[Senate Hearing 114-679]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 114-679

                        MEDICARE ACCESS AND CHIP
                      REAUTHORIZATION ACT OF 2015:
                 ENSURING SUCCESSFUL IMPLEMENTATION OF 
                       PHYSICIAN PAYMENT REFORMS

=======================================================================

                                 HEARING

                               BEFORE THE

                          COMMITTEE ON FINANCE
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 13, 2016

                               __________


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                          COMMITTEE ON FINANCE

                     ORRIN G. HATCH, Utah, Chairman

CHUCK GRASSLEY, Iowa                 RON WYDEN, Oregon
MIKE CRAPO, Idaho                    CHARLES E. SCHUMER, New York
PAT ROBERTS, Kansas                  DEBBIE STABENOW, Michigan
MICHAEL B. ENZI, Wyoming             MARIA CANTWELL, Washington
JOHN CORNYN, Texas                   BILL NELSON, Florida
JOHN THUNE, South Dakota             ROBERT MENENDEZ, New Jersey
RICHARD BURR, North Carolina         THOMAS R. CARPER, Delaware
JOHNNY ISAKSON, Georgia              BENJAMIN L. CARDIN, Maryland
ROB PORTMAN, Ohio                    SHERROD BROWN, Ohio
PATRICK J. TOOMEY, Pennsylvania      MICHAEL F. BENNET, Colorado
DANIEL COATS, Indiana                ROBERT P. CASEY, Jr., Pennsylvania
DEAN HELLER, Nevada                  MARK R. WARNER, Virginia
TIM SCOTT, South Carolina

                     Chris Campbell, Staff Director

              Joshua Sheinkman, Democratic Staff Director

                                  (ii)


                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Hatch, Hon. Orrin G., a U.S. Senator from Utah, chairman, 
  Committee on Finance...........................................     1
Wyden, Hon. Ron, a U.S. Senator from Oregon......................     3
.................................................................

                         ADMINISTRATION WITNESS

Slavitt, Andy, Acting Administrator, Centers for Medicare and 
  Medicaid Services, Department of Health and Human Services, 
  Baltimore, MD..................................................     5

               ALPHABETICAL LISTING AND APPENDIX MATERIAL

Hatch, Hon. Orrin G.:
    Opening statement............................................     1
    Prepared statement...........................................    25
Slavitt, Andy:
    Testimony....................................................     5
    Prepared statement...........................................    26
Wyden, Hon. Ron:
    Opening statement............................................     3
    Prepared statement...........................................    32

                             Communications

Alliance of Specialty Medicine...................................    33
American College of Physicians (ACP).............................    37
American Congress of Obstetricians and Gynecologists (ACOG)......    44
American Hospital Association (AHA)..............................    48
American Society of Plastic Surgeons (ASPS)......................    52
The Docs4PatientCare Foundation..................................    53
Infectious Diseases Society of America (IDSA)....................    57
Medical Group Management Association (MGMA)......................    61

                                 (iii)

 
                        MEDICARE ACCESS AND CHIP
                 REAUTHORIZATION ACT OF 2015: ENSURING
           SUCCESSFUL IMPLEMENTATION OF PHYSICIAN PAYMENT REFORMS

                              ----------                              


                        WEDNESDAY, JULY 13, 2016

                                       U.S. Senate,
                                      Committee on Finance,
                                                    Washington, DC.
    The hearing was convened, pursuant to notice, at 10:06 
a.m., in room SD-215, Dirksen Senate Office Building, Hon. 
Orrin G. Hatch (chairman of the committee) presiding.
    Present: Senators Grassley, Crapo, Cornyn, Thune, Burr, 
Isakson, Portman, Toomey, Heller, Scott, Wyden, Stabenow, 
Nelson, Menendez, Carper, Bennet, Casey, and Warner.
    Also present: Republican Staff: Chris Campbell, Staff 
Director; and Brett Baker, Health Policy Advisor. Democratic 
Staff: Joshua Sheinkman, Staff Director; Michael Evans, General 
Counsel; Elizabeth Jurinka, Chief Health Advisor; and Beth 
Vrabel, Senior Health Counsel.

 OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM 
              UTAH, CHAIRMAN, COMMITTEE ON FINANCE

    The Chairman. I would like to welcome everyone to this 
morning's hearing. Today, the committee will hear from the 
Centers for Medicare and Medicaid Services on its initial 
proposal for implementing the physician payment reforms 
included in the historic Medicare Access and CHIP 
Reauthorization Act of 2015, generally referred to as MACRA.
    I would like to thank Acting Administrator Slavitt for 
appearing today to testify on this important topic.
    The passage of MACRA was a tremendous bipartisan 
achievement that addressed longstanding and recurring problems 
under Medicare. It was, I will note, one of the first of many 
significant bipartisan accomplishments we have seen in the 
114th Congress. Most notably, MACRA eliminated the flawed 
Medicare Sustainable Growth Rate, or SGR, formula.
    As everyone here will recall, the SGR mandated significant 
cuts to Medicare physician payments that were, on a more or 
less yearly basis, averted by legislation to, quote, ``patch'' 
the SGR. Between 2002 and 2014, Congress passed 17 different 
laws to prevent the cuts from taking place. The perpetual SGR 
cycle took up far too much of Congress's time and diverted 
attention from other priorities. Getting rid of the SGR not 
only resolved a vexing problem for lawmakers, it gave security 
to Medicare beneficiaries who often had to wonder if they would 
eventually lose access to their physicians.
    In addition to repealing and replacing the SGR, the MACRA 
law contains structural reforms to the Medicare program, 
including increased means testing for Part B and Part D 
premiums and limits on, quote, ``first dollar'' Medigap 
coverage for new beneficiaries.
    While these structural changes put Medicare on a more solid 
fiscal footing, more needs to be done to ensure the program is 
there for future generations.
    I note these reforms today to reiterate what I have said on 
several occasions. Despite the cries of naysayers, bipartisan 
Medicare reform is possible, and the passage of MACRA proves 
that to be the case.
    I look forward to continuing the discussion on how to shore 
up the Medicare program for the long term. But for today, let 
me turn back to the stated purpose of this hearing, which is 
MACRA's physician payment reforms.
    The physician payment reforms are the result of years of 
effort in the Finance Committee. Working with the House 
committees of jurisdiction, this committee was able to craft a 
legislative solution that garnered the support of nearly every 
national and State physician organization.
    This proved to be key to MACRA's enactment, as previous 
efforts to eliminate the SGR had been stymied by the question 
of what would replace it. These reforms were intended to 
accomplish several things. Our most specific goals were to, 
one, streamline disjointed incentive programs to reduce the 
administrative burden on physicians; two, ensure that metrics 
on which physicians are assessed are relevant to the patients 
they treat; three, provide flexibility to physicians to 
participate in a way that best fits their practice situation; 
and, four, provide an incentive to consider and attempt 
alternative payment models.
    Now, we are here today to discuss and, hopefully, evaluate 
how CMS has proposed to implement the law in order to achieve 
these goals.
    Let me say that I appreciate the extent to which CMS has 
reached out to stakeholders to get their thoughts in advance of 
the proposed rule the agency released in April. I understand 
that CMS continued its outreach during the public comment 
period to ensure that key groups would be informed on the 
proposal and to hear their reactions. Consultation with 
stakeholders, especially beneficiaries and physicians on the 
front lines of providing care is precisely what we sought when 
we drafted the statute.
    I also appreciate the outreach that CMS has undertaken with 
members of Congress and their staffs. Viewing implementation as 
a partnership with Congress is the right way to go. Without 
delving too far into my longstanding concerns about the 
administration's lack of disclosure and cooperation with 
Congress, I say that I wish this model would be used more 
often.
    The CMS proposal that resulted from this consultation and 
outreach is hundreds of pages, and the details matter greatly 
to our physicians and patients. This hearing will give CMS a 
chance to describe its implementation efforts and give members 
of the committee an opportunity to reflect and ask questions on 
issues that are garnering significant comment and public 
discussion.
    It will also allow members to speak to Congress's intent 
with regard to MACRA, share insights, and hopefully get answers 
on the issues that are important to their constituents.
    Before we hear from Mr. Slavitt on CMS's implementation, 
though, I want to flag an important concern that I know is 
shared by others, which is the plight of small and rural 
physician practices. We recognized the inherent challenges of 
these types of practices when we crafted the MACRA statute, and 
I know CMS is aware of these issues, but we need to make sure 
that the law is implemented in a way that works for these 
physicians and ensures that these practice settings remain 
viable options for Medicare beneficiaries.
    So I look forward to a constructive dialogue here today and 
to the committee's continued engagement with CMS through the 
final rule in November and beyond.
    With that, I want to recognize my partner and companion in 
this effort, Senator Wyden, for his opening remarks.
    [The prepared statement of Chairman Hatch appears in the 
appendix.]

             OPENING STATEMENT OF HON. RON WYDEN, 
                   A U.S. SENATOR FROM OREGON

    Senator Wyden. Thank you very much, Mr. Chairman. Thank you 
for scheduling today's hearing.
    It is my view that there are big opportunities ahead to 
make substantial bipartisan progress when it comes to 
protecting and updating the Medicare guarantee, and that is 
what this committee will be discussing this morning.
    The first is to implement the plan to throw in the trash 
can the hopelessly broken, out-of-date Medicare reimbursement 
formula known as the SGR. This was the source of uncertainty 
and frustration for health-care providers and seniors, and it 
has now been sent to the dustbin of history.
    Today, the committee has a chance to talk about how its 
replacement is going to be implemented.
    Second, it is important to build on the new Medicare 
payment system, and, in my view, the obvious place to start is 
in the area of chronic care.
    Seniors suffering from these chronic illnesses, such as 
heart disease, cancer, diabetes, and stroke, now account for 93 
percent of the spending in the Medicare program. I am very glad 
that it is now a bipartisan focus of the committee.
    By finally clearing the decks of the SGR debacle, the 
Finance Committee has been able to get to work on developing 
legislation that will empower families and Medicare to manage 
and treat these debilitating illnesses.
    I would like to especially thank the chairman, Senator 
Warner, and Senator Isakson, who joined me in a special focus 
on this issue. This effort has already begun paying dividends.
    Last Thursday, for example, the Centers for Medicare and 
Medicaid Services proposed to adopt, by rule, four of the 
proposals developed by our chronic care working group. The four 
areas relate to diabetes prevention, care coordination among 
providers, mental health/substance abuse treatment, and 
Alzheimer's care planning, which reflects the special priority 
of our colleague from Michigan, who has done great work with 
respect to Alzheimer's.
    Obviously, there is still an enormous amount of work to be 
done, but I just want to express to my colleagues my 
appreciation for the good work that they have already done, 
which, in my view, has been the spark behind what the Centers 
for Medicare and Medicaid Services proposed last Thursday to do 
by rule.
    Now, when it comes to replacing SGR, Medicare payment 
reform took the important step of engraving into stone the 
principle of rewarding medical care that provides quality over 
quantity. For the seniors who depend on the Medicare guarantee, 
this ought to result in better, more thoughtful care. That is 
the direction health care is headed across the country, and 
Medicare ought to be leading the way.
    I am going to wrap up by just making two quick points with 
respect to implementing the Medicare Access and CHIP 
Reauthorization Act the right way.
    The first is to make sure all doctors who care for older 
people get fair treatment under the new rule. As Chairman Hatch 
and I have noted on many occasions, that is especially true for 
the small or solo practitioners who have always been the 
backbone of rural communities.
    Second, the legislation supports efforts to strengthen 
primary care--which I believe, once again, there has been 
bipartisan support in this committee for--focusing there in 
order to help people to be healthier and to hold down costs. 
For example, the Comprehensive Primary Care Plus model allows 
Medicare to partner with commercial and State health insurance 
plans, so all parties are on the same page when it comes to 
paying for value and quality care.
    What it means is a primary care doctor who has business in 
the commercial market and in Medicare does not have to find a 
balance between a byzantine set of rules as she is trying to 
serve as many people in her community as possible.
    If done right, these kinds of innovative changes to the way 
doctors are paid are going to improve care for seniors in the 
program, and that is, of course, what the reform legislation 
was all about.
    Finally, I would like to thank Mr. Slavitt, Andy Slavitt, 
Acting Administrator of the Centers for Medicare and Medicaid 
Services, for joining the community. He has been committed for 
a long, long time to doing right by the millions of Americans 
who have to navigate our health-care system each day, and we 
very much appreciate his push for more value and quality in 
American health care.
    Thank you very much.
    [The prepared statement of Senator Wyden appears in the 
appendix.]
    The Chairman. Thank you, Senator.
    Now, I would like to take a moment to once again introduce 
today's witness, Acting Administrator Andy Slavitt.
    Mr. Slavitt is the Acting Administrator for the Centers for 
Medicare and Medicaid Services. He is responsible for 
overseeing the coverage of 140 million Americans under 
Medicaid, Medicare, the health insurance marketplace, and the 
children's health insurance programs.
    Prior to joining CMS in July 2014, Mr. Slavitt spent over 2 
decades working in the private sector. Most recently, Mr. 
Slavitt served as group executive vice president for Optum. 
Prior to that and in reverse chronological order, Mr. Slavitt 
served as CEO of OptumInsight, founded HealthAllies and served 
as its CEO, assisted McKinsey and Company as a strategy 
consultant, and, finally, worked as an investment banker for 
Goldman Sachs.
    Mr. Slavitt graduated from the Wharton School and the 
College of Arts and Sciences at the University of Pennsylvania 
and later received his master of business administration from 
the Harvard Business School.
    Mr. Slavitt, please proceed with your opening statement. We 
are happy to have you here, and we welcome you to the 
committee.

 STATEMENT OF ANDY SLAVITT, ACTING ADMINISTRATOR, CENTERS FOR 
MEDICARE AND MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN 
                    SERVICES, BALTIMORE, MD

    Mr. Slavitt. Thank you. Good morning, Chairman Hatch, 
Ranking Member Wyden, and members of the committee. Thank you 
for the opportunity to discuss CMS's work to implement the 
bipartisan Medicare Access and CHIP Reauthorization Act of 
2015.
    We greatly appreciate your leadership in passing this 
important law, which gives us a significant opportunity to move 
away from the annual uncertainty created by the Sustainable 
Growth Rate to a new system that promotes quality, coordinated 
care for patients and sets the Medicare program on a more 
sustainable path. You will hear this morning that we remain 
open to alternative approaches that achieve these objectives.
    Thanks to Congress, MACRA offers a new approach where every 
physician and clinician will have the opportunity to be paid 
more for providing higher-quality care for their patients.
    In recognition of the diversity of the different practices, 
Congress created two paths. The first allows physicians and 
other clinicians to participate in a single simplified program 
with lower reporting burden and new flexibility in delivering 
quality care. The second recognizes the physicians and 
clinicians who choose to take a further step toward care 
coordination by participating in more advanced approaches, like 
medical homes.
    Our approach to this implementation rests on the belief 
that physicians and their care teams know best how to provide 
high-quality care to our beneficiaries, and we have taken an 
unprecedented effort to draft a proposal that is based directly 
on input from those on the front line of care delivery, and we 
continue this dialogue with physicians and clinicians to help 
us understand how the changes we are proposing may positively 
impact care and allow us to reduce unnecessary burden.
    In over 200 sessions throughout the country, we met with 
64,000 attendees and have received nearly 4,000 formal comments 
from a wide range of stakeholders, demonstrating, I believe, 
the deep level of engagement from patients, physicians, and 
other clinicians in working with us to build a system that is 
more supportive of good patient care.
    We have learned a lot in that process and continue to 
engage directly with front-line physicians and patients.
    I will now review five of the bigger themes that we 
received input on.
    First, we must make the patient the focus throughout this 
program. Patients want to see policies that allow them to 
participate in the overall vision of improving and coordinating 
their care. Physicians want to see a program that supports them 
in patient care, not a new compliance program. This committee's 
leadership, in particular your focus on how we can best care 
for those with multiple chronic conditions, as Senator Wyden 
has discussed, has been instrumental in guiding us.
    Second, we need to simplify the program and reduce burden 
wherever and whenever possible so that physicians can focus on 
patient care, not on reporting or scorekeeping.
    Third, as new advanced approaches, like medical homes, are 
established, we need to create pathways so that more and more 
physicians and other clinicians can participate in these 
models. We will continue to work with the physician community 
to create more opportunities for physicians to participate in 
tailored programs, like our recently announced oncology care 
model, which provides a holistic coordinated approach to 
supporting cancer treatment.
    Fourth, we must design the program with special 
consideration, as Chairman Hatch has said, for small and solo 
independent practices. Small practices do not have the 
resources that the large health systems do, and each new 
administrative requirement takes time away from patient care.
    Fifth and finally, commenters asked us to consider what 
flexibility we have to allow the physician and clinician 
community time to learn and prepare for these changes. While 
the quality payment program builds on programs that should be 
familiar to clinicians, such as the existing quality reporting 
system, we understand that the new rules require adjustment and 
preparation.
    All of this input serves as a valuable guide as we 
determine what adjustments are necessary in the final rule we 
will release this year. We should acknowledge that physicians 
have many frustrations and challenges with the current health-
care delivery system, and implementation of this law will not 
resolve them overnight.
    We will continue to need real and direct feedback from 
physicians, clinicians, and beneficiaries, and from you and the 
rest of Congress, on what is working and what should be 
adjusted. The launch of this program is only the first step of 
a larger process.
    I will close by saying I have had the privilege of serving 
as CMS's Acting Administrator as we celebrated the 50th 
anniversary of Medicare and Medicaid last year, and I believe 
that the foundations we are laying over the next several years 
with the new patient-centered payment system will help set a 
sustainable, higher-quality path for the next 50 years of 
Medicare beneficiaries.
    That is our clear focus in our implementation of MACRA, but 
it will take continued work and high levels of engagement to 
get it right.
    I look forward to your perspectives about our 
implementation and to answering your questions.
    Thank you.
    [The prepared statement of Mr. Slavitt appears in the 
appendix.]
    The Chairman. Thank you, Mr. Slavitt.
    Physicians are concerned that they will not have enough 
time to prepare to effectively participate in the new MACRA 
incentive payment program when it starts on January 1, 2017.
    Assuming that CMS releases their final incentive program 
rule around November 1st, physicians would only have about 2 
months before the program goes live.
    I am sure there are pros and cons to any such start date, 
but this seems to be, to me at least, a legitimate concern. 
Considering that the MACRA law does give CMS flexibility as to 
the start of the physicians reporting period, what options is 
CMS considering to make sure this new program gets started on 
the right foot?
    Mr. Slavitt. You are exactly right. I want to begin where 
you ended. We need to launch this program so it begins on the 
right foot. That means that every physician in the country 
needs to feel like they are set up for success.
    So this has been a significant source of feedback we have 
received as well, and I would start by saying we remain open to 
multiple approaches.
    Some of the things that are on the table--and we are 
considering including alternative start dates--are looking at 
whether shorter periods could be used and finding other ways 
for physicians to get experience with the program before the 
impact of it really hits them.
    The Chairman. Your statement describes four principles that 
guide the agency's implementation of the MACRA physician 
payment reforms. While I agree with all four, I want to 
highlight one here.
    To paraphrase, you state that financial incentives should 
work in the background and that the focus must be on patients 
and not measurement. Now, this principle is consistent with one 
of the main tenets of the MACRA reform: the streamlining of 
disjointed programs for the disposition of administrative 
burdens.
    CMS has proposed a number of good steps to eliminate 
redundancy, but I personally believe more needs to be done.
    Can you describe opportunities for improvement in this area 
to ensure that these programs support rather than detract from 
patient care?
    Mr. Slavitt. I think we all have a shared national goal to 
simplify the health-care system, because there are really only 
two tasks that physicians have to do every day. They are either 
seeing patients, or they are doing some form of paperwork.
    So the less time we can have them focused on the latter, 
the more time they will have to take care of the people who 
really need to be taken care of.
    MACRA, as you have said, takes a big step in this direction 
by taking three disjointed programs and streamlining them into 
a single program. So even at the outset, there are some gains 
for physicians.
    But it is a long journey to continue to simplify the 
health-care system, and we have solicited a lot of input in 
this area and we are open to lots of ideas, such as figuring 
out how to reduce the need for reporting at all. We have some 
categories where we can get automatic data feeds from 
physicians and do not need to ask them to report.
    There are other areas where we know physicians are 
performing well, so we do not need to have them report on this 
at all.
    We are looking at areas where we can exempt physicians or 
look at thresholds for physicians who do not see lots of 
Medicare patients.
    So there are a variety of ideas that have been coming to 
us, and they are all really on the table at this point.
    The Chairman. Thank you. As I said in my opening statement, 
I commend CMS for reaching out to stakeholders and members of 
Congress as the agency crafted this initial proposal to 
implement the MACRA physician payment reforms.
    Now, such an inclusive approach is consistent with the 
intent of the MACRA statute. I would also reiterate my 
statement that we all need to work together on a continued 
basis to ensure that implementation works for physicians and 
beneficiaries.
    My view is that this will be a multiyear process, and, 
while we expect to see improvements from the proposed rule to 
the final policy for 2017, there will be an ongoing need for 
refinement. One step that CMS could take to ensure the 
continuation of the iterative dialogue is to publish an interim 
final rule this fall.
    What is the plan to ensure that CMS is best positioned to 
improve the programs on an ongoing basis?
    Mr. Slavitt. I think that option, as well as other options, 
are on the table for us to consider as we continue to keep the 
feedback process open.
    We know that this is a long-term process. We know that we 
are only taking the first steps in the first years of 
implementation. So we have to have processes that allow 
physicians to continue to provide feedback to us.
    From our perspective, CMS needs to really shorten the 
window and close the gap between the actual practice of 
medicine and policy implementation. That really is our job, and 
I think this process has allowed us to get closer to that.
    The Chairman. Thank you. My time is up.
    Senator Wyden?
    Senator Wyden. Thank you, Mr. Chairman.
    Mr. Slavitt, of course, what our committee has learned is 
that this is not our grandfather's Medicare program. Back when 
I was with the Gray Panthers, we talked about Medicare when 
somebody had a broken ankle or a really bad case of the flu. 
Today, it is about chronic illness.
    I noted 93 percent of the Medicare spending deals with 
chronic illness, and 75 percent--75 percent--deals with seniors 
who have four or more chronic illnesses.
    Let us begin by getting your take on how the new MACRA law 
would begin to start paying benefits for older people. I have 
already described how going on to the next stage is something 
that has been a priority for this committee, and we put it in 
the context of this proposed rule that you announced last 
Thursday.
    But let us talk specifically about the law that has been 
adopted by the Congress. How do you envision it dealing with 
those seniors who generate 75 percent of the spend and have 
four or more chronic illnesses?
    Mr. Slavitt. Thank you, Senator Wyden.
    Those statistics that you quoted and that you have 
continued to remind us of over the years really ground us and 
need to ground us in the implementation of both MACRA, as well 
as, as you just covered, some of the other policy work that we 
are doing.
    New approaches to payment must emphasize the ability to 
coordinate care for people who have multiple chronic conditions 
and give physicians time to do that, and that needs to really 
be part and parcel of every one of the advanced models that we 
put forward.
    We recognize that, as you say, the breadth of this issue 
extends even beyond MACRA, and your longstanding leadership has 
been instrumental to us, along with Chairman Hatch, in guiding 
our principles here.
    I would also add that the bipartisan working group chaired 
by Senators Isakson and Warner has done the same as well, and I 
thank them.
    I think we can point to some recent successes in this area. 
We have recently announced that we are going to be scaling the 
prevention of diabetes. We have launched an oncology care model 
for the treatment of cancer patients, which is directly a part 
of the MACRA implementation.
    We have a proposal now to better care for individuals 
living with dementia, which I know has been a longstanding 
commitment and priority of Senator Stabenow. And of course, 
behavioral health and coordinated care become a part of all of 
these pieces.
    So really we have to bake this into the fabric of every 
element of the models that are available to physicians under 
the MACRA law, because as you say, we are not dealing with 
people who are jogging and breaking an ankle. That is not the 
burden on the Medicare program. The burden is helping people 
who live with multiple chronic conditions.
    Obviously, there are limits to what we can do 
administratively, and we know you have other areas of focus and 
ideas, such as expanding the independent home model.
    So we stand ready to work with you in all of these efforts.
    Senator Wyden. Let me ask a question about the small 
practices and the opportunity to really deal with the burden 
and the complexity that the small practices and practitioners 
bring to every single member of this committee.
    I can just tell you, having talked to virtually all of the 
members with respect to what they hear when they are home, this 
is what comes up constantly with respect to the complexity and 
the burden.
    You all have proposed creating virtual groups--virtual 
groups that would allow individual physicians to report 
together. In effect, it might be a low volume threshold, and 
then these providers in rural areas could report together. That 
strikes me as pretty promising stuff.
    Now, there are a lot of pieces to the puzzle, because we 
have to make sure that they have good broadband connections and 
the like.
    But tell me a little bit about how you envision that 
working, particularly giving the flexibility to these small 
practices that they are asking for and that I think is in the 
spirit of your proposal.
    Mr. Slavitt. Yes. Thank you for asking that question, 
because the focus on small, independent practices and their 
ability to continue to practice independently is a very high 
priority for us. And I would add, it is not just small 
practices. It is also any physician who practices in a rural 
location. They have a very different set of dynamics than other 
physicians do, and many of our beneficiaries, of course, live 
in those areas.
    So we need every physician to be set up for success, and 
the challenges in small practices are far greater. Oftentimes, 
in a small practice, you will find it is a physician and his or 
her spouse and that is it. That is all the work that they do. 
So if we add additional paperwork, that paperwork comes out 
directly from patient care.
    So there are a number of areas where we receive feedback in 
talking with small practices and visiting directly with small 
practices, including, how do we compare the performance and 
evaluate the performance of small physicians; how do we lessen 
the reporting burden; how do we look at things like thresholds, 
as you said.
    We have solicited direct feedback on what the best way to 
create virtual groups might be. So we remain very open in this 
area. We think there are a number of steps that are available 
to us, and we will continue to seek input in this area.
    The Chairman. Senator Stabenow?
    Senator Stabenow. Thank you very much, Mr. Chairman and 
Ranking Member, for a very important hearing
    Welcome, Mr. Slavitt. It is great to have you with us.
    First, just a couple of comments. One, I want to thank you, 
as I have done privately, for working with us and coming 
forward with a number of proposals, certainly behavioral health 
being incredibly important. But as it relates to dementia and 
Alzheimer's, focusing on caregivers and being able to create a 
system for payment incentives around caregiver planning 
sessions is really, really important and is based on what we 
have been working on, bipartisan legislation, for a number of 
years, called the HOPE for Alzheimer's Act.
    So we are very, very pleased that we have 57 members of the 
Senate as cosponsors of this. So it is something that I am 
anxious to work with you on as you move through the comment 
period and so on, to be able to get this into practice as soon 
as possible.
    The other thing I want to mention as well, more of a 
concern, is the home health demonstration project. Continue to 
monitor that closely in terms of whatever is done, increasing 
accountability to make sure it does not get in the way of 
people being able to get home health care, which is critically 
important.
    The issue today, MACRA, is really a historic piece of 
legislation. We all want very much for people to receive the 
best health care possible, and we know that a health-care 
payment system that rewards doctors for doing their job also 
improves patient outcomes and saves taxpayer money. It is a 
win-win, providing quality patient-centered care; we know that.
    So the question is, how do we get there? We also know the 
current fee-for-service model is outdated and less effective 
than a value-based outcomes-oriented approach. But I also know 
that if we surveyed everyone in the room, we would have 
different ideas of what that meant, which is the challenge, I 
think, for you and for all of us going forward.
    But if we get it right with innovative approaches, we are 
actually going to see patient outcomes and quality care go up 
and costs go down. So it is important for doctors and seniors 
and families and communities and hospitals and providers.
    I want to ask for your comments on a couple of specific 
issues, though, that I am hearing about from providers in 
Michigan. They dovetail with what the chairman and ranking 
member have talked about.
    The first one is electronic health records. As we talk 
about small practices, as we talk about rural communities, like 
in northern Michigan and the upper peninsula of Michigan, that 
may not have access to the technologies that APMs or the MIPS 
program require, we know that in order for doctors to 
participate in Alternative Payment Models to coordinate care, 
it is really important that electronic health records be easy 
and quickly able to operate, to be able to do what needs to be 
done. Interoperability is critically important.
    So what is CMS doing to make sure rural providers are able 
to fully engage in these two models we are talking about: the 
MIPS--the fee-for-service--and the Alternative Payment Models 
reimbursement tracks, given their restrictions, especially as 
it relates to electronic health records?
    Mr. Slavitt. Thank you, Senator Stabenow. The good news, I 
think, for all of us as a country, compared to where we sat 5 
or 6 years ago, is today over 70 percent of physician practices 
have electronic medical record technology in their office and 
virtually all hospitals do today.
    That is a significant step forward. However, we have more 
work to do in that those electronic medical records, by most 
reports, are not yet easy to operate and they are not yet able 
to move information back and forth between one physician and 
another or a physician and a hospital when a patient moves, and 
that makes it much more difficult.
    So we have attempted to focus in a couple of areas here. 
First is really to lessen the requirements, and particularly 
the requirements on the types of physicians that you refer to, 
in terms of complying with the program that allows them to 
qualify for use of electronic medical records.
    We have increased flexibility. We have lessened the burden. 
We have created more options, and we think that is going to be 
helpful.
    We have also focused virtually all of the measures now on 
interoperability; that is, the ability of a technology to move 
data between one system and another. Everyone has a role to 
play in that. The vendors have to comply with this, and we 
think that is going to ultimately be very beneficial to the 
physicians.
    Senator Stabenow. But I would just indicate that 10-12 
years ago, as we were first talking about this--and I was very 
involved in establishing this--I was very concerned there was 
not one standard on interoperability at the time, because I 
think it has added to the challenges that people have right 
now.
    Let me----
    The Chairman. Senator, your time is up.
    Senator Stabenow. Thank you, Mr. Chairman.
    The Chairman. Senator Thune?
    Senator Thune. Thank you, Mr. Chairman.
    Mr. Slavitt, I want to come back for a minute to the issue 
of virtual groups and talk a little bit about the timeline for 
that.
    I am disappointed that the final rule punts this decision 
for another year, since the proposed rule indicates that 
clinicians would have to elect to be in a virtual group by June 
30th of the year before.
    Could you provide us with a time frame for when CMS plans 
to issue a proposed rule on these groups?
    Mr. Slavitt. Thank you, Senator.
    Virtual groups is an area that, going all the way back to 
January, we have solicited feedback from physicians on 
concerning how that might work, because we do agree with you 
that it is a concept that has a lot of promise and a lot of 
potential. But because it is a new concept, there are a lot of 
details to work out, and we want to make sure that when we 
launch it, we launch it right.
    So in the first year, I think we have the opportunity to 
launch a number of things that are helpful to small practices, 
some of which I have talked about, including reporting 
thresholds, including things that make it easier to report, 
some performance improvements, and so forth, while we continue 
to work with physician groups on the launch of virtual groups.
    I think you are right. I think this is going to be a high 
priority for us, and I think it is going to be something that 
is going to need a lot more input from physicians to make sure 
we get it right.
    Senator Thune. Could you maybe specifically identify what 
issues and barriers CMS has identified that are prohibiting 
these groups from going live next year and how it plans to 
overcome them next year?
    Mr. Slavitt. It is just a whole new way of reporting, and 
we need to make a number of decisions--and physicians would 
need to make a number of decisions, and they are not yet used 
to practicing that way.
    So we have asked physicians, ``How might you want to go 
about this?'' and we have gotten a lot of the sense that, yes, 
this has promise, but we have to be able to make a whole lot of 
decisions, let alone implement the operations and the 
technology to support them.
    So I do not think this is something that cannot be solved 
with just a little bit more time, but it is certainly not 
something that is ready to be launched in 10 months.
    Senator Thune. Can you give us some sort of time frame, 
though, when it might go live?
    Mr. Slavitt. I think our aim would be to get it done within 
the following year. That would be our aim. I want to make sure 
we do everything we can to get it right and get the feedback.
    The thing I want to also make sure to convey is the reason 
why virtual groups are important. We think we are going to be 
able to get them to small practices in the first year through 
other means as well.
    Senator Thune. I want to turn now to the issue of a low 
volume threshold. Being from a rural state, I am always 
contemplating how changes to reimbursement are going to impact 
rural providers.
    The proposed rule attempts to create a low volume 
threshold, but I am not quite sure it provides enough 
flexibility.
    Clinicians eligible for the exemption must have Medicare 
billing charges of less than or equal to $10,000 and provide 
care for 100 or fewer beneficiaries. This dual requirement 
seems especially low, especially the $10,000 threshold.
    The question is, is there anything else that CMS can do to 
ensure that rural providers have access to a meaningful low 
volume threshold exemption?
    Mr. Slavitt. Yes, Senator, that is an area where we have 
received a lot of particular input. I think a lot of people 
feel that the $10,000 number is too low. So we are currently 
looking at that--that is very much on the table--to figure out 
what is the right way to define that threshold.
    But certainly, at some point, the juice has to be worth the 
squeeze, and if a physician is not seeing enough Medicare 
patients for this program to be meaningful, we should not 
require them to go through the process.
    Senator Thune. The recent Medicare trustees' report 
estimates that the Independent Payment Advisory Board, or IPAB, 
is going to be triggered in 2017 with implementation of these 
cuts required in 2019.
    How do you think that is going to impact MACRA 
implementation?
    Mr. Slavitt. I cannot speculate on that yet, because I 
think we have not triggered IPAB, as you know, this year. So I 
think that that is something that the next Secretary will face, 
if they are in that position next year.
    Senator Thune. Would you support repealing IPAB to protect 
providers and beneficiaries who would be faced with these 
arbitrary cuts?
    Mr. Slavitt. No. I do not think that is the administration 
position on IPAB.
    Senator Thune. I know it is not the administration's 
position.
    Mr. Slavitt. Thank you. [Laughter.]
    Senator Thune. As you know, there is going to be a new one 
coming in, though. You could kind of go solo now, go rogue, and 
actually give us your opinion.
    Thank you, Mr. Chairman.
    Mr. Slavitt. Thank you, Senator.
    The Chairman. Thank you, Senator.
    Senator Menendez?
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you, Mr. Slavitt, for coming before the committee.
    Let me say, thankfully, the days of being on the SGR doc 
fix merry-go-round are behind us, and I, for one, want to make 
sure that we do not find ourselves in the same position again, 
a position that requires regular congressional intervention to 
maintain consistency in Medicare payments and, ultimately, 
consistency in access to care for seniors.
    So with MACRA, we have a great potential to change the 
paradigm around both payments and practice design with the 
establishment of the alternative payment methods.
    These models could ultimately end the fee-for-service model 
once and for all, leading to a purely quality- and value-based 
reimbursement system. However, to fully realize this goal 
requires a substantial number of physicians moving into these 
alternative practices and taking on some financial risks 
associated with their quality resource use and outcomes.
    While this two-sided risk provides a serious incentive to 
achieve high quality, it is unclear how many physicians will 
actually choose or have the ability to move their practice into 
an advanced APM.
    We have recently seen that this type of two-sided risk 
arrangement has not had a lot of uptake--like the two-sided ACO 
models, which have less than enthusiastic enrollment.
    So what analysis has been done to take into consideration 
providers' willingness or ability to move into two-sided risk 
Alternative Payment Models in the near term, or, in another 
sense, how many practices will, in essence, forego even trying 
to get into an APM and just maintain fee-for-service through 
the MIPS program in perpetuity?
    Mr. Slavitt. Thank you, Senator. As you point out, we are 
on the beginning of a journey to move toward a new set of 
models that allow physicians more freedom to practice more 
coordinated care, more team-based care, and give them the 
flexibility to get rewarded for quality.
    I think it is important to remind all of us that we are 
very much in the early years of these programs, with just, I 
think, the first and second generation models out today.
    But the good news is, we are beginning to see these 
approaches begin to work. We are seeing physicians increasingly 
move into two-sided risk models. I do think we have to be 
thoughtful and judicious about how we define two-sided risk, so 
that it is not so intimidating to physicians, and make it 
available to more physicians to join, which I think is your 
suggestion.
    Over the next several years, I think it is our task to work 
with the PTAC, which is the physician advisory committee that 
has been set up by the Congress, to get more and more models so 
there are more and more options, such as our oncology model for 
cancer and other specialties across the spectrum.
    We have received meaningful feedback on this topic, both on 
how to judge qualifications for more than nominal risk, as well 
as how to get more advanced models in, and that is currently a 
focus.
    Senator Menendez. Can you quantify that for me at this 
point?
    Mr. Slavitt. Can I quantify----
    Senator Menendez. The number of physicians who are actually 
beginning to move in this direction.
    Mr. Slavitt. Yes, and I think I can get you a more precise 
number. But if I look at our largest population-based model, 
which is called the ACO, I think we have 20 percent to a 
quarter of those that are now in two-sided risk models, up from 
a much lower number a year ago.
    I am not sure that is the precise number, and I will follow 
up with you. But that is pretty encouraging.
    Senator Menendez. What other major changes to physician 
practices, like the proposed Part B drug payment demonstration, 
factored into the analysis that you have done about the 
potential here?
    Mr. Slavitt. Your question is, what has the Part B 
demonstration----
    Senator Menendez. What other major changes to physician 
practices, like, for example, the proposed Part B drug payment 
demonstration, factor into your view as to how the acceptance 
is going to be among physicians in this regard?
    Mr. Slavitt. I think there are two things. One is, I think 
we will have a number of, and we will continue to have a number 
of, limited demonstrations that come out of our Centers for 
Medicare and Medicaid Services, because part of what we are 
tasked with is figuring out what works and can be expanded upon 
and what does not.
    So that will continue to go on, and I think we will 
ultimately create models and approaches that will allow us to 
offer new, advanced Alternative Payment Models.
    At the same time, I think we have to also be conscious of 
the fact that we are putting an awful lot of change into the 
system and on physician practices, and too much change on top 
of an already-
burdened physician practice is just not where we should be 
going.
    One of the reasons we are interacting so heavily with the 
physician community and the patient community is to reduce the 
burden at the same time that we are working through some of 
these changes, and then to modulate these changes in ways that 
really make sense to physicians so they can support the 
patient.
    I think it is very important for all of us not to get 
wrapped around the axle with these models and so forth. What we 
have to continue to be focused on is the physician and the 
patient and that these models need to work in the background so 
that the physician can be successful.
    The Chairman. Senator, your time is up.
    Senator Isakson?
    Senator Isakson. Thank you, Mr. Chairman.
    Mr. Slavitt, I want to thank you for two things. One, first 
of all, Senator Warner and I worked very much on care planning 
for a couple years, and I want to compliment CMS on creating a 
code and reimbursement for care planning, reimbursement for 
physicians working with seniors to plan the kind of treatment 
they want when they are capable of making those type of plans. 
That was a great move on your part, and I appreciate your doing 
it very much.
    Also, on the chronic care working group, Senator Wyden and 
Senator Hatch have been tremendously supportive of what Senator 
Warner and I have been doing on care planning. As you know, we 
have had 1,300 inputs now from stakeholders. We are about 18 
months into that process, and we are at the point where CMS and 
CBO are working together to come up with the scores that are 
necessary for us to finish the product.
    About 10 days ago, Senator Warner and I met with the staff, 
who told us there were some difficulties getting a type of 
information from CMS to CBO to get the final scoring done. But 
I understand in the last 10 days, you all have done yeomen's 
work doing that. I wanted to thank you for that and hope you 
will continue to do so, because it is critical that we get that 
score so we can finish that paperwork.
    Mr. Slavitt. Yes, we agree. And I think our staff has been 
very engaged in that.
    Senator Isakson. Thank them, if you will.
    Mr. Slavitt. I will, yes.
    Senator Isakson. I was going to ask you a question about 
small and rural practices, but if I am correct, every single 
member, except Senator Menendez, has asked you that question, 
and every time you have responded that you are aware of the 
problem.
    So let me just say on behalf of the Medical Association of 
Georgia and all the rural doctors we have outside Atlanta, 
anything you can do to help make this MACRA less burdensome for 
them will be greatly appreciated.
    Mr. Slavitt. Yes, Senator, absolutely.
    Senator Isakson. I guess last, let me just say this. Under 
the framework of the proposed MACRA rule, 87 percent of solo 
physician practices face negative payment adjustments in 2019, 
the first year of the merit-based incentive payment system, or 
MIPS. Ending the cycle of possible Medicare premium cuts and 
uncertainty in Medicare, which we accomplished by doing away 
with SGR, was the goal of doing this.
    The intent of the law was not to penalize physicians simply 
because of being in a small practice or being in a certain 
specialty, but MIPS was designed because CMS, at this point, 
just seems to do that.
    What are you doing to try to neutralize that effect?
    Mr. Slavitt. Thank you. And that would not be an acceptable 
outcome. What we have learned are a couple things. One is that 
physicians in small and rural practices, when they report, can 
do equally as well as larger-sized, mid-sized practices.
    So that is the good news. I think what that tells us is 
that we have to make the process of reporting easier. It is 
relatively easy for large practices to report because they have 
large staffs. So we have to make it much simpler for smaller 
practices to be able to report.
    We have a number of ideas for being able to do that, some 
of which include being able to get information automatically, 
some of which will allow us to work with places where 
physicians are already submitting data, for example, to a 
clinical registry, and just take that data from that registry.
    So the aim is to not require a whole lot of paperwork and 
data entry from physicians so they can focus on patient care.
    I think if we do that--and the evidence has begun to show, 
as physicians are able to report more, we are seeing that they 
are not getting penalized. So over this comment period, we are 
continuing to work through those ideas.
    Senator Isakson. Thank you for the answer, but, in 
particular, thank you for the support on what we are trying to 
do on chronic care. We appreciate your cooperation.
    Senator Menendez. Would the Senator yield just for a 
moment?
    Senator Isakson. Certainly.
    Senator Menendez. I would be happy to invite my dear friend 
and colleague to southwestern New Jersey, where we have 
cranberry bogs, peach orchards, blueberries, and there are 
rural parts of the State. So we have a concern that I share 
with you in that regard.
    Senator Isakson. And it is prettier than Newark, I can tell 
you that. [Laughter.] Rural New Jersey is fantastic; I love it.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Casey?
    Senator Casey. Thank you, Mr. Chairman.
    Mr. Chairman, you know how many counties in Pennsylvania 
are considered rural counties, with your roots in western 
Pennsylvania. So let me add my voice to those concerns that 
were raised.
    I want to focus on one primary topic, though, for my one or 
two questions--socioeconomic status, so-called SES, of 
beneficiaries.
    We are talking about low-income folks and the quality 
rating impact that those folks have when those beneficiaries 
are accounted for, the impact a high number of low-SES 
beneficiaries would have on quality ratings.
    I just want to read some of your testimony. On page 4, you 
outline four principles that will guide implementation. The 
second principle indicates as follows: ``Success will come from 
adopting approaches that can be driven by a physician practice. 
Quality measures need to accurately reflect the needs of a 
diverse range of patient populations and practice types and 
give physicians and other clinicians the opportunity to select 
elements of the program in measures that are right for their 
practice.''
    So a diverse range of patient populations and practice 
types and a focus on what would be right for their practice.
    My basic question, with that predicate of your principles, 
focusing on low-SES beneficiaries, is what steps have you taken 
to help practices that treat a high number of these 
beneficiaries achieve both fair and accurate quality ratings?
    Mr. Slavitt. Thank you, Senator. You point to an important 
priority for the agency, which is that the Medicare program's 
biggest challenges are not 67-year-old joggers with three 
Fitbits. They are people who live two bus stops away from their 
dialysis appointment and have, as we talked about this morning, 
four chronic conditions.
    So it is very important to us to make sure we support the 
physician who wants to treat those patients. We know that that 
is a harder challenge.
    So in everything we do, we have to figure out how to 
account for that. Now, it is complicated, because there is no 
straightforward way to do it always, but we just completed, I 
think, a very significant piece of work in the Medicare 
Advantage program to adjust how the Medicare Advantage program 
pays so that we can essentially reimburse higher for taking 
care of people in exactly the kind of situations that you 
talked about.
    We have to continue to make that march happen across the 
entirety of the program. One vital step which is part of MACRA 
is simply to do risk adjustment, which means that if two 
patients come to see a physician and one of them has four 
chronic conditions, that there will be a higher reimbursement 
in acknowledgement of the fact that that is a more complex 
situation.
    That is baked into elements of MACRA. Do I think there is 
more we can do? Yes. I think as we learn more and as we 
understand more how these models work, we will be able to do 
that.
    We have a piece of work, a study that is being completed in 
September around this very topic, coming out of the Assistant 
Secretary for Planning and Evaluation's office. I am eagerly 
awaiting that report, because I think we can incorporate those 
themes into this and other pieces of our work.
    Senator Casey. I appreciate that. I have been working for a 
long time with Senator Portman on this. So we are grateful for 
that work.
    Let me end just by putting in a little bit of a commercial, 
a commendation for the State Children's Health Insurance 
Program, which we know here by the acronym S-CHIP. But it is 
one of the most successful programs of any kind, not just 
health-care programs, in our Nation's history--160,000 
Pennsylvanian's were approaching the quarter-century mark in 
our State for S-CHIP.
    So I know you place a heavy emphasis on that program, and I 
just urge you to keep doing that. We can follow up with 
something for the record on the Children's Health Insurance 
Program.
    Thank you very much for your work.
    Mr. Slavitt. Thank you, Senator.
    The Chairman. Senator Warner?
    Senator Warner. Thank you, Mr. Chairman.
    Thank you for your good work on MACRA, Mr. Slavitt. It is 
good to see you again.
    The goals of MACRA are great. The complexity of getting it 
right is going to be an enormous challenge, and I commend you 
for your work so far.
    I want to, first of all, follow up on a couple comments 
that my friend, Senator Isakson, made. He is a real gentleman, 
and he has been a great partner on a number of these projects.
    I would like to nudge you a little more. The chairman and 
the ranking member and Senator Isakson and I have been really 
aggressively working on this chronic care package. We all know 
the data. Over 90 percent of the Medicare costs arise from 
these chronic care patients.
    The challenge, if we are going to move this legislation, 
hopefully in the early fall, is to get this scoring done, and 
my hope is--you do not have to say it to me right now--that you 
can get us a timeline on when we would get that scoring 
completed so I can share it with the chairman and the ranking 
member, because the chairman has expressed great interest in 
moving forward on this as well.
    So if I can get back to you in the next 24 hours and you 
can get me some feedback on when that scoring will be done, I 
would appreciate it.
    Mr. Slavitt. You have our commitment on that.
    Senator Warner. Thank you.
    I also want to echo what Senator Isakson said on an issue 
that I have been involved with since back when I was Governor, 
and that is the whole question of advanced care planning.
    Obviously, this is a challenge every family goes through. I 
think, candidly, the public is way ahead of the elected 
officials on sorting through this, and, again, I want to 
commend you for putting in a CMS code on that kind of consult.
    Senator Isakson and I have an Advanced Care Planning Act 
that would move beyond that in terms of moving into this field 
and making sure families make informed decisions based on their 
values and choices.
    Clearly, around Alzheimer's, you have made progress. But as 
you think through the quality measures within MIPS, how do you 
get it right to also reflect the priorities of the Medicare 
beneficiaries and their families at that important stage of 
life?
    Mr. Slavitt. One of the things that is really important to 
us is that we get out of the mode of just feeling like we are 
paying physicians to cut, test, or prescribe, because as you 
point out, if we do not also begin to pay physicians to have 
conversations and talk about the cognitive issues, whether they 
are advanced planning issues or whether they are issues of how 
people are managing the chronic conditions that they are living 
with, we are not going to make that kind of progress, both 
short-term and long-term, that we need to make.
    So models like medical home models--which provide a care 
coordination fee within a small practice that could not 
otherwise afford the resources to invest in things that allow 
them to call patients at home, check on how they are doing, 
make sure they are taking their medications, see what barriers 
exist, whether they are social or clinical--are very, very 
important.
    I think the more and more of these advanced models that are 
part of MACRA, the more successful we are going to be in this 
whole array of both chronic topics, as well as other topics 
that require physicians to spend their time the way they and 
the patients really want them to spend it.
    Senator Warner. I would simply say that part of this--the 
chronic care and, also, the advanced care planning and trying 
to make sure that if a family does sit down and create an 
advance directive or a POLST--is that the docs and hospitals 
are incented to actually follow that advance directive.
    There are so many heartbreaking stories we have heard of 
family members, oftentimes daughters, having to intervene to 
make sure that mom's or dad's wishes are truly respected. It is 
terribly important.
    Let me move to another subject with my last minute, 
something that has not been raised so far, but an area of 
importance to me. That is the whole intersection--as we sort 
through health care--of cybersecurity and protection of health-
care records.
    Ninety-four percent of medical institutions have said their 
organizations have been victims of a cyber-hack or cyber-
attack. Under the proposed rule, you do recognize this, and a 
provider has to, quote-unquote, ``protect'' patient health 
information through security risk analysis and effectively 
check a box, and if they do not check the box, they do not get 
credit here.
    But in a field that is so dynamic and constantly evolving, 
how do you make sure that that box checked, as cyber-threats 
continue to evolve, is going to be able to be monitored on an 
ongoing basis?
    Mr. Slavitt. Well, I think we have to place the burden on 
the people who can really do the most here, which is the 
vendors and the technology community. I think physicians and 
their willingness to attest to being careful with patient 
data--I think physicians take that very, very seriously.
    So that is probably not the largest concern. The largest 
concern is to make sure that as we move to a world of 
electronic medical records, they continue to update and qualify 
for certification in the latest cybersecurity standards and 
that they do not get certified unless they pass the latest 
standard.
    We are going to need to, to your point, continue to evolve 
that, because, unfortunately, the state-of-the-art of 
cybersecurity continues to move.
    Senator Warner. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Toomey?
    Senator Toomey. Thank you, Mr. Chairman.
    Mr. Slavitt, thanks for joining us again.
    I would just like to briefly mention that the last time you 
came before this committee, I think it was the last time, you 
expressed your support and the administration's support for the 
lock-in provision being provided to Medicare, a provision that 
would allow Medicare to identify and then do something about 
patients who are doctor-shopping for opioids, and I want to 
thank you for that support.
    As you may know, that provision is included in the 
Comprehensive Addiction and Recovery Act bill that I think we 
are going to vote on perhaps later today, and I am very hopeful 
that that will pass, that the bill will pass. I think it has a 
very, very strong combination of mostly modest steps that we 
can take to deal with an enormously difficult and excruciating 
problem.
    So, thanks for your support on lock-in.
    I also want to thank you for responding to what several of 
us have observed, which is the previous policy, as I understand 
it, of linking somewhat Medicare reimbursements to hospitals 
based on the results of patient satisfaction questionnaires, 
which included questions about pain management.
    It may be somewhat indirect, but the result was to create a 
financial incentive to over-prescribe opioids. My understanding 
is that there is going to be a discontinuation of the link 
between the response to the pain questions and the 
reimbursement level. Am I correct in understanding that?
    Mr. Slavitt. That is correct.
    Senator Toomey. Has that gone into effect yet, or is it 
about to go into effect?
    Mr. Slavitt. It is a proposed rule. So we are seeking 
comments on that right now.
    Senator Toomey. Will reimbursement levels still be somewhat 
a function of other questions on the patient satisfaction 
questionnaire?
    Mr. Slavitt. Absolutely.
    Senator Toomey. They will. But no longer will the pain 
management question----
    Mr. Slavitt. That is correct.
    Senator Toomey. I think that is exactly the right approach. 
I want to thank you for that.
    The question that I want to ask is about the CO-OPs. I 
think just this morning, the latest CO-OP announced its 
failure. We are now, I think, up to 16 of the original 23, I 
believe, Obamacare CO-OPs having left the business.
    I think in most cases, it is a simple bankruptcy, and I 
think they failed financially. And along the way, of course, 
their discontinued operation leaves hundreds of thousands of 
people without health insurance.
    Taxpayers have put $1.5 billion into the CO-OPs that have 
failed. That money is just gone. And I am wondering about the 
future of the remaining ones.
    I guess my first question would be, has your staff advised 
you to expect further failures, additional CO-OP failures over 
the course of the remainder of this year?
    Mr. Slavitt. We are just now at the point where, in July, 
we are reviewing the June financials of the CO-OPs. I would say 
kind of an overarching point in the way that at least I think 
about the CO-OPs is that they are very small businesses 
competing against very large businesses, with low amounts of 
capital and, as a result, very low margins of error.
    So we watch them month-to-month, and, more importantly, the 
States and the State departments of insurance, which are really 
responsible for having a bead on capital requirements, watch 
them as well.
    I think when we do this, our priorities are twofold. One is 
to make sure that consumers are taken care of as best as 
possible and to support the States which really make a lot of 
those decisions.
    Secondly, our job as a lender is to responsibly look after 
the capital that has been committed and go through a process 
with the Department of Justice to make sure that we recover 
funds when possible.
    Senator Toomey. I understand. But my question was, has your 
staff advised you to expect further failures over the course of 
this year, or do you think we are done, that the remaining CO-
OPs are mostly going to be fine? Do you have an opinion on 
that?
    Mr. Slavitt. I think it is a month-to-month focus for us 
right now. I think we are working closely with the existing CO-
OPs. I think all of them, while successful in some measures, 
all of them have pretty low margins of error, and I think we 
need to watch them.
    Senator Toomey. So something like 70 percent have already 
failed. I am told to expect there will be more failures.
    When I look at the big insurers who are well-capitalized 
and extremely sophisticated, they are losing money hand over 
fist in this space, and I am worried that this is a 
manifestation of the adverse selection that some of us were 
afraid was going to occur, that it is happening.
    Premiums are rising enormously in response to that. Do we 
not have a big problem in this whole space?
    Mr. Slavitt. I think my characterization would be that we 
have a wide variety across the entire spectrum, from some 
health plans that are making a lot of money and very 
successful, to some that are either at break-even or close, to 
others that have been losing money and are going to be----
    Senator Toomey. But a big majority are losing money, right? 
A big majority of these plans are losing money.
    Mr. Slavitt. I would say, as we sit here in 2016, that is 
not necessarily clear. But I think what is important is that 
this is a market that will evolve over the first 2 years. I 
expect some new entrants to come in. I expect some people to 
move out of markets. I think this is to be expected in a brand 
new market with a new set of rules.
    I think what is important to us is that we have a model 
where people with preexisting conditions can get covered. 
People have to make adjustments when they have to cover people 
with preexisting conditions. We understand that. So we try to 
compensate for that by risk adjustment and other approaches, 
and we will continue to stay on top of it.
    The Chairman. The Senator's time is up.
    Senator Toomey. Thank you, Mr. Chairman.
    The Chairman. We have a vote on, and Senator Carper will be 
our last, as far as I know.
    Senator Carper. Thank you.
    The Chairman. I am going to go vote, and if you could wrap 
it up, I would appreciate it.
    Senator Carper. Yes, Mr. Chairman, I would be pleased to.
    The Chairman. Mr. Slavitt, I am very grateful for your 
testimony and grateful for you taking time to be with us. I 
appreciate you being here.
    Senator Carper. Mr. Chairman, before you go, I just want to 
say Mr. Slavitt's nomination has been before the Senate, I 
think, for about a month. He has, as you know, a very, very 
hard job. I think he works hard for the money, he works hard 
for our money, and I would just urge us to move his nomination.
    The Chairman. I understand.
    Senator Carper [presiding]. Having said that, I would say, 
Mr. Slavitt, thanks. It is very nice to see you. I thank you 
and your team very much for taking on a tough job and working 
at it so hard.
    I want to thank you, also, for your help with the first 
Accountable Care Organization in our State and the work that 
you and your staff did to give the doctors in Delaware and in 
Maryland another chance to prove that they can deliver high-
quality care. I think we will ensure that these doctors remain 
on the important path of moving away from fee-for-service and 
toward performance-based models, for which we also want to 
thank you.
    In your testimony, I believe you noted that 30 percent of 
Medicare payments were already linked to Alternative Payment 
Models and that we soon hope to reach 50 percent of payments 
with these alternative models.
    My question is, what type of Alternative Payment Models do 
you consider to be the most promising for improving health-care 
outcomes and lowering costs? And related to that, what 
obstacles prevent Accountable Care Organizations from 
shouldering more risk for their patients?
    Mr. Slavitt. Thank you, Senator. I think we are just in the 
first and second generation of seeing what new approaches work, 
that work better than fee-for-service. I think we all agree 
that the fee-for-service program is not the applicable system, 
and we have spent the last few years, as you pointed out, 
testing several different approaches.
    I will name four really quickly. The first is a bundled 
approach where someone will come in for a procedure, and the 
entirety of their experience--inpatient, outpatient, 
rehabilitation, everything--can be covered under one payment. 
That, of course, encourages teamwork.
    The second would be a team-based model, as you pointed out, 
like an accountable care model, where physicians are 
essentially incentivized to work together as part of a team to 
look at an entire populations' health. Those models, I think, 
have begun to show some real progress.
    Third are models that are primary care-focused, like a 
medical home, where physicians can essentially take the time 
and have investments into care coordination.
    Then, finally, I think a very promising development and 
maybe a more recent development is prevention models. We just 
launched and announced that we are going to be scaling a model 
that is a prevention model for diabetes. I think that is very 
exciting, very promising.
    All of those four domains and possibly others, I think, 
will emerge over the next few years to hopefully provide a next 
generation of care for patients across the country.
    Senator Carper. Good. I would concur with you on the last 
one, because the prevention model is very encouraging. Thank 
you.
    My other question relates to CMS stakeholder meetings. The 
new physician payment system is, as you know, fairly 
complicated to explain and for physicians to understand, for us 
to understand.
    I am encouraged that you and your colleagues have held 
literally hundreds of stakeholder meetings, I think, throughout 
the country to collect feedback for implementing this new 
Medicare payment system.
    Could you just share with us--not today, but in the days 
ahead--the schedule for future meetings so that we can let our 
own constituents know when they can participate, how they can 
participate?
    The other thing I would ask is, what other types of 
outreach and interface are you considering to help physicians 
navigate this new payment system?
    Mr. Slavitt. To your first question, we absolutely will.
    To your second question, we find with a law of this 
importance, almost the worst place for us to write the policy 
is here in Washington, and the best place is to get out in the 
field and visit physician offices.
    So the types of places and the ways we have been conducting 
outreach range from sitting down in physician offices and 
having physicians share with us their experience with the 
programs that they have to deal with today, to focus groups, to 
day-long workshops and working sessions. And then what we have 
to do is engage the people whom physicians trust the most to 
help them educate about this.
    That is not necessarily going to be the Federal Government, 
it might surprise us. It is going to sometimes be the specialty 
society or the State medical society or some other organization 
that will be very knowledgeable about the program and that the 
physician can rely on for some advice in this area.
    So part of our stakeholder engagement includes making sure 
that the people the physicians trust become as knowledgeable as 
they need to be and have a direct pipeline to us to get 
information.
    Senator Carper. Thanks. Thanks so much.
    My staff just gave me this. The chairman has asked me, 
given my strong support for your confirmation, to ask unanimous 
consent that you be--no, just kidding. [Laughter.]
    We are here on an otherwise dull Wednesday morning. No, not 
dull. Not dull at all.
    I want to thank you for your testimony. We want to thank 
you for your testimony today.
    We also want to thank our colleagues for their 
participation. This is, for all of us I think, a highly 
important meeting, and we hope that we can continue working 
with you and your folks as we seek to further improve the 
Medicare system.
    I was with some folks from another industry today, and I 
said, ``You have a really hard job,'' trying to improve 
quality, quality outcomes, with value systems and prevention 
and so forth, and it is not easy. So we thank you for that.
    I would ask that any written questions be submitted by 
Wednesday, July 27, 2016.
    With that, this hearing is adjourned.
    [Whereupon, at 11:19 a.m., the hearing was concluded.]

                            A P P E N D I X

              Additional Material Submitted for the Record

                              ----------                              


              Prepared Statement of Hon. Orrin G. Hatch, 
                        a U.S. Senator From Utah
WASHINGTON--Senate Finance Committee Chairman Orrin Hatch (R-Utah) 
today delivered the following opening statement at a hearing to examine 
the Centers for Medicare and Medicaid Services' (CMS) implementation of 
the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA):

    I'd like to welcome everyone to this morning's hearing. Today, the 
committee will hear from the Centers for Medicare and Medicaid Services 
on its initial proposal for implementing the physician payment reforms 
included in the historic Medicare Access and CHIP Reauthorization Act 
of 2015, generally referred to as MACRA.

    I would like to thank Acting Administrator Slavitt for appearing 
today to testify on this important topic.

    The passage of MACRA was a tremendous bipartisan achievement that 
addressed long-standing and reoccurring problems under Medicare. It 
was, I'll note, one of the first of many significant bipartisan 
accomplishments we've seen in the 114th Congress.

    Most notably, MACRA eliminated the flawed Medicare Sustainable 
Growth Rate, or SGR, formula.

    As everyone here will recall, the SGR mandated significant cuts to 
Medicare physician payments that were, on a more or less yearly basis, 
averted by legislation to ``patch'' the SGR. Between 2002 and 2014, 
Congress passed 17 different laws to prevent the cuts from taking 
place.

    The perpetual SGR cycle took up far too much of Congress's time and 
diverted attention from other priorities.

    Getting rid of the SGR not only resolved a vexing problem for 
lawmakers, it gave security to Medicare beneficiaries who often had to 
wonder if they would eventually lose access to their physicians.

    In addition to repealing and replacing the SGR, the MACRA law 
contained structural reforms to the Medicare program, including 
increased means testing for Part B and Part D premiums and limits on 
``first dollar'' Medigap coverage for new beneficiaries. While these 
structural changes put Medicare on a more solid fiscal footing, more 
needs to be done to ensure the program is there for future generations.

    I note reforms today to reiterate what I have said on several 
occasions: despite the cries of naysayers, bipartisan Medicare reform 
is possible, and the passage of MACRA proves that to be the case.

    I look forward to continuing the discussion on how to shore up the 
Medicare program for the long-term, but, for today, let me turn back to 
the stated purpose of this hearing, which is MACRA's physician payment 
reforms.

    The physician payment reforms are the result of years of effort in 
the Finance Committee. Working with the House Committees of 
jurisdiction, this committee was able to craft a legislative solution 
that garnered the support of nearly every national and State physician 
organization. This proved to be key to MACRA's enactment as previous 
efforts to eliminate the SGR had been stymied by the question of what 
would replace it.

    These reforms were intended to accomplish several things. Our most 
specific goals were to:

        (1)  Streamline disjointed incentive programs to reduce the 
administrative burden on physicians;
        (2)  Ensure that metrics on which physicians are assessed are 
relevant to the patients they treat;
        (3)  Provide flexibility to physicians to participate in a way 
that best fits their practice situation; and
        (4)  Provide an incentive to consider and attempt alternative 
payment models.

    We're here today to discuss and hopefully evaluate how CMS has 
proposed to implement the law in order to achieve these goals.

    Let me say that I appreciate the extent to which CMS has reached 
out to stakeholders to get their thoughts in advance of the proposed 
rule the agency released in April.

    And I understand that CMS continued its outreach during the public 
comment to ensure that key groups would be informed on the proposal and 
to hear their reactions. Consultation with stakeholders--especially 
beneficiaries and physicians on the front lines of providing care--is 
precisely what we sought when we drafted the statute.

    I also appreciate the outreach that CMS has undertaken with Members 
of Congress and their staff. Viewing implementation as a partnership 
with Congress is the right way to go.

    Without delving too far into my long-standing concerns about the 
administration's lack of disclosure and cooperation with Congress, I 
will say that I wish this model would be used more often.

    The CMS proposal that resulted from this consultation and outreach 
is hundreds of pages. And the details matter greatly to our physicians 
and patients.

    This hearing will give CMS a chance to describe its implementation 
efforts and give members of the committee an opportunity to reflect and 
ask questions on issues that are garnering significant comment and 
public discussion. It will also allow members to speak to Congress's 
intent with regard to MACRA, share insights, and, hopefully, get 
answers on issues that are important to their constituents.

    Before we hear from Mr. Slavitt on CMS implementation though, I 
want to flag an important concern that I know is shared by others, 
which is the plight of small and rural physician practices.

    We recognized the inherent challenges of these types of practices 
when we crafted the MACRA statute and I know CMS is aware of these 
issues, but we need to make sure that the law is implemented in a way 
that works for these physicians and ensures that these practice 
settings remain viable options for Medicare beneficiaries.

    I look forward to a constructive dialogue here today and to the 
committee's continued engagement with CMS through the final rule in 
November and beyond.

                                 ______
                                 
 Prepared Statement of Andy Slavitt, Acting Administrator, Centers for 
Medicare and Medicaid Services, Department of Health and Human Services
    Chairman Hatch, Ranking Member Wyden, and members of the committee, 
thank you for the invitation and the opportunity to discuss the Centers 
for Medicare and Medicaid Services' (CMS's) work to implement the 
Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). We 
greatly appreciate your leadership in passing this important law, which 
provides a new opportunity for CMS to partner with physicians and 
clinicians to support quality improvement and develop new payment 
models to further our nation's shared goals of a health care system 
that achieves better care, smarter spending, and healthier people and 
puts empowered and engaged consumers at the center of their care. As we 
take our initial steps to implement this important law, we have and 
will continue to work closely with you and listen to the physicians and 
clinicians providing care to Medicare beneficiaries, with the goal of 
creating a new payment program that is focused on the needs of patients 
and responsive to the day-to-day challenges and opportunities within 
physician practices. As we continue to transform the Medicare program, 
we are working to move beyond ``one size fits all'' measurements to an 
approach that recognizes and supports the diversity of medical 
practices that serve Medicare beneficiaries and offers multiple paths 
to value-driven care. To inform this effort, CMS is meeting with 
practicing physicians across the country, including those in big 
practices and small practices, specialists and primary care providers, 
and those in new payment models and in traditional fee-for-service.

    CMS is committed to finding ways, to deliver better care at lower 
costs. Today, over 55 million Americans are covered by Medicare \1\--
and 10,000 become eligible for Medicare every day.\2\ For most of the 
past 50 years, Medicare was primarily a fee-for-service payment system 
that paid health care providers based on the volume of services they 
delivered. In the last few years, we have made tremendous progress to 
transform our nation's health care system into one that works better 
for everyone and rewards value over volume. Key to this effort is 
changing how we pay physicians and other clinicians, so they can focus 
on the quality of care they give, and not the quantity of services they 
deliver or order. Already, we estimate that 30 percent of traditional 
Medicare payments are tied to alternative payment models (APMs). 
Generally speaking, an APM is a model that puts the outcome of the 
patient at the center and holds care teams accountable for the quality 
and cost of the care they deliver to a population of patients by 
providing a financial incentive to coordinate care for their patients. 
This can help patients receive the clinically appropriate care for 
their conditions and reduces avoidable hospitalizations, emergency 
department visits, adverse medication interactions, and other problems 
caused by inappropriate care or siloed care. Hospital and physician 
participation in APMs is a major milestone in the continued effort 
towards improving quality and care coordination. We expect this 
progress to continue, and we are on track to meet our goal of tying 50 
percent of traditional Medicare payments to APMs by 2018--especially in 
light of MACRA.
---------------------------------------------------------------------------
    \1\ https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-
releases/2015-Press-releases-items/2015-07-28.html.
    \2\ http://www.medpac.gov/documents/reports/chapter-2-the-next-
generation-of-medicare-beneficiaries-(june-2015-report).pdf?sfvrsn=0.

    The enactment of MACRA, which replaced the Sustainable Growth Rate 
(SGR) formula with a more consistent way for paying physicians and 
other clinicians, provided new tools to modernize Medicare and simplify 
quality programs and payments for these professionals. Currently, 
Medicare measures the value and quality of care provided by physicians 
and other clinicians through a patchwork of programs. Some clinicians 
are part of APMs such as Accountable Care Organizations (ACOs), the 
Comprehensive Primary Care Initiative, and the Bundled Payments for 
Care Improvement Initiative--and most participate in programs such as 
the Physician Quality Reporting System, Physician Value-based Payment 
Modifier (``Value Modifier Program''), and the Medicare Electronic 
Health Record (EHR) Incentive Program. Thanks to Congress, MACRA 
streamlined these various programs into a single framework where 
clinicians have the opportunity to be paid more for providing better 
value and better care for their patients. CMS has proposed to implement 
these changes through the unified framework called the Quality Payment 
---------------------------------------------------------------------------
Program.

    The Quality Payment Program gives physicians and clinicians the 
flexibility to participate in one of two paths. First, the Merit-based 
Incentive Payment System (MIPS) streamlines three existing CMS programs 
into a single, simplified program with lower reporting burden and new 
flexibility in the way clinicians are measured on performance. MIPS 
allows Medicare clinicians to be paid for providing high value care 
through success in four interrelated performance categories: Quality, 
Advancing Care Information, Clinical Practice Improvement Activities, 
and Cost.

    For physicians and clinicians who take a further step towards care 
transformation, the Quality Payment Program rewards physicians and 
clinicians through a second path, participation in Advanced APMs. Under 
Advanced APMs, physicians and clinicians would accept more than a 
nominal amount of risk for providing coordinated, high-quality care for 
a set portion of their practice, such as through Tracks 2 and 3 of the 
Medicare Shared Savings Program and the Next Generation ACO model.

    Since the enactment of MACRA a little over a year ago, CMS has been 
developing our approach toward implementation of the new law, and on 
April 27, 2016, CMS issued a Notice of Proposed Rule Making (NPRM).\3\ 
In our efforts to draft a proposal that would be simpler and meaningful 
for physicians and clinicians, we reached out and listened to over 
6,000 stakeholders before we published the proposed rule, including 
state medical societies, physician groups, consumer groups, and federal 
partners. We asked for comments \4\ from the stakeholder community on 
key topics related to how to develop the measurements, scoring, and 
public reporting for the Quality Payment Program. We conducted multi-
day workshops and visited with physicians in their communities 
individually and in groups to understand how the changes we considered 
may positively impact care and how to avoid unintended consequences. 
Just as stakeholder input has been instrumental in the development of 
the proposed rule, the feedback we have received will be essential in 
our development of final regulations. Since proposing the rule, CMS has 
conducted extensive outreach to providers and other stakeholders to 
ensure that we get their feedback on our proposal. These efforts have 
stretched across the country and have been both large and small, with 
more than 200 outreach events. We have also hosted numerous webinars 
that have seen more than 64,000 participants. We received 3,875 
comments during the public comment period.\5\ We are currently 
reviewing the comments and feedback we received and expect to issue 
final rulemaking after this review is complete.
---------------------------------------------------------------------------
    \3\ http://federalregister.gov/a/2016-10032.
    \4\ http://federalregister.gov/a/2015-24906.
    \5\ https://www.regulations.gov/document?D=CMS-2016-0060-0068.

    The input we have received from stakeholders throughout the process 
has been very valuable: physicians and clinicians want support for a 
care system that focuses on quality, but too many unaligned quality 
programs, measures, and technology requirements can hinder their best 
efforts to accomplish these goals. Based on what we learned, our 
approach to implementation has been guided by four principles. First, 
patients are, and must remain, the key focus. Financial incentives 
should work in the background to support physician and clinician 
efforts to provide high quality services, and the needs of the patient, 
not measurements, need to be the focus of our approach. Second, success 
will come from adopting approaches that can be driven by the physician 
practice. Quality measurement needs to accurately reflect the needs of 
a diverse range of patient populations and practice types and give 
physicians and other clinicians the opportunity to select elements of 
the program and measures that are right for their practice. Third, in 
everything we do, we must strive to make care delivery as simple as 
possible, with more support for collaboration and communication through 
delivery system reform. Fourth and finally, we must focus on the unique 
concerns of small independent practices, as well as rural practices and 
---------------------------------------------------------------------------
practices in underserved areas.

    We relied heavily on stakeholder input we received over the last 
year to inform our proposal of a scoring methodology for MIPS that aims 
to improve upon and streamline existing measures in the quality, cost, 
and advancing care information categories, which are based in part upon 
current CMS programs. In particular, we have been working side-by-side 
with the physician and consumer communities to address needs and 
concerns about the Medicare EHR Incentive Program, often known as 
Meaningful Use for physicians, as we transition it to the Advancing 
Care Information category in MIPS. The new approach heightens focus on 
the patient, increases flexibility, reduces burden, and concentrates on 
aspects of health information technology, such as health information 
exchange, that are critical for delivery system reform and improving 
patient outcomes. We also used this feedback when proposing the new 
clinical practice improvement activities category, which the statute 
created. When developing the proposed activities for this category, we 
listened closely to specialty societies and associations when creating 
options to allow clinicians to select activities that match their 
practices' goals.

    While we expect that most clinicians will participate in MIPS for 
the first years of the Quality Payment Program, we will continuously 
search for opportunities to expand and refine our portfolio of payment 
models in order to maximize the number of physicians and other 
clinicians who have the opportunity to participate in Advanced APMs. It 
is our intent to allow as much flexibility as possible for clinicians 
to switch between MIPS and participation in Advanced APMs based on what 
works best for them and their patients. The proposed rule is the latest 
step in our efforts to work in concert with stakeholders on the front-
line of care delivery to draw upon their expertise and incorporate 
their input into the policies for the Quality Payment Program so that 
together, we can achieve the aim of the law.
                 notice of proposed rule making (nprm)
    In our proposed rule, we provide details and descriptions of the 
proposed policies that will allow us to implement the important new 
provider payment provisions included in MACRA.
Merit-based Incentive Payment System (MIPS)
    Currently, Medicare measures physicians and other clinicians on how 
they provide quality care and reduce costs through a patchwork of 
programs, with clinicians reporting through some combination of the 
Physician Quality Reporting System, the Value Modifier Program, and the 
Medicare EHR Incentive Program. Through the law, Congress streamlined 
and improved these reporting programs into the Merit-based Incentive 
Payment System. Under MIPS, eligible physicians and clinicians will 
report their performance under four categories and will receive a 
payment adjustment based on their overall performance, or composite 
performance score.

    Consistent with the goals of the law, the proposed rule would 
improve the relevance of Medicare's value and quality-based payments 
and increase clinician flexibility by allowing clinicians to choose 
measures and activities appropriate to the type of care they provide. 
Under our proposed rule, performance measurement under the new program 
for physicians and other eligible clinicians would begin in 2017, with 
payments based on those measures beginning in 2019. MIPS allows 
Medicare clinicians to be paid for providing high quality, efficient 
care through success in four performance categories:

        1.  Quality (50 percent of total score in year 1; replaces the 
Physician Quality Reporting System and the quality component of the 
Value Modifier Program): Clinicians would choose to report six measures 
versus the nine measures currently required under the Physician Quality 
Reporting System. This category gives clinicians reporting options to 
choose from to accommodate differences in specialty and practices.

        2.  Advancing Care Information (25 percent of total score in 
year 1; replaces the Medicare EHR Incentive Program for physicians, 
also known as ``Meaningful Use''): Clinicians would choose to report 
customizable measures that reflect how they use health information 
technology in their day-to-day practice, with a particular emphasis on 
interoperability and secure information exchange. Unlike the existing 
Meaningful Use program, this category would not require quality 
reporting, which would be assessed within the Quality category.

        3.  Clinical Practice Improvement Activities (15 percent of 
total score in year 1): Clinicians would be rewarded for clinical 
practice improvement activities such as activities focused on care 
coordination, beneficiary engagement, and patient safety. Clinicians 
may select activities that match their practices' goals from a list of 
more than 90 options. In addition, clinicians would receive credit in 
this category for participating in APMs and in Patient-Centered Medical 
Homes.

        4.  Cost (10 percent of total score in year 1; replaces the 
cost component of the Value Modifier Program, also known as Resource 
Use): The score would be based on Medicare claims and require no 
reporting by physicians or other clinicians. This category would 
integrate more than 40 episode-specific measures to account for 
differences among specialties.

    The law requires MIPS to be budget neutral. Therefore, physicians' 
and clinicians' MIPS scores would be used to compute a positive, 
negative, or neutral adjustment to their Medicare Part B payments. In 
the first year, depending on the variation of MIPS scores, adjustments 
are calculated so that negative adjustments can be no more than 4 
percent, and positive adjustments are generally up to 4 percent; the 
positive adjustments will be scaled up or down to achieve budget 
neutrality. Also, in the first 6 years of the program, additional 
bonuses are provided for exceptional performance.
Advanced Alternative Payment Models (APMs)
    For clinicians who take a further step towards care transformation, 
the law creates another path. Physicians and clinicians who participate 
to a sufficient extent in Advanced APMs would qualify for incentive 
payments. Importantly, the law does not change how any particular APM 
rewards value. Instead, it creates extra incentives for participation 
in Advanced APMs. For years 2019 through 2024, a physician or clinician 
who meets the law's standards for Advanced APM participation in a given 
year is excluded from MIPS payment adjustments and receives a 5 percent 
Medicare Part B incentive payment. For years 2026 and later, a 
clinician who meets these standards is excluded from MIPS adjustments 
and receives a higher annual fee schedule update than those clinicians 
who do not significantly participate in an Advanced APM.

    Under the law, Advanced APMs are those in which clinicians accept 
risk and reward for providing coordinated, high-quality, and efficient 
care. As proposed, Advanced APMs must generally:

        1.  Require participants to bear a certain amount of financial 
risk. Under our proposal, an Advanced APM would meet the financial risk 
requirement if CMS would withhold payment, reduce rates, or require the 
entity to make payments to CMS if its actual expenditures exceed 
expected expenditures, consistent with parameters we specified in the 
rule.

        2.  Base payments on quality measures comparable to those used 
in the MIPS quality performance category. To meet this statutory 
requirement, we propose that an Advanced APM must base payment on 
quality measures that are evidence-based, reliable, and valid. In 
addition, at least one such measure must be an outcome measure if an 
outcome measure appropriate to the Advanced APM is available on the 
MIPS measure list.

        3.  Require participants to use certified EHR technology. To 
meet this requirement, we propose that an Advanced APM must require 
that at least 50 percent of the clinicians use certified EHR technology 
to document and communicate clinical care information in the first 
performance year. This requirement increases to 75 percent in the 
second performance year.

    In addition, under the statute, medical home models, which are a 
popular and patient-centered approach for primary care practices to 
coordinate care, that have been expanded under the Innovation Center 
authority qualify as Advanced APMs regardless of whether they meet the 
financial risk criteria. While medical home models have not yet been 
expanded, the proposed rule lays out criteria for medical home models 
to ensure that primary care physicians have opportunities to 
participate in Advanced APMs.

    The rule proposes a definition of medical home models, which focus 
on primary care and accountability for empaneled patients across the 
continuum of care. Because medical homes tend to have less experience 
with financial risk than larger organizations and limited capability to 
sustain substantial losses, we propose unique Advanced APM financial 
risk standards, consistent with the statute, to accommodate medical 
homes that are part of organizations with 50 or fewer clinicians.

    The proposed rule includes a list of models that would qualify 
under the terms of the proposed rule as Advanced APMs. These include:

          Comprehensive ESRD Care (Large Dialysis Organization 
arrangement);

          Comprehensive Primary Care Plus (CPC+);

          Medicare Shared Savings Program--Track 2;

          Medicare Shared Savings Program--Track 3;

          Next Generation ACO Model; and

          Oncology Care Model--Two-sided risk (available in 2018).

    Under the proposed rule, CMS would update this list annually to add 
new payment models that qualify. CMS will continue to modify models in 
coming years to help them qualify as Advanced APMs. In addition, 
starting in performance year 2019, clinicians could qualify for 
incentive payments based in part on participation in Advanced APMs 
developed by non-Medicare payers, such as private insurers, Medicare 
Advantage plans, or State Medicaid programs.

    We recognize the substantial time and money commitments in which 
APM participants invest in order to become successful participants. 
Under the proposed rule, physicians and clinicians who participate in 
Advanced APMs but do not meet the law's criteria for sufficient 
participation in Advanced APMs, and those who participate in certain 
non-Advanced APMs, would be exempt from the Cost category in MIPS, 
would be able to use their APM quality reporting for the MIPS Quality 
category, and would receive credit toward their score in the Clinical 
Practice Improvement Activities category. We want to make sure that in 
addition to encouraging physicians and other clinicians to improve 
quality of care by participating in APMs that best fit their practice 
and patient needs, physicians and clinicians are not subject to 
duplicative, overly burdensome reporting requirements.
  physician-focused payment model technical advisory committee (ptac)
    To help spur innovation for models that meet the needs of the 
physician community, MACRA established a new independent advisory 
committee, the Physician-
Focused Payment Model Technical Advisory Committee (PTAC). The PTAC 
will meet at least quarterly to review physician-focused payment models 
submitted by individuals and stakeholder entities and prepare comments 
and recommendations on proposals that are received, explaining whether 
models meet CMS criteria for physician-focused payment models. The 11 
members of the PTAC, who were appointed by the Comptroller General, are 
experts in physician-focused payment models and related delivery of 
care, including researchers, practicing physicians, and other 
stakeholders. The PTAC has met twice and presentations from the meeting 
are available online.\6\ We encourage physician specialists and other 
stakeholders to engage with the PTAC to suggest well designed, robust 
models. CMS is committed to working closely with the PTAC and are 
looking forward to reviewing their recommendations for new physician-
focused payment models.
---------------------------------------------------------------------------
    \6\ https://aspe.hhs.gov/meetings-physician-focused-payment-model-
technical-advisory-committee.
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                          technical assistance
    We know that physicians and other clinicians may need assistance in 
transitioning to the MIPS, and we want to make sure that they have the 
tools they need to succeed in a redesigned system. Congress provided 
funding in MACRA for technical assistance to small practices, rural 
practices, and practices in medically underserved health professional 
shortage areas (HPSAs).

    Last month, CMS announced the availability of $20 million of this 
funding for on-the-ground training and education for Medicare 
clinicians in individual or small group practices of 15 clinicians or 
fewer. These funds will help provide hands-on training tailored to 
small practices, especially those that practice in historically under-
resourced areas including rural areas, HPSAs, and medically underserved 
areas. As required by MACRA, HHS will award $20 million each year for 5 
years, providing $100 million in total to help these practices 
successfully participate in the Quality Payment Program.

    In addition to MACRA implementation efforts, last month, CMS 
launched the second round of the Support and Alignment Networks under 
the Transforming Clinical Practice Initiative. This opportunity will 
provide up to $10 million over the next 3 years to leverage primary and 
specialist care transformation work and learning that will catalyze the 
adoption of APMs on a large scale. Support and Alignment Network 2.0 
awardees' activities, coaching, and technical assistance will help 
practices transform the way they deliver care. The ultimate goal is for 
these practices to participate in APMs and Advanced APMs. Critical to 
this approach is the capacity for awardees to accurately identify large 
numbers of clinicians and practices in advanced states of readiness 
through sound data analytics capabilities, to enroll them into the 
Transforming Clinical Practice Initiative, to provide them with 
tailored technical assistance, and to align them with the most suitable 
Alternative Payment Model options. Further, awardees will need to 
customize direct technical assistance and support services that are 
tailored to these clinicians' and practices' needs.
                               conclusion
    MACRA will help move Medicare towards more fully rewarding the 
value and quality of services provided by physicians and other 
clinicians, not just the quantity of such services. For it to be 
successful--in other words, for MACRA to improve care delivery and 
lower health care costs--we must first demonstrate to clinicians and 
patients both the value of these new payment programs established by 
MACRA and the opportunity for these participants to shape the health 
care system of the future. The program must be flexible, practice-
driven, and person-centered. It must contain achievable measures; it 
must support continued and improved information sharing through 
innovations and advancements in interoperability and the health IT 
infrastructure; it must engage and educate physicians and others 
clinicians; and it must promote and reward improvement over time.

    Our proposed rule incorporates valuable input received to date, but 
it is only a first step in an iterative process for implementing the 
new law. Moving forward, we will continue to gather feedback from our 
stakeholders, to inform an implementation approach that leads to better 
care, smarter spending, and improved patient outcomes. We will continue 
partnering with Congress, physicians and other providers, consumers, 
and other stakeholders across the Nation to make a transformed and 
improved health system a reality for all Americans. We look forward to 
working with you as we continue to implement this seminal law.

                                 ______
                                 
                 Prepared Statement of Hon. Ron Wyden, 
                       a U.S. Senator From Oregon
    There are big opportunities ahead to make substantial, bipartisan 
progress when it comes to protecting and updating the Medicare 
guarantee, and that's what the committee will be discussing this 
morning.

    The first is implementing the plan to throw in the trash can the 
hopelessly broken, out-of-date Medicare reimbursement formula known as 
the SGR. This was the source of endless uncertainty for health-care 
providers and seniors, and it's now in the dustbin of history. Today, 
the committee will talk about how its replacement will be implemented.

    Second, it's important to build on the new Medicare payment system, 
and in my view the obvious place to start ought to be in the area of 
chronic care. Seniors suffering from these chronic illnesses, such as 
heart disease, cancer, diabetes and stroke, now account for 93 percent 
of spending in the program. I'm glad that's now a bipartisan focus of 
this committee.

    By finally clearing the decks of the SGR debacle, the Finance 
Committee has been able to get to work on developing legislation that 
will empower families and Medicare to manage and treat these 
debilitating diseases. I'd like to thank Chairman Hatch, along with 
Senators Isakson and Warner especially, for their continued dedication 
to this issue. This effort is already paying dividends; last week, in a 
rule released by the Centers for Medicare and Medicaid Services (CMS), 
they proposed adopting four policies the chronic care group has 
developed and putting them in place administratively. There's still 
more work to be done, but that was a promising start.

    Now when it comes to replacing the SGR, Medicare payment reform 
took the important step of engraving in stone the principle of 
rewarding medical care that provides quality over quantity. For the 
seniors who depend on the Medicare guarantee, that ought to result in 
better, more thoughtful health care. That's the direction that 
healthcare is headed in across the country, and Medicare should be 
leading the way.

    I'll make two key points about what it's going to take to implement 
this legislation the right way.

    First is to make sure all doctors who care for our seniors get fair 
treatment under these new rules. That's particularly important for the 
small or solo practitioners who are truly the backbone of rural 
communities.

    Second, this legislation supports efforts to strengthen primary 
care, which in my view is key to making people healthier and bringing 
down costs. For example, the ``Comprehensive Primary Care Plus'' model 
allows Medicare to partner with commercial and State health insurance 
plans so everyone is on the same page when it comes to paying for value 
and quality care.

    That means a primary care doctor who has business in the commercial 
market and in Medicare doesn't have to find a balance between many 
different sets of rules as she's trying to serve as many people in her 
community as possible. This is just one promising example, if done 
right, of innovative changes to the way doctors are paid that will 
improve care for seniors in the program--exactly what these reforms 
were designed to do.

    I'd also like to thank Andy Slavitt, Acting Administrator of the 
Centers for Medicare and Medicaid Services, for joining the committee 
this morning. Andy has always been committed to doing right by the 
millions of Americans who have to navigate the health-care system every 
day. His role in pushing for more value and quality in healthcare is a 
big part of making that a reality.

                                 ______
                                 

                             Communications

                              ----------                              


                     Alliance of Specialty Medicine

                         3823 Fordham Road, NW

                          Washington, DC 20016

Chairman Hatch, Ranking Member Wyden, and members of the committee, the 
Alliance of Specialty Medicine (the Alliance) would like to thank the 
Senate Committee on Finance for the opportunity to provide feedback on 
implementation of the Medicare Access and CHIP Reauthorization Act of 
2015 (MACRA). The Alliance strongly supports your involvement in 
ensuring that the Centers for Medicare and Medicaid Services (CMS) 
follows the legislative intent of MACRA as CMS undergoes rulemaking to 
implement its provisions. The Alliance is a coalition of medical 
specialty societies representing more than 100,000 physicians and 
surgeons from specialty and subspecialty societies dedicated to the 
development of sound federal health care policy that fosters patient 
access to the highest quality specialty care.

Member organizations of the Alliance have continuously sought out and 
developed robust mechanisms (including clinical decision support, 
clinical data registries, and other tools) aimed at improving the 
quality and efficiency of care specialty physicians provide. In 
addition, Alliance member organizations have analyzed and heavily 
scrutinized data related to the services they provide, looking for ways 
to improve how they diagnose, treat, and manage some of the most 
complex health care conditions in their respective specialty areas. 
With those sentiments in mind, the Alliance is eager to engage in 
programs that would further these efforts with incentives and technical 
assistance.

However, despite the considerable and often overwhelming effort the 
Alliance put into helping shape provisions in the MACRA legislation, as 
well as the ongoing feedback provided during the many pre-rulemaking 
comment and feedback opportunities, we are concerned that several of 
the principles we have long supported and conveyed to the agency were 
largely ignored. This is particularly true when it comes to proposals 
associated with the use of electronic health records (EHRs), the 
application of socioeconomic risk factors in quality and cost metrics, 
and most importantly, substantial disparities in Quality Payment 
Program (QPP) requirements that significantly disadvantage specialty 
care providers and the patient populations they serve. We hope that our 
comments herein will move CMS to address some of the most pressing 
issues facing specialty medicine, removing barriers that limit 
meaningful specialty physician engagement, and offering all specialists 
and non-specialists equal opportunities to demonstrate quality in a 
relevant manner.

Our written testimony below will detail some concerns regarding the 
proposals in the CMS proposed rule titled ``Medicare Program; Merit-
Based Incentive Payment System (MIPS) and Alternative Payment Model 
(APM) Incentive Under the Physician Fee Schedule, and Criteria for 
Physician-Focused Payment Models.''

As discussed in more detail below, the Alliance has the following 
recommendations:

      CMS should modify the initial start date of MIPS so physicians 
and practices have adequate time to prepare for the new program. MIPS 
should start no earlier than July 1, 2017, allowing CMS to establish a 
shorter performance period in the first year of the QPP program--such 
as a 6-month performance period, with an optional ``look-back'' to 
January 1 in 2017.
      CMS should minimize the reporting burden, particularly during 
the initial transition period, by maintaining the current PQRS 
reporting thresholds. Additionally, CMS should retain measures groups.
      The cost and resource use measures are completely flawed and 
inadequate. As such, CMS should use its authority under MACRA to re-
weight this category to zero.
      There are very few activities that create a pathway for 
specialists to earn credit for their engagement in clinical practice 
improvement activities, and it is essential that CMS expand its list of 
recognized activities for this MIPS category.
      CMS should eliminate the ``all or nothing'' scoring in the 
electronic health record (now known as ``advancing care information'') 
category.
      The proposed QPP largely retains the flawed siloed approach of 
Medicare's current quality improvement programs and its scoring system 
is extremely complex. CMS should, therefore, rethink its scoring 
methodology and make modifications that would standardize, streamline, 
and maintain consistency so that MIPS eligible clinicians are able to 
understand and respond appropriately.
      We continue to be frustrated by the lack of APM participation 
options available to specialty physicians.
      CMS must establish a mechanism for distinguishing subspecialties 
to ensure that smaller subspecialties are not disadvantaged by the QPP 
and its scoring methodology.

     Proposals for the Merit-Based Incentive Payment System (MIPS)

The MIPS Performance Period

Given the breadth of proposed changes to CMS's quality and performance 
improvement programs, we are very concerned about the timeframe in 
which the agency expects to begin evaluating specialty physician 
performance. We are sympathetic to the administrative challenges CMS 
faces in operationalizing the new program. However, Alliance member 
organizations are concerned that specialty physicians will not be able 
to successfully adapt under the proposed rigorous schedule.

Even before MACRA was signed into law, specialty societies were 
educating their members on the anticipated changes. Unfortunately, and 
not unlike with other CMS programs, the challenge of educating 
physicians on these new programs has been difficult. We find that many 
of our specialty society staff are still educating members on CMS's 
long-standing quality programs, including the Physician Quality 
Reporting System (PQRS) and Value-Based Payment Modifier (VM)/Physician 
Feedback Program. As you know, PQRS continues to have relatively low 
participation rates, and those facing adjustments under the VM do not 
understand exactly from where those penalties stem. As a significant 
portion of the MIPS is based on the PQRS, which continues to suffer 
from critical measure gaps in regards to specialty medicine, as well as 
the flawed VM and problematic Quality and Resource Use Reports (QRURs) 
distributed under the Physician Feedback Program, we are deeply 
concerned about the impact this will have on specialty physicians.

As most specialty physicians will not be ready on January 1, 2017 to 
begin MIPS, CMS should modify the initial start date of the MIPS 
program and provide a shorter reporting/performance period in 2017--
e.g., 6 months, with an optional ``look-back'' to January 1 in 2017. 
CMS should maintain this shorter reporting/performance period in future 
years of the program (with an optional ``look-back'' to January 1), in 
addition to any year-long reporting requirements, beginning in 2018. 
This shorter reporting/performance period will provide a necessary 
``on-ramp'' for many specialty physicians who will be new to the 
program. And, it is consistent with approaches CMS has taken previously 
with the Medicare EHR Incentive Program, which currently utilizes a 90-
day reporting period.

The MIPS Quality Performance Category

For the quality performance category, CMS proposes to adopt 
requirements similar to those under the existing Physician Quality 
Reporting System (PQRS). We are concerned with this approach, because, 
as you know, PQRS continues to have relatively low participation rates, 
and it has been difficult educating our members on the complexities of 
the PQRS. Furthermore, some of CMS's proposals under the quality 
performance category would make it more difficult for specialty 
providers to be successful under the MIPS. Specifically:

      The Removal of Measures Groups: CMS proposes to no longer 
include Measures Groups as a data submission method for purposes of the 
quality performance category. In its place, CMS is proposing specialty-
specific measure sets, which CMS believes will address confusion in the 
quality measure selection process. Some of the specialties represented 
in the Alliance heavily rely on Measures Groups to meet quality 
reporting requirements under the current PQRS program and would 
appreciate the opportunity to continue meeting the quality reporting 
requirements under the quality performance category in the same way. By 
proposing to do away with this reporting mechanism, CMS is severely 
limiting meaningful quality reporting options available to many 
specialists, particularly those in small practices. Similarly, in many 
instances, the proposed removal of measure groups will either leave no 
meaningful measures for certain specialties and subspecialties or 
greatly diminish the value of the measures that CMS proposes to retain 
as stand-alone measures.

      Increasing the Data Completeness Threshold: CMS also proposes to 
revise its data completeness thresholds such that individual MIPS 
eligible clinicians submitting via Part B claims would need to report 
on 80 percent of his/her Medicare Part B-only patients; whereas 
individual MIPS eligible clinicians and groups submitting via Qualified 
Clinical Data Registry (QCDR), qualified registry, and EHR would need 
to report on 90 percent of their Medicare and non-Medicare patients. We 
very much oppose this proposal and request that CMS lower the reporting 
thresholds for all reporting mechanisms to 50 percent, which is 
consistent with the current PQRS reporting requirements. As an 
alternative, CMS could consider simply requiring reporting on 20 
consecutive patients, which would be consistent with CMS' current 
threshold for Measures Groups under the PQRS program.

The MIPS Resource Use Performance Category

We are deeply concerned about the use of the VM measures in the MIPS 
program, particularly in the initial years. A CMS report on the result 
of the 2016 VM program (based on 2014 performance) showed that only 128 
groups exceeded the program's benchmarks in quality and cost efficiency 
and earned a 2016 payment incentive. In contrast, physicians in 5,418 
groups that failed to meet minimum reporting requirements saw a 
``-2.0%'' decrease in their Medicare payments in 2016 and physicians in 
59 groups saw a decrease in their Medicare payments based on their 
performance on cost and quality measures under the VM. The disparity in 
groups earning an incentive or receiving a negative adjustment for the 
2016 VM is great. It is clear these measures are not ready for prime 
time, and the need to further refine and evaluate episode-based cost 
measures is essential.

Furthermore, in calculating the performance under the resource use 
performance category, CMS proposes to include several clinical 
condition and treatment episode-based measures that have been reported 
in Supplemental Quality and Resource Use Reports (sQRURs) or were 
included in the list of the episode groups developed under section 
1848(n)(9)(A) of the Act published on the CMS website. We are concerned 
about the premature application of these cost measures, which have not 
been adequately vetted by specialty care providers given their limited 
use. Most of the cost measures are new, only recently having been put 
forward for comment as part of CMS's Episode Groups Request for 
Comment. The remaining measures may have been included in sQRURs, 
however, very few clinicians understood (or understand) how to access 
or interpret their QRURs or sQRURs.

For these reasons, we strongly urge CMS to use its authority under 
MACRA to re-weight this category to zero.

The MIPS Clinical Practice Improvement Activity (CPIA) Category

Despite the inclusion of 94 unique activities in the Clinical Practice 
Improvement Activity (CPIA) inventory, the vast majority of activities 
are focused on activities more appropriate for primary care providers. 
There are very few activities that create a pathway for specialists to 
earn credit for their engagement in clinical practice improvement. The 
list of proposed CPIAs neither includes the vast majority of activities 
we suggested for inclusion nor did CMS acknowledge that it had at least 
considered these activities for inclusion. We urge CMS to reconsider 
including these activities in the proposed rule. They include:

      Attendance and participation in Accreditation Council for 
Continuing Medical Education (ACCME)-accredited continuing medical 
education (CME) and non-CME events, such as the specialty and 
subspecialty society conferences and events, including those that are 
web-based, that exceed certification requirements;
      Fellowship training or other advanced clinical training 
completed during a performance year;
      Participation in morbidity and mortality (M&M) conferences;
      Taking emergency department (ED) call as part of Expanded 
Practice Access,
      Voluntary practice accreditation, such as accreditation achieved 
by the National Committee on Quality Assurance (NCQA), Accreditation 
Association for Ambulatory Health Care (AAAHC), The Joint Commission 
(TJC), or other recognized accreditation organizations;
      Demonstration of incorporation of evidence-based practices and 
appropriate use in clinician practices, using evidence-based clinical 
guidelines, appropriate use criteria, ``Choosing Wisely'' 
recommendations, etc.;
      Engagement in state and local health improvement activities, 
such as participation in a regional health information exchange or 
health information organization;
      Engagement in private quality improvement initiatives, such as 
those sponsored by health plans, health insurers, and health systems; 
and
      Participation in other federally sponsored quality reporting and 
improvement programs not already affiliated or considered under the 
MIPS program.

CMS intends, in future performance years, to begin measuring CPIA data 
points for all eligible clinicians and to award scores based on 
performance and improvement. We strongly oppose this proposal, 
particularly given there are no baseline or benchmark data available 
for comparison. In addition, we believe that requiring this diverts 
from the Congressional intent of including this proposal in the first 
place.

The MIPS Advancing Care Information Performance Category

We are sorely disappointed in the proposals included in the Advancing 
Care Information performance category. The implementation of programs 
established under MACRA afforded CMS a unique opportunity to 
drastically change the direction of the meaningful use program for 
physicians. Since the fall, CMS promised a more flexible program in 
response to physician concerns heard around the country. Instead, the 
measures that CMS has retained are every bit the same and even more 
difficult with the proposed removal of most exclusions. Under CMS's 
base scoring proposals, they must still report on at least one patient 
for each of the measures in the objectives that require reporting a 
numerator/denominator. MIPS eligible clinicians will continue to be 
forced to report on measures that are not meaningful to their practice 
and patient populations. While CMS touts these modifications as a 
departure from the previous ``all-or-nothing'' approach to the Medicare 
EHR Incentive Program, specialty physicians observe little change in 
how they can approach the new requirements and be successful.

The MIPS Composite Performance Score Methodology

We are deeply concerned about the scoring methodology for MIPS. 
Alliance member organizations have reviewed the proposals in great 
detail, yet we continue to find the proposals extremely complex and 
confusing. We recognize that, to provide flexibility, the scoring will 
be more difficult. However, if our most sophisticated and knowledgeable 
volunteer physician leaders are struggling to understand the scoring 
proposals, how does CMS expect the vast majority of physicians in 
practice to understand?

The proposed methodology also maintains the current silos of 
performance scoring, despite the fact that scoring is all rolled up 
into a composite performance score. To move toward a more value-driven 
health care system, it seems that the scoring should provide physicians 
with meaningful and actionable information that leads them toward that 
goal.

We request that CMS rethink its scoring methodology and make 
modifications that would standardize, streamline, and maintain 
consistency so that MIPS eligible clinicians are able to understand and 
respond appropriately.

                   Alternative Payment Models (APMs)

Specialty physicians are at a disadvantage as the proposed Advanced 
Alternative Payment Models (APMs) remain primary care-focused, leaving 
specialty physicians with few APM participation options. Despite its 
Request for Information (RFI) on Specialty Practitioner Payment Model, 
the Center for Medicare and Medicaid Innovation (CMMI) has not made a 
concerted effort to ensure specialists have a pathway toward engaging 
in APMs. Only two models currently cover specialty medicine--the 
Oncology Care Model and the Comprehensive Care for Joint Replacement 
Model, the latter of which CMS did not propose to qualify as an 
Advanced APM.

We continue to be frustrated by the lack of APM participation options 
available to specialty physicians given the intent of MACRA to move 
physicians away from traditional fee-for-service and into payment 
models that better focus on cost and quality. We urge CMS to offer 
guidance on how APMs that did not meet the proposed Advanced APM 
criteria could be altered to meet the criteria. It seems as if in many 
cases, it is simply a lack of quality metrics or concerted use of 
certified electronic health record technology (CEHRT) that limit those 
models from Advanced APM status. If that is the case, we request that 
CMS work with the developers and participants of those models to make 
modifications that lead to Advanced APM designation.

Distinguishing Specialty Care Physicians

Finally, member organizations in the Alliance represent a broad array 
of specialty and subspecialty organizations. However, CMS' current 
proposals do not recognize the intricacies of all of these specialties 
and subspecialties. For example, Mohs micrographic surgeons are 
identified in claims and other datasets as relatively low-quality and/
or high-cost providers because they are being compared to the whole of 
dermatology. Mohs surgeons focus their practice on skin cancer 
diagnosis and treatment, unlike a lot of other dermatologists who may 
be focused on other conditions, such as acne.

Individually, many of these subspecialty providers have urged CMS to 
use ``Level III, Area of Specialization'' codes from the Healthcare 
Provider Taxonomy code set to develop quality and cost benchmarks for 
these providers to at least somewhat level the playing field. We 
request that CMS begin the process for developing appropriate 
benchmarks for these providers using the aforementioned ``third-tier'' 
taxonomy codes. Without being able to more accurately define the role 
of a provider, it would be difficult for CMS to truly measure 
performance.

Thank you again for taking into consideration our written comments. The 
Alliance of Specialty Medicine looks forward to working with the 
committee on addressing these issues to ensure the successful 
implementation of MACRA and we would be happy to discuss our concerns 
with you, as well as any other questions you may have going forward.

                                 ______
                                 
                  American College of Physicians (ACP)

                 25 Massachusetts Avenue, NW, Suite 700

                       Washington, DC 20001-7401

                        Statement for the Record

The American College of Physicians (ACP) applauds Chairman Hatch and 
Ranking Member Wyden for holding this hearing on the implementation of 
the Medicare Access and CHIP Reauthorization Act (MACRA). The College 
appreciates the opportunity to provide a statement to the Senate 
Finance Committee that includes our recommendations to improve the 
implementation of MACRA. These recommendations are based on a comment 
letter that ACP sent last month to the Centers for Medicare and 
Medicaid Services (CMS) Acting Administrator Andy Slavitt that provides 
our ideas for improvements to the proposed rule that was released 
earlier this year by CMS to implement MACRA.

ACP has developed three principles that Congress should use to ensure 
that this law is implemented in a manner that truly improves care for 
Medicare beneficiaries and thus the policy that is developed to guide 
these new value based payment programs must be thoughtfully considered 
in that context. We believe that these principles are also consistent 
with the manner that Congress intended the law to be implemented. These 
principles are:

      That the new payment systems should reflect the lessons from 
current and past programs and effectively allow for ongoing innovation 
and learning. The agency must constantly monitor the evolving 
measurement system to identify and mitigate any potential unintended 
consequences.

      CMS should work to ensure that patients, families, and their 
relationships with their physicians are at the forefront of thinking in 
developing the new payment systems.

      CMS should collaborate with specialty societies, frontline 
clinicians, and Electronic Health Records (EHRs) vendors in the 
development, testing, and implementation of measures with a focus on 
integrating the measurement of and reporting on performance with 
quality improvement and care delivery and decreasing clinician burden.

We ask Congress to not only use these principles to guide the oversight 
process, but also offer a series of concrete recommendations to CMS 
that we believe will help ensure that the law is implemented in a 
manner that serves the interests of our patients and also follows 
Congressional intent. We look forward to working with Congress to 
ensure that these recommendations are implemented as our physicians 
prepare to move toward a new value-based payment system.

Among the detailed suggestions, we have outlined a set of top priority 
tasks for CMS, including the following:

      Implement an alternative Merit-Based Incentive Payment System 
(MIPS) scoring methodology, developed by ACP, which combines, 
simplifies, aligns, and reduces the complexity of the four reporting 
categories.

      Provide better opportunities for small practices to succeed, 
including via the creation of virtual groups for assessment under MIPS, 
while holding practices of nine or fewer eligible clinicians harmless 
from any potential downward adjustments until such time that a virtual 
groups option is made available.

      Make significant improvements to simplify, harmonize and reduce 
the burden of quality measurement and reporting for MIPS both over the 
short and longer term.

      Simplify reporting requirements within CMS's Advancing Care 
Information (ACI) program that is to replace the current Meaningful Use 
program.

      Change the start date for the First Performance Year in the 
Quality Payment Program (QPP) to July 1, 2017.

      Improve the opportunities for Patient-Centered Medical Homes 
(PCMHs) and PCMH Specialty Practices in MIPS and for PCMHs as advanced 
Alternative Payment Models (APMs).

      Implement changes that would make more advanced APMs available 
for physicians in all specialties, especially including those in 
internal medicine and its subspecialties.

At this time, we believe that CMS is sincerely open to making 
improvements from its proposed rule, and do not believe that it is 
necessary or desirable for Congress to make any legislative changes to 
MACRA. Rather, we encourage the Senate Finance Committee, and the House 
Medicare committees of jurisdiction, to exercise oversight over CMS's 
implementation, and specifically, to be supportive of the following 
recommendations in ACP's comment letter on the NPRM.

Implement an Alternative Scoring Methodology for MIPS

ACP recommends that CMS simplify and clarify performance scoring in the 
final rule to allow physicians to better assess the scoring and 
weighting within each category. The scoring approach included in the 
proposed rule had different points systems and scales for each of the 
four reporting categories, making it unnecessarily complicated; ACP's 
alternative would put the points all on the same scale, combining them 
into one simplified and harmonized program as Congress intended.

ACP proposed to CMS a more simplified alternative that would make all 
available points within the quality component add up to a total of 50 
points, not 80--which then counts for 50 percent; the points within 
resource use would add up to a total of 10 or less; the points within 
Clinical Practice Improvement Activities (CPIA) would add up to 15; and 
the points within ACI would add up to 25 (and not 131, with only 100 of 
those points actually ``counting,'' as currently proposed).

By simplifying the scoring to allow the maximum points for each measure 
or activity to directly translate to its contribution to the overall 
CPS, the scoring will be streamlined to better account for MIPS as one 
comprehensive program rather than silos for each performance category. 
This will allow physicians to better focus their efforts on the 
activities and measures that are most meaningful to their patients and 
practice.

Provide Better Opportunities for Small Practices to Succeed

Section 1848(q)(5)(I) of the Act establishes the use of voluntary 
virtual groups for certain assessment purposes. The statute requires 
the establishment and implementation of a process that allows an 
individual MIPS eligible clinician (EC) or a group consisting of not 
more than 10 MIPS ECs to elect to form a virtual group with at least 
one other such individual MIPS EC or group of not more than 10 MIPS ECs 
for a performance period of a year. While the rule recognizes this 
requirement, it proposes to delay the onset of this provision until the 
2018 performance year based on identified significant barriers 
regarding the development of a technological infrastructure required 
for successful implementation and the operationalization of provisions 
that would make this a conducive option for MIPS ECs or groups.

The College believes that the implementation of the virtual groups' 
provision is an important step towards establishing a viable and 
effective quality payment program. It will allow small practice 
clinicians to aggregate their data to allow for more reliable and valid 
measurement as well as serve as a platform to facilitate shared 
accountability and collaborative efforts. While we recognize and 
appreciate the barriers mentioned towards implementation in time for 
the 2017 performance period, ACP is not supportive of the planned delay 
in implementation. It places small practices in a situation in which 
payment adjustments based upon the 2017 performance year will likely be 
based upon suspect data.

Therefore, ACP strongly urges CMS to include in the final rule for the 
2017 performance period a policy that allows small practices to join 
together as virtual groups for the purposes of MIPS assessment in the 
initial performance period. This is a critical option that small 
practices should be permitted in order to allow greater assessment 
opportunities under MIPS. To accomplish creating a virtual group option 
for the first performance period, the College notes that CMS can 
utilize Interim Final Rulemaking processes.

If the Agency is unable to provide a virtual group option through 
rulemaking for the first year, then as a backup, ACP recommends that 
CMS treat small practices in a manner similar to how they were treated 
in the phase-in of the Value-based Payment Modifier (VBM) program. 
Under this option, CMS would allow solo clinicians and groups of 2-9 
ECs who report under MIPS to be held harmless from any potential 
downward adjustments until such time that a virtual groups option is 
made available. They should still be eligible for upward adjustments.

Make Significant Improvements to Quality Measurement and Quality 
Reporting for MIPS and Over the Longer Term

In our comments on the quality component of MIPS, it seems imperative 
to reiterate our call for CMS to use the opportunity provided through 
the new MACRA law to actively build a learning health and healthcare 
system. It is critically important that the new payment systems that 
are designed through the implementation of MACRA reflect the lessons 
from the current and past programs and also effectively allow for 
ongoing innovation and learning. Overall, quality measurement must move 
toward becoming more relevant and accurate, and toward effective 
approaches of measuring patient outcomes.

We provide these specific recommendations for CMS to properly implement 
the new Quality Performance Category:

    1.  The College recommends that CMS collaborate with specialty 
societies, frontline clinicians, and EHR vendors in the development, 
testing, and implementation of measures with a focus on integrating the 
measurement of and reporting on performance with quality improvement 
and care delivery and on decreasing clinician burden.

It is critically important to constantly monitor the evolving 
measurement system to identify and mitigate any potential unintended 
consequences, such as increasing clinician burden and burn-out, 
adversely impacting underserved populations and the clinicians who care 
for them, and diverting attention disproportionately toward the things 
being measured to the neglect of other critically important areas that 
cannot be directly measured (e.g., empathy, humanity).

    2.  We recommend that ideally any measures CMS proposes to use 
outside of the core set identified by the Core Quality Measures 
Collaborative be endorsed by the Measure Application partnership.

ACP is appreciative that CMS has proposed to reduce the overall number 
of measures required for reporting from nine measures to six, as well 
as removing the requirement that these measures fall across all of the 
National Quality Strategy domains. However, the College would like to 
reiterate our overall concerns with the performance measures that are 
currently in use within the Physician Quality Reporting System (PQRS) 
program, as well as many of those proposed for use within MIPS. To 
begin to address this issue in the short term, in our comments on the 
draft Measurement Development Plan (MOP), ACP called on CMS to utilize 
the core set of quality measures identified by the Core Quality 
Measures Collaborative.

    3.  CMS should consider the recommendations made by ACP's 
Performance Measurement Committee with regard to measure selection 
within MIPS.

These recommendations, as listed on the ACP website (with a thumbs up, 
down, or sideways), are based upon a scientific review process that 
involves four domains: purpose and importance to measure, clinical 
evidence base, measure specifications, and measure implementation and 
applicability.

    4.  CMS should take concrete actions to provide clear options for 
those specialties and subspecialties that may be most impacted by too 
few appropriate measures.

Many of these specialties may already be impacted under the current 
proposal--particularly by a lack of outcomes and/or high priority 
measures--and certainly would be affected if a number of the measures 
available were to be reduced through a more focused and needed approach 
of ensuring measure validity, clinical relevance, and ability to 
implement. These actions should include:

          Developing a process to determine, in advance of the 
reporting year, which quality measures are likely applicable to each 
EC--and only holding them accountable for these relevant measures 
(i.e., weighting performance on the remaining measures higher, rather 
than penalizing them with a score of zero on unreported measures).

          Putting a process in place, for the short term, to address 
the significant issues of validity and ability to implement associated 
with using measures that are not endorsed by the National Quality Forum 
(NQF), and/or ACP recommended.

          Establishing safe harbors for entities that are taking on 
innovative approaches to quality measurement and improvement and also 
provide clear protections for individual clinicians who participate in 
these types of activities--this could be done by having the entities 
register certain measures as ``test measures.''

          Ensuring that the flexibility for Qualified Clinical Data 
Registries (QCDRs) to develop and maintain measures outside of the CMS 
selection process is protected.

Simplify Reporting Requirements for the ACI Program

ACP proposed significant improvements to simplify the reporting 
requirements for the ACI program that is to replace Meaningful Use in 
the new law. ACP has been a consistent advocate of physicians and other 
clinicians leveraging EHRs and other health information technology (IT) 
to improve care. As such, ACP was a strong supporter of the goals of 
the HI-TECH Act and of the Meaningful Use program, although we have 
expressed concerns regarding the implementation of the Meaningful Use 
program, specifically due to the uniform (or one-size-fits-all) and 
overly prescriptive approach taken by CMS, which turned what should 
have been an incentive program towards specialty-specific optimization 
of the emerging health IT infrastructure into a ``check the box'' 
compliance exercise. That said, the ACP believed that the Meaningful 
Use program accomplished many of its objectives, and with the coming of 
Medicare's QPP via MACRA, CMS had a golden opportunity to fix 
Meaningful Use into something truly meaningful for physicians, 
clinicians, and patients.

Instead, what is proposed for Meaningful Use inside of MIPS is even 
more complicated than what was proposed for Stage 3, and with even 
higher thresholds. This legacy--if not significantly changed in the 
MACRA/MIPS final rule, will not be one of using the enabling 
infrastructure of health IT to improve quality and value--but rather 
using it to satisfy regulatory compliance. What doctors, clinicians, 
and clinical informatics leaders should be doing now--analyzing and 
improving workflows and targeted use of health IT for specific quality 
and value purposes--will not happen. Instead, just as has occurred with 
each stage of Meaningful Use, they will be taking significant time to 
understand the rules and the FAQs that are certain to follow and 
continuing to develop workarounds and configuration ``gimmicks,'' 
particularly where the metric is not consistent with workflow.

In summary, the ACP believes that there is a place for Meaningful Use 
within MIPS, but it is one that plays a supportive role to improving 
care quality and value, and not one that promotes care information over 
patient care. Please see our specific recommendations and comments 
below, as well as an alternate proposal for Meaningful Use within MIPS, 
which we believe is responsive to the legislative requirements of 
MACRA.

    1.  We urge CMS to simplify the reporting requirements and scoring 
methodology within the proposed ACI Category and not require the volume 
and complexity specified in the base and performance scores.

In the new ACI system offered in the proposed rule, each practice will 
be challenged to track and manage so many activities of so many people 
and systems if it is to successfully complete the ACI component. The 
likelihood of a costly error will be high. Further, the amount of 
effort that will be required to perform, manage, and report all the 
measures that make up ACI is more than would have been required under 
the Meaningful Use Stage 2 modification rule for 2017. The number of 
required activities greatly exceeds the numbers for the other 
components of MIPS.

    2.  For the 2017 performance period, ACP recommends that the ACI 
measurement period be 90 days instead of the full calendar year as done 
previously with the EHR Incentive Program performance period.

It is extremely unlikely that all ECs will be prepared to report 
measures in the new system on January 1, 2017. Therefore, many ECs will 
be required to report on CMS's alternate ACI proposal of modified 
objectives for the 2017 performance period. CMS should acknowledge this 
in the final rule. Assuming a best case scenario, most practices will 
spend the 2017 MIPS performance period converting from a 2014 Certified 
Electronic Health Record Technology (CEHRT) system to a 2015 CEHRT 
system that will negatively impact their ability to perform all ACI 
measures for the full calendar year.

    3.  The College urges CMS to modify the base score component of ACI 
and remove the threshold requirements of 1 or ``yes'' for all proposed 
base measures except for the protecting patient health information 
attestation which ACP believes is integral to the use of Health IT.

This modification will support CMS's public statements and those of its 
Acting Administrator, Mr. Slavitt, outlining goals that give ECs the 
ability to select measures that are relevant and that move them forward 
in using health IT to improve value of care. ECs are going to need 
health IT capabilities that they do not yet have, and the ACI program 
should be used as a vehicle to help them make the needed transitions.

The proposed base measures, which are the same measures that physicians 
have already found to be cumbersome and inappropriate, do little to 
help ECs move forward.

Change the Start of the Initial Performance Period Under the QPP to 
July 1, 2017

The College urges CMS to delay the initial performance period under the 
OPP to July 1, 2017 rather than the proposed January 1, 2017 start 
date. The performance period should remain as 1 year in length overall, 
ending on June 30, 2018. ACP believes that this later start date for 
the performance period better matches Congressional intent that the 
performance period be as close to the payment adjustment period as 
possible, while still allowing for the related payment adjustments to 
take place in 2019 as mandated by MACRA.

Given that the final rule implementing the initial performance period 
for MACRA will likely not be issued until October 2016 at the earliest, 
CMS, physician organizations, ECs, and other affected parties would 
have less than three months to prepare for implementation of an 
entirely new Medicare payment system, OPP. While it may be feasible for 
the physician fee schedule to be issued and implemented in a short time 
frame, the MACRA rule is different because it is not simply issuing 
revisions to a rule that has previously been implemented. Rather the 
MACRA rule entails digesting long, complex policies on MIPS and APMs 
that have never been in existence. Significant efforts will be required 
by CMS, physician organizations, and others to prepare educational 
materials and tools and provide practices opportunities to learn how 
they can succeed in OPP and best meet the needs of their patients. CMS 
should also use the time between the issuance of the final rule and the 
later July 1, 2017, start date to refine the feedback mechanisms that 
will be utilized for OPP performance and allow for appropriate user 
feedback and end-to-end testing.

Improve the Opportunities for PCMHs and PCMH Specialty Practices in 
MIPS and for PCMHs as Advanced APMs

PCMHs and PCMH Specialty Practices in MIPS

The College sincerely appreciates CMS' active implementation of this 
component of the law--as it is critically important to facilitate 
movement by all clinicians toward care that is truly patient-centered, 
coordinated, and comprehensive. ACP has been a leader in supporting the 
medical home model, particularly in light of the plethora of currently 
available research linking the model to higher quality and lower costs.

ACP recognizes that there will be a significant number of clinicians in 
PCMH practices that will be included in the MIPS pathway, even if CMS 
establishes a deeming process that would allow clinicians in medical 
home practices participating in programs run by states, other non-
Medicare payers, and employers to become qualified advanced APM 
participants. These MIPS PCMH practices have taken significant steps to 
improve care for their patients through ongoing, meaningful, practice 
improvement approaches and therefore should be given the opportunity 
for full credit within the CPIA performance category. A number of these 
practices will, in fact, fall within the proposed definition from the 
agency (as outlined above); however, ACP believes that a number of 
clinicians in truly innovative PCMH practices could be left out of this 
opportunity and will therefore have the burden of documenting 
additional CPIA.

ACP recommends that CMS broaden its definition of the PCMH for the 
purposes of full CPIA credit to specifically be inclusive of programs 
that have a demonstrated track record of support by non Medicare 
payers, state Medicaid programs, employers, and/or others in a region 
or state (but that do not yet meet all of the requirements to be deemed 
an advanced APM):

      The programs to be included should be clearly articulated by CMS 
in advance, along with transparent criteria and methodology for the 
addition of new PCMH programs. With regard to ``comparable specialty 
practice,'' ACP also recommends that CMS broaden its definition to not 
only include those practices recognized by National Committee for 
Quality Assurance (NCQA), but also those practices that may be 
certified in some manner by other nationally recognized accreditation 
bodies or programs implemented by non-Medicare payers, state Medicaid 
programs, employers, and others in a region that may become available.

      Additionally, the College recommends that specialty practices 
should be able to attest directly to CMS and document that they meet 
standards comparable to those for primary care medical homes as 
recognized through an accreditation body, other certification process, 
or direct application to CMS or one of its carriers.

PCMHs as Advanced APMs--There Should Be Multiple Pathways Available

The College commends CMS for its recognition within the proposed rule 
regarding the unique status of the medical home within the advanced APM 
portfolio. However, we are greatly concerned that CMS did not meet 
Congress's intent that medical homes be able to qualify as [advanced] 
APMs without being required to bear more than nominal risk (even via 
the less stringent Medical Home Model Standard for financial risk and 
nominal amount). The following explains our interpretation of the 
Congressional intent of the law and proposes specific steps that should 
be taken to modify the proposed rule to meet this intent.

A reasonable reading and interpretation of the statute provides what we 
believe to be the clear congressional intent--that CMS should allow a 
medical home to qualify as an [advanced] APM, without bearing more than 
nominal financial risk; if it is a medical home that meets criteria 
comparable to medical homes expanded under section 1115A(c). While this 
language is included in the discussion of the all-payer option that 
begins in 2021 (which is when other payer payments can be counted 
toward the threshold to determine if one is a qualifying APM 
participant), it makes clear that the intent of the law is to 
incentivize medical homes that are aligned with Medicare initiatives--
and therefore ACP sees no reason to unnecessarily limit the initial 
opportunities for practices to become advanced APMs that are clearly 
meeting comparable criteria.

Criteria ``comparable to medical homes expanded under section 
1115A(c)'' means:

(1) the Secretary determines that such expansion is expected to--

      (A)  reduce spending under applicable title without reducing the 
quality of care; or

      (B) improve the quality of patient care without increasing 
spending;

(2) The Chief Actuary of the Centers for Medicare and Medicaid Services 
certifies that such expansion would reduce (or would not result in any 
increase in) net program spending under applicable titles; and

(3) The Secretary determines that such expansion would not deny or 
limit the coverage or provision of benefits under the applicable title 
for applicable individuals. In determining which models or 
demonstration projects to expand under the preceding sentence, the 
Secretary shall focus on models and demonstration projects that improve 
the quality of patient care and reduce spending.

In sum, the Congressional intent and even the statutory language and 
criteria clearly do not require medical homes to bear more than nominal 
financial risk in order to qualify for payments as [advanced] APMs.

Nor does it require that the Secretary and the Chief Actuary determine/
certify that medical homes would reduce net program spending--rather, 
the applicable standard is that the Secretary determines they would 
``reduce spending . . . without reducing the quality of care'' or 
``improve the quality of patient care without increasing spending'' and 
the Chief Actuary certifies they ``would reduce (or would not result in 
any increase in) net program spending.'' The College believes that 
there is abundant evidence that medical homes, at the very least, can 
improve the quality of care without increasing spending (although there 
is growing evidence from the many PCMH programs around the country that 
can also bring about reductions in costs).

Therefore, ACP recommends that CMS take the following steps to provide 
multiple pathways for medical homes to be included in the advanced APM 
pathway, in addition to the Comprehensive Primary Care Plus pathway 
proposed by CMS:

    1.  Immediately initiate plans to undertake an expedited analysis 
of the results of the Comprehensive Primary Care Initiative (CPCi) to 
determine whether the statutory requirements for expansion by the 
Secretary are met.

    2.  Establish a deeming program or process to enable practices 
enrolled in medical home programs run by states (including state 
Medicaid programs), other non-Medicare payers, and employers as being 
deemed to have met criteria ``comparable to medical homes expanded 
under section 1115A(c).''

    3.  Allow inclusion of medical home programs as advanced APMs that 
meet the Medical Home Model Standard for financial risk and nominal 
amount as outlined in the proposed rule.

Implement Changes That Would Make More Advanced APMs Available for 
Physicians in All Specialties, Especially Including Those in Internal 
Medicine and its Subspecialties

The College expresses significant concern regarding the limited number 
of opportunities currently available for non-primary care specialists/
subspecialists to participate in recognized APMs and Advanced APMs.

ACP makes the following specific recommendations to address this 
problem:

    1.  Provide priority for consideration through the Physician 
Focused Payment Models Technical Advisory Committee (PTAC) and for 
Center for Medicare and Medicaid Innovation (CMMI) testing for models 
involving physician specialty/subspecialty categories for which there 
are no current recognized APMs and Advanced APM options available. We 
further recommend that CMS provide a clear pathway for models 
recommended by PTAC to be implemented as APMs under MACRA.

    2.  Reduce the nominal risk requirement for potential advanced APMs 
other than the Medical Home model. The current nominal risk requirement 
for these models is onerous--essentially requiring a maximum risk of 4 
percent of total health expenditures for the attributed population.

    3.  Create a platform to expedite the testing for APM recognition 
of bundled payment and similar episodes of care payment models.

    4.  The College recommends the addition of a new Track within the 
Medicare Shared Savings Program (MSSP) that helps bridge the transition 
for one-sided to two-sided risk. The feedback we have received from our 
members currently involved in Track One MSSP is that despite their 
ability presently to stay within Track One for a second 3-year 
contractual term, few of the participating physician-led entities 
currently feel they would be able--even after that 6-year period--to 
assume the currently required downside risk of Tracks 2 and 3. 
Therefore, as a means of addressing this issue, the College has 
recommended that CMS add a Track to the MSSP program that includes two-
sided risk, but at a level that would not place the participating 
practices at unreasonable financial jeopardy .

Summary and Conclusion

We look forward to working with the Congress to ensure that the new 
MACRA law is implemented in a successful manner that is consistent with 
the intent of Congress. The recommendations we offered to CMS in our 
letter, as summarized above, would serve to ensure the law truly 
improves care for Medicare beneficiaries. With these improvements, the 
QPP could go a long way to achieving Congress' goal of aligning 
payments with high quality care without imposing more unnecessary 
administrative burden on physicians.

                                 ______
                                 
      American Congress of Obstetricians and Gynecologists (ACOG)

                          409 12th Street, SW

                       Washington, DC 20024-2188

                          Phone: 202-638-5577

                     Internet: http://www.acog.org/

On behalf of the American Congress of Obstetricians and Gynecologists 
(ACOG), representing over 57,000 physicians and partners in women's 
health, please accept our statement for the record for your hearing 
titled ``Medicare Access and CHIP Reauthorization Act of 2015: Ensuring 
Successful Implementation of Physician Payment Reforms.'' We thank the 
Senate Finance Committee for its leadership and crucial role in 
repealing the flawed Medicare Sustainable Growth Rate formula, and for 
its work enacting the bipartisan Medicare Access and CHIP 
Reauthorization Act (MACRA). Your continued partnership during the next 
phase of this process is highly valued and will make certain that the 
law is implemented as you intended and that the new program meets the 
needs of patients and physicians.

ACOG was, and continues to be, very supportive of MACRA, truly landmark 
legislation that holds the promise of improving our Nation's health. We 
applaud your work in getting MACRA passed into law and especially 
appreciate that you ensured that physicians would be integrally 
involved in determining the specifics of implementation, rather than 
having to struggle under a top-down, bureaucratically designed program. 
This aspect of the legislation, as many others, is a tremendous 
improvement.

Successful implementation of MACRA should ensure that women's unique 
health needs are being met. It is with that goal in mind that we 
provide the following comments regarding the Centers for Medicare and 
Medicaid Services' (CMS) proposed rule establishing the Quality Payment 
Program.

Low-Volume Threshold

ACOG remains incredibly appreciative that Congress included a statutory 
requirement allowing low volume Medicare providers to be excluded from 
reporting in the Merit-based Incentive Payment System (MIPS).

Wisely, the law is written in a way that doesn't specify the threshold, 
but leaves it up to CMS to determine the threshold after consultation 
with the physician community. CMS has proposed a threshold of 100 
patients and $10,000 in submitted charges. Under this threshold, many 
ob-gyns, particularly those who deliver surgical care, would be 
required to invest in reporting infrastructure, but may not meet the 
20-case minimum for measures to be scored, making them ineligible for 
positive payment adjustments.

While 92 percent of obstetrician-gynecologists (ob-gyns) participate in 
Medicare, many do not have a significant proportion of Medicare 
beneficiaries in their patient panels.\1\ The low-volume threshold 
proposed by CMS assesses volume based on the number of patients seen 
and the submitted charges associated with caring for Medicare patients. 
However, the specific threshold proposed by CMS does not accurate ly 
reflect ob-gyn practice. Ob-gyns often provide surgical care for female 
Medicare beneficiaries. The cost of surgery may cause ob-gyns to exceed 
CMS' proposed financial cap even if they see few Medicare patients 
during a performance period. To ensure that ob-gyns are not required to 
report without the ability to be scored due to too few cases for 
measures, the financial cap should be raised from the proposed $10,000 
to $30,000.
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    \1\ American Congress of Obstetricians and Gynecologists. (2013). 
2013 Socioeconomic survey of ACOG Fellows. Retrieved from: http://
www.acog.org/-/media/Departments/Practice-Management-and-Managed-Care/
2013SocioeconomicSurvey.pdf.

In addition, CMS should align the patient cap with the Comprehensive 
Primary Care Plus (CPC+) program's patient panel requirement of 150 
Medicare Part B patients, as opposed to the proposed 100 patient 
threshold. While ob-gyns are currently excluded from participating in 
CPC+, it is inappropriate to hold any practice to two different low-
volume thresholds. Two different thresholds will cause confusion and 
keep practices that fall in the gap between programs from making the 
needed investments to move to comprehensive, coordinated, value-based 
care. This change to a consistent 150 patient threshold will help 
---------------------------------------------------------------------------
improve the program for all physician types, including ob-gyns.

Furthermore, the definition of low-volume providers should only apply 
to individual clinicians. CMS should develop a new, separate definition 
if the agency decides that groups should also have a lowvolume 
threshold. Low-volume ob-gyns should be able to choose whether to 
report individually or with a group if practice partners do not meet 
the low-volume threshold.

We believe proper implementation of this provision would establish a 
threshold of 150 patients and $30,000 in charges. Our proposed 
threshold would help those practices, as well as ob-gyn surgeons who 
provide high-cost services, but see few Medicare beneficiaries.

We were pleased to hear during his remarks before the Senate Finance 
Committee that CMS Acting Administrator Slavitt is open to alternative 
proposals to help low-volume and small practices. We hope that you 
would encourage CMS to strongly consider our suggested change.

MIPS Performance Period

Consistent with many of our colleagues in the physician community, ACOG 
is deeply concerned with the proposed start date of January 1, 2017 for 
the first performance period. We feel strongly that the first 
performance period should begin no earlier than July 1, 2017 and be 
shortened to 6 months to ensure that there is a greater opportunity to 
educate ob-gyns on the Quality Payment Program. Delaying the start date 
for the first performance period will increase the odds that CMS has 
the appropriate systems and technical assistance in place to support 
ob-gyns and other providers as they begin reporting on performance.

ACOG is committed to partnering with CMS and our members to enable ob-
gyns to thrive under MACRA. However, few ob-gyns will be able to 
succeed under the currently proposed timeline, especially since many 
ob-gyns are not currently participating in the core components of 
MIPS--the Physician Quality Reporting System (PQRS), Value-based 
Payment Modifier (VM) program, and the Medicare Electronic Health 
Record (EHR) Incentive Program. In order to successfully participate in 
the program, ob-gyns need several months to put into place the data 
collection systems needed to facilitate reporting. The short timeframe 
between the finalization of the rule and January 1 is not enough time 
to ensure successful participation.

Setting the performance year too soon will also compromise the ability 
of vendors, registries, EHRs, and others to update their systems to 
meet program requirements. The MIPS program asks that these entities 
incorporate a significant number of new measures, including an entirely 
new category of clinical practice improvement activities (CPIAs). We 
are concerned that, given the proposed performance period start date, 
there will be inadequate time to not only include new measures but also 
to test and ensure the data submitted is accurate and reliable. The 
time frame proposed does not allow for these entities to validate new 
data entry and testing tools, which can also exacerbate usability 
issues and add to the existing problems with this technology. 
Furthermore, EHRs are expected to undergo a significant overhaul of 
their systems to comply with the 2015 certification requirements. To 
date, however, there are no 2015 certified products available and most 
expect that physicians will not have this updated technology by January 
2017, requiring physicians to use alternatives to meet the ACI 
requirements and limiting those in alternative payment models (APMs) 
from utilizing the benefits of the new technology.

The statutory language for the MIPS and APM categories does not require 
the use of a full calendar reporting period. The MIPS definition simply 
uses the term ``performance period,'' avoiding the word ``year'' to 
allow CMS flexibility. Indeed, CMS recognizes this authority to set a 
shorter reporting period for the CPIA category and proposes a minimum 
90-day reporting period. The APM statutory language also includes 
language noting that the reporting period ``may be less than a year.'' 
\2\ We urge the Committee to encourage CMS to take advantage of this 
flexibility and allow for a shorter initial performance period, in 
addition to a delayed start date.
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    \2\ Merit-based Incentive Payment System (MIPS) and Alternative 
Payment Model (APM) Incentive under the Physician Fee Schedule, and 
Criteria for Physician-focused Payment Models. 81 FR 28382. (May 9, 
2016). At Sec. 1833(z).
---------------------------------------------------------------------------

Composite Performance Score Methodology

ACOG appreciates the Congressional intent of MACRA to, among other 
things, streamline incentive programs, reduce the administrative burden 
on physicians, and ensure that metrics are relevant to each physician's 
patients. We believe a large part of physician acceptance and 
satisfaction with MACRA will be determined by how easily an individual 
doctor can understand and comply with the performance scoring 
methodology.

MACRA is an enormous improvement over previous law in many ways, 
including that it reduces the reporting requirement from three programs 
to one. We very much support this important change in the law, but it 
is important that we remember that many ob-gyns, especially those not 
in large group practices, do not currently participate in the existing 
programs that will make up MIPS. These ob-gyns face a steep learning 
curve, lacking experience in the previous programs.

Successful implementation must ensure a simplified, user-friendly 
system that is transparent and predictable. Instead, CMS's 
implementation proposal, in particular, the proposed calculation 
methodology for the composite performance score, is overly complex and 
lacks transparency. The calculation will be difficult to replicate 
without an intimate knowledge of the minutia of the formula, 
potentially resulting in a lack of trust in the scores that ob-gyns 
receive from CMS.

Ob-gyns and other providers need to know how their performance will be 
measured and assessed prior to the performance period. Instead, we find 
CMS's proposal lacking in detail of how the benchmarks will be scored. 
We are also troubled that the benchmark year 2015 may not have high-
quality data available due to the transition from International 
Classification of Diseases--(ICD) 9 to ICD-10 midway through the 
calendar year. While 2016 data may still reflect that transition and 
may not be of the highest quality, its consistent use of codes makes it 
the preferable approach.

ACOG is encouraging CMS to exercise flexibility where Congress allowed 
it, including when determining scoring thresholds. The proposed rule 
was unclear as to whether CMS intends to use a single numerical 
threshold or a range of scores to determine the MIPS adjustment 
factors. We recommend using a range of scores as opposed to a single 
number that would create arbitrary cutoffs for the physicians that 
cluster around the mean or median performance level. In that case those 
above the performance threshold would still receive a positive 
adjustment factor and those below would receive a negative adjustment 
factor, as outlined in the statute, but the cluster of physicians 
around the mean/median would be held harmless. This represents a more 
accurate way to judge performance and will avoid both subjective 
penalties and incentives for those whose performances are very similar 
to one another.

Simultaneously, we suggest that CMS delay incorporating improvement 
into the composite scoring methodology at this time. MIPS is an 
entirely new reporting program with new measures, new requirements, and 
new categories that will take significant education for physicians and 
other participants to understand. CMS should take advantage of the 
flexibility Congress built into the statute and delay factoring 
improvement into scoring until at least the second year, to ensure a 
successful launch of the program prior to evaluating future 
improvement.

Finally, ACOG has requested that CMS provide individual clinician and 
group feedback for eligible clinicians reporting as part of a group to 
help providers determine whether to continue reporting with the group 
or change to individual reporting. ACOG recommends that CMS aim to 
display feedback and performance measurement information in graphic 
form with additional details displayed elsewhere. In addition, the 
reports should include high-level overall performance information and 
drill down tables with individual patient information. There have been 
ongoing problems with physicians' ability to access their feedback 
reports due to the overly complicated log-in process. ACOG recommends 
that CMS improve the log-in process for accessing reports to ensure it 
is simple and user-friendly. It should also be possible for individual 
physicians within a group practice to access their own reports directly 
rather than through a group. Additionally, ACOG has requested that CMS 
develop a portal so that ob-gyns are able to accurately estimate how 
their current performance will affect their payment adjustment. This 
will allow for ongoing feedback throughout the performance period, not 
just when reports are released to providers.

Medical Home Model and Medicaid Medical Home Model

ACOG has a strong history of support for medical homes, as a way to 
ensure continuity and coordination of care for women from adolescence, 
through the reproductive years and pregnancy, menopause and beyond. Ob-
gyns are trained to provide primary care services to women throughout 
their life course, not just during their reproductive years. Ob-gyns 
play a critical role in providing primary and preventive care to women 
in the United States, and an ob-gyn is often the only provider a woman 
sees on a regular basis.\3\
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    \3\ Undem, T., and Stewart, E. (2014). Perception is everything: 
How women view their OB/GYN providers. Congressional Leadership 
Conference. Mandarin Oriental, Washington, DC. March 2, 2014.

CMS proposes to allow pediatric medicine, but not obstetrics and 
gynecology, to participate in the Medical Home Model and Medicaid 
Medical Home Model demonstrations, an exclusion that makes no sense to 
us since most pediatric providers care for very few Medicare 
beneficiaries. MACRA is silent on which provider types should qualify, 
leaving it up to CMS and physician input. We believe the decision of 
which doctors should be included should be based on qualifications, not 
specialty designation. But certainly if specialties are going to be 
designated, obstetrics and gynecology must be on the approved list. As 
the population ages, there will be a greater need for ob-gyns to care 
for older women, including in a primary care capacity. Many ob-gyn 
generalists are able to meet the other criteria laid out in the Medical 
Home Model definition. It is important that CMS also include ob-gyns in 
multi-payer models to ensure that ob-gyns and the women they care for 
---------------------------------------------------------------------------
are fully included in alignment efforts.

CMS's overly narrow interpretation of primary care is a detriment to 
women's health. To correct this, CMS should add Physician Specialty 
Code ``16 Obstetrics and Gynecology'' to the list of eligible specialty 
types that can participate in both Medical Home Models. Including ob-
gyns would accurately reflect the training received by ob-gyns in 
residency and the care they provide every day. Ob-gyns do not just 
focus on the reproductive system. Rather, they are trained to provide 
primary care services to women throughout their life course. Preventive 
counseling and health education are essential and integral parts of the 
practice of ob-gyns as they advance the individual and community-based 
health of women of all ages.\4\ During the annual well-woman 
examination, ob-gyns provide screening, evaluation, counseling, and 
immunizations, among other services. They provide nutritional and 
exercise counseling; cardiovascular disease screening; diabetes 
screening, diagnosis, and management; risk counseling and discussion of 
psychosocial topics, including mental health issues and substance use 
disorders; and cancer screening, including colon and lung, as well as 
breast, cervical, endometrial, and ovarian.
---------------------------------------------------------------------------
    \4\ American College of Obstetricians and Gynecologists. The scope 
of practice of obstetrics and gynecology. Approved by the Executive 
Board on February 6, 2005.

In the same vein, it is important that CMS add code ``16 Obstetrics and 
Gynecology'' to the eligible list of specialties that can participate 
in a Medicaid Medical Home Model. As the payer for more than half of 
births in the country, Medicaid is integral to the delivery of women's 
health care.\5\ Women of reproductive age, including Medicaid 
beneficiaries, are a unique patient population and many of their 
primary care needs can effectively be met and managed by ob-gyns. 
Dismissing the care delivered to this significant portion of the 
population and foreclosing ob-gyns' opportunity to improve their 
practice infrastructure and invest in care coordination activities is a 
disservice to the millions of women enrolled in Medicaid and is a lost 
opportunity for aligning the health system and realizing potential 
cost-savings to the Medicaid program.
---------------------------------------------------------------------------
    \5\ Markus, A.R., Andres, E., West, K.D., Garro, N., Pellegrini, C. 
(2013). Medicaid covered births, 2008 through 2010, in the context of 
the implementation of health reform. Women's Health Issues. 23(5):e273-
e280.

Advancing Care Information and 2014-edition Certified Electronic Health 
---------------------------------------------------------------------------
Record Technology (CEHRT)

ACOG has long espoused the potential of electronic health records to 
help ob-gyns improve the quality, safety, and efficiency of the care 
they provide patients. Yet the proposed CMS requirement that ob-gyns 
and other providers must report using the 2015 edition of certified 
electronic health record technology (CEHRT) starting in 2018 is just 
not practical. Of course, using the most up-to-date technology is 
ideal. Today, though, no certified software meets the 2015 edition 
criteria, and widespread access to and adoption by all providers of the 
2015 edition is not likely before 2018. Instead, CMS should allow 
physicians to continue to use the 2014 edition technology, or a 
combination of 2014 and 2015 technology, until it confirms that 2015 
edition technology is readily available and cost-effective to 
practices. In the interim, we hope the Committee will encourage vendors 
to incorporate new MIPS measures into their systems to ensure 
physicians can report via those tools.

Thank you again for the opportunity to submit a written statement for 
the record. ACOG looks forward to our continued partnership with the 
Senate Finance Committee to ensure that MACRA is implemented as 
Congress intended. Please do not hesitate to contact me or ACOG's 
Director of Federal Affairs Rachel Tetlow at [email protected] or 202-
863-2534 should you have any questions.

                                 ______
                                 
                  American Hospital Association (AHA)

                          800 10th Street, NW

                       Two CityCenter, Suite 400

                       Washington, DC 20001-4956

                          (202) 638-1100 Phone

                          http://www.aha.org/

On behalf of our nearly 5,000 member hospitals, health systems and 
other health care organizations, and our 43,000 individual members, the 
American Hospital Association (AHA) appreciates the opportunity to 
submit comments on ensuring the successful implementation of the 
physician quality payment program (QPP) mandated by the Medicare Access 
and CHIP Reauthorization Act of 2015 (MACRA).

The implementation of the MACRA's QPP will have a significant impact, 
both on physicians and the hospitals with whom they partner. According 
to the AHA Annual Survey, hospitals employed more than 249,000 
physicians in 2014, and had individual or group contractual 
arrangements with at least 289,000 more physicians--a significant 
portion of the 800,000 clinicians the Centers for Medicare and Medicaid 
Services (CMS) estimates will be impacted by the MACRA. Hospitals that 
employ physicians directly will help defray the cost of the 
implementation of and ongoing compliance with the new physician 
performance reporting requirements under the Merit-based Incentive 
Payment System (MIPS), as well as be at risk for any payment 
adjustments. Moreover, hospitals may participate in advanced 
alternative payment models (APMs) so that the physicians with whom they 
partner can qualify for the bonus payment and exemption from the MIPS 
reporting requirements.

Given its significance to the hospital field, the AHA is carefully 
monitoring the implementation of the QPP. CMS's recent Notice of 
Proposed Rulemaking includes a number of policies we support, including 
a reduction in the number of required quality measures in the MIPS, 
movement towards greater flexibility in meeting meaningful use in the 
advancing care information (ACI) category of the MIPS, and a flexible 
approach to the certified electronic health record (EHR) and quality 
measurement criteria in the APM track. However, we believe significant 
changes must be made to policies that may impinge upon the ability of 
hospitals and physicians to successfully participate in the QPP. 
Specifically, we believe the QPP should include:

      An expanded definition of advanced APMs that recognizes the 
substantial investments that must be made to launch and operate APM 
arrangements;

      A quality and resource use measure reporting option in which 
hospital-based physicians can use CMS hospital quality program measure 
performance in the MIPS;

      A socioeconomic adjustment in the calculation of performance as 
needed; and

      Alignment between the hospital meaningful use program and the 
ACI category of the MIPS, and simplified ACI requirements.

In addition, we urge Congress to consider changes to the fraud and 
abuse laws to allow hospitals and physicians to work together to 
achieve the important goals of new payment models--improving quality, 
outcomes and efficiency in the delivery of patient care.

Detailed information about our suggestions for improvement to the 
implementation of the QPP mandated by MACRA are below.

                      DEFINITION OF ADVANCED APMS

The MACRA provides incentives for physicians who demonstrate 
significant participation in APMs. The AHA supports accelerating the 
development and use of alternative payment and delivery models to 
reward better, more efficient, coordinated and seamless care for 
patients. Many hospitals, health systems and payers are adopting such 
initiatives with the goal of better aligning provider incentives to 
achieve the Triple Aim of improving the patient experience of care 
(including quality and satisfaction), improving the health of 
populations and reducing the per capita cost of health care. These 
initiatives include forming accountable care organizations, bundling 
services and payments for episodes of care, developing new incentives 
to engage physicians in improving quality and efficiency, and testing 
payment alternatives for vulnerable populations.

Despite the progress made to date, the field as a whole is still 
learning how to effectively transform care delivery. There have been a 
limited number of APMs introduced so far, and existing models have not 
provided participation opportunities evenly across physician 
specialties. Therefore, many physicians may be exploring APMs for the 
first time.

As a general principle, the AHA believes the APM provisions of the 
MACRA should be implemented in a broad manner that provides the 
greatest opportunity for physicians who so choose to become qualifying 
APM participants. Particularly in the early years of MACRA 
implementation, the QPP should reflect an expansive approach that 
encourages and rewards physicians who demonstrate movement toward APMs.

For this reason, the AHA is extremely disappointed that few of the 
models in which hospitals have engaged will qualify as advanced APMs as 
defined in CMS's proposed rule. We urge the Administration adopt a more 
inclusive approach. Specifically, we are concerned about CMS's proposed 
generally-applicable financial risk standard, under which an APM must 
require participating entities to accept significant downside risk to 
qualify as an advanced APM. We recommend the expansion of the 
definition of financial risk to include the investment risk borne by 
providers who participate in APMs, and the development of a method to 
capture and quantify such risk. We also urge CMS to update existing 
models, such as the Bundled Payments for Care Initiative and the 
Comprehensive Care for Joint Replacement, so that these models would 
qualify as advanced APMs.

We believe it is fair, as well as important, that the QPP recognize the 
significant resources providers invest in the development of APMs. For 
example, to successfully implement an APM, providers must acquire and 
deploy infrastructure and enhance their knowledge base in areas, such 
as data analytics, care management and care redesign. Further, one 
metric for APM success--meeting financial targets--may require 
providers to reduce utilization of certain high-cost services, such as 
emergency department visits and hospitalizations through earlier 
interventions and supportive services to meet patient needs. However, 
this reduced utilization may result in lower revenues. Providers 
participating in APMs accept the risk that they will invest resources 
to build infrastructure and potentially see reduced revenues from 
decreased utilization, in exchange for the potential reward of 
providing care that better meets the needs of their patients and 
communities and generates shared savings. This risk is the same even in 
those models that do not require the provider to repay Medicare if 
actual spending exceeds projected spending.

Although the clinicians participating in shared savings-only models are 
working hard to support the Administration's goals to transform care 
delivery, under CMS's proposal they will not be recognized for those 
efforts. We believe this would have a chilling effect on 
experimentation with new models of care among providers that are not 
yet prepared to jump into two-sided risk models.

                    RECOMMENDED CHANGES TO THE MIPS

The MACRA sunsets three existing physician quality performance 
programs--the physician quality reporting system, Medicare EHR 
Incentive Program for eligible professionals and the value-based 
payment modifier--and consolidates aspects of those programs into the 
MIPS. The MIPS will be the default QPP track for eligible clinicians. 
The MIPS must assess eligible clinicians on four performance 
categories--quality measures, resource use measures, clinical practice 
improvement activities and ACT, a modified version of the historical 
meaningful use program. Based on their MIPS performance, eligible 
clinicians will receive incentives or penalties under the Medicare 
physician fee schedule of up to 4 percent in calendar year (CY) 2019, 
rising gradually to a maximum of 9 percent in CY 2022 and beyond.

The AHA urges the adoption of a MIPS that measures providers fairly, 
minimizes unnecessary data collection and reporting burden, focuses on 
high-priority quality issues, and promotes collaboration across the 
silos of the health care delivery system. To achieve this, we believe 
the QPP should encompass the following characteristics:

      Streamlines the focus of the MIPS measures to reflect national 
priority areas;

      Allows hospital-based physicians to use their hospital's quality 
reporting and pay-for-performance program measure performance in the 
MIPS;

      Employs risk adjustment rigorously--including sociodemographic 
adjustment, where appropriate--to ensure providers do not perform 
poorly in the MIPS simply because of the types of patients they care 
for; and

      Moves away from an ``all-or-none'' scoring approach for the ACI 
category, and ensure that programmatic changes for eligible clinicians 
are aligned with those of the EHR Incentive Program for eligible 
hospitals.

The AHA agrees with several CMS proposals that are aligned with these 
recommendations, including a reduction in the number of required 
quality measures. However, we urge significant changes to policies 
discussed below to reduce unnecessary burden, address technical 
problems, and maximize the ability of the MIPS to compare performance 
fairly.

Use of Hospital Quality Measures for Hospital-Based Clinicians

The AHA urges adoption of a CMS hospital quality program measure 
reporting option for hospital-based clinicians in the MIPS as soon as 
possible. A provision in the MACRA allows CMS to develop MIPS-
participation options for hospital-based clinicians so they can use 
their hospital's quality and resource use measure performance for the 
MIPS. We believe using hospital measure performance in the MIPS would 
help physicians and hospitals better align quality improvement goals 
and processes across the care continuum, and reduce data collection 
burden.

While we are disappointed that the agency does not formally propose 
such an option for the CY 2019 MIPS, we look forward to working with 
all stakeholders in the coming months to make hospital-based physician 
reporting in the MIPS a reality.

Socioeconomic Adjustment

The AHA strongly urges the robust use of risk adjustment--including 
socioeconomic adjustment, where appropriate--to ensure caring for more 
complex patients does not cause providers to appear to perform poorly 
on measures. It is a known fact that patient outcomes are influenced by 
factors other than the quality of the care provided. In the context of 
quality measurement, risk adjustment is a widely accepted approach to 
account for some of the factors outside the control of providers when 
one is seeking to isolate and compare the quality of care provided by 
various entities. As noted in the National Quality Forum's 2014 report 
on risk adjustment and sociodemographic status, risk adjustment creates 
a ``level playing field'' that allows fairer comparisons of providers. 
Without risk adjustment, provider performance on most outcome measures 
reflect differences in the characteristics of patients being served, 
rather than true differences in the underlying quality of services 
provided.

The evidence continues to mount that sociodemographic factors beyond 
providers' control--such as the availability of primary care, physical 
therapy, easy access to medications and appropriate food, and other 
supportive services--influence performance on outcome measures. For 
example, in January 2016, the National Academy of Medicine (NAM) 
released the first in a planned series of reports that identifies 
``social risk factors'' affecting the health outcomes of Medicare 
beneficiaries and methods to account for these factors in Medicare 
payment programs. Through a comprehensive review of available 
literature, the NAM's expert panel found evidence that a wide variety 
of social risk factors may influence performance on certain health care 
outcome measures, such as readmissions, costs and patient experience of 
care. These community issues are reflected in readily available proxy 
data on socioeconomic status, such as U.S. Census-derived data on 
income and education level, and claims-derived data on the proportion 
of patients dually eligible for Medicare and Medicaid. The agency also 
recently proposed to adjust several measures in the Medicare Advantage 
Star Rating program for sociodemographic factors. Yet, to date, CMS has 
resisted calls to incorporate sociodemographic adjustment into the 
quality measurement programs for physicians, hospitals, and other 
providers.

Unfortunately, failing to adjust measures for sociodemographic factors 
when necessary and appropriate can harm patients and worsen health care 
disparities by diverting resources away from physicians, hospitals and 
other providers treating large proportions of disadvantaged patients. 
It also can mislead patients, payers and policymakers by blinding them 
to important community factors that contribute to poor outcomes. 
Physicians, hospitals and other providers clearly have an important 
role in improving patient outcomes and are working hard to identify and 
implement effective improvement strategies. However, there are other 
factors that contribute to poor outcomes. If quality measures are 
implemented without identifying sociodemographic factors and helping 
all interested stakeholders understand their role in poor outcomes, 
then the nation's ability to improve care and eliminate disparities 
will be diminished.

MIPS Advancing Care Information Category

CMS proposes a new framework for the Medicare EHR Incentive Program for 
MIPS-eligible clinicians. The AHA supports changes to the meaningful 
use program for physicians that begin to offer flexibility in how 
physicians and other eligible clinicians are expected to use certified 
EHRs to support clinical care. As these changes are implemented, it 
will be essential to ensure that program requirements are aligned 
across all participants, including physicians, hospitals, and critical 
access hospitals. This alignment is essential to ensuring the ability 
of providers to share information and improve care coordination across 
the continuum.

CMS proposes two pathways for provider participation in the ACI 
performance category with base requirements and an additional 
performance score. The AHA appreciates the movement toward flexibility 
in the measures, but we remain concerned that the reporting burden will 
remain high. The AHA recommends that CMS simplify the ACI requirements 
by permitting eligible clinicians to use objectives and measures 
derived from the EHR Incentive Program Modified Stage 2. We also 
recommend a delay in the introduction of Stage 3 until a date no sooner 
than CY 2019.

In addition, the AHA supports the elimination of an all-or-nothing 
approach that makes clear that attainment of 70 percent of the 
objectives and measures in meaningful use afford full credit in this 
performance category. Prior experience has demonstrated that the 
complexity of the measures, the length of the reporting period and 
immature standards and technology present challenges to successfully 
meeting program requirements.

The AHA strongly supports the goals of information sharing to improve 
care, engage patients, and support new models of care. The proposed 
rule would require all hospitals, CAHs and physicians that participate 
in the meaningful use program to attest that they did not ``knowingly 
and willfully take action to limit or restrict the compatibility or 
interoperability'' of their certified EHR. Additionally, the proposed 
rule would require two additional attestations:

    (1)  How the technology is implemented to conform with standards, 
allow patient access and support secure and trusted bi-directional 
exchange; and

    (2)  That hospitals, CAHs or physicians responded in good faith and 
in a timely manner to requests to retrieve or exchange electronic 
health information, including from patients, health care providers, and 
other persons, regardless of the requester's affiliation or technology 
vendor.

The AHA is concerned that proposals that physicians attest to not 
participating in information blocking--and cooperate with EHR 
surveillance activities--do not focus on the core issues at hand. The 
AHA recommends that the Administration, including CMS and the Office of 
the National Coordinator for Health IT, consider the extent to which we 
have the standards, technology and infrastructure in place to 
facilitate information exchange with a focus on mechanisms to ensure 
the availability of efficient and effective trusted exchange in 
practice, and robust testing of products used to support exchange. 
Without those building blocks in place, providers are challenged to 
efficiently and effectively exchange and use health information.

The AHA also recommends adoption of only one of the three proposed 
attestations about information blocking--that hospitals and CAHs 
participating in the meaningful use program and clinicians 
participating in the Medicare quality program attest that they have not 
``knowingly and willfully taken action (such as to disable 
functionality) to limit or restrict the compatibility or 
interoperability of their certified EHR.''

                LEGAL IMPEDIMENTS TO IMPLEMENTATION OF 
                           NEW PAYMENT MODELS

By tying a portion of most physicians' Medicare payments to performance 
on specified metrics and encouraging physician participation in APMs, 
the MACRA takes another step in the health care field's movement to a 
value-based paradigm from a volume-based approach. To achieve the 
efficiencies and care improvement goals of the new payment models, 
hospitals, physicians and other health care providers must break out of 
the silos of the past and work as teams. Of increasing importance is 
the ability to align performance objectives and financial incentives 
among providers across the care continuum.

Outdated fraud and abuse laws, however, are standing in the way of 
achieving the goals of the new payment systems, specifically, the 
physician self-referral (Stark) law and Anti-Kickback statute. These 
statutes and their complex regulatory framework are designed to keep 
hospitals and physicians apart--the antithesis of the new value-based 
delivery system models. A recent AHA report, Legal (Fraud and Abuse) 
Barriers to Care Transformation and How to Address Them, examines the 
types of collaborative arrangements between hospital and physicians 
that are being impeded by these laws and recommends specific 
legislative changes.

Congress should create a clear and comprehensive safe harbor under the 
Anti-Kickback Law for arrangements designed to foster collaboration in 
the delivery of health care and incentivize and reward efficiencies and 
improvement in care. Arrangements protected under the safe harbor would 
be protected from financial penalties under the Anti-Kickback civil 
monetary penalty law. In addition, the Stark Law should be reformed to 
focus exclusively on ownership arrangements. Compensation arrangements 
should be subject to oversight solely under the Anti-Kickback Law.

                               CONCLUSION

Thank you for the opportunity to share our views on the implementation 
of the MACRA. The AHA looks forward to working with Congress, CMS and 
all other stakeholders to ensure successful implementation of physician 
payment reforms enhances the ability of hospitals and physicians to 
deliver quality care to patients and communities.

                                 ______
                                 
              American Society of Plastic Surgeons (ASPS)

                            Executive Office

                        444 East Algonquin Road

                    Arlington Heights, IL 60005-4664

                    847-228-9900  Fax: 847-228-9131

                    https://www.plasticsurgery.org/

July 13, 2016

U.S. Senate
Committee on Finance
Dirksen Senate Office Building
Washington, DC 20510

Chairman Hatch, Ranking Member Wyden, and the honorable members of the 
Senate Committee on Finance (Committee), on behalf of the American 
Society of Plastic Surgeons (ASPS), we submit this testimony regarding 
the July 13, 2016 Committee hearing reviewing the Medicare Access and 
CHIP Reauthorization Act of 2015 (MACRA) implementation process. ASPS 
is grateful for your continued attention to the MACRA rulemaking 
process.

ASPS is the largest association of plastic surgeons in the world, 
representing more than 7,000 members and 94 percent of all American 
Board of Plastic Surgery board-certified plastic surgeons in the United 
States. Plastic surgeons provide highly skilled surgical services that 
improve both the functional capacity and quality of life of patients. 
These services include the treatment of congenital deformities, burn 
injuries, traumatic injuries, hand conditions, and cancer. ASPS 
promotes the highest quality patient care, professional and ethical 
standards, and supports education, research and the public service 
activities of plastic surgeons.

As mentioned above, plastic surgeons perform a wide array of procedures 
and surgeries. This diversity makes defining quality care a difficult 
task. As surgical specialists, plastic surgeons have unique issues with 
the MACRA implementation process, and today we address the Committee 
regarding three specific areas where the Centers for Medicare and 
Medicaid Services (CMS) has deviated from Congressional intent:

    1.  SECTION 101(e) of the law creates a new Physician-Focused 
Payment Technical Advisory Committee (PTAC) to provide recommendations 
to the Secretary of Health and Human Services on the development of new 
physician-focused alternative payment models. Late in 2015, CMS staff 
stated in public forums that it is ``under no statutory obligation'' to 
follow the recommendations of the PTAC. This clearly disregards 
Congress's desire to ensure that the design of these models is heavily 
influenced by the practitioners that form their foundation. 
Additionally, ASPS is concerned that the review criteria employed by 
the PTAC will not result in sufficient engagement with specialty 
medicine providers in the evaluation of proposed new specialty-focused 
payment models.

    2.  SECTION 102 of the law directs the Secretary to provide $15 
million annually to support the development of physician quality 
measures, beginning in FY15. FY15 came and went without these funds 
being released, FY16 is nearing its end, and CMS has given no 
indication of when they will be made available. Furthermore, ASPS has 
heard troubling indications that CMS may determine that medical 
specialty societies will not be eligible to apply for this funding. 
Because they play a significant role in the development of evidenced 
based clinical guidelines and provide a great deal of time and 
resources measuring specialty-specific quality, medical specialty 
societies are uniquely positioned to develop quality measures for 
physician specialists. If CMS enacts this provision as suspected, it 
will disadvantage specialist physicians and undermine efforts to 
develop useful measures.

    3.  SECTION 105(b) of the law directs CMS to share Medicare claims 
data with Qualified Clinical Data Registries (QCDR) to support quality 
improvement and patient safety. Earlier this year, CMS stated that it 
intended not to implement this provision. This month, CMS released a 
Final Rule partially implementing this section in a manner that does 
not respect the law as written, and will not permit QCDR's to access 
real-time Medicare claims data.

Thank you very much for this opportunity to address the Committee and 
for your consideration of our comments. CMS should not be allowed to 
repeat the mistakes of the past, and we implore Congress to ensure that 
its statutory will is respected in the design of MACRA. Additionally, 
ASPS is happy to work with you and CMS to ensure CMS implements the law 
appropriately. Please do not hesitate to contact Patrick Hermes, ASPS 
Senior Manager of Advocacy and Government Affairs, if you have any 
comments, questions, or concerns. He can be reached at phermes@
plasticsurgery.org or (847) 228-3331.

                                 ______
                                 
                    The Docs4PatientCare Foundation
The Medicare Access and CHIPS Reauthorization Act of 2015 (MACRA) is 
the largest body of legislation affecting health care since the passage 
of Obamacare in 2009. It is also the most expensive since Obamacare, 
costing billions of dollars per year to implement and maintain. The 
Docs4PatientCare Foundation is pleased to submit the following comments 
regarding MACRA to the Senate Committee on Finance.

Introduction and Overview

To fully understand the nature of the MACRA rule and our comments 
regarding the same, it is necessary to review the historical context in 
which MACRA was passed. MACRA consolidates several existing programs 
including the Meaningful Use health information technology program, the 
Value-Based Purchasing Program and the PQRS quality reporting program. 
In the past these programs existed in separate bodies of legislation/
regulation and thus were never considered together in their entirety 
until now. This brings many previously discussed yet still unresolved 
issues regarding health care delivery to the surface for conversation 
and review.

This legislation brings back into the spotlight many issues regarding 
the four major components of the proposed rule. The first issue is the 
role of third party quality measurement in the practice of medicine. 
The ``quality movement'' in medicine has been in existence for at least 
10 years since the first version of the Physician Quality Reporting 
System (PQRS) was issued in 2006. Since then the ``quality movement'' 
has enjoyed increasing momentum based on little more than its own 
propaganda. The biggest single body of information regarding the 
alleged lack of quality in U.S. health care is based on a study issued 
by the World Health Organization in 2000, the World Health Report 2000. 
This has led to other misguided reports from similarly inclined 
institutions that compare infant mortality rates and life expectancies 
across a large number of countries including the United States. When 
compared against per capita health-care spending it becomes clear that, 
although the United States spends the most per capita on health care 
(currently about $8,750 per individual), the ranking of the United 
States regarding life expectancy and infant mortality are generally in 
the mid-30s and are even lower among industrialized nations. These data 
are routinely used to construct an intellectual ``shell game'' based on 
the assumption that infant mortality and life expectancy are valid 
measures of a health-care system's performance. The misguided 
conclusion is that the United States is not getting its money's worth 
from its health-care system.

A significant body of information demonstrates that these assumptions 
regarding the relationship of infant mortality and life expectancy to 
overall health-care system performance are untrue. Japan, for example, 
is usually touted as the nation with the highest life expectancy while 
spending less than half the amount per capita for health care as does 
the United States. If life expectancy were truly a measure of health-
care system performance then one would expect people of Japanese 
ancestry who live in the United States to have a lower life expectancy 
because they are ``victims'' of a poor health-care system. In fact the 
opposite is true: people of Japanese ancestry have the same life 
expectancy whether they live in the United States or Japan. A truly 
objective analysis of the data clearly demonstrates that there is no 
statistical relationship between life expectancy and per capita 
spending on health care. Life expectancy has instead been shown to be 
associated with factors independent of the health-care system--such as 
cleanliness of living conditions, income, literacy rate, diet, 
lifestyle and genetics.

Using infant mortality as a measure of overall health-care system 
performance suffers from different yet equally significant 
shortcomings. The methods of measuring infant mortality differ greatly 
among countries. The United Nations Statistics Division defines a live 
birth as an infant, once removed from its mother, which is breathing or 
shows other evidence of life such as a heartbeat, pulsation of the 
umbilical cord or movement of voluntary muscles regardless of 
gestational age. However, Switzerland's definition also stipulates the 
infant must be at least 30 cm long at birth to be considered living. 
Italy has three different definitions of infant death depending on 
region within the nation. Japan, Finland, France and Norway all have 
different approaches to counting births from citizens living outside 
the host nation. In addition, infant mortality also is affected by 
parental behavior including marital status. No health-care system has 
any control over issues such as these.

Perhaps most telling is that the Editor-in-Chief of the original World 
Health Report 2000, Philip Musgrove, Ph.D., opined in the New England 
Journal of Medicine in 2010 that the data from the report were being 
used improperly for the purpose of ranking health-care systems and that 
``it is long past time for the zombie number(s) to disappear from 
circulation.''

Why do supporters of big government-based health-care reform continue 
to cite these numbers as evidence that America is not getting value 
regarding health-care spending? Here's where the intellectual shell 
game occurs. The rhetoric regarding ``not getting one's money's worth'' 
is used to shift the health-care reform conversation from a paradigm of 
cost and access to one of quality and value. This serves two purposes 
for those who endeavor to control the narrative on health-care reform. 
First, the shift from a cost/access argument to one involving quality/
value moves the conversation from easily measurable elements (cost and 
access) to elements which are impossible to measure (quality and 
value). Indeed quality and value do not even possess objective units of 
measurement. Thus, any health-care reform measures implemented in the 
name of quality and value cannot be proven to fail based on objective 
measurement. In such an intellectual vacuum a perception of success can 
be created by an effective narrative. There is no need whatsoever for 
the measures in question to actually succeed.

The second purpose is equally sinister. A conversation based on cost 
and access will by its nature distribute responsibility for rising 
health-care costs appropriately across all competitive stakeholders 
within the health-care system. It is intuitively obvious that in a 
cost-based conversation, blame is shared among insurance plans, 
government regulations, hospitals/health systems, and physicians 
themselves. Conversely, a value/quality conversation allows the 
predominance of blame to be placed upon physicians and others who touch 
patients for a living.

Into such a ``fertile'' environment the proposed MACRA rule has been 
introduced. A conversation based on quality/value makes a 962 page rule 
which proposes over 450 quality measures appear reasonable. And no 
matter what the outcome, its supporters will claim success and support 
that claim with well constructed rhetoric. But once the quality/value 
vs cost/access shell game has been recognized, the proposed rule looks 
quite different. It has been estimated that the cost of reporting 
quality measures alone is over $15 billion per year. Since quality 
reporting is one of four major components to the proposed rule one can 
roughly estimate the total cost of the proposed rule to be at least $60 
billion per year. Thus when the proposed rule is evaluated in the 
appropriate cost/access paradigm, MACRA must save $60 billion per year 
before the first penny of benefit is realized. In this framework the 
proposed MACRA rule quickly collapses under its own weight.

Comments Regarding Specific Parts of the Rule

1. Quality reporting. ``Eligible clinicians'' must report on six 
quality measures chosen from a list of 465 options. These must include 
at least one ``cost-cutting measure'' and one ``outcomes measure.'' 
Supporters of the proposed rule point out that this is fewer than the 
nine quality measures that were originally required under the 
Meaningful Use guidelines. However, it is widely recognized that, with 
rare exceptions, such quality measures have never been shown to improve 
outcomes. Under the Meaningful Use program such quality measures have 
generated huge amounts of data reported to CMS that have never been 
read or analyzed. Continuing such a practice ensures that the $15 
billion a year that is currently spent on quality reporting will 
continue to be wasted.

Respected leaders within the health IT and government communities have 
criticized quality measures. Former CMS Administrator Donald Berwick in 
December 2015 proposed nine steps to enter the ``moral era'' of health 
care. These included stopping excessive measurement and abandoning 
complex incentives. He proposed a 50% reduction in number of the 
quality metrics reported. This would support a reduction from nine 
quality measures--beyond the proposed six--down to four. John Halamka, 
Chief Information Officer at Beth Israel Deaconess Medical Center and 
one of America's leading health information technology experts, has 
recommended replacing all EMR and quality reporting requirements with 3 
outcome-based measures chosen by each medical specialty. We would 
therefore suggest that the number of quality measures required be 
reduced further from 6 to 3.

2. Advancing care information. This is the section of the proposed rule 
which carries most of the requirements previously included in the 
Meaningful Use program. There is, however, one important addition to 
the proposed health IT/EHR requirements which is based on potentially 
deliberate misuse of supporting information and which carries very 
frightening implications. This section requires that the eligible 
clinician complete a three-part attestation that (1) one did not take 
action to knowingly restrict compatibility or interoperability, that 
(2) implemented technologies and electronic medical record systems are 
configured in a compliant manner, and that (3) one responded in good 
faith and in a timely fashion to medical information requests. This is 
part of the commitment of CMS to enhance interoperability and suppress 
``data blocking.'' On pages 41 and 42 of the proposed rule, the 
requirement for clinicians to make such attestations is supported by 
evidence that ``health-care providers'' have engaged in data blocking. 
The source of this evidence is a report to Congress entitled Report on 
Health Information Blocking delivered to Congress in April 2015 by the 
Office of the National Coordinator of Health Information Technology. A 
careful review of that report reveals on pages 15-18 a discussion of 
anecdotal evidence of ``potential information blocking.'' However, in 
this discussion the term ``providers'' refers to large hospitals and 
health-care systems, not the individual physicians to whom the 
attestation requirements of the proposed rule are directed. The 
deception here is clear; whether such a deception was borne of 
``advantageous negligence'' or malevolence is academic.

Individual physicians have absolutely no vested interest in ``blocking 
data'' or any other behavior which impairs the exchange of health 
information between any entities that are legally or morally entitled 
to such information. The notion that physicians need to complete 
attestations that they do not engage in such behavior is both punitive 
and useless. It also initiates a ``slippery slope'' of progressively 
ratcheted attestations over time to develop a quasi-legally binding 
culture of ``allegiance'' to CMS. This is morally and ethically 
bankrupt. The attestation requirement of the Advancing Care Information 
section must be removed.

With few exceptions (mostly cardiology and surgery), none of the 465 
options for reporting measures in the proposed rule are based on 
scientific method. We propose that each of the 465 options must meet 
three criteria. First, it must be based on scientific method. Second, 
there must be a plan to review and act on the data that is reported to 
CMS through the guideline. Third, the reporting of such quality 
measures must be an automated function of the electronic medical record 
system and not impair, slow down or distract physicians participating 
directly in patient care.

3. Calculation of performance scores. For each eligible clinician 
Medicare payments will be adjusted upward (bonus) or adjusted downward 
(penalty) based on a performance score. The score has four components: 
Advancing Care Information, quality measures, resource use, and 
clinical practiceimprovement. When fully implemented payments may be 
adjusted upward or downward by as much as 9% based on the performance 
score. Although CMS portrays this payment method as an improvement over 
the current ``all or nothing'' incentive/penalty system currently in 
use, further analysis reveals this proposed method to be worse than the 
current method. The problem lies in the requirement that the program is 
revenue neutral. There must be enough penalties assessed to fund the 
bonuses. This means there will never be a state in which all eligible 
clinicians achieve an acceptable level of compliance to avoid a 
penalty. Simply, performance scores must be ``graded on the curve'' to 
meet the revenue neutral requirements. This is unacceptable. All 
physicians should have the opportunity to comply with the program at an 
adequate level to avoid penalty.

Within the proposed rule the now infamous Table 64 offers chilling 
statistics for physicians in small practices (defined as less than 100 
physicians). For practices of nine clinicians or less the odds are 
approximately 85% that they will receive a penalty rather than a bonus. 
Only for practices of 100 or more eligible clinicians do the odds of a 
bonus exceed the odds of a penalty. Although CMS is quick to point out 
that this is based on 2014 data and that smaller practices have 
significantly better reporting in subsequent years, the revenue-neutral 
nature of this portion of the program still mandates that performance 
thresholds be raised every year to ensure that there are enough losers 
to finance the winners. Small practices have no chance of competing 
against the far greater aggregate resources of the 100+ clinician 
practices. We therefore propose that the revenue-neutral nature of this 
portion of the program be eliminated and that penalty-performance 
threshold scores be fixed for a number of years to give practices with 
less than 100 clinicians enough incentive to improve compliance and 
avoid penalties.

4. Obligations of eligible clinicians regarding documentation of usage 
of certified EMR technology. After 6 years of Meaningful Use 
implementation it is not possible for any eligible clinician to meet 
all of the requirements under MACRA without having a certified EMR 
system. Thus the notion that every eligible clinician must go through 
an elaborate series of steps through the CMS website to obtain a 
certification number for the EMR system is no longer valid. We propose 
that the documentation requirements regarding use of certified EMR 
technology be eliminated for providers and that all activity regarding 
EMR certification take place only between CMS and the EMR vendors. It 
should suffice that the eligible clinician provides only a short 
statement from the EMR vendor documenting that an EMR is in use and 
that licensing fees are current.

5. Expansion of EMR surveillance by ONC under MACRA. Beginning on page 
40 of the proposed rule CMS makes the argument that the Office of the 
National Coordinator has been authorized by the Office of Civil Rights 
to act as a ``health oversight agency'' under HIPAA to conduct ongoing 
surveillance of any and all EMR systems in use by eligible clinicians 
including access to patients' protected health information in the name 
of quality monitoring. This has been widely and sternly criticized by 
physicians as a violation of our obligations under the Hippocratic Oath 
to patient privacy and is a violation of the Fourth Amendment of the 
U.S. Constitution. Furthermore, CMS offers no examples of past 
incidents of quality issues which would have been improved or events 
prevented by such surveillance. We therefore side with the opinions of 
a great number of concerned physicians that there is no ethical or 
quality driven justification for such practices. We therefore propose 
that this expansion of EMR surveillance by ONC be eliminated.

6. Alternative Payment Models (APMs). A detailed commentary regarding 
Alternative Payment Models is beyond the scope of this document. 
However, it is interesting to note an article in the current issue of 
the New England Journal of Medicine (June 16, 2016) entitled ``Early 
Performance of Accountable Care Organizations and Medicare.'' The 
article concludes that contracts with ACOs under the Medicare Shared 
Savings Program showed reductions in Medicare savings that were either 
trivial ($144 per beneficiary) or statistically insignificant ($3 per 
beneficiary)

Conclusions

Although the Docs4PatientCare Foundation is pleased to submit these 
comments regarding the proposed MACRA rule, our participation in the 
commentary process should not be interpreted to mean that we support 
the existence of MACRA or the spirit of this law. MACRA was passed last 
year with bipartisan support; however, this bipartisan support came 
only because of the widespread need to eliminate the SGR model of 
calculating Medicare payments to physicians. Congress and organized 
medicine were so focused on this issue that the remainder of MACRA, 
including the Merit Incentive Payment System and Alternative Payment 
Models, was largely ignored during its passage. The notion that quality 
can be measured by a third-party long after a health-care transaction 
event is deeply flawed and has never been demonstrated to be effective 
in improving patient care outcomes. The idea that such flawed quality 
measurements should be used to financially punish physicians is 
extremely unethical. At the legislative level we support delaying the 
implementation of MACRA from 2017 to 2019 to allow further time for 
study and enough time for physician practices to prepare after the 
final MACRA rule is issued. We also support legislation that would 
eliminate future Medicare penalties to physicians based on reporting 
behavior in 2016, similar to the Patient Access and Medicare Protection 
Act of 2015.

It is appropriate to conclude with two insightful quotes from John 
Halamka:

        When you remodel a house, there comes a point when additional 
        improvements are not possible and you need to start again with 
        a new structure.

And finally,

        It's time to leave the profession if we stay on the current 
        trajectory.

References:

Marty Stempniak, Don Berwick Offers Health Care 9 Steps to End Era of 
``Complex Incentives'' and ``Excessive Measurement,'' http://
www.hhnmag.com/articles/6798-don-berwick-offers-health-care-9-steps-to-
end-this-era-of-greed-and-excessive-measurement, December 11, 2015.

``Health Care System Rankings,'' N. Engl. J. Med., 2010, 362:1546-1547, 
April 22, 2010, DOI: 10.1056/NEJMc1001849.

Early Performance of Accountable Care Organizations in Medicare, J. 
Michael McWilliams, M.D., Ph.D., Laura A. Hatfield, Ph.D., Michael E. 
Chernew, Ph.D., Bruce E. Landon, M.D., M.B.A., and Aaron L. Schwartz, 
Ph.D., N. Engl. J. Med., 2016, 374:2357-2366, June 16, 2016, DOI: 
10.1056/NEJMsa1600142.

David Hogberg, Ph.D., Don't Fall Prey to Propaganda: Life Expectancy 
and Infant Mortality are Unreliable Measures for Comparing the U.S. 
Health Care System to Others, http://www.nationalcenter.org/
NPA547ComparativeHealth.html July 2006.

John Halamka, A Deep Dive on the MACRA NPRM, May 5, 2016, http://
thehealthcareblog.com/blog/2016/05/05/a-deep-dive-on-the-macra-nprm/.

John Halamka, Rethinking MACRA Part II, May 15, 2016, http://
thehealthcareblog.com/blog/2016/05/15/rethinking-macra-part-ii/.

Philip Musgrove, editor et al., The World Health Report 2000, The World 
Health Organization, http://www.who.int/whr/2000/en/whr00_en.pdf?ua=1.

                                 ______
                                 
             Infectious Diseases Society of America (IDSA)

                    1300 Wilson Boulevard, Suite 300

                          Arlington, VA 22209

                          TEL: (703) 299-0200

                          FAX: (703) 299-0204

                   E-mail address: [email protected]

                   Website: http://www.idsociety.org/

The Honorable Orrin Hatch           The Honorable Ron Wyden
Chairman                            Ranking Member
Committee on Finance                Committee on Finance
U.S. Senate                         U.S. Senate
104 Hart Senate Office Building     221 Dirksen Senate Office Building
Washington, DC 20510                Washington, DC 20510

Dear Chairman Hatch and Ranking Member Wyden:

Thank you for scheduling the hearing entitled, ``Medicare Access and 
CHIP Reauthorization Act (MACRA) of 2015: Ensuring Successful 
Implementation of Physician Payment Reforms'' on Wednesday, July 13, 
2016. IDSA greatly appreciates the Committee's leadership in repealing 
the Medicare Sustainable Growth Rate (SGR) formula and in overseeing 
MACRA implementation. IDSA continues to provide input to the Centers 
for Medicare and Medicaid Services (CMS) on key implementation issues 
and to work with our members to prepare for payment reforms.

We are pleased to share with the Committee some of our recommendations 
for MACRA implementation and hope you will raise some of these issues 
with CMS Administrator Slavitt during the upcoming hearing. We provided 
detailed comments to CMS and below highlight some specific issues that 
we believe will be of interest to the Committee--such as the need for 
new infectious diseases (ID) quality measures and ways to better align 
new physician quality improvement programs with antibiotic stewardship 
and public health emergency preparedness. Given the Committee's 
interest in physician reimbursement issues, we also want to highlight a 
related concern regarding the current undervaluation of the infectious 
diseases (ID) specialty, which is leading to a steep decline in the 
number of physicians pursuing ID specialization, at a time when our 
nation urgently needs ID physician expertise.

The Value of ID Physicians

ID physicians make significant contributions to patient care, 
biomedical research, and public health. Their leadership and services 
save lives, prevent costly and debilitating diseases, and drive 
biomedical innovation. ID physician involvement in patient care is 
associated with significantly lower rates of mortality and 30-day 
readmission rates in hospitalized patients, shorter lengths of hospital 
stay, fewer intensive care unit (ICU) days, and lower Medicare charges 
and payments. Some of the specific important contributions of ID 
physicians include:

      Providing life-saving care to patients with serious infections 
(such as HIV, sepsis, infections caused by antibiotic resistant 
bacteria, Clostridium difficile, and hepatitis C);

      Leading public health activities to prevent, control, and 
respond to outbreaks in healthcare settings and the community, and 
emerging infections such as Ebola and Zika virus infections;

      Leading antibiotic stewardship programs to optimize the use of 
antibiotics to achieve the best clinical outcomes while minimizing 
adverse events, limiting the development of antibiotic resistance and 
reducing costs associated with suboptimal antibiotic use;

      Monitoring and managing highly complex patients with or at risk 
of serious infections (including organ and bone marrow transplant 
patients, chemotherapy patients, and others); and

      Conducting research leading to breakthroughs in the origin and 
transmission of emerging and re-emerging diseases, factors that make 
these virulent, and the development of urgently needed new 
antimicrobial drugs and other therapies, diagnostics, and vaccines.

MACRA Implementation: Opportunities and Challenges

IDSA is excited for the opportunities that MACRA implementation 
presents to realign physician payment to truly incentivize high quality 
care. We are hopeful that the new Quality Payment Program (QPP), which 
incorporates both the Merit-Based Incentive Payment System (MIPS) and 
Alternative Payment Model (APM) options, will offer significant 
improvements over the existing quality programs that it will replace. 
However, we are concerned that the APM option, which offers significant 
incentives, will not be accessible to physicians in small or mid-sized 
practices; and that the MIPS program, as currently structured, misses 
many opportunities to provide quality-based incentives.

The implementation of the new QPP will have a profound impact on ID 
physicians. CMS estimates that approximately 5,544 ID physicians will 
be participating in the MIPS program. Approximately 43% (2,300) of 
those physicians will experience a negative payment adjustment, 
equaling a $12 million loss in Medicare allowed charges across the 
specialty. Given this projection, IDSA has offered CMS a series of 
recommendations to strengthen the MIPS program geared toward providing 
the highest quality ID physician services.
Additional ID Quality Measures
Current Physician Quality Reporting System (PQRS) measures are not 
well-aligned with infectious disease practices. This is due in part to 
the overwhelming proportion of ID clinical services being delivered in 
the inpatient setting while most of the PQRS measures developed apply 
to face-to-face encounters in the outpatient setting. Aside from HIV, 
HCV, pneumonia vaccination and influenza immunization, there are no 
truly ID-specific measures on which ID specialists can report.

IDSA continues to propose relevant and meaningful ID measures for CMS 
to consider within the QPP. Earlier this year, we submitted two 
additional measure concepts (Appropriate Use of anti-MRSA Antibiotics 
and 72-hour Review of Antibiotic Therapy for Sepsis) into the CMS 
Measures Under Consideration (MUC) process, both related to advancing 
quality measurement of antimicrobial stewardship at the physician-
level. We hope the Committee will encourage CMS to advance these into 
inclusion on the list of applicable measures under the quality 
component of MIPS. Antibiotic stewardship is critical to prevent the 
misuse and overuse of antibiotics that drive the development of 
antibiotic resistance--a serious and growing public health crisis that 
claims at least 23,000 lives in the U.S. a year according to the 
Centers for Disease Control and Prevention (CDC) and complicates a host 
of other medical services that rely upon safe and effective 
antibiotics, including the care of preterm infants and 
immunocompromised patients, solid organ and bone marrow transplants, 
cancer chemotherapy, and many surgeries.

IDSA is also pleased that MACRA provides CMS with additional funding 
for measure development. We believe the lack of relevant ID measures 
within the MIPS is partly due to the time and cost of measure 
development, and the additional funding from the MACRA offers an 
invaluable opportunity for CMS to assist in the development of measures 
where gaps exist. We urge the Committee to encourage CMS to use part of 
this funding towards the development of ID measures.
Clinical Practice Improvement Activities (CPIAs) Under MIPS
It is within this component of the MIPS where we believe ID physicians 
will have the most impact and will be able to participate in a 
meaningful way within the QPP. However, we offer several 
recommendations to help ensure that the robust array of appropriate ID 
activities is reflected in the available CPIAs.

IDSA is pleased that CMS is proposing the implementation of an 
antibiotic stewardship program (ASP) as a CPIA, and we recommend that 
CMS strengthen this approach by establishing leadership of an ASP as a 
high weight CPIA while maintaining participation in an ASP as a medium 
weight CPIA. The CDC has recommended that all ASP have a single leader 
who will be responsible for the program's outcomes and have noted that 
physicians--particularly those with formal training in infectious 
diseases--have been highly effective in this role. Further, the Joint 
Commission's Prepublication Standards for Antimicrobial Stewardship 
specifically cites the involvement of an infectious diseases physician 
in ASPs. CMS has issued two proposed rules to require ASPs in acute 
care hospitals and long term care facilities, aligned with the goals 
and objectives of the National Action Plan for Combating Antibiotic 
Resistant Bacteria (CARB). The growing need for stewardship activities 
and expert leaders to ensure their success underscores the importance 
of making leadership of ASP a high weight CPIA.

IDSA is also pleased that CMS has included some emergency preparedness 
and response activities in the CPIA list. However, we strongly believe 
preparedness should go beyond volunteering for domestic and 
international humanitarian work and emergency response and disaster 
assistance. It is critical that our hospitals and health systems 
prepare and build the capacity to respond to public health emergencies, 
including outbreaks such as Ebola Virus Disease, Zika, MERS-CoV, 
pandemic influenza and others. ID physicians are heavily involved in 
these intensive efforts, which often involve coordination across 
multiple departments in a hospital or health system and with public 
health entities, needs assessments, development of protocols, 
communications plans and other activities. IDSA recommends that CMS add 
additional CPIAs to encompass leadership and participation in a wide 
array of health care facility preparedness and response activities.

CMS has appropriately recognized the need to develop and include 
additional CPIAs, allowing for greater participation in MIPS. IDSA has 
recommended that CMS consider the following CPIA concepts: development, 
implementation, and oversight of infection prevention and control 
programs; development, implementation and oversight of infectious 
diseases protocols for solid organ and stem cell transplant procedures; 
implementation and ongoing leadership of a hospital avoidance and 
timely discharge program enabled through outpatient parenteral 
antibiotic therapy; leadership of activities related to hospital or 
health system engagement with local, state or federal public health 
entities (such as surveillance, immunization programs, or outbreak 
response).

Undervaluing ID: Jeopardizing the Next Generation of ID Physicians

It is important for policymakers to understand that MACRA 
implementation is occurring against a complex backdrop for physicians 
and our healthcare system in which compensation issues are driving 
young physicians away from the field of infectious diseases. Data from 
the National Residency Match Program (NRMP) indicate a disturbing 
decline in the number of individuals applying for ID fellowship 
training, with 342 applicants in the 2010-2011 academic year and only 
221 in 2016-2017. For 2016-2017, only 65% (or 218 out of 335) of 
available ID fellowship positions filled. In many specialty areas, all, 
or nearly all, available fellowship positions are typically filled. 
These data indicate a broader problem--the undervaluation of ID.

In 2014, IDSA surveyed nearly 600 Internal Medicine residents about 
their career choices. Very few residents self-identified as planning to 
go into ID. A far higher number reported that they were interested in 
ID but chose another field instead. Among that group, salary was the 
most often cited reason for not choosing ID. Average salaries for ID 
physicians are significantly lower than those for most other 
specialties and only slightly higher than the average salary of general 
Internal Medicine physicians, even though ID training and certification 
requires an additional 2-3 years. Young physicians' significant debt 
burden ($200,000 average for the class of 2014) is understandably 
driving many individuals toward more lucrative specialties.

Over 90% of the care provided by ID physicians is accounted for by 
evaluation and management (E&M) services. These face-to-face, cognitive 
encounters are undervalued by the current payment systems compared to 
procedural practices (e.g., surgery, cardiology, and gastroenterology). 
This accounts for the significant compensation disparity between ID 
physicians and specialists who provide more procedure-based care, as 
well as primary care physicians who provide similar E&M services but 
who have received payment increases simply because of their specialty 
enrollment designations as ``primary care physicians.'' Cognitive E&M 
services comprise a higher percentage of services provided by ID 
specialists than those provided by primary practice specialists such as 
Internal Medicine, Family Medicine or Pediatrics, based on CMS data.

Current E&M codes fail to reflect the increasing complexity of E&M 
work, which covers the vast majority of ID as discussed above. Without 
updated, accurate E&M codes, the payment reform activities included in 
MACRA will have only a limited impact on improving ID patient care and 
will fail to address the underlying problem of undervaluing ID that is 
driving fewer young physicians to enter the specialty. ID physicians 
often care for more chronic illnesses, including HIV, hepatitis C, and 
recurrent infections. Such care involves preventing complications and 
exploring complicated diagnostic and therapeutic pathways. ID 
physicians also conduct significant post-visit work, such as care 
coordination, patient counseling and other necessary follow up.

IDSA urges the Committee to direct CMS to undertake the research needed 
to better identify and quantify the inputs that accurately capture the 
elements of complex medical decision making. Such studies should take 
into account the evolving health care delivery models with growing 
reliance on team-based care, and should consider patient risk-
adjustment as a component to determining complexity. Research 
activities should include the direct involvement of physicians who 
primarily provide cognitive care. Specifically, this research should:

(1)  Describe in detail the full range of intensity for E&M services, 
placing a premium on the assessment of data and resulting medical 
decision making;
(2)  Define discrete levels of service intensity based on observational 
and electronically stored data combined with expert opinion;
(3)  Develop documentation expectations for each service level;
(4)  Provide efficient and meaningful guidance for documentation and 
auditing; and
(5)  Ensure accurate relative valuation as part of the Physician Fee 
Schedule.

Once again, we thank the Committee for its attention to physician 
payment and health care quality, and we look forward to continuing to 
work with you in order to meet the evolving needs of our patients.

Sincerely,

Johan S. Bakken, M.D., Ph.D., FIDSA
President, IDSA

                                 ______
                                 
              Medical Group Management Association (MGMA)

                    1717 Pennsylvania Ave., NW, #600

                          Washington, DC 20006

                             T 202-293-3450

                             F 202-293-2787

                          http://www.mgma.org/

The Medical Group Management Association (MGMA) applauds the U.S. 
Senate Committee on Finance (Committee) for continuing to show 
leadership on the implementation of the Medicare Access and CHIP 
Reauthorization Act of 2015 (MACRA) and is committed to working with 
the Committee, Congress, and the Administration to ensure a successful 
implementation of MACRA.

MGMA helps create successful medical practices that deliver the 
highest-quality patient care. As the leading association for medical 
practice administrators and executives since 1926, MGMA helps improve 
members' practices and produces some of the most credible and robust 
medical practice economic data and data solutions in the industry. 
Through its national membership and 50 state affiliates, MGMA 
represents more than 33,000 medical practice administrators and 
executives in practices of all sizes, types, structures and specialties 
in which more than 280,000 physicians practice.

MGMA strongly supported MACRA, which was a significant legislative and 
policy achievement that replaced the failed sustainable growth rate 
formula with stable Medicare physician payment updates and incentives 
to innovate and participate in new care delivery models that have the 
potential to reduced Medicare waste while improving patient outcomes. 
However, we are concerned that CMS' notice of proposed rulemaking 
(NPRM) implementing the new Merit-Based Incentive Payment System (MIPS) 
and alternative payment models (APMs) strays from the key terms and 
themes of MACRA to simplify quality reporting and reward the move from 
fee-for-service to value-based payment and delivery models. Instead, 
the NPRM would create a complex web of administratively burdensome 
reporting requirements in MIPS while limiting opportunities for 
practices to utilize the transitional APM payments to support their 
care delivery redesign.

MGMA is pleased to have the opportunity to offer this statement for the 
record at this critical juncture in MACRA implementation and to share 
with the Committee our concerns and recommendations for improving the 
proposed framework for MIPS and APMs. In our comment letter to CMS in 
response to the NPRM, we made recommendations to assist CMS and the 
Administration in implementing MACRA in a manner that supports 
physician group practices as they transform their payment and delivery 
approaches from fee-for-service toward value-based models. Our key 
recommendations include:

      Beginning the first MIPS and APM performance period no sooner 
than January 1, 2018. Beginning January 1, 2018 would bring the 
measurement period closer to the payment year and provide practices 
with more opportunities to participate in eligible APMs by giving more 
time to CMS's Centers for Innovation to develop Medicare payment models 
and the Physician-Focused Payment Models Technical Advisory Committee 
to shepherd private sector models into the eligible APM track.

      Shortening the quality and advancing care information (ACI) 
performance periods to any 90 consecutive days using sampling and 
attestation methodologies that ensure statistical validity. 
Accommodating claims-based reporting with a longer submission period, 
such as 6 months. Ninety days would align quality and ACI with the 
proposed 90-day CPIA performance period.

      Finalizing the MIPS group practice assessment option, which 
recognizes the fundamental advantage the group practice model offers by 
coordinating a wide range of physician and related ancillary services 
in a manner that is seamless to patients.

      Reducing the reporting requirements across MIPS. As proposed, 
physician group practices' finite resources would be spread across at 
least 20 measures and objectives, including a minimum of eight measures 
in the quality category, two measures in resource use, nine measures in 
ACI, and at least one measure in the CPIA category. CMS should 
structure MIPS to allow practices to prioritize effective and impactful 
improvements to patient care, rather than comply with sprawling 
reporting mandates.

      Awarding credit across MIPS performance categories. Whenever 
possible, CMS should award credit in multiple categories to streamline 
the program and reduce redundancies.

      Overhauling the eligible APM criteria and expanding the list of 
qualifying APMs to include legitimate CMS Innovation Center models such 
as Medicare Shared Savings Program (MSSP) Track 1 ACOs and the Bundled 
Payment for Care Improvement (BPCI) models.

      Seeking opportunities to adopt private sector payment models and 
patient-centered medical home (PCMH) models as eligible APMs.

Conclusion

We appreciate the opportunity to submit this statement for the record 
to the Committee. MGMA remains committed to helping group practices and 
CMS understand the best way to implement MACRA in order to streamline 
and harmonize quality reporting programs into MIPS and develop 
meaningful APMs. We look forward to continuing to work with the 
Committee, Congress and the Administration to ensure that the rollout 
of these new programs is successful. We would be happy to provide you 
with a full copy of our comments to CMS's MIPS and APMs NPRM as well as 
any additional resources (www.mgma.org/MACRA).


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