The Delaware Valley Accountable Care Organization and the Future of Clinician Payment

The DVACO leadership team has spent the past few weeks delivering substantial bonus checks to physicians who were participating in 2014, our first performance year, in which we received the 9th largest shared savings payout in the country for Medicare Shared Savings Program ACO’s. While this has been the cause of much celebration, I was reminded just today while at a regional CMS meeting that regardless of shared savings achievements, in our next contract cycle (2017-2019) the biggest changes in physician/clinician payment during most of our careers will go into effect and ACO’s are front and center. MACRA, MIPS, APMs- sounds like alphabet soup but these programs will begin to drive as much as 18% differentials in physician payment from Medicare – and as you know, the private payers tend to follow along shortly. In a nutshell, all of the current value-based programs (e.g. PQRS) will transition into clinicians being able to choose one of two tracks. The first, the Merit-based Incentive Payment System (MIPS) is a budget-neutral program in which performance in four domains (quality, care experience, cost efficient episodes of care, and Meaningful Use of Technology) will drive either payment reduction or increase. Doing nothing will likely result in an immediate 4% payment reduction in 2019, transitioning to -9%. The second option is to be a participant in an Alternative Payment Model (APM) like an ACO for a sizable portion of your Medicare business, or in a multipayor APM. In the APM track, a 5% annual bonus is paid, on top of any payments from shared savings. Use of an electronic medical record is mandatory in the...