Want to Get Paid More? Take Some Risk.
The ACR Commission on Economics is evaluating the role of risk in expanding alternative payment models.
Practicing radiology is risky. Running a radiology practice is risky, given not only the capital-intensive nature of what we do but the complicated regulatory environment that surrounds us.
In addition, radiology touches almost every aspect of clinical care. This exposes us to risk in the form of quality metrics, which subject our practices even more to scrutiny. But this level of risk is not enough — at least not in the minds of policymakers who want us to assume even greater risk under evolving new payment models. This trend is happening faster than we may realize. The Commission on Economics is evaluating the emergence of risk-based payment models and engaging CMS on the regulations involved.
Risk became a relevant part of the payment landscape with the passage of the Affordable Care Act (ACA). In broad terms, the ACA provided CMS the tools and the larger mandate to replace fee for service with new payment models, such as accountable care organizations (ACOs). In this performance-based risk model, participants (including physicians) may choose to join tracks that require downside risk.
The recent passage of the Medicare Access & CHIP Reauthorization Act (MACRA) has accelerated the role of risk in physician payment. MACRA creates two payment tracks: the merit-based incentive payment system (MIPS) and alternative payment models (APMs). In general, APM participation is more attractive. Physicians who meet the requirements to be recognized as a qualifying participant (QP) are exempt from the complex MIPS scoring system and receive bonuses and higher long-term payments. To qualify, QPs are required to assume more risk.
What do I mean by risk? I mean financial risk. APMs hold providers accountable for the cost and quality of care provided, setting target prices and quality metrics that must be met to receive payment. Not all APMs are the same. Only the APMs that CMS deems "advanced APMs" allow participating physicians to achieve QP status. One important criterion for an APM to be recognized as an advanced APM is that the APM bear "more than nominal financial risk." This amount must be at least 4 percent of the total expenditure targets providers have contracted to manage. Fail, and that becomes the amount we are paying back.
Where does this leave us? Well, we do want to achieve QP status to avoid the overwhelming requirements of MIPS, but how much risk are we willing to take on? In one way, the immediate decision is made for us. To date, very few of CMS' APMs have met the "more than nominal financial risk" standard necessary to qualify as an advanced APM. Therefore, few options are available to us. ACOs are essentially all we have. And within ACOs, we would have to only participate in the tracks, which can include downside risk.
So we have some time, right? Not necessarily. The next wave of APMs is already reaching many of our practices. An emerging framework, the episode payment model (EPM), proposes mechanisms for CMS to create a number of clinical episodes, which will be considered advanced APMs. The EPM framework expands on the Coordinated Care for Joint Replacement (CJR) model, which rolled out last year in 67 metropolitan statistical areas (MSAs, geographical areas used by federal statistical agencies).
The EPM proposal, to be introduced in 98 MSAs, builds on the CJR framework and includes acute myocardial infarction, coronary artery bypass grafts, and surgery for hip/femur fracture treatment. As with the CJR, providers receive one bundled payment for the entire episode and are held responsible for quality and cost. These models qualify as advanced APMs because each includes a track that assumes risk. This risk-based track enables physicians to collaborate with the participating hospital in a way that shares risk, possibly achieving QP status for those physicians. All of us should check the CMS website to see whether our facilities are a part of the EPM.
Risk is becoming an increasingly important component of our payment structure, as more APM opportunities present themselves. The greater role of risk will put more pressure on us to improve our processes, enhance care coordination, and help our health care systems achieve greater efficiency. We have the opportunity to become leaders in this changing paradigm. The ACR Commission on Economics stands ready to inform all stakeholders on the role radiology can assume.
By Ezequiel Silva III, MD, FACR, Chair