Medicare on Friday unveiled a far-reaching overhaul of how it pays doctors and other clinicians. Compensation for medical professionals will start taking into account the quality of service—not just quantity.
The massive regulation is known as MACRA, or Medicare Access & CHIP (Children's Health Insurance Program) Reauthorization Act. It's meant to carry out bipartisan legislation passed by Congress and signed by President Barack Obama last year.
MACRA creates two new payment systems, or tracks, for clinicians. The majority of medical professionals billing Medicare—some 600,000 doctors, nurse practitioners, physician assistants and therapists—are affected. Medical practices must decide next year what track they will take.
Starting in 2019, clinicians can earn higher reimbursements if they learn new ways of doing business, joining a track that's called Alternative Payment Models. That involves being willing to accept financial risk and reward for performance, reporting quality measures to the government, and using electronic medical records.
Advocates say the new system will improve quality and help check costs. But critics say the complicated requirements are overwhelming for solo practitioners.
It's going to take time to assess the impact on Medicare's 57 million beneficiaries.
The government's premier health insurance program is in the midst of an overhaul in how it pays service providers, trying to shift to a new emphasis on rewarding quality. But it may take years to see whether the new approach can lead to major savings.
Medicare's previous congressionally-mandated system for paying doctors proved unworkable. It called for automatic cuts when spending surpassed certain levels, and lawmakers routinely waived those reductions. MACRA was intended as a new beginning.
Medicare officials say the change will be gradual, and the agency is requesting additional public comment on Friday's final rule.
Officials say they worked to address the concerns of smaller medical practices, by exempting more of them from the new system.