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MACRA: The status quo is not an option

166 days. 23 some odd weeks. Less than six months. This is how long the health care industry has to prepare for the first day of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).1 But, it may be an uphill battle to get there: According to Deloitte’s 2016 Survey of US Physicians, half of surveyed physicians have never heard of MACRA, and most physicians would have to change aspects of their practice to meet the law’s requirements and do well under its incentives.

Some physicians may think of MACRA simply as “the law that repealed the sustainable growth rate (SGR),” leading them to believe that they can move on and forget about the annual doc fix debate they had grown so accustomed to. Others may read the comments from Acting Administrator Andy Slavitt last week that the US Centers for Medicare and Medicaid Services (CMS) is open to considering changes to the implementation of MACRA, including shorter reporting periods and alternative start dates, as a repeat of ICD-10 implementation – a deadline that will inevitably change before it is finalized.2

But, MACRA is more than a Medicare payment law or a fix to the SGR debate. And it is here to stay.

MACRA is a transformative law that, with bipartisan support from both sides of the aisle in Congress, is on track to fundamentally change how physicians and other clinicians are reimbursed under the Medicare Physician Fee Schedule (PFS). It will also drive major health care payment and delivery system reform for clinicians, health systems, Medicare, and other government and commercial payers for years into the future.

Deloitte’s 2016 Survey of US Physicians sought to quantify where physicians – the primary subjects of this transformation – are in their familiarity and understanding of the law and how prepared they are to transform with it. The results suggest that many physicians will have a lot of work to do over the next few months to prepare for January 1, 2017. Indeed, half the non-pediatric physicians we surveyed say they had never heard of MACRA, and less than one-third say they recognize the name but are not familiar with the requirements.

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More self-employed physicians and physicians in independently owned medical practices (21 percent) report that they are somewhat familiar with the law than physicians employed by hospitals, health systems, or medical groups owned by them (9 percent). But, physicians with a high share of Medicare payments tend to be just as unaware of MACRA as others.

We also found that while most physicians surveyed agree that health care system performance can be improved by measuring care outcomes and processes and measuring resource utilization and costs, most physicians also believe that performance reporting is burdensome. Few support tying compensation to quality and most prefer traditional compensation models, such as fee-for-service and salary over value-based payment models.

Early in my career, daily life involved many interactions that inevitably took me out of my comfort zone. The first day of residency was one of them. Making the leap from medical student to practicing physician was larger – and a bit more uncomfortable – than I could ever have imagined. But, day by day, practicing medicine became more comfortable – more natural.

Today, many physicians appear to feel the same way about payment reform. The new competencies and capabilities required of them may seem uncomfortable. Many physicians will need to change aspects of their practices to meet new reporting requirements. And, MACRA’s significant financial incentives to participate in risk-bearing, coordinated care models and move away from the traditional fee for service system suggest that physicians should consider bearing increased financial risk in the future.3

The good news is that, according to the survey, as physicians gain more experience with value-based care efforts, they tend to be more prone to understanding its identified benefits and are more open to its possible improvements to the delivery system. The industry as a whole has a great deal of work ahead to prepare for MACRA and its impact. At this point, staying within your comfort zone is not an option – keeping the status quo is not an option.

1 Deloitte analysis of the US Centers for Medicare and Medicaid Services, Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models, Proposed Rule, 2016
2 Shannon Muchmore, Modern Healthcare, “Slavitt suggests MACRA could be delayed,” July 13, 2016
Deloitte analysis of the US Centers for Medicare and Medicaid Services, Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models, Proposed Rule, 2016

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Author bio

Dr. Mitch Morris is the Vice Chair and Global Leader for the Health Care Sector at Deloitte, including Consulting, Audit, Tax, and Financial Advisory Services. Dr. Morris has more than 30 years of health care experience in consulting, health care administration, research, technology, education, and clinical care. Earlier, he served as a Senior VP of health systems and CIO at MD Anderson Cancer Center where he was also Professor in Gynecologic Oncology and in Health Services Research.