12 MACRA Definitions You Need To Know

MACRA’s lexicon is vast, and it’s easy to get overwhelmed by the myriad of terms and acronyms associated with the new law. Here are a dozen definitions that will help acclimate MACRA newcomers.

  1. Medicare Access and CHIP Reauthorization Act (MACRA)

Signed into law in 2015 and fleshed out by the U.S. Centers for Medicare and Medicaid Services (CMS) in spring 2016, MACRA aims to create a value-based model for how physicians and other health care providers are paid for the clinical services they provide to Medicare patients. It replaces the unpopular Sustainable Growth Rate (SGR) payment structure with a system that rewards value-based care. It also consolidates existing reimbursement programs into one streamlined structure. CMS expects to implement MACRA’s components over the next several years.

  1. Medicare Sustainable Growth Rate (SGR)

Created in 1997, the SGR attempted to control Medicare spending. Under the law, the annual increase in per capita Medicare beneficiary spending could not exceed gross domestic product (GDP) growth. Medicare reimbursement rates (physician fee schedule) would decrease if expenditures for the previously year exceeded target expenditures; conversely, payments would increase if expenditures fell short of target expenditures. Expenditures consistently exceeded annual targets, leaving physicians vulnerable to steep payment cuts. Congress regularly approved “doc fixes” to avert the cuts. For example, physicians would have faced a 21 percent across-the-board payment cut in 2015 had Congress not intervened.

  1. Quality Payment Program (QPP)

Part of a broader push toward payment and quality, the QPP will replace the outdated patchwork of Medicare reimbursement programs. Its dual-path system includes the Merit-Based Incentive Payment System (MIPS) and the Advanced Alternative Payment Models (APMs). The programs focus on the value of care provided, not the volume.

  1. Merit-Based Incentive Payment System (MIPS)

MIPS consolidates parts of the Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM), and the Medicare Electronic Health Record Incentive Program for Eligible Professionals (meaningful use). It does not apply to hospitals or facilities. MIPS lets clinicians demonstrate performance by choosing the activities and measures that are most meaningful to their practice.

  1. Advanced Alternative Payment Models (APMs)

As an alternative to MIPS, APMs develop new ways for CMS to pay clinicians for the care they deliver. For example:

  • From 2019-2024, clinicians can receive a lump sum incentive payment.
  • There is increased transparency of clinician-focused payment models.
  • Starting in 2026, some clinicians will be able to receive higher annual payments.
  • Accountable care organizations and patient-centered medical homes (PCHMs) are APM examples.
  1. Eligible Clinicians
    Health care providers that are eligible to receive MIPS reimbursements. For 2019 and 2020, EPs will include:
  • Physicians
  • Physician assistants
  • Certified registered nurse anesthetists
  • Nurse practitioners
  • Clinical nurse specialists
  • Groups that include such professionals

Beginning in 2021, HHS will be able to add other clinicians, such as physical or occupational therapists, clinical social workers and nurse midwives.

  1. Quality Measurement Development Plan (MDP)

A strategic framework for clinician quality measurement to support MIPS and APMs.

  1. Quality Performance

MIPS performance category in which clinicians will be able to choose the quality measures on which they’ll be evaluated. Six measures will be included, including: 1 cost-cutting measure and 1 outcomes measure. Clinicians may select from individual measures or from a specialty measure set. There will be an emphasis on outcomes measurement.

  1. Advancing Care Information
    MIPS performance category that considers whether providers meaningfully use certified electronic health record (EHR) technology. CMS is folding the existing meaningful use program into MACRA.
  1. Resource Use
    MIPS performance category that compares the resources providers use to treat similar care episodes and clinical condition groups across practices.
  1. Clinical Practice Improvement Activities (CPIA)

MIPS performance category that focuses on whether an activity improves clinical practice or care delivery and is likely to result in improved care outcomes.

  1. Composite Performance Score (CPS):

Four categories are used to determine the MIPS CPS: Quality, Resource Use, Advancing Care Information and CQIA. Scores are allocated on a weighted 0-100 point scale:

Quality Performance: 50 percent

Advancing Care Information: 25 percent

CPIA: 15 percent

Resource Use: 10 percent

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