Bellevue, WA—Mandated by the Affordable Care Act and first applied on January 1, 2015, to large group practices, the Value Modifier (VM) provides for differential payment to a physician or group of physicians under the Medicare Physician Fee Schedule (PFS), based on the quality of care furnished compared with cost during a performance period.
At the 2015 annual meeting of the National Organization of Rheumatology Managers, Emily L. Graham, Vice President of Regulatory Affairs at Hart Health Strategies in Washington, DC, discussed the specifics of this program, which will involve all groups and practices by 2017.
“The VM is an adjustment made on a per-claim basis to Medicare payments for items and services furnished under PFS,” said Ms Graham. “Depending on how well you perform on quality and cost, you could face a positive, a neutral, or a downward adjustment in certain years.”
As Ms Graham explained, the VM is applied at the Taxpayer Identification Number (TIN) level and pertains to all physicians and certain nonphysician eligible providers (EPs) billing under the TIN who are subject to the VM during the payment year.
“The performance year is always 2 years ahead of time,” she said. “Since we are in 2015 right now, your adjustment will take place in 2017.”
- Quality Measures—For groups with 2 or more EPs, measures are reported through the PQRS (Physician Quality Reporting System) Group Practice Reporting Option selected by the group or through individual PQRS measures reported by at least 50% of the EPs in the group. “There are also some claims-based outcome measures,” said Ms Graham, “but you don’t have the same level of control over these as the PQRS measures.”
- Cost Measures—“When it comes to cost measures, it gets a little more complicated and technical,” Ms Graham explained. “You’re being judged based on total per capita costs and total per capita costs for beneficiaries with certain chronic conditions.” There’s also the Medicare Spending per Beneficiary Measure, which, Graham noted, has been highly problematic. “It’s important to know that all cost measures are payment standardized, risk adjusted, and adjusted for the specialty mix of the EPs in the group,” she added. “There continue to be some problems with these, but at least you’re being judged against your peers, rather than being compared to primary care doctors or ophthalmologists.”
- Small Groups (2 to 9 EPs) and Solos—If your practice does not participate in PQRS, there’s an automatic downward adjustment of 2%. “The good news,” she said, “is that, even though there is a quality-tiering component to it, this will not result in a downward adjustment in 2017. You’ll have another year to clean up your act....Right now you just have to be reporting PQRS in order to avoid a 2017 adjustment.”
- Groups with 10+ EPs—“Unfortunately,” said Ms Graham, “because this program is in its second year, practices are subject to a downward adjustment, not just for failing to report a PQRS, but also under the quality tiering.”
The maximum downward adjustment is –4.0%.
What Should Your Practice Do?
For those practices already participating in PQRS, Ms Graham underscored the importance of downloading the Quality and Resource Use Report from the portal.
“One of the most important things you can do is download your feedback report and do your best to understand it,” she concluded. “Is it easy to read? Absolutely not. Is it easy to download? Absolutely not. But this will give you at least some indication of what things look like for the VM calculation and where you fall in comparison to your peers.”