The Medicare Payment Advisory Commission (MedPAC) is set to include a formal recommendation to Congress to repeal and replace the Merit-based Incentive Payment System (MIPS) in one of its reports to Congress in 2018. Many MIPS-eligible clinicians (EC) are therefore wondering about the long-term prospects for the program. While MedPAC’s recommendations are influential, we believe it is unlikely that Congress will act to replace the MIPS program – at least for the next few years.
MedPAC gives two primary reasons for disliking MIPS: one, it does not meaningfully measure for quality, and two, it is overly burdensome on providers to the point where the administrative burden outweighs the potential savings of MIPS. Most ECs would likely agree with MedPAC’s assessment of the program.
MedPAC is recommending that Congress replaces MIPS with a new “Voluntary Value Program” (VVP) that would automatically withhold a percentage of every provider’s Medicare fee-for-service (FFS) payments each year. Providers would form reporting groups and be measured as a group on a small set of population health measures for which data would be automatically collected through claims. Providers could earn back their withheld amount and potentially earn a bonus payment based on their performance. Unlike MIPS, this program would not be budget neutral although it would be designed to be as close to budget neutral as possible.
MedPAC’s true goal of the move toward value-based FFS payments is to drive providers towards Advanced Alternative Payment Model (Advanced APM). The VVP is intended to be less-attractive than Advanced APMs which would have a higher potential for positive payment adjustments than the VVP. Providers who participate in Advanced APMs would earn back their withheld amount.
Almost every Commissioner supports the framework of the VVP although they acknowledge that many of the details for the VVP still need to be finalized. The Commission still needs to agree on which population health measures it will use, the criteria for forming a participation group, what percentage of FFS payments will be withheld, what are the potential positive payment adjustments beyond earning back the withheld amount under the VVP, will the measures be risk adjusted, etc.
Despite overwhelming support among the Commissioners, we do not think Congress will try to adopt this recommendation in the near-term. The law that created MIPS, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), was passed with significant bipartisan support which it still enjoys in Congress.
Some of the lawmakers who supported MACRA have taken issue with how the Centers for Medicare and Medicaid Services (CMS) has implemented certain parts of the statute but those are matters that can be fixed and do not require Congress to tear it down and start from scratch.
Congress is unlikely to make changes to MIPS unless they hear from a significant number of ECs who are facing negative payment adjustments. CMS is already shielding many ECs from negative payment adjustments through the low volume provider exemption threshold and by setting a relatively achievable benchmark MIPS Composite Performance Score (CPS) for both the 2017 and 2018 reporting years.
However, CMS will not have the same ability to use the benchmark CPS as a mechanism to protect providers from negative payment adjustments beyond 2018. For the 2019 reporting year/2021 payment year, the statute requires CMS to begin using either the mean or median CPS as the benchmark score. This will almost certainly be higher than the 2018 CPS of 15 points. Congress could make a statutory change to extend CMS’ authority to determine the benchmark CPS. If Congress does not make this change, CMS still has the ability to exempt many clinicians through the low volume provider threshold.
CMS is also beginning its new Meaningful Measures Initiative which is intended to reduce the burden of quality reporting and improve the meaningfulness of the measures that are reported. This Initiative was only announced on October 30th and many more details still need to be developed.
MedPAC submits two reports per year to Congress with recommendations that cover the entire Medicare program. These recommendations certainly carry weight but very few ever find their way into legislation that is passed by Congress. Between the support for MACRA in Congress and the fact that many clinicians are shielded from the negative payment adjustments, Congress is unlikely to act on MedPAC’s recommendations in 2018. However, if the benchmark CPS is changed to the mean or median CPS, that could lead to a significant increase in negative payment adjustments which could in turn lead to Congress taking action to fix MIPS or perhaps consider MedPAC’s proposed VVP.