A Simple MACRA Overview

There is a lot of murmurs about what is coming with the new changes in healthcare. Signed into law in 2015, MACRA or the Medicare Access and CHIP Reauthorization Act looks to overhaul the old way of doing healthcare business and move it to a more accountable way of handling treatment and care of patients. But, with all things government related, there is a lot of ambiguity and uncertainty related to regulations, so we’ll take the time to do a MACRA overview so as to dispel some of the obscurity that exists. As with anything on the Internet, be sure to do your own homework and become fully educated in all regulations and expectations before making decisions about where your healthcare organization is heading.

The simplest reasons for the transformation to the way healthcare looks is twofold:

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  • Take control over the rising cost of healthcare
  • Provide better care for better outcomes to all patients

MACRA has two programs in which healthcare organizations can participate. The default and most popular program is MIPS (Merit-based Incentive Payment System) or the APM (Alternative Payment Models). Both programs look to incentivize hospitals and facilities to follow the twofold objective listed above when it comes to payments and reimbursement from CMS (the Centers for Medicare and Medicaid Services) department. There is also a risk of being penalized for not meeting standards; the percentage of repayment would be lowered for organizations that fail to cut costs or have problematic results such as readmission occurrences or low patient satisfaction scores.

MIPS Overview

With the best of intentions, many organizational and healthcare leaders created different measuring and improvement criterion hoping to help the industry as a whole. It takes the current systems of quality improvements and reporting and merges them into one program, and then begins to measure their results, such as patient satisfaction and readmissions, and cost cutting methods to gauge what sort of percentage increase or decrease will happen to reimbursements from CMS.

A score will be given to the healthcare organization based on quality not quantity of work, use of electronic health record technology, improvement to clinical practices and resource allocations. What this is all meant to do is to streamline the process of reporting, give patients an understanding of the work facilities are performing, and get spending under control. There is and will be a lot of work and preparations that will need to go into meeting the new standards and performing better as an organization, but it will all be worth it as headway is made and changes are implemented over time.

APM Overview

The Advanced Payment Method builds on to the fundamentals of MIPS and adds an element of financial risk. Running off the theory that healthcare organizations shouldn’t have too much inventory and too many procedures, but they don’t want too few, either. They must plan and execute goals to fit perfectly with the needs of the communities they serve. If they do not meet set goals or standards, they could be penalized in the percentage reimbursements from CMS. These penalties could be a reduction in the percent all the way down to actually owing CMS a certain amount.

Because this program is a less defined in its scope and details, there is more information that will need to be provided before its full implementation on January 1st, 2019. Part of the data CMS needs in order to clarify and quantify risks and assessments will come after organizations turn their data in at the end of 2017. But what is clear is the fact that APM helps to promote more technology use from the healthcare staff, more technology promotion and usage by patients and better delivery of care with data-driven decisions powering healthcare outcomes.

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Like anything significant coming down from the government, this MACRA overview is too simplistic to base significant changes off of; there are elements that are full of regulations that cannot even begin to be addressed here. Healthcare organizations need to prepare and understand what is going to be expected of them, and what risks are involved if they aren’t able to or refuse to be involved. Part of the reason that this is so significant is not just the amount of money that could be effected with reimbursements from Medicare, but because private healthcare insurance companies are watching careful as to how this all plays out. They could very well decide down the road to implement the same sort of standards that CMS is mandating, and couple it with their own reimbursement risk assessment.