MedPAC Releases June Report; Includes Suggested Proposals on How to Redesign MIPS and Advanced APMs

This week, the Medicare Payment Advisory Committee (MedPAC) released its annual report to Congress, which includes their ideas, not formal recommendations, for improving the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). In the report, they outline actions to move physicians away from fee-for-service and suggest making “MIPS less attractive” by reducing the non-budget neutral “exceptional performance” fund, which rewards clinicians based on their MIPS scores and instead use the money to fund an asymmetric risk corridor for two-sided risk accountable care organizations (ACOs) that qualify as advanced alternative payment models (A-APM) entities.

MedPAC would also change the 5% incentive payment for clinicians participating in A-APMs by eliminating the threshold and making the incentive payment proportional to clinicians’ A-APM involvement. Lastly, they suggest an alternative model for MIPS where payment rates are reduced by a set percentage and then returned or not, depending on physicians’ performance on quality. These proposals fall outside the scope of the MACRA statute and would require further action by Congress to amend the current law.

MedPAC also wants to change how clinicians are paid for Part B drugs. As we reported previously, they recommended that Medicare develop a market-based program that would be referred to as the Part B Drug Value Program (DVP). Providers would have to voluntarily enroll in the program and use private vendors to negotiate drug prices with manufacturers. This would make it more difficult for physicians, particularly those in small practices and in rural settings, to administer Part B medications in the community, further driving consolidation.

As a reminder, MedPAC is an independent congressional agency established by the Balanced Budget Act of 1997 (P.L. 105-33) to advise the U.S. Congress on issues affecting the Medicare program. This report examines a variety of Medicare payment system issues but has no force of law.