MACRA Quality Payment Program Update

On June 20, 2017, CMS released its proposed rule updating MACRA’s Quality Payment Program (“QPP”) for CY 2018. At over 1,000 pages, the rule might not do much to simplify the already complex requirements of the QPP; however, it would expand and extend the flexibility offered by CMS to practitioners in the 2017 performance period into the 2018 performance period, potentially reducing the program’s immediate burden. Nevertheless, as CMS’ ramp-up to full implementation of the program continues, practitioners should use any flexibility offered in the 2018 performance period as an opportunity to prepare for the imposition of potentially more onerous requirements in the 2019 performance period.

The Proposed Rule Would Offer New Flexibility for Opting Out of MIPS Participation in the 2018 Performance Period

The QPP offers two tracks. Practitioners may choose to participate in an advanced alternative payment model (“Advanced APM”); those that do not do so will be subject to the Merit-based Incentive Payment System (“MIPS”), under which payment will be adjusted based on performance scores in the areas of quality, improvement activities, advancing care information, and cost. Some practitioners, however, may be exempt from the QPP altogether based on falling below a low-volume threshold for Medicare Part B charges or patients. The proposed rule would expand that group of practitioners by increasing the low-volume threshold from under $30,000 in Medicare Part B charges or less than 100 Medicare Part B patients to under $90,000 in Medicare Part B charges or less than 200 Medicare Part B patients.

In addition, CMS is now offering additional opportunities for Advanced APM participation by adding the Medicare Track 1+ program as a qualifying APM and reopening applications for the Next Generation ACO program and the Comprehensive Care Plus program. These opportunities may allow many additional practitioners to opt into the advanced APM track instead of the MIPS track; CMS expects that the number of clinicians participating in the advanced APM track will double in 2018.

The Proposed Rule Would Offer New Scoring Flexibility for Practitioners Participating in MIPS in the 2018 Performance Year

Modified Pick-Your-Pace Approach. The proposed rule would continue much of the substantial flexibility offered to MIPS-participating practitioners in 2017 by extending a modified “pick-your-pace” approach to MIPS-participation requirements, with an only slightly higher bar for minimum participation. Specifically, practitioners would be required to submit 12 months of data in the quality category, instead of choosing a 90-day performance period; however, CMS would maintain a 90-day minimum performance period for the practice improvement activities and advancing care information technology categories.. Further, CMS would require practitioners to earn fifteen points in performance year 2018 (up from three points in performance year 2017), across the quality, improvement activities, and advancing care information categories, to avoid a payment penalty, but is seeking comments on whether or not this point threshold should be lower. CMS proposes to retain the 70 point threshold for earning an exceptional performance bonus.

Additional Reporting Mechanism Flexibility. Unlike in the 2017 performance period during which practitioners are required to use only one submission mechanism per performance category, in the 2018 performance period practitioners will be allowed to use multiple mechanisms within each category.

Extension of Cost Category Delay. Under the proposed rule, CMS would delay the inclusion of the cost category in the MIPS final score for an additional year, weighting performance in that area at zero percent. The MIPS final score for the 2018 performance year, therefore, would be (as in 2017) based 60% on quality, 15% on improvement activities, and 25% on advancing care information. However, the proposed rule anticipates implementing inclusion of the cost category with a thirty percent weight beginning in performance year 2019, as required by MACRA – practitioners should continue to track and implement measures to improve performance in this area to avoid struggling with this scoring category in 2019.

CEHRT Certification Reprieve. The proposed rule would also eliminate the requirement for MIPS-eligible providers to use 2015 Certified Electronic Health Record Technology (“CEHRT”), allowing the use of both 2014 or 2015 certified technology for the purposes of scoring in the advancing care information category. Providers who do use 2015 certified CEHRT, however, would be eligible to score bonus points. Given the dearth of available 2015 certified products, this change would be a relief to many MIPS-eligible practitioners, although practitioners would be well-advised to consider 2015 certified products as they become available.

The proposed rule would also offer a new hardship exemption in the advancing care information category for practitioners in small practices (those including 15 or fewer clinicians), which would allow these practitioners to weight the advancing care information technology category at zero percent of their final scores, and to shift those 25 percentage points to the quality category.

Bonus Point Opportunities. Under the proposed rule, small practices also continue to be eligible to receive three points for measures in the quality performance category that do not meet data completeness requirements; additionally, CMS would add five bonus points to the final scores of practitioners in small practices who submit data on at least one performance category. Also, up to three bonus points would be added to the final score of a practitioner who submitted data on at least one performance category and who treated complex patients, based on the average Hierarchical Condition Category (“HCC”) score of beneficiaries he or she cared for. CMS is seeking comments on whether the methodology for identifying practitioners who treat complex patients should be based on the proportion of dual eligible patients treated by a practitioner, instead of on average HCC score.

Facility-Based Practitioners. The proposed rule would also offer new flexibility in the way that facility-based practitioners are scored under MIPS. Practitioners whose primary professional responsibilities are in a healthcare facility would be allowed to submit that facility’s Hospital Value Based Purchasing Program scores as a proxy for the individual practitioner’s performance in the quality and cost categories.

Virtual Groups. For the first time in 2018, the proposed rule would also allow practitioners to form and report via “virtual groups”, made up of solo practitioners or physician groups of ten or fewer eligible clinicians. Practitioners in virtual groups would report and be scored at the group level across all MIPS categories. To be scored as a virtual group, participants would be required to submit a written agreement to CMS by December 1; practitioners interested in the virtual group option, therefore, should consider beginning planning now.

The Proposed Rule Would Change Little Regarding the Advanced APM Track

The proposed rule would leave in place the existing APM qualification criteria through performance years 2019 and 2020, requiring a revenue-based nominal amount standard of 8% of the estimated average total Medicare revenue of eligible clinicians.

The proposed rule does provide additional detail on the “All-Payer Combination Option” to be implemented in the 2019 performance year, which will allow clinicians to qualify as APM participants (and avoid MIPS participation) by combining both participation in Advanced APMs for Medicare patients as well as participation in other payors’ Advanced APMs.

CMS will accept comments on the proposed rule through August 21; a final rule is expected in the fall. The proposed rule’s flexibility and expanded exemptions will be welcome news to many practitioners. Overall, the proposed rule would exempt an estimated 134,000 additional practitioners from MIPS beyond the approximately 800,000 who were exempted in 2017, such that less than 40 percent of eligible practitioners would be expected to participate in MIPS in 2018, and even MIPS participants would have substantial flexibility in reporting and scoring. However, it is also clear that CMS under the new administration remains committed to payment reform and moving toward a full QPP implementation. Therefore, practitioners should continue to take measures to prepare for successful participation in either an advanced APM or across all four MIPS categories.

Recent Department of Justice Crackdown on Fraud and Abuse

As reported by the New York Times in an article dated July 13, 2017, in an effort to crack down on fraud and abuse, and with a particular focus on opioids, the Department of Justice (“DOJ”) is charging 412 individuals for collectively defrauding the government of around $1.3 billion. Of the individuals implicated, approximately one-third are being accused of opioid-related crimes. These crimes include billing Medicare and Medicaid for drugs that were never purchased, collecting money for fake treatments and tests, and exchanging prescription drugs for money. The fraud and abuse prosecutions are spread across more than 20 states, which include California, New York, Florida, and Texas. Continue Reading

Part VIII: BCRA – What Is Dead May Never Die

In Part VII of our blog series, Very Opaque to Slightly Transparent: Shedding Light on the Future of Healthcare, we described the Better Care Reconciliation Act of 2017 (“BCRA”), the Senate GOP’s latest Obamacare repeal and replace legislation. While the Senate GOP leadership had hoped to vote on this bill as soon as this week, the sudden announcement on July 17th by Senators Mike Lee (R-UT) and Jerry Moran (R-KS) of their opposition to BCRA has effectively killed the legislation as written. With Senators Susan Collins (R-ME) and Rand Paul (R-KY) having previously voiced their refusal to support BCRA, the bill simply lacks sufficient votes to pass or even be voted on by the full Senate. In response to this development, Senate Majority Leader Mitch McConnell issued the following statement: Continue Reading

More Telemedicine Food for Thought: Exception Five to the Haight Act’s In-Person Examination Requirement

In our July 10, 2017 post regarding telemedicine prescribing, we wrote about the seven exceptions to the Haight Act’s requirement that a provider and patient have an-person visit before a prescriber/practitioner can prescribe a controlled substance for his/her patient. As we concluded in the post, the current exceptions are so narrowly focused that they are of limited utility to telemedicine providers and practitioners. Continue Reading

Giving Telemedicine More Room to Breathe: Recent and Pending State and Federal Actions in the World of Online Prescribing

On October 18, 2008, the Ryan Haight Online Pharmacy Consumer Protection Act of 2008 (the “Haight Act”) came into law as the federal government’s first attempt to address the public health risks associated with online pharmacies – such risks including the dispensing of drugs (including addictive drugs to be used recreationally) without a valid prescription, and the dispensing of adulterated drugs, counterfeit drugs, and/or expired drugs, all of which could result in significant harm to individuals who may have been looking for an easy way to obtain prescribed medications at a lower price. Continue Reading

Part VII: The Senate’s Response to the American Health Care Act

Caveat: As of the date of this writing, there are indications that revisions to the Better Care Reconciliation Act of 2017 (“BCRA”) are in the works and may be issued as soon as Friday, June 30, 2017. If a revised BCRA is issued, there will be a new CBO report generated with respect to the revised bill. We will continue to watch the progress of the BCRA and, as a result, we will post to this blog additional blog posts regarding BCRA revisions, if any, and the BCRA’s advancement through the Senate, if any.

In Part VI of our blog series, Very Opaque to Slightly Transparent: Shedding Light on the Future of Healthcare, we outlined the “Macarthur Amendment” to the American Health Care Act (“AHCA”), which led to the bill’s narrow passage in the House on May 4, 2017. Almost 50 days later, on June 22, 2017, Senate Majority Leader Mitch McConnell released a “discussion draft” of the Senate’s response: the BCRA. While in large part similar to its House counterpart, there are some important changes, outlined below. Continue Reading

Exclusive Agreement Between Hospital and Insurance Plan Does Not Violate Section 1

The Seventh Circuit refused to revive an exclusive dealing claim by one hospital against its competitor because of an exclusivity agreement with an insurance plan. Judge Richard Posner wrote the short opinion strongly reiterating in the health insurance context the established principle that a competitor trying to attack vertical agreements under Section 1 of the Sherman Act will have an uphill struggle under the Rule of Reason. The case is Methodist Health Services Corp. v. OSF Healthcare System d/b/a Saint Francis Medical Center, No. 16-3791 (7th Cir. June 19, 2017). Continue Reading

When your Hospital-of-Choice is In-Network but, SURPRISE, your Anesthesiologist is Not: California’s AB-72 and Other State Responses to the Surprise Billing Pandemic

Regardless of a patient’s diligence in selecting an in-network hospital, ambulatory surgery center, or other health facility for treatment, patients are still being saddled with surprisingly high medical bills that include out-of-network rates which often dwarf the discounted in-network rates. These “Surprise Bills” occur when a patient receives treatment from an in-network facility but also receives treatment from an out-of-network physician (or other healthcare practitioner)[1] who provides services to in-network facility patients – consider an out-of-network anesthesiology group that is the exclusive physician of anesthesia services at an in-network hospital. Studies show that this and other similar scenarios are frequently played out across the Country. Continue Reading

The Enforcement Risks for Medicare Advantage Plans Continue: A New False Claims Act Settlement in Florida

Recent activities of the Department of Justice (“DOJ”) and Qui Tam whistleblowers reveal that Medicare Advantage Plans remain at the forefront of investigations for violations of the federal False Claim Act (“FCA”) for allegedly engaging in improper risk adjustment practices and other improper or fraudulent practices. In addition to the pending FCA enforcement cases in the Swoben and Poehling cases, as well as reports of ongoing federal investigations, the recent federal settlement in May in Florida with Freedom Health, Inc., and Optimum HealthCare, Inc. – both Medicare Advantage-participating managed care plans that are subsidiaries of America’s 1st Choice Holdings of Florida, LLC – demonstrates that the DOJ, the Office of the Inspector General of the United States Department of Health and Human Services (“OIG”) and Qui Tam whistleblowers are not only interested in large players, such as UnitedHealth Group and others, but also in smaller and regional Medicare Advantage organizations. Continue Reading

To Report or Not to Report – Is it Really A Question?

In a May 15, 2017 Bankruptcy Court decision (Gardens Decision) from California’s Central District (In re Gardens Regional Hospital and Medical Center, Inc. (Bankr. C.D.Cal., May 15, 2017, No. 1617463), Judge Ernest M. Robles wrote that the grant of oversight and approval authority given to California’s Attorney General over buy/sell and change-in-control transactions between nonprofit sellers of health facilities and for-profit buyers of health facilities (see, California Corporation Code Section 5914 (Section 5914)) is limited to those situations in which a nonprofit seller has an active California health facility license at the time of closing. As written by Judge Robles, the Gardens Decision concludes that transactions between nonprofit sellers and for-profit buyers fall outside the scope of Section 5914 if the assets at hand do not include an operating, California-licensed health facility. As a nonoperational, unlicensed health facility, the transaction at issue is not a health facility transaction subject to Section 5914 and, in turn, Attorney General oversight and approval. Continue Reading

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