Medicare Compliance & Reimbursement

The rewards can be great with APMs, but so can the risks.

Most eligible clinicians (ECs) participate in the standard Merit-Based Incentive Payment System (MIPS) track while others seek out the revenue rewards that come from a MIPS-based Alternative Payment Model (APM). But for some Part B providers, the lure of long-term payoffs and professional accolades leads them to join Advanced APMs, avoiding MIPS altogether.

If the rumored financial windfalls of joining an Advanced APM seem too good to be true, that's because they probably are - and you may end up making more money by staying on the MIPS path, suggests Mike Schmidt, vice president of client success and regulatory affairs for Eye Care Leaders in Charlotte, North Carolina.

Background: With the Quality Payment Program (QPP) Year 2 underway, MIPS is steadily gaining traction as Medicare's primary payment delivery system. This is mostly in part to scaled-back requirements as well as an increase to the low-volume threshold that cuts many out of participation in the first place. Remember, "CMS has tried hard to make MIPS easier to succeed in, MIPS remains an entirely viable option for most providers," reminds Schmidt.

However, some industry organizations like Medicare Payment Advisory Commission (MedPac) and the American Medical Association (AMA) insist that Advanced APMs are the best way to succeed within the QPP. Even CMS predicts it will see a large increase in Advanced APM participation in 2018 despite the significant upfront investments and setups necessary to start or join one (See Medicare Compliance & Reimbursement, Vol.44, No.7).

Not everyone is convinced that Advanced APMs are superior to MIPS, and your start-up costs may not translate to long-term financial and professional gains. "It is worth noting that some specialty organizations such as [American Academy of Ophthalmology] AAO do not recommend any form of APM participation to its members, since there are none suitably tailored for their specialty," says Schmidt. In fact, right now a majority of the Advanced APMs are focused on primary care, and specialists may have a tough time finding one that accommodates their area of expertise.

Here's Why You May Want to Rethink the Jump to an Advanced APM

More ECs are interested in Advanced APMs, but do not realize that the MIPS APMs may be the smarter option. "Clearly APM participation is growing, but keep in mind that there are actually two APM tracks: the so-called 'MIPS APMs' with lower financial risk and the 'Advanced APMs'," Schmidt advises. "Currently, more providers participate in MIPS APMs than in Advanced APMs, and although the government wants providers to assume greater financial risk by participating in advanced APMs, my prediction is that MIPS APMs will maintain their greater popularity for years to come."

He adds, "Either APM track solves the economy of scale issue which CMS predicted would so negatively affect small practices in the standard MIPS tracks, simply because the typical APM Entity (such as an ACO) is an organization large enough to have dedicated regulatory, quality, and IT resources [and] can be counted on to achieve an optimized MIPS score."

Consider this: For the advanced APM track, you should carefully weigh whether that is the best option for your practice. Many ECs don't want to deal with the hassle of MIPS, so they figure that participation in an advanced APM is obviously the way to go. Not so, says Schmidt. "In determining the track that you want to be on for the QPP, the key decision point is to not just consider the financial impact from the MIPS program alone, but to also be aware of the financial impacts of the other [APM] program," advises Schmidt.

Caveat: With the advanced APM track, you won't have to deal with the mechanics of MIPS reporting. However, the financial incentive is less - a maximum of 5 percent, whereas in MIPS you could get up to 9, plus a possible exceptional performance bonus.

And remember, with an advanced APM, it's not just the bonus you need to worry about - there's dual-sided financial risk. "You could have a negative adjustment," warns Schmidt. "Congress wants to contain Medicare costs by moving you onto that [APM] track. They have a sort of darker reason to get you onto that track, so be aware of that."

MIPS May Still Be Your Best Bet

If you factor in the risks, needed resources, and financial adjustments of Advanced APMs, you may realize they're not all they're cracked up to be. And that's why Schmidt suggests that the "MIPS APMs such as the Shared Savings Program Track 1 may be worth considering as much as an Advanced APM."

"The possible MIPS positive payment adjustments plus exceptional performance bonus payments can actually exceed the Advanced APMs incentive payments, so there may be less advantage to Advanced APMs in the next few years than many people may suppose," Schmidt stresses. "In the long term - many years from now - Advanced APM participants will be eligible for a higher rate of increase of [Fee-For-Service] FFS payments as compared to MIPS participants, but not in the next 6 years."

Endnote: "For specialists in fields such ophthalmology, for which there is no APM tailored to the needs of the specialty, it may be advantageous to stay on the standard MIPS track instead," counsels Schmidt. "One reason is that the specialty MIPS quality measures will be published by CMS on Physician Compare, and in the modern era of internet comparison shopping it may be important for providers to showcase their clinical performance, for measures that actually apply to them in their specialty." He continues, "Participating in an APM designed for primary care will typically fail to allow specialists to receive credit for their clinical quality in any specialty-specific manner."

Resource: For all the specifics on Advanced APM participation, visit https://qpp.cms.gov/apms/overview.