The move away from fee-for-service toward value-based medical care took a major step when the Centers for Medicare and Medicaid Services put forward its new proposed rule in late April.

In a commentary about the proposal in a recent JAMA issue, Dr. Jeffrey Clough of the Duke Clinical Research Institute and Dr. Mark McClellan, director of the Duke-Margolis Center for Health Policy, urged physicians to understand the changes — and opportunities — arising from the new payment scheme in the Medicare Access and CHIP Reauthorization Act (MACRA).

“Our aim in this commentary is to provide physicians with an overview of the options for participation in payment reform and quality improvement under MACRA. Their leadership is essential to the future of high-value health care,” Clough told Duke Today.

This new proposal from CMS has was officially published in early May in the Federal Register and is entitled "Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive Under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models."

Although the new proposal takes on the "historic and complex" task of changing the way health care billing is done, the Duke authors advise that it still needs vital input. "The rule leaves many questions unsettled, including certainty about the best pathways forward for many types of physicians, and how much influence the reforms will have on quality of care and spending for Medicare beneficiaries," they noted in their JAMA commentary.

The bottom line of the changes is summed up in the four Components of the Composite Performance Score of the Merit-Based Incentive Payment System

Quality (50% Decreasing to 30% in 2021)
• Physicians must report on at least 6 quality measures, including 1 outcome measure if available, from an annually updated inventory (example outcome measures include functional improvement following surgery and depression remission).

Resource Use (10% Increasing to 30% in 2021)
• These measures will be calculated by CMS using claims, including 2 general measures that assess the total cost of care for beneficiaries during a year or surrounding a hospitalization, as well as 40 clinical episode measures, as a basis for rewarding efficient physicians.

Advancing Care Information (25%)
• This category replaces meaningful use measures on health information technology with fewer and more flexible reporting requirements intended to promote interoperability and data flow relevant to a physician’s practice, rather than electronic health record capabilities per se.

Clinical Practice Improvement Activity (15%)
• Clinicians must attest to several of a wide range of practice-level activities, such as delivery of telehealth services, participation in registries, and provision of 24/7 access.

But the authors advised that these do not adequately measure "important aspects of quality," as well as not accounting for the severity of the health episodes.

"There is little evidence that pay-for-performance reduces overall costs," they stated, adding, "The resource use measures are scheduled to become more important, but measures to date have a poor track record in identifying efficient physicians and practices."

As an example they note that to date, similar measures in the 2016 Value-Based Payment Modifier program found that "96 percent of physician practices were scored as “average cost.” They suggested that "clinicians can generally expect average scores, which offer little motivation to change."

The proposal also describes "Alternative Payment Models (APMs) , which could allow health care providers to be exempted from MIPS – in return for assuming a greater degree of accountability for quality and costs.

“We estimate that about 10 percent of physicians could qualify for extra payments associated with advanced Alternative Payment Models based on the Medicare payment options and pilots available now. These would mainly include certain primary care doctors and clinicians practicing within large integrated systems that take on significant financial risk,” McClellan told Duke Today, stressing that "physicians have a real opportunity to shape the future of clinical practice, by developing models that enable a broader range of physicians to qualify for advanced APMs."

For Miranda Franco of the Holland & Knight law firm, these changes are "the strongest attempt by the CMS to get to risk-based APMs. The MACRA incentivizes physicians to move into Advanced or Other Payer Advanced APMs through several different mechanisms, including a guaranteed 5 percent bonus for six years and a permanent annual 0.75 percent fee schedule bump."

She stressed that "those in the health care industry should pay close attention to these incentives and to Medicare's evolving payment structures so they can position their organizations for success in the new value-based world."