12 

13. NRHI What are the MIPS Performance categories? 13 2019 20202021+ Quality Resource Use Clinical Practice Improvement Activities Advancing Care Information

14. NRHI Which APMs are “Advanced APMs”? 14 MACRA APMs: CMMI Model MSSP ACO Model developed through other federal demonstration authorities MACRA APMs: CMMI Model MSSP ACO Model developed through other federal demonstration authorities Are paid based on quality measures “comparable” to MIPS Is a Medical Home Model expanded by CMMI Use certified EHR Bears more than nominal financial risk for losses Or And …where physicians…and the entity

15. NRHI Proposed financial risk criterion narrows current options 15 APMAdvanced APM? Next Generation ACOsYes MSSP ACOs Track 1No MSSP ACOs Track 2Yes MSSP ACOs Track 3Yes Bundled Payment for Care ImprovementNo Comprehensive Care for Joint ReplacementNo Comprehensive Primary Care PlusYes Medicare Part B Drug Payment ModelNo Oncology Care Model 1-sided risk arrangementNo Oncology Care Model 2-sided risk arrangementYes Comprehensive ESRD Care model (2-sided risk)Yes 86% of Medicare ACOs are in Track 1

16. NRHI Independent PFPM Technical Advisory Committee 16 PFPM =Physician-Focused Payment Model Encourage new APM options for Medicare providers. Technical Advisory Committee (11 appointed care delivery experts) Submission of model proposals Review proposals, submit recommendations to HHS Secretary Secretary comments on CMS website, CMS considers testing proposed model    For more information on the PTAC, go to: https://aspe.hhs.gov/ptac-physician-focused-payment- model-technical-advisory-committeehttps://aspe.hhs.gov/ptac-physician-focused-payment- model-technical-advisory-committee

17. NRHI The MIPS will be the dominant pathway, even for APM participants 17 Qualifying APM participants (“QPs”) in Advanced APMs Advanced APMs

18. NRHI Key Takeaways 18 MIPS is the dominant payment track Performance during 2017 will dictate 2019 payment impact CMS has tried to increase flexibility and reduce administrative burden on physicians, and proposes special accommodation for small practices, but practices will still need to make at least some minimum investment Payment impact on practices will vary by specialty, practice size, and level of preparedness; small practices and solo practitioners are most vulnerable to negative payment adjustments

19. NRHI How will performance scores translate into a payment adjustment? 19 A single MIPS composite performance score of 0-100 will factor in performance in the 4 weighted performance categories The CPS will be compared to the MIPS performance threshold to determine the adjustment percentage the eligible clinician will receive

20. NRHI Estimated MIPS Impact by Practice Size 20 % With Positive or Negative MIPS Adjustment

21. NRHI Sustainable reforms will require stakeholder buy-in 21 Actionable data Technical assistance Financial incentives Meaningful measurement

22. NRHI NRHI Membership Better Health Partnership California Quality Collaborative (subsidiary of PBGH) Center for Improving Value in Healthcare (CIVHC) Community First, Inc. Finger Lakes Health Systems Agency Great Detroit Area Health Council (GDAHC) Health Insight - Nevada Health Insight - New Mexico Health Insight - Utah Healthcare Collaborative of Greater Columbus Institute for Clinical Systems Improvement (ICSI) Integrated Healthcare Association (IHA) Iowa Healthcare Collaborative Kentuckiana Health Collaborative Louisiana Health Care Quality Forum Maine Health Management Coalition Maine Quality Counts Massachusetts Health Quality Partners Michigan Center for Clinical Systems Improvement Midwest Health Initiative Minnesota Community Measurement Mountain-Pacific Quality Health Foundation (MPQHF) MyHealthAccess New Jersey Health Care Quality Institute North Coast Health Information Network North Texas Accountable Healthcare Partnership Oregon Q Corp P2 Collaborative (Western NY) Pacific Business Group on Health Pittsburgh Regional Health Initiative (PRHI) The Health Collaborative (includes: Health Collaborative, Greater Cincinnati Health Council, and Health Bridge) Washington Health Alliance Wellspan (formerly South Central PA) Wisconsin Collaborative for Healthcare Quality Wisconsin Health Information Organization (WHIO) 22