Resource Use: The Murky Waters of MIPS

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Sea change aheadHonestly, I was not going to do this to you. With the exception of Dugan Maddux’s recent post, the Acumen blog has been drowning in the ocean of MACRA for what seems like months now. But given that this is indeed a sea change (sorry) with respect to physician payment, and the fact that Diana Strubler threw down the gauntlet last week (with only one component of MIPS left on the table), why not take the plunge? So, if you are tired of the MACRA/MIPS alphabet soup of late, skip this post and return to the blog next week. Because this week, we are going to dip our toe into what I find to be the most confusing component of MIPS—Resource Use.

What’s old is new

Resource Use is small potatoes in year 1, accounting for a paltry 10% of your MIPS score in payment year 2019. But do not let this modest start fool you. As the MIPS program matures, in 2021 and beyond, the Resource Use category will account for 30% of your score. In those years, Quality and Resource Use will stand on equal footing and together account for 60% of your MIPS performance score.

One of the lessons learned over the years is CMS typically does not reinvent the wheel. In many respects, that’s proven to be the case with MIPS. With the exception of the Clinical Practice Improvement Activity measure, which Diana reviewed last month, the programs that make up MIPS have been recycled. Our challenge today is to unpack what CMS has scavenged from the physician value-based payment modifier (VM) and understand how it’s going to work with MIPS.

Hard to hit what you can’t see

One of the good things about the Resource Use component of MIPS is you do not have to report anything to CMS; it’s all harvested from Medicare administrative claims data, so technically there’s zero administrative burden for you and your practice. One of the bad things about the Resource Use component of MIPS is you do not have to report anything; it’s all harvested from Medicare administrative claims data, and therein lies part of the problem with the VM and its intersection with MIPS. If you objectively look at the existing programs—MU, PQRS, and the VM, the programs CMS used to build MIPS—the VM is very clearly the most difficult to understand and the least transparent. In my view this also makes it the most difficult part of the program for you and your practice to impact.

The VM revisited

We’ve reviewed the VM in detail before in this blog. There are several reasons the VM is so difficult to understand and why the framework makes most of it a bit obscure. As you may recall, the VM has basically two arms, a quality arm and a cost or “resource use” arm. We are going to ignore the quality side of the VM today, although buried in the body that 962-page sea monster we know as the proposed rule is the fact that several components of the quality side of MIPS will now be part of your MIPS quality score, but I digress. On the cost side, the VM is looking exclusively at hospitalization costs. Today, it scores 6 measures of “resource use.” One of those is episode-based, the remaining 5 are measures of total per-capita cost.

On the episode-based side of the house, the VM scores what’s referred to as Medicare Spending per Beneficiary (MSPB). This clever 4-letter acronym refers to the combined Part A & B spend for hospitalized patients. There are 2 things you should know about MSPB. First, the spend they are looking at is the combined Part A & B spend incurred by the patient during a time interval that starts 3 days prior to admission and ends 30 days post-discharge (that’s typically a lot of money). Second, the MSPB is attributed to the practice that delivers the plurality of Part B services during the hospital stay. The thinking here is that if you or your group spend more time with the patient while they are in the hospital, you should be on the hook for cost of care during that “episode.” Makes perfect sense, right?

The other 5 measures in the VM today examine global per capita costs as well as per capita costs for 4 distinct high-cost categories of patients (those with diabetes, CHF, COPD, and coronary artery disease). The first one, total per capita costs, examines the total annual Part A & B spend for beneficiaries attributed to your practice. The attribution scheme for the per-capita-cost measures within the VM is almost identical to that used by most ACOs. CMS looks for the practice that delivers the plurality of “primary care services” to the beneficiary over the course of the year. If your practice delivers more primary care services to a beneficiary than any other practice, CMS is basically saying your practice is in the best position to control that patient’s total Part A & B spend over the course of the year. Honestly, I could not make this up if I tried!

Come on in, the water’s fine

So if you are still with me, let’s wade deeper into the murky waters of MIPS. For Resource Use, MIPS is going to keep the total per capita cost metric, along with its questionable attribution scheme. MIPS also plans to maintain our good friend the MSPB, although to the chagrin of nephrology and many other medical subspecialties, they intend to drop the specialty-adjustment factor, which is part of the VM today. To quote the proposed rule, “It is unclear that the current additional adjustment for physician specialty improves the accounting for case-mix differences for acute care patients, and thus, may not be needed.” Imagine if we practiced medicine with such scientific rigor!

I thought that was the end of the Resource Use story. CMS was going to carry over 2 of the 6 pieces of the VM and use those to roll up your MIPS Resource Use score, while largely maintaining a worrisome, if not flawed attribution scheme. But then I kept reading and discovered there was more.

Those of you who have heeded our advice in the past about chasing down your practice-level QRUR may have noticed that in addition to surfacing the cost and quality items that make up your VM score, CMS is also reporting on the QRUR a number of “episode-based measures.” These are basically episodes of care triggered by a specific diagnosis of procedure. Many of them are surgical in nature (e.g., mastectomy for breast cancer and hip or knee replacement). But many of them are triggered by diagnoses your nephrology patients are admitted with (e.g., pneumonia, CHF, and COPD exacerbation). The timing of the cost calculation for these events varies, but it’s the attribution scheme that should have our attention for these new measures of Resource Use. If you provide over 30% of inpatient E&M codes during the inpatient stay or “triggering event” for these episodes of care, the Part A & B costs of that episode are attributed to you. Wrap you head around that one for a moment, and remember, although this is reported in the QRUR today, it has never been used to impact your paycheck.

One final note about the Resource Use piece of the MIPS puzzle. As noted above, the VM is a practice-level incentive program. All attribution is made at the TIN level, not the NPI level. With MIPS you have the option of being scored at the individual NPI level or as a group. If you choose the individual NPI level, all of the Resource Use metrics I discussed above will be attributed at the individual NPI level. This creates a new angle of excitement. Each of these metrics has a minimum number required to score (typically 20 events). If a category is not scored, it’s excluded from the calculation, which means the remaining categories will carry more weight for your Resource Use score. Crystal clear?

Sea change ahead

So where does this leave us? As I’ve mentioned before, I think MACRA represents a generational change in the way physicians are paid to provide care to Medicare beneficiaries. The proposed rule is easily the most complex rule I have had the pleasure of reading over the past decade. In my view, the Resource Use component is the most confusing piece of the MIPS puzzle, and I actually believe that due to its complexity and what amounts to a lack of transparency, it will be the one you will be least likely to move the needle on. As written, in the early years it will not have much impact on your MIPS score. My advice would be to focus on quality and meaningful use (I mean, advancing care information) and check the box for CPIA.

The public comment period for the MACRA proposed rule closes next week. Do you have comments about the sea change ahead? Share it with us and join the conversation.

Terry KetchersidTerry Ketchersid, MD, MBA, practiced nephrology for 15 years before spending the past seven years at Acumen focused on the Health IT needs of nephrologists. He currently holds the position of Chief Medical Officer for the Integrated Care Group at Fresenius Medical Care North America where he leverages his passion for Health IT to problem solve the coordination of care for the complex patient population served by the enterprise.


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