Running head: VALUE-BASED PROGRAMS, MIPS, AND APM 1

Value Based Programs, MIPS, and APM

Name

Institutional Affiliation
VALUE-BASED PROGRAMS, MIPS, AND APM 2

Background

The United States healthcare system is currently undergoing significant transformation.

There is intense pressure from the government and policymakers to improve the quality of the

services while controlling the costs. The changes have driven a shift from the current volume

centered fee-for-service payment to value-based reimbursements. In 2015, the Medicare Access

CHIP Reauthorization Act (MACRA) was passed to law and requires all medical practitioners

who attend to 100 Medicare clients and bills Medicare for over $30,000 annually to take part in

Quality Payment Program (QPP) or incur express reimbursement charges. These value-based

payment systems are intended to align doctor reimbursements with the better value of care,

through improving quality and reducing the costs. Essentially, physicians from all fields have

been assigned a role to develop the proposal and give clarity of interpretation that optimizes the

value of care for all clients.

For many years, the US healthcare system has been characterized by the fee-for-service

system which encouraged healthcare providers to overspend, overtreat, or overprescribe.

Substantially, any practitioner who wanted to increase their income would increase the services

provided and the prescriptions. As a result, the healthcare system was economically

unsustainable and consequently, it increased the rate of inflation at the expense of quality of

services (Saleh & Shaffer, 2016). Nonetheless, in recent years, the implementation of the

Affordable Care Act and Patient Protection programs, the health care systems have changed,

mainly through value-based reimbursement. The program, which was enacted during the Obama

government to positively improve the outcome of patients and provide the service at affordable

cost.
VALUE-BASED PROGRAMS, MIPS, AND APM 3

However, with the implementation of Value-based system, the financial risk has been

transferred from the payer to various stakeholders such as insurers, integrated service providers,

accountable care firms, and consumers that acquired health policies with high deductibles. The

financial consequence of shifting to the value-based payment has most groups to seek ways to

optimize their services and improve quality and to avoid penalties or delayed reimbursements

(Clough & McClelan, 2016). Medical practitioners, including community health workers and

accountable care organizations (ACO), are pressured to improve all their resources because all

reimbursements are now based on the quality of their client’s health outcome. Therefore, value-

based programs encourage healthcare providers to foster behaviors and attitudes among the

clients to promote healthy lifestyles.

Remarkably, the change towards the value-based payment systems has been ensured in

multiple ways. According to Chee, et al. (2016), in 2015, the US government settled on tying the

85 percent of their traditional Medicare payments to care or quality of the patient and increase

the range to 90 percent by 2018. With the ratification of the MACRA, the government adjusted

the Sustainable Growth Rate Formula with broad bipartisan support, consequently commitment

to the value-based reimbursement systems. MACRA creates the MIPS and APMs which brings

the extant quality reporting systems at the same level, hence affecting EHR incentive systems,

Physician Quality Reporting Systems, and value-based payment modifier. While these programs

do not end under the new era, they have become the stepping stones for the formula for scoring

performance of eligible professionals in the new environments.

Merit-Based Incentive Payment Systems

Under MIPS, the current Medicare reporting systems are being integrated and integrated

into a single system. The consolidation of these systems significantly reduces the number of
VALUE-BASED PROGRAMS, MIPS, AND APM 4

financial chargebacks doctors would have encountered in the future, while also retaining a

greater chance of getting payment bonuses. The introduction of this program makes it possible

various aspects in Medicare, including cost, electronic health records, quality improvement to

adequately help the practitioners to practice more effectively and with lower costs. A significant

objective of the system is to do away with the threat of physicians undergoing double cuts every

year as they experienced with Sustainable Growth Rate which is currently being repealed.

Essentially, MIPS preserves the traditional fee-for-service reimbursement and adjusts the

provider payment by provider-specific composite score derived from four performance

categories according to the 2017 performance year and 2019 payment adjustment. The value-

based system is successfully integrated into the MIPS to ensure that quality and meaningful

services to the clients.

Establishment of the MIPS offers an opportunity to revise, rework, and improve the

existing Medicare systems concentrating on quality, cost, and the use of electronic health records

to enhance their relevance to real-world medical practice and sideline administrative costs of the

physicians. MIPS components include (Murphy, 2017):

Quality: This component replaces the Physician Quality Reporting System (PQRS) which is

currently in use.

Cost: Stands in the place of value-based modifier (VBM) system.

Advancing Care Information: Substitutes Meaningful Use (MU) program.

Improvement Activities: This is the newest component introduced issued for Medicare and

Medicaid programs.
VALUE-BASED PROGRAMS, MIPS, AND APM 5

Following the years of advocacy from AMA, the Centers for Medicare and Medicaid

Services (CMS) has eliminated the electronic physician order entry and clinical decision support

systems from the Medicare MU system and the ACI element of the Quality Payment Program

(QPP). Nonetheless, the Medicaid MU will include the electronic physician order entry and

clinical decision systems. Therefore, physicians will be required to work with various CDS

systems and starting from 2017; medical practitioners are required to create policies around

CPOE and CDS to blend with their work and improve the quality of care.

Alternative Payment Models

For the providers who choose to forgo MIPS, MACRA offers an alternative technique for

value-based care – Alternative Payment Models (APMS) which comprise the Medicare Shared

Savings Program and the like. These physician-focused payments are based on the feedback

from the industry parties and MedPAC among others. CMS describes APMs as payment

approaches created in alliance with the clinical community that offer incentives to clinicians to

provide high-quality and cost-efficient treatment. They comprise the accountable care

organizations (ACOs), bundled episode of care programs, patient-centered medical homes, and

other innovative healthcare providing organizations created to improve care coordination and

hospitals high-value care. According to Squitieri and Chung (2017), ACOs are a bundle of

healthcare organizations and healthcare providers, who work together voluntarily to provide

high-quality, coordinated care. Medicare has various ACO systems, only some of which qualify

as a high-level APM suitable for MIPS exclusion in 2017.

Besides getting reimbursement for offering professional services, APM partakers are also

eligible for incentive payment equivalent to five percent. Between 2019 and 2020, eligible APM

participants are medical practitioners that furnish 25 percent or more of their practices as a part
VALUE-BASED PROGRAMS, MIPS, AND APM 6

of the qualified alternative payment centers. The percentage is set to rise to 75 percent by 2023

(Murphy, 2016). However, the qualifying APM participants have to have qualities similar to

MIPS providers. First, they must be able to use certified EHR systems and base their provision of

professional services on quality metrics. Accordingly, the critical element of MACRA in respect

to APM is the adoption of Physician-centered payment model technical advisory committee

which is expected to advise HHS on its eponymous PFPMs.

Barriers to Implementation of MIPS and APM Programs

One of the significant challenges in implementing MPIS and APM systems is the process

of reconciling all the structures already in place and the new systems. Most contracts in the

Value-Based Payment systems are in the initial stages and thus, consolidating APM and MIPS

systems into one program might be mountainous for the implementers. Furthermore, the

providers need to have policies that can accurately and precisely measure track the various

quality measures needed in the programs. Thus, providers will be required to have access to

sophisticated analytics to aid in measuring financial as well as quality performance for all clients

(Brown, 2017). This will help the practitioners to enhance their performance once they identify

weaknesses in their systems.

Recommendations

Starting from 2019, all practitioners are required to choose either implementing MIPS or

APMs. The first recommendation is to ensure that all physicians are conversant with these

systems and the requirements for participation. It is early to advise the physicians on the system

to favor since the Medicare is finalizing the system in which the practitioners can apply for MIPS

or APMs. Thus, it is important to learn the existing Physical Quality Reporting System to get an
VALUE-BASED PROGRAMS, MIPS, AND APM 7

advantage. It is also of great significance if the physicians are conversant with Medicare value

modifier index and meaningful use. Moreover, I would also recommend the practitioners to get

certified for Patient-Centered Medical Home (PCMH). This is a medical modality that involves a

coordinated patient care system through their primary caregiver, ensuring that all clients get

services at required times. Additionally, it is imperative to involve all relevant stakeholders

during the decision-making of the system to implement in a specific practice. Various

stakeholders can give insights and thus, help the physicians make an informed decision on the

system to implement for the year.

Conclusion

In conclusion, it is apparent that value-based programs are helpful in reducing costs and

improving the quality of care given to the patients. Unlike the traditional fee-for-service

payments, value-based reimbursements are founded on the quality of life a client leads after

being attended to by a physician. This new system encourages the practitioners to work towards

an integrated approach and patient-based system of attending to the patients. Moreover, the new

system allows the practitioners to choose either PIMS or APMs for their reimbursements. Since

the system implementation is underway, it is recommended for the practices to acquaint

themselves with it and involve stakeholders before settling on a particular value-based program.
VALUE-BASED PROGRAMS, MIPS, AND APM 8

References

Chee, T. T., Ryan, A. M., Wasfy, J. H., & Borden, W. B. (2016). Current State of Value-Based

Purchasing Programs. Circulation, 133(22), 2197-205.

Clough, J. D., & McClelan, M. (2016). Implementing MACRA: Implications for Physicians and

Physician Leadership. JAMA, 315(22), 2397-2398.

Murphy, K. (2016). What We Know About Value-Based Care Under MACRA, MIPS, APMs.

Retrieved from Revcycle Intelligence: https://revcycleintelligence.com/features/what-we-

know-about-value-based-care-under-macra-mips-apms

Saleh, K. J., & Shaffer, W. O. (2016). Understanding Value-Based Reimbursement Models and

Trends in Orthopaedic Health Policy: An Introduction to the Medicare Access and CHIP

Reauthorization Act (MACRA) of 2015. J Am Acad Orthop Surg, e136-e147.

Squitieri, L., & Chung, K. C. (2017). Value-Based Payment Reform and the Medicare Access

and Children's Health Insurance Program Reauthorization Act of 2015: A Primer for

Plastic Surgeons. Plastic and Reconstructive Surgery, 140 (1), 205-214.