In April 2015, Congress abolished something called the sustainable growth rate (SGR) — the formula used to calculate Medicare payments to providers — which resulted in gasps of relief from practitioners up and down the country. The brand new Medicare Access and CHIP Reauthorization Act (MACRA) removes the annual threat of doctor payment cuts and guarantees positive reimbursement updates through 2019. On paper, MACRA sounds like good news for physicians. But what does it really mean for patients?
What is MACRA?
After years of squabbles and heated media discussion — “If Congress Can’t Fix SGR, Will it Still Pay to Become a Doctor?” asked Forbes a year ago — MACRA will replace the annual “doc fix” that stabilized Medicare’s funding for more than a decade. Since the social insurance program started in 1965, the federal government has had to decide how much to pay Medicare doctors, and in the years that followed, it all got a bit complicated. In 1997, a new formula, called SGR, calculated funding based on the amount the government spent on Medicare in the 1990s. It worked at the beginning, but, as health care costs increased, doctors were soon getting the short end of the stick.
Since 2003, Congress has decided to keep payments, for the most part, stable. MACRA plans to change all of that. The legislation won’t impact practitioners until 2019, but when it does, patients can expect big changes. Now, hospitals will be rewarded for performance rather than the volume of patients that walk through the doors, and two tracks — Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APM) — will revolutionize the way Medicare doctors get paid. Physicians will need to determine which track provides them with the greatest return without compromising on the quality of care. The changes are happening sooner than you think: performance measures in 2017 will be used to calculate the first payment.Will MACRA cause the end of Medicare? Click To Tweet
Will Doctors Be Paid Less?
MACRA is likely to go one of two ways, and the first scenario spells good news for patients. Now that the SGR has been scrapped, doctors will no longer have to worry about payment cuts, and are more likely to remain in the Medicare and Medicaid programs. What does this mean for patients? Well, more of the same. Doctors will continue in Medicare and provide excellent care for their respective communities.
“The repeal of the SGR provides a more secure environment for physicians to expand and invest in their practices to improve care and lower costs,” said Dr. Nitin Damle when discussing the impact of MACRA on patients at an American College of Physicians event. “These payment models offer opportunities for significant improvement in the quality of care and improved reimbursement to primary care physicians.”
The second scenario is less rosy. MACRA will increase the national debt by a huge $141 billion, and cuts to hospitals and post-acute care providers will compensate for the deficit, states Andria Jacobs, chief operating officer of PCG Software. Doctors, she says, will refuse to take Medicare patients or need more money to continue to offer their services. Elderly workers will end up paying a greater share of the Medicare Part B and D premiums, too. In short, more doctors will drop out of Medicare and patients will face spiraling costs.
“MACRA is better than the sharp-stick-in-the-eye pain the pay cut would have inflicted, but is it a viable solution in the long run?” she asks. “Designed to improve physician payment, MACRA is a step in the right direction, and certainly better than the alternative, but it’s not magic, and it’s not enough.” Health Affairs predicts that some doctors — particularly those averse to change in the healthcare industry — might even take an early retirement as a result of these reforms.
It’s difficult to predict what will happen when MACRA goes live, and patients will just have to wait with bated breath to see if MACRA brings positive or negative changes. Whatever happens, the legislation will provide plenty of time before it’s fully implemented. Then there’s the looming presidential election, something that could impact how much Medicare doctors get paid in the long term. The remaining candidates have polarizing opinions: Hilary Clinton and Bernie Sanders believe Americans should be entitled to health care, while Trump has reservations on the issue. With the upcoming election and the implementation of MACRA, the next few years will see some interesting developments.