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.