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CMS Finalizes CY 2018 Updates to Quality Payment Program

The Centers for Medicare & Medicaid Services (CMS) released its final rule with comment period for calendar year (CY) 2018 updates to the Quality Payment Program (QPP), the physician payment system required by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

The QPP combines and replaces three separate clinician quality programs with a single system for clinicians that bill Medicare Part B. Under the program, eligible clinicians participate in one of two tracks: the default merit-based incentive payment system (MIPS) or Advanced Alternative Payment Models (APMs). The QPP’s first performance period — the “transition year” of the QPP — began on Jan. 1 and ends on Dec. 31. The first payment adjustments based on performance start Jan. 1, 2019.

For year two, beginning Jan. 1, 2018, CMS finalized provisions that build on transition year policies and introduced new policies allowing clinicians to choose how to participate in either the MIPS or Advanced APM tracks, based on their practice size, specialty, location, or patient population. Payment adjustments based on year two performance start Jan. 1, 2020.

CMS finalized the following MIPS-related provisions:

  • raising the performance threshold to 15 points in year two (from three points in the transition year);
  • applying a complex patients bonus capped at 5 bonus points (increased from 3 points as proposed) to the MIPS scoring methodology for clinicians caring for these patients;
  • offering a virtual groups participation option for MIPS-eligible clinicians;
  • increasing the low-volume threshold to allow more small practices to be exempt from MIPS;
  • allowing flexibility in MIPS measure submission mechanisms for the 2019 performance period;
  • updating weights for the four performance categories (quality, cost, improvement activities, and advancing care information);
  • providing a facility-based measurement option (based on the Hospital Value-Based Purchasing Program), in year three rather than year two as proposed, for clinicians who provide at least 75 percent of covered services in the inpatient hospital setting or emergency department; and
  • providing relief for physicians and practices affected by hurricanes Harvey, Irma and Maria, by issuing an interim final rule to exempt clinicians automatically — without submitting an application — from the quality, cost and improvement activity categories in 2017 if they were impacted.

The rule also finalized provisions related to APMs:

  • providing additional details about future implementation in performance year 2019 of the All-Payer Combination Model, as well as the Other Payer Advanced APM option;
  • offering additional information on MIPS APMs, including how more Medicare Shared Savings Program clinicians can qualify as MIPS APMs; and
  • maintaining the revenue-based nominal amount standard for Advanced APMs — i.e., 8 percent of physician revenue has to be at risk to qualify — through the 2020 performance year.

The provisions of the final rule with comment and interim final rule with comment are effective Jan. 1, 2018. CMS will accept comments until Jan. 1, 2018.

America’s Essential Hospitals will provide a more detailed summary to members in the coming days. Contact Director of Policy Erin O’Malley at or ‪202.585.0127‬ with questions.


About the Author

Maryellen Guinan is a principal policy analyst at America's Essential Hospitals.

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