Outpatient Care

MIPS impacts how doctors get paid. Are you ready?

The April 2015 signing by President Obama of the Medicare Access and CHIP Reauthorization Act (MACRA) effectively changed the healthcare game for individual clinicians working in physician practices. The MACRA legislation repeals the existing Sustainable Growth Rate (SGR) reimbursement formula and replaces it with a new Quality Payment Program (QPP) with two tracks: The Advanced Alternative Payment Models (APMs) and the default Merit-based Incentive Payment System (MIPS). A new Medsphere resource takes a closer look at MIPS, which will subsume existing EHR incentive programs.

While the popular misconception is that MIPS has replaced Meaningful Use, this is far from the case. How, then, are things different with MACRA and MIPS? The biggest change is that MIPS effectively alters performance measures for payment reimbursement related to EHR use as outlined via four categories:

  • Quality
  • Advancing Care Information (ACI)
  • Clinical Practice Improvement Activities (CPIA)
  • Resource Use

The Centers for Medicare & Medicaid Services (CMS) measures physician performance in each category and compares it to a predetermined national performance threshold. Data is then used to make adjustments to Medicare Physician Fee Schedule (MPFS) payments, creating incentives for those who score above the national threshold and penalties for those who score less.

Do you know what you need to know to ensure high scores, proper reimbursement and incentive payments? 

Click on MIPS to access Medsphere's resource and learn more about the new federal regime.

Are you ready for the oncoming wave of revenue cycle change?

A few weeks ago, I offered up 10 best practices for successful revenue cycle management. Any practice that implements these regular behaviors will be on a more stable financial foundation. The truth, however, is that things are changing rapidly in healthcare, which is news to exactly no one. So, on top of these 10 recommendations, you also have to manage changes that impact revenue. 

The impact of the Affordable Care Act (ACA) on the insurance market, for example, means deductibles and out-of-pocket expenses are going up for many insured patients, which increases the importance to your practice of collecting payment right after the patient walks in the door.

"The chance of collection drops by 50 percent once the patient is seen," Michael Orseno, director of revenue cycle management with Regent Surgical Health, told Becker’s Hospital CFO. "Focus on hiring competent staff to obtain the correct insurance information and collect out-of-pocket costs up front. It is worth every dollar to pay competent staff to collect every dollar you are owed."

As a HIMSS Revenue Cycle Improvement Task Force whitepaper explains, “Historically, healthcare providers … have designed their revenue cycle systems and processes around business-to-business (B2B) relationships  … with the shift in the marketplace to consumer-directed healthcare (CDH) and the 2010 signing of the [Affordable Care Act (ACA)], providers are now ill-equipped to efficiently handle the expected dramatic increase in consumer payments.”

So, how many dollars are we talking about as healthcare transitions from B2B to a focus on consumers? Potentially, enough to bankrupt many practices. The HIMSS Task Force predicted out-of-pocket expenditures would grow by 68 percent from 2007 to 2015 as the ACA gained traction.

According to medical markets research organization Kalorama Information, direct payments to providers by patients will continue to grow by about 9.5 percent annually and reach $608 billion by 2019.

The expectation is the technology will help make revenue cycle more efficient, but even if you have the technological tools to enhance revenue cycle management, remember that best practices and policies are the keys to making those tools work. The old adage holds here just as it does anywhere—technology + efficient, functional processes enhances function; technology + dysfunction just creates more dysfunction.

Adds Jeff Noonan, senior director for global services firm Alvarez and Marsal's healthcare industry group, "I've seen organizations that have great operations and great culture utilizing ancient technology, but they make it work. But, I have never seen bad operations make great technology work."

Another modern complicating factor is that both payers and providers are crossing over into the other’s domain. Providers are starting up health plans; payers are investing in provider networks. How will this alter the revenue cycle? We don’t know, as Carrie Pallardy explains in Becker’s Hospital CFO, which leaves physician practices with best practices as basically the only way to prepare for an unknown future.

If it seems like revenue cycle management tasks are sapping your practice resources, consider outsourcing, especially for coding and billing.

"As hospitals and physician practices grapple with intense pressure to optimize revenue cycle management processes, outsourcing has emerged as a powerful solution to the challenges of a rapidly changing healthcare model," said Black Book Managing Partner Doug Brown.

An experienced revenue cycle outsourcing team can perform activities like reviewing the payer mix and reimbursement profile for payers much more quickly than your back-office staff. For practice decision makers, detailed reports defining the insurance payer mix are invaluable when it comes time to make critical contracting decisions.

What you don’t need now is another layer of complexity on top of the numerous changes you already face. But revenue cycle management perhaps warrants more attention simply because more efficiency in this area pays for investments elsewhere.

Until healthcare in America becomes something other than a business, healthcare providers have to focus intently on the bottom line. If you put your practice on a firm but nimble footing, changes will seem more like gentle waves lapping at the shore than an inundating tidal wave.  

Mordy Pelleg is the founder and president of Medsphere's MBS/Net division, a proven provider of essential tools and services necessary to effectively manage physician practices. 

Subscribe to Outpatient Care