This Week – July 16, 2016

This Week in Washington, D.C.

  • North Carolina Legislature Passes Law Limiting MOC for State Licensing
  • MACRA Tidbit for the Week: What’s the relationship between the Annual Medicare Physician Fee Schedule Rule and MACRA?

From ACG Governor for North Carolina, Joseph W. Kittinger, III, MD, FACG

North Carolina Legislature Passes Law Limiting MOC for State Licensing

In early July, the North Carolina state legislature passed HB 728, which, among other provisions, states that the North Carolina Medical Board “shall not deny a licensee’s annual registration based solely on the licensee’s failure to become board certified.”  According to the North Carolina Medical Society, this limits the use of Maintenance of Certification as part of licensing decisions.  This is welcomed news for ACG members in NC.

In April, the state of Oklahoma passed legislation preventing MOC from being a conditional requirement for state license, hospital privileges, reimbursement, or employment.

ACG has joined other organizations in calling on the ABIM to do away with unnecessary and excessive lifelong testing requirements:

“We support the principles of lifelong learning as evidenced by ongoing CME activities, rather than lifelong testing.”

Follow ACG’s conversation on ABIM here.

ACG continues to advocate on your behalf at the state level through the ACG Board of Governors.  Fortunately, the unique function and structure of the ACG Board of Governors is a natural fit for these issues, allowing the College to be actively engaged at the state level.

ACG will continue to update members on this important issue.  Contact your ACG Governor to help get your state involved as well.

MACRAbanner

What’s the relationship between the Annual Medicare Physician Fee Schedule Rule and MACRA?

 
As you know, on July 7th, CMS released the proposed Medicare payment rates for CY 2017.   How does this annual physician fee schedule relate to the proposed MACRA rule?

Some Background:

Prior to MACRA, CMS made all policy changes and reimbursement rate revisions in the annual fee schedule rule.  The reimbursement portion of the rule sets forth the “relative value units (RVUs)” to help determine each code’s reimbursement rate.  The RVU is an estimate for physician work, practice expense, and medical malpractice relative to, or compared to, other physician services in Medicare.  CMS adds up the RVUs, and then multiples the sum by a “conversion factor” to ultimately calculate a reimbursement.  CMS also adjusts this “conversion factor” up or down depending upon Medicare budgetary mandates from Congress.  There are also geographic locality adjustments.

Basic Example:

National Avg. Medicare Payment:

(Work RVU+ Practice Expense RVU+ Malpractice RVU) x Conversion Factor = Payment Rate

2016 National Average Medicare Payment: 45378 (diagnostic colonoscopy /facility):

$199.79 = (3.36 + 1.74 +. 48) x 35.8043

So this is the starting point…

…Now enter MACRA 

MACRA now sets forth the process by which CMS will adjust these reimbursement rates up or down via your participation in MIPS or APMs, ultimately coming up with the actual final reimbursement for the year.

Example: 45378 under MIPS using 2016 reimbursement. To keep things simple, please also assume that the conversion factor is unchanged.  Some possible outcomes are demonstrated below:

  1. The provider participates in MIPS in 2017 and scores well in each of the MIPS categories. CMS determines that the provider is eligible for a 4% bonus payment for 2019:

$207.78 = (3.36 + 1.74 +. 48) x 35.8043 with 4% MIPS Bonus

  1. The provider participates in MIPS in 2017 and scores poorly in each of the MIPS categories. CMS determines that the provider is scheduled for a 4% payment cut in 2019:

$191.80 = (3.36 + 1.74 +. 48) x 35.8043 with 4% MIPS cut

  1. The provider participates in a MACRA-approved APM. CMS determines that the provider is scheduled for the 5% APM participation bonus in 2019.  However, the provider’s actual 2019 payment also depends on the collective performance of their APM group as well as the “risk arrangement” the APM has with CMS.  MACRA helps define these risk arrangements and total losses, which, as currently proposed, would be at least 4% of the target rate if you are in an ACO.  One possible scenario:

$201.39 = (3.36 + 1.74 + .48) x 35.8043 with 5% APM individual participation bonus, but then 4% cut due to the collective AMP’s poor performance.

Prior to the MACRA proposed rule, this annual fee schedule also contained everything: all the quality reporting changes associated with Medicare (PQRS, value-based payment modifier, etc.).  Now that MACRA is in the picture, CMS currently has two separate regulations out there running on parallel tracks (MACRA and annual fee schedule changes).

Both regulations will converge in January 2017, when everything is scheduled to begin.  However, CMS did publicly say this week that the Agency is open to a delay.  Stay tuned.