Defining MACRA: What Is It, and How Will It Impact Your Organization?

(Updated June 21, 2017)

The first reporting year of the Medicare Access and CHIP Reauthorization Act (MACRA) is officially underway, but many physicians and healthcare organizations across the country still struggle with comprehending where they stand. Providers no longer have time for guessing. Instead, healthcare organizations must create and maintain strategic plans for reimbursement, covering everything from who will head MACRA initiatives to what reporting measures best match organizational strengths. Let’s begin by answering some key questions about the final rule.

What is it?
MACRA replaces the old sustainable growth-rate (SGR) formula for physician payment, transitioning focus from fee-for-service to value-based care. Clinicians now need to pick from one of two reimbursement tracks: the Merit-based Incentive Payment System (MIPS) or Advanced Alternative Payment Models (APMs).


APM versus MIPS
A lot of confusion can arise when physicians try to understand what path under MACRA is best suited to their business. With the initial reporting year already underway, if you’re unsure of your path, you’re likely not reporting under APMs. The Advanced APM track offers practices the opportunity to earn more in exchange for taking on some risk related to patient outcomes. Models qualifying for 2017 reporting include the Comprehensive ESRD Care Model (Large Dialysis Organization arrangement), Medicare Shared Savings Program (Track 2), Medicare Shared Savings Program (Track 3), Next Generation ACO Model, Comprehensive Primary Care Plus (CPC+) and Oncology Care Model Two-Sided Risk Arrangement. In 2017, under the Quality Payment Program, clinicians may earn a 5 percent incentive payment through participation in these Advanced APMs.

The other option, MIPS, is based on reporting quality metrics, resource use, clinical practice improvement and advancing care information categories. Performance tracking for MIPS began January 1, 2017, with reported data submission due by March 31, 2018, for the 2019 adjustment payment period. In this initial 2017 performance year, physicians can earn or lose a potential 4 percent of their reimbursement. Those exempt from MIPS reporting are providers who do not generate at least $30,000 in Medicare Part B billing, and those who do not provide service to at least 100 Medicare patients per year. For the 2018 reporting year, CMS is now proposing to amend exemption threshold to $90,000 and 200 Medicare patients per year to help small practices.

The difficulty with MIPS is determining the metrics for reporting that best align with physician care and organizational strengths. Also, physicians have options within this first year toward what reporting pace they’re utilizing.

The significance of MACRA moving forward
No matter your health organization’s reporting path, MACRA requires physicians to properly capture, maintain and analyze data from both financial and clinical areas to maximize their reimbursement opportunity. In the transition to value-based care, MACRA pushes healthcare providers to be more strategic and stringent with their data to meet reporting requirements, prepare for future regulation changes and cater to today’s evolving patient needs.

Progress for Small and Rural Health

Today’s small and rural healthcare providers still find themselves hindered by financial and staffing limitations amidst growing industry standards and regulations. As patient expectations evolve in the transition to value-based care, these organizations’ IT capabilities fall behind the curve. Lack of budget prevents the ability to transition EHR vendors or bring in outside resources to aid with optimization initiatives. With limited staff, practices cannot pull individuals away from regular duties to focus on IT training. In turn, practices struggle with moving beyond inefficient workflows and processes or being able to effectively gather and analyze data for quality measures. For rural health, geographic location also limits patient engagement and population health management capabilities. Patients are less likely to complete wellness visits or additional health maintenance when they have long commutes or limited access to physicians.

Despite these small and rural health IT challenges, positive progress across the industry can aid these struggling providers.

Mobile health- Mhealth app usage doubled from 2013 to 2015, according to a PwC survey, and growth is expected to continue in 2017. Mobile health applications can help isolated healthcare providers improve outreach, population health management and patient engagement efforts, while keeping patients out of the hospital. Mhealth capabilities can also expand rural providers’ impact on patient follow-up care and wellness decisions for improved care delivery. M-health capabilities can expand small and rural providers’ impact on patient follow-up care and wellness decisions for improved care delivery.

Telemedicine- According to a recent survey, 20 percent of patients would switch their current primary care provider if another provider offered them telehealth visits. Congress’ 2016 passing of the Expanding Capacity for Health Outcomes (ECHO) Act offers opportunity for remote and rural health providers to offset budget, specialty care and staffing limitations. ECHO expands Project ECHO’s model that pairs academic medical specialists with primary-care providers through virtual clinics for mentoring with behavioral and population health management. Proven through several academic studies, Project ECHO’s model overcomes rural physicians’ physical isolation through cost-effective access to specialty care best practices.

HRSA funding- The Health Resources and Services Administration (HRSA) allocated more than $16 million toward rural health telehealth and quality improvement initiatives. Administered by the Federal Office of Rural Health Policy, funding benefits 60 rural communities amongst 32 states. Of that, seven Rural Health Research Centers will receive $700,000 annually to investigate the health, economic and access challenges among these populations and how federal programs are impacting care and outcomes.

Interoperability- Small and rural health providers are often at the mercy of their EHR vendors in terms of willingness and capability of data sharing, as well as necessary version updates to meet with reporting requirements. With the passing of the 21st Century Cures Act, the U.S. government now clearly defines data blocking while issuing a commitment to holding the private sector accountable for transparency in health IT. This puts pressure on vendors to enable interoperability, which better connects small and rural providers for better patient care and safety across patients’ medical journeys.

Making Sense of MACRA

After a slew of feedback from healthcare and HIT professional organizations, like CHIME, AMA and MGMA, CMS announced new flexibilities in the Medicare Access and CHIP Reauthorization Act (MACRA) final rule. Though CMS released the final ruling several weeks ago, physicians still struggle to grasp the impact or even understand what the new reimbursement structure is.

MACRA replaces the old sustainable growth-rate formula for physician pay. Under MACRA, physicians can pick from one of two Medicare reimbursement tracks – the Merit-based Incentive Payment Program (MIPS) or Advanced Alternative Payment Models (APMs). To better aid physicians with these programs, CMS has set up additional resources:

  1. With $700 million in funding, CMS created practice transformation networks as frontline assistance focusing on elevating clinicians’ population health to enable physician success under MIPS and eventually transition them APMs.
  2. With $100 million in funding, CMS specifically directed aid toward solo, small and rural health practices to get them up to speed and in the know about reporting requirements and means for success.

Beyond these initiatives, how can you become better informed? For a breakdown of MACRA regulations and questions to consider, check out our slide set Making Sense of MACRA.


Visualize Financial Performance with BI Dashboards

The combined use of financial analytics and business intelligence (BI) within a healthcare organization can considerably improve operational effectiveness if applied properly. Direct benefits include reduced costs, increased efficiency, optimized catchment areas and network management, improved pay for performance/accountability and better operating speed. 

Getting Underway
No financial analytics journey can start without a solid project roadmap identifying expectations and timelines. Appoint a project manager to oversee the team’s work and lead daily management, while assigning co-leads as well with one from IT and one as the champion of the financial analytics project. This champion needs to understand the vision and be able to work within the political climate and structure of the organization.

When creating a financial analytics project roadmap, consider additional ongoing IT projects that may serve as interdependencies or conflicts. Define the budget and overall timeline. This will drive follow-up steps and selection of team members who have the appropriate timeframe for their work involvement.

Initial project steps should also include distinctly defining the project’s ROI. Focus and specify what the financial analytics dashboard will achieve. With the expected ROI, budget, timeline and project management defined, select the project team. Keep in mind that everyone is not capable of doing analytical work. Attention to detail, perseverance, ability to critique one’s own work, troubleshooting skills, creativity and, most of all, the ability to work well with others are mandatory for healthcare business intelligence work.


Targeting the Right Metrics
Next, select the right metrics. Tailor analytics views to data recipients to be the most effective. Consider how many different definitions can be given to the same data element. For example, discharge time – is it when the patient physically leaves the facility, when the time is keyed into the EHR or when the discharge order was signed? Keep in mind the following:

  1. Understand what data is needed to support a given metric. Some metrics are based on data from one system. Consider percentage of cash collected. To calculate this, you need to know how much total monies were collected in a given time period and which of those monies were cash. While it sounds simple, does “cash” include checks or card payments?
  2. Select metrics defined by a national organization. HFMA has great materials on financial metrics, and other organizations offer definitions for operational metrics and clinical metrics. Using an organization’s definition from a national level will allow you to compare your values to other organizations similar in size and type to your own facility.

Data Selection
When determining source systems, consider how accessible data is, which may depend on its source. Data from a HR system may or may not be updated throughout the day, and that data may not easily match or align with data from your revenue system. Consider data feed schedules, since timely data is critical. Up-to-date data that is equally accurate is the winning combination. Your project team will need to structure testing and validation of selected data and its precise aggregation before presenting the analytics views to a wider audience.

Data Cleansing and Aggregation
Usually, data from different systems is not in the same format. For example, dates are formatted in a combination of ways, but your financial analytics view needs to use one standard way in all its visualizations. Good data aggregation achieves a single unified record made up of data from different systems. Though this sounds simple, most often it is not. The stronger the aggregation process is, the more usability the achieved data set will possess.   

We hope this serve as a helpful starting point for your financial analytics initiatives. Thank you for your time!

Celebrating Most Powerful Women in Health IT


Congratulations to all the Most Powerful Women in Healthcare IT honorees! Its incredible to have been a part of this first-ever event for female leaders in the industry and celebrate all their dedication and achievements.

While the event praised female health IT triumphs, it also shed light on areas for growth. Gender gaps in both career opportunities and pay still exist. HIMSS research found that female health IT workers earn almost 25 percent less than men in the industry, while new female HIT executives within their first year of leadership earn only 63 percent of the pay of male equivalents for the same responsibilities. To learn more about the gender gap in health IT check out Health Data Management’s article here.

So how can women in health IT overcome these statistics? A conference session led by executive coach at Energy Springs Leadership Deb Busser suggested that leadership-seeking individuals cross pollenate their skills and networking. Attend conferences like HIMSS and CHIME Fall Forum for career development and professional relationship building. Stay up-to-date on industry trends and publications, lending your own expertise in guest blog posts or bylines. It can be great industry exposure that promotes you as a thought leader and expert in the field. Push beyond your comfort zone to meet new people, who can build your support network, and opportunities.

Congratulations again, MPWHIT honorees, including Stoltenberg’s own Sheri Stoltenberg. To see the full list of Thought Leader honorees, click here.

Tips for Negotiating with EHR Vendors

Before signing the contract with a new EHR vendor, think about the immediate and future implications on your healthcare organization, end users, workflow, business operations and the patient community. Be willing to consider the following questions when approaching this daunting IT decision:

  1. What is the main goal we are trying to achieve?

    Don’t buy or opt in for additional or added features when you don’t need them for your practice. Additional functionality and available modules can always be negotiated from a pricing standpoint (which you should be able to be lock in for at least two years) as an option exercised at a later date if the scope of the practice changes and there is a need for the additional product. Another thing to remember is, just like cars and furniture, software is always on sale. The level of discount you are able to achieve will depend on a number of factors, including success of the vendor, timing in the quarter or fiscal year and length of agreement you are willing to enter into.

  2. What’s the best way to achieve win-win outcomes in the negotiation with a new EHR vendor?

    Remember that the best executed software agreement is one that both the customer and the vendor feel good about. The goal is for the agreement to be a win-win result. It should provide a quality and supportable product for the medical practice in an agreement that the vendor feels good about to provide the appropriate support. With a win-win agreement, the vendor is much more likely to go the extra mile in assisting the customer when issues arise outside of the normal support process.

    There doesn’t necessarily need to be a bad guy in the negotiating scenario if open and honest communication is on the table during the negotiation process. Both the customer and the vendor are going to having non-negotiable items that they cannot concede on for various reasons. These should be communicated at the appropriate time during the process. Good representation from the right individuals from both a financial and clinical perspective will help to ensure that expectations are communicated for what is required and what the vendor is offering to meet the needs.

  3. What else should you consider when working with a new EHR vendor?

    Reference checks are the key to making this very important decision for your practice. Ask for a minimum of three references and at least one of those references should be a “bad” reference provided by the vendor. Although it may not have necessarily completely been the vendors’ fault for the bad references, it will provide you, the potential customer, with some insight on why that reference failed with the implementation or has not been able to fully utilize the capabilities the vendor is proposing to your healthcare organization. Good references are just that, but take the time to learn as much as possible from them about how they feel they successfully implemented the product. What was their staffing model? How long did the implementation take? Did it stay within the budget parameters? What would they have done differently to make it an even better implementation? Exchange contact information with the good references in hopes of communicating with them further in the future.

Best of luck with your negotiations!

Healthcare Pressures Call for New IT Exec Capabilities

Medicine doctor working with modern computer

When you think about individuals in a hospital c-suite, what characteristics come to mind? Perhaps passion and drive with combined analytical and relational skills? These characteristics unite to meet the needs of today’s patients and industry demands while aiding cross-organizational collaboration. Collaboration is a critical component in leading a complex and integrated healthcare system of care. No longer can separate facets of a healthcare organization operate in individual information silos, and CIOs hold an increasingly important role in connecting a hospital through technology. Considering the building pressures of executives, here are three quick tips for healthcare IT leadership:

Planning for the Future

Healthcare organizations now look to leaders who are seasoned team players, willing to offer up fresh perspectives affecting the whole. While much of the healthcare industry is in flux, looking toward the future may seem difficult. However, long-term strategies are important for executives new to a position or an organization, especially when considering demands to stretch tightening budgets.

Leading by Example

Frontline staff, from check-in to patient visit follow up, play a crucial role in patient satisfaction. With such a significant role, healthcare leaders need to motivate and lead these individuals by example to impact their actions and decisions toward each patient interaction. C-suite leaders should take the time to engage one-on-one when possible with frontline staff. Those who deliver valuable care are incredibly important to the success of a healthcare organization.

In an article by Becker’s Hospital Review, former Modern Healthcare publisher and author/public speaker Chuck Lauer said the following:

“The healthcare field needs new ideas and courageous leaders to make them happen. Leaders must show resolve and a willingness to change if the conditions merit doing so. On the other hand, a leader must also be consistent and mature in their personal behavior. After all, a leader sets the tone of a given organization and if they are not consistent that can often sow the seeds of unrest and stress. Any of those things can be a major component of failure and consequently must be avoided!”

Addressing “No”

By all means do we understand the incredible juggling act that c-suite executives manage in balancing multiple projects, but what happens when stakeholders want an exciting new project that really isn’t within bandwidth? Within the same Becker’s article, Beth Israel Deaconess Medical Center CIO John Halamka shared that “What not to do is as important as what to do, because each of us gets this laundry list of hundreds of things that stakeholders want. The technique I usually use is not to say ‘No.’ ‘No’ is such a negative word, so loaded with emotion. So, I say, ‘Not now.’ My role on the resource side is not to create fear, uncertainty and doubt, but to explain to the board what we need to do.”