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MedPAC, MIPS, and the Tenacity of Fee-for-Service

Updated: Apr 5, 2018



This March 2018, the Medicare Payment Advisory Commission (MedPAC), an independent congressional agency tasked with advising Congress regarding Medicare, reiterated and expanded on recommendations to scrap and replace the Merit-based Incentive Payment System (MIPS) with a voluntary value program (VPP) , predicting the imminent failure of MIPS. At its core, MIPS is meant to help drive the fee-for-service Medicare payment system based on volume to a payment system based on value and patient-centered care, alongside advanced alternative payment models (A-APMs). MedPAC’s recommendation to eliminate MIPS is augmented by recent congressional action through the Bipartisan Budget Act (BBA) of 2018 to further limit clinician eligibility for MIPS by removing Part B drugs from eligibility calculations.


Ultimately, Congress has the final say in building up or dismantling MIPS. Although implementation of MedPAC recommendations requires congressional action and broader health reform efforts remain in limbo, MedPAC is not being ignored in the all-important Medicare regulatory space (See 2016 MedPAC recommendations to cut 340B Medicare Part B payment rates and actual cuts included in the 2018 CMS Hospital Outpatient Prospective Payment Final Rule). In short, it is worth the time to take note of MedPAC.


MedPAC’s stated concerns about MIPS, including but not limited to reporting burdens on clinicians, lack of meaningful clinician quality measures (one major issue is self-selection of measures, another is inability to compare results equally across clinicians), and uncertain payment incentives hint at a real possibility that MIPS may suffer a similar fate to the sustainable growth rate (SGR) that it was, in part, meant to replace.


Indeed, some of MedPAC’s concerns have played out in CMS regulations. The 2018 MIPS Final Rule expanded exemptions from MIPS participation, raise concerns that just as the sustainable growth rate (SGR) was negated by Congress from 2003 through 2014, increasing flexibility may continuously delay MIPS and limit its impact. MedPAC argues that MIPS is already doomed, having been constructed on flawed CMS quality programs. The BBA, passed after the latest MedPAC report was drafted, strengthened this trend further by eliminating Part B drugs from MIPS calculations both for MIPS cost metrics and eligibility, further limiting participation.


These trends point to the increasing importance of A-APMs as alternatives to MIPS. MedPAC’s VVP (still in conceptualization stage) would essentially be a training ground for A-APM participation, though its voluntary nature raises concerns about whether anyone would be incentivized to participate. The VVP would include validated measures, focusing on population-based outcomes, patient experience, and value. The VVP would feature value-based payments linked to population-based measures, reported by all VVP participants. To address reporting burden, all measures would be linked to CMS claims data, requiring only normal billing practices to participate. All of that said, VVP has yet to be further developed and MIPS is still here, if diminished. It seems clear that increasing emphasis on A-APMs will continue for the foreseeable future.


By Jon Larsen, JD, MPP, McGA Policy Consultant


#MedPAC #Fee-for-service #MIPS #CMS

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