MACRA (Medicare Access and CHIP Reauthorization Act of 2015)

Contributor(s): Kristen Lee

MACRA (Medicare Access and CHIP Reauthorization Act of 2015) is U.S. healthcare legislation that provides a new framework for reimbursing clinicians who successfully demonstrate value over volume in patient care.

The CHIP in the full MACRA name stands for the Children's Health Insurance Program, for which MACRA extends funding.

The legislation went into effect April 16, 2015, with subsequent deadlines for various aspects of the law from the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS).

MACRA made three important changes to how Medicare pays providers.

  • The law repealed the Sustainable Growth Rate formula that determined Medicare payments for providers' services.
  • Participating providers are now paid based on the quality and effectiveness of care given.
  • MACRA combined existing quality reporting programs into one new system.

The Quality Payment Program

These changes included the creation of the Quality Payment Program (QPP), which helps the healthcare system move toward the goal of value-based care.

The QPP has two paths.

  1. Merit-based Incentive Payment System (MIPS): A program that measures eligible professionals on quality, resource use, clinical practice improvement and meaningful use of certified EHR technology.
  2. Alternative Payment Models (APMs): APMs create new ways for healthcare providers to get paid for the care they provide to Medicare beneficiaries. Some examples of APMs include accountable care organizations, patient-centered medical homes and bundled payment models.
What is MACRA?

Learn what MACRA is, its purpose, and how it will affect healthcare organizations.

Merit-based Incentive Payments (MIPS)

MIPS is the combination of parts of the Physicians Quality Reporting System (PQRS), the Value-based Payment Modifier (VBM), and the Medicare Electronic Health Record incentive program into one single program under MACRA.

For the first and second year of MIPS, only physicians, physician assistants, nurse practitioners, clinical nurse specialists and certified registered nurse anesthetists will participate in MIPS and qualify as eligible professionals.

From the third year on, physical or occupational therapists, speech-language pathologists, audiologists, nurse midwives, clinical social workers, clinical psychologists, and dietitians and nutritional professionals will also participate in MIPS.

MIPS determines Medicare payment adjustments using a composite performance score. Depending on this composite score, eligible professionals may receive a payment bonus, a payment penalty or may not receive a payment adjustment at all.

The composite -- or MIPS -- score measures eligible professionals based on four performance categories. These categories are all weighed differently.

  • 50% for quality (PQRS and VBM)
  • 25% for meaningful use
  • 15% for clinical practice improvement
  • 10% for resource use

How quality and effectiveness are determined

What are the quality improvement activities? How are quality and effectiveness determined?

Within MIPS is the Improvement Activities performance category, which assesses how much a healthcare organization or physician participates in activities that improve their clinical practice.

Those activities include:

  • Expanded practice access
  • Population health management
  • Care coordination
  • Beneficiary engagement
  • Patient safety and practice assessment
  • Participation in an alternative payment model
  • Achieving health equity
  • Integrating behavioral and mental health
  • Emergency preparedness and response

The EHR requirements

MACRA modifies, and perhaps will eventually replace the meaningful use stage 3 incentive program, as the law steers organizations toward using electronic health record (EHR) data for value-based care.

Under MACRA, if an EHR vendor would like their product to be considered a certified EHR, they must be able to do the following:

  • Indicate the data source for measures, activities and objectives under the Quality, Improvement Activities, and Advancing Care Information performance categories if the data is derived from a certified EHR technology.
  • Transmit data from the certified EHR technology or through a data intermediary in the form specified by CMS.
  • Allow individual MIPS-eligible clinicians and groups to submit data directly from their certified EHR technology in the form specified by CMS.

Effects on practices, hospitals and networks

Some research shows that MACRA could cause a significant hit to hospital revenues depending on the extent of physician participation in the Advanced APM track.

What is the timeline for MACRA implementation?

The timeline for MACRA is as follows:

  • November 2016: The final rules were published to implement certain requirements of MACRA.
  • By the end of 2016, Medicare Payments were tied to quality or value via alternative payment models.
  • By the end of 2016, Medicare fee-for-service payments were tied to quality or value.
  • By the end of 2018, 50% of Medicare payments will be tied to quality or value via alternative payment models.
  • By the end of 2018, 90% of Medicare fee-for-service payments will be tied to quality or value.
  • 2019: MIPS and APM payment provisions will go into effect.
This was last updated in August 2017

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