Posted January 12, 2017 by Adele Allison
As the healthcare system moves away from fee-for-service payments toward value-based payment (VBP) and greater risk-bearing contracts, few providers are ready. A Deloitte 2016 survey reveals that half of physicians have not heard of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), including physicians with a high share of Medicare patients.1 The Department of Health and Human Services has aggressive plans to move traditional Medicare into models of value-based payment, setting a goal to tie 90% of Medicare payments to quality or value by the end of 2018.2 MACRA legislates this move toward value-based care and payment.
VBP is a new method of healthcare reimbursement that intertwines measured quality and efficiency to determine reimbursement. VBP typically employs reward and penalty techniques shifting revenue away from historic volume-based payment approaches. Quality measurement is crucial to VBP design, as is prevention, intervention, and member experience.
Forbes recently reported that Aetna, Anthem, Cigna, Blue Cross and Blue Shield, and UnitedHealthcare plans are paying medical providers for value-based care.3 Recently, UnitedHealthcare announced its doctors earned more than $148 million in quality of care bonus payments last year for Medicare Advantage members.4 While payers have already begun providing payments to providers to reward quality, MACRA is designed to accelerate further change in Medicare and expedite this transition toward VBP. Providers will be paid under one of two payment tracks: 1 – merit-based incentive payment system (MIPS); or, 2 – advanced alternative payment model (APM). An estimated 90% of providers will be reimbursed under MIPS.5
The first MIPS proposed performance reporting period begins January 1, 2017 with payment adjustments following in 2019. Only qualified participants in advanced APMs will avoid MIPS-oriented payments. Medicare payment reform will lead to payment and delivery redesign among other payers and markets, necessitating new practice management approaches.
This is an opportune time for payers to begin collaborating more fully with providers and overcome the payer-versus-provider mindset. Payers can play a key role in this transition by helping providers build quality measurement competencies and a value-based care infrastructure. While clinicians provide the direct patient care, payers can share with them aggregated population health data, data on individual member care gaps, and analytics to assist with care management strategies.
Other blog posts in this series:
If you are interested in learning more about how DST can help you navigate through this changing environment, please contact us at 800.272.4799.
1 Deloitte. MACRA: Disrupting the Health Care System at Every Level. http://www2.deloitte.com/us/en/pages/life-sciences-and-health-care/articles/macra.html. Published July 13, 2016. Accessed August 4, 2016.
2 CMS. Better Care. Smarter Spending. Healthier People: Paying Providers for Value, Not Volume. https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-01-26-3.html. Published January 26, 2015. Accessed August 4, 2016.
3 Forbes. UnitedHealth Pays $148M in Bonuses As Value-Based Care Tightens Grip. http://www.forbes.com/sites/brucejapsen/2016/08/04/unitedhealth-group-pays-148m-in-value-based-doctor-bonuses/#440f11810c79. Published August 4, 2016. Accessed August 8, 2016.
4 UnitedHealthcare. Doctors Earn More Than $148 Million in Quality of Care Bonus Payments for Improving Health Outcomes, Addressing Care Opportunities for UnitedHealthcare Medicare Advantage Members. Published August 4, 2016.
5 Modern Healthcare. Few docs ready for risk under MACRA. http://www.modernhealthcare.com/article/20160813/MAGAZINE/308139982. Published August 13, 2016. Accessed August 15, 2016.
The views expressed in this publication are solely those of the author and do not necessarily reflect the position or policy of DST Systems, Inc. or its affiliates, subsidiaries, joint ventures, officers, directors, or management.