Medicare Reform

Overview of MACRA

Congress passed the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which permanently eliminates the sustainable growth rate (SGR) formula and its annual threat of physician payment cuts. The proposed rule establishes a new Quality Payment Program (QPP), with two pathways including Merit-Based Incentive Payment System (MIPS) and Alternative Payment Models (APMs). Through the MIPS pathway, MACRA retains a modified fee-for-service model and consolidates former reporting programs, including Physician Quality Reporting System, Value-Based Modifier, and Meaningful Use. MIPS components include quality, resource use, meaningful use of certified EHR technology, and clinical practice improvement activities. These components will help increase clinician flexibility by allowing physicians more choice in the measures and activities on which they report, based on what is relevant to their practice. Through MIPS, the Centers for Medicaid and Medicare Services compares each group or individual physician’s composite performance score to an annual performance threshold based the average of the prior year and gives adjustments in the form of bonuses, penalties, or no adjustment if at the threshold. The maximum positive or negative adjustment will begin at 4% in 2019 and increase to 9% by 2022, where it will remain thereafter.

Physicians can also choose to adopt new payment and delivery models under eligible APMs and are then exempt from participating in MIPS if they meet certain threshold levels, based on percentage of patients in the APMs. Qualifying APM participants will receive a 5% lump sum bonus from 2019-2024, with higher fee schedule updates beginning in 2026. Participation in APMs below the threshold levels will still allow physicians to improve their MIPS scores. There are various APMs designed to help physicians in every specialty qualify for MACRA thresholds, while promoting increased value and quality of care and lowering costs. There are efforts by specialty societies to develop additional APMs to match the needs of all specialties. To be successful, an APM must offer flexibility in care delivery, adequacy and predictability of payment, and accountability for costs and quality that physicians can control.

There are concerns that clinicians in small practices will incur a penalty under this new system, but the OSMA is here to help you avoid any adverse outcomes, understand the new system, and ultimately create a positive change within your practice under MACRA. The Centers for Medicare and Medicaid Services has been receptive to feedback and the OSMA, along with other organized medicine entities, are working to submit comments to help provide further relief and assistance to small practices and overall refine the proposed rule. While this will be an adjustment for many practices, MACRA is poised to drive healthcare delivery and payment reform from fee-for-service to pay-for-value, as well as reducing burdens on physicians and improving patient care.


>> Find an OSMA Payer Update Session near you!
>> View OSMA's MACRA Webinar (20 minutes)
>> Why MACRA matters for your practice

>> Flexibilities and support for small practices
>> Understanding MACRA
Quality Payment Program Fact Sheet
Upcoming Webinars about the MACRA proposed rule
>> MACRA Timeline
>> Get a MACRA readiness assessment for your practice


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