MIPS and VBP – “it was the best of times, it was the worst of times.”

November 2nd, 2016 by Rod Baird

Apologies for describing these two CMS programs by using the words of Charles Dickens – but they fit exactly.

The worst of times – Value Based Purchasing’s teeth bite into LTPAC Physician Groups’ 2017 and 2018 Medicare Pay Rates.

Two weeks ago the CMS began issuing 2015 QRURs (Quality and Resource Use Reports) to all medical groups submitting claims under Medicare Part B. These reports catalogue your performance on quality measures (e.g. PQRS), and resource use (average costs for a panel of Part B patients attributed to the group through a PCP relationship, or via inpatient hospital episodes).

The results were uniformly dismal, and confirmed something we’d predicted. Any LTPAC Medical Group that includes one or more Physicians as group members is going to receive a <2%> downward adjustment in 2017 Part B fees because they are classified as High Cost. That means the average cost of all their attributed patients was more than 1 standard deviation above the mean (e.g. benchmark value) for all PCP groups. Groups that failed to satisfy PQRS participation requirements incurred an additional <2%> downward adjustment – for a total cutback at the group level of <4%>.

Currently, we’ve reviewed QRURs from 10 different groups which served over a dozen geographically separated markets. One of the groups only employed Nurse Practitioners; the others mixed Physicians, NPs, and PAs.

  • Each of the physician led practices received the <2%> downward adjustment;
  • the NP led practice was exempt from the downward adjustment in 2017 even though their patients were classified as ‘high cost’.
    • That’s because groups comprised only of NPs were excluded from the possibility of a downward adjustment secondary to a high cost, or low quality status based on 2015 performance.
  • That exclusion for NP groups expired at the end of 2015 – which means both types of groups, Physician and NP led, are subject to the downward adjustment in 2018 Medicare Part B rates based on their 2016 Performance.
  • Remember, LTPAC Medical Groups cannot escape that downward Value Based Purchasing Payment Adjustment because the patients they capture via attribution during Skilled Nursing episodes of care (POS 31) are ‘high cost’. Every Medicare Patient admitted to a SNF Stay must have a preceding Acute Care Episode. 100% of those individuals bring with them the cost of that hospital episode, and also incur a SNF episode’s costs during their stay.
  • All five LTPAC Groups had Quality Scores that fell between -0.36 and +0.92; those scores are defined as ‘average’ performance, and no penalty or award payments are associated with the ‘average’ performance category.
  • So in summation – based on all information we have at hand, and a pattern of performance that is consistent for conscientious LTPAC groups over the period 2012-2015 – every physician led group will experience a <2%> downward adjustment in 2016 and 2017 Part B rates. NP led groups will suffer that same <2>% Resource Use downward adjustment for CY 2018.

All of those five groups successfully reported for PQRS for more than 50% of their patients, but none were able to completely execute a reporting strategy that satisfied the requirements for being ‘High Quality’. [promisingly, one group did reach a score of 0.92 which placed them in the upper quartile of all groups reporting – so it is possible for highly organized groups to report better than average quality].

It’s probably too late for groups to modify their 2016 PQRS reporting strategy in search of a Quality Score >1.0. However, for groups that have been working on that goal all year, we can confirm that the strategies GPM has discussed with Users over the past 12 months do work.

Our second November Blog post will focus on an initial review of the final MACRA/MIPS rule and its effect on LTPAC medical groups.

Rod Baird

About Rod Baird

Rod Baird is the Founder and President of Geriatric Practice Management (GPM). Since 1977, he’s led provider and management organizations that deliver care to Medicare/Medicaid beneficiaries. Past programs he’s overseen include home health, personal care, hospice, rehabilitation hospitals, adult and psych daycare, alcohol/drug rehabilitation, industrial medicine and primary care practices. The Centers for Medicare and Medicaid Services (CMS) selected Baird as one of only 73 individuals to serve with its InnovationProgram. His educational background includes a Master’s Degree in Physical Chemistry from the American University, Washington, D.C.

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