10 Orgs Call for Medicare Advantage APMs to Qualify for MACRA

May 17, 2017 - A coalition of ten healthcare industry groups recently urged HHS Secretary Tom Price to weigh risk-based Medicare Advantage alternative payment models the same as Advanced Alternative Payment Models under MACRA.

Qualifying participants in MACRA’s Advanced Alternative Payment Model track will automatically receive a 5 percent incentive payment in 2019 for participating in an approved risk-based alternative payment model in 2017.

However, the incentive payments are not currently available to physicians and physician groups partaking in Medicare Advantage plans that include similar two-sided financial risk structures.

“Recognizing the advantages of alternative payment models in MA [Medicare Advantage], we call on the Administration to level the playing field and afford risk arrangements in MA the same credit under MACRA as risk arrangements in traditional Medicare,” the groups wrote.

Physicians should have the same financial incentives to assume financial risk in Medicare fee-for-service as in Medicare Advantage plan contracts.

“Leveling the playing field across Medicare will result in better care for patients and more equitable opportunities for physicians,” they added.

HHS intends for MACRA implementation to motivate more healthcare stakeholders to adopt value-based reimbursement structures. The federal agency also aims to push more providers into two-sided financial risk models by boosting incentive payments for Advanced Alternative Payment Model participation.

However, only seven alternative payment models qualify for the 5 percent incentive payment in 2017 and all seven are based on traditional Medicare payments.

The coalition argued that HHS should include appropriate Medicare Advantage alternative payment models in MACRA since the plans cover up to one-third of Medicare enrollment. In some counties, Medicare Advantage plans also represented almost one-half of all Medicare enrollees.

Additionally, providers in alternative payment models offered via Medicare Advantage plans delivered higher quality care at lower healthcare costs compared to care delivered by providers reimbursed under Medicare fee-for-service models.

A recent American Journal of Managed Care study revealed that patients treated by providers in capitated Medicare Advantage plans had a 6 percent higher survival rate. They were also 11 percent less likely to incur an emergency department visit and 12 percent less likely to have an inpatient admission.

The change in utilization under the Medicare Advantage alternative payment models resulted in over $2 million in savings per 1,000 enrollees.

“Despite providing a higher level of care coordination and better outcomes, in many ways MA payment is on a parallel track to traditional Medicare,” the groups wrote.

While the ten-member coalition recently called on the new HHS Secretary, the group’s leader, CAPG, also asked the previous HHS administration to implement similar Medicare Advantage incentives.

The organization, along with 273 other healthcare industry groups, wrote to CMS Acting Administrator in March 2017. The letter urged the federal department to create financial incentives comparable to those in the Advanced Alternative Payment Model track for providers in risk-based Medicare Advantage models.

The extensive list of supporters suggested that HHS and CMS include Medicare Advantage alternative payment models in MACRA by permitting financial risk in the plans to count toward MACRA participation. They also advised the federal departments to develop a model specifically targeting Medicare Advantage.

The groups expected CMS to respond to their letter in the final 2018 Medicare Advantage rate notice. However, when the federal agency released the rate notice in April 2017, healthcare policymakers did not address the role of Medicare Advantage alternative payment models in MACRA.

Through the most recent letter, CAPG reiterated the call for Medicare Advantage inclusion in the recently launched MACRA programs.

The call summoned new supporters compared to the previous letter with most representing health plans as well as healthcare transformation groups.

“The strong and diverse support for this issue underscores the importance of achieving a level playing field for Medicare Advantage alternative payment models,” stated Don Crane, the President and CEO of CAPG, the organization leading the coalition.