As many people are discussing methods to improve healthcare, the Centers for Medicare & Medicaid Services (CMS) is giving stakeholders an opportunity to send in their thoughts on this topic.  In CMS’s April 14, 2017 proposed rule, CMS issued a “Request for Information” (“RFI”), where they described their desire to have a “national conversation” about improving the health care delivery system.

CMS would like to know, amongst other ideas: (1) How CMS can help make its healthcare delivery system (Medicare) less bureaucratic and complex; and (2) How CMS can reduce the burden on clinicians, providers and patients in a manner that increases quality of care and decreases costs.  “CMS is soliciting ideas for regulatory, sub-regulatory, policy, practice and procedural changes to better accomplish these goals.”

Per CMS, some ideas could include recommendations regarding payment system re-designs; elimination or streamlining of reporting; monitoring and documentation requirements; and operational flexibility; amongst others.  CMS is also looking for ideas on how CMS issues regulations and policies, and how these could be simplified.

In a separate RFI in the same proposed rule, CMS also seeks information on how the scope and restrictions imposed on “Physician-Owned Hospitals” affect the delivery system, particularly with regards to Medicare beneficiaries.

To the extent respondents have data and specific examples, CMS requests such information be included in the submission.  If a proposal involves novel legal questions, CMS is also welcoming analysis regarding CMS’ authority.

If you wish to submit your comments to CMS, you have until June 13, 2017 to do so.

For more information please see the CMS Fact Sheet for Fiscal Year (FY) 2018 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System Proposed Rule, and Request for Information CMS-1677-P.

The Medicare incentive programs with which you and your medical practice are familiar will soon be no more.  As of January 1, 2017, these programs (including the Electronic Health Records (EHR) Meaningful Use Incentive Program, the Physician Quality Reporting System (PQRS), and the Physician Value-Based Modifier Program) will morph into the new Medicare Quality Payment Program (QPP).   The QPP will also include a fourth category of incentives entitled “Clinical Practice Improvement Activities”, which we discuss in more detail below.

The purpose of the QPP is to create one central program that will govern Medicare Part B payments to physicians, while incentivizing physicians to increase quality of care and decrease inefficiencies in the cost of care for Medicare patients.  Participation in the QPP will be mandatory beginning January 1, 2017.  The QPP will either reward or penalize physicians and their practices by adjusting their reimbursement rates under the Medicare Physician Fee Schedule two (2) years after the reporting year.  Therefore, physicians/practices will have their reimbursement rates adjusted in 2019 based on their reporting data for the year 2017.

As we noted in our first blog post in the Series, accessible here, physicians will have the option to choose between two payment tracks under the QPP:  (1) the Merit-Based Incentive Payment System (MIPS); and (2) an Advanced Alternative Payment Model (Advanced APM).  This blog post will discuss the basics of the MIPS and how to qualify for the MIPS in 2017, while our next post will touch on the basics of participation in Advanced APMs.

Basics of the MIPS

Each physician or group practice (you may report individually or as a group) participating in the MIPS in 2017 will earn a “composite performance score” based on the physician/group’s scores within the following four (4) categories:

  1. Quality of Care – 60%
    • Explanation: Scored based on the reporting of “quality measures”, which will be published annually by CMS.  Physicians will be able to choose which quality measures they will report each year.
    • Replaces: PQRS and quality component of the Value-Based Modifier.
  2. Advancing Care Information – 25%
    • Explanation: Scored based on the reporting of EHR use-related measures with which you are familiar from the current EHR Meaningful Use Incentive Program.  However, unlike the existing program, the QPP measures will not have “all-or-nothing” targets.
    • Replaces: EHR Meaningful Use Program.
  3. Clinical Practice Improvement Activities – 15%
    • Explanation: Scored based on attestation by the physician/group that the physician/group has performed certain care coordination, beneficiary engagement, population management and patient safety activities.
    • Replaces:   New Program.
  4. Resource Use – 0%
    • Explanation: Scored based on per capita patient costs and episode-based measures.  CMS collects and analyzes the data from your claims submissions.  No additional reporting will be required.
    • Replaces: Cost component of the Value-Based Modifier.

How to Qualify for 2017

CMS has eased the reporting requirements for the first year of the QPP.  No physician/group will be required to begin collecting data in accordance with the QPP’s requirements on January 1, 2017 (but may elect to do so).  To receive a neutral or positive payment adjustment, physicians/groups will need to report data for only a 90-day performance period during the year.  There are also minimum threshold reporting requirements to avoid a negative payment adjustment and full participation requirements which are more likely to result in a guaranteed positive adjustment.  The table below organizes the requirements in an easy-to-read format:

MIPS Measures Chart

Final Thoughts on Qualifying for the MIPS in 2017

  • Get involved sooner rather than later. CMS has kept reporting requirements minimal in 2017 in order to encourage clinicians to participate in the QPP.  Take advantage of that opportunity to ensure your practice has the right software to report the quality and EHR use-related measures.  Since adjustments will be made based on threshold scores, it may be easier in 2017 to earn a positive adjustment, and even an exceptional bonus, than in later years.
  • Ensure that your current EHR technology meets the requirements for the QPP in 2017, including reporting capabilities for quality measures and EHR use-related measures. The easiest way to do this is to contact your EHR vendor.
  • CMS has given providers plenty of time to report 2017 data. The deadline for reporting 2017 data is March 31, 2018.

As always, if you have questions specific to your practice, please contact a knowledgeable and experienced attorney.

The long-anticipated implementation of ICD-10 coding finally began this past Thursday, October 1, 2015.  As of that date, government and commercial payors ceased to accept claims under the old coding system (ICD-9).  The transition has been five years in the making due to a government delay in 2012.

The new system has five times the codes of the prior system, including everything from “problems in relationship with in-laws” to “pedestrian injured in collision with roller skater” to “burn due to water-skis on fire”.  The hope is that the breadth and detail of the new codes will provide greater accuracy and increase reimbursement rates.  However, the complexity of ICD-10 could also cause substantial delays in reimbursement from both the provider side and the insurer side.  While CMS and other insurers are committed to ensuring that the implementation of the new system is completed, it is up to each provider to prepare for and manage the transition in their own practice.

Here are a few tips for your practice during the transition:

  • Mitigate the risk of longer-than-expected reimbursement times by setting aside a reserve fund to cover interim operating expenses, such as payroll, in the event of a one to two week delay in reimbursement during the next few months.
  • Whenever your staff has specific claims questions, contact the appropriate payor sooner rather than later.
  • If you haven’t already, consult your practice management and EHR software vendors to find out how they recommend using their technology with the new coding system.
  • In an effort to speed up the learning curve, consider asking your billing and coding staff to dual code a few charts each day.  This will give them additional opportunities to train, while reducing the need for extra training sessions down the line.

Adding an interesting wrinkle to an already complex environment, the Federal Trade Commission filed a suit this month to block an Idaho hospital from acquiring a physician practice.  According to an article on, the FTC and the IDAHO Attorney General have filed an antitrust complaint  seeking to block St. Luke’s Health System’s acquisition of Saltzer Medical Group, a large multi-specialty practice.  The FTC’s alleges that the acquisition would result in St. Luke’s having a 60% share  of the local primary care market.  This most recent foray into the physician/hospital acquisition arena suggests that a truly integrated delivery model may simply not be possible in some markets.

I imagine that few physicians contemplated being part of organized labor when they enrolled in medical school but as more and more physicians make the leap from private practice to hospital employment, perhaps large-scale unionization of the physician workforce could become a reality.  According to an article by David J. Leffell today on, the notion is perhaps not as far-fetched as we might have thought.  Mr. Leffell notes that one of the side-effects of the shift by physicians to employee status will be the right to engage in collective bargaining.  This presumably would also entail the right to strike — likely not the ideal model for the delivery of quality care.  The implications of physician unionization are so monumental that one must wonder whether this possibility is an unintended consequence or an intended result. 

 The term "concierge medicine" conjures images of exclusivity, special treatment and high cost.  But can the concept be adapted to appeal to the masses?  With an impending shortages of doctors – particularly in primary care – and many more patients covered by insurance than ever before (under the Affordable Care Act), there is a reasonably good chance that patients will need to wait longer for an appointment with their doctor and be able to spend less time visiting with him or her.  In addition, more and more Americans are covered under high deductible health plans.  Increasing out-out-pocket costs and decreased access might be the ingredients necessary to give birth (or rebirth) to cash pay medicine.  For more on the possibility of affordable "concierge" medicine, consider this recent article published on

According to a recent study published in the Journal of the Association of American Medical Colleges, a primary care physician who graduates with education debt of $160,000 should be able to raise a family, live in an expensive urban area, and repay their debt in 10 years without incurring additional debt, as long as their household income and spending are consistent with median statistics. However, the ability to meet education debt repayment obligations as a primary care physician becomes significantly more difficult when the education debt is $200,000 or more. According to the study, of 2011 medical school graduates, 59% had education debt of $150,000 or more at graduation, 33% had more than $200,000, 15% had more than $250,000, and 5% had more than $300,000.

By national standards, physicians – even primary care physicians — have a pretty good earning capability. However, the financial, emotional and physician investment required to earn a medical degree and complete training is daunting – particularly when coupled with the fact that most physicians cannot begin saving for retirement in a meaningful way until their early to mid-thirties. With the emphasis placed on primary care under the federal Affordable Care Act, what will the federal government need to do to entice the best and the brightest to go into primary care? 

Federal antitrust enforcement authorities have historically not gotten too excited about hospitals acquiring physician practices.  However, it is apparent from recent enforcement activity that the Federal Trade Commission (FTC) is keeping a wary eye on physician/hospital integration. According to the American Medical News, the FTC recently ordered a Nevada health system to allow a number of its "acquired" cardiologists out of their employment agreement restrictive covenants. According to the order, the FTC found that the health system’s acquisition of two large cardiology groups had the effect of reducing competition in the health system’s market. For more on the order, see "FTC Order Could Give Physicians a Way Out of Noncompete Deals With Hospitals" in

As the debate regarding healthcare reform rages on, perhaps too often the blame for rising health care costs is pointed at physicians, and as a result, physician reimbursement has historically been an easy target for cost-cutting. Unfortunately, as a recent New York Times article illustrates, in only a few short years, the demand for healthcare services in the United States will far outpace the supply of physicians. According to the Times article, by 2015, the country will be facing a shortage of more than 62,000 physicians across all specialties. While the demand for physician services will undoubtedly force insurers to reimburse physicians at competitive rates, given the length of time it takes to train a new physician, we can certainly expect this shortage to have a direct impact on access to care in many communities for quite some time. Hospitals and third-party payers are well-advised to begin structuring their physician networks to try to minimize the impact this shortage will have on patient access.

According to an article in the Arizona Republic posted on, Health Net of Arizona has begun offering a new "narrow network" HMO product to employers in conjunction with Banner Health, a health system offering healthcare services in seven western states.  Under the new plan, employers will receive premium discounts for limiting their network of providers to the newly formed "Banner Health Network".  Presumably based on an ability to better manage care within an integrated network, Health Net believes the should offer a 20% savings over its traditional PPO products.

The emergence of narrow network HMO products is a trend worth watching for several reasons: first, it demonstrates that third party payers are aggressively seeking to better manage health care costs and are looking for innovative ways to do so; and, second, it is apparent that as new products are developed, those providers who are integrated (both horizontally and vertically) are most likely to be the players of choice, as they will presumably have a greater ability to control costs across the delivery continuum.  Physicians and other providers should take these developments to heart when developing their strategic plans for the coming year(s).