On April 14, 2015, the U.S. Senate passed the Medicare Access and Children’s Health Insurance Program Reauthorization Act. (MACRA). The MACRA repeals the flawed Medicare sustainable growth rate (SGR) formula that calculates payment rates to physicians. The law establishes an alternative set of annual payment updates to replace the SGR.The U.S. Department of Health & Human Services (HHS) is counting on MACRA to transform physician payment when it is implemented in 2019 and accelerate movement toward value-based payment in the meantime. HHS has goals to move 30 percent of Medicare payments into alternative payment models by 2016 and 50 percent by the end of 2018.

The law further establishes two payment tracks for physicians that would offer bonuses beginning in 2019 and differing payment updates starting in 2026:

  • One for physicians who participate in an alternative payment model (APM) such as the patient-centered medical home.
  • One for those who stay in fee-for-service and participate in the Merit-Based Incentive Payment System (MIPS).

For more on these programs, collectively known as Quality Payment Programs (QPP), please see our QPP page.

MACRA implements Medicare physician payment reforms that facilitate expanded access, innovation, and quality improvement. The law expands access to care for children and vulnerable populations, and extends the Children’s Health Insurance Program (CHIP), community health centers, National Health Service Corps, and the Teaching Health Centers (THC) programs.

 It is important to prepare now for the upcoming changes to Medicare payment that will begin soon.

Medicare Payment Reform: Making Sense of MACRA” is a must read (March/April issue of Family Practice Management written by Amy Mullins, MD, the AAFP’s medical director of quality improvement) as is the accompanying AAFP News article “AAFP Launches Full-Court Press to Ensure FPs Thrive in New Payment Era.”

What you can do now:
Until the details of regulations emerge, the following are activities you can start immediately to prepare your practice for a profitable transition:

  • If you have not been reporting for the Physician Quality Reporting System (PQRS), it’s time to start.
  • If PQRS is off the table for your practice, you should at least understand how to report quality measures; the AAFP has resources to help.
  • Review your practice’s Quality Resource and Use Reports because they will tell you where you stand in the resource use category—one of four categories that will determine future payments in the Merit-Based Incentive Payment System (MIPS) track (you need to know now if you are a high utilizer of resources because that will count against you).
  • Start evaluating your practice in terms of clinical practice improvement activities—such as access to care, patient engagement, and care coordination—that will be measured when MACRA is implemented.

The American Academy of Family Physicians will soon be launching a comprehensive, multi-year member education and communications effort designed to simplify the transition and provide the guidance you need to realize the benefits of MACRA and value-based payment—stay tuned for details.

You may also wish to familiarize yourself with these changes by accessing the following resources:

AAFP Resources

Additional Resources