MIPS / MACRA CMS Proposed Rule

May 23, 2016

The following memo summarizes and analyzes provisions of Merit-Based Incentive Payment System (MIPS) in the so called “MACRA” CMS proposed rule.

We would note that for the sake of brevity, we could not dig into the technical details on everything. Instead we have tried to pull out the most significant aspects for purposes of our discussion. However, we have included links throughout this summary for those who wish to dive into the details.

Who will participate in MIPS? 

Those clinicians affected by this rule are called “MIPS eligible clinicians” and for years 1 and 2 of MIPS will include: physicians, PAs, NPs, Clinical Nurse Specialists and Certified Registered Nurse Anesthetists. The Secretary may broaden this group after year 3 to include other health professionals (i.e. PTs, OTs, etc.). CMS anticipates that most clinicians will be subject to MIPS (as opposed to APMs or being exempt) especially for year 1.

CMS estimates that between 687,000 and 746,000 eligible professionals will be subject to MIPS in 2019.  CMS also estimates that somewhere between 30,658 and 90,000 eligible clinicians will be exempt from MIPS because of their participation in APMs or due to a “low volume” exemption.

How can clinicians participate? 

Clinicians can participate as either an individual or as a group as defined by a taxpayer identification number. Depending on how you are participating, you will have slightly different reporting mechanisms/requirements.

How does MIPS score work? – Overview 

Each clinician or group would receive a score from 0-100 in each of the following 4 weighted categories (percentage is year 1 weight):

-Quality (50%)
-Resource Use (10%)
-Clinical Performance Improvement Activities (15%)
-Advancing Care Information Performance (25%)

Those scores would then translate into something called MIPS Composite Performance Score or CPS. Payment adjustments will be determined off of the CPS. Over time, the percentage for Quality will phase down to 30% of the total and the percentage for Resource Use (Cost) will rise to 30%.  The Clinical Performance Improvement Activities (CPIA) and the Advancing Care Information Performance (ACIP) will remain unchanged.

Quality performance category overview (50% of CPS) 

MIPS eligible clinicians would report at least six measures of their choosing. The measures must including one so-called “cross cutting” measure and at least one “outcome” measure. If there is no applicable “outcome” measure, then clinicians must use one “high priority” measure. MIPS eligible clinicians can select any applicable measure of the over 300 measures in total.

Additionally, all MIPS eligible clinicians will be scored on 3 “population-based” measures. These are: 1-Acute Conditions Composite, 2-Chronic Conditions Composite, and 3-the All-cause Hospital Readmission Measure.

So what exactly are these measures the clinicians choose from?

There is no easy way to look at these because CMS has released the measures in a “table” format that is not easily portrayed in a word document. The full list of measures can be found in the Appendix of the NPRM document. 

Table A – list of all measures to choose from – begins on page 773
Table B – population based measures that all MIPS eligible clinicians will be measured on-begins on pg 823
Table C – list of cross cutting measures – also begins on page 823
Table D – proposed new measures – begins on page 825
Table E – list of measures broken out by specialty – begins on page 836 

How do these measures affect the MIPS quality score?

Each measure a clinician reports will be given a score of 1-10. For example an orthopedic surgeon who has selected his/her 6 measures (including 1 cross-cutting and 1 high priority), would be scored on a scale of 1-10 for each of the 6 measures. Additionally, the clinician would be measured on their 3 population based measures via a 1-10 scale.

So in total we have 9 measure with a max possible score of 90. If the physician scores a 70/90 then they would receive a 78% on the quality portion of the CPS. There are, of course, caveats to all of this. For instance, MIPS eligible clinicians participating via a group have to report more measures (up to 17), certain specialties that don’t have 6 applicable measures can report less, etc. There are also bonus points awarded for various activities and measures.

On each measure, CMS will create what they call a measure benchmark.  Essentially, a measure benchmark will be based on previous reported scores for that measure. Although not exactly an average, it will be a score that is representative of where a significant percentage of clinicians scored previously on that measure.  The clinicians will then be given points based on how they do against their peers. If you rank in the 55% percentile according to their benchmark, for example, then you will get roughly 5.5/10. The following Table demonstrates how the scoring for a particular quality measure would look:

Furthermore, CMS is aware that many of their measures are easier to achieve than others. CMS wants to discourage clinicians from picking the “low hanging fruit” and constantly strive for improvement.  Therefore, CMS penalize clinicians for picking the so-called “easy” measures.  CMS does this by creating something called a “topped out measure” which is essentially a measure where a large percentage of clinicians reported a 100 performance rate. In those cases they have developed a formula to make it impossible to get the full 10 points for that measure. Essentially they want to encourage clinicians to report the measures that may not be topped out. Table 18 gives you an idea of how these topped out measures would work:

We should note that CMS would like to measure and reward improvement but is soliciting comments on how best to implement this concept. They have laid out 3 options beginning on page 324 if you would like to further examine.

Resource Use performance category overview (10% of CPS) 

All measures used under the resource use performance category are derived from Medicare administrative claims data so there is no need to use another data submission mechanism. Furthermore, all measures attributed to the MIPS eligible clinician will be scored. If an eligible clinician has only one resource use measure with a required case minimum to be scored, CMS would score that measure accordingly.  The resource use performance category borrows most of the measures from the existing CMS value modifier (VM) program including:

-Total per capita cost measure
-The MSPB measure
-Episode based measures

These measures will have risk adjustment as previously adopted under the VM. These will basically adjust the expected cost of each beneficiary based on the Hierarchical Condition Category model. Here is a refresher on how that works. 

How does the Resource Use scoring work?

The Resource Use scoring works very similar to the existing CMS resource use scoring concept (QRUR).  Essentially, eligible clinicians get a score from 1-10 on each applicable measure based on a benchmark that puts all eligible clinicians on a bell curve. One of the key differences is that, CMS will use the performance year to determine the benchmark as opposed to the “baseline” year.

The higher the cost per each measure, the lower the score. Those “expensive” clinicians will receive a low category score. 

Clinical Performance Improvement Activities Performance Category Overview (15% of CPS) 

Think of the CPIA performance category like a checklist. If you did the improvement activity, you get the credit for that activity. In general, CMS expects the MIPS eligible clinician to perform the improvement activity for at least 90 days. This is strictly reporting.  No value or quality component to the activity.

Unlike quality and resource use, CPIA is a new program, and thus no baseline will be used for the first year. Instead each CPIA is assigned a “medium” weight worth 10 points, or a “high” weight worth 20 points. MIPS eligible clinicians will need to report 60 points worth of CPIA activities in order to receive a 100 on their CPIA scoring portion. For instance, an eligible clinician could report 6 medium weight activities, or 4 medium and 1 high weight activities in order to achieve 60 points total.

Unlike the measures in the quality and resource use programs, the CPIAs are activities where you either meet the criteria to say you did that activity or you didn’t. If you did the activity you will receive the full ten or twenty points. Table H on page 946 in the proposed rule lists all the CPIAs available for the first year.

Advancing Care Information Performance Category Overview (25% of CPS) 

The successor to Medicare EHR Incentive Program, the ACIP score is comprised of both a “base score” and a “performance score”.

The “base score” involves reporting the numerator and denominator of measures adopted by the EHR Incentive Programs Stage 3. The base score accounts for 50% of the ACIP. MIPS eligible clinicians must report the numerator and denominator or yes/no statements as appropriate for each measure within a subset of objectives. Similar to the CPIAs, if clinicians report the required items properly, they will get full credit.

The “performance score” consists of eight measures each worth 10 possible points. For instance, one of the measures asks clinicians to report the total number of prescriptions they write and the total number of prescription generated via a certified EHR. If a clinician gets submits 100% of their prescriptions via a certified EHR, their performance rate for this measure would be 100. Unlike the base score, the performance score is implemented off of a decile scale. So clinicians will be rated based off their percentile of performance, similar to the quality measures scoring system.

Each of the eight measures in the performance score is worth 10 points towards the full ACIP score (so up to 80%). The base score is then added with the performance score to determine the overall ACIP score. It is possible to get over 100 on the ACIP score, but those excellent performers would be capped at 100 for purposes of calculating their CPS. 

How the Overall CPS score is calculated – Overview 

So we have briefly described how the 4 inputs to the CPS score will work and be scored. The weights for each of the scores work logically as you might expect. So for demonstration purposes lets calculate a hypothetical CPS score.

CATEGORY                                                     SCORE     2019 WEIGHT    WEIGHTED SCORE
Quality Performance Category                    75              50                           37.5
Resource Use Performance Category        60              10                           6
Clinical Performance Improvement
Activities Performance Category                100            15                           15
Advanced Care Information
Performance Category                                  80             25                           20
Composite Performance Score CPS           N/A          N/A                        78.5

Incorporation of Risk Factors in the CPS score 

The proposed rule, for lack of a better term, largely “punts” on including risk factors in the overall CPS scoring methodology. While there is some risk adjustment (via HCC scores) in the resource use input category, there is as of right now, no other place where risk factors are seriously considered. The proposed rule does acknowledge that the law requires CMS to consider risk factors in their scoring methodology. They note that the ASPE is currently conducting studies and making recommendations “on the issue of risk adjustment for socioeconomic status on quality measures and resource use.” Then they state that they will “closely examine the recommendations issued by ASPE and incorporate them as feasible and appropriate through future rulemaking.”

MIPS Payment Adjustments 

Once everyone has their CPS score, CMS must then determine who gets the 4% upward adjustment, who gets the 4% downward adjustment, and who falls somewhere in the middle. To do this they are going to establish a “Performance Threshold” based on either the mean or median as selected by the Secretary of all the CPS scores.

CMS would then establish a linear scale by which the actual payments adjustment would be made. Of course, there are numerous caveats, but the general idea is that if your CPS score is above the performance threshold, you will receive an upwards adjustment. If your CPS score is below the performance threshold, you will receive some downward adjustment. CMS provides the following figure to help explain:

Nathan Baugh
(202) 544-1880


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