It’s been just over a month since CMS released the notice of proposed rule making (NPRM) for the 2018 version of the Quality Payment Program (QPP). Diana masterfully unpacked much of the meat in that NPRM a few weeks ago. As we enter the dog days of summer, let’s have some fun with numbers that surfaced within this proposed rule.
Much has been written about the proposed increase to the MIPS low-volume threshold exclusion. In 2017, if you provide care to 100 or fewer Part B enrolled Medicare beneficiaries, OR your Part B allowable for the year is less than or equal to $30,000, you are excluded from MIPS. In an effort to provide additional relief for “small practices” and for docs practicing in rural markets, the NPRM proposes to bump the low-volume threshold numbers to 200 patients OR $90,000. Note CMS defines small practices as those with 15 or fewer providers. Using this definition, the vast majority of the nephrology practices in this country would be considered small practices.
If the proposed increases to the low-volume threshold make it into the final rule, CMS estimates an additional 134,000 eligible clinicians will avoid MIPS in 2018. CMS goes onto state that almost half of those excluded would be in small practices. Folks, when I do the math here, nephrology is left out in the cold. Unless you are practicing part time, it’s not going to take long to blow through the $90k mark. I guess if your practice were restricted to seeing an outpatient dialysis population, or perhaps if you have closed your practice to new Medicare patients, you might see fewer than 200 Medicare beneficiaries per year. But outside of our advanced practioners, I see no relief for nephrologists in these numbers, regardless of your practice size.
A few weeks ago, I mentioned the good news from D.C. regarding the dry run for Qualifying Participant (QP) status within the existing 37 ESCOs. Recall as a QP in an Advanced APM, you are not only excluded from MIPS this year, but in 2019 you will receive a lump-sum payment equivalent to 5% of your 2018 Part B allowable. For 2017, CMS estimates that between 70,000 and 120,000 eligible clinicians will achieve QP status. For 2018, they estimate the QP figure will soar to between 180,000 and 245,000 eligible clinicians! The reason for the surge? The Medicare ACO track 1 Plus (1+) Model will be considered an Advanced APM and they are reopening the application cycle for both the Next Gen ACO and the Comprehensive Primary Care Plus Models. There will not be another application cycle for ESCOs in 2018, but they have made minor changes to the ESCO geographic constraints, and I would anticipate many of the existing ESCOs may expand in 2018.
While we are on the subject of Advanced APMs, another number that’s receiving some attention (undue in my view) is the monetary risk participants in an APM must be subject to in order for the APM to be considered an Advanced APM (and thus convey the potential benefits of avoiding MIPS and collecting the 5% AAPM bonus). “The APM must require that participating APM Entities bear risk for monetary losses of a more than nominal amount under the APM.” This “more than nominal amount” calculation has caused many heads to spin, so let’s try to simplify it.
As it stands today “total potential risk under the APM must be equal to at least: either 8% of the average estimated Parts A and B revenue of the participating APM Entities for the QP performance period in 2017 and 2018 (the revenue-based standard), OR 3% of the expected expenditures for an APM Entity is responsible for under the APM for all performance years.” Note the ESCOs almost universally rely on the 3% figure noted in the preceding sentence. The NPRM is proposing to maintain the 8% figure for 2 more years (through performance year 2020). Again, this will have absolutely no impact on the ESCO model of care.
The butcher’s bill
One of the most intriguing set of numbers in these proposed rules are the cost-accounting projections CMS is compelled to report. Let’s close this post by taking a look at how much money CMS believes will change hands in 2018 based on the content of this NPRM. First, what’s it going to cost for the estimated 572,000 eligible clinicians to participate in MIPS? The financial impact to the participants in MIPS for “collection of information-related burden” is estimated to be a cool $857 million. That’s about $1,500 per provider. The comical part of this calculation is the dollar-per-hour figure they attribute to a doc’s time. In my opinion, this is vastly underestimated.
How much money does CMS intend to spend on the QPP related to the work we will do in 2018? Well, with respect to MIPS, it is anticipated that the fee-schedule adjustments in 2020 due to the MIPS scores in 2018 will net to zero. Remember this is a budget-neutral program, so the anticipated $173 million in positive adjustments paid to those who do well in MIPS will be covered by the $173 million CMS anticipates collecting from those who don’t do so well in MIPS next year. But that’s not the end of the MIPS bill CMS anticipates paying. Remember they intend to spend $500 million next year on providers who demonstrate exceptional performance in 2018—defined as total MIPS score of greater than 70.
Last but not least, what about the 5% APM bonus they expect to pay the 180,000 to 245,000 Advanced APM qualifying participants? The price tag for that is between $590 and $800 million. So, let me take my shoes off on this sultry summer afternoon to count a little higher. Eligible clinicians will conservatively spend $860 million they would not have spent outside the QPP. Roughly half of those in MIPS will see their fee schedule drop by $173 million in 2020. The half on the right side of the MIPS equation will enjoy a collective $673 million bump in their fee schedule that year, while those QPs in an Advanced APM will take home an additional $590-800 million.
Put those shoes back on
Wonder what this will look like in a couple of years? The number of QPs will likely continue to increase and the magnitude of that budget-neutral piece of MIPS will almost certainly double. Whether it advances care or not, there’s a lot of money changing hands within the QPP. Have you had fun with numbers today? Drop us a comment and let us know what you think about the 2018 QPP proposed rule.
Terry 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.
Image from www.canstockphoto.com