    [Senate Hearing 116-386]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 116-386

                       MEDICARE PHYSICIAN PAYMENT REFORM
                        AFTER TWO YEARS: EXAMINING MACRA
                       IMPLEMENTATION AND THE ROAD AHEAD

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

                                    HEARING

                                   BEFORE THE

                              COMMITTEE ON FINANCE
                              UNITED STATES SENATE

                         ONE HUNDRED SIXTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                  MAY 8, 2019

                                   __________

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                Printed for the use of the Committee on Finance

                                   __________

                        U.S. GOVERNMENT PUBLISHING OFFICE
    42-739 PDF                  WASHINGTON : 2021

    --------------------------------------------------------------------------------------

                              COMMITTEE ON FINANCE

                         CHUCK GRASSLEY, Iowa, Chairman

    MIKE CRAPO, Idaho                    RON WYDEN, Oregon
    PAT ROBERTS, Kansas                  DEBBIE STABENOW, Michigan
    MICHAEL B. ENZI, Wyoming             MARIA CANTWELL, Washington
    JOHN CORNYN, Texas                   ROBERT MENENDEZ, New Jersey
    JOHN THUNE, South Dakota             THOMAS R. CARPER, Delaware
    RICHARD BURR, North Carolina         BENJAMIN L. CARDIN, Maryland
    JOHNNY ISAKSON, Georgia              SHERROD BROWN, Ohio
    ROB PORTMAN, Ohio                    MICHAEL F. BENNET, Colorado
    PATRICK J. TOOMEY, Pennsylvania      ROBERT P. CASEY, Jr., Pennsylvania
    TIM SCOTT, South Carolina            MARK R. WARNER, Virginia
    BILL CASSIDY, Louisiana              SHELDON WHITEHOUSE, Rhode Island
    JAMES LANKFORD, Oklahoma             MAGGIE HASSAN, New Hampshire
    STEVE DAINES, Montana                CATHERINE CORTEZ MASTO, Nevada
    TODD YOUNG, Indiana

                 Kolan Davis, Staff Director and Chief Counsel

                  Joshua Sheinkman, Democratic Staff Director

                                      (ii)

                                C O N T E N T S

                                  ----------

                               OPENING STATEMENTS

                                                                       Page
    Grassley, Hon. Chuck, a U.S. Senator from Iowa, chairman,
      Committee on Finance...........................................     1
    Wyden, Hon. Ron, a U.S. Senator from Oregon......................     3

                                   WITNESSES

    McAneny, Barbara L., M.D., president, American Medical
      Association, Chicago, IL.......................................     5
    Cullen, John S., M.D., FAAFP, president, American Academy of
      Family Physicians, Leawood, KS.................................     7
    Opelka, Frank, M.D., FACS, medical director for quality and
      health policy, American College of Surgeons, Chicago, IL.......     8
    Hines, Scott, M.D., director, American Medical Group Association,
      Alexandria, VA.................................................    10
    Fiedler, Matthew, Ph.D., fellow, USC-Brookings Schaeffer
      Initiative for Health Policy, Brookings Institution,
      Washington, DC.................................................    12

                   ALPHABETICAL LISTING AND APPENDIX MATERIAL

    Cullen, John S., M.D., FAAFP:
        Testimony....................................................     7
        Prepared statement...........................................    37
        Responses to questions from committee members................    41
    Fiedler, Matthew, Ph.D.:
        Testimony....................................................    12
        Prepared statement...........................................    54
        Responses to questions from committee members................    65
    Grassley, Hon. Chuck:
        Opening statement............................................     1
        Prepared statement...........................................    70
    Hines, Scott, M.D.:
        Testimony....................................................    10
        Prepared statement...........................................    71
        Responses to questions from committee members................    75
    McAneny, Barbara L., M.D.:
        Testimony....................................................     5
        Prepared statement...........................................    82
        Responses to questions from committee members................    85
    Opelka, Frank, M.D., FACS:
        Testimony....................................................     8
        Prepared statement...........................................   105
        Responses to questions from committee members................   110
    Wyden, Hon. Ron:
        Opening statement............................................     3
        Prepared statement...........................................   122

                                 Communications

    Alliance of Specialty Medicine...................................   125
    American Academy of Ophthalmology................................   129
    American Association of Orthopaedic Surgeons.....................   132
    American College of Physicians...................................   133
    American Hospital Association....................................   139
    American Society of Clinical Oncology............................   142
    Center for Fiscal Equity.........................................   146
    Healthcare Leadership Council....................................   148
    Medical Group Management Association.............................   150
    Medicare Payment Advisory Commission (MedPAC)....................   153
    National Association of ACOs.....................................   160
    Premier Inc......................................................   165
    Society of Hospital Medicine.....................................   166
    Society of Thoracic Surgeons.....................................   169

                       MEDICARE PHYSICIAN PAYMENT REFORM
                        AFTER TWO YEARS: EXAMINING MACRA
                       IMPLEMENTATION AND THE ROAD AHEAD

                                  ----------

                             WEDNESDAY, MAY 8, 2019

                                           U.S. Senate,
                                          Committee on Finance,
                                                        Washington, DC.
        The hearing was convened, pursuant to notice, at 9:31 a.m.,
    in room SD-215, Dirksen Senate Office Building, Hon. Chuck
    Grassley (chairman of the committee) presiding.
        Present: Senators Roberts, Thune, Scott, Cassidy, Daines,
    Young, Wyden, Cantwell, Carper, Cardin, Brown, Casey, Warner,
    Whitehouse, Hassan, and Cortez Masto.
        Also present: Republican staff: Jeffrey Wrase, Deputy Staff
    Director and Chief Economist; Brett Baker, Senior Health Policy
    Advisor; and Karen Summar; Chief Health Policy Advisor.
    Democratic staff: Joshua Sheinkman, Staff Director; Elizabeth
    Jurinka, Chief Health Policy Advisor; Beth Vrabel, Deputy Chief
    Counsel and Senior Health Counsel; and Maura Fitzsimons,
    Professional Staff Member.

     OPENING STATEMENT OF HON. CHUCK GRASSLEY, A U.S. SENATOR FROM
                  IOWA, CHAIRMAN, COMMITTEE ON FINANCE

        The Chairman. The meeting will come to order. And for all
    the members, and particularly for our witnesses who had to work
    so hard to get ready for this hearing, it is going to be kind
    of discombobulated. That is not the right word--it is going to
    be mixed up, you know, because we have five votes at 10
    o'clock. So we are starting a half-hour early, and we are going
    to try to keep the meeting going by different people chairing
    the hearing so we can keep going. So I hope everybody will--I
    know everybody will cooperate, but it is not the best thing for
    a very important subject we have before this hearing to have it
    interrupted in this way.
        I want to thank our witnesses for being here today. We look
    forward to hearing how physician payment reform and the
    Medicare Access and CHIP Reauthorization Act are driving good
    patient outcomes. This law of 4 years ago goes by the acronym
    MACRA. MACRA also took the historic step of getting rid of the
    flawed sustainable growth rate formula which, when it was
    passed, we did not think anything about it was flawed. We
    thought it was an answer to a lot of problems for keeping
    things updated regularly.
        So, let me take a moment to go through the history of SGR,
    as the saga ended with a hopeful message. Congress established
    it in 1997 as a mechanism to control Medicare spending on
    physician services. The formula worked at first, but it was not
    long before it called for large reductions in payments that,
    obviously, we could not tolerate because they threatened access
    to care.
        This then set in motion a perpetual exercise where Congress
    scrambled, usually once a year, sometimes twice a year, to
    prevent physicians from being cut in reimbursement. So 17 times
    that went on over a period of a decade. And each time, we
    kicked the can down the road without solving the underlying
    problem. Finally, 2015 came. Congress came together and passed
    the MACRA law by an overwhelming margin in both chambers. MACRA
    showed that Congress can still work together in a bipartisan
    manner when it is necessary, and we ought to be working more
    when it is not necessary.
        This reminder reinforces my beliefs that the bipartisan
    Finance Committee process to lower prescription drug costs can
    also be successful. That is our present responsibility. It
    bodes well for making changes in Medicare to improve access to
    care for patients in rural and underserved areas. And a little
    bit down the road, that is another goal we are working on. And
    in fact, it is being worked on now. This is something that
    Ranking Member Wyden and I are committed to.
        These bipartisan efforts also provide a glimmer of hope
    that Republicans and Democrats can join together to prevent
    Medicare from going broke. And I would urge people on both
    sides of the aisle to think about putting that high on the
    agenda. This is time better spent than trying to expand
    Medicare for all only for it to, invariably, end up available
    to none.
        MACRA payment reforms established incentives for physicians
    to provide the highest quality of care at the lowest possible
    cost. Physicians can pick from two different paths. They can
    opt to be graded on metrics in a number of different
    categories, or choose to get paid under a different model such
    as single payment for bundled services. This committee held a
    hearing in 2016 on the initial plan by the Centers for Medicare
    and Medicaid Services to implement these reforms. While the CMS
    implementation remains a work in progress, the 2 years of
    experience allows us to take stock of how well these reforms
    are working.
        So that is why we brought together this group of witnesses
    that we have, physicians and other experts who are at the
    forefront of these efforts. Physicians' organizations that
    represent different specialties and practice characteristics
    are at the table. This diversity of physician practice mirrors
    the varying needs of Medicare patients. It also highlights the
    inherent challenge of getting top-notch care to everyone,
    including those in rural areas.
        I am proud that physicians in Iowa provide high-quality
    care while spending less than many other areas. This is a value
    that MACRA payment reform aimed to achieve. I look forward to
    hearing from our witnesses their analysis of it.
        [The prepared statement of Chairman Grassley appears in the
    appendix.]
        The Chairman. Senator Wyden?

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

        Senator Wyden. Thank you very much, Mr. Chairman. Mr.
    Chairman, this is another topic where you and I are working
    closely together, as we are on prescription drugs. And with the
    chairman's leave, I am going to make a brief statement on
    behalf of both of us, because there is some particularly sad
    news this morning. The legendary New York Times health reporter
    Robert Pear passed away yesterday.
        And he was the gold standard of health-care reporting. The
    chairman and I were just talking about it. He was fair to
    everybody, Republicans on this committee, the chairman,
    Chairman Hatch. I am sure everyone who has worked on health
    care worked with Robert Pear. He was described as the most
    important reporter in Washington, DC that nobody had ever heard
    of. Also, he did not let anybody get away with anything,
    whether you were a Democrat or Republican.
        And--this is a hard statement to make. Robert Pear probably
    remembered the amendment to the amendment to the amendment of
    some health-care bill 3 decades ago. And it was that commitment
    to professionalism that was so appreciated by Democrats and
    Republicans.
        And I noticed this morning--all over the country for
    decades, everybody waited for a Robert Pear story. He was
    essentially the barometer of what the facts were in health
    care. And The New York Times had a slug called, kind of,
    ``Health by Pear,'' something like that. The New York Times
    this morning said they are going to retire the slug.
        And I just think for all of us, and this committee, the
    chairman--and I think about Chairman Hatch who also adored
    Robert Pear--this is a really sad moment, because a really good
    guy who cared passionately about people, and passionately about
    improving health care, and was always trying to appeal to the
    better angels, passed away yesterday, way too young at 69.
        So, Mr. Chairman, thank you. I have a brief statement on
    MACRA, but----
        The Chairman. You spoke for me as well, because he
    interviewed me an awful lot. And I always felt I was treated
    fairly.
        Senator Wyden. Four years ago--Robert Pear covered this
    too--the committee led the effort to revolutionize the way
    doctors are paid under Medicare. And basically what we did back
    then--I think Senator Roberts remembers this too--is we threw
    in the dustbin of history the old way of reimbursing for health
    care. ``We are going to say it is not about quantity. It is
    about quality.'' That was the basic principle in stone that we
    engraved.
        As the chairman noted, the MACRA law has now been in place
    for 2 years. We have been watching its implementation. There
    are a few, kind of key issues that we care about. The chairman
    and I have a strong view with respect to small practices in
    rural and underserved areas. Senator Roberts cares about this
    deeply too. The rural docs are the backbone of communities in a
    lot of ways. You do not have a rural life without rural health
    care.
        So it is absolutely essential that as we reward value in
    health care, we make sure--I have heard Senator Roberts talk
    about this many times; Senator Grassley and I are talking about
    it now. We want to make sure docs in small and rural practices
    are not left behind, otherwise that is going to degrade the
    care rural patients get, and we will have an even bigger gap
    between the cities and suburbs and the little towns.
        Second, when it comes to assessing quality, we want to make
    sure that the docs are not going through bureaucratic water
    torture. They should not be just checking boxes all day long.
    We want to reward doctors for care that really--we want to
    reward all those who practice improved quality, what is
    impactful for patients' health. But we do not want to make this
    some sort of exercise in form-filling and bureaucracy and red
    tape.
        The last point I want to make--I appreciate the chairman
    giving me this extra time--is we want to wring more value out
    of taxpayer dollars in Medicare while coordinating the care
    that seniors need. And we have done that through Accountable
    Care Organizations, medical homes, bundled payments--we have
    used a variety of approaches to do it.
        And last Congress, we passed a historic Medicare bill. If
    you walked on the streets of Kansas, Iowa, Rhode Island,
    Nevada, anywhere you are, I do not think people would know, but
    what we did on a bipartisan basis is we said, you know, the
    Medicare program of 2019 does not resemble the Medicare program
    when I was director of the Gray Panthers, when Robert Pear
    started.
        That program was about acute illness. You broke an ankle,
    you went to the hospital--Part A. You had a bad case of the
    flu, you went to the doc--Part B. That is not Medicare anymore.
    Today it is cancer, diabetes, heart disease, strokes. It is
    chronic illness. That is the whole Medicare budget. So we
    recognized that with our CHRONIC Care bill. It is going to be
    historic.
        So I just want to close by mentioning the next step. The
    next step ought to be to guide countless seniors who are
    getting lost in this blizzard of modern health care-red tape,
    the forms, the prescription requirements, the instructions, the
    pill bottles--it is almost too much for a lot of the seniors
    with these chronic conditions to go through. And, if they are
    in traditional Medicare where we still have well over half the
    seniors, it is twice as bad as if they had coordinated care
    through Medicare Advantage or Accountable Care Organizations.
        So, as a former basketball player, I want to put the next
    step in basketball terms. Every senior with chronic illness
    ought to have what I am calling a chronic care point guard,
    somebody who manages their care and makes sure that the docs
    have all the information and that they can work together. In
    basketball terms it was called having somebody running the
    floor--you know, basically coordinating everything. And whether
    a senior is in traditional Medicare or MA, whatever it is, this
    can avoid a lot of mistakes.
        Mr. Chairman, thank you. I know it was a juggle for you,
    Mr. Chairman, to try to figure out how to do it. And you tried
    to give everybody notice, and we appreciate it.
        And I look forward to working with you on what I will just
    say, again, is a very, very sad day for all of us who watched a
    good man work a lot, sitting right over there at that table. I
    am missing him right now, right at that table for 3 decades.
    Thank you.
        [The prepared statement of Senator Wyden appears in the
    appendix.]
        The Chairman. Thank you for speaking about Mr. Pear, and
    you did accurately say that you spoke for me. And I was glad
    you informed me of it, because I did not know about it.
        I am going to introduce witnesses now. Dr. Barbara McAneny
    just told me a little while ago that she went to Grinnell and
    the University of Iowa. So thank you for being here. She is
    president of the American Medical Association and has served as
    a member of the board of trustees of that organization since
    2010.
        Dr. John Cullen is president of the American Academy of
    Family physicians. He is a practicing physician in Valdez, AK.
        Dr. Frank Opelka is a physician executive, a surgeon, and a
    medical director of quality and health policy at the American
    College of Surgeons.
        Dr. Scott Hines is Crystal Run Healthcare's chief quality
    officer, medical director, and physician leader for Crystal Run
    Healthcare's medical specialties division.
        And Dr. Matthew Fiedler is a fellow with the USC-Brookings
    Schaeffer Initiative for Health Policy. His research is focused
    on health-care economics and policy.
        We are grateful for your taking the time to come and help
    us analyze MACRA. I always tell people you probably have very,
    very long statements that you want to put in the record, and
    they will be put in the record, and you will not have to ask.
        Proceed with your 5 minutes, Dr. McAneny.

      STATEMENT OF BARBARA L. McANENY, M.D., PRESIDENT, AMERICAN
                    MEDICAL ASSOCIATION, CHICAGO, IL

        Dr. McAneny. Thank you very much, Mr. Chairman. I am
    Barbara McAneny. I am an oncologist from New Mexico and
    president of the American Medical Association. Thank you for
    inviting us to this hearing on MACRA. As background, my
    practice is the New Mexico Cancer Center, which used to serve
    in Albuquerque and four rural centers. Recently we have had to
    close three rural cancer clinics.
        Since the enactment of MACRA, the AMA has worked closely
    with Congress and CMS to promote a smooth implementation of the
    Quality Payment Program. We have worked closely with CMS to
    make needed improvements in the MIPS program each year and
    appreciate the technical changes to MACRA that Congress
    included in the BBA18 to simplify and improve the program.
        Our work is not done. To the contrary, the QPP still needs
    significant improvements. Implementation of a new Quality
    Payment Program is a significant undertaking. Congress, CMS,
    and the medical community must continue to work together to
    make the program better for patients and less burdensome for
    their physicians.
        First, we must continue to ensure that small and rural
    practices can succeed. The AMA has strongly supported the
    accommodations that Congress and CMS have made for small
    practices, including the low-volume threshold, which excludes
    numerous practices that see very few Medicare patients. We have
    also supported hardship exemptions from the Promoting
    Interoperability category and technical assistance grants to
    help small and rural practices.
        However, recent scores from the first performance year show
    that small and rural practices scored lower than the average
    for MIPS-eligible clinicians. This is why we need to continue
    to support small and rural practices and make sure all patients
    can succeed in MIPS to preserve the infrastructure for health-
    care delivery in rural areas.
        Second, one important goal of MACRA was to provide busy
    physicians with a path to transition into new innovative
    payment models. To facilitate this transition, Congress
    provided a 5-percent incentive for physicians to participate in
    APMs during the first 6 years of the program. These payments
    were intended to allow physicians to invest in changing the way
    we deliver care. The AMA heard from many physician groups that
    are excited to take advantage of this opportunity.
    Unfortunately, during the first 3 years of the program, too few
    APM options were available for physicians. And now only 3 years
    remain, which is not enough time for physicians to transition
    to an APM.
        The AMA is encouraged by our recent discussions with CMS
    Administrator Seema Verma and CMMI Director Adam Boehler and
    their commitment to implement physician-focused payment models
    that give physicians the resources and the flexibility that
    they need to participate in APMs, such as the new Primary Care
    First model announced in April. Therefore, we urge Congress to
    extend the APM incentive for an additional 6 years.
        Third, the AMA is recommending that Congress replace the
    scheduled physician payment freeze beginning in 2020 with
    positive annual updates for physicians. The recent Medicare
    trustee report found that scheduled physician payments are not
    expected to keep pace with physician practice costs. As a
    result, the trustees say access for Medicare patients will be a
    significant issue in the future. Positive payment updates are
    needed to provide physicians a margin to maintain their
    practice as well as transition to more efficient models of care
    delivery. Therefore, we urge Congress to reinstate positive
    payment updates for physicians beginning next year.
        Finally, the AMA urges Congress to continue to make
    technical changes to MACRA to simplify the program and make it
    more clinically significant. The AMA continues to hear from
    physicians that the measures they are required to report are
    taking time away from patient care.
        In conclusion, the AMA thanks the committee for your work
    on this issue. And we remain committed to working with CMS and
    Congress to implement many of these improvements and to ensure
    that the MACRA program is successful.
        Thank you.
        The Chairman. Thank you, Dr. McAneny.
        [The prepared statement of Dr. McAneny appears in the
    appendix.]
        The Chairman. Now, Dr. Cullen.

     STATEMENT OF JOHN S. CULLEN, M.D., FAAFP, PRESIDENT, AMERICAN
               ACADEMY OF FAMILY PHYSICIANS, LEAWOOD, KS

        Dr. Cullen. Thank you, Chairman Grassley, Ranking Member
    Wyden, and members of the committee. I am honored to be here
    today representing the more than 140,000 members of the
    American Academy of Family Physicians. I am a practicing family
    physician in Valdez, AK, a community of about 4,000 people.
    With my four family medicine colleagues, we staff an
    independent clinic in a critical access hospital 300 miles from
    the nearest tertiary care hospital. Our census area is about
    the size of Ohio.
        Four years ago, the Medicare Access and CHIP
    Reauthorization Act, or MACRA, was signed into law, and today's
    hearing is an appropriate opportunity to step back and evaluate
    how this law is performing. After 4 years, the AAFP still
    considers MACRA an appropriate framework for the physician
    payments in the Medicare program. And while I will outline
    several concerns with how the law is functioning, the
    philosophy and the framework of MACRA remain consistent with
    AAFP policy. We are especially supportive of those policies
    that allow physicians to pursue delivery and payment models
    that support the delivery of comprehensive, continuous, and
    coordinated primary care rather than fee-for-service. We are
    also pleased with the low-volume threshold that has protected
    many rural and independent practices from the negative
    consequences of MIPS. While we strongly support the low-volume
    threshold, we are pleased that CMS has created an optional
    voluntary pathway for small practices to compete within the
    MIPS arena.
        MACRA, through the Advanced Alternative Payment Model
    pathway, created an opportunity for physicians to pursue non
    fee-for-service payment models that support advanced delivery
    models. And MACRA also created an opportunity for physicians to
    create and propose Alternative Payment Models through the
    Physician-
    Focused Payment Model Technical Advisory Committee or PTAC.
        On April 22nd, CMS and CMMI announced CMS's Primary Cares
    Initiative, one of two new primary care models that will expand
    opportunity to thousands of family physicians who will be able
    to participate in an APM. And one of those new models, the
    Primary Care First program, is largely reflective of the AAFP's
    proposal submitted to and approved by PTAC in 2017.
        The AAFP continues to have collaborative engagements with
    CMS and CMMI on this important work. And, as previously
    mentioned, the AAFP believes that there are areas where the law
    could be improved. And, in our written testimony, we outline
    five areas of concern, but I am only going to focus on two of
    those. One is creating a culture focused on patient care, and
    the second is eliminating the complexity of MIPS scoring.
        It is well documented that the volume and intensity of
    administrative functions are having a negative impact on
    physicians. And the AAFP is concerned that the complexity and
    the cost of administrative functions are creating practice
    environments that are more focused on administrative tasks than
    on patient care. And we should ask physicians to really focus
    on their patients and not checking boxes. And that is how we
    are going to improve patient satisfaction, outcomes, and
    Medicare costs.
        A study published in the Annals of Internal Medicine found
    that primary care physicians spend 2 hours completing
    administrative tasks for every hour of patient care. We are
    concerned that MIPS has created a burdensome and extremely
    complex program that has increased practice costs and is
    contributing to physician burnout. Understanding the
    requirements and scoring for each MIPS performance category and
    reporting required data to CMS is a complex task and detracts
    from physicians' ability to focus on patients. Many of my
    colleagues are frustrated and angry.
        The AAFP supports CMS's Patients Over Paperwork initiative
    but believes that more must be done to improve patient care
    within the MIPS program by reducing administrative burdens. And
    we urge Congress to work with CMS to reduce the complexity and
    the administrative burden of MIPS. The AAFP has outlined a
    number of technical corrections and policy recommendations in
    our written statement. I would like to highlight three.
        First, MACRA established an annual increase of .5 percent
    in physician payments from July 2015 through 2019. We would
    urge the committee to extend that annual .5-percent payment for
    5 more years.
        Second, the AAFP would recommend that the exceptional
    performance bonus payments be reimagined to reward practices
    that achieve significant year-over-year improvement, versus
    rewarding those practices at the upper levels of annual
    performance.
        And lastly, AAFP recommends that the 5-percent bonus for
    qualifying physicians participating in an APM be extended for
    an additional 3 to 5 years.
        Again, we thank you for holding today's hearing and for
    your continued commitment to ensuring Medicare physician
    payment policies are contributing to the delivery of timely,
    affordable, and high-quality care to beneficiaries.
        [The prepared statement of Dr. Cullen appears in the
    appendix.]
        The Chairman. Dr. Opelka?

      STATEMENT OF FRANK OPELKA, M.D., FACS, MEDICAL DIRECTOR FOR
       QUALITY AND HEALTH POLICY, AMERICAN COLLEGE OF SURGEONS,
                              CHICAGO, IL

        Dr. Opelka. Chairman Grassley, Ranking Member Wyden, and
    members of the committee, thank you for inviting the American
    College of Surgeons to testify at this important hearing. The
    College supports MACRA's focus on quality and value. However,
    we are concerned that a hurried CMS implementation has resulted
    in quality metrics that left surgical care as an afterthought.
    We would like to spend our time today discussing how we would
    put quality and value at the forefront of patient care.
        MACRA was intended to move payments away from fee-for-
    service in hopes of finding new means for rewarding a care team
    for improving quality and reducing costs for surgery. This
    requires a strategy that defines the surgical care team and
    creates value for the surgical patient. Defining surgical value
    is simply not in the wheelhouse of the insurance industry.
    Thus, CMS continues to struggle, especially when they rely on
    their skills as a payer to retrofit a tired fee-for-service
    payment model with sporadic measures which do not make sense
    for the surgical care teams and outcomes patients seek.
        For many physicians, the Merit-based Incentive Payment
    System has not--and given its current trajectory--will not
    serve as a driver of improvement in quality or reduction of
    cost. The greatest percentage of surgeons participate in
    quality reporting through the CMS Web Interface group reporting
    option, and many are not even aware of the measures reported.
    Measures available in the Web Interface are focused on
    screening, preventive care, and diabetes. In other words,
    surgeons receive credit for how well their group practice
    immunizes a population instead of assuring a patient has safe
    surgical care.
        MACRA states that whenever possible, group measurement
    should reflect the range of items and services furnished by an
    eligible clinician in the group. But that is currently not the
    case. Many believe that other provisions of MACRA, such as the
    emphasis on registries and the pathway for APM creation and
    measured development funding, would create outlets for more
    specialty-specific measure development. But that has not
    materialized.
        ACS has a vision for what we believe meaningful measure of
    surgical quality care looks like. We believe the quality of
    surgical care begins by setting evidence-based standards for
    care and ensuring the right infrastructure and systems are in
    place through measurement and verification, incorporating data
    at the point of care to inform surgeons' and patients'
    decisions. We would propose a surgical quality measurement
    structure that has three components: verification of key
    standards of care, clinical outcome measures, and
    patient-reported outcomes.
        In 2017, the ACS published optimal resources for surgical
    quality and safety, referred to as the Red Book. This framework
    is based on decades of research and implementation of
    verification programs which have proven successful in driving
    better patient outcomes and surgical care. Standards drawn from
    the Red Book are now being used for the verification
    accreditation of hospitals on the basis of surgical quality and
    patient safety. Clinical outcomes and surgery can be measured
    based on a combination of claims-based measures combined with
    rigorous clinical data from programs such as the National
    Surgery Quality Improvement Program.
        Finally, the addition of patient-reported outcome measures
    tailored in an episode of care bring in the patient's voice and
    can assess whether the care achieves the patient's goals,
    including functional status and quality of life.
        While the focus of this testimony is improving incentives
    for quality and value, the American College of Surgeons urges
    Congress to put MACRA implementation in the context of the
    current Medicare reimbursement rates, which have not kept pace
    with inflation and do not adequately cover the costs associated
    with providing care. Furthermore, the ACS has great concerns
    about the structure of payments under MACRA in the years ahead.
    The modest statutory updates included in the law are now
    finished, and we will soon enter a 6-year period with no
    updates. This will likely result in real reductions to payments
    due to inflation and budget neutrality. Physicians will view
    the further implementation of MACRA from this perspective. The
    ACS would welcome the opportunity to further describe the
    physician payment landscape from our perspective and how this
    might affect the future of access to care.
        In closing, what matters most to patients and providers is
    safe, more efficient, high-quality surgical care. ACS believes
    the intent of MACRA is correct. We, as the ACS, remain
    committed to you and look forward to working with Congress and
    the administration to ensure that we can get this right for our
    patients. Congress should encourage CMS to partner with the
    physician community to evaluate and test innovative evidence-
    based proposals such as the one we have described. We believe
    CMS has the authority to accomplish this but may benefit from
    additional guidance from Congress.
        CMS would also require additional resources to administer
    the QPP in a way which refocuses the incentives toward higher-
    value care and improves the quality of care for Medicare
    patients. This would go a long way toward assuring the long-
    term viability and success of the QPP and MACRA programs.
        The Chairman. Thank you, Dr. Opelka.
        [The prepared statement of Dr. Opelka appears in the
    appendix.]
        The Chairman. Now, Dr. Hines.

      STATEMENT OF SCOTT HINES, M.D., DIRECTOR, AMERICAN MEDICAL
                   GROUP ASSOCIATION, ALEXANDRIA, VA

        Dr. Hines. Chairman Grassley, Ranking Member Wyden, and
    distinguished members of the Senate Finance Committee, thank
    you for the opportunity to testify before you today. I am Dr.
    Scott Hines, and I am here on behalf of AMGA, where I serve as
    chair of their public policy committee and member of their
    board of directors. AMGA represents multi-specialty medical
    groups and integrated delivery systems across the United
    States. More than 175,000 physicians practice in AMGA member
    organizations, delivering care to one in three Americans.
        I am board-certified in internal medicine and
    endocrinology, and I am Crystal Run Healthcare's chief quality
    officer. Crystal Run employs over 450 providers across 50
    different specialties in 20 locations throughout the lower
    Hudson Valley of New York State. We are among the first 27
    Accountable Care Organizations to participate in the Medicare
    Shared Savings Program since 2012. In my role as chief quality
    officer, I have helped to develop and implement the clinical
    programs necessary to deliver value-based care to our patients.
        Policy-makers in Congress and the administration have made
    clear their intent to transform the way health care is financed
    and delivered in this country. The need to move Medicare to
    value is evident today more than ever, and I believe Congress
    passed MACRA to drive that transition to value in Medicare Part
    B.
        Our current fee-for-service payment system is not
    sustainable and is not the model best suited to provide
    coordinated, high-
    quality, cost-effective care to our patients. AMGA members are
    looking to Congress for a stable, predictable value program
    that creates meaningful and realistic incentives that motivate
    them to make the multimillion-dollar investment to chart a
    course towards value.
        MIPS was designed as a transition tool, an on ramp to
    value-based payment in the Medicare program. However, CMS has
    not implemented MIPS as Congress intended. Under MACRA, MIPS
    providers would have the opportunity for positive or negative
    payment adjustments based on their performance, starting at
    plus or minus 4 percent in 2019 and increasing to plus or minus
    9 percent in 2023. By putting provider reimbursement at risk,
    Congress intended to move Medicare to a value-based payment
    model where high performance was rewarded and poor performers
    were incentivized to improve through lower payment rates.
    Despite the MACRA statute, CMS has excluded nearly half of
    eligible clinicians from MIPS requirements through their MACRA
    regulations.
        Because MIPS is budget-neutral, these exclusions result in
    insignificant payment adjustments to high-performing providers.
    Rather than a 5-percent and 7-percent maximum payment
    adjustment for high performers in 2020 and 2021 respectively,
    these exclusions are resulting in only a 1.5- to 2-percent
    increase. By excluding half of providers from MIPS, the system
    has devolved into an expensive regulatory compliance exercise
    with little impact on quality or cost.
        Now, I understand the concerns for my colleagues, for
    physicians practicing in solo or smaller practices, and that
    the reporting burden on them is at times significant. However,
    we must recall that the MIPS program is a continuation of
    quality programs that have existed for years, where previously
    no one was excluded from participating, let alone half of those
    eligible.
        For Advanced APMs, the other pathway to value under MACRA,
    the system's requirements need to be revised to allow for
    increased APM participation. To qualify for the program,
    providers must meet or exceed minimum revenue thresholds from
    APMs or a minimum number of Medicare beneficiaries in these
    models. These thresholds progressively increase over time, and
    AMGA members feel that these requirements are unrealistic,
    unlikely to be met, and will not attract the number of
    physicians and medical groups necessary to ensure the program's
    success. In fact, these arbitrary thresholds serve as a
    disincentive for AMGA members to make the multimillion-dollar
    investments needed to move to value.
        By eliminating these arbitrary thresholds and extending the
    APM program beyond a 2024 sunset date, Congress would be
    indicating to the health-care community that it is willing to
    offer a stable and predictable risk platform to providers ready
    to move to value. I truly believe Congress passed MACRA to
    drive the transition to value in Medicare Part B. However, we
    have clearly taken a step back from this transition over the
    past 3 years by excluding half of eligible clinicians from MIPS
    and enforcing arbitrary threshold requirements for Advanced
    APMs.
        On behalf of AMGA and Crystal Run Healthcare, we are ready
    to work with Congress and CMS to ensure that MACRA can serve
    its intended purpose in moving our Medicare system towards
    value. Thank you.
        The Chairman. Thank you, Dr. Hines.
        [The prepared statement of Dr. Hines appears in the
    appendix.]
        The Chairman. Now, Dr. Fiedler.

      STATEMENT OF MATTHEW FIEDLER, Ph.D., FELLOW, USC-BROOKINGS
    SCHAEFFER INITIATIVE FOR HEALTH POLICY, BROOKINGS INSTITUTION,
                             WASHINGTON, DC

        Dr. Fiedler. Chairman Grassley, Ranking Member Wyden,
    members of the Finance Committee, thank you for inviting me to
    testify today. My name is Matthew Fiedler, and I am a fellow at
    the USC-Brookings Schaeffer Initiative for Health Policy, but
    this testimony reflects my personal views.
        I am honored to be here to discuss MACRA's physician
    payment provisions. MACRA made important reforms to the
    structure of Medicare physician payment with the goal of
    improving the quality and efficiency of the care received by
    Medicare beneficiaries. With 2 years' experience behind us, now
    is an opportune time to take stock.
        I will start with what is working well. In my view, MACRA's
    bonuses for participation in Advanced Alternative Payment
    Models, such as Accountable Care Organization models with two-
    sided risk, have great potential. Recent research on ACOs,
    which account for most APM and Advanced APM participation in
    Medicare, has found that these models can reduce health-care
    spending while maintaining or improving quality.
        There has been a substantial increase in Advanced APM
    participation as MACRA's bonus payments have been implemented.
    In 2018, around 9 percent of traditional Medicare beneficiaries
    were served by providers and ACOs with two-sided risks, up from
    3 percent in 2016. MACRA's bonuses likely contributed to this
    increase, although other factors likely contributed as well.
        The Advanced APM bonus has also encouraged CMS to be more
    aggressive in deploying APMs that create stronger incentives to
    reduce spending. This includes making needed improvements to
    the calculation of the benchmarks used to judge ACO spending
    performance and increasing how quickly ACOs must transition to
    two-sided risk. While I am optimistic about MACRA's Advanced
    APM bonus, I am pessimistic about MIPS. MIPS's approach of
    adjusting payments based on clinician or practice-level
    performance is ill-suited to creating strong, coherent
    incentives to improve the quality and efficiency of patient
    care.
        One problem is that a given patient's care often involves
    many different providers. Another problem is that clinician-
    and practice-level performance measures can be quite noisy. The
    fact that clinicians can choose the quality measures they
    report under MIPS also prevents MIPS from facilitating
    meaningful quality comparisons across providers. Consistent
    with these concerns, research on programs similar to MIPS, such
    as the Value Modifier program that preceded MIPS, provides
    little evidence that programs like these improve the quality or
    efficiency of patient care. MIPS is, however, creating
    significant administrative costs. CMS estimates that providers
    will spend $482 million reporting to MIPS in 2019. It is hard
    to justify incurring these costs for a program that is unlikely
    to meaningfully improve care.
        Looking to the future, I encourage policy-makers to build
    on what is working in MACRA and discard what is not. A good
    first step would be to make MACRA's Advanced APM bonus
    permanent. Doing so sooner, rather than later, would maximize
    the bonus's impact by encouraging providers to make long-term
    investments in APM participation today.
        But it would be valuable to go further and substantially
    strengthen MACRA's incentives for participation in Advanced
    APMs, both by increasing the size of MACRA's incentive payments
    and by expanding these incentives to new categories of
    providers, like hospitals. These approaches would increase
    participation in Advanced APMs, broaden the types of providers
    with a stake in the deployment and success of these models, and
    enable CMS to go further in deploying versions of APMs that
    create stronger incentives to reduce spending.
        It would be important to structure expanded incentives for
    Advanced APM participation in ways that do not increase Federal
    costs. For example, Congress could implement a budget-neutral
    combination of larger bonuses for Advanced APM participation
    and penalties for non-participation, similar to how Congress
    combined bonuses and penalties under MIPS. Policy-makers may
    also wish to consider eliminating the cliff in the Advanced APM
    bonus eligibility rules, which may soon cause some providers
    with significant engagement in Advanced APMs to miss out on
    bonus payments.
        Turning to MIPS, I agree with MedPAC and a number of other
    experts that the best path forward is to eliminate MIPS. Most
    of MIPS's problems are unavoidable in a program that adjusts
    payments based on clinician- or practice-level performance. So
    even a reformed MIPS would likely struggle to create coherent
    and effective incentives to improve care.
        If MIPS were eliminated, policy-makers could still retain
    targeted incentives for certain activities, like using a
    certified electronic health record or reporting to clinical
    registries. If MIPS continues, there are opportunities for
    improvement, although there are limits to what a reform in its
    program could realistically achieve. Potential improvements
    include standardizing the measures used in the MIPS quality
    category, replacing the MIPS practice improvement category with
    a targeted incentive for reporting to clinical registries, and
    replacing the MIPS Promoting Interoperability category with a
    simpler incentive for using a certified EHR.
        Thank you again for the opportunity to testify. I look
    forward to your questions.
        The Chairman. Let me thank all of you for staying within
    the 5 minutes.
        [The prepared statement of Dr. Fiedler appears in the
    appendix.]
        The Chairman. It is very helpful, particularly on a day
    like today when things are kind of erratic.
        My first question is going to be just to Dr. Opelka, and
    the second one I will have for all of you to answer. The
    statute recognizes the value of data registries as they measure
    physicians on the things that they themselves identify as
    important to their patients. These data registries also provide
    timely feedback that physicians can use to improve. I am
    concerned about the statement in your testimony that these
    registries face challenges that have limited physician uptake.
        Could you elaborate on the problems that have limited
    physicians' use of data registries and provide suggestions for
    how we can knock down these barriers? And if you are not
    prepared to offer suggestions, maybe you can submit those in
    writing. But go ahead and answer as best you can now.
        Dr. Opelka. Thank you, Mr. Chairman. We will give you a
    more detailed response, because this is a very complex subject.
    We do firmly believe in registries. We run seven international
    registries to date. But putting them into the MIPS payment
    program or the MACRA programs is not actually taking full
    advantage of how you would leverage data for better care. And
    that is what we use registries for.
        The biggest challenge we have out there, I can give you in
    a simple analogy. Imagine if every airport had its own air
    traffic control tower with its own data system and they did not
    talk to each other. We would have a mess up in the air. That is
    what we have with all these registries.
        What we need is government guidance about how we actually
    set standards in key areas, how we define the data that enters
    registries, how that data actually is aggregated in a
    consistent manner so it comes in cleanly, how we can normalize
    and analyze that data together, and how we can represent it
    back out to patients and physicians as it is needed.
        Right now, it is the Wild West. Everybody knows this is a
    great way of generating knowledge and helping better care, so
    everyone is doing it, and it becomes a burden on the EHR. It
    becomes a burden on the clinicians trying to use it. And it is
    creating cacophony.
        Your success stories are in registries where there is a
    single source of truth, such as the ophthalmology registry or
    the cardiac surgery registry or the ACC registry where there is
    only one single source of truth. We find we can go there and
    find what we need for patients. When everyone out there creates
    their own version, we have a mess.
        The Chairman. We will look forward to your submitting those
    suggestions. For the others--for all of you, I notice that all
    the witnesses focus on the need for changes to make these
    payment reforms more meaningful to physicians and more relevant
    to the patients they treat. What is the single most important
    change that would have the biggest impact in the effort to get
    patients the best care at the lowest possible cost?
        Let us start with you.
        Dr. McAneny. Thank you, Mr. Chairman, for that question. I
    think the first and most important thing that we could do would
    be to have a continued positive update. If physician practices,
    particularly small and rural practices, are unable to maintain,
    they do not have any additional resources to be able to modify
    their processes and make changes. It is a little like trying to
    drive a car down the freeway and change the tires at the same
    time.
        We are as busy as we can be taking care of patients. Making
    changes requires additional efforts.
        Secondly, we need more opportunities for Advanced
    Alternative Payment Models. We believe that the MIPS APMs are a
    good proving ground to start with some changes and let
    physicians start working with that. So we would like to see
    expansion of that and stability in the program so that we have
    time to make those changes.
        And third, I would say we need to continue the Advanced APM
    updates past the 3 remaining years, because without those
    incentive programs, there is very little reason for people to
    go through the large amount of effort. We could also streamline
    a lot of the reporting processes. Electronic health records are
    not good at sending data off to CMS or anyone else. They are
    adequate, barely, for treating patients one at a time. They are
    not designed for submitting data, and we would appreciate help
    from CMS and from Congress to help the electronic health record
    industry be more responsive to physician needs.
        The Chairman. Thank you. Dr. Cullen?
        Dr. Cullen. And I would actually agree with that as well.
    You know, for the last 2 years, we have been educating our
    members about MIPS and Advanced Alternative Payment Models. We
    have been trying to get everybody into Advanced Alternative
    Payment Models as soon as possible. We have been calling MIPS
    ``The Hunger Games.''
        But one of the problems has been that it has just taken so
    long to roll these out that we really have not had any members
    being able to really take advantage of them. We know that with
    advanced primary care, for every dollar you invest in advanced
    primary care, you save $13 at the end. And so if we are looking
    at ways to reduce costs, I think that is important.
        And I would absolutely agree that our electronic records
    really do not do a good job of allowing us to really collate
    the data to be able to send it out. I am actually one of those
    practices that is in the low-volume exclusion, and thank
    goodness, because there is really very little way that our
    electronic record would be able to get the data to send out,
    much less actually perform, under MIPS.
        And besides that, I mean, just the electronic records
    themselves really do not interact with each other. I am in a
    small town of 4,000 people. I have three record systems, none
    of which actually talks to the others. And so all these things
    are making it very complicated.
        The Chairman. Okay. Dr. Opelka?
        Dr. Opelka. So very quickly, there are maybe four key
    areas. One is, create a value expression. Before you put a
    payment model on something, know what it is you are valuing. So
    what is the value expression for trauma care, for cancer care,
    for whatever kind of care you are delivering--create that value
    expression of quality over cost. So you are going to have to
    define both those key elements.
        Second is the concept of asymmetric risk. CMS is stuck on
    this concept of ``risk must be symmetric.'' People do not take
    symmetric risk. They want more upside gain than downside risk.
    It is good to have the risk and upside and downside, but
    asymmetry is how most businesses run.
        The third is a true innovation center. CMS is trying to
    take the entire elephant in one bite, and you cannot implement
    on a broad scale. It needs the ability to do small innovation
    and even tolerance for failure. They are so afraid to fail,
    they will not take the necessary chances they need to truly
    innovate. So we need to change them to a true innovation
    center.
        And last is this whole concept of data. It is not just
    EHRs. It is leveraging data, creating logical models using
    consistency, getting government standards to help us do this so
    that we can move forward.
        The Chairman. Dr. Hines?
        Dr. Hines. Thank you. I believe the best way to move the
    Medicare program toward value and away from fee-for-service is
    to promote the uptake of APMs and incentivize organizations to
    do that. That could be done through: (1) waiving the inclusion
    criteria that are in the statute that make it very difficult
    for organizations to qualify as an APM; (2) making the 5-
    percent bonus payment for Advanced APMs permanent, so that
    organizations have a predictable source of revenue to invest in
    the infrastructure, technology, and personnel necessary to
    deliver care using these new competencies; (3) timely access to
    claims data with benchmarking data on that as well, so
    organizations can see how they are doing compared to other
    similar organizations around the country; and lastly and most
    importantly, I would argue that we need to synchronize the
    rules across the various Federal ACO programs.
        Currently, the rules change based on the degree of risk
    that you are taking, and so it makes many of our member
    organizations hesitant to take increasing risk when the rules
    change as you take increasing risk. So imagine you learn to
    play baseball running from first base to second base to third
    base. And then you get to college and they throw you in the
    game and they say, ``Oh well, now we are running from third to
    second to first.'' The rules have completely changed.
        That is the way that it feels and the way that the current
    rules and regulations are around the Federal ACO program.
        The Chairman. Yes.
        Dr. Fiedler, is there anything you want to add?
        Dr. Fiedler. I would just add that I generally agree that I
    think the most promising path forward to encourage more
    efficient and higher-quality care is to build on MACRA's
    incentives for participation in Advanced APMs. I believe that
    making the bonus payment permanent, as well as strengthening
    the incentives that exist, is a promising path forward.
        The Chairman. Senator Wyden?
        Senator Wyden. Thank you very much, Mr. Chairman.
        Dr. Cullen, I am going to ask you a couple of questions
    that Robert Pear would be interested in this morning, because
    they are bipartisan, Democrats and Republicans, about good
    policy. They are about the future, and that is the whole
    chronic care area where he wrote the definitive story, where he
    said Medicare is not about acute illness, it is about chronic
    disease.
        In this committee, Democrats and Republicans--and I would
    like for members, particularly our new members, to know it was
    bipartisan every step of the way, with Senator Isakson, Senator
    Portman leading on the Republican side, caring for people at
    home, advocating for the patient; Senator Warner, who just
    walked in, advocating for people at home, then-Congressman
    Markey, now Senator. But it was always a good policy, where the
    Democrats and Republicans could agree.
        So, Dr. Cullen, I think the staffs talked to you about it.
    Tell me a little bit about your take on how we expand care for
    people at home who have these chronic illnesses, because it
    gives people more of what they want at a lesser price to the
    taxpayer. Portland has a wonderful program, House Call
    Providers.
        My first question is, the Innovation Center has recently
    announced a new Primary Care First model, which I think builds
    on some of the good work that you are doing. I have heard from
    some physicians in Oregon that they think this is a path to
    more home-based primary care.
        I would like to get the old band together again: Senator
    Grassley and I, Senators Portman, Isakson, Senator Warner,
    Senator Markey. I think you guys have some good ideas on it.
        And particularly this morning, I want to hear about people
    working together. That is what Robert Pear was mostly
    interested in. What do you think?
        Dr. Cullen. Well, I absolutely agree with you that people
    would rather be at home and that chronic care management is
    really going to be the most important way, I think, that we can
    reduce costs overall, but also just making sure that people
    remain happy.
        The Primary Care First program, actually, really does
    reward physicians for keeping people at home. And you know the
    reality is that the technologies now really allow us to do a
    lot more for people at home, and keep them at their home. And I
    can tell you that my patients would much rather not be in the
    hospital. I do home visits. As much as possible, I do try to
    keep them within their home, because that is where they feel
    most comfortable.
        I think there is a lot of interest in the seriously ill
    persons' component of Primary Care First, and that is where
    there is actually added money available to really take care of
    people who are sick and keep them in the home. So I think that
    that is--both of those are really important directions to go.
        Senator Wyden. We will hold the record open--the chairman
    has been very generous in working with us--for people to have a
    few days. I would like to see in writing any suggestions you
    all have to make the model work when it comes to home-based
    primary care, what the Center for Innovation is talking about.
    That is the first question.
        One other question, very quickly, Mr. Chairman. Dr. Cullen,
    I think you might have heard this other point I made about the
    chronic care point guard. I am just struck by how, particularly
    people who do not have Medicare Part C, for example, or
    something that coordinates their care--some of the ACOs, of
    course, do that as well--just get lost in this kind of blizzard
    of forms and paper. And as you know, the evidence shows that
    well over half of the Medicare spending is going to go for
    people who have two or more of these conditions, might have
    diabetes, cancer, or something.
        I was teasing the chairman that I want to promote the
    ``Grassley Always in Good Health Program,'' because somehow he
    and Barbara have the magic. But we have a lot of people with
    these two or more conditions.
        So I would like to get the band back together again:
    Senator Warner and Senator Markey, and the good work of
    Senators Portman and Isakson, all the members of this
    committee--through the whole chronic care debate, there was not
    one nasty, acrimonious word. People were just trying to figure
    out what the next steps were in terms of transforming Medicare.
        So, what do you think about this chronic care point guard
    and trying to move ahead with a way to help people navigate
    this byzantine system, particularly if they do not have
    Medicare Advantage or some kind of accountable care program
    that pulls it together? What do you think?
        Dr. Cullen. So family physicians see ourselves as that
    point guard.
        Senator Wyden. Good.
        Dr. Cullen. That is exactly where we have positioned
    ourselves. And I have to admit I do not play basketball, but I
    understand the concept. And we do--that is really the whole
    idea because, otherwise, when people are going from specialist
    to specialist to specialist, their care is worse and their
    costs are higher.
        We have found that with the chronic care management program
    that there are some impediments in that that probably need to
    be adjusted, because that has not fulfilled the promise that it
    has, just because it is actually very hard to make that program
    work unless you have a lot of beneficiaries.
        So in my place, we do not have very many. And so just
    getting that program up and running has been difficult because
    of the impediment.
        Senator Wyden. Well, let us do this. My time is up. I would
    like to see anything in writing that you have. We acknowledged
    from day one that that was just the beginning. And particularly
    for the well over half of the patients who are in traditional
    Medicare, the problem you described is very real, and it is
    daily.
        So give us a step-by-step, if you would, because I have
    talked to the chairman about this. And he has been very
    sympathetic to the idea, if there are some bipartisan ideas
    that are cost-effective.
        Our goal is to really go step-by-step on building what is a
    modern Medicare program, as opposed to what we had. And I would
    very much like your specific ideas on exactly the point you
    made.
        Dr. Cullen. We welcome that opportunity.
        Senator Wyden. Thanks. Thank you, Mr. Chairman.
        The Chairman. I am going to go vote. Senator Thune is going
    to lead the committee. Thune is the next one to ask questions.
    And then of the people who are here, it will be Brown and
    Warner. But if other people come back, there would be two or
    three ahead of you.
        Senator Thune [presiding]. Thank you, Mr. Chairman, Senator
    Wyden. Thanks for holding this hearing, and thanks to our
    panelists for being here today. I appreciate the opportunity to
    hear from stakeholders and how they think the shift to value-
    based care is going for their members.
        An area that has always been important to me and to my
    State is ensuring that small and rural practices have the
    opportunity to succeed in this transition. The option to form
    virtual groups under MACRA aims to help with that. While it
    took some extra time for CMS to get the program up and running,
    I hope that we will see that it offers a helpful way for
    smaller provider groups to band together and increase their
    chances of success in MIPS.
        Could our provider group panelists, perhaps Dr. Fiedler on
    the academic side of things, briefly share feedback that you
    have received from your members on how implementation of
    virtual groups has gone? Specifically, how do they identify
    fellow providers to work with, and are there any barriers to
    success at CMS that policymakers should consider? Dr. McAneny?
        Dr. McAneny. Thank you very much for that question. The AMA
    shares the disappointment that we have not had much uptake in
    virtual groups. I think one of the things that CMS could help
    us considerably with is to be more transparent about releasing
    the data.
        We have looked at doing virtual groups, with my own
    practice participating in the oncology care model, and we found
    that getting the data a year and a half later makes it
    impossible to actually see how members of that group are doing.
    So having the existing clinically integrated networks work
    together and become some of these pooled groups would be very
    helpful. But we think that there are a lot of infrastructure
    costs that need to be done. So starting with groups that are
    already doing some of that may be helpful.
        One of the concerns that physician practices have in trying
    to integrate with independent practices working together as a
    virtual group is the Stark and anti-kickback laws. We do not
    want to run afoul of those. Yet if we are going to be able to
    conserve resources, we want to be able to work together to
    create processes to have, say, the ancillary services part of
    the virtual group so that they cost less than if we send people
    to the local hospital to get a CT scan or something like that.
    The additional incentives and bonus payments that could be
    provided to help with the increased communication and
    coordination costs across a virtual group would be very useful.
        Thank you.
        Senator Thune. Thank you. Anybody else? Dr. Cullen?
        Dr. Cullen. There was a lot of excitement about the program
    when it was first brought up. I have to say though that it has
    really proven to be very difficult to form these groups. And
    there is--I have not really seen a lot of interest among my
    fellow family physicians, even though, especially for rural
    physicians, this would be a great program.
        I think that there probably needs to be a little bit more
    advertising or communication about them. But there is also a
    lack of multi-payer agreement on what that actually means as
    well.
        Senator Thune. So a year ago, CMS announced its rural
    health strategy with a stated goal of applying a rural lens to
    CMS programs and policies. CMS's willingness to acknowledge
    this issue presents a great opportunity to talk about the
    flexibility that rural providers need in order to overcome the
    challenges associated with taking on risks and implementing
    technology while managing an older and smaller population.
        So, aside from virtual groups, what other suggestions have
    your providers offered in terms of how we can help ensure that
    success of rural providers in delivery system reform?
        Dr. Cullen. Well, first off, I think that paying them more
    would probably be helpful. And I say that because already there
    are many rural practices that are right at the very edge of
    survival, and part of that is because of really the higher
    overhead that is associated with having a small rural practice,
    just because of the cost of actually running a practice.
        And the second is just the complexity of the patients that
    we take care of and the difficulty with referrals, and with
    just being able to afford the IT infrastructure because we do
    not have somebody in town who is able to actually work on that,
    those systems. So I think that if you want rural providers to
    stay in business, I think paying them more is probably the best
    way to do that.
        Secondly, I think reducing the complexity is really
    important. I think that is what we have already been talking
    about with MIPS. But the systems that most rural providers are
    able to afford really are not able to provide the data that we
    can then pass on to CMS. And besides that, a lot of times our
    systems do not communicate with other systems in those
    communities. Like I said, I actually have three different
    systems that do not talk to each other, and they are all
    located in the same building in our community.
        Senator Thune. Anybody else on that? Yes, Doctor?
        Dr. McAneny. Thank you very much. I would like to add to
    that that preserving the small threshold, the small volume
    exemption, would be very helpful because, if you think about
    those physicians and those practices that qualify for that,
    they are treating less than 200 Medicare patients. That is four
    a week.
        So to a previous point that was made, even if you penalized
    all of those physicians by making them participate when they
    cannot make the scores because of all the problems Dr. Cullen
    mentioned, you would not produce very much money to put into
    this pool to give to the ones that are hitting higher scores.
    So, preserve that exception and make that available.
        The second thing is the update. Having a positive update is
    so important, because we know that the cost of providing
    medical practice increases between 2\1/2\ and 3\1/2\ percent
    every year. Yet we are heading into a process where Medicare
    will give us a zero-
    percent increase every year. And that simply is not a
    sustainable thing. And the rural practices will be the first to
    feel that problem.
        It is not just primary care. In my oncology practice, we
    have closed several rural clinics for exactly those reasons:
    that we cannot make ends meet because it actually costs more to
    deliver care per patient in a rural area where you have a
    smaller volume.
        Senator Thune. Thank you.
        Senator Brown?
        Senator Brown. Thank you, Senator Thune. And thanks to our
    Senators Wyden and Grassley for this hearing. Thanks so much
    for your testimony and answering questions.
        As you know, we passed MACRA to reward high-value patient-
    centered care. While MACRA is about physician payment reform,
    to be sure, our goal should be maximizing patient benefit. I
    know all of you, from your comments, agree with that.
        It is clear we have not done enough to ensure that
    patients' voices are a part of the process and that patients
    are benefiting from these changes. NIH created the Patient-
    Focused Therapy Development tools and systems dedicated to
    engaging patients throughout the translational science process.
    FDA has implemented a Patient-Focused Drug Development model to
    help ensure that patients' experiences and perspectives and
    needs and priorities are captured meaningfully during drug
    development and review. My question is for you, Dr. McAneny.
        Two questions: do you believe CMS and Congress are doing
    enough to ensure representation of the patient voice throughout
    the development and the implementation of MACRA, first
    question? And second, what more can your physician
    organizations and CMS do to ensure that patient needs and
    priorities are kept at the center of health-care delivery? If
    you would try to answer those together, thank you.
        Dr. McAneny. Thank you, Senator Brown.
        It is a difficult method to try to collect patient-reported
    outcomes because patients who are sick are too busy being sick.
    I am a cancer doctor. They do not have the energy to fill out
    forms. And for example, in the oncology care model, they send
    out an 84-question document that patients are supposed to fill
    out, which they do not.
        So what we have found works better and what the AMA has
    been proposing with this is to make sure that the patient
    advocacy organizations are heard--and we talk to them and
    convene them in multiple of our sessions--but also to recognize
    what patients need through examples like the patient-centered
    medical home.
        We did this in oncology, and our patient satisfaction
    scores were in the high 90-percent range because you give
    patients the help they need when they need it at the lower cost
    side of service. And in addition, we saved about $2,100 a
    patient, which was pretty good.
        So it is possible to do that, and by incorporating what
    patients want and patients need and their values into this, you
    can direct their care and avoid care they do not particularly
    want. And we continue to work more with that.
        One of the ways that we are trying very hard to involve
    patients from the AMA standpoint is to recognize that there are
    a huge number of Americans who have pre-diabetes and do not
    even know about it, and have other chronic diseases that are
    not well managed, and we recognize that that takes a team of
    people to work on those. So we are focusing on diabetes, pre-
    diabetes, and hypertension to try to look at the chronic
    diseases that Americans have said they wanted treatment for.
        We also continue to work for access to care, because what
    we hear from patients is, this is the most important thing for
    them, to have continued access to care.
        Senator Brown. Thank you.
        Dr. Cullen and Dr. Opelka, I will ask you a question
    jointly as my last question. In each of your testimonies you
    mentioned the importance of patient-reported outcomes. We
    obviously should be measuring whether or not we are paying for
    care that is in line with the patient's goals. If you could
    comment, how many of the existing 424 measures in MIPS consider
    the patient voice in their priorities? Dr. Cullen and Dr.
    Opelka?
        Dr. Cullen. I am actually not sure I can answer that. But
    there is a saying in family medicine that it is not patient-
    centered until the patients say it is.
        Dr. Opelka. In the surgical space, we do not have any. We,
    ourselves, run our own patient-reported outcomes within our
    database to inform our members. But they are not part of the
    payment program.
        Senator Brown. Okay. Thank you. Thanks, Mr. Chairman.
        Senator Thune. Thank you, Senator Brown.
        Senator Roberts?
        Senator Roberts. Well thank you, Mr. Chairman.
        I would like to echo the sentiment shared by many of our
    witnesses this morning that, while MACRA is not without its
    challenges, it certainly was an improvement over the
    sustainable growth rate payment system and the many doc fixes
    passed by Congress over the years.
        I remember, personally, we would promise the docs and
    everybody else involved in the rural health care delivery
    system, and for that matter, the State of Kansas, ``Yes, we
    will fix it.'' And each month would go by, and finally at the
    11th hour and the 59th minute, we would come up with
    something--never enough, never enough. I never understood why
    we could not do that the first thing in the Congress so we had
    a better system.
        MACRA was a significant step toward improving quality for
    providers and, more importantly, patients going forward. But I
    have several concerns about how the law affects small and rural
    practices. I know that has been emphasized by most of you.
        The Merit-based Incentive Payment System, MIPS, is set up
    to rate providers based on requirements that are often simply
    too burdensome for these practices. And that is probably an
    understatement. These providers already face higher expenses
    and limited resources and lower patient volume, which is often
    not adequately reflected in MIPS. I appreciate the actions that
    have been taken to offer these practices exemption and
    flexibilities from MIPS. However, much more work needs to be
    done in order to make meaningful improvements for these
    providers and their patients.
        It is terribly important to ensure they are not
    overburdened. We should now also aim to incorporate small and
    rural providers and their quality improvement systems by
    accounting for the unique challenges they face. Both providers
    and their patients deserve to be included in Federal efforts to
    improve health-care quality without being penalized by these
    programs simply because of the geography or size of the
    practice.
        As co-chair of the Senate Rural Health Care Caucus, I,
    along with my colleagues on the caucus, sent a letter to the
    National Quality Forum in 2016, back then, requesting that the
    NQF convene a rural Measures Application Partnership--the
    acronym for that is MAP--to develop quality measures that are
    relevant to these rural practices. I was very pleased in August
    when the rural MAP published the first-ever set of rural-
    relevant quality measures. But I believe, while this is an
    important step, including all providers into quality programs
    in a way that is both meaningful and appropriate would be the
    best course.
        Dr. McAneny, you have a situation in Iowa. I hope you are
    not underwater where you live, and I hope you can get through
    all of that. We are waiting for that in Kansas. But you
    mentioned in your testimony that rural and small practices, in
    particularly our very small rural communities, tend to have
    lower MIPS scores compared to the national average. How would
    more appropriate quality measures help level the playing field?
    Would other improvements beyond changes to quality reporting be
    necessary? As a tip-off, I think that answer is ``yes.''
        Dr. McAneny. Thank you very much, Senator.
        And I am actually in New Mexico, and we would love to have
    some of that extra water from Iowa. As we look at the very
    specific issues that affect rural patients, what we find is,
    because they have less discretionary income often, we fall into
    the category of the social determinants of health. And holding
    physicians accountable for those social determinants makes
    things incredibly difficult. I know it from my own practice,
    which is rural, that we end up with patients whose outcomes are
    very much affected by food insecurity, by transportation
    issues, and other things that we are not currently allowed to
    help solve.
        If we try to provide transportation through the practices
    to get to care, for example, we are at risk of being guilty of
    inurement and offering something of value. So releasing some of
    the laws that constrain us from being able to band together
    with other rural practices to be able to provide these services
    for patients would be very, very useful.
        Having rural practices, small practices like mine, work to
    try to put the data in for MIPS takes a huge amount of time and
    effort. I decided as AMA president that I would set an example
    for everyone and prove that a rural practice could do this. I
    scored 100 on MIPS. My increase was 1.88 percent. And after the
    adjustment that occurred after that, it lowered that increase
    to where the entire change that I got was $34,000.
        When I added up how much I had to pay my EMR vendor to
    submit that data, when I had added up everything that I had to
    do in terms of paying staff overtime to make sure the data was
    accurate, I lost $100,000 to score that perfect score. So we
    need to modify that. That is, I think, a great example of why
    the lower-volume practices need to be kept out of this process
    so they can continue to use their resources on patient care.
        And we need to streamline this entire process so that we
    can submit the data, hold ourselves accountable for delivering
    the quality of care that our patients deserve, but do it at a
    lower price tag.
        Senator Roberts. Thank you.
        My time has run out, Mr. Chairman. I would only point out
    that when you score 100, it is like all of a sudden the
    referees, the people who wear the stripes in the basketball
    game saying, ``I am sorry. You only scored 80, and you lost the
    game.''
        Dr. McAneny. I lost.
        Senator Roberts. I yield back.
        Senator Thune. Always very perceptive and insightful----
        Senator Roberts. Thank you.
        Senator Thune. Senator Warner?
        Senator Warner. Thank you, Senator Thune. And I guess that
    would be one way to describe Senator Roberts.
        Thank you all for being here. And I think as you heard from
    the chairman and the ranking member and all of our questions,
    this is actually an area where I think we all agree. It feels
    like, while well-intentioned, we may not be getting the results
    we are looking for. I have a lot of small rural providers as
    well.
        I have three questions I want to try to get to, and I
    recognize that we have focused on only part of the panel. I
    think I will start with you, Dr. Cullen.
        You know, I am interested in the Physician-Focused Payment
    Model Technical Advisory Committee, PTAC. It seems like they
    have done some good work. I have been particularly interested
    in some of these physician payment systems, particularly around
    advanced directive, end-of-life, advanced care models.
        It seems like while--again, well-intentioned--CMS has not
    been very good about actually implementing these models. What
    can we do, or is this where we should--do we need legislative
    change here? Do we need haranguing on CMS? I would love to
    hear, again, any of your suggestions. And if we could fairly
    quickly, since I have a couple other questions.
        Dr. Cullen. The big problem with the Advanced Alternative
    Payment Models is that they have taken a really long time to
    roll out. That has not really been the fault of PTAC, because
    we had ours approved back in 2017. Somehow in that process,
    getting it actually rolled out has proven difficult and much
    longer than we expected.
        Dr. McAneny. I would like to add that having the CMMI able
    to do pilot projects might be very useful. And yes, they
    evaluate a lot of good programs that have been submitted to
    them. But if we can get some of the pilots enacted, that would
    be very helpful.
        Dr. Opelka. The PTAC is going through an enormous amount of
    work in the conceptual modeling, and it is fantastic. It then
    fails when it gets to the Innovation Center because it is
    trying to do broad-scale innovation rather than narrowing it
    down. Let us test it. Let us see if we can do this
    implementation.
        And how do we partner? There is really--it goes inside the
    government, and it gets lost in a big swallow. It needs to
    actually be much more nimble if it is truly going to be
    innovative, and it cannot be afraid to fail, and then modify,
    and change, and grow.
        There is a lot of, ``Oh, we just cannot fail with this
    because we are trying to do a big implementation.''
        Senator Warner. It seems, though, that this might be an
    area where you do not necessarily need a legislative change,
    but maybe a group of us from the committee to kind of put the
    pressure on CMS to say, ``We gave you these tools.'' We need to
    try and recognize, and maybe get us on record as saying, ``Try,
    and we realize you may have some failures.'' And if we are then
    on record, then we cannot complain when the failures come back.
    But I think, as a former venture capitalist, you have to have
    that mind-set.
        Dr. Fiedler, on the merit-based incentive program, in your
    testimony you said, ``Let us just eliminate it.'' I am
    reluctant to think that--I know it has been not appropriately
    implemented. But is there--are you fully in that it is not
    worth trying to reform, re-tweak? Do you think elimination is
    the only option?
        Dr. Fiedler. So, I am not optimistic about what can be
    achieved through reform. But I do think there are options to
    improve on the status quo. I think there are improvements we
    can make in the quality domain to ensure that clinicians are
    not incentivized just to select the measures that they think
    they are going to be able to get the highest score on, rather
    than the ones that are most meaningful to their patients.
        I think there are opportunities to simplify the Promoting
    Interoperability category to get what the public--what we sort
    of want out of that category, which is greater take-up and
    anchoring of the certified EHR standards, not a box-checking
    exercise about, you know, are you using the record in this
    particular way that CMS thinks you should?
        And I think we can improve the practice improvement
    category by transforming it into a targeted incentive for
    specific high-value activities, rather than the sort of grab
    bag of 100 activities we have today.
        Senator Warner. I would love to see--perhaps in a written
    response--some of those ideas laid out.
        Let me lay out one last question. I am probably not going
    to get a chance to get all of you to respond. But for the
    record, you know--I failed to mention interoperability.
        I was a telecom guy before I was in politics, and we should
    have seen this train coming in terms of the need for
    interoperability and all of the promise that we so over-
    promised on EMRs--and so under-delivered, I think a lot because
    of the lack of interoperability.
        But on a broader basis, everything--so much we are talking
    about in terms of pricing and some of your comments already
    about the requirements to try to get all this data, we are
    going to move towards a more data-centric system.
        But wearing my other intel hat, we are seeing enormous
    vulnerabilities coming from cyber. And I have put out, in a
    sense, a request for ideas and proposals across the health-care
    field. And huge uptake--and Senator Thune plays a leadership
    role on this on the Commerce Committee--huge, huge uptake, but
    the vulnerabilities we have seen, we are already starting to
    see with some of the ransomware against hospitals. But the
    ability to hack into individual docs' systems and others, I
    would hope that you could all come back to me with your
    perspectives on how we continue to take full advantage of this
    data-rich environment, but also not repeat the failure on EMR
    by not having interoperability.
        We may repeat the same if we do not build in basic
    cybersecurity hygiene and standards as we continue to
    accumulate this data. And I just think it is a huge
    vulnerability.
        I know I am over time, so I do not want to--I am over time.
    So maybe you could answer Dr. Cassidy on part of that question.
        Thank you, Senator Thune.
        Senator Thune. Thank you, Senator Warner.
        Senator Cassidy?
        Senator Cassidy. Thank you very much.
        First, I do not want to be pedantic--Dr. McAneny, it is
    nice to see you. I do not want to be pedantic, but let me just
    point out that in your testimony you speak about these small
    practice MIPS having a mean score of 75, but a median of 63. It
    tells me that some practices do very well. It is just that most
    practices do not--that kind of difference between mean and
    median.
        Now I raise that, again not to be pedantic, but are folks
    familiar with the direct contracting model options that were
    released? Dr. Cullen, you would be.
        And so let me just--as quick background, when I was on
    Energy and Commerce on the House side, Mike Burgess and I had
    this concept that small independent practices--small practices
    within an independent practice association--could go to a two-
    sided risk directly contracting with CMS.
        Now if we focus on outcomes, not upon measures--so that is
    the good thing about it. And the reason I kind of develop it
    all this way is that Dr. Hines points out that MIPS excludes
    small practices. You make the case that it is probably
    necessary because of increased cost of compliance. But when I
    look at that difference between mean and median, it looks as if
    small practices can do it, it is just that a lot do, but just a
    lot more do not.
        So having said that, Dr. Cullen, to what degree do you
    think that small practices can participate in this direct
    contract model? And do you think this would be a way to
    incentivize that smaller practice to go into a two-sided risk
    arrangement where hopefully they benefit from the upside?
        Dr. Cullen. First off, I am excited to try it because it
    has rolled out in--Alaska is one of the pilot States under
    Primary Care First. So I will be able to tell you a little bit
    more, maybe in a year.
        One thing about the two-sided risk is that I do agree that
    we need to make the downside risk fairly minimal. And I say
    that because, again, a lot of practices in rural areas and
    small practices are really right at the margin at this point.
        And so, if it is a large two-sided risk----
        Senator Cassidy. Now, let me stop you for a second. There
    is a group of physician-run MA plans, and their physicians do
    better financially. They actually have smaller panels than does
    the regular Medicare-focused practice.
        And the guy who runs it says, ``I just go to a small
    practice and I say, `Was there one patient who you hospitalized
    last week that you did not have to?' `Oh yes, I could have
    brought them here instead of the ER, but I was just slammed.'
    ''
        If you had not admitted that patient, you would keep the
    savings. So I say that knowing that there are some tight
    margins, but that there are practice decisions that we can make
    as practicing physicians that can lower costs with the benefit
    accruing to us. Would you agree with that?
        Dr. Cullen. Absolutely.
        Senator Cassidy. So it would increase those margins.
        Dr. Hines, any thoughts on all this?
        Dr. Hines. Yes, thank you. I just want to point out,
    because it has been brought up a few times, about small
    practices and MIPS--and I think Dr. McAneny's example of
    scoring 100 is a good example of why we should do away with the
    exclusions and be able to have the funds to be able to reward
    the practices that are doing a good job.
        And let us not forget that there is funding in MIPS for the
    small uninsured and rural support initiative to help these
    smaller practices be able to report on quality and be able to
    have the help that they need. And MIPS is really an on-ramp
    towards value.
        And AMGA's position on this is that we should be expanding
    this so that more and more providers are able to----
        Senator Cassidy. Because I have limited time, can I get you
    back to what I was asking: this direct contracting model in
    which IPAs could go at risk?
        Dr. Hines. So I think that it, in theory, is a great model.
    I think the devil is in the details. This idea of having a per-
    capita reimbursement but having patients have total choice of
    care and be able to go anywhere they want----
        Senator Cassidy. It could be a prospective assignment as in
    an MA. It would not be an ACO where, after the fact you decide
    where people got their care. It would be a, no, you are going
    to be my doctor sort of thing.
        Dr. Hines. And I think as long as there are those
    assurances in there, and that there are some limits to the
    network so that you can promote patients to go to physicians
    who have been shown to be high-quality and low-cost, I think it
    has the potential to be successful, yes.
        Senator Cassidy. Dr. McAneny, any comments?
        Dr. McAneny. Yes; thank you for that question.
        First of all, I think that having the prospective payment
    is key, because my practice had the $100,000 to invest to get
    that perfect score, but many small practices do not have that
    resource. And going through the process to get technical
    assistance does not substitute for that. So having a
    prospective payment come out first is great. I also think this
    is a great opportunity for us to do a test for this and see.
        I think we need to scale risk according to what the
    practice can manage. If you are a small practice, promising a
    job to another nurse, a salary with benefits, is a significant
    financial risk. So I think we need to look at that very
    carefully. We do not want to put so much risk on a practice
    that if they do not succeed, we lose the interest----
        Senator Cassidy. I accept that. I am out of time.
        I will make a comment, though. Going back to this
    physician-run MA plan, the paradigm has always been, see as
    many patients as you can to cover your overhead.
        This is a different paradigm: actually give higher-value
    care, and your margins actually rise, even though you see fewer
    patients. And I do think that there is going to be an emotional
    and intellectual adjustment.
        We are out of time, and I will give it back to the
    chairman.
        The Chairman. Senator Whitehouse?
        Senator Whitehouse. Thank you. First, let me thank the
    chairman for having this important hearing. And let me say how
    glad I am that Senator Cassidy is here while I have the chance
    to ask my questions, because we have worked well together in
    this area, and I hope to continue.
        I am going to ask you to answer these questions in writing
    if you care to, because they are fairly complicated. Consider
    them an invitation.
        Before I ask the questions, I just want to make one
    observation, which is that CBO does rolling projections of what
    the total Federal health-care spend is going to be. And their
    most recent projection is down over $4 trillion over 10 years
    from what it was projected to be 10 years ago. So something big
    is happening out there. We do not understand what it is. But $4
    trillion is a lot of money to project in savings.
        So here are my questions. The first has to do with ACOs.
    Rhode Island has two of the best provider ACOs in the country,
    Coastal Medical and Integra. They are doing very well.
        CMS has not always been their best friend. There have been
    a variety of efforts at CMS that frankly would have been very
    damaging to the ACOs. My view is that you feed the lead dogs.
    They should feel rewarded and supported. And very often they
    feel challenged and almost unwelcome. You also invest a little
    bit more than you do in the final product in a prototype. So
    for a whole bunch of reasons, I think we reward the really good
    performers and figure out what they did, and figure out how you
    propagate; that is a better strategy than trying to extract as
    much savings from each one as you can at this early stage while
    we are still developing the prototype.
        One of the problems that the ACOs face is a leveraging
    problem. If they are going to bear risk, they bear risk on the
    entire cost load of their patients. But they only control 10 to
    15 percent of their patient cost. The rest is specialists,
    pharmaceuticals, hospitals--people over whom a provider ACO has
    no control.
        So I think that is something we need to try to figure out:
    how you prevent them from having to not take risk because they
    feel so leveraged. So that was question one, supporting
    provider ACOs, feeding the lead dogs. What can we do better?
        The second has to do with end-of-life care. Whether you
    call it ``end-of-life'' or ``advanced care'' or ``palliative
    care'' or whatever, there is a space in there where--with
    respect to Dr. Opelka's comment that we need microcosms for
    innovation to sort of test the innovation model and move
    forward--I think that ought to be one.
        There is a big group called C-TAC, Coalition to Transform
    Advanced Care, that is working in this space. And I think that
    there is a space there where some of the Medicaid rules, if you
    are actually dealing with this population as a population,
    become counterproductive. And Adam Boehler is being helpful in
    trying to solve that problem, but it would be helpful to have
    your thoughts as well about this population.
        It is the ``2-night, 3-day'' rule. It is the ``patient in
    the hospital for respite care'' rule. It is the ``you cannot
    get home care services unless you are homebound'' rule. There
    are a whole bunch of things that, perhaps in the abstract, make
    sense, but do not once you start managing this population.
        Third, the electronic health record/health information
    exchange interface for doctors. Senator Cassidy and I just had
    to file a bill. We did not need to get it passed to get some of
    these EHR providers to change their behavior about the gag
    rule. So I think there is actually the prospect for pretty
    strong bipartisan signaling out of this committee where there
    are problem areas.
        I think we all understand that the business model of some
    of these providers--not the medical providers, the data
    services--is to try to encourage people to adopt their own
    program by being less interoperable than they should be. They
    actually have a counter-incentive to the interoperability that
    will serve patients. And we need to figure out how to fight our
    way through that.
        Last question, or last point for your response, is that it
    strikes me that one of the areas we have not engaged in very
    effectively yet is at the State level. There was an effort at
    one point by CMS to go and try to impose programs by its
    regions. Nobody cares about its regions. There is nothing real
    about its regions.
        What is real are States. They have Governors. They have
    medical associations. They have health departments. They have
    Medicaid programs. And if we could work together to figure out
    a way to reward States for better outcomes, as well as
    individual practices, I think all of that State-based machinery
    can then be put to work to help solve these problems.
        At this point, other than the Medicaid programs trying to
    reduce cost, I do not think we have engaged the States at that
    level. So if you were to do a Medicare penalty for States that
    are outliers in terms of quality versus cost, I think the
    Governor, the head of the medical society, the health director,
    and the Medicaid program director would all be in the room the
    next day saying, ``How do we avoid this?'' And we need to
    provoke that kind of activity at the State level.
        So those are all for responses in writing. I hope this is a
    healthy dialogue, and I think there is a lot of bipartisan
    interest.
        And thank you, Mr. Chairman, for having this hearing.
        The Chairman. Yes.
        If Senator Hassan is ready--if you are ready, you are up
    next. If you are not ready, I have one question, but I think--
    --
        Senator Hassan. Why don't you ask your question, and then I
    would be happy----
        The Chairman. Okay. For any or all of you--but do not take
    a lot of time away from Senator Hassan to get too deeply into
    this--I take special interest in making sure that there are
    physicians to care for people in my rural areas, and there are
    a lot of rural areas more rural than Iowa. But we have plenty
    of them.
        And rural physicians should have an opportunity to
    participate in the Alternative Payment Models. What can be done
    to create such Alternative Payment Model opportunities and give
    physicians in rural areas the best chance to succeed in them?
        Dr. McAneny. Thank you very much. I think the MIPS program
    is a way to start with that, with MIPS Advanced APMs. The
    medical home can be done by very small practices. It is not at
    this point a payment model, but it is a MIPS APM. And so that
    is very useful.
        We are hoping that some of these pooled processes may work
    for that. But the first step has to be to give those practices
    the resources to be able to have the time and flexibility to
    innovate. And that means that will not happen if we have a
    zero-percent update for the next several years for those
    practices that are still in MIPS. It is a process, and they
    cannot stop taking care of the patients of today to think about
    how they are going to manage the patients of tomorrow, and in
    an alternative method.
        We promote the PTAC idea of starting out with, how do you
    want to deliver the care, and then adapting the payment model
    to fit that, instead of the current method of creating a
    payment model and then telling the physicians to adapt their
    practices to that.
        The Chairman. I am just going to hear from Dr. Cullen and
    then go to Senator Hassan--since you are in a rural area.
        Dr. Cullen. Well, the American Academy of Family
    Physicians' Alternative Payment Model I think is really going
    to work in a rural situation. That is something that I have
    been watching really closely, given my situation. But as a
    prospective payment with significant upside risk, I think that
    that is something that will help significantly in rural
    practice.
        The Chairman. Okay.
        Senator Hassan?
        Senator Hassan. Well, thank you very much, Mr. Chairman,
    and thanks to you and the ranking member for having this
    hearing. And to the panel, thank you for your testimony. And to
    say that the Senate's voting practice this morning is
    disruptive is an understatement. So I appreciate your patience
    with that.
        Dr. Cullen, I wanted to just start by following up on what
    I think has been a little bit of your earlier testimony. New
    Hampshire also has its share of rural hospitals, and I am very
    interested in a number of the issues that you have talked
    about.
        But could you speak a little bit more to the specific
    challenges that rural hospitals and providers face complying
    with these reporting requirements, and talk a little bit more
    about how it impacts patient care in rural communities?
        Dr. Cullen. Well, the biggest impact is if the hospital or
    the providers close or leave.
        Senator Hassan. Right.
        Dr. Cullen. And unfortunately, we have lost almost 100
    small rural hospitals in this country in the last 10 years,
    which has had a huge impact on maternal and infant mortality
    and other factors. So this is an enormous impact.
        Senator Hassan. Right.
        Dr. Cullen. As far as why, a lot of it has to do with the
    ability to do the reporting. We just do not have the
    sophisticated systems that allow us to do the reporting or an
    easy way to do that. And part of that is because of the costs
    that are incurred just in buying those systems.
        Part of it is just the support. And then the third thing is
    that oftentimes I see that there is an idea that things are
    easier in rural communities and that they are cheaper. And it
    is just the opposite.
        We take care of a whole range. In my community, we do full
    spectrum OB, which means we deliver babies, we do C-sections,
    we do surgery, we cover the ER; the pace is very intense. But
    being able to find the pool of people to work in the clinic or
    in the hospital is also extremely difficult. And so all of
    those raise costs dramatically.
        Senator Hassan. Okay. Thank you.
        I wanted to ask each of you to comment, if you could, on an
    issue that, again, is near and dear to my State, which is the
    opioid epidemic. MACRA provides an incentive payment for
    providers who improve their tracking and reporting of quality
    measures related to opioid prescribing, treatment agreements,
    follow-up evaluations, and screening of patients who may be at
    risk of opioid misuse.
        The question that I have is for anyone of you who might
    have insight into the issue of substance use disorders.
    Specifically, have these new reporting requirements had an
    impact on reducing opioid misuse, and are there ways we could
    improve the collection and use of this data being reported in
    order to have a greater impact? Anybody want to--Doctor?
        Dr. Cullen. Our clinic does provide medical assisted
    treatment. We do a fair amount of work with the opioid use
    disorder. We would be doing that regardless of the MIPS
    measures, frankly. And that is just our task.
        As far as capturing the data, I think the hard thing is
    that--again, this is an area where it is very hard to distill
    that down to individual data points, because opioid treatment
    disorder is something that really requires a full-court press
    with counseling, physical therapy--we actually use acupuncture
    as well as medication-assisted treatment.
        Senator Hassan. Right.
        Dr. Cullen. It is something that is very labor-intensive.
        Senator Hassan. Thank you. Yes, Doctor?
        Dr. McAneny. Yes, from the AMA standpoint, we have had an
    opioid taskforce looking at this for many years now, since
    2014, because we recognize this. And we have done a lot of
    educational processes that have decreased the amount of
    prescriptions only to see patients then shift to street drugs
    to get their medications that they want.
        Having the opioid use treatment processes as a quality
    measure in MIPS so that people can score for that would be, I
    think, a helpful process for that, and having the prescription
    drug monitoring programs more user-friendly, and also
    recognizing team-based care as opposed to one-physician one-
    patient all the time.
        Senator Hassan. Right.
        Dr. McAneny. That is not how we practice anymore. It would
    be very useful along those lines. And having the processes in
    place so that there are more options for treating people who
    have opioid use disorder--many communities, particularly, are
    severely impacted. Rural communities do not have anyone who can
    help with that disorder. It needs a full-court press.
        Senator Hassan. Thank you.
        Dr. Hines?
        Dr. Hines. Yes, I would just add that the opioid epidemic,
    I think, is an area where the model of care that is promoted by
    AMGA can be quite successful, because we are all about
    coordinated, integrated care. And as has been mentioned
    already, in order to treat opioid addiction, just like in order
    to treat chronic diseases, you need to make sure that you have
    the full spectrum of services available for patients. And it is
    often helpful to do that in one place.
        So I think that having measures around opioid use can be
    helpful, but I think it is more just the calling of physicians
    to realize that this is a problem, and the best way to treat
    that is in an integrated, multidisciplinary way.
        Senator Hassan. Thank you. Thank you all very much, again,
    for your testimony, and for your expertise and work.
        Senator Roberts [presiding]. Senator Carper?
        Senator Carper. We apologize for this--the way things are
    being conducted. When Senator Roberts and I are in charge of
    this place, this will not happen. [Laughter.]
        So thanks for bearing with us.
        But thank you for being here. Thanks for your testimony and
    responding to our questions.
        I am interested in hearing about roughly how many
    physicians and health-care providers participate in Medicare,
    but I do not know if you all have any idea about that. Any
    thoughts on that? How many physicians and health-care providers
    actually do participate in Medicare? Anybody want to venture a
    guess?
        Dr. McAneny. I can get you the exact numbers of people who
    do participate in----
        Senator Carper. Can you give me their names and addresses?
    [Laughter.]
        Dr. McAneny. CMS is supposed to have that registry.
        Senator Carper. Okay. Well, we will ask them.
        Dr. McAneny. But I think that the vast majority of
    physicians do, which is always an interesting thing given that
    Medicare does not pay for the full cost of care. It is just
    that as physicians, when you are taking care of a patient, they
    age into Medicare, or your colleague asks you to see a new
    patient who is on Medicare. You think, this is a patient who
    needs me, not, is this patient going to pay their own way,
    because we know that they do not under Medicare.
        Senator Carper. All right.
        Yes? Is it Cullen or Cullens?
        Dr. Cullen. Cullen, thank you.
        Senator Carper. Hi, Dr. Cullen.
        Dr. Cullen. Family physicians, and it is well over 90
    percent, accept Medicare patients.
        Senator Carper. All right. Thank you.
        All right. Anybody else have anything else?
        Dr. Hines. I believe the number is 1.5 million physicians.
        Senator Carper. All right. Thank you. Are you rounding?
    [Laughter.] Okay. All right.
        A follow-up question: what can we on this side of the dais
    be doing in Congress to increase the number of physicians who
    are participating in these Alternative Payment Models, maybe
    more quickly and perhaps even more effectively?
        Dr. Hines. Sure. Maybe I can start with that.
        So I think the best way to do that is to promote APMs. I
    think that the APMS are the best way to move the health-care
    system toward value and away from a fee-for-service system that
    really incentivizes transactional-based care.
        And in order to promote APMs, we need to eliminate the
    thresholds that are preventing many groups from being able to
    become APMs. We need to make the 5-percent Advanced APM bonus
    permanent so that groups have the dependable revenue to be able
    to invest in the personnel, resources, and technology to
    succeed under value, such as the chronic care point guard that
    Senator Wyden was mentioning.
        And also, we need to make sure that we synchronize the
    rules across all of the different ACO programs so that when
    folks learn how to take risk on an upside-only program, those
    same rules apply to the downside risk as well, so you are not
    learning under one set of rules and then performing under
    another.
        Senator Carper. I am not going to ask everybody to go--
    anybody agree with anything that he just said?
        Go ahead, Dr. Cullen.
        Dr. Cullen. I think the other thing is that it would be
    better to roll out these programs more quickly and also have
    them available in more geographic areas. One of the problems
    with the rollouts in the past is that they have been actually
    very small areas, and so large parts of the country have not
    been able to take part in any kind of APM, much less an
    Advanced Alternative Payment Model.
        I think that if we could rapidly ramp up those and expand
    them to more geographic areas, that would be useful.
        Senator Carper. Thank you. I appreciate it.
        Dr. Opelka. So thank you very much. For us--as the American
    College of Surgeons--when we look at this, we have been trying
    to actually fit something into a payment model. And what we
    really need to do is define the value of care we want--trauma
    care or cancer care--and then for that value of care, what are
    the elements that we need to afford it? And then, how do we put
    that into a risk model that has asymmetric risks, where there
    is more incentive to take the risk and there is less risk that
    you will go bankrupt if you take that risk? But you need upside
    and downside risk.
        Senator Carper. One last quick question, and that is, what
    Alternative Payment Models are best suited for improving end-
    of-life care and treatment for opioid addictions? Any thoughts?
        Dr. Hines. So, perhaps on the end-of-life care, Crystal Run
    Healthcare is involved in the oncology care model. And one of
    the things that we have learned in that model is that we are
    significantly underutilizing end-of-life care.
        And we have really put together a team of experts within
    our organization to have those difficult conversations earlier,
    so that less futile care is provided and less patients are
    dying in ICUs, but rather dying at home with their family
    around them.
        And it is really an opportunity to participate in these
    programs that allows you to see what your data is around that
    and how you can do a better job for your patients and your
    population.
        Senator Carper. Dr. Cullen again--go ahead, ma'am.
        Dr. McAneny. Thank you. I am a medical oncologist, and I am
    participating in that. We also have an oncology medical home
    process as an Innovation Center award. And what we found was
    that, when patients know that you are there for them all the
    way through the course of their illness, and you have that
    continuity of care--and basically oncologists function as the
    primary care doctor for the subset of patients with cancer--
    then they trust us.
        And as a byproduct of saving money by keeping them out of
    the hospital and offering those things, we saved a significant
    amount of money on end-of-life care because of the trust and
    the relationship that was established. So I think that is a
    very important part.
        The opioid issue, you know, to have that requires an entire
    team-based effort as well, and I think that is part of the new
    primary care models that are coming out. I will defer that to
    Dr. Cullen.
        Senator Carper. All right. Thanks.
        Dr. Cullen, my time has expired. I am going to ask you to
    respond for the record, if you would.
        And thank you all very much for being here and for your
    testimony. Thanks.
        Senator Wyden [presiding]. Okay.
        I have a question, and then I want to make sure that all
    the bipartisan staff are acceptable with our wrapping up.
        Apropos of rural areas--and this has been a great interest
    of the chairman, of myself, of many Republicans and many
    Democrats. We have a question about how these rural areas are
    going to fit with respect to innovative payment models. In
    other words, everybody talks about them. This is practically a
    gospel of health-care policy. You have a lot of Senators here,
    as I said, both sides of the aisle, who care deeply about small
    practices, rural areas, underserved areas, and we are trying to
    figure out how they are going to fit in this brave new world.
        So I am going to allow any of you to comment on it. And
    then I would like to ask the staffs on both the Democratic side
    and Republican staff to make sure that they are okay after this
    with their members wrapping up, okay?
        Yes, Dr. Cullen?
        Dr. Cullen. So I think the most important thing is making
    sure that these Alternative Payment Models pay adequately for
    the physicians to stay in business, because that is one of the
    big issues. A lot of practices are really at the margins for
    survivability.
        I really am very in favor of Alternative Payment Models. I
    am very excited about the possibility of trying it, but it is
    going to be the--you know, the devil is in the details. It is
    how much is actually going to be part of the prospective
    payment that I think is going to be--and what is going to be
    upside and downside risk is going to be the real key.
        Senator Wyden. Any others? Dr. McAneny?
        Dr. McAneny. Thank you.
        So I think there are several things that can be done for
    this. First, when a small community of physicians wants to get
    together and try to provide services that are less expensive
    and more timely delivered, they are impeded by the Stark and
    anti-kickback rules. They cannot get together and say, ``Gee,
    if we as a group purchased a scanner, we could charge a third
    of what is charged at the local hospital.'' And they cannot get
    together to do those kinds of things. So adjusting the Stark
    and anti-kickback rules would help immensely.
        To recognize that the rural areas often have more of the
    social determinants of health in terms of food insecurity and
    housing insecurity, et cetera, is something that needs to be
    accounted for in the attribution. That may be a part of why a
    lot of rural areas score lower in terms of their hospital
    quality and physician quality, because the social determinants
    are such a major input.
        Then stability and some up-front payments--it takes,
    basically, money to invest in creating a new delivery system,
    to hire a new nurse to do the patient education that is needed
    or the outreach to find that patient who needs an intervention.
    And without the up-front, firm commitment to increased
    resources, you cannot guarantee someone that they will be able
    to do that.
        And third, the other impediment is the data. When we get
    data from CMS, it is a year or a year and a half later. It is
    aggregated data. It is impossible to manage that data in a way
    that I can figure out what I could do differently in my
    practice today so that my next reports come out better. And
    simplifying and clarifying the data that is delivered from CMS
    and making it happen in a more timely manner, would be great.
        And stabilizing the payment system--if you do not know that
    your practice is going to be there next year, it is hard to
    spend a lot of money worrying about innovation.
        Senator Wyden. Anybody else? And then we will probably wrap
    up. Yes?
        Dr. Fiedler. I think there are opportunities to think about
    how we improve measurement in ways to make sure that providers
    in rural areas are being compared against providers that are
    providing care in similar circumstances. So you could think
    about approaches that would compare providers against either
    other providers in their own region, or other providers in
    geographically similar regions.
        The various ACO programs have taken steps in that
    direction, but I think there are opportunities to go further
    beyond ACOs.
        Senator Wyden. This would be another area where I think it
    would be very helpful for you all to use the time the chairman
    allows to get us any responses in writing on this. You know,
    there is no question with respect to, sort of, the nuts and
    bolts of getting from here to there. In other words, you do not
    quickly move a $3.5-trillion health-care system, which, as we
    know, has given short shrift to rural America in many respects
    like this.
        So I am very sympathetic to these kinds of transition
    areas. It is like, Dr. Cullen, when I talked to you about the
    CHRONIC Care bill, we never announced that the legislation was
    the end of the debate. We said, ``This is the beginning. This
    is the beginning.''
        And Robert Pear, on this sad day, was the guy who figured
    that out. So your ideas are welcome. You have Democrats and
    Republicans here aligned with you.
        As you can tell, the members are just juggling. And on
    behalf of the chairman, we just want to say ``thank you'' to
    all of you for your participation. It is hard to get to
    Washington, and the chairman wants to make it clear that he
    appreciates everybody's expertise and coming.
        And on behalf of him, I would ask that any member who
    wishes to submit questions for the record to the Finance
    Committee, please do so by close of business on Wednesday, May
    22nd. And as we have indicated, there is a lot of interest in
    rural health care.
        And chronic care is almost my passion now, because I think
    this is the future of health care. And this committee figured
    that out. So we really thank all of you.
        And with that--and I want to check with both the Republican
    and the Democratic side--I believe that there is a consensus,
    because of the schedule, that we are going to wrap up. And with
    that, the hearing is adjourned.
        [Whereupon, at 11:24 p.m., the hearing was concluded.]

                                A P P E N D I X

                  Additional Material Submitted for the Record

                                  ----------

              Prepared Statement of John S. Cullen, M.D., FAAFP,
                President, American Academy of Family Physicians
        The American Academy of Family Physicians (AAFP) represents 134,600
    physicians and medical students nationwide. Family physicians conduct
    approximately one in five of the total medical office visits in the
    United States per year--more than any other specialty. They delivery
    care in more than 90 percent of U.S. counties--in frontier, rural,
    suburban and urban areas. They practice in a variety of professional
    arrangements, including privately owned solo practices as well as large
    multi-specialty integrated systems and public health agencies.

        Family physicians provide comprehensive, evidence-based, and cost-
    effective primary care dedicated to improving the health of patients,
    families, and communities. Family medicine's cornerstone is an ongoing
    and personal patient-physician relationship where the family physician
    serves as the hub of each patient's integrated care team. More
    Americans depend on family physicians than on any other medical
    specialty.

        The Medicare Access and CHIP Reauthorization Act (MACRA) created a
    major shift in how Medicare compensates physicians for their
    professional services. Congress passed MACRA to move the Medicare
    program away from a system that rewarded volume toward one that
    supports value. Family physicians continue to be among the most
    committed physicians to value-based care and payment--and transitioning
    away from fee-for-service. Our most recent annual survey of members
    found that:

              41 percent practice in Patient-Centered Medical Homes
            (PCMHs),
              54 percent are in value-based payment models or contracts,
              38 percent of CPC+ participants are AAFP members, and
              Of physicians choosing to practice in an ACO, more than half
            are in the Medicare Shared Savings program (55 percent).

        Our recommendations on what is working under MACRA--and what must
    be improved--are based on these collective experiences.
                                 what's working
        The AAFP continues to support MACRA, most notably because it
    repealed the flawed sustainable growth rate formula, but also because
    emerging alternative payment models catalyzed by MACRA place greater
    emphasis on investments in family medicine and primary care. Fee-for-
    service payment is a barrier to many aspects of primary care
    transformation and the kind of primary care-based health system this
    country needs and deserves. The AAFP remains pleased that MACRA places
    a priority on the transition of physician practices from the legacy
    fee-for-service payment model toward alternative payment models that
    promote improved quality and efficiency.

        Through the creation of the Advanced Alternative Payment Model
    pathway, MACRA created an opportunity for physicians to pursue non-fee-
    for-service payment. MACRA also created an opportunity for physicians
    to create and propose alternative payment models through the Physician-
    Focused Payment Model Technical Advisory Committee (PTAC). The AAFP was
    one of the first organizations to successfully submit a model through
    the PTAC. The AAFP's Advanced Primary Care Alternative Payment Model
    was approved by the PTAC in December 2017, receiving one of the
    strongest recommendations by the PTAC to date. The AAFP remains fully
    supportive of the PTAC's role in evaluating physician-focused payment
    models.

        On April 22nd, the AAFP was pleased to join a CMS Innovation Center
    discussion on primary care. For more than 20 years, the AAFP and our
    primary care colleagues have worked to create a delivery system that
    encourages innovation in primary care delivery and rewards
    comprehensive, continuous, patient-centered care rather than single
    episodes of care. Throughout this time, the AAFP has provided family
    medicine's perspective and input. That effort is ongoing, and we
    continue to work with CMS and the Innovation Center to build a stronger
    foundation for primary care that is patient-centered and focused on
    value and outcomes. The announcement of the Primary Cares Initiative,
    which contains five new models, is a critical step toward recognizing
    the importance of primary care by developing payment models that value
    primary care. We applaud the introduction of new primary care delivery
    and payment models, and we look forward to working with CMS and CMMI on
    testing and developing these models so they are available, attractive
    and workable for all primary care practices, including those that are
    small and/or rural.

        While MACRA's framework is still the right approach, operational
    challenges persist especially for family physicians participating in
    the intricate fee-for-service-based MIPS program.
                               what's not working
        Our recommendations focus on five main issues:

            1.  Correcting the undervaluation of fee-for-service payment
            for primary care.

            2.  Reducing the complexity in MIPS scoring.

            3.  Eliminating the MIPS APM category.

            4.  Extending the Advanced APM bonus.

            5.  Creating a culture focused on patient care.
    (1) Correcting the Undervaluation of Fee-for-Service Payment for
            Primary Care
        Even though AAFP supports movement away from fee-for-service
    models, the fee schedule is still a critical component of physician
    payment and will continue to be the foundation for future payment.
    Congress should direct CMS to aggressively address inequities in the
    Medicare fee schedule that undervalue primary care services--especially
    the office-based evaluation and management (E/M) codes for new and
    established patients. The MACRA Quality Payment Program (QPP)
    perpetuates the undervaluation of primary care services in the fee
    schedule as part of MIPS. To the extent advanced alternative payment
    models (AAPMs) rely on current relative values assigned to primary care
    services under the fee schedule, the AAPM track of QPP also perpetuates
    these longstanding imbalances in Medicare physician payments.

        Specifically, Congress should urge CMS to increase the relative
    value of ambulatory E/M and other primary care services to rebalance
    the Medicare physician fee schedule. This is not just an AAFP
    perspective. It's also the perspective of Congress's own advisors, the
    Medicare Payment Advisory Commission (MedPAC). In its June 2018 report
    to the Congress, MedPAC stated:

            Ambulatory evaluation and management (E&M) services . . . are
            essential for a high-quality, coordinated health care delivery
            system. These visits enable clinicians to diagnose and manage
            patients' chronic conditions, treat acute illnesses, develop
            care plans, coordinate care across providers and settings, and
            discuss patients' preferences. E&M services are critical for
            both primary care and specialty care. The Commission is
            concerned that these services are underpriced in the fee
            schedule for physicians and other health professionals (``the
            fee schedule'') relative to other services, such as procedures.
            This mispricing may lead to problems with beneficiary access to
            these services and, over the longer term, may even influence
            the pipeline of physicians in specialties that tend to provide
            a large share of E&M services.\1\
    ---------------------------------------------------------------------------
        \1\ Medicare Payment Advisory Commission. June 2018 Report to the
    Congress: Medicare and the Health Care Delivery System. P. 65. http://
    www.medpac.gov/docs/default-source/reports/
    jun18_ch3_medpacreport_sec.pdf?sfvrsn=0. Accessed February 6, 2019.

        We share MedPAC's concern, and like MedPAC, we believe CMS should
    use a budget-neutral approach that would increase payment rates for
    ambulatory E/M services while reducing payment rates for other services
    (e.g., procedures, imaging, and tests). Primary care services must be
    held harmless from any necessary budget-neutrality adjustments
    resulting from an increase in the relative value of primary care
    services. Otherwise, the positive impact of those increases will be
    diluted. Thus such budget neutrality should not occur by adjusting the
    conversion factor but rather reducing the payment rates for non-E/M
    services.
    (2) Reducing MIPS Scoring Complexity
        The implementation of MIPS has created a burdensome and extremely
    complex program. Primary care practices' main priority is to remain
    singularly focused on delivering high-quality patient care. However,
    understanding the requirements and scoring for each performance
    category and reporting data to CMS is a complex task and detracts from
    primary care practices' ability to focus on patients. Unfortunately,
    CMS continues to struggle to provide timely and clinically actionable
    data because the MIPS cost category measures are flawed and hold
    primary care physicians more accountable for total cost of care than
    other sub-specialties. We urge Congress to extend CMS's authority to
    weigh the MIPS cost category below 30 percent to allow time to overhaul
    existing measures.

        One of the more concerning portions of MIPS is the Promoting
    Interoperability (PI) category. CMS is hamstrung in PI since the agency
    is bound to Meaningful Use requirements by legislation, including both
    the American Recovery and Reinvestment Act and the Affordable Care Act.
    The AAFP calls on Congress to repeal Meaningful Use requirements and
    allow HHS to remove these requirements from the PI category. We are
    pleased that HHS is pursuing interoperability and stopping information
    blocking through rulemaking and are preparing extensive comments, due
    in early June.

        While the AAFP appreciates the efforts to simplify the PI category,
    we remain extremely concerned and adamantly opposed to the ``all or
    nothing'' nature of the category. CMS believes the category is not
    ``all or nothing,'' as an eligible clinician can submit a numerator as
    low as one. However, failure to report one measure results in a
    category score of zero. For all intents and purposes, this is an ``all
    or nothing'' structure.

        CMS should eliminate health IT utilization measures and remove any
    required measures and provide eligible clinicians the flexibility to
    select measures relevant to their practice. All measures within the
    promoting interoperability category should be attestation-based.

        Congress and CMS should work together to improve the implementation
    of the PI category by removing legislative barriers that restrain and
    complicate the category. Congress should encourage CMS to simplify the
    scoring, remove health IT utilization measures and the ``all or
    nothing'' requirement, and hold Health IT vendors accountable for
    interoperability before measuring physicians on EHR use.

        The AAFP is supportive of the industry's move to 2015 edition
    CEHRT. Yet, we have concerns with it being mandated for eligible
    clinicians (ECs). We must also realize that adopting a 2015 edition
    CEHRT does not mean that a practice or hospital will be interoperable.
    Mandates are more beneficial to health information technology (IT)
    developers than to ECs. Mandates relieve market pressures to lower the
    cost of upgrades and increase the value of upgraded versions. The cost
    of EHRs continues to rise, whereas IT cost in every other industry has
    decreased. We strongly encourage CMS to not mandate 2015 edition CEHRT,
    but rather incentivize its adoption through scoring, which benefits
    2015 edition CEHRT users.

        In a letter the AAFP sent HHS early this year, we discussed how
    Health IT and EHR vendors should be more fully regulated to address
    mal-aligned and self-serving behaviors by these vendors. An HHS draft
    report laid out a set of strategies and recommendations and the AAFP
    was largely supportive of them. However, the AAFP strongly urges HHS to
    convert the ``could,'' ``should,'' and ``encourage'' language in the
    report into required actions. Compliance with these mandates by vendors
    will significantly decrease the administrative burdens of physicians.
    It is time for them to be mandates and not suggestions.

        Congress should guide CMS to reduce the complexity and
    administrative burden of MIPS. CMS could accomplish this by providing
    cross-category credit for measures and activities that span multiple
    performance categories. We believe an updated architecture where
    reporting once and receiving credit in multiple categories could
    alleviate significant burden from practices and allow them to focus
    their efforts on better patient care.
    (3) Eliminating the MIPS APM Category
        The AAFP remains quite concerned with the MIPS APM option created
    by CMS but not referenced in MACRA's statutory language. The AAFP is
    concerned eligible clinicians may intentionally remain in MIPS APMs,
    given the scoring advantage they have been given, instead of
    progressing toward advanced APMs, which was the congressional intent
    behind MACRA.

        By remaining in MIPS, MIPS APMs will skew the MIPS performance
    threshold. This is already apparent in the 2017 performance period,
    where the performance threshold was three and the exceptional
    performance threshold was 70. MIPS APMs tend to be larger practices
    that are part of an accountable care organization (ACO), which has the
    resources and technology to better support their MIPS participation. In
    the 2017 Quality Payment Program (QPP) Reporting Experience report
    published by CMS, MIPS APMs had a mean final score of 87.64 and median
    final score of 91.76. The MIPS APM final scores are higher than the
    national mean and median final scores which were 74.01 and 88.97. Even
    more disconcerting is the difference between MIPS APM scores and scores
    of small and rural practices. The mean and median final scores for
    small practices were 43.46 and 37.67, respectively. This is a
    significant discrepancy that favors MIPS APMs and compromises the
    integrity of the program.
    (4) Extending the Advanced APM Bonus
        Given the limited availability of AAPMs to date, we strongly urge
    Congress to extend the 5 percent Advanced APM bonus for three to 5
    years beyond the current statutory restriction and include language
    giving the Secretary of HHS discretion to extend the bonus further.
    (5) Creating a culture focused on patient care
        Feedback we have received is that most family physicians,
    especially those in independent practices, believe that the MIPS
    program has a net-negative impact on their practices. While comfort
    with the existing fee-for-service system may play a role, the feedback
    we have received from family physicians, based on analysis of their
    practice trends, suggest that the MIPS program requirements place
    economic strains on their practices.

        The AAFP strongly supports streamlining MIPS documentation
    requirements and reducing administrative burden in all health care
    programs--both public and private. One of the most onerous
    administrative burdens is prior authorization, which tops the list of
    physician complaints on administrative burden. This uncompensated work
    for physicians and staff translates into increased overhead costs for
    practices, disrupts workflows, and results in inefficiencies and
    reduction in time spent with patients. According to AMA data,
    interactions with insurers cost $82,975 annually per physician.
    Exacerbating this is most family physicians in private practice have
    contractual relationships with seven or more health insurance plans,
    including Medicare and Medicaid. In coalition with 16 other medical
    organizations, the AAFP has called for the reform of prior
    authorization and utilization management requirements that impede
    patient care in Prior Authorization and Utilization Management Reform
    Principles. In addition, the AAFP has published, Principles for
    Administrative Simplification, calling for an immediate reduction in
    the regulatory and administrative requirements family physicians and
    practices must comply with daily.

        Quality measure reporting is another source of administrative
    burden for physicians and their practices. According to a study
    discussed in Health Affairs, physician practices spend, on average, 785
    hours per physician and more than $15.4 billion annually to report
    quality measures. Quality reporting takes considerable time away from
    patient care while causing a considerable financial strain on
    practices, particularly those that are small and/or rural.

        The AAFP strongly supports the CMS Patients Over Paperwork
    initiative but believes more must be done to improve patient care
    within the MIPS program by reducing administrative burdens. So that
    family physicians can devote more time to patient care, we urge
    Congress to influence action by all payers to reduce the administrative
    complexity so that physicians can more fully focus on patient care.
                           additional recommendations
        The AAFP makes the following recommendations to improve Medicare
    payment systems:

            1.  Congress should extend the 0.5-percent baseline conversion
            factor update until 2026. Doing so would help mitigate budget-
            neutrality cuts required by separate laws such as the
            Protecting Access to Medicare Act (PAMA) and help adjust for
            inflation. This rate of increase does not match increase in
            cost or inflation, but it does provide a minimum level of
            economic growth.

            2.  Congress should encourage CMS to continue to focus on
            outcomes and
            patient-reported outcome measures that are more impactful for a
            practice and for patients.

            3.  The AAFP asks Congress to reimagine how the exceptional
            performance positive payment adjustments are applied to reward
            practices that achieve significant year-over-year improvement
            versus rewarding those practices at the upper levels of annual
            performance. In 2019, practices that achieve a final score of
            75 points are eligible for up to an additional 10 percent
            positive payment adjustment. While we applaud these high-
            performing practices, it is our belief that additional positive
            payment adjustments would be better used if they were focused
            on rewarding the hard work of practices that achieve year-over-
            year improvements.

                                   conclusion

        Once again, thank you for the opportunity to discuss with this
    committee the impact of MACRA on family physicians and its potential to
    build a patient-focused health care delivery system built upon a well-
    resourced foundation of primary care.

                                     ______

       Questions Submitted for the Record to John S. Cullen, M.D., FAAFP
                    Questions Submitted by Hon. Rob Portman
        Question. I introduced the Medicare Care Coordination Improvement
    Act with Senator Bennet in an effort to reduce some of the barriers
    that providers face when they participate in Alternative Payment
    Models. However, one particular section of my bill focuses on providing
    temporary waivers to practices that are interested in testing their own
    APMs. HHS has been slow to take up new APM concepts, and thus: what can
    we do to incentivize the establishment of new APMs? Has the PTAC
    offered a viable way to propose and test new APMs? If not, what actions
    could be taken to encourage the adoption of PTAC models?

        Answer. Establishing New and Increasing Participation in APMs: The
    AAFP is committed to transforming the Medicare program into one that
    prioritizes the delivery of high-quality, patient-centered, and
    efficient care. As we have previously stated, and literature supports,
    achieving meaningful transformation of our health-care system starts
    with creating a system foundational in primary care--and increased
    investment in primary care to sustain the transformation.
    Unfortunately, a recently released RAND study estimated that only 2-5
    percent of Medicare spending is on primary care. This is despite the
    growing evidence on the positive impacts of primary care on quality,
    lower rates of mortality and overall system spending.

        As a result, we recommend that Congress require CMS to establish
    APMs that significantly increase investments in primary care--andexpand
    existing APMs, such as CPC+ to encourage greater participation among
    primary care practices. AAFP would welcome the opportunity to work with
    Senators and the committee to develop proposals to accomplish these
    objectives.

        Reevaluation of Primary Care Payments in Medicare: The AAFP also
    recommends that the committee support revaluation of ambulatory E&M
    services, which is critical to move physicians into value-based,
    Advanced Alternative Payment Models (AAPMs). As MedPAC observed in its
    June 2018 report, all Advanced APM models use fee-for-service payment
    rates as either the basis of payment or the reference price for setting
    the global or bundled payment amount. If the actuarial basis for E&M
    payment alternatives is the relative values currently assigned to E&M
    services under fee-for-service, then the foundation of the
    corresponding Advanced APM is fundamentally flawed and will undermine
    efforts to create viable APMs for primary care to participate in.

        Like MedPAC, we believe CMS should use a budget-neutral approach
    that would increase payment rates for ambulatory E/M services while
    reducing payment rates for other services (e.g., procedures, imaging,
    and tests). Thus, the committee should support the revaluation of
    ambulatory E&M codes to ensure CMS succeeds in moving physicians into
    value-based, APMs.

        Another way Congress could promote the adoption of APMs is to
    address low Medicaid physician payment rates which have historically
    created a barrier to health-care access for Medicaid enrollees. AAFP
    policy \1\ supports Medicaid payment for primary care services at least
    equal to Medicare's payment rate for those services when provided by a
    primary care physician. Accordingly, we urge Congress to resume Federal
    primary-care payment policy previously found in Medicaid--SSA
    1902(a)(13)(C) and provide Federal funding to ensure a floor of
    Medicare payment rates for primary care services in Medicaid.
    ---------------------------------------------------------------------------
        \1\ https://www.aafp.org/about/policies/all/medicaid-
    principles.html.

        Physician-Focused Payment Model Technical Advisory Committee
    (PTAC): Through the creation of the Advanced APM pathway, MACRA created
    an opportunity for physicians to pursue non-fee-for-service payment.
    MACRA also created an opportunity for physicians to create and propose
    alternative payment models through the Physician-Focused Payment Model
    Technical Advisory Committee (PTAC). The AAFP was one of the first
    organizations to successfully submit a model through the PTAC. The
    AAFP's Advanced Primary Care Alternative Payment Model was approved by
    the PTAC in December 2017, receiving one of the strongest
    recommendations by the PTAC to date. Following approval of the APC-APM,
    the AAFP worked with CMS and the Innovation Center to inform the design
    of the Primary Care First (PCF) model--but unfortunately as currently
    designed it does not in our view represent an increased investment in
    primary care as proposed in the AAFP's APC-APM PTAC approved APM model.
    We continue to advocate for improvements to the model to better align
    with the AAFP's APC-APM proposal. The AAFP remains fully supportive of
    ---------------------------------------------------------------------------
    the PTAC's role in evaluating physician-focused payment models.

        Question. Per data from CMS, about half of all Medicare providers
    are participating in MIPS, with the majority of these non-participating
    providers being exempt via the low-volume threshold. While we don't
    want to place additional burdens on small and rural providers, we
    should be identifying ways to engage with these practices to help them
    transition towards value-based outcomes.

        What actions should be taken to engage with these providers?

        Answer. Burden of Reporting for Small Practices: The current MIPS
    reporting requirements necessitate an expanded human and technological
    infrastructure that many practices cannot afford, including most small
    rural practices. In the AAFP's 2017 Value-based Payment Study, 70
    percent of respondents indicated lack of staff time as a barrier to
    implementing value-based care, while 41 percent indicated the financial
    investment required for health information technology (HIT) is a
    barrier. Among practice owners, 74 percent cite lack of staff time and
    52 percent cite financial investment as barriers to implementing value-
    based care. Further, CMS continues to change program requirements,
    which makes compliance a moving target. Rural practices do not have the
    resources to dedicate staff solely to MIPS reporting as their staff is
    primarily involved in patient care. To reduce reporting burden for all
    MIPS clinicians, Congress should allow CMS to provide scoring
    flexibility through multi-category credit. The AAFP's written testimony
    provides additional details on how this could be implemented.

        There should be a single set of performance measures across all
    payers that are universal, meet the highest standards of validity,
    reliability, feasibility, importance, and risk adjustment. The measures
    should focus on outcomes that matter most to patients and that have the
    greatest overall impact on better health of the population, better
    health care, and lower costs.

        Measures of performance should be derived from data that are
    extracted from multiple data sources rather than self-reported by
    physicians and their teams. Self-reported data are seldom validated for
    accuracy, reliability, missing data, coding variation, and application
    of measure specifications. Elimination of self-reporting will end
    current financial penalties for non-reporting that disproportionately
    impact small practices. Data extraction will reduce administrative
    burden and resolve comparability problems in performance data submitted
    through various mechanisms. Health IT advancements are needed, but
    physicians cannot be expected to continue bearing the burden of data
    collection and reporting while awaiting technological solutions.

        Process measures that rely on self-measurement are best used for
    internal quality improvement efforts to drive changes and improvements
    to achieve higher level outcomes.

        Performance measures should be applied at a system level, as on
    their own individual health-care professional have limited ability to
    drive outcomes and are constrained by the environment and systems in
    which they practice. Performance measures can identify gaps in services
    and outcomes at the entity, community, and population levels, and they
    can be used to direct allocation of public and private resources to
    address unmet needs. Such measures should lead to investment of
    resources to improve equity, access, and socioeconomic factors that
    impact health and health care.

        One of the more concerning portions of MIPS is the promoting
    interoperability (PI) category. CMS is hamstrung in PI since the agency
    is bound to Meaningful Use requirements by legislation, including both
    the American Recovery and Reinvestment Act and the Affordable Care Act.
    The AAFP calls on Congress to repeal Meaningful Use requirements and
    allow HHS to remove these requirements from the PI category.

        Congress and CMS should work together to improve the implementation
    of the PI category by removing legislative barriers that restrain and
    complicate the category. Congress should encourage CMS to simplify the
    scoring, remove health IT utilization measures and the ``all or
    nothing'' requirement, and hold health IT vendors accountable for
    interoperability before measuring physicians on EHR use.

        Electronic Health Records (EHRs) Continue to Pose Significant
    Challenges for Small and Rural Practices:\2\ With fewer resources
    available, some rural practices use less expensive EHRs that have
    limited capabilities, which can make interoperability significantly
    more difficult. Additionally, EHRs often lack adequate technical
    support or may charge for providing basic user support. CMS's mandate
    to implement 2015 Edition certified EHR technology requires additional
    financial investments and staff support further inflate the barriers to
    successful value-based payment participation for rural practices. The
    AAFP welcomes the opportunity to partner with the committee as it
    considers ways to boost clinically meaningful HIT use among small
    practices.
    ---------------------------------------------------------------------------
        \2\ https://www.gao.gov/assets/700/692179.pdf.

        Allow CMS to Set MIPS Performance Thresholds Based on Practice
    Size: Rural practices, particularly small rural practices, have unique
    challenges as compared to large practices in urban and suburban areas.
    Small, rural practices typically have fewer staff and limited resources
    to manage the Merit-based Incentive Payment System (MIPS) reporting
    requirements that otherwise burden all participants. The challenge to
    participate is demonstrated by the mean and median 2017 MIPS final
    scores for rural practices, which were 63 and 75 respectively. In
    contrast, MIPS Alternative Payment Model (APM) participants, which tend
    to be large practices, had a mean score of 88 and a median score of 92.
    To address this scoring and ultimate payment adjustment disparity,
    Congress should provide CMS additional flexibility to establish
    multiple performance thresholds for practices dependent on size.
    Separate performance thresholds would allow CMS to set thresholds that
    better reflect a practice's ability to meaningfully participate in
    MIPS--potentially narrowing the gap between small and large practices
    and facilitating a move to practice accountability. An inflated
    performance threshold will disproportionately reward large practices
    with more resources while effectively punishing small and rural
    practices that have fewer resources. Without an attainable performance
    threshold for small and rural practices, the program's goal to move
    ---------------------------------------------------------------------------
    practices to performance accountability is diminished.

        Accommodations for Higher Rural Practice Costs: Rural areas also
    tend to have fewer sub-specialists, resulting in rural patients
    receiving nearly all their health care from their primary care
    physician. When sub-specialists are available, there is a smaller
    network from which to choose. As a result, rural primary care practices
    could have higher costs as compared to urban and suburban practices
    with a larger referral network. Additionally, ensuring patients receive
    timely and appropriate preventive care is difficult for rural
    practices, as patients can be unwilling to travel long distances.
    Higher costs negatively impact rural practices' MIPS performance
    relative to their urban and suburban counterparts and makes them
    potentially less attractive to entities in Advanced Alternative Payment
    Models. Congress should extend CMS's authority to reweight the MIPS
    cost category until such time when valid and reliable cost measures are
    available for all eligible clinicians. The committee should consider
    ways to ensure the MIPS cost category fairly captures and represents
    the costs of care in rural areas where primary care physicians often
    provide a broad range of services to their communities.

                                     ______

                     Questions Submitted by Hon. Ron Wyden
        Question. The Independence at Home demonstration, which was
    expanded and extended last year through the CHRONIC Care Act, enables
    care teams to deliver high-quality primary care to Medicare
    beneficiaries in the comfort of their own homes. In its third
    performance year, according to the Centers for Medicare and Medicaid
    Services (CMS), Independence at Home saved $16.3 million for the
    Medicare program.\3\ A recent evaluation also found that Independence
    at Home has resulted in fewer emergency department visits leading to
    hospitalization, a lower proportion of beneficiaries with at least one
    unplanned hospital readmission during the year, and a reduced number of
    preventable hospital admissions.\4\ As I mentioned at the hearing, I am
    committed to building on the success of the Independence at Home
    demonstration. As discussed at the hearing, I understand that the new
    Primary Care First model recently announced by CMMI (the Center for
    Medicare and Medicaid Innovation at CMS) may provide an avenue to
    expand access to home-based primary care for more Medicare
    beneficiaries.
    ---------------------------------------------------------------------------
        \3\ https://innovation.cms.gov/Files/fact-sheet/iah-yr3-fs.pdf.
        \4\ https://innovation.cms.gov/Files/reports/iah-rtc.pdf.

        Based on your members' experience in Independence at Home and other
    Alternative Payment Models, what key components will be necessary in
    order for the Primary Care First model to expand access to home-based
    ---------------------------------------------------------------------------
    primary care?

        Answer. Home Based Primary Care (HBPC) provides value for
    chronically ill, medically complex, homebound patients in terms of
    quality and overall cost reduction. Payment reform and new models of
    care (including Primary Care First and Direct Contracting) are
    supportive of HBPC. Despite this, attempting to do HBPC as a solo/
    independent provider is challenging due to factors such as call
    rotation, establishing/training a care team, community outreach/
    referral, uninsured patients, and reduced patient volume. HBPC depends
    on ACO-type goals that allow investment in programs that lead to
    overall reduction in health system costs.

        To expand access to home-based primary care, Medicare payment must
    be based on continuing, comprehensive care and should encourage
    treatment on an ambulatory basis rather than in a costly institutional
    setting. The AAFP advocates for efforts to align payment policies for
    physicians in independent practice with those owned by hospitals. The
    AAFP encourages consideration of site-of-service payment parity polices
    from a broad perspective. Namely, CMS should not pay more for the same
    services in the inpatient, outpatient, or ambulatory surgical center
    setting than in the physician office setting. The AAFP calls for
    incentives for services to be performed in the most cost-effective
    location, such as a physician's office. The AAFP considers the
    artificial distinction between ``inpatient,'' ``outpatient,'' and other
    sites of service as a product of the equally artificial distinction
    between Medicare's Part A and Part B. The AAFP calls for policies that
    progress beyond this silo mentality and instead pay for health-care
    services in a more consistent and equitable manner.

        The AAFP also encourages alignment between alternative payment
    models and the benefit enhancements and payment waivers offered.
    Waivers that would facilitate cost effective home-based primary care
    include the Telehealth Expansion Waiver, Post-Discharge Home Visits
    Rule Waiver, and Care Management Home Visits Rule Waiver. We also
    recommend exploring other waivers that reduce barriers to home-based
    primary care, like extending the ability to certify a patient's
    eligibility for home health services to other members of the care team
    and allowing home health services to be offered to patients who do not
    meet the definition of ``homebound'' but would otherwise benefit from
    receiving some or all of their health care at home.

        Question. What other specific policies would you recommend Congress
    or CMS consider to expand access to home-based primary care for more
    Medicare beneficiaries?

        Answer. As stated above, Medicare payment must be based on
    continuing, comprehensive care and should encourage treatment on an
    ambulatory basis rather than in a costly institutional setting.

        Question. As I mentioned during the hearing, I often hear from
    seniors in Oregon that they don't feel like anyone is in charge of
    managing their health care and helping them navigate the health-care
    system. I am proud of the bipartisan work that this committee did on
    the CHRONIC Care Act last Congress to update the Medicare guarantee. In
    my view, the next step should be making sure that all Medicare
    beneficiaries with chronic illnesses have someone running point on
    their health care--in other words, a chronic care point guard--
    regardless of whether they get their care through Medicare Advantage
    (MA), an Accountable Care Organization (ACO) or other Alternative
    Payment Model, or traditional fee-for-service Medicare.

        For beneficiaries in traditional, fee-for-service Medicare, what
    can be done to improve care coordination and make sure their physicians
    and other health-care professionals are all talking to each other and
    working together to provide the best possible care to those
    beneficiaries? What specific policies would you recommend this
    committee pursue toward that end?

        Answer. Data Sharing/EHRs: Family physicians, above all else, seek
    to protect the well-being and health of their patients. Increasingly in
    today's health-care landscape, primary care physicians are accountable
    for safe and effective coordination of care and care management, as an
    integral component of routine business practices. The primary care
    physician should have access to information contained in a
    clearinghouse and be given data (treatment and diagnostic codes, dates,
    medications, provider name/contact information) on all procedures,
    treatments, and diagnoses billed by all other entities to enhance the
    ability of primary care to safely and effectively coordinate care and
    manage costs. This data should be in a standard form that is importable
    into the EHR without special effort by the primary care physician team.

        Patients value the ability to easily access all their health data
    in one place. Access to complete data improves patient ability to
    better engage in care which leads to better outcomes. Patients can be
    extremely effective partners in care coordination when they have easy
    access to all their data and are able to share it with all health-care
    professionals.

        Interoperability is a critical issue. Since Meaningful Use an
    appropriate growth in the exchange of health records occurred.
    Unfortunately, these records are merely in standard formats that allow
    data to be transmitted between EHR systems and not yet in forms that
    allow automated importing into the patient's record in the receiving
    EHR or for authorized applications to extract key patient data. The
    consequences create a tremendous amount of burden placed on the
    physician to scour information for buried key clinical information and
    then ``re-key'' that data into the patient's EHR. Without what is
    called semantic interoperability (i.e., shared meaning), this will
    continue to be a burden to physicians and create patient safety risk.
    While there are pockets of such importable data, there is not
    widespread or expansive in the types of clinical data covered. The AAFP
    believes that HHS has the authority needed to address the current
    issues through MACRA and the 21st Century Cures Act. We ask Congress to
    provide continued oversight of HHS's implementation of these laws.

        Payments for Care Management: Care coordination is also possible
    when practices have resources to support non-face-to-face care
    management. Primary care practices should receive care management fees
    or population-based payments that support consultations across
    providers. This includes reimbursement for non-face-to-face care
    management. The AAFP suggests Congress and CMS consider a care
    management fee or population-based payment for non-face-to-face care
    management that can support consultations and care coordination.

        Question. Please describe the specific steps that Congress and/or
    CMS could take to ensure all Medicare beneficiaries with chronic
    illnesses, including those in traditional fee-for-service Medicare,
    have a chronic care point guard.

        Answer. Access to Primary Care Physicians: All Medicare
    beneficiaries should be attributed to one primary care physician that
    agrees to be responsible for overall care. Waiving co-pays for seeing
    their primary care providers is essential to discourage patients from
    going directly to sub-specialist without seeking primary care first.
    Notification to the PCP of care provided by all other entities should
    be mandatory. Payers should be held accountable for making certain all
    their beneficiaries have a primary care physician that has agreed to be
    responsible for overall care.

        Congress and CMS should only allow physicians specifically trained
    for and skilled in comprehensive first contact and continuing care for
    persons with any undiagnosed sign, symptom, or health concern (the
    ``undifferentiated'' patient) not limited by problem origin
    (biological, behavioral, or social), organ system, or diagnosis to bill
    services such as the Chronic Care Management (CCM) code. A primary care
    physician is a specialist in family medicine, internal medicine, or
    pediatrics who provides definitive care to the undifferentiated patient
    at the point of first contact and takes continuing responsibility for
    providing the comprehensive care to the patient. Such a physician must
    be specifically trained to provide comprehensive primary care services
    through residency or fellowship training in acute and chronic care
    settings. Physicians who are not trained in the primary care
    specialties of family medicine, general internal medicine, or general
    pediatrics, at times, may provide some primary care ``services'' that
    are similar to those usually delivered by primary care physicians--but
    this does not constitute primary care. These physicians may focus on
    specific patient care needs related to prevention, health maintenance,
    acute care, chronic care, or rehabilitation. These physicians, however,
    do not offer these services within the context of comprehensive, first
    contact, and continuing care.

        Further, we urge Congress to eliminate the applicability of
    deductible and co-
    insurance requirements for the CCM codes. Eliminating CCM cost-sharing
    requirements would facilitate greater utilization of these codes and
    increase coordination of care for those beneficiaries with the greatest
    health-care needs.

        Access to Patient-Centered Medical Homes: In 2018, the AAFP Board
    of Directors approved the ``Health Care for All'' policy, which
    includes a number of guiding principles and considerations for health
    reform. One of these guiding principles is the establishment of a
    primary care-based health system, which include ensuring access to a
    primary care physician and a medical home for all Americans. In an
    annual \5\ review of evidence of the PCMH's impact on cost and quality,
    the Patient-Centered Primary Care Collaborative identifies several PCMH
    programs that have reduced costs and improved quality. Medical homes
    are associated with:
    ---------------------------------------------------------------------------
        \5\ https://www.pcpcc.org/sites/default/files/resources/
    The%20Patient-Centered%20Medical%
    20Home%27s%20Impact%20on%20Cost%20and%20Quality%2C%20Annual%20Review%20o
    f%20
    Evidence%2C%202014-2015.pdf.

              Better coordinated, more comprehensive, and personalized
            care.
              Improved access to medical care and services.
              Improved health outcomes, especially for patients who have
            chronic conditions.

        Payment Adjustments for the Social Determinants of Health: The AAFP
    policy on ``Advancing Health Equity: Principles to Address the Social
    Determinants of Health in Alternative Payment Models'' provides
    suggestions for how alternative payment models should account for SDoH
    in their payment methodologies and enable physician practices to
    overcome these barriers. We encourage policymakers to review this
    policy to create similar structures and incentives to motivate and
    enable practices to address social determinants of health.

        Question. Eligible clinicians who receive a certain percentage of
    their payments or see a certain percentage of their patients through
    Advanced APMs are excluded from MIPS and qualify for the 5 percent
    incentive payment for payment years 2019 through 2024. Starting this
    year (performance year 2019), eligible clinicians may also become
    qualifying APM participants (and thus qualify for incentive payments in
    2021) based in part on participation in Other Payer Advanced APMs
    developed by non-Medicare payers, such as private insurers, including
    Medicare Advantage plans, or State Medicaid programs.

        Recognizing that this is the first year in which the All-Payer
    Combination Option is available, how many of your members do you
    anticipate will take advantage of the All-Payer Combination Option this
    year?

        Answer. The AAFP is supportive of the All-Payer Combination Option
    but has not heard substantial feedback from members on it.

        Question. What, if any, challenges have your members faced when
    attempting to take advantage of the All-Payer Combination Option?

        Answer. The AAFP believes the onus of submitting relevant
    information on payer arrangements should fall to the payers. This is
    currently voluntary for payers. While the AAFP believes payers should
    be responsible for submitting information to CMS, we have heard from
    payers that the process is complicated and burdensome.

        We encourage Congress to reduce the qualifying participant
    thresholds since there currently are not many APMs and strongly urge
    Congress to extend the 5-percent Advanced APM bonus for 3 to 5 years
    beyond the current statutory restriction and include language giving
    the Secretary of HHS discretion to extend the bonus further.

        We anticipate challenges in reporting performance data because
    measures are not aligned among payers. Please see our comments above
    regarding the need for a single set of performance measures that are
    universal, meet the highest standards of validity, reliability,
    feasibility, importance, and risk-adjustment. The measures should focus
    on outcomes that matter most to patients and that have the greatest
    overall impact on better health of the population, better health care,
    and lower costs. Measures of performance should be derived from data
    that are extracted from multiple data sources rather than self-reported
    by physicians and their teams.

        Question. In the Medicare Access and CHIP Reauthorization Act of
    2015 (MACRA), Congress provided a total of $100 million over 5 years
    for technical assistance to MIPS-eligible clinicians in practices with
    15 or fewer clinicians, focusing on rural and health professional
    shortage areas.

        To what extent have your members utilized the services of the
    Small, Underserved and Rural Support Initiative, which CMS launched
    using the MACRA funding to provide free, customized technical
    assistance to clinicians in small practices?

        Answer. We promote to our members CMS education services as well as
    AAFP education opportunities. The AAFP encourages Congress to provide
    additional funds for technical assistance and use the $500M bonus pool
    to support small practice transformation.

        Question. What types of technical assistance and support have been
    most helpful to physicians and practices (e.g., understanding program
    requirements, selecting appropriate measures, forming virtual groups)?

        Answer. Congress provided technical assistance funds for CMS to
    support practices in MIPS. CMS created the Small, Rural, and
    Underserved Support (SURS). While these organizations have been
    helpful, they are unable to provide the in-depth and individualized
    support many small and rural practices need. The services provided \6\
    vary by each organization and may not be available to all practices.
    Additionally, the organizations can provide technical support, but they
    do not provide any financial or permanent human resources for
    practices. Stakeholders interviewed for a recent RAND report \7\ felt
    the QPP support is able to provide high-level support, but much of the
    work cannot be done by outside contractors or office managers.
    Stakeholders also reported that the support providers sometimes lacked
    knowledge in certain areas or were unable to get answers from CMS to
    specific questions. Specifically, funds are needed to pay for IT
    support specific to individual users. Technical assistance providers
    lack specific IT knowledge and funds to implement real solutions.
    ---------------------------------------------------------------------------
        \6\ https://www.gao.gov/assets/690/681541.pdf.
        \7\ https://www.rand.org/content/dam/rand/pubs/research_reports/
    RR2800/RR2882/RAND_
    RR2882.pdf.

        Second, the AAFP would recommend the exceptional performance bonus
    payments be reimagined to reward practices that achieve significant
    year-over-year improvement versus rewarding those practices at the
    upper levels of annual performance. While we applaud these high-
    performing practices, it is our belief that additional positive payment
    adjustments would be better used if they were focused on rewarding the
    ---------------------------------------------------------------------------
    hard work of practices that achieve year-over-year improvements.

        The AAFP has not received any feedback from members regarding
    virtual groups and the uptake has been low. In fact, for the 2019
    performance year, CMS estimated that only 80 TINs would form 16 virtual
    groups. While the intentions behind virtual groups were good, the
    implementation and policies have fallen short. For example, those who
    fell below the low-volume threshold but wanted to participate in a
    virtual group could voluntarily report but would not receive a payment
    adjustment. This policy made virtual groups unattractive to those
    practices that virtual groups were designed to help. CMS now offers an
    opt-in pathway for practices that are otherwise excluded to fully
    participate in MIPS. However, this does not alleviate the challenges
    practices face in trying to identify other high performing practices
    with which to form a virtual group. Nor does the opt-in pathway remove
    the administrative and infrastructure barriers presented by virtual
    groups. In addition, CMS does not aggregate data for virtual groups.
    The burden of collecting and reporting data across multiple practices
    (and multiple EHRs) falls solely to the virtual group. Since virtual
    group practices are, by definition, small, it is unlikely they have the
    time or resources to take on such an arduous task. These concerns are
    echoed in the RAND research report ``Perspectives of Physicians in
    Small Rural Practices on the Medicare Quality Payment Program.''\8\
    ---------------------------------------------------------------------------
        \8\ https://www.rand.org/content/dam/rand/pubs/research_reports/
    RR2800/RR2882/RAND_
    RR2882.pdf.

        We stand ready to work with Congress and CMS to make virtual group
    ---------------------------------------------------------------------------
    options more robust for small and rural practices.

                                     ______

                  Questions Submitted by Hon. Debbie Stabenow
        Question. Last time this committee discussed MACRA in 2016, I asked
    Andy Slavitt, then Acting Administrator of CMS, about the agency's
    plans to make it easier for rural physician practices to participate in
    APMs and MIPS. For example, some rural communities lack the required
    technology for electronic health records to participate. As someone who
    has experience with rural communities in your home State of Alaska,
    what changes have you noticed in rural communities and what could be
    improved to better accommodate rural physicians?

        Answer. As committee members have noted, it is also difficult for
    rural practices to participate in Alternative Payment Models (APMs).
    The infrastructure challenges are just as significant in APMs as they
    are in MIPS, and there are simply a limited number of Advanced APMs
    (AAPM) available. Limited financial \9\ resources and reserves make it
    difficult for rural practices to assume financial risk. A key component
    to successful APM and AAPM participation includes the implementation
    the five key functions of a medical home.\10\ The up-front investments
    needed \11\ for participation in value-based models can be significant,
    compounding the difficulties for participating. The AAFP welcomes the
    opportunity to partner with the committee to ensure that the MIPS
    program prepares practices for APM participation, and that CMS and the
    Innovation Center are creating APMs for rural and small practice
    participation.
    ---------------------------------------------------------------------------
        \9\ https://www.gao.gov/assets/690/681541.pdf.
        \10\ https://www.aafp.org/practice-management/transformation/
    pcmh.html.
        \11\ https://www.gao.gov/assets/690/681541.pdf.

        The AAFP strongly encourages Congress to provide additional funds
    for technical assistance and use the $500M bonus pool to support small
    ---------------------------------------------------------------------------
    practice transformation.

        Question. I am very proud of the work the bipartisan
    accomplishments to address Alzheimer's, including the implementation of
    my HOPE for Alzheimer's Act which required Medicare to pay for new
    individual care plans to support Alzheimer's patients and their
    families. Many of my colleagues are also cosponsors of my Improving
    HOPE for Alzheimer's Act, which will ensure beneficiaries and
    physicians know that they are able to access, and bill for, care
    planning under Medicare. In our last hearing on MACRA implementation,
    my colleagues raised the question of how we should look at quality
    measures in MIPS when it comes to physicians having these conversations
    with beneficiaries and their families and reflecting their priorities.
    Some have mentioned altering MIPS to make the quality measures more
    clinically meaningful. In what ways do you think the system would need
    to change to better incorporate long-term care planning and encourage
    physicians to have these conversations with patients?

        Answer. In general, the AAFP is discouraging the creation of
    numerous additional performance measures that focus on processes.
    Giving in to the temptation to measure everything that can be measured
    drives up cost, adds to administrative burden, contributes to
    professional dissatisfaction and burnout, encourages siloed care,
    undermines professional autonomy, and diverts resources away from the
    most important factors influencing health and health care, such as
    SDoH. Extensive experience with performance measures in various systems
    (e.g., the VA system, the United Kingdom: Quality and Outcomes
    Framework) has shown excessive measurement can cause unexpected harms
    while failing to have an enduring positive impact on health outcomes of
    interest.

        In addition, quality measures under MIPS are voluntary--
    professionals choose measures they wish to report, so measures aren't
    consistently selected or applied to all beneficiaries--this leads to a
    minimal impact on outcomes.

        A better solution may be to incorporate a more structured approach
    to screening and paying an additional fee for screening and follow-up.

                                     ______

                   Questions Submitted by Hon. Sherrod Brown
                           the patient voice in macra
        Question. In your testimony, you mention the importance of patient-
    reported outcomes. I agree that we should be measuring whether or not
    we are paying for care that is in line with the patient's goals. During
    the hearing I asked you how many of the 424 MIPS measures consider the
    patient voice and their priorities.

        Can you provide that number for me?

        Answer. Seventeen MIPS measures are classified as patient-reported
    outcome measures with 3 additional outcome measures that are not
    classified as such but are in fact patient-reported.

        Question. What more can your physician organization do to ensure
    patient needs and priorities are kept at the center of health-care
    delivery?

        Answer. Physicians could increase their use of patient-reported
    outcome measures (PROMs), but assessment alone is not enough to improve
    outcomes. Adequate community resources and social support systems are
    needed to address what the PROM reveals. Physicians alone cannot meet
    all patient needs but must rely on referral to community resources
    designed to address SDoH and non-clinical needs.

        It is important to clarify that measuring an outcome may not
    translate into good or bad clinician performance. A major challenge of
    using PROMs for performance measurement is demonstrating that the
    outcome is influenced by the care provided, and not attributable to
    other factors, such as social determinants of health. Without such
    evidence, the performance measure would not be considered a valid
    indicator of clinical performance. Like all performance measures,
    patient reported outcome performance measures must also be monitored to
    ensure there are no unintended consequences, such as potential for
    adverse patient selection. In addition, data must be feasible to
    collect, but data standards and integration into the EHR are only
    beginning to evolve.

        Challenges with using patient-reported outcomes in performance
    measurement are substantial. The Massachusetts Medical Society
    concluded that PROMs are a valid tool for internal quality improvement,
    clinical care, and patient engagement, but are still in their infancy
    and ``should not be used to compare providers or outcomes for
    payment.'' The AAFP has taken the position that that many measures
    appropriate for use as quality measures for internal improvement
    purposes may not be appropriate as performance measures.

        Question. What more can and should CMS and Congress do to ensure
    patient needs and priorities are kept at the center of health-care
    delivery?

        Answer. CMS must ensure that performance measure are limited to
    factors that have the greatest impact on health, health care, and
    costs, and are within reasonable control of the entities or
    professionals to which payment adjustments apply to avoid unintended
    consequences of measurement.

        Primary care services should be exempt from cost-sharing
    requirements such as deductibles and co-payments. For instance, the
    establishment of a standard primary care benefit \12\ would guarantee
    connectivity to the health-care system for individuals with high-
    deductible health plans and serve as a guardrail against disease
    progression that leads to more costly care. The committee should
    strongly support the Primary Care Patient Protection Act of 2018 (HR
    5858)--a bipartisan bill to make it more affordable for patients with
    HDHPs to access primary care.
    ---------------------------------------------------------------------------
        \12\ https://www.aafp.org/dam/AAFP/documents/events/fmas/BKG-
    StandardPrimaryCare
    BenefitHighDeductiplePlans.pdf.

        Ensuring connectivity to a health-care delivery system through
    continuous, comprehensive, primary care is not only solid health
    policy; it also is sound economic policy for individuals and employers.
    A recent study \13\ conducted by the University of Portland found that
    every $1 invested in advanced primary care practices resulted in $13 in
    savings in other health-care services, including specialty, emergency
    room, and inpatient care.
    ---------------------------------------------------------------------------
        \13\ https://www.oregon.gov/oha/hpa/dsi-pcpch/Pages/index.aspx.

        When patients delay primary or preventive medical care, they often
    end up in an emergency room. According to a poll \14\ conducted by the
    American College of Emergency Physicians, about 80 percent of emergency
    physicians said they are treating insured patients who have sacrificed
    or delayed medical care due to unaffordable out-of-pocket costs,
    coinsurance, or high deductibles. A 2013 study \15\ found that high-
    deductible health plans (HDHPs) led to decreased adherence to
    pharmaceutical treatments for patients with chronic conditions. The
    decrease in pharmaceutical adherence contributes to poor control of
    chronic conditions, which leads to the probability of more intensive
    and expensive health-care treatments at some future date.
    ---------------------------------------------------------------------------
        \14\ https://www.acep.org/uploadedFiles/ACEP/advocacy/
    ACEP%20Fair%20Coverage%20
    Report.pdf.
        \15\ https://www.ajmc.com/journals/issue/2013/2013-1-vol19-n12/
    medication-utilization-and-adherence-in-a-health-savings-
    accounteligible-plan.

        These findings further support the need to ensure individuals have
    connectivity with the health-care system through a constant
    relationship with a primary care physician. The cost of not ensuring
    continuous primary care is substantial. For example, the average cost
    of a visit to a primary care physician is $160.\16\ By comparison, the
    median charge for outpatient conditions in the emergency room is $1,233
    \17\ and the average hospital stay is $10,000.\18\ Based on these
    indicators, patients could see their primary care physician 7.7 times
    for the cost of a single visit to the emergency room and 62.5 times for
    a single hospital admission. Furthermore, it is estimated that more
    than $18 billion \19\ could be saved annually if those patients whose
    medical problems are considered ``avoidable'' or ``non-urgent'' were to
    take advantage of primary or preventive health care and not rely on
    emergency rooms for their medical needs. Primary care physicians are in
    the best position to serve as a patient's ``chronic care point guard''
    and provide the quality and longitudinal care that can improve patient
    outcomes and reduce downstream costs.
    ---------------------------------------------------------------------------
        \16\ https://www.jhsph.edu/news/news-releases/2015/primary-care-
    visits-available-to-most-uninsured-but-at-a-high-price.html.
        \17\ https://journals.plos.org/plosone/article?id=10.1371/
    journal.pone.0055491.
        \18\ https://www.hcup-us.ahrq.gov/reports/statbriefs/sb168-
    Hospital-Costs-United-States-2011.pdf.
        \19\ https://www.debt.org/medical/emergency-room-urgent-care-
    costs/.

        It is well known that the United States, as compared to other
    Organisation for Economic Co-operation and Development (OECD)
    countries, spends a greater percentage of the gross domestic product on
    health care, yet has a significantly lower life expectancy. Many
    researchers have pointed to various reasons why this occurs in the
    United States, but one common finding is the fact that the United
    States spends far less on primary care and prevention than other OECD
    countries. Currently, the United States spends about 6 percent of its
    total health-care resources on primary care. By comparison, the United
    States spends 27 percent on inpatient hospitalization, 28 percent on
    outpatient hospital services, 30 percent on non-
    primary care professional procedures, and 16 percent on
    pharmaceuticals.
                        development of metrics in macra
        Question. I have heard from a number of physicians who believe that
    there is no link between many of the MIPS measures they are required to
    report and improving clinical care for their patients. I understand
    that the physician community has engaged with CMS to try and make the
    program more meaningful to physicians and patients through more
    relevant quality measures.

        How are clinicians from your organization involved the creation of
    these measures relevant to their specialties?

        Answer. The AAFP is participating in several CMS efforts to align
    measures and make measurement more meaningful, including the Core
    Quality Measures Collaborative, the Measures Application Partnership,
    the National Quality Forum, and efforts by measure developers to design
    measures applicable to primary care.

        Current measures of primary care are scattered across all diseases,
    conditions, and preventive needs of patients; are generally
    indistinguishable from measures of other specialties; and do not
    adequately assess the quality of primary care. Primary care is much
    more complex than many people understand. Three out of four complaints
    that present are self-limited, and 40 percent of new symptoms do not
    lend themselves to any current coding system (e.g., ICPC, ICD-10). In
    addition, the linear ``assembly line'' model that has resulted in some
    advances (e.g., ventilator care) is not appropriate in primary care.
    Primary care requires a whole-person approach, prioritization of needs,
    a sophisticated primary care team, and consideration of the goals of
    the patient within the context of his or her social system. Additional
    research is needed on how primary care is delivered and how to improve
    and measure care in the primary care setting.

        The AAFP is supportive of research, measure development, and
    measure testing being conducted by the Robert Graham Center and the VCU
    School of Medicine to develop meaningful measures of primary care,
    including measures of continuity, comprehensiveness, and the patient-
    centered primary care measure.

        Question. Has CMS been receptive to your feedback when provided?

        How would you assess CMS's collaboration on achieving meaningful
    metrics?

        Answer. CMS along with other payers are collaborating with the Core
    Quality Measures Collaborative, but to date, implementation and
    acceptance by all payers is limited. Performance measures continue to
    be churned-out at high quantity by many organizations and remain
    unaligned and unfocused on the most important factors that impact
    health, health care, and costs, and administrative burden of reporting
    remains unacceptably high.

        Question. Are there any changes in this process you would
    recommend?

        Answer. Eliminate self-reporting of performance measures and rely
    on measures that are extracted from other sources. Please see
    discussion provided earlier. CMS could consider measuring care at a
    geographic area and attributing the measure result to all providers who
    treat patients from the area as a factor in their overall measure score
    (hospitals, clinics, individual physicians, subspecialists, CAH, RHC,
    etc.). Performance metrics derived from existing data sources that are
    most impactful should be calculated and applied as one factor of
    performance to all (e.g., measures of access, SDoH, costs, and other
    factors that have a large impact on health of a population). This would
    support the need for addressing health/health-care needs and costs at
    the system level and reduce silos of care.

        Any single provider, facility, or patient might rightfully belong
    to multiple systems. For greatest impact, all populations and
    geographic areas must be attributed to one or more systems and all
    providers must be included in one or more systems, regardless of
    whether formal arrangements are in place. This is necessary to address
    issues of inequity, access, and cherry-picking, and would ensure that
    someone is responsible for the health, health care, and costs of all
    defined populations. Entities and health-care professionals could find
    themselves in overlapping systems with a competitor, which would
    encourage cooperation and mutual resource allocation to improve factors
    that influence health outcomes. Holding systems responsible for serving
    the needs of a geographic population may prevent the closure of
    clinics, EDs, maternity services, and other essential services in rural
    areas.

                                     ______

                 Questions Submitted by Hon. Sheldon Whitehouse
        Question. Accountable Care Organizations (ACOs) have the potential
    to transform our health care delivery system. While we've seen ACOs
    improve patient care and create shared savings, many provider-led ACOs
    only control a small fraction of total spending, with specialists,
    pharmaceuticals, and hospitals accounting for most of it. This leads to
    ACOs lacking sufficient leverage to bring down costs and can contribute
    to shared losses.

        How can we improve the ACO model to account for this imbalance? How
    can we support successful ACOs and encourage more providers to follow
    their lead?

        Answer. The AAFP supports the creation of more APMs for practices
    of all sizes to participate. We recommended that policymakers increase
    the glide path for new, low-revenue ACOs in the one-sided levels of the
    BASIC track to 3 years. This is supported by a recent study published
    by the New England Journal of Medicine, which found that, after 3 years
    in the MSSP, physician-led ACOs were able to generate shared savings
    that grew over the study period. It is imperative to allow ACOs,
    particularly physician-led and low-revenue ACOs, enough time to
    generate sufficient shared savings to offset startup costs and support
    sustained transformation.

        We also encourage policymakers to maintain the shared savings rate
    at 50 percent for BASIC Levels A-D. We believe that a higher shared
    savings rate is necessary to support ACOs--especially physician-led and
    low-revenue ACOs with more limited capital reserves--in their efforts
    to improve quality and decrease costs.

        Question. Our health-care system is not fully equipped to care for
    an aging population and patients with advanced illness such as late-
    stage cancer, Alzheimer's disease or dementia, or congestive heart
    failure. This is an area where we need new models of care that reflect
    these challenges and create a better system for providers, patients,
    and their families. Many of our current Medicare rules in this space
    are counterproductive, such as requiring a two night, three-day stay in
    an inpatient facility to qualify for skilled nursing care, and various
    disincentives to providing respite or palliative care. How are your
    organizations innovating to provide care for these patients, and what
    can Congress and CMS do to support those efforts?

        Answer. The AAFP encourages CMS to continue waivers from its
    previous and existing programs, such as the SNF 3-day, telehealth, and
    home visit waivers. Additionally, CMS should work with Congress to
    create copay waivers. By waiving copays, practices would have more
    freedom to invest in primary care. Further, copays can often create
    barriers for beneficiaries to receive appropriate care and add
    administrative burden to practices as they try to collect copays. A
    copay waiver would reduce this administrative burden and encourage
    beneficiaries to seek the comprehensive and coordinated care provided
    by primary care physicians. Receiving timely, preventive care from
    primary care physicians is vital to improving the health of
    beneficiaries.

        Question. Despite continued investment, electronic health records
    (EHRs) remain difficult to share, challenging for patients to access,
    and a source of frustration to providers and policymakers alike. The
    business models of the EHR venders often leads to perverse incentives
    against sharing patient information.

        What steps can Congress take to make EHRs work better for
    providers? Are the proposed data blocking rules enough to start
    encouraging better data sharing by the vendors?

        Answer. Electronic health records (EHRs) continue to pose
    significant challenges for all physicians and clinicians but especially
    for small and rural practices.\20\ With fewer resources available, some
    rural practices use less expensive EHRs that have limited capabilities,
    which can make interoperability significantly more difficult.
    Additionally, EHRs often lack adequate technical support or may charge
    for providing basic user support. CMS' mandate to implement 2015
    Edition certified EHR technology requires additional financial
    investments and staff support further inflate the barriers to
    successful value-based payment participation for rural practices. The
    AAFP welcomes the opportunity to partner with the committee as it
    considers ways to boost clinically meaningful HIT use among small
    practices.
    ---------------------------------------------------------------------------
        \20\ https://www.gao.gov/assets/700/692179.pdf.

        The proposed data blocking rules are insufficient to better
    encourage data sharing by vendors. We encourage Senators to review the
    AAFP's response to HHS regarding the Interoperability and Patient
    Access proposed rule. The comment letter \21\ expressed concern with
    proposed changes to drive the adoption of Application Programming
    Interfaces and trusted exchange within the health plan community--
    specifically, the requirement to make data available in one business
    day, and the recommendation that health plans amend contracts with
    physicians to require nearly real-time data submission, which would
    increase administrative burden on physicians. We also encourage
    Senators to review the AAFP's letter \22\ on the proposed rule
    regarding interoperability and information blocking. The letter
    cautioned that the proposed framework would add unnecessary complexity
    and uncertainty for family physicians. The AAFP urged HHS to simplify
    the rules with small and medium-sized physician practices in mind.
    ---------------------------------------------------------------------------
        \21\ https://www.aafp.org/dam/AAFP/documents/advocacy/health_it/
    emr/LT-HHS-Interoperability-060319.pdf.
        \22\ https://www.aafp.org/dam/AAFP/documents/advocacy/health_it/
    emr/LT-ONC-InfoBlock
    ing060319.pdf.

        Question. How can we encourage States to be better innovators on
    health-care spending? The current Medicaid waivers incentivize States
    to keep costs down, but are there ways to encourage both lower costs
    ---------------------------------------------------------------------------
    and better health-care outcomes?

        Answer. Congress could encourage States to be better innovators on
    health-care spending and promote the adoption of APMs by addressing low
    Medicaid physician payment rates which have historically created a
    barrier to health-care access for Medicaid enrollees. AAFP policy \23\
    supports Medicaid payment for primary care services at least equal to
    Medicare's payment rate for those services when provided by a primary
    care physician. Accordingly, we urge Congress to resume Federal primary
    care payment policy previously found in Medicaid--SSA 1902(a)(13)(C)
    and provide Federal funding to ensure a floor of Medicare payment rates
    for primary-care services in Medicaid.
    ---------------------------------------------------------------------------
        \23\ https://www.aafp.org/about/policies/all/medicaid-
    principles.html.

                                     ______

                   Questions Submitted by Hon. Maggie Hassan
        Question. We spoke during the hearing about the incentive payment
    for providers to improve tracking and reporting of opioid prescribing,
    treatment agreements,
    follow-up evaluations, and screening of patients who may be at risk of
    opioid misuse under the Medicare Access and Children's Health Insurance
    Program (CHIP) Reauthorization Act of 2015 (MACRA).

        This data has the potential to improve treatment for substance use
    disorder, which is why its collection and reporting is now incentivized
    through increased reimbursement.

        At the hearing, I asked for feedback on the impact this data
    collection and reporting has had on treatment of patients, particularly
    as it relates to any reduction in opioid misuse.

        Based on your response, it seems that there may be additional steps
    the Centers for Medicare and Medicaid Services (CMS) could take so that
    this aggregated, de-identified data can be used to benefit patients and
    improve care.

        Do you have specific suggestions on how CMS can improve the
    collection, use, and dissemination of opioid prescribing and treatment
    data sets in ways that would directly benefit patients at their site of
    care, specifically as it relates to identifying best practices to
    reduce opioid misuse?

        Answer. In the AAFP's ``Chronic Pain Management and Opioid Misuse''
    position paper,\24\ we call on family physicians to use protocols for
    MAT to address opioid dependence within the clinic population. MAT for
    opioid and heroin dependence has existed for more than 5 decades and
    involves some form of opioid substitution treatment. Originally, only
    methadone (an opioid agonist) was available, but now clinicians have
    buprenorphine (a partial agonist used alone or in combination with
    naloxone) and naltrexone (an opioid antagonist with both oral and
    extended-release injectable formulations) as pharmacologic options for
    MAT. In addition, adjunctive medications such as clonidine,
    nonsteroidal anti-inflammatory medications (NSAIDs), and others are
    used in the treatment of specific opioid withdrawal symptoms.
    ---------------------------------------------------------------------------
        \24\ https://www.aafp.org/about/policies/all/pain-management-
    opioid.html.

        With the increase in opioid misuse, various Federal and State
    authorities and professional organizations have produced guidelines to
    help providers best treat opioid use disorders. The AAFP encourages HHS
    to consult these resources and work toward a nationwide, comprehensive
    ---------------------------------------------------------------------------
    coverage of drugs used in MAT.

        We applaud policymakers for encouraging health insurance plans to
    provide comprehensive coverage of MAT, opioid misuse and addiction is a
    serious national crisis. The AAFP calls for required, comprehensive
    coverage of MAT and counseling as recommended by the FDA in all public
    and private health insurance plans. Furthermore, the AAFP advocates
    against limits on MAT duration. Both FDA and SAMHSA state that
    treatment with MAT may be life-long, and we urge policymakers to factor
    that into MAT coverage policies.

                                     ______

               Questions Submitted by Hon. Catherine Cortez Masto
        Question. Nevada has one of the most significant health-care
    workforce shortages in the country. What kind of impact is MACRA having
    on the physician workforce? Are there ways to leverage the law to build
    that work force?

        Answer. By moving Medicare payments away from fee-for-service,
    MACRA has a positive impact on those physicians that are able to
    participate in an APM. However, participation in MIPS continues to be
    burdensome and problematic for small and rural practices. Congress
    should encourage the proliferation of appropriate APMs to increase the
    physician workforce.

        Question. MACRA included $20 million per year through 2020 to
    support the administration of technical assistance to help small and
    rural practices comply with the law's reporting requirements. Almost
    $35 million will be left as of this coming January, to remain available
    until expended. As a contractor, can you explain the process of
    developing technical assistance?

        Answer. The AAFP was not a contractor and did not develop technical
    assistance. Instead, we promoted the SURS to our members for their
    information. Congress provided technical assistance funds for CMS to
    support practices in MIPS. CMS created the Small, Rural, and
    Underserved Support (SURS). While these organizations have been
    helpful, they are unable to provide the in-depth and individualized
    support many small and rural practices need. The services provided \25\
    vary by each organization and may not be available to all practices.
    Additionally, the organizations can provide technical support, but they
    do not provide any financial or permanent human resources for
    practices. Stakeholders interviewed for a recent RAND report \26\ felt
    the QPP support is able to provide high-level support, but much of the
    work cannot be done by outside contractors or office managers.
    Stakeholders also reported that the support providers sometimes lacked
    knowledge in certain areas or were unable to get answers from CMS to
    specific questions. Specifically, funds are needed to pay for IT
    support specific to individual users. Technical assistance providers
    lack specific IT knowledge and funds to implement real solutions.
    ---------------------------------------------------------------------------
        \25\ https://www.gao.gov/assets/690/681541.pdf.
        \26\ https://www.rand.org/content/dam/rand/pubs/research_reports/
    RR2800/RR2882/RAND
    _RR2882.pdf.

        Second, the AAFP would recommend the exceptional performance bonus
    payments be reimagined to reward practices that achieve significant
    year-over-year improvement versus rewarding those practices at the
    upper levels of annual performance. While we applaud these high-
    performing practices, it is our belief that additional positive payment
    adjustments would be better used if they were focused on rewarding the
    ---------------------------------------------------------------------------
    hard work of practices that achieve year-over-year improvements.

                                     ______

      Prepared Statement of Matthew Fiedler, Ph.D., Fellow, USC-Brookings
         Schaeffer Initiative for Health Policy, Brookings Institution
        Chairman Grassley, Ranking Member Wyden, members of the Finance
    Committee, thank you for the opportunity to testify today. My name is
    Matthew Fiedler, and I am a fellow with the USC-Brookings Schaeffer
    Initiative for Health Policy, where my research focuses on a range of
    topics in health care economics and health care policy, including
    provider payment policy. Previously, I served as Chief Economist on the
    staff of the Council of Economic Advisers, where I provided economic
    advice on a range of health care policy issues. This testimony reflects
    my personal views and should not be attributed to the staff, officers,
    or trustees of the Brookings Institution.

        I am honored to have the opportunity to speak with you about
    implementation of the Medicare physician payment provisions of the
    Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).\1\ My
    testimony makes four main points:
    ---------------------------------------------------------------------------
        \1\ Many of the ideas discussed here were developed in joint work
    with several colleagues. See Fiedler, Matthew, Tim Gronniger, Paul B.
    Ginsburg, Kavita Patel, Loren Adler, and Margaret Darling. 2018.
    ``Congress Should Replace Medicare's Merit-Based Incentive Payment
    System.'' Health Affairs Blog. https://www.healthaffairs.org/do/
    10.1377/hblog20180222.35120/full/. Any errors are my own.

            1.  Research examining the structure of the Merit-based
            Incentive Payment System (MIPS) and experience with similar
            programs suggest that MIPS is unlikely to improve the quality
            or efficiency of patient care. But MIPS is creating substantial
    ---------------------------------------------------------------------------
            administrative costs.

            2.  MACRA's bonus payments for clinicians participating in
            Advanced Alternative Payment Models (APMs) have great potential
            to increase participation in these models, which recent
            research has shown can reduce health care spending while
            maintaining or improving quality. Consistent with this
            potential, implementation of the bonus has coincided with--and
            likely helped cause--greater participation in advanced APMs,
            while also encouraging the Centers for Medicare and Medicaid
            Services (CMS) to deploy more effective APMs.

            3.  Policy-makers should build on what is working in MACRA and
            discard what is not by increasing the size of MACRA's
            incentives for participation in Advanced APMs, creating similar
            incentives for other categories of providers, and eliminating
            MIPS.

            4.  In the absence of broader changes to MACRA, several
            narrower reforms are worth considering. These include making
            the advanced APM bonus permanent, eliminating the ``cliff'' in
            the Advanced APM bonus eligibility rules, standardizing the
            measures used in the MIPS quality category, and replacing the
            MIPS practice improvement and promoting interoperability
            categories with more targeted incentives.
                              background on macra
        In addition to reauthorizing the Children's Health Insurance
    Program and repealing the sustainable growth rate formula that
    determined the overall level of Medicare's physician payment rates,
    MACRA made important structural changes to how Medicare pays
    physicians. Under MACRA, clinicians choose between two tracks: (1)
    participating in MIPS; and (2) participating in an Advanced APM.

        Most clinicians are currently participating in MIPS, which adjusts
    clinicians' payment rates upward or downward based on their performance
    in four categories: (1) quality of care; (2) cost of care; (3)
    completion of specified ``practice improvement'' activities; and (4)
    use of certified electronic health records (EHRs), now called the
    Promoting Interoperability category by CMS. In the quality and practice
    improvement categories, clinicians have broad flexibility to select the
    measures or activities they are evaluated on. With the exception of the
    cost category, clinicians are generally responsible for collecting the
    information used to evaluate their performance and submitting that
    information to CMS. The first ``performance year'' under MIPS was 2017;
    payment adjustments for the 2017 performance year are occurring during
    2019.

        Clinicians are permitted to opt out of MIPS if they participate to
    a sufficient degree in an Advanced APM, as measured by the share of a
    clinician's payments or patient volume connected with an Advanced
    APM.\2\ Importantly, clinicians with sufficient participation in
    Advanced APMs are also eligible for a bonus payment equal to 5 percent
    of their physician fee schedule revenue. Paralleling MIPS, the first
    performance year for the Advanced APM bonus was 2017, and the first
    bonus payments are occurring in 2019. The bonus for Advanced APM
    participation will expire after the 2022 performance year.\3\
    ---------------------------------------------------------------------------
        \2\ For the current performance year, a clinician must serve at
    least 35 percent of its patients or receive at least 50 percent of its
    payments in connection with an Advanced APM. For 2021 and later
    performance years, those thresholds rise to 50 percent and 75 percent,
    respectively. Clinicians with somewhat lesser engagement with Advanced
    APMs are eligible to opt out of MIPS but are not eligible for bonus
    payments.
        \3\ MACRA provides that payment rates for clinicians participating
    in Advanced APMs will grow 0.5 percentage points per year more quickly
    than those for non-participants starting with the 2024 performance
    year, which will gradually re-create an incentive for participation in
    Advanced APMs. However, it will take more than a decade after 2022
    before incentives for participation in Advanced APMs return to the
    level of the current bonus.

        To be considered an Advanced APM, a payment model must make
    participants financially liable if spending exceeds an expected level.
    Advanced APMs must also must base payment in part on participants'
    quality performance and require participants to use an EHR that meets
    the certification criteria promulgated by the Department of Health and
    Human Services (HHS). The most prominent examples of Advanced APMs are
    Accountable Care Organization (ACO) models that include ``two-sided''
    risk (that is, ACO models that require participants to bear a portion
    of the costs if spending by their beneficiaries exceeds the
    ``benchmark'' spending level under the model). However, some episode
    (or ``bundled'') payment models, as well as some medical home models,
    also qualify as Advanced APMs.
          mips appears unlikely to meaningfully improve patient care,
                             but is creating burden
        There is limited direct evidence on MIPS's effects to date because
    data on the program's first year were only recently released and
    because decisions CMS made to ease the transition to MIPS make this
    early experience a poor guide to how MIPS will perform in the long run.
    However, analyses of MIPS's structure, as well as research examining
    prior similar programs, suggest that MIPS is unlikely to achieve its
    goals of reducing costs or improving quality. Nevertheless, MIPS is
    creating significant administrative costs for providers.
    Structural Problems Limit MIPS's Ability to Improve the Quality or
            Efficiency of Patient Care
        MIPS has several structural problems that limit the program's
    ability to improve the quality or efficiency of the care Medicare
    beneficiaries receive. I focus on three that are particularly
    significant. Other experts and the Medicare Payment Advisory Commission
    (MedPAC) have expressed similar concerns about MIPS's architecture.\4\
    ---------------------------------------------------------------------------
        \4\ See, for example, Schneider, Eric C. and Cornelia J. Hall.
    2017. ``Improve Quality, Control Spending, Maintain Access--Can the
    Merit-based Incentive Payment System Deliver?'' New England Journal of
    Medicine 376(8): 708-710; Medicare Payment Advisory Commission. 2018.
    ``Moving Beyond the Merit-based Incentive Payment System.'' http://
    www.medpac.gov/docs/default-source/reports/
    mar18_medpac_ch15_sec.pdf?sfvrsn=0; Rathi, Vinay K. and J. Michael
    McWilliams. 2019 ``First-Year Report Cards From the Merit-Based
    Incentive Payment System (MIPS): What Will Be Learned and What Next?''
    Journal of the American Medical Association.
    ---------------------------------------------------------------------------
    Problem #1: Orienting Payment Incentives Around Clinicians, Rather Than
            Patients
        MIPS aims to improve the quality and efficiency of patient care by
    adjusting payments for individual clinicians or practices. But a given
    patient's care often involves multiple different clinicians, each
    playing a different role. Ensuring that the payment incentives MIPS
    creates for individual clinicians or practices add up to a coherent set
    of incentives for the management of each patient's care is at best
    difficult and, as a practical matter, probably impossible.

        For example, under the MIPS cost category as currently implemented,
    the need to measure cost performance at the clinician or practice level
    has led CMS to create multiple different cost measures, score each
    clinician or practice on all measures for which minimum sample size
    requirements are met, and then compute a final category score as an
    equally weighted average of the scored measures. This approach creates
    an unpredictable and haphazard overall set of incentives to reduce
    spending since a given dollar of spending may factor into zero, one, or
    more than one of the cost measures that end up being scored for any
    given provider.
    Problem #2: Limited Panel Sizes at the Practice Level
        It is difficult to reliably measure cost or quality performance at
    the level of an individual clinician or practice because of the
    relatively small number of Medicare beneficiaries involved. This
    problem is particularly acute when measuring cost performance since
    health care spending varies so widely across individuals. As a result,
    at least once MIPS is fully implemented, chance will play a large role
    in determining where a clinician falls on the spectrum of possible
    payment adjustments under MIPS, which weakens the incentives those
    payment adjustments create for clinicians to improve performance.
    Incentives could, of course, be strengthened by making the MIPS payment
    adjustments larger, but clinicians would have legitimate concerns about
    basing large payment adjustments on performance measures influenced so
    strongly by random chance.
    Problem #3: Clinician Choice of Quality Measures
        Clinicians' ability to choose the quality measures they are
    evaluated on undermines the effectiveness of the MIPS quality category.
    Allowing clinicians to choose quality measures was a well-intended
    effort to allow clinicians to tailor the measures they report to the
    nature of the care they provide. However, the lack of common measures
    makes comparing the performance of different clinicians--even
    clinicians providing similar services--difficult or impossible. That,
    in turn, makes it hard to determine which clinicians are, in fact, high
    or low performers for the purposes of MIPS payment adjustments. The
    lack of common measures will also make it difficult or impossible for
    patients to use the data generated by MIPS to compare providers.

        Allowing choice also creates strong incentives for clinicians to
    selectively report quality measures on which they perform well while
    declining to report measures on which they perform poorly. Indeed, due
    to the financial stakes under MIPS, it is hard for clinicians to avoid
    doing this, even if that would be their preference. This type of
    selective reporting causes the data collected under MIPS to provide a
    skewed picture of each clinician's performance, making it even more
    difficult for patients or CMS to use the data to evaluate clinicians.
    These incentives for selective reporting likely also increase
    administrative costs by requiring providers to invest time and effort
    (or hire consultants) to identify the measures they are likely to
    perform best on, or, alternatively, to collect data on many more
    measures than they are required to report and submit only the best
    ones.

        The MIPS practice improvement activities category suffers from
    similar problems. Practices are permitted to select from a list of more
    than 100 practice improvement activities and can achieve a maximum
    score by completing at most four (and sometimes fewer) activities.\5\
    The list is sufficiently broad that, at least in many instances,
    clinicians can achieve the maximum score for the practice improvement
    category by reporting on activities that they had already planned to
    complete. In those instances, the practice improvement category creates
    reporting costs for providers, but no benefit to patients. Even when
    the category does induce providers to take action they would not
    otherwise have taken, the benefit to patients is uncertain. While many
    of the included activities are at least superficially appealing, the
    evidence base supporting them is not always clear, nor is it clear that
    the level of engagement with these activities required to gain credit
    under MIPS is sufficient to generate meaningful changes in care.
    ---------------------------------------------------------------------------
        \5\ Practice improvement activities include items like reporting to
    clinical registries, conducting a survey on patient satisfaction,
    participating in specific trainings, or integrating recommended
    clinician screenings into routine practice.
    ---------------------------------------------------------------------------
    Research on Programs Similar to MIPS Has Found Discouraging Results
        MIPS is not the first instance in which Medicare has sought to
    improve the quality or reduce the cost of patient care by adjusting
    providers' fee-for-service payment rates upward or downward based on
    performance on a broad set of cost and quality measures. Research on
    these similar programs has found little evidence that such programs
    have achieved their objectives, and there is little reason to believe
    that a different result should be expected under MIPS.

        A recent study examining the Value-Based Payment Modifier (Value
    Modifier), a predecessor to MIPS that adjusted Medicare payment rates
    for physician groups based on cost and quality performance, provides
    particularly relevant and compelling evidence.\6\ This research draws
    on the fact that practices with 100 or more clinicians could receive
    either bonuses or penalties under the Value Modifier, while practices
    with between 10 and 99 clinicians could receive only bonuses and
    smaller practices were excluded entirely. The researchers were thus
    able to isolate the effect of the Value Modifier by looking for sharp
    changes in cost or quality performance at these practice size
    thresholds. The authors found no evidence that the Value Modifier had
    any effect on potentially avoidable hospitalizations, hospital
    readmissions, Medicare spending, or mortality.
    ---------------------------------------------------------------------------
        \6\ Roberts, Eric T., Alan M. Zaslavsky, and J. Michael McWilliams.
    2018. ``The Value-Based Payment Modifier: Program Outcomes and
    Implications for Disparities.'' Annals of Internal Medicine 168(4):
    255-265.

        Research examining the Hospital Value-Based Purchasing Program
    (HVBP), which adjusts Medicare hospital payments upward and downward
    based on a similarly broad set of measures, has reached similar
    discouraging conclusions.\7\ The same is true of research on the
    Premier Hospital Demonstration, a demonstration project that was a
    predecessor of the HVBP.\8\ It is notable that these hospital-
    focused programs avoid at least some of MIPS's shortcomings since most
    hospitals have much higher patient volumes than individual clinicians
    or practices and these programs do not allow hospitals to choose which
    measures they are evaluated on.
    ---------------------------------------------------------------------------
        \7\ Ryan, Andrew M., Sam Krinsky, Kristin A. Maurer, and Justin B.
    Dimick. 2017. ``Changes in Hospital Quality Associated With Hospital
    Value-Based Purchasing.'' New England Journal of Medicine 376(24):
    2358-2366; Figueroa, Jose F., Yusuke Tsugawa, Jie Zheng, E. John Orav,
    and Ashish K. Jha. 2016. ``Association between the Value-Based
    Purchasing pay for performance program and patient mortality in US
    hospitals: observational study.'' British Medical Journal 353: i2214.
        \8\ Jha, Ashish K., Karen E. Joynt, E. John Orav, and Arnold M.
    Epstein. 2012. ``The Long-Term Effect of Premier Pay for Performance on
    Patient Outcomes.'' New England Journal of Medicine 366(17): 1605-1615.

        Before proceeding, I note two caveats on this evidence. First, the
    estimates from these studies are subject to some uncertainty. Thus,
    while this evidence largely rules out the possibility that these
    programs caused large improvements in patient care, these programs
    could have caused smaller improvements in patient care that these
    ---------------------------------------------------------------------------
    studies were unable to detect.

        Second, this evidence should not be interpreted as showing that
    adjusting payments based on particular outcomes within a fee-for-
    service structure can never be successful. Notably, research on the
    Hospital Readmission Reduction Program (HRRP), which penalizes
    hospitals at which a large share of patients are readmitted soon after
    discharge finds that it substantially reduced hospital readmission
    rates.\9\ Moreover, while there has been some recent controversy on
    this point, there is, in my view, some evidence that the HRRP reduced
    post-discharge mortality rates and no compelling evidence that the HRRP
    increased mortality.\10\ One plausible explanation for why the HRRP has
    been more successful than the Value Modifier or HVBP is that the HRRP
    is a much more targeted program that attaches relatively strong
    incentives to a narrow set of outcomes.
    ---------------------------------------------------------------------------
        \9\ Zuckerman, Rachael B., Steven H. Sheingold, E. John Orav, Joel
    Ruhter, and Arnold M. Epstein. 2016. ``Readmissions, Observation, and
    the Hospital Readmission Reduction Program.'' New England Journal of
    Medicine 374: 1543-1551; Medicare Payment Advisory Commission. 2018.
    ``Mandated report: The effects of the Hospital Readmissions Reduction
    Program.'' http://www.medpac.gov/docs/default-source/reports/
    jun18_ch1_medpacreport_sec.pdf; Atul Gupta. 2017. ``Impact of
    performance pay for hospitals: The Readmissions Reduction Program.''
    Working Paper. https://www.dropbox.com/s/rfwok9en2c5812j/
    Gupta_HRRP.pdf.
        \10\ Ibid.
    ---------------------------------------------------------------------------
    Providers Incur Significant Costs to Comply With MIPS
        While MIPS, at least in its current form, appears unlikely to
    substantially improve patient care, it is creating substantial
    compliance costs. For the 2019 performance year, CMS estimates that
    providers will incur $482 million in reporting costs related to MIPS,
    with the MIPS quality category accounting for the majority of those
    costs.\11\ Notably, this figure does not include the costs providers
    incur to develop a strategy for complying with MIPS, including deciding
    which quality measures it is most advantageous to collect and report.
    These activities are likely to require providers to invest substantial
    staff time, hire outside consultants, or both.
    ---------------------------------------------------------------------------
        \11\ See Table 91 in Centers for Medicare and Medicaid Services.
    2018. ``Medicare Program; Revisions to Payment Policies Under the
    Physician Fee Schedule and Other Revisions to Part B for CY 2019.''
    Federal Register 83(226): 59452. https://www.govinfo.gov/content/pkg/
    FR-2018-11-23/pdf/2018-24170.pdf.

        Of course, the fact that complying with MIPS creates administrative
    costs is not, in itself, evidence of a problem. If MIPS was improving
    the quality or efficiency of patient care, then these costs could be
    worth incurring. Indeed, the $482 million in estimated reporting costs
    cited above constitute only around 0.5 percent of projected spending on
    services under the physician fee schedule during 2019, so even modest
    improvements in care could suffice. But it is hard to justify requiring
    clinicians to incur these costs in service of an ineffective program.
            research finds apms can be effective, and participation
                           in advanced apms is rising
        While I am pessimistic about MIPS, I am optimistic about MACRA's
    bonus payments for participation in Advanced APMs. Recent research has
    shown that well-designed APMs can reduce health-care spending while
    maintaining or improving quality. Furthermore, implementation of
    MACRA's bonus payments has coincided with--and likely helped cause--an
    increase in participation in these models, while also facilitating the
    deployment of more effective APMs.
    Evidence on APMs' Effectiveness
        Recent research indicates that APMs can be effective tools for
    reducing health-care spending. I focus on the evidence on ACO models
    since they account for the large majority of participation in APMs and
    advanced APMs in Medicare. The best such research has focused on the
    Medicare Shared Savings Program (MSSP), which is by far the largest
    Medicare ACO program.\12\ This research has found that MSSP ACOs reduce
    average spending per beneficiary by between 0 and 5 percent, with the
    size of the spending reduction depending on an ACO's composition and
    how long it has participated in the MSSP. On average, physician-group
    ACOs that have a few years of experience in the MSSP have performed at
    the high end of this range, while ACOs containing a hospital have
    performed at the low end of this range. Research examining the Center
    for Medicare and Medicaid Innovation's Pioneer ACO model has also found
    evidence that the model reduced spending, as has research examining a
    commercial ACO-like contract operated by Blue Cross Blue Shield of
    Massachusetts.\13\
    ---------------------------------------------------------------------------
        \12\ McWilliams, J. Michael, Laura A. Hatfield, Bruce E. Landon,
    Pasha Hamed, and Michael E. Chernew. 2018 ``Medicare Spending After 3
    Years of the Medicare Shared Savings Program.'' New England Journal of
    Medicine 379(12): 1139-1149.
        \13\ McWilliams, J. Michael, Michael E. Chernew, Bruce E. Landon,
    and Aaron L. Schwartz. 2015. ``Performance Differences in Year 1 of
    Pioneer Accountable Care Organizations.'' New England Journal of
    Medicine 372(20): 1927-1936; Nyweide, David J., Woolton Lee, Timothy T.
    Cuerdon, Hoangmai H. Pham, Megan Cox, Rahul Rajkumar, Patrick H.
    Conway. 2015. ``Association of Pioneer Accountable Care Organizations
    vs Traditional Medicare Fee for Service With Spending, Utilization, and
    Patient Experience.'' Journal of the American Medical Association
    313(21): 2152-2161; Song, Zirui, Sherri Rose, Dana G. Safran, Bruce E.
    Landon, Matthew P. Day, and Michael E. Chernew. 2014. ``Changes in
    Health Care Spending and Quality 4 Years Into Global Payment.'' New
    England Journal of Medicine 371(18): 1704-14.

        For a few reasons, I suspect these findings may understate the
    overall savings that should be expected from ACO models, at least over
    the long run. First, the research cited above provides some evidence
    that providers perform better in these models as they gain experience.
    Second, the research on MSSP examines years in which essentially all
    ACOs were participating in one-sided models under the program's
    original benchmarking methodology; as discussed below, CMS has made
    changes in both these areas that will likely cause MSSP ACOs to have
    stronger incentives to reduce spending in the future than they have in
    the past. Third, these models may reduce spending through a variety of
    channels that were not examined in these studies. Most directly,
    reductions in traditional Medicare spending reduce payments to plans
    under the Medicare Advantage program.\14\ Medicare's deployment of
    these models also appears to have coincided with--and plausibly helped
    cause--increased use of these models by private insurers.\15\ Providers
    participating in ACOs may also change the way they treat patients
    covered by other payers or play a role in reshaping the practice norms
    adhered to by other providers.\16\
    ---------------------------------------------------------------------------
        \14\ Centers for Medicare and Medicaid Services. 2018. ``Medicare
    Program; Medicare Shared Savings Program; Accountable Care
    Organizations--Pathways to Success and Extreme and Uncontrollable
    Circumstances Policies for Performance Year 2017.'' Federal Register
    83(249): 67816; McWilliams, J. Michael. 2016. ``Savings From ACOs--
    Building on Early Success.'' Annals of Internal Medicine 165(12): 873-
    875.
        \15\ Muhlestein, David, Robert S. Saunders, Robert Richards, and
    Mark B. McClellan. 2018. ``Recent Progress in the Value Journey: Growth
    of ACOs and Value-Based Payment Models in 2018.'' Health Affairs Blog.
    https://www.healthaffairs.org/do/10.1377/hblog20180810.
    481968/full/.
        \16\ Baicker, Katherine, Michael E. Chernew, and Jacob A. Robbins.
    2013. ``The spillover effects of Medicare managed care: Medicare
    Advantage and hospital utilization.'' Journal of Health Economics
    32(6): 1289-1300; Glied, Sherry and Joshua Graff Zivin. 2002. ``How do
    doctors behave when some (but not all) of their patients are in managed
    care?'' Journal of Health Economics 21(2): 337-353; McWilliams, J.
    Michael, Bruce E. Landon, Michael E. Chernew. 2013. ``Changes in Health
    Care Spending and Quality for Medicare Beneficiaries Associated With a
    Commercial ACO Contract.'' Journal of the American Medical Association
    310(8): 829-836.

        It is less clear how ACOs have affected quality of care, in part
    because measuring changes in quality of care is more difficult. There
    is reasonably persuasive evidence that the savings achieved under
    Medicare's ACO models have not come at the cost of worse health
    outcomes.\17\ What is less clear is whether ACO models have actually
    improved quality of care and, if so, by how much. There is some
    evidence that ACOs have improved patients' experience of care.\18\ Some
    research has also suggested that ACOs have increased receipt of certain
    recommended screenings services, but this finding has been
    inconsistent.\19\ More research on this question would be valuable.
    ---------------------------------------------------------------------------
        \17\ Herrel, Lindsey A., Edward C. Norton, Scott R. Hawken, Zaojun
    Ye, Brent K. Hollenbeck, and David C. Miller. 2016. ``Early Impact of
    Medicare Accountable Care Organization Cancer Surgery Outcomes.''
    Cancer 122(17); 2739-2746; McWilliams, J. Michael, Lauren G. Gilstrap,
    David G. Stevenson, Michael E. Chernew, Haiden A. Huskamp, and David C.
    Grabowski. 2017. ``Changes in Post-acute Care in the Medicare Shared
    Savings Program.'' JAMA Internal Medicine 177(4): 518-526.
        \18\ McWilliams, J. Michael, Bruce E. Landon, Michael E. Chernew,
    and Alan M. Zaslavsky. 2014. ``Changes in Patients' Experiences in
    Medicare Accountable Care Organizations.'' New England Journal of
    Medicine 371(18): 1715-1724.
        \19\ McWilliams et al. (2015); McWilliams, J. Michael, Laura A.
    Hatfield, Michael E. Chernew, Bruce E. Landon, and Aaron L. Schwartz.
    2016. ``Early Performance of Accountable Care Organizations in
    Medicare.'' New England Journal of Medicine 374(24): 2357-2366.

        An important question is why ACOs have performed better than pay-
    for-
    performance programs like MIPS, at least with respect to the cost of
    care. I suspect two factors are important. First, an ACO serves many
    more patients than an individual clinician or practice. That larger
    size makes it much easier to produce statistically reliable measures of
    providers' performance, which in turn allows ACOs to use payment
    designs that create much stronger incentives to reduce spending than
    programs like MIPS. Second, ACOs make one provider (or group of
    providers) accountable for the overall cost and quality of a patient's
    care. That allows ACOs to create much more coherent--and
    comprehensible--incentives to improve patient care than programs like
    MIPS that make disconnected payment adjustments for each individual
    provider.
    Advanced APM Participation Has Risen Markedly in Recent Years
        Participation in APMs that meet the Advanced APM criteria has
    increased markedly since MACRA's enactment. Figure 1 presents data on
    participation in ACOs, which, as noted above, account for the large
    majority of APM and Advanced APM participation in Medicare.\20\ The
    share of Medicare beneficiaries served by providers that participate in
    an ACO that involves ``two-sided'' risk--the types of ACO models that
    qualify as Advanced APMs--stood at 9 percent in 2018, up from 3 percent
    in 2016, the last year before the Advanced APM bonus became available.
    Advanced APM participation also increased from 2015 to 2016, from 1
    percent to 3 percent, and it is possible that a portion of this
    increase occurred because providers were anticipating the fact that
    bonuses for Advanced APM participation would become available in 2017.
    ---------------------------------------------------------------------------
        \20\ These estimates include beneficiaries assigned to ACOs
    participating in the Medicare Shared Savings Program or the Center for
    Medicare and Medicaid Innovation's Pioneer and Next Generation ACO
    models. Estimates use the MSSP public use files produced by CMS, as
    well as the published financial results for the Pioneer and Next
    Generation models. Enrollment data are not yet available for 2018, but
    the number of ACOs participating in each program is available, so I
    have assumed that the number of beneficiaries assigned to each type of
    ACO grew in proportion to the number of ACOs of that type. Track 1+ did
    not exist as an MSSP participation option until 2018, so I assume that
    the average number of beneficiaries assigned to each Track 1+ ACO in
    2018 was the same as the average number of beneficiaries assigned to
    each Track 1 ACO in 2017.

    [GRAPHIC] [TIFF OMITTED] T5819.001

        Additional research on why participation in two-sided ACO models
    has risen in recent years would be valuable, but I suspect that the
    Advanced APM bonus has played an important role. That said, the bonus
    payment is likely not the only factor. Notably, CMS has recently been
    expanding its portfolio of two-sided ACO models: in 2016, CMS
    introduced the Track 3 participation option under the MSSP and
    introduced the Next Generation ACO model under the auspices of the
    Center for Medicare and Medicaid Innovation; and, in 2018, CMS
    introduced the Track 1+ participation option under the MSSP, an option
    that includes ``two-sided'' risk, but in a more limited form than prior
    models. Providers have also gained experience with ACO models over
    time, which may make them more willing to take on two-sided risk.
    MACRA's Advanced APM Bonus Has Supported Deployment of More Effective
            APMs
        The existence of the Advanced APM bonus has also encouraged CMS to
    be more aggressive in deploying ACO models that create stronger
    incentives for providers to reduce health-care spending. This is the
    case in at least two areas.

        First, in 2016, CMS finalized changes to the rules for calculating
    the spending ``benchmarks'' used to evaluate MSSP ACOs' spending
    performance. Prior to this change, benchmarks for MSSP ACOs were set
    based on each ACO's own spending over the 3 years preceding each
    agreement period. This methodology greatly weakened ACOs' incentives to
    reduce spending since success in reducing spending during an ACO's
    current agreement period was penalized by a dollar-for-dollar reduction
    in the ACO's benchmark for the subsequent agreement period.

        To ameliorate this problem, CMS changed the benchmark calculation
    so that each ACO's benchmark equaled a blend of the ACO's own past
    spending and average spending in the ACO's region.\21\ The revised
    methodology has the downside, however, of making MSSP participation
    less attractive for ACOs with high spending relative to their regions.
    The upward pressure on ACO participation from implementation of the
    Advanced APM bonus helped counteract the downward pressure on
    participation among high-cost ACOs from the benchmarking change and
    likely made CMS more willing to implement these improvements to the
    benchmarking methodology.
    ---------------------------------------------------------------------------
        \21\ Centers for Medicare and Medicaid Services. 2016. ``Medicare
    Program; Medicare Shared Savings Program; Accountable Care
    Organizations--Revised Benchmark Rebasing Methodology, Facilitating
    Transition to Performance-Based Risk, and Administrative Finality of
    Financial Calculations.'' Federal Register 81(112): 37950.

        Second, in late 2018, CMS finalized rules that will require all
    ACOs to shift into models that include two-sided risk more quickly than
    had been required under prior rules.\22\ Like the benchmarking change,
    this policy change involves a tradeoff. Models that include two-sided
    risk create stronger incentives for providers to reduce spending and,
    even holding underlying health care spending constant, directly
    generate larger savings for the Medicare program. Models with two-sided
    risk are also, however, less attractive to providers (all else being
    equal), so requiring two-sided risk is likely to put downward pressure
    on ACO participation. The existence of the Advanced APM bonus appears
    to have shaped how CMS weighed these tradeoffs and made it more willing
    to move ahead, which was, in my view, the right decision, although it
    was a close call.\23\
    ---------------------------------------------------------------------------
        \22\ Centers for Medicare and Medicaid Services. 2018. ``Medicare
    Program; Medicare Shared Savings Program; Accountable Care
    Organizations--Pathways to Success and Extreme and Uncontrollable
    Circumstances Policies for Performance Year 2017.'' Federal Register
    83(249): 67816.
        \23\ For additional discussion of my views on these changes, see
    Fiedler, Matthew. 2018. ``Comments on CMS's Proposed Rule, `Medicare
    Shared Savings Program; Accountable Care Organizations--Pathways to
    Success.' '' https://www.brookings.edu/opinions/comments-on-cmss-
    medicare-shared-savings-program-accountable-care-organizations-
    pathways-to-success/. For a thoughtful opposing view, see McWilliams,
    J. Michael, Michael Chernew, and Bruce Landon. 2018. ``Comment Letter
    on MSSP Proposed Rule.'' https://hmrlab.hcp.med.harvard.edu/mcwilliams-
    chernew-and-landon-comment-mssp-proposed-rule.
    ---------------------------------------------------------------------------
                   the best path forward: eliminate mips and
                       strengthen advanced apm incentives
        Policymakers should seek to build on the parts of MACRA that are
    working well, while discarding the parts that are not. To that end, I
    believe that the best path forward is to eliminate MIPS, but expand
    incentives for participation in Advanced APMs. I will discuss each
    recommendation in turn.
    Recommendation #1: Eliminate MIPS
        In light of the problems with MIPS discussed earlier, I agree with
    MedPAC and other experts that eliminating MIPS is the best path
    forward.\24\ Some of MIPS's problems--particularly those stemming from
    clinicians' ability to choose the quality measures they are evaluated
    on--could be addressed while retaining MIPS's basic structure. However,
    many of MIPS's issues are more fundamental. In particular, generating
    statistically reliable measures of cost and quality performance at the
    practice level is likely effectively impossible, as is creating
    coherent overall incentives to improve patient care by adjusting
    payments to individual physician practices.
    ---------------------------------------------------------------------------
        \24\ See, for example, Medicare Payment Advisory Commission. 2018.
    ``Moving Beyond the Merit-based Incentive Payment System.'' http://
    www.medpac.gov/docs/default-source/reports/
    mar18_medpac_ch15_sec.pdf?sfvrsn=0; Rathi, Vinay K. and J. Michael
    McWilliams. 2019 ``First-Year Report Cards From the Merit-based
    Incentive Payment System (MIPS): What Will Be Learned and What Next?''
    Journal of the American Medical Association.

        These challenges, together with the evidence that prior programs
    similar to MIPS have not been effective, lead me to believe that a
    reformed MIPS would still fail to generate improvements in the quality
    or efficiency of patient care sufficient to justify its administrative
    costs. I thus view eliminating MIPS as the best path forward. If MIPS
    were eliminated, policymakers should consider creating targeted
    incentives for use of certified EHRs and reporting to clinical
    registries; I discuss such incentives later in this testimony in the
    section on potential incremental changes to MIPS.
    Recommendation #2: Strengthen Incentives for Advanced APM Participation
        In contrast to MIPS, MACRA's incentive for participation in
    Advanced APMs appears to be achieving its main goal of increasing
    participation in effective alternative payment models. Policymakers
    should seek to build on the success of this component of MACRA by
    strengthening incentives for participation in Advanced APMs.

        Creating stronger incentives for participation in Advanced APMs
    would have two benefits. First, stronger incentives for Advanced APM
    participation would directly increase participation in these models,
    which the research reviewed earlier indicates would increase the
    efficiency of Medicare spending while maintaining or improving the
    quality of the care Medicare beneficiaries receive. Second, stronger
    incentives for participation in Advanced APMs would allow CMS to make
    further progress in deploying versions of APMs that create stronger
    incentives to reduce spending. In particular, it will likely ultimately
    be desirable for CMS to go further in requiring ACOs to take on two-
    sided risk and in basing ACOs' ``benchmarks'' on regional average
    spending rather than ACOs' own historical costs. However, as noted
    earlier, changes like these make ACO participation less attractive for
    some categories of providers. Sufficiently strong incentives for
    Advanced APM participation could mitigate or eliminate this tradeoff.

        A good first step to strengthen incentives for participation in
    Advanced APMs would be to make MACRA's bonus for participation in
    Advanced APMs permanent, a point I return to in the next section of my
    testimony. However, more significant enhancements are warranted:

              Increase the size of the incentive for Advanced APM
            participation: One worthwhile step would be to increase the
            size of MACRA's incentives for participation in Advanced APMs.

           Determining the appropriate magnitude of the increase would
    require additional modeling and analysis, but creating an incentive for
    Advanced APM participation that is at least twice as large as the
    current incentive could easily be appropriate.

           Since a major objective of promoting greater participation in
    Advanced APMs is to reduce Medicare spending, additional incentives for
    Advanced APM participation should be structured in a way that does not
    increase Federal costs. To that end, Congress could implement a budget-
    neutral combination of larger bonuses for Advanced APM participation
    and penalties for providers that decline to participate in an Advanced
    APM. This approach of using penalties from poor performers to fund
    bonus payments to high performers is similar to the approach Congress
    has taken under MIPS and many other programs.

              Create incentives for other categories of providers to
            participate in Advanced APMs or collaborate with participants
            in Advanced APMs: An additional worthwhile step would be to
            create incentives for other categories of providers,
            particularly hospitals, to participate in Advanced APMs or
            collaborate with providers who participate in Advanced APMs.
            Providers could qualify for incentive payments in essentially
            the same way that clinicians can qualify under MACRA, with the
            exception that providers could count services or patients
            associated with an Advanced APM in which the provider was not
            itself participating if the provider had a written
            collaboration agreement with participants in that Advanced APM.
            This approach would, for example, allow a hospital to earn the
            incentive payment by collaborating with one or more physician-
            only ACOs in its community rather than setting up its own ACO.
            Allowing hospitals to take this approach is particularly
            important in light of the evidence noted above that physician-
            only ACOs have been more successful in reducing spending than
            those containing a hospital as a participant.

           There are two reasons to extend Advanced APM incentives to non-
    physician providers. First, it would give these providers a greater
    stake in the deployment and success of Advanced APMs, which may be
    necessary to fully realize these models' potential to improve the
    quality and efficiency of patient care. Second, there are likely limits
    on how low payment rates for clinicians not participating in Advanced
    APMs can be set, which limits the overall size of the incentives that
    can be created for Advanced APM participation if the physician fee
    schedule is the sole vehicle for creating those incentives. Extending
    incentives for Advanced APM participation for other providers relaxes
    this constraint.

           As above, it would be important that additional incentives for
    Advanced APM participation be structured in a way that would not
    increase Federal costs. To this end, any incentive for hospitals or
    other categories of providers could be structured as a budget-neutral
    combination of bonuses for participants and penalties for non-
    participants.
               incremental steps: extend the advanced apm bonus
                         and make targeted mips changes
        While eliminating MIPS and expanding MACRA's Advanced APM
    incentives is the best path forward in my view, there are also
    opportunities to make incremental improvements in both areas.
    Permanently Extend the Advanced APM Bonus and Eliminate the Eligibility
            ``Cliff''
        There are at least two incremental changes that could be made to
    the Advanced APM bonus:

              Permanently extend the Advanced APM bonus: One important
            step Congress can take is to permanently extend the Advanced
            APM bonus, which is currently scheduled to expire after the
            2022 performance year. It would be best to enact an extension
            well before the bonus expires. Many of the investments
            providers need to make to be successful under Advanced APMs are
            only likely to be attractive to providers that expect to
            continue participating in Advanced APMs in the future, and the
            likelihood that the Advanced APM bonus will continue is one
            major factor shaping providers' plans about future APM
            participation. Waiting until the last minute to extend the
            bonus would thus likely reduce Advanced APM participation in
            the near term and forfeit a portion of the bonus's potential
            benefits.

           The Advanced APM bonus can and should be extended in a way that
    does not increase overall Medicare spending. One approach to achieving
    this objective, discussed above, would be to replace the current bonus
    payment with a budget-neutral combination of bonuses for Advanced APM
    participation and penalties for non-participation. Another approach
    would be to pair the extension with offsetting changes to Medicare
    payments.

              Smooth out the ``cliff'' in the Advanced APM bonus
            eligibility criteria: A clinician's eligibility for the
            Advanced APM bonus depends on whether a sufficient share of its
            payments or patient volume is connected with an Advanced APM.
            Clinicians that exceed the threshold are eligible for the full
            bonus, while clinicians that fall short, even by a very small
            amount, are eligible for no bonus payments at all.

           This ``all or nothing'' structure is hard to justify. The
    Medicare program frequently benefits from clinician engagement with
    Advanced APMs even when that engagement falls short of the eligibility
    thresholds; that will be particularly true under the relatively high
    eligibility thresholds that will apply over the long run. Additionally,
    the Medicare program would sometimes benefit if clinicians that meet
    the current thresholds had incentives to further increase their
    engagement with Advanced APMs.

           Thus, it would be desirable to replace the current ``all or
    nothing'' structure with a structure in which a clinician's bonus
    phased up gradually once a clinician's engagement with Advanced APMs
    crossed a threshold level. Under such an approach, it would be
    important that the bonus payment phase in rapidly enough to ensure that
    clinicians currently receiving bonuses generally received bonuses
    comparable to those they receive today. This approach has similarities
    to a proposal included in the administration's fiscal year 2020 budget,
    but there are two important differences.\25\ First, the
    administration's proposal appears to reduce bonuses for many current
    recipients, which would be a step in the wrong direction. Second, the
    administration's proposal would pay bonuses to some providers with very
    limited Advanced APM engagement, which is likely a low-priority use of
    bonus funds.
    ---------------------------------------------------------------------------
        \25\ Department of Health and Human Services. 2019. ``Fiscal Year
    2020 Budget-in-Brief.'' https://www.hhs.gov/sites/default/files/fy-
    2020-budget-in-brief.pdf.
    ---------------------------------------------------------------------------
    Make Targeted Improvements to MIPS
        As noted earlier, I believe there are limits to what a reformed
    MIPS program could realistically achieve. But there are three changes
    that I believe would improve MIPS's performance:

              Standardize quality measures: The problems that arise from
            clinicians' ability to choose quality measures under MIPS could
            be addressed by directing CMS to establish standardized measure
            sets for each specialty (or subspecialty) and requiring
            clinicians to report those standardized measure sets. The
            applicable measure set could be determined from claims data
            based on the mix of services a clinician delivered.\26\
    ---------------------------------------------------------------------------
        \26\ Multi-specialty groups could be required to report on all
    measure sets that applied to more than a specified share of their
    clinicians.

           Particularly initially, it is likely that some clinicians would
    lack a standardized measure set appropriate to their practice. For
    these clinicians, the quality category could be excluded from scoring
    under MIPS. Excluding the quality category would be preferable to
    requiring clinicians to incur the costs necessary to continue reporting
    under the current system since such reporting appears unlikely to
    ---------------------------------------------------------------------------
    meaningfully benefit Medicare beneficiaries.

           CMS could be directed to collaborate with other payers in
    constructing these specialty-specific standardized measure sets, to the
    extent feasible, in order to reduce administrative burden for
    providers. CMS is already engaged in such a process via the Core
    Quality Measures Collaborative operating under the auspices of the
    National Quality Forum.

           An alternative approach to reforming the MIPS quality category
    would be to eliminate the requirement that clinicians report quality
    measures and instead rely on measures derived from claims records or
    beneficiary surveys. The administration's fiscal year 2020 budget and
    MedPAC have both put forward proposals in this vein.\27\ This approach
    would generate large reductions in clinicians' reporting burdens and is
    worth considering. However, even with this change, I expect that MIPS
    would remain an ineffective tool for improving the quality and
    efficiency patient care, so if Congress is willing to consider changes
    this large, I would encourage it to consider eliminating MIPS entirely.
    ---------------------------------------------------------------------------
        \27\ Ibid.; Medicare Payment Advisory Commission. 2018. ``Moving
    Beyond the Merit-based Incentive Payment System.'' http://
    www.medpac.gov/docs/default-source/reports/mar18_medpac
    _ch15_sec.pdf?sfvrsn=0.

              Eliminate the practice improvement category and create a
            targeted incentive for reporting to clinical data registries:
            The MIPS practice improvement category is essentially a ``box
            checking'' exercise that is doing little to improve patient
            care but is creating reporting costs for clinicians. I
    ---------------------------------------------------------------------------
            recommend eliminating this category.

           That said, there may be some specific activities currently
    included on the list of practice improvement activities that are worth
    encouraging. Notably, clinician reporting to clinical data registries
    has features of a ``public good.'' Reporting to registries generates
    benefits for the health care system as a whole by facilitating research
    on ways to improve patient care and allowing clinicians to compare
    themselves to their peers.

           To encourage registry reporting, Congress could create a small,
    targeted incentive for clinicians to report to registries that meet
    rigorous criteria. The appropriate size of such an incentive merits
    further research, but a reasonable starting point would be 0.5 percent
    of clinicians' payments. The incentive could be structured as a budget-
    neutral combination of bonuses for compliance and penalties for non-
    compliance, similar to the existing payment adjustments under MIPS.
    Congress could consider applying this incentive to clinicians
    participating in Advanced APMs in addition to those participating in
    MIPS, as reporting by Advanced APM participants generates similar
    systemic benefits.

              Eliminate the Promoting Interoperability category and create
            a targeted incentive for use of a certified EHR: Encouraging
            clinicians to use EHRs that meet the certification standards
            promulgated by HHS generates substantial benefits for the
            health-care system by facilitating interoperability. It is much
            less clear, however, that there is a rationale for requiring
            providers to use these tools in particular ways, rather than
            allowing providers to use these tools in whatever way generates
            the greatest value for their patients.

           For that reason, I recommend eliminating the MIPS Promoting
    Interoperability category and replacing it with a small, targeted
    incentive for having an EHR that meets the HHS certification standards.
    Practices could earn the incentive merely by showing that they have a
    suitable EHR installed and in active use, similar to the requirements
    currently in place for Advanced APMs. Clinicians would not be required
    to perform any specific activities with that EHR, unlike under MIPS.
    CMS has moved a significant distance in this direction in creating the
    requirements for the current Promoting Interoperability category, but
    it would be possible to at least modestly reduce burden by simplifying
    further. Like the incentive for registry reporting, the appropriate
    size of such an incentive merits further research, but a reasonable
    starting point would be 0.5 percent of clinicians' payments, structured
    as a budget-neutral combination of bonuses and penalties.

                                     ______

          Questions Submitted for the Record to Matthew Fiedler, Ph.D.
                    Questions Submitted by Hon. Rob Portman
        Question. I introduced the Medicare Care Coordination Improvement
    Act with Senator Bennet in an effort to reduce some of the barriers
    that providers face when they participate in Alternative Payment
    Models. However, one particular section of my bill focuses on providing
    temporary waivers to practices that are interested in testing their own
    APMs. HHS has been slow to take up new APM concepts, and thus: what can
    we do to incentivize the establishment of new APMs? Has the PTAC
    offered a viable way to propose and test new APMs? If not, what actions
    could be taken to encourage the adoption of PTAC models?

        Answer. In my view, focusing on expanding the portfolio of APMs
    clinicians can choose is a poor strategy for improving the quality and
    efficiency of Medicare beneficiaries' care. A proliferation of APMs
    would create opportunities for clinicians to choose among APMs based on
    which APM would be most financially advantageous to them, not which APM
    would generate the largest improvements in the quality and efficiency
    of patient care. This type of strategic APM selection could have
    various downsides, including increased costs for the Medicare program.

        As discussed in my testimony, I do believe that expanding
    participation in Advanced APMs is an important objective. However,
    rather than achieving that objective by increasing the number of APMs
    clinicians can choose among, I would recommend: (1) increasing
    incentives for participation in existing Advanced APMs, notably
    accountable care organization models; and (2) testing and deploying
    additional episode and bundled payment models on a mandatory basis.

        Question. Per data from CMS, about half of all Medicare providers
    are participating in MIPS, with the majority of these non-participating
    providers being exempt via the low-volume threshold. While we don't
    want to place additional burdens on small and rural providers, we
    should be identifying ways to engage with these practices to help them
    transition towards value-based outcomes.

        What actions should be taken to engage with these providers?

        Answer. Ensuring that all providers, including small and rural
    providers, deliver efficient, high-quality care is an important
    objective. However, due to the broader shortcomings of MIPS, which are
    discussed at length in my testimony, expanding these providers'
    engagement with MIPS is unlikely to pay major dividends. A more
    promising strategy for improving the quality and efficiency of patient
    care is to create stronger, more effective incentives to participate in
    Advanced APMs. As discussed in my response to the next question, while
    small and rural providers do face special barriers to engaging with
    such models, the existence of incentives to participate in Advanced
    APMs is spurring the private sector to develop approaches that make
    participating in these models feasible for many types of providers.

        Question. I'd like to ask about your proposals to improve
    participation in APMs. I appreciate your proposal to ``smooth out the
    cliff'' for participating in APMs, but I want to get your perspective
    on whether this may be enough to incentivize small and rural practices
    to participate in APMs. Your proposal would help move providers towards
    APMs if they are already able to bear risk, but some of the smaller and
    rural practices may not be ready yet to do that.

        What actions could Congress take to help these practices start to
    take on risk?

        Answer. Small and rural providers face barriers to participation in
    Advanced APMs that other providers do not. However, even for these
    providers, I believe that strengthening and improving incentives for
    participation in Advanced APMs--including eliminating the cliff in the
    Advanced APM bonus eligibility rules and, more importantly,
    strengthening the overall size of the incentives for Advanced APM
    participation--is the best path to encouraging greater Advanced APM
    participation for all types of providers.

        If strong, predictable incentives for Advanced APM participation
    are in place, I expect that the private sector will develop solutions
    that facilitate Advanced APM participation for all types of providers.
    Indeed, spurred in part by the existing incentives for Advanced APM
    participation, a range of private firms now offer services aimed at
    helping providers of all types participate successfully in Advanced
    APMs. These firms frequently take on a portion of the downside risk
    involved in participating in an Advanced APM and give providers tools
    designed to help them be successful under the APM, including analytic
    and programmatic support.

                                     ______

                     Questions Submitted by Hon. Ron Wyden
        Question. The Independence at Home demonstration, which was
    expanded and extended last year through the CHRONIC Care Act, enables
    care teams to deliver high-quality primary care to Medicare
    beneficiaries in the comfort of their own homes. In its third
    performance year, according to the Centers for Medicare and Medicaid
    Services (CMS), Independence at Home saved $16.3 million for the
    Medicare program.\1\ A recent evaluation also found that Independence
    at Home has resulted in fewer emergency department visits leading to
    hospitalization, a lower proportion of beneficiaries with at least one
    unplanned hospital readmission during the year, and a reduced number of
    preventable hospital admissions.\2\
    ---------------------------------------------------------------------------
        \1\ https://innovation.cms.gov/Files/fact-sheet/iah-yr3-fs.pdf.
        \2\ https://innovation.cms.gov/Files/reports/iah-rtc.pdf.

        As I mentioned at the hearing, I am committed to building on the
    success of the Independence at Home demonstration. As discussed at the
    hearing, I understand that the new Primary Care First model recently
    announced by CMMI (the Center for Medicare and Medicaid Innovation at
    CMS) may provide an avenue to expand access to home-based primary care
    ---------------------------------------------------------------------------
    for more Medicare beneficiaries.

        What key components will be necessary in order for the Primary Care
    First model to expand access to home-based primary care?

        Answer. The performance-based payments available under the Primary
    Care First model are based primarily on providers' success in reducing
    hospitalizations. Thus, two things are likely to be required for the
    model to expand delivery of these services. First, providers must
    believe that home-based primary care services are a cost-effective
    means of reducing hospitalizations. Second, providers must be attentive
    to the financial incentives created under the model. Experience with
    CMMI's prior medical home models (the Comprehensive Primary Care
    Initiative and Comprehensive Primary Care Plus models) has been
    somewhat discouraging in this regard, but the payment methodology under
    the Primary Care First model is sufficiently different to merit
    additional testing.

        Question. What other specific policies would you recommend Congress
    or CMS consider to expand access to home-based primary care for more
    Medicare beneficiaries?

        Answer. In general, I would encourage Congress and CMS to focus on
    creating broad-based incentives for providers to improve the quality
    and efficiency of patient care. As discussed in my testimony, one
    promising way to do so would be to improve and strengthen incentives
    for providers to participate in Advanced APMs. This approach would
    reward greater provision of home-based primary care services in
    settings where those services are likely to improve the quality and
    efficiency of patient care, while ensuring that the Medicare program
    does not bear the cost if these services are deployed in settings where
    they are not appropriate or effective.

        Question. As I mentioned during the hearing, I often hear from
    seniors in Oregon that they don't feel like anyone is in charge of
    managing their health care and helping them navigate the health-care
    system. I am proud of the bipartisan work that this committee did on
    the CHRONIC Care Act last Congress to update the Medicare guarantee. In
    my view, the next step should be making sure that all Medicare
    beneficiaries with chronic illnesses have someone running point on
    their health care--in other words, a chronic care point guard--
    regardless of whether they get their care through Medicare Advantage
    (MA), an Accountable Care Organization (ACO) or other Alternative
    Payment Model, or traditional fee-for-service Medicare.

        For beneficiaries in traditional, fee-for-service Medicare, what
    can be done to improve care coordination and make sure their physicians
    and other health-care professionals are all talking to each other and
    working together to provide the best possible care to those
    beneficiaries? What specific policies would you recommend this
    committee pursue toward that end?

        Answer. Please see the response under the next question.

        Question. Please describe the specific steps that Congress and/or
    CMS could take to ensure all Medicare beneficiaries with chronic
    illnesses, including those in traditional fee-for-service Medicare,
    have a chronic care point guard.

        Answer. One worthwhile step would be to increase payments for
    evaluation and management services under the physician fee schedule,
    financed by a reduction in payments for other services. Such a step
    would likely expand the supply of primary care services and facilitate
    improvement in the quality of those services. This type of change would
    benefit all enrollees in traditional Medicare, including those cared
    for by providers not affiliated with an ACO. It might also benefit
    people covered by private insurers since Medicare's fee schedule
    frequently serves as a template for private insurers' payments.

        However, there are likely limits to the improvements in care
    coordination that can be achieved in the context of fee-for-service
    payment models. Improving provider participation in ACOs and similar
    models is thus another important objective. As discussed in my
    testimony, one way to do so would be to improve and strengthen
    incentives for providers to participate in Advanced APMs.

                                     ______

                   Question Submitted by Hon. Debbie Stabenow
        Question. I am very proud of the work the bipartisan
    accomplishments to address Alzheimer's, including the implementation of
    my HOPE for Alzheimer's Act which required Medicare to pay for new
    individual care plans to support Alzheimer's patients and their
    families. Many of my colleagues are also cosponsors of my Improving
    HOPE for Alzheimer's Act, which will ensure beneficiaries and
    physicians know that they are able to access, and bill for, care
    planning under Medicare. In our last hearing on MACRA implementation,
    my colleagues raised the question of how we should look at quality
    measures in MIPS when it comes to physicians having these conversations
    with beneficiaries and their families and reflecting their priorities.
    Some have mentioned altering MIPS to make the quality measures more
    clinically meaningful. In what ways do you think the system would need
    to change to better incorporate long-term care planning and encourage
    physicians to have these conversations with patients?

        Answer. As I discussed in my testimony, in light of the
    discouraging results from research on pay-for-performance systems
    similar to MIPS, I am pessimistic that even a reformed MIPS program
    could produce substantial improvements in the quality of the care
    Medicare beneficiaries receive, including with respect to long-term
    care planning.

        However, some improvement might be possible by standardizing the
    performance measures used in the MIPS quality category. As discussed in
    my testimony, clinicians' ability to choose the measures they are
    evaluated on under MIPS makes it difficult for CMS to use MIPS data to
    distinguish between high and low performers for payment purposes. It
    also makes it difficult for patients to use those data to choose a
    provider. These shortcomings, in turn, keep MIPS from creating strong
    incentives to improve quality performance. Standardizing the quality
    measures used under MIPS would give MIPS a fighting chance to improve
    care on the dimensions of quality that policymakers prioritized. Those
    could, if desired, include long-term care planning.

                                     ______

                   Questions Submitted by Hon. Sherrod Brown
                           the patient voice in macra
        Question. As I mentioned in my hearing questions, we passed MACRA
    to incentivize and reward high-value, patient-centered care. While
    MACRA is all about physician payment reform, our goal should be
    maximizing patient benefit. It is clear to me that we have not done
    enough to ensure the patient's voice is a part of the process, and that
    patients are benefitting from these changes. The NIH has created
    Patient-Focused Therapy Development tools and systems dedicated to
    engaging the patient community throughout the translational science
    process. The FDA has implemented a Patient-Focused Drug Development
    model to help ensure patients' experiences, perspectives, needs, and
    priorities are captured meaningfully during drug development and
    review.

        Are you aware of any efforts to monitor MACRA's impact on patient
    satisfaction?

        Answer. I am not aware of any ongoing research to estimate MACRA's
    effect on patient satisfaction.

        Question. What is the best way to evaluate patient benefit across
    MACRA's programs?

        Answer. Quantifying the effects of any policy intervention,
    including MACRA, requires determining what would have happened in the
    policy's absence. Researchers have a range of tools for doing this, but
    they are not universally applicable and must be carefully tailored to
    the particular setting in which they are applied. Thus, the best
    approach is likely to vary across MACRA's components, and it is not
    possible to identify a single best research design.

        However, it is important that any comprehensive evaluation of
    MACRA's effects on Medicare beneficiaries account for the fact that
    these effects may be multi-
    faceted. MACRA may affect ``objective'' measures of health status like
    longevity, as well as ``subjective'' measures of well-being like
    patient satisfaction. Reductions in the cost of care could also improve
    beneficiaries' financial security by reducing their premiums and cost-
    sharing. Obtaining a complete picture of MACRA's effects on Medicare
    beneficiaries requires taking account of--and appropriately weighing--
    all of these various effects.

                                     ______

                 Questions Submitted by Hon. Sheldon Whitehouse
        Question. Accountable Care Organizations (ACOs) have the potential
    to transform our health care delivery system. While we've seen ACOs
    improve patient care and create shared savings, many provider-led ACOs
    only control a small fraction of total spending, with specialists,
    pharmaceuticals, and hospitals accounting for most of it. This leads to
    ACOs lacking sufficient leverage to bring down costs and can contribute
    to shared losses.

        How can we improve the ACO model to account for this imbalance? How
    can we support successful ACOs and encourage more providers to follow
    their lead?

        Answer. Interestingly, the best research on the effect of the
    Medicare shared savings program has suggested that ACOs that do not
    include a hospital have had the greatest success in reducing Medicare
    spending.\3\ Indeed, small ACOs may have one important advantage:
    unlike an ACO that includes a hospital, a physician-only ACO does not
    need to worry that reducing unnecessary hospitalizations will reduce
    its inpatient volume.
    ---------------------------------------------------------------------------
        \3\ McWilliams, J. Michael, Laura A. Hatfield, Bruce E. Landon,
    Pasha Hamed, and Michael E. Chernew. 2018 ``Medicare Spending after 3
    Years of the Medicare Shared Savings Program.'' New England Journal of
    Medicine 379(12): 1139-1149.

        Nevertheless, the relatively small fraction of total spending
    accounted for by
    physician-led and, particularly, primary-care-led ACOs does present two
    special obstacles: (1) shared savings/shared losses calculated on the
    total cost of care can be large relative to these ACOs' revenue; and
    (2) these ACOs can have difficulty eliciting cooperation from other
    ---------------------------------------------------------------------------
    providers.

        In my view, both problems can be ameliorated by improving the
    financial incentives for participation in Advanced APMs along the lines
    I recommended in my testimony. The first problem can be ameliorated by
    increasing the overall size of incentive for participation in Advanced
    APMs, which will make taking on significant financial risk to
    participate in such models more palatable for these types of providers.

        The second problem can be addressed by creating incentives for non-
    physician providers to engage with Advanced APMs that parallel MACRA's
    incentives for physicians. For example, a hospital (or other category
    of provider) could receive an incentive payment based on the share of
    its volume received through ACOs with whom it had a formal
    collaboration agreement. Since the hospital would need the ACO's sign-
    off to receive the incentive payment, this would give the ACO leverage
    over the hospital's behavior that it lacks today.

        It would be important to structure enhanced incentives for Advanced
    APM participation in ways that would not increase overall spending.
    That could be done by implementing a budget-neutral combination of
    bonuses for engaging with an Advanced APM and penalties for failing to
    do so, akin to how Congress combined bonuses and penalties under MIPS.

        Question. Our health-care system is not fully equipped to care for
    an aging population and patients with advanced illness such as late-
    stage cancer, Alzheimer's disease or dementia, or congestive heart
    failure. This is an area where we need new models of care that reflect
    these challenges and create a better system for providers, patients,
    and their families. Many of our current Medicare rules in this space
    are counterproductive, such as requiring a 2-night, 3-day stay in an
    inpatient facility to qualify for skilled nursing care, and various
    disincentives to providing respite or palliative care. How are your
    organizations innovating to provide care for these patients, and what
    can Congress and CMS do to support those efforts?

        Answer. Congress could facilitate the relaxation or removal of some
    of the Medicare rules you are concerned about by encouraging greater
    participation in Advanced APMs. Some of these rules, including the
    skilled nursing facility (SNF) 3-day rule, are motivated by concerns
    that providers have incentives to encourage inappropriate use of the
    relevant services in order to increase their Medicare payments. Those
    concerns largely do not exist when providers are at risk for a
    sufficient fraction of the cost of a beneficiary's care, as is the case
    under Advanced APMs. Because of this fact, CMS has issued partial
    waivers of the SNF 3-day rule for beneficiaries assigned to certain ACO
    models that involve two-sided risk. Broader participation in Advanced
    APMs would expand eligibility for these and similar waivers, as well as
    facilitate the creation of waivers in other similar areas.

        Question. Despite continued investment, electronic health records
    (EHRs) remain difficult to share, challenging for patients to access,
    and a source of frustration to providers and policymakers alike. The
    business models of the EHR venders often leads to perverse incentives
    against sharing patient information.

        What steps can Congress take to make EHRs work better for
    providers? Are the proposed data blocking rules enough to start
    encouraging better data sharing by the vendors?

        Answer. I have not studied the EHR market carefully enough to make
    recommendations about how to improve EHR functionality. I have also not
    studied the proposed data blocking rules carefully enough to render a
    judgement. However, as I described in my testimony, there are
    opportunities to make Medicare's EHR requirements less burdensome for
    clinicians without compromising efforts to improve usability and
    interoperability. The MIPS promoting interoperability category could be
    replaced by a small payment incentive for having an EHR that meets
    Federal certification standards installed and in active use. Unlike
    under MIPS, clinicians would not be required to perform any specific
    activities with that EHR, which would limit compliance costs for
    providers. The incentive could be structured as a budget-neutral
    combination of payment bonuses and penalties.

        Question. How can we encourage States to be better innovators on
    health-care spending? The current Medicaid waivers incentivize States
    to keep costs down, but are there ways to encourage both lower costs
    and better health-care outcomes?

        Answer. Starting with Medicaid, because provider payment rates
    under State Medicaid programs are generally already relatively low,
    efforts to reduce the cost of delivering Medicaid coverage should focus
    on encouraging more efficient utilization of health-care services. Just
    like for the Federal Government, one promising strategy for States is
    to make greater use of non-fee-for-service payment mechanisms that
    reward efficient, high-quality care.

        States are already engaged in a variety of efforts in this area
    (and frequently can do so without a waiver from CMS), but the Federal
    Government can support them in a variety of ways. First, the Federal
    Government should continue its efforts to develop and deploy APMs.
    Federal payment reform efforts provide templates that other payers,
    including State Medicaid programs, can use in their own payment reform
    efforts. Second, where possible, the Federal Government should partner
    with State Medicaid programs to deploy APMs that are harmonized across
    Medicare, Medicaid, and private payers. CMS has already done this in
    some instances, but it should look for additional opportunities to do
    so in the future.

        Looking beyond Medicaid, States should also seek to reduce the cost
    of health care in the private insurance market. In particular, States
    should seek to foster robust competition in health care provider
    markets and health insurance markets. That could include robustly
    enforcing antitrust laws with respect to mergers and anti-competitive
    conduct, as well as repealing State laws that inhibit competition, such
    as so-called ``any willing provider'' laws. The Federal Government
    could encourage activities like these by providing grant funding to
    States that act in these areas. The Federal Government should also
    remove barriers that keep States from getting a comprehensive picture
    of their health-care markets; notably, Congress should address
    limitations on States' ability to construct all-payer claims databases
    that were created by the Supreme Court's decision in Gobeille vs.
    Liberty Mutual Insurance Company.

                                     ______

               Questions Submitted by Hon. Catherine Cortez Masto
        Question. Early on, with Meaningful Use, Congress heard a lot from
    providers about the complexity and reporting burden; we are hearing
    less but concerns remain.

        Should the EHR vendors be responsible for ensuring use and
    workability rather than the doctors? How would that work?

        Answer. As I discussed in my testimony, there are opportunities to
    make Medicare's EHR requirements less burdensome for clinicians. In
    particular, the MIPS promoting interoperability category could be
    replaced with a small payment incentive for having an EHR that meets
    Federal certification requirements installed and in active use. Unlike
    under MIPS, clinicians would not be required to perform any specific
    activities with that EHR, which would limit clinicians' compliance
    burdens. The incentive could be structured as a budget-neutral
    combination of payment bonuses and penalties.

        It is important, however, to retain some direct incentive for
    providers to install and use certified EHRs since the Federal
    certification standards are an important tool for promoting
    interoperability. While vendors could be encouraged to market EHRs that
    meet these standards using other policy tools, some incentive for
    providers is likely necessary to ensure that providers actually adopt
    those EHRs.

        Question. How do we bring the rest of the health-care workforce
    online--ambulances, mental health providers, etc.?

        Answer. As with physicians and hospitals, encouraging other types
    of providers to use EHRs that meet Federal certification standards has
    the potential to benefit the health-care system as a whole by
    facilitating interoperability. Creating a modest payment incentive for
    having a certified EHR installed and in active use, similar to the
    incentive my testimony proposes for clinicians, would be one approach
    to this problem worth considering.

                                     ______

                  Prepared Statement of Hon. Chuck Grassley,
                            a U.S. Senator From Iowa
        I want to thank the witnesses for being here today. We look forward
    to hearing how physician payment reforms in the Medicare Access and
    CHIP Reauthorization Act are driving good patient outcomes. The MACRA
    law also took the historic step of getting rid of the flawed
    sustainable growth rate formula.

        Let me take a moment to go through the history of the SGR as the
    saga ended with a hopeful message. Congress established the SGR in 1997
    as a mechanism to control Medicare spending on physician services. The
    formula worked at first, but it wasn't long before it called for large
    reductions in payments that threatened access to care. This set in
    motion a perpetual exercise where Congress scrambled to prevent the
    cuts.

        Congress acted 17 times over more than a decade--each time kicking
    the can down the road without solving the underlying problem. Then, in
    2015, Congress finally came together and passed the MACRA law by an
    overwhelming margin in both chambers. MACRA showed that Congress can
    still work together in a bipartisan manner to address big problems.

        This reminder reinforces my belief in the current bipartisan
    Finance Committee process to lower prescription drug costs. It bodes
    well for making changes in Medicare to improve access to care for
    patients in rural and underserved areas. This is another project to
    which Ranking Member Wyden and I are committed.

        These bipartisan efforts also provide a glimmer of hope that
    Republicans and Democrats can join together to prevent Medicare from
    going broke. I urge my colleagues on the other side of the aisle to
    focus on shoring up Medicare's finances. This is time better spent than
    trying to expand Medicare for all only for it to invariably end up
    available to none.

        The MACRA payment reforms established incentives for physicians to
    provide the highest quality of care at the lowest possible cost.
    Physicians can pick from two different paths. They can opt to be graded
    on metrics in a number of different categories, or choose to get paid
    under a different model, such as a single payment for a bundle of
    services.

        This committee held a hearing in 2016 on the initial plan by the
    Centers for Medicare and Medicaid Services to implement these reforms.
    While the CMS implementation remains a work-in-progress, the 2 years of
    experience allow us to take stock of how well these reforms are
    working. That's why we brought in physicians and other experts who are
    at the forefront of these efforts.

        The witnesses are from physician organizations that represent
    different specialties and practice characteristics. This diversity of
    physician practice mirrors the varying needs of Medicare patients. It
    also highlights the inherent challenge in getting top-notch care to
    everyone, including those in rural areas.

        I am proud that physicians in Iowa provide high-quality care while
    spending less than in many other areas. This is the value that the
    MACRA payment reforms aim to achieve.

        I look forward to hearing from the witnesses about their experience
    and what Congress should consider for the road ahead.

                                     ______

              Prepared Statement of Scott Hines, M.D., Director,
                       American Medical Group Association
        Chairman Grassley, Ranking Member Wyden, and distinguished members
    of the Senate Finance Committee, thank you for the opportunity to
    testify on behalf of AMGA, where I serve as chair of its Public Policy
    Committee and member of their board of directors. AMGA represents 450
    multispecialty medical groups and integrated delivery systems across
    the United States. More than 175,000 physicians practice in AMGA member
    organizations, delivering care to one in three Americans.

        I am board-certified in internal medicine, endocrinology, diabetes,
    and metabolism, and am Crystal Run Healthcare's chief quality officer,
    as well as medical director and physician leader for our medical
    specialties division. Crystal Run Healthcare employs more than 450
    providers across 50 different primary care, medical, and surgical
    specialties in 20 locations throughout the lower Hudson Valley of New
    York State. We were among the first 27 Accountable Care Organizations
    (ACOs) to participate in the Medicare Shared Savings Program (MSSP)
    since 2012. In my role as chief quality officer, I have helped develop
    and implement the clinical programs necessary to deliver value-based
    care to our patients.

        I want to thank Congress for eliminating the sustainable growth
    rate (SGR) formula in its attempt to bring more stability to the
    Medicare Part B program. The SGR formula necessitated continuous fixes
    every year, forcing policymakers to think in the short term, and we
    appreciate that we now have the opportunity and ability to plan for the
    future. Congress's passage of the Medicare Access and CHIP
    Reauthorization Act (MACRA) of 2015 represents an opportunity for
    providers to move away from the current fee-for-service reimbursement
    model and transition towards value-based care by adjusting payments
    based on quality and other key factors.

        The Centers for Medicare and Medicaid Services (CMS) envisioned
    that MACRA would help achieve three goals for the health-care system--
    better care, smarter spending, and healthier people. The law and
    regulations would achieve this by rewarding physicians who performed
    well in three key areas: payment incentives, care delivery, and
    information sharing.

        Policymakers in Congress and the administration have made clear
    their intent to transform the way health care is financed and delivered
    in this country. The need to move Medicare to value is evident today,
    more than ever, and I believe Congress passed MACRA to drive that
    transition to value in Medicare Part B. Our current fee-for-service
    payment system is not sustainable and is not the model best suited to
    provide coordinated, high quality, cost effective care to our patients.
    AMGA members are looking to Congress for a stable, predictable value
    program that creates meaningful and realistic incentives that motivates
    them to make the multimillion-dollar investments needed to chart a
    course to value.

        Congressional passage of MACRA aimed to bring more stability to
    Medicare physician reimbursement by granting providers predictable
    payments until this year, when two new systems would be fully
    implemented: the Merit-based Incentive Payment System (MIPS) and
    Advanced Alternative Payment Models (APMs). AMGA members, like Crystal
    Run Healthcare, have invested considerable time and resources to
    deliver the best possible care while embarking on this pathway to
    value, and have concerns with the implementation of these two systems.
                   what it takes to deliver value-based care
        The competencies necessary to deliver coordinated, value-based care
    are not incentivized in a fee-for-service system. Over the past decade,
    Crystal Run Healthcare has invested tens of millions of dollars in the
    infrastructure, personnel, and technology needed to deliver care that
    improves quality and lowers cost. Crystal Run care managers, for
    example, act as liaisons and points of contact between visits to ensure
    that our patients understand and comply with their personalized care
    plans. Our technology solutions risk stratify the population to
    identify the most vulnerable patients under our care. Homegrown
    analyses evaluate variations in care to increase awareness of, and
    adherence to, evidence-based practice guidelines. A Care Optimization
    Team reaches out to patients identified to have gaps in care in an
    effort to reengage them and get them the care that they need. None of
    this is rewarded in a transactional, fee-for-service system. Provider
    groups like Crystal Run rely on dependable, value-oriented payment
    models from CMS in order to continue to provide such services.

        These services have a direct, positive impact on our patients. In
    the MSSP program in 2017, which is the most recent year for which we
    have finalized data, we reduced inpatient admissions per 1,000 patients
    by 3.4 percent when compared to 2016. We reduced our readmission rate
    from 16.3 percent to 14.25 percent, we reduced our emergency room (ER)
    utilization by 4.9 percent, and we reduced our per member per month
    spend on skilled nursing facilities by 9 percent. In total, we saved
    CMS $5.6 million on the nearly 15,000 beneficiaries we were accountable
    for that year. As significant as this may be on a population level, it
    is more impactful to understand how care is different, and better, on
    an individual patient level.

        Take patient A as an example. Patient A is a Medicare beneficiary
    in the MSSP program who was referred to the endocrinology clinic for
    uncontrolled diabetes. During the history and examination it was
    discovered that her blood sugar was four times normal and she was
    significantly dehydrated. Intravenous fluids and subcutaneous insulin
    were administered immediately in the clinic and the patient started to
    feel better. Upon further questioning, she said that she had not been
    exercising of late due to developing chest tightness and shortness of
    breath whenever she walked up an incline. A cardiology consult was
    immediately sought and the patient was transported across the hall to
    the cardiology clinic. There she had an EKG and echocardiogram that
    suggested she had unstable angina. An interventional cardiologist was
    called and advised his colleague to send Patient A to the local ER
    where he would admit her for a cardiac catheterization. That study
    revealed two blockages that were able to be stented and the patient was
    admitted for observation and discharged the next day. The series of
    events from office visit to catheterization occurred over the course of
    less than twelve hours because care was coordinated and provided in a
    multispecialty setting.

        Contrast Patient A with one of my relatives (Patient B) who obtains
    his medical care in a typical community setting. Patient B called his
    primary care physician complaining of worsening back pain. He was told
    to go to the ER because he had no open appointments that day. Upon
    arrival in the ER, he was given one dose of intravenous pain medication
    and waited 4 hours to see a physician. That physician did a cursory
    examination and told Patient B that he needed to make a follow-up with
    the on call orthopedic surgeon. The first available appointment was in
    2 weeks. At that appointment, the nurse told Patient B that the surgeon
    he was scheduled to see was a shoulder specialist, not a back
    specialist so he needed to reschedule his appointment since the back
    surgeon was not in the office that day. Two weeks later, Patient B
    finally saw the back specialist and was told that he needed surgery
    pending medical clearance. Since Patient B's primary care physician and
    cardiologist were in different practices from the orthopedic surgeon,
    it took nearly 6 weeks to obtain the necessary clearance for surgery.
    Luckily, the surgery went smoothly but Patient B was forced to remain
    in the hospital an extra day because there was confusion on who was
    supposed to discharge him. That extra time in the hospital resulted in
    a urinary tract infection that worsened Patient B's dementia and
    required an additional two days in the hospital and a brief stay in a
    skilled nursing facility (SNF) after discharge. Given the experiences
    of Patient A and Patient B, in which setting would you like your
    children or parents to receive care?
                      merit-based incentive payment system
        MIPS was designed as a transition tool--an on-ramp to value-based
    payment in the Medicare program. However, CMS has not implemented MIPS
    as Congress intended. Under MACRA, MIPS providers would have the
    opportunity to earn positive or negative payment adjustments based on
    their performance, starting at +/-4 percent in 2019 and increasing to
    +/-9 percent in 2023. By putting provider reimbursements at risk,
    Congress intended to move Medicare to a value-based payment model where
    high performance was rewarded and poor performers were incentivized to
    improve with lower payment rates.

        Despite Congress's goals, CMS has excluded nearly half of eligible
    clinicians from MIPS requirements through its MACRA regulations.
    Because MIPS is budget neutral, these exclusions result in
    insignificant payment adjustments to high-
    performing providers. For example, in 2020, CMS expects a 1.5-percent
    payment adjustment for high performers, compared to a potential 5-
    percent adjustment provided for in the law. And in 2021, CMS expects a
    2-percent payment adjustment for high performers, but the statute
    allows for a potential 7-percent adjustment. By excluding half of
    providers from MIPS, the system has devolved into an expensive
    regulatory compliance exercise with little impact on quality or cost.

        I understand my colleagues' concerns for physicians practicing in
    solo or smaller practices, and that the reporting burden on them is at
    times significant. However, we must recall that the MIPS program is a
    continuation of quality programs that have existed for years, namely
    the Physician Quality Reporting System (PQRS), the Value-Based Payment
    Modifier (VBM), and the Meaningful Use (MU) programs, where previously
    no one was excluded from participating--especially not half of eligible
    clinicians. In fact, under prior law, combined penalties for failure to
    participate in PQRS, VBM, and MU could be up to negative 11 percent.\1\
    Additionally, there is an opportunity for bonus points for high
    performers under MIPS.
    ---------------------------------------------------------------------------
        \1\ Statement of the American Medical Association to the U.S. House
    of Representatives Committee on Energy and Commerce Subcommittee on
    Health, Re: ``MACRA and MIPS: An Update on the Merit-based Incentive
    Payment System,'' July 26, 2018, https://energycommerce.
    house.gov/sites/democrats.energycommerce.house.gov/files/documents/
    Testimony-Barbe-%20HE
    -MACRA-and-MIPS-An-Update-on-the-Merit-based-Incentive-Payment-System-
    2018-07-26.pdf.

        Congress correctly anticipated that small and rural providers may
    need extra assistance and authorized funding in MACRA to provide that
    help. With this funding CMS created the Small, Underserved, and Rural
    Support initiative to provide free, customized technical assistance to
    clinicians in small practices. This serves both the small clinicians
    and the overall Medicare program better than simply excusing them from
    participation. If we want to be successful in moving our health-care
    system to value, policymakers should no longer exclude providers from
    participating in MIPS.
                   advanced alternative payment model program
        For Advanced APMs, the other pathway to value under MACRA, the
    system's requirements need to be revised to allow for increased APM
    participation. To qualify for the program, providers must meet or
    exceed minimum revenue thresholds from APMs, or minimum numbers of
    Medicare beneficiaries in these models. For example, for performance
    year 2019, in order to become a qualified participant, a provider must
    receive at least 50 percent of their Medicare Part B payments, or see
    at least 35 percent of Medicare patients through Advanced APMs. The
    threshold increases to 75 percent of revenue for performance year 2021.
    However, AMGA members report APM requirements are unrealistic, unlikely
    to be met, and will not attract the numbers of physicians and medical
    groups necessary to ensure the program's success.

        In order for more providers to transition to value, there is a need
    for Congress to offer meaningful incentives so providers will make the
    multimillion-dollar investments to build a value-based platform. By
    eliminating or revising these arbitrary thresholds, and extending the
    APM program beyond its 2024 sunset date, Congress would strongly
    demonstrate to the health-care community its commitment to offering a
    stable and predictable risk platform to providers ready to move to
    value.
    Accountable Care Organizations
        Participants in the Federal ACO program, like Crystal Run
    Healthcare, have been moving towards value while making improvements in
    care processes and the delivery of high-quality care, all while
    reducing healthcare utilization. However, ACOs have encountered
    significant obstacles in program design that threaten not only their
    own success, but also the future sustainability of the program. AMGA
    members have invested considerable financial, clinical, operational,
    and leadership resources to establish sophisticated care management
    infrastructures and organizational cultures necessary to support the
    goals of the ACO program. ACOs need a workable financing and
    operational structure that adequately incentivizes their move to value.
    In order to maintain the viability and structure of the ACO program,
    AMGA has several recommendations.

        Providers that willingly assume financial risk for a patient
    population require a consistent regulatory framework. In the ACO
    program, rules that shift depending on what level of risk is accepted
    is counterproductive, as the care delivery processes must change to
    adapt to new program rules. Lessons learned under one set of rules may
    not apply to a care process that must account for a different set of
    requirements or options. For example, rather than use payment waivers
    or beneficiary incentive programs as an incentive to take on risk,
    Congress should synchronize rules across all Federal ACO levels. This
    will allow providers who participate in the program to create delivery
    models that incorporate payment waivers such as the 3-day qualifying
    inpatient stay for SNF care and other post-discharge home-visit
    supervision requirements. Limiting these waivers or any beneficiary
    incentives to a subset of ACOs creates a situation that requires
    providers to adjust how they deliver care with no benefit to patients.
    Indeed, why patients should be required to stay in a hospital for three
    days or more before they are discharged to a SNF penalizes the patient
    for no other reason than a provider is in a different ACO level than
    another. The only meaningful difference in ACOs should be the level of
    financial risk a provider is willing to accept as an ACO moves up the
    risk continuum.

        Appropriate and accurate risk adjustment is a vital aspect of any
    performance-based program. When determining the risk adjustment factor,
    CMS has become overly concerned about coding efforts. Instead, the risk
    adjustment methodology should be chiefly concerned with the health
    status of the population assigned to the ACO. CMS uses Hierarchical
    Condition Category (HCC) prospective risk scores to account for changes
    in severity and case mix. It is possible that year-over-year the
    population's health status may improve. Conversely, it may worsen. As
    such, a risk adjustment factor should be concerned with just that: the
    health status of the ACO's beneficiaries.

        CMS's recent decision to set a 40-percent shared savings rate for
    ACO Basic Levels A and B only weakens financial incentives to move
    providers to risk. This level is insufficient and less than what was
    originally included in the MSSP. The levels of shared savings need to
    be increased to encourage participation and recognize the investments
    ACOs make.

        We should adjust ACO regional benchmarking so that they are not
    competing against themselves. Currently, CMS incorporates historical
    spending when resetting subsequent agreement period benchmarks.
    Historical spending should factor into a reset benchmark for those ACOs
    that are spending more than their region. These ACOs will then have the
    incentive to address their spending and align their costs to that of
    their region. However, those ACOs that have demonstrated an ability to
    deliver care below the regional cost should be evaluated against their
    region, as it would be increasingly difficult for an ACO to
    consistently perform better than its historical costs.

        Lastly, new repayment mechanisms should be provided for ACOs. As of
    2015, CMS no longer allows ACOs to purchase reinsurance policies as a
    repayment mechanism. Allowing for ACOs in two-sided risk-based
    contracts to purchase a reinsurance policy would allow them to mitigate
    significant financial losses.

        I truly believe Congress passed MACRA to drive the transition to
    value in Medicare Part B. However, since 2017, the first performance
    year for MIPS, we have clearly taken a step back from this transition,
    by excluding half of eligible clinicians from MIPS and enforcing
    arbitrary threshold requirements for Advanced APMs. Additionally,
    providers in the MSSP need one, and only one set of rules to follow.
    Creating different programmatic rules depending on which track a
    provide is on requires ACOs to develop new care processes based not on
    what is best for the patient, but rather by what CMS requires. On
    behalf of AMGA and Crystal Run Healthcare, we are ready to work with
    Congress and CMS to ensure that MACRA can serve its intended purpose in
    moving our Medicare system to value.

                                     ______

            Questions Submitted for the Record to Scott Hines, M.D.
                    Questions Submitted by Hon. Rob Portman
        Question. I introduced the Medicare Care Coordination Improvement
    Act with Senator Bennet in an effort to reduce some of the barriers
    that providers face when they participate in alternative payment
    models. However, one particular section of my bill focuses on providing
    temporary waivers to practices that are interested in testing their own
    APMs. HHS has been slow to take up new APM concepts, and thus: what can
    we do to incentivize the establishment of new APMs? Has the PTAC
    offered a viable way to propose and test new APMs? If not, what actions
    could be taken to encourage the adoption of PTAC models?

        Answer. In order to establish new APMs, Congress must offer
    meaningful incentives so providers will make the multimillion-dollar
    investments to build a value-based platform. By eliminating or revising
    the arbitrary thresholds, and extending the APM program beyond its 2024
    sunset date, Congress would strongly demonstrate to the health-care
    community its commitment to offering a stable and predictable risk
    platform to providers ready to move to value. Synchronizing rules
    across all APMs would also incentivize their establishment.

        Current APM participants, like those in the Federal Accountable
    Care Organization (ACO) program, have made significant improvements in
    care processes and the delivery of high-quality care, while reducing
    health-care utilization. Although many ACOs have improved the quality
    of care and saved Medicare dollars, program results have been uneven at
    best. ACOs have encountered significant obstacles in program design
    that threaten not only their own success, but also the future viability
    of this program.

        AMGA members have invested significant financial, clinical,
    operational, and leadership resources to establish sophisticated care
    management infrastructures and organizational cultures necessary to
    support the goals of the ACO program. They have done so because it is
    the right thing to do for their patients and they want to assist
    Congress, the Centers for Medicare and Medicaid Services (CMS), and
    other payers to create the new payment models that reward coordinated,
    patient-centered care with measurable outcome improvements. To achieve
    that goal, ACOs need a workable financing and operational structure
    that adequately incentivizes this important work.

        Question. Per data from CMS, about half of all Medicare providers
    are participating in MIPS, with the majority of these non-participating
    providers being exempt via the low-volume threshold. While we don't
    want to place additional burdens on small and rural providers, we
    should be identifying ways to engage with these practices to help them
    transition towards value-based outcomes.

        What actions should be taken to engage with these providers?

        Answer. We understand the concerns for physicians practicing in
    rural or small practices that the reporting burden on them is at times
    significant. However, the MIPS program is a continuation of quality
    programs that have existed for years, namely the Physician Quality
    Reporting System (PQRS), the Value-Based Payment Modifier (VBM), and
    the Meaningful Use (MU) programs, where previously no one was excluded
    from participating--especially not half of eligible clinicians. In
    fact, under prior law, combined penalties for failure to participate in
    PQRS, VBM, and MU could be up to negative 11 percent. In addition to
    these legacy quality programs that have been around for 10 years, when
    MACRA passed in 2015 it gave doctors 4 years of 0.5 percent automatic
    updates to get ready to participate. There is also an opportunity for
    bonus points for high performers under MIPS.

        Congress correctly anticipated that small and rural providers may
    need extra assistance and authorized funding in MACRA to provide that
    help. With this funding, CMS created the Small, Underserved, and Rural
    Support initiative to provide free, customized technical assistance to
    clinicians in small practices. This serves both the small clinicians
    and the overall Medicare program better than simply excusing them from
    participation. MACRA should be implemented as the statute requires and
    policymakers should no longer exclude providers from participating in
    MIPS.

                                     ______

                     Questions Submitted by Hon. Ron Wyden
        Question. The Independence at Home demonstration, which was
    expanded and extended last year through the CHRONIC Care Act, enables
    care teams to deliver high-quality primary care to Medicare
    beneficiaries in the comfort of their own homes. In its third
    performance year, according to the Centers for Medicare and Medicaid
    Services (CMS), Independence at Home saved $16.3 million for the
    Medicare program.\1\ A recent evaluation also found that Independence
    at Home has resulted in fewer emergency department visits leading to
    hospitalization, a lower proportion of beneficiaries with at least one
    unplanned hospital readmission during the year, and a reduced number of
    preventable hospital admissions.\2\
    ---------------------------------------------------------------------------
        \1\ https://innovation.cms.gov/Files/fact-sheet/iah-yr3-fs.pdf.
        \2\ https://innovation.cms.gov/Files/reports/iah-rtc.pdf.

        As I mentioned at the hearing, I am committed to building on the
    success of the Independence at Home demonstration. As discussed at the
    hearing, I understand that the new Primary Care First model recently
    announced by CMMI (the Center for Medicare and Medicaid Innovation at
    CMS) may provide an avenue to expand access to home-based primary care
    ---------------------------------------------------------------------------
    for more Medicare beneficiaries.

        Based on your members' experience in Independence at Home and other
    alternative payment models, what key components will be necessary in
    order for the Primary Care First model to expand access to home-based
    primary care?

        Answer. We are looking forward to reviewing the details of the
    Primary Care First model when the Centers for Medicare and Medicaid
    Services issues its Request for Applications later this year. In any
    value-based model of care, however, there are some key features that
    providers will need to have the best opportunity to succeed. In order
    for the Primary Care First model to expand access to home-based primary
    care, incentives for providers must exist. I also would recommend that
    Congress eliminate the arbitrary APM threshold requirements so that
    more providers will qualify as an Advanced Alternative Payment Model
    under the Quality Payment Program. In addition, the APM program should
    be extended beyond 2024.

        Lack of access to administrative claims data also is a barrier to
    the success of these payment models. AMGA members report that while
    some payers share this data with them, the majority of payers do not.
    Without this data, it is challenging to manage the cost and quality of
    a population of patients, which is a goal of moving to value-based
    care. Congress should require Federal and commercial payers to provide
    accurate, timely access to all administrative claims data to health-
    care providers in value-based arrangements.

        Question. What other specific policies would you recommend Congress
    or CMS consider to expand access to home-based primary care for more
    Medicare beneficiaries?

        Answer. Additionally, we recommend Congress or CMS consider
    expanding telehealth, eliminating the 20 percent Chronic Care
    Management cost-sharing requirement, and decreasing administrative
    burden and providing regulatory relief for participants in these
    models.

        Question. As I mentioned during the hearing, I often hear from
    seniors in Oregon that they don't feel like anyone is in charge of
    managing their health care and helping them navigate the health-care
    system. I am proud of the bipartisan work that this committee did on
    the CHRONIC Care Act last Congress to update the Medicare guarantee. In
    my view, the next step should be making sure that all Medicare
    beneficiaries with chronic illnesses have someone running point on
    their health care--in other words, a chronic care point guard--
    regardless of whether they get their care through Medicare Advantage
    (MA), an accountable care organization (ACO) or other alternative
    payment model, or traditional fee-for-service Medicare.

        For beneficiaries in traditional, fee-for-service Medicare, what
    can be done to improve care coordination and make sure their physicians
    and other health-care professionals are all talking to each other and
    working together to provide the best possible care to those
    beneficiaries? What specific policies would you recommend this
    committee pursue toward that end?

        Answer. To improve care coordination, we recommend continued
    efforts by Congress to reduce Medicare's regulatory burden by linking
    regulatory reform efforts to providers participating in value-based
    payment models. For example, Federal legislation and regulations
    governing physician self-referral, collectively termed the ``Stark
    Law,'' were intended to prevent financial conflicts of interest around
    physician self-referrals in fee-for-service (FFS) settings. As Medicare
    transitions to value-based arrangements, the need for these protections
    and related self-referral and anti-kickback regulations lessen, as
    incentives to over-utilize health-care services diminish.

        Participants in the MSSP or ACO program often have to receive
    several fraud and abuse waivers since the financial incentives push
    providers to improve the continuity, coordination, and continuum of
    care for assigned ACO beneficiaries. The Stark Law's prohibitions,
    which were drafted 30 years ago, impede the physician-hospital
    relationships necessary to address overuse of services. The Stark Law
    was drafted to address volume of service increases in FFS Medicare. It
    has virtually no application in value models, which incentivize
    appropriate use of services. This law should be updated to account for
    changes in care models that have led to more integrated care delivery.

        Question. Please describe the specific steps that Congress and/or
    CMS could take to ensure all Medicare beneficiaries with chronic
    illnesses, including those in traditional fee-for-service Medicare,
    have a chronic care point guard.

        Answer. The recent legislation to waive the cost-sharing
    requirements of Medicare's Chronic Care Management (CCM) code is a
    great example of putting the idea of a chronic care point guard into
    practice. CCM is a critical part of coordinated care, and as a result,
    Medicare began reimbursing physicians for CCM under a separate code in
    the Medicare Physician Fee Schedule. As you are aware, this code is
    designed to reimburse providers for non-face-to-face care management.
    We support this initiative to further manage chronic care conditions to
    improve the health of patients.

        The creation of a separately billable code, however, created a
    beneficiary cost-sharing obligation for care management services. Under
    current policy, Medicare beneficiaries are subject to a 20 percent
    coinsurance requirement to receive the service. This cost-sharing
    requirement creates a barrier to care, as beneficiaries are not
    accustomed to sharing the cost for care management services.
    Consequently, only 684,000 out of 35 million Medicare beneficiaries
    with two or more chronic conditions benefited from CCM services over
    the first 2 years of the payment policy.

        AMGA supports the legislation to waive the beneficiary coinsurance
    amount to facilitate further appropriate management of chronic care
    conditions to improve the health of patients. Providers and care
    managers, who would fulfill the role of the chronic care point guard,
    report many positive outcomes for beneficiaries who receive CCM
    services, including improved patient satisfaction and adherence to
    recommended therapies, improved clinician efficiency, and decreased
    hospitalizations and emergency department visits.

        Question. Eligible clinicians who receive a certain percentage of
    their payments or see a certain percentage of their patients through
    Advanced APMs are excluded from MIPS and qualify for the 5 percent
    incentive payment for payment years 2019 through 2024. Starting this
    year (performance year 2019), eligible clinicians may also become
    qualifying APM participants (and thus qualify for incentive payments in
    2021) based in part on participation in Other Payer Advanced APMs
    developed by non-Medicare payers, such as private insurers, including
    Medicare Advantage plans, or State Medicaid programs.

        Recognizing that this is the first year in which the All-Payer
    Combination Option is available, how many of your members do you
    anticipate will take advantage of the All-Payer Combination Option this
    year?

        Answer. We do not have the data available to answer at this time
    but we would expect that very few of our members are able to take
    advantage of this because, based on our risk surveys, commercial payers
    are not offering an adequate amount of risk based contracts in many
    markets.

        Question. What, if any, challenges have your members faced when
    attempting to take advantage of the All-Payer Combination Option?

        Answer. Not applicable.

        Question. In the Medicare Access and CHIP Reauthorization Act of
    2015 (MACRA), Congress provided a total of $100 million over 5 years
    for technical assistance to MIPS-eligible clinicians in practices with
    15 or fewer clinicians, focusing on rural and health professional
    shortage areas.

        To what extent have your members utilized the services of the
    Small, Underserved, and Rural Support Initiative, which CMS launched
    using the MACRA funding to provide free, customized technical
    assistance to clinicians in small practices?

        Answer. AMGA members have been preparing for the transition to
    value so we did not require additional assistance from the government
    to follow the MACRA statute.

        Question. What types of technical assistance and support have been
    most helpful to physicians and practices (e.g., understanding program
    requirements, selecting appropriate measures, forming virtual groups)?

        Answer. Not applicable.

        Question. As physicians continue to gain experience with the
    Quality Payment Program, what additional types of technical assistance
    would be most helpful to solo practitioners and physicians in small
    practices and/or to those practicing medicine in rural or underserved
    areas?

        Answer. Additional technical assistance that would be helpful to
    solo practitioners and physicians in small practices or rural areas
    would be incentives to report quality measures while participating in
    the MIPS program.

                                     ______

                  Questions Submitted by Hon. Debbie Stabenow
        Question. You mentioned the Small, Underserved, and Rural Support
    Initiative in your testimony. What have you heard from your members and
    colleagues about the effectiveness of this funding for assisting rural
    practices, and how do you think it could be improved?

        Answer. Not applicable.

        Question. I am very proud of the work the bipartisan
    accomplishments to address Alzheimer's, including the implementation of
    my HOPE for Alzheimer's Act which required Medicare to pay for new
    individual care plans to support Alzheimer's patients and their
    families. Many of my colleagues are also cosponsors of my Improving
    HOPE for Alzheimer's Act, which will ensure beneficiaries and
    physicians know that they are able to access, and bill for, care
    planning under Medicare. In our last hearing on MACRA implementation,
    my colleagues raised the question of how we should look at quality
    measures in MIPS when it comes to physicians having these conversations
    with beneficiaries and their families and reflecting their priorities.
    Some have mentioned altering MIPS to make the quality measures more
    clinically meaningful. In what ways do you think the system would need
    to change to better incorporate long-term care planning and encourage
    physicians to have these conversations with patients?

        Answer. To begin, over 50 percent of eligible clinicians should not
    be excluded from participation in MIPS. For the quality measures to
    truly be more clinically meaningful, patients must receive care from
    providers that actually report these measures.

        In addition, AMGA has endorsed a set of value measures designed to
    simplify the reporting process and limit the burden on providers and
    group practices, while still reporting clinically relevant and
    actionable data. The 14 measures were selected to address the flaws
    with the current quality measurement and reporting system, which
    suffers from duplicative measures and a lack of data standardization.
    AMGA believes that the use of this set of core measures will ultimately
    save providers' time and reduce costs while improving care.

        The 14 measures are:

             1.  Emergency Department use per 1,000.
             2.  SNF admissions per 1,000.
             3.  30-day all cause hospital readmission.
             4.  Admissions for acute ambulatory sensitive conditions
            composite.
             5.  HbA1C poor control > 9 percent.
             6.  Depression screening.
             7.  Diabetes eye exam.
             8.  Hypertension (HTN)/high blood pressure control.
             9.  CAHPS/health status/functional status.
            10.  Breast cancer screening.
            11.  Colorectal cancer screening.
            12.  Cervical cancer screening.
            13.  Pneumonia vaccination rate.
            14.  Pediatric well child visits (0-15 months).

                                     ______

                   Questions Submitted by Hon. Sherrod Brown
                           the patient voice in macra
        Question. As I mentioned in my hearing questions, we passed MACRA
    to incentivize and reward high-value, patient-centered care. While
    MACRA is all about physician payment reform, our goal should be
    maximizing patient benefit. It is clear to me that we have not done
    enough to ensure the patient's voice is a part of the process, and that
    patients are benefiting from these changes. The NIH has created
    Patient-Focused Therapy Development tools and systems dedicated to
    engaging the patient community throughout the translational science
    process. The FDA has implemented a Patient-Focused Drug Development
    model to help ensure patients' experiences, perspectives, needs, and
    priorities are captured meaningfully during drug development and
    review.

        In your testimony, you shared the story of a relative who got
    caught in the health-care system's inefficiencies. Unfortunately, I
    hear similar stories from Ohioans far too often. What more can and
    should we do to ensure both MIPS and APM programs prioritize and value
    patient satisfaction?

        Answer. MACRA must be allowed the chance to work by being
    implemented as originally intended. You will never move the needle
    towards a value-based health-care system that values patient
    satisfaction when half of eligible clinicians are excluded from
    participation in MIPS. The APM system's requirements need to be revised
    to allow for increased APM participation as well, such as eliminating
    the arbitrary threshold requirements.
                        development of metrics in macra
        Question. I have heard from a number of physicians who believe that
    there is no link between many of the MIPS measures they are required to
    report and improving clinical care for their patients. I understand
    that the physician community has engaged with CMS to try and make the
    program more meaningful to physicians and patients through more
    relevant quality measures.

        How are clinicians from your organization involved the creation of
    these measures relevant to their specialties?

        Has CMS been receptive to your feedback when provided?

        How would you assess CMS's collaboration on achieving meaningful
    metrics?

        Are there any changes in this process you would recommend?

        Answer. We are encouraged by CMS's efforts with the meaningful
    measures initiative. To help with this effort, AMGA endorsed a set of
    value measures designed to simplify the reporting process and limit the
    burden on providers and group practices, while still reporting
    clinically relevant and actionable data.

        The 14 measures were selected to address the flaws with the current
    quality measurement and reporting system, which suffers from
    duplicative measures and a lack of data standardization. AMGA members
    report hundreds of different quality measures to various public and
    private payers, the vast majority of which are not useful in evaluating
    or improving the quality of care provided. There is a significant cost
    to measure reporting. Research has indicated that, on average, U.S.
    physician practices across four common specialties annually spend more
    than $15.4 billion and 785 hours per physician to report quality
    measures.

        AMGA believes that the use of this set of 14 core measures will
    ultimately save providers' time and reduce costs while improving care.
    By offering a standard set of measures for value-based contracts with
    payers, the AMGA measure set will reduce the variation in the measures
    that are reported and help eliminate unnecessary confusion and
    administrative burden. The measurement set includes both process
    measures, such as cancer screening and immunization rates, which focus
    attention on quality improvement, and outcome measures, which emphasize
    the need to evaluate how care is provided to best drive quality
    improvement.

                                     ______

                 Questions Submitted by Hon. Sheldon Whitehouse
        Question. Accountable Care Organizations (ACOs) have the potential
    to transform our health care delivery system. While we've seen ACOs
    improve patient care and create shared savings, many provider-led ACOs
    only control a small fraction of total spending, with specialists,
    pharmaceuticals, and hospitals accounting for most of it. This leads to
    ACOs lacking sufficient leverage to bring down costs and can contribute
    to shared losses.

        How can we improve the ACO model to account for this imbalance? How
    can we support successful ACOs and encourage more providers to follow
    their lead?

        Answer. In order to improve the ACO model and support successful
    ACOs, AMGA recommends the following: synchronize rules across all
    Federal ACO levels; reduce regulatory burdens on ACOs; increase the
    Shared Savings Rate to incentivize participation in the program; adjust
    MSSP ACO regional benchmarking so that they are not competing against
    themselves; and provide for new repayment mechanisms for ACOs.

        Question. Our health-care system is not fully equipped to care for
    an aging population and patients with advanced illness such as late-
    stage cancer, Alzheimer's disease or dementia, or congestive heart
    failure. This is an area where we need new models of care that reflect
    these challenges and create a better system for providers, patients,
    and their families. Many of our current Medicare rules in this space
    are counterproductive, such as requiring a two night, three-day stay in
    an inpatient facility to qualify for skilled nursing care, and various
    disincentives to providing respite or palliative care. How are your
    organizations innovating to provide care for these patients, and what
    can Congress and CMS do to support those efforts?

        Answer. Policy-makers should waive the 3-day qualifying inpatient
    stay for skilled nursing facility (SNF) care and implement policies
    that encourage providers to work with their patients to provide
    services in the most clinically appropriate location.

        The Social Security Act requires Medicare beneficiaries to have an
    inpatient hospital stay of no fewer than 3 consecutive days to be
    eligible for Medicare coverage of SNF care. This rule dates back to the
    inception of the Medicare program, and is referred to simply as the SNF
    3-Day Rule. The 3-day stay is not required for other forms of post-
    acute care, including home health care or inpatient rehabilitation
    facility stays. Today, under pay-for-value arrangements, the 3-Day Rule
    has become, as the Medicare Payment Advisory Commission (MedPAC)
    previously noted, ``antiquated.''

        Question. Despite continued investment, electronic health records
    (EHRs) remain difficult to share, challenging for patients to access,
    and a source of frustration to providers and policymakers alike. The
    business models of the EHR venders often leads to perverse incentives
    against sharing patient information.

        What steps can Congress take to make EHRs work better for
    providers? Are the proposed data blocking rules enough to start
    encouraging better data sharing by the vendors?

        Answer. In our May 2016 principles for interoperability, AMGA
    stressed the need to help providers share a patient's health
    information between each other and the patient and not block the
    exchange of electronic health information. As we strive for a health-
    care system that rewards value over volume, the need to ensure this
    information is freely exchanged becomes even more important.
    Information-blocking practices are contrary to a desired well-
    coordinated healthcare delivery system because sharing information
    seamlessly across the care continuum is fundamental to moving toward a
    patient-centered, high-performing delivery system. As such, the
    exceptions to the information-blocking provisions outlined in the
    recent ONC interoperability proposed rule are adequate and no
    additional exceptions are warranted.

        Question. How can we encourage States to be better innovators on
    health-care spending? The current Medicaid waivers incentivize States
    to keep costs down, but are there ways to encourage both lower costs
    and better health-care outcomes?

        Answer. A shift toward a value-based approach and away from the
    fee-for-service system is the most effective way to lower overall costs
    while encouraging better health-care outcomes. We need to align
    payments with the goals of the health-care system, and the best way to
    do this is to reduce the barriers to success in value-based care
    arrangements. If it were simpler for practices to participate and
    succeed in risk, more would adopt the models that incentivize
    outcomes--better care quality, improved patient experience, and lower
    costs--rather than volume of services provided.

                                     ______

                   Questions Submitted by Hon. Maggie Hassan
        Question. We spoke during the hearing about the incentive payment
    for providers to improve tracking and reporting of opioid prescribing,
    treatment agreements,
    follow-up evaluations, and screening of patients who may be at risk of
    opioid misuse under the Medicare Access and Children's Health Insurance
    Program (CHIP) Reauthorization Act of 2015 (MACRA).

        This data has the potential to improve treatment for substance use
    disorder, which is why its collection and reporting is now incentivized
    through increased reimbursement.

        At the hearing, I asked for feedback on the impact this data
    collection and reporting has had on treatment of patients, particularly
    as it relates to any reduction in opioid misuse.

        Based on your response, it seems that there may be additional steps
    the Centers for Medicare and Medicaid Services (CMS) could take so that
    this aggregated, de-identified data can be used to benefit patients and
    improve care.

        Do you have specific suggestions on how CMS can improve the
    collection, use, and dissemination of opioid prescribing and treatment
    data sets in ways that would directly benefit patients at their site of
    care, specifically as it relates to identifying best practices to
    reduce opioid misuse?

        Answer. CMS can improve the collection, use, and dissemination of
    opioid prescribing and treatment data sets in ways that would directly
    benefit patients at their site of care, specifically as it relates to
    identifying best practices to reduce opioid misuse, by supporting 42
    CFR part 2 reform efforts.

        42 CFR part 2 requires limiting the use and disclosure of patients'
    substance use records from certain substance use programs. Under
    current law, a patient must provide written authorization permitting
    each individual provider access to their substance use disorder
    records. A lack of access to the full scope of medical information for
    each patient can result in the inability of providers and organizations
    to deliver safe, high-quality treatment and care coordination. The
    Health Insurance Portability and Accountability Act (HIPAA) grants
    providers access to a wide range of patient data to manage population
    health, while still maintaining patient privacy protections. AMGA
    requests that Congress align the 42 CFR part 2 law with HIPPA to alter
    access to patients' substance use information. This policy proposal
    would grant providers access to this data to manage population health,
    while still maintaining patient privacy protections, such as
    identifying opioid misuse.

                                     ______

               Questions Submitted by Hon. Catherine Cortez Masto
        Question. In 2011, REMSA, an EMS provider in Northern Nevada,
    received innovation grant funding from CMMI. The program was incredibly
    successful--they avoided re-hospitalizations, and improved county-wide
    health outcomes. In addition, they saved $9 million for the Medicare
    program. In 2020, CMS will launch ET3, a national model based on the
    REMSA program.

        Do we have an adequate process to transition demonstrations from
    innovation grantees to national models?

        Answer. At this time, I am not certain that we do have an adequate
    process.

        One example is participants in the Federal Accountable Care
    Organization (ACO) program, which has made significant improvements in
    care processes and the delivery of high-quality care, while reducing
    health-care utilization. Although many ACOs have improved the quality
    of care and saved Medicare dollars, program results have been uneven at
    best. ACOs have encountered significant obstacles in program design
    that threaten not only their own success, but also the future viability
    of this program.

        Question. What are some of the lessons from the success of your
    larger practices in complying with MIPS or transitioning to APMS? Are
    they applicable to small and rural groups that are eligible for
    technical assistance? If so, how can we share them with those groups?

        Answer. Crystal Run Healthcare was founded in 1996 in Orange County
    New York, which is three counties north and west of New York City. This
    is a fairly rural region, but in 2002, we expanded one county north to
    Sullivan County, which is rural and underserved. We recruited 40
    providers and built a 60,000 square foot facility that houses physician
    offices, a lab, radiology and urgent care. Those rural and underserved
    patients were able to experience the benefits of coordinated care in an
    integrated model similar to that of most AMGA member organizations.

        With the proper incentives, such as eliminating MIPS exclusions and
    eliminating arbitrary APM thresholds and possibly others, providers in
    rural areas could work with larger organizations to be able to tap into
    this model of care. Rather than preserving the status quo (a broken,
    uncoordinated, expensive fee-for-service system), we should be
    incentivizing rural providers to collaborate with organizations that
    have experience delivering care in this new manner. This is not to say
    that rural providers need to join larger entities. Each provider can
    decide for themselves what the nature of that relationship should be.
    However, if the incentives are adequate integration will occur.

                                     ______

                Prepared Statement of Barbara L. McAneny, M.D.,
                    President, American Medical Association
        The American Medical Association (AMA) appreciates the opportunity
    to present our views to the U.S. Senate Committee on Finance. As the
    largest professional association for physicians and the umbrella
    organization for State and national specialty medical societies, the
    AMA has invested heavily in efforts to achieve successful
    implementation of the Medicare Access and CHIP Reauthorization Act of
    2015 (MACRA).

        Since the enactment of MACRA, the AMA has worked closely with both
    Congress and the Centers for Medicare and Medicaid Services (CMS) to
    promote a smooth implementation of the Merit-Based Incentive Payment
    System (MIPS) and Alternative Payment Models (APMs) under the Quality
    Payment Program (QPP). We continue to believe that MACRA represents an
    improvement over the flawed sustainable growth rate (SGR) payment
    methodology. However, the implementation of a new Medicare quality and
    payment program for CMS and physicians has been a significant
    undertaking, and further refinements are still needed to improve the
    program and reduce administrative burden for physicians.

        MACRA included modest positive payment updates in the Medicare
    Physician Fee Schedule, but it left a 6-year gap from 2020--next year--
    through 2025 during which there are no updates at all. Following this
    6-year freeze, the law specifies physician payment rate updates of 0.75
    percent or 0.25 percent for physicians participating in APMs or MIPS,
    respectively. By contrast, other Medicare providers will continue to
    receive regular, more stable updates.

        The recent ``2019 Annual Report of the Board of Trustees of the
    Federal Hospital Insurance and Federal Supplementary Medical Insurance
    Trust Funds'' (``Medicare Trustees Report'') found that scheduled
    physician payment amounts are not expected to keep pace with the
    average rate of physician cost increases, which are forecast to average
    2.2 percent per year in the long range. The Medicare Trustees Report
    also found that ``absent a change in the delivery system or level of
    update by subsequent legislation, the Trustees expect access to
    Medicare-participating physicians to become a significant issue in the
    long term.''\1\ The AMA agrees and urges Congress to replace the
    upcoming physician payment freeze with annual positive payment updates
    over the next several years to provide physicians with a stable and
    sustainable revenue source that allows them a margin to invest in
    practice improvements in order to transition to more efficient models
    of care delivery to better serve Medicare patients.
    ---------------------------------------------------------------------------
        \1\ U.S. Department of Health and Human Services, Centers for
    Medicare and Medicaid Services. (April 22, 2019). ``2019 Annual Report
    of the Board of Trustees of the Federal Hospital Insurance and Federal
    Supplementary Medical Insurance Trust Funds.'' Retrieved from https://
    www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-
    Reports/Reports
    TrustFunds/Trustees-Reports-Items/2016-2019.html.

        One goal of MACRA was to provide physicians with a glide path to
    transition into APMs. To help facilitate this transition, Congress
    provided a 5-percent bonus for physicians who participate in Advanced
    APMs during the first 6 years of the program. Unfortunately, through
    the first 3 participation years--half the time this bonus was to be
    available--few physicians have had the opportunity to participate in
    Advanced APMs. Consequently, the AMA is urging Congress to extend the
    Advanced APM bonus payments to fulfill Congress's original intent and
    ---------------------------------------------------------------------------
    provide support to physicians as they transition to new payment models.

        In addition to a sustained glide path to allow physicians to
    transition to APMs, the AMA urges Congress and CMS to continue to make
    MIPS more meaningful for physicians. We hear from our physician members
    that there is no link between many of the MIPS measures they are
    required to report and improving clinical care for their patients. The
    AMA has engaged the physician community through workgroups to develop
    creative solutions to simplify and streamline the QPP, while making it
    more meaningful for physicians. We look forward to working with
    Congress and CMS to implement some of these creative solutions and
    continue to improve MIPS.
                        improvement over legacy programs
        The AMA was supportive when Congress replaced the flawed, target-
    based SGR formula with a new payment system under MACRA in 2015.
    Scheduled payment cuts prior to the implementation of MACRA exceeded 20
    percent. Those cuts would have had a devastating impact on physician
    practices and patient access to care. Under MACRA, the SGR formula was
    replaced with specified payment updates for 2015 through 2019 and for
    2026 and beyond. MACRA also created an opportunity to address problems
    found in existing physician reporting programs. In addition, the law
    sought to promote innovation by encouraging new ways of providing care
    through APMs.
    Support for Technical Corrections
        The AMA strongly supported the changes to MACRA in the Bipartisan
    Budget Act of 2018 (BBA18). These technical changes helped many
    practices avoid penalties that they likely would otherwise have
    incurred under the MIPS program. Specifically, we commend Congress for
    excluding Medicare Part B drug costs from MIPS payment adjustments, as
    including these additional items and services created significant
    inequities in the administration of the MIPS program. In addition, we
    appreciate the flexibility given to CMS to reweight the Cost
    performance category to not less than 10 percent for the 3rd, 4th, and
    5th years of MIPS, and to set the performance threshold for 3
    additional years. As Congress intended, we believe the goal of the
    program should be to help physicians succeed, not to cause physicians
    to fail, and we believe these technical changes, along with other
    changes, will allow CMS to increase the program requirements gradually
    and transition to a more meaningful program over time.

        We also appreciated the BBA18 provision that allowed the Physician-
    focused Payment Model Technical Advisory Committee (PTAC) to provide
    initial feedback to proposal submitters. Unfortunately, the PTAC has
    indicated that it is still not able to provide technical assistance and
    data analyses to stakeholders who are developing proposals for its
    review. Additional technical corrections may be needed to provide the
    PTAC with more flexibility in this regard.
    Support for Small and Rural Practices
        The AMA appreciates the accommodations for small practices that are
    included MIPS. Specifically, the low-volume threshold exemption
    excludes numerous small practices or physicians who see very few
    Medicare patients. In 2018, physicians with annual Medicare allowed
    charges of $90,000 or less or 200 or fewer Medicare patients were
    exempt from the QPP altogether. In 2019, CMS extended the low-
    volume threshold to physicians who provide 200 or fewer covered
    professional services to Medicare Part B beneficiaries. The AMA has
    also supported reduced reporting requirements for small practices,
    hardship exemptions from the Promoting Interoperability MIPS
    performance category for qualifying small practices, bonus points for
    small practices, and technical assistance grants to help small and
    rural practices succeed in the program.

        Despite these improvements, the AMA and our physician members still
    have significant concerns regarding the ability for small and rural
    practices to succeed in the MIPS program. In 2017, the national mean
    and median scores for all MIPS eligible clinicians were 74.01 and 88.97
    points. However, the mean and median scores for rural and small
    practices were 43.46 and 37.67, and 63.08 and 75.29, respectively.
    Given the lower scores achieved by small and rural practices compared
    to all MIPS eligible clinicians, the AMA urges Congress and CMS to
    continue to implement policies that help small and rural physician
    practices succeed in MIPS.
                              glide path into apms
    Extend the Advanced APM Bonus
        MACRA was intended to create a gradual glide path to move
    physicians into more innovative value-based care payment models.
    Changing the way physicians deliver care requires significant
    investment into new technologies and workflow systems. In order to help
    physicians implement these changes, MACRA provided a 5-percent bonus
    for the first 6 years of the program for physicians who participate in
    an Advanced APM. These bonus payments were intended to create a margin
    for physicians to invest in changing the way they deliver care. We
    heard from many physician groups who were excited to take advantage of
    the opportunity to move to an Advanced APM.

        Unfortunately, there were a limited number of Advanced APMs in
    which physicians could participate during the first 3 MACRA performance
    years, and there are only 3 years left in the program for physicians to
    receive an APM bonus. The dearth of Advanced APMs available for
    physicians limited their ability to take advantage of the APM bonus
    that Congress provided to assist physicians with moving to new,
    innovative payment models.

        The AMA is greatly encouraged by the recent steps taken by
    Department of Health and Human Services Secretary Azar, CMS
    Administrator Verma, and Center for Medicare and Medicaid Innovation
    (CMMI) Director Boehler. They are working to implement and further
    develop new models based on stakeholder proposals to the PTAC. We
    believe there will be increased opportunities for physicians in various
    practice group sizes and specialties to participate in Advanced APMs as
    CMMI continues to release new models. However, given the small number
    of physicians who have been eligible to receive the APM Qualified
    participant (QP) bonus to date, the AMA strongly urges Congress to
    extend the APM bonus for an additional 6 years to provide physicians a
    realistic onramp to participation in value-based care. As CMMI
    continues to test and develop new models, the AMA hopes that physicians
    will have access to APMs that give them the resources and flexibility
    to redesign the delivery of patient care and support their efforts to
    achieve good health outcomes.
    Modify Thresholds to Achieve QP Status
        In addition to extending the period of time that the QP bonus
    payments are available to APM participants, the AMA recommends that
    Congress revisit the payment thresholds set by MACRA. Under current
    law, these thresholds escalate from 25 percent to 75 percent of APM
    participant revenues over a 5-year period. Many APM participants are
    concerned that these thresholds are too high, especially for episode-
    based APMs. MACRA set the payment thresholds but gave limited authority
    to CMS to set patient thresholds to achieve QP status. The AMA
    recommends that CMS' statutory authority be expanded so it can set both
    the payment and patient thresholds for QP status and could set
    different thresholds for different types of APMs.
    Further Improvements Are Needed
        The AMA urges Congress to make additional technical changes to
    MACRA to simplify the program and make reporting more clinically
    meaningful for physicians. We were pleased CMS established transition
    policies for the first year of MIPS and, as a result, 93 percent of
    eligible clinicians received a modest positive payment adjustment and
    nearly three-quarters qualified for an additional exceptional
    performance bonus. However, we continue to hear from physicians that
    the program needs to be streamlined and more clinically relevant. To
    assist Congress and CMS in making the program cohesive and meaningful
    to physicians and patients, the AMA convenes MIPS and APM workgroups
    made up of representatives from across the physician community, which
    have developed creative solutions to improve the QPP. These solutions
    include ways to simplify scoring, create more integrated approaches to
    reporting across performance categories, and improve the physician
    reporting experience.

        For example, Congress and CMS can make MIPS more cohesive and
    meaningful to physicians and patients by allowing physicians to focus
    their participation around a specific procedure, condition, or public
    health priority. By allowing physicians to focus on activities that fit
    within their workflow and address their patient population needs,
    rather than focusing on segregated activities that fit into the four
    disparate MIPS categories, the program could improve the quality of
    care and be more meaningful and less burdensome for physicians. The AMA
    has worked closely with the physician community to develop a
    streamlined MIPS participation option that would hold physicians
    accountable for the cost and quality of care around a specific episode.
    For instance, a cardiologist could participate in a MIPS episode
    evaluating cost and quality using valid and reliable measures, as well
    as health IT use, around Percutaneous Coronary Intervention procedures
    and primary care physicians could focus on lowering costs and improving
    quality by maximizing patient engagement through a Patient-Centered
    Medical Homes. This participation option in MIPS would also be a bridge
    to APMs by giving physicians an opportunity to gain experience and see
    their data before taking on financial risk in a bundled payment or
    advanced primary care model.

        Additional suggestions for technical changes to improve MACRA from
    the work groups include:

              Updating the Promoting Interoperability performance category
            to allow physicians to use certified electronic health record
            technology (CEHRT) in more clinically relevant ways;
              Developing a separate threshold for small and rural
            practices to ensure a level playing field for all physicians;
              Prioritizing cost measures that are valid and actionable and
            that have stronger correlation between costs and the
            physicians' influence over those costs;
              Incentivizing reporting on new quality measures, especially
            specialty developed and recommended measures;
              Eliminating the requirement to set the performance threshold
            at the mean or median so CMS, rather than a pre-set formula,
            can determine whether physicians are ready to move to an
            increased threshold based on available data; and
              Aligning and improving the methodologies of MIPS
            calculations and Physician Compare. Currently, physicians
            receive two different scores and reports, which is confusing to
            physicians and patients and does not lead to quality
            improvement.

        The QPP is a complex program that remains complicated for CMS to
    implement and difficult for physicians to understand; however, the AMA
    is confident that if Congress, CMS, and the medical community continue
    to work together to improve the program, we can ensure physicians have
    the opportunity to be successful and provide high-value care to
    patients.

        The AMA remains committed to ensuring that the MACRA program is
    successful. We appreciate the opportunity to provide our comments on
    the current MACRA program, and look forward to continuing to work with
    the committee and CMS to make further refinements to the program.

                                     ______

         Questions Submitted for the Record to Barbara L. McAneny, M.D.
                    Questions Submitted by Hon. Rob Portman
        Question. I introduced the Medicare Care Coordination Improvement
    Act with Senator Bennet in an effort to reduce some of the barriers
    that providers face when they participate in alternative payment
    models. However, one particular section of my bill focuses on providing
    temporary waivers to practices that are interested in testing their own
    APMs. HHS has been slow to take up new APM concepts, and thus: what can
    we do to incentivize the establishment of new APMs? Has the PTAC
    offered a viable way to propose and test new APMs? If not, what actions
    could be taken to encourage the adoption of PTAC models?

        Answer. First, the AMA strongly supports the Medicare Care
    Coordination Improvement Act of 2019 because it would increase care
    coordination for patients, improve health outcomes, and reduce spending
    by allowing physicians to participate and succeed in APMs. The vision
    of greater APM adoption can only be achieved if antiquated laws like
    Stark, which are based on outdated treatment delivery schemes, are
    modernized; the Act would help advance this vision.

        Tying compensation to the value of care provided, equipping
    providers with tools to improve care especially when that involves
    development of lower cost imaging centers or labs that are imbedded in
    the APM structure, and investing in software and care coordination
    tools to clinically and financially integrate, may run afoul of the
    Stark law. Specifically, in certain circumstances, it prohibits
    physicians from providing innovative services such as transportation or
    other services of value to their patients. Instead, the patient, in
    addition to dealing with the physical and emotional aspects of a
    disease or condition, must also attempt to coordinate their own care in
    a fragmented and siloed system. Accordingly, the AMA has urged Congress
    to create a Stark exception and anti-kickback safe harbor to facilitate
    coordinated care and promote well-designed APMs. This exception should
    be broad, covering both the development and operation of a model to
    allow physicians to transition to an APM model, and provide adequate
    protection for the entire care delivery process to include downstream
    care partners, entities, and manufacturers who are linking outcomes and
    value to the services or products provided.

        Second, AMA has also strongly supported the PTAC since its creation
    in MACRA. The PTAC was designed to allow physicians to develop and
    implement new payment models that would support the services physicians
    feel are necessary and provide accountability focused on aspects of
    quality and cost that physicians can control.

        There continue to be a limited number of APMs in which physicians
    can participate during the first 3 MACRA performance years. However,
    the AMA has recently been greatly encouraged by steps taken by the
    Center for Medicare and Medicaid Innovation (CMMI) that illustrate it
    is working to implement and further develop new models based on PTAC
    proposals.

        In order to ensure that physicians continue to be incentivized to
    develop APMs, we urge Congress to extend the APM bonus for an
    additional 6 years, which would allow physicians more of a realistic
    onramp to develop and move into new payment models. Given the limited
    number of APMs tested and approved to date, physicians need an
    extension of the APM bonus to allow them to experiment with new models
    and change the way they deliver care.

        We also recommend that Congress make technical corrections to MACRA
    that would give the PTAC explicit authority to provide data analyses
    and technical assistance to stakeholders developing physician-focused
    APM proposals. A provision of the Bipartisan Budget Act of 2018 allows
    PTAC to provide initial feedback to proposal submitters, but PTAC has
    been barred from providing the types of data analyses and technical
    assistance that could help stakeholders develop proposals that CMMI
    would be more readily able to implement.

        We appreciate Congress's continued efforts to work with CMS and the
    physician community to ensure there are sufficient numbers of APMs for
    physicians to choose from.

        Question. Per data from CMS, about half of all Medicare providers
    are participating in MIPS, with the majority of these non-participating
    providers being exempt via the low-volume threshold. While we don't
    want to place additional burdens on small and rural providers, we
    should be identifying ways to engage with these practices to help them
    transition towards value-based outcomes.

        What actions should be taken to engage with these providers?

        Answer. The AMA continues to believe the simplest way to ensure
    small and rural practices remain viable is to maintain the low-volume
    threshold. To eliminate or reduce the threshold, and force physicians
    to participate in MIPS, when they see such few Medicare patients, could
    cause small and rural practices to close.

        If Congress's goal is to help these small practices transition into
    value-based outcomes, it should focus on ensuring the development and
    implementation of APMs are realistic for small practices to implement.
    This may require multiple small pilot models to determine what will
    best meet the goals of patients and CMS. In addition, the extension of
    the APM bonus payments, as mentioned above would provide a more
    realistic onramp for small practices to start implementing APMs.

        Finally, Congress should revisit the APM Qualifying Participant
    (QP) payment thresholds set by MACRA. It is unrealistic for many small
    practices to escalate from 25 to 75 percent of APM participant revenues
    over a 5-year period. These thresholds are especially difficult to
    achieve for practices that implement episode-based APMs. Therefore, the
    AMA has recommended that CMS' statutory authority be expanded so it can
    set both the payment and patient thresholds for QP status and set
    different thresholds for different types of APMs.

        In addition, the costs of compliance with MIPS reporting criteria
    need to be addressed. As I mentioned in my testimony, my practice
    scored 100 percent on MIPS but the increase in payments was $104,000
    less than the cost of achieving that score.

                                     ______

                     Questions Submitted by Hon. Ron Wyden
        Question. The Independence at Home demonstration, which was
    expanded and extended last year through the CHRONIC Care Act, enables
    care teams to deliver high-quality primary care to Medicare
    beneficiaries in the comfort of their own homes. In its third
    performance year, according to the Centers for Medicare and Medicaid
    Services (CMS), Independence at Home saved $16.3 million for the
    Medicare program.\1\ A recent evaluation also found that Independence
    at Home has resulted in fewer emergency department visits leading to
    hospitalization, a lower proportion of beneficiaries with at least one
    unplanned hospital readmission during the year, and a reduced number of
    preventable hospital admissions.\2\
    ---------------------------------------------------------------------------
        \1\ https://innovation.cms.gov/Files/fact-sheet/iah-yr3-fs.pdf.
        \2\ https://innovation.cms.gov/Files/reports/iah-rtc.pdf.

        As I mentioned at the hearing, I am committed to building on the
    success of the Independence at Home demonstration. As discussed at the
    hearing, I understand that the new Primary Care First model recently
    announced by CMMI (the Center for Medicare and Medicaid Innovation at
    CMS) may provide an avenue to expand access to home-based primary care
    ---------------------------------------------------------------------------
    for more Medicare beneficiaries.

        Based on your members' experience in Independence at Home and other
    Alternative Payment Models, what key components will be necessary in
    order for the Primary Care First model to expand access to home-based
    primary care?

        Answer. The AMA is happy to work with you and your colleagues to
    expand access to home-based primary care. The AMA continues to support
    the Independence at Home (IAH) Demonstration Program, which has already
    produced savings to the Medicare program as well as improved health
    outcomes among a beneficiary population that is medically fragile with
    high acuity. The comprehensive approach and flexibilities provided by
    the IAH Demonstration have established a proven method for providing
    care in less costly settings that enhance the quality of patient care.
    Notably, IAH teams that include a physician and have an established
    relationship with a hospital are able to provide the most
    comprehensive, coordinated care, particularly for patients with complex
    comorbidities.

        Question. What other specific policies would you recommend Congress
    or CMS consider to expand access to home-based primary care for more
    Medicare beneficiaries?

        Answer. In order to improve home-based primary care and access to
    timely medical treatment for Medicare's most vulnerable and high acuity
    beneficiaries, the AMA strongly urges Congress to provide access to
    medically necessary and timely clinical services by lifting statutory
    restrictions on telehealth. The AMA recommends that Congress amend
    section 1834(m) of the Social Security Act to waive the geographic and
    originating site limitations for such services for home-based primary
    care. Currently, most Medicare beneficiaries are not eligible to
    receive telehealth services. A limited subset of Medicare beneficiaries
    are eligible for telehealth services that CMS has determined are
    clinically appropriate to be delivered via telehealth. The beneficiary
    must reside in a qualifying rural geographic location. Furthermore,
    even those who reside in a qualifying geographic location in most
    instances are precluded from receiving such services in their home.
    Counter-
    intuitively, a Medicare beneficiary must travel to a qualifying
    facility such as their physician's office or the hospital in order to
    receive telehealth services.

        Section 1834(m) was fashioned at a time when telehealth was
    primarily used to provide access to medical specialty services in rural
    underserved communities and the technology to enable reliable, high
    quality two-way audio-visual real time communications was limited to
    health facilities. The dramatic advances in digital technology and
    rapid dispersion of such technologies obviate the concerns that
    initially prompted Congress to prescribe the section 1834(m)
    limitations. The restrictions have chilled the uptake and use of
    telehealth services as part of continuum of services a medical practice
    may offer to high acuity and medically complex beneficiaries,
    particularly those who receive home-based primary care. The limited
    Medicare coverage is in sharp contrast to commercial insurers and other
    Federal health-care programs like the Veterans Health Administration
    and Department of Defense that have moved forward to expand coverage of
    telehealth services. These Federal health-care programs moved forward
    to expand coverage because the evidence base has grown demonstrating
    both clinical efficacy for various telehealth services as well as
    overall reduction in costs through improved triage, reduction in
    emergency department visits, and reductions in hospitalization along
    with improved care coordination and communication.

        Coordination of care between primary and specialty care is an
    essential part of keeping complex Medicare patients out of the
    hospital. Removing the restriction on telemedicine for both primary and
    specialty care would facilitate multidisciplinary care and extend the
    effective reach of the primary care physician.

        For the past several years, the AMA has urged CMS to undertake
    telehealth demonstrations that waive these restrictions to evaluate
    whether expansion is warranted under CMMI authority. We have
    recommended a request for proposal(s) for demonstrations to evaluate
    the telehealth services Medicare currently covers (albeit with
    restrictions) by waiving those statutory geographic and/or originating
    site restrictions. Also, the demonstrations should be sufficiently
    large (e.g., several regions or multiple States) to provide sufficient
    claims data to evaluate whether telehealth is cost saving or cost
    neutral without the restrictions. At a minimum, we urge Congress to
    require CMS to undertake a demonstration to waive the originating site
    restrictions for Medicare beneficiaries who live in an eligible
    geographic location to assess cost savings or neutrality of delivering
    such services while beneficiaries are at home. This will provide
    increased access for beneficiaries in qualifying rural locations. CMS
    would not only be able to expand coverage where such services are cost
    neutral or cost saving while maintaining or improving clinical care,
    but this would also generate essential claims data needed by Congress
    and the Congressional Budget Office to develop more accurate cost
    estimates based on the Medicare patient population that will be
    informative for other services.

        We strongly urge Congress, however, to lift the geographic and
    originating site restrictions for Medicare beneficiaries receiving
    home-based primary care when received as part of a continuum of
    services (both in-person and virtual) in a coordinated manner with an
    established medical home. This patient population is the most likely to
    benefit from enhanced access to care. Telehealth provides the care team
    and caregivers additional options to ensure that these medically
    complex patients have access to the right care, at the right time.

        In addition to IAH and other primary care models, we also need to
    better support specialists who work with primary care physicians to
    manage patients with chronic conditions. For example, the American
    College of Physicians developed a ``medical neighborhood'' model to
    help support the teams of primary care physicians and specialists who
    are often needed to manage patients with chronic diseases. A model was
    also submitted to the PTAC recently that would support teams of primary
    care physicians and pulmonary or allergy specialists in managing
    patients with asthma.

        Question. As I mentioned during the hearing, I often hear from
    seniors in Oregon that they don't feel like anyone is in charge of
    managing their health care and helping them navigate the health-care
    system. I am proud of the bipartisan work that this committee did on
    the CHRONIC Care Act last Congress to update the Medicare guarantee. In
    my view, the next step should be making sure that all Medicare
    beneficiaries with chronic illnesses have someone running point on
    their health care--in other words, a chronic care point guard--
    regardless of whether they get their care through Medicare Advantage
    (MA), an accountable care organization (ACO) or other alternative
    payment model, or traditional fee-for-service Medicare.

        For beneficiaries in traditional, fee-for-service Medicare, what
    can be done to improve care coordination and make sure their physicians
    and other health-care professionals are all talking to each other and
    working together to provide the best possible care to those
    beneficiaries? What specific policies would you recommend this
    committee pursue toward that end?

        Answer. The health-care system is moving to a world that pays
    health professionals to manage episodes of patient care in a more
    comprehensive way. However, this approach to payment can run afoul of
    the fraud and abuse laws. For example, even if the primary purpose of
    an arrangement is to improve patients' health outcomes, as long as one
    purpose of the arrangement's payments is to induce future referrals,
    the fraud and abuse laws are implicated (e.g., an arrangement that pays
    for a nurse coordinator to coordinate a recently discharged patient's
    care among a hospital, physician specialists, and a primary care
    physician may induce future referrals to the primary care physician to
    avoid an unnecessary readmission to the hospital).

        Fostering the shift to APMs has necessitated reviewing and, in some
    situations, updating fraud and abuse laws to ensure that they do not
    unduly impede the development of value-based payment. Through specific
    statutory authority, both the CMS and the Office of Inspector General
    (OIG) have deemed it necessary to waive the requirements of certain
    fraud and abuse laws to test the viability of innovative models that
    reward value and outcomes.

        Outside of those models, however, the fraud and abuse laws may
    still pose barriers to initiatives that align payment with quality and
    improve care coordination. Tying compensation to the value of care
    provided, equipping providers with tools to improve care, and investing
    in tools to clinically and financially integrate all may run afoul of
    these laws. For example, the Stark law impedes sharing needed resources
    between multiple physicians caring for the patient which prohibits
    physicians from coordinating care on behalf of their patients. Instead,
    the patient, in addition to dealing with the physical and emotional
    aspects of a disease or condition, must also attempt to coordinate
    their own care in a fragmented and siloed system. Placing the
    obligation on the patient to know how to properly manage follow-up care
    without the assistance of their physician or care coordinator may have
    a negative impact on patient care and the physician-patient
    relationship.

        Accordingly, the AMA has urged Congress and the administration to
    create a Stark exception and anti-kickback safe harbor to facilitate
    coordinated care and promote well-designed APMs. This exception should
    be broad, covering both the development and operation of a model to
    allow physicians to transition to an APM model, and provide adequate
    protection for the entire care delivery process to include downstream
    care partners, entities, and manufacturers who are linking outcomes and
    value to the services or products provided.

        Successfully navigating health care will also require consistent
    access to the right information at the right time about the right
    individual. This is an overarching need by both patients and
    physicians. Often the term interoperability is used which makes this
    seem a purely technical issue. In actuality, physicians want
    information that is pertinent to their clinical needs and that they can
    trust is accurate. Patients want to ensure that their physicians have
    access to their medical records and have assurances that their medical
    information is safe, private, and secure.

        The AMA supports several proposals by HHS to address technical
    aspects of EHR interoperability issues. Yet, both patients and
    physicians are concerned that the recent information blocking proposals
    will not improve the access, use, and exchange of information. Rather,
    as proposed, HHS's rules may ultimately compromise patient privacy,
    increase the likelihood of cyber-attacks in health care, overwhelm
    patients with information that may not be useful, and undermine
    physician clinical decision-making. The AMA urges Congress to take a
    close look at the unintended consequences of HHS's information blocking
    and interoperability proposals and recommends Congress use its
    oversight role to ensure the goal of care coordination is achieved
    without sacrificing patients' rights in the process.

        Furthermore, to improve utilization of chronic care management
    (CCM), transitional care management (TCM), and other care management
    services by Medicare patients, the AMA recommends that Congress
    eliminate the cost-sharing requirements for these services. Although
    utilization of CCM and TCM has been increasing in recent years, patient
    cost-sharing remains a barrier. Trying to promote patient participation
    in a care management program, and then having to talk about patients'
    cost-sharing obligations, puts physicians in an uncomfortable position.
    As a result, patients are reluctant to consent to participate in care
    management programs, and if they do, they frequently complain about the
    cost. These concerns often lead to them withdrawing from the program.
    By removing the cost-sharing obligations from the care management
    codes, more Medicare beneficiaries will benefit from the care
    coordination and case management services these codes support.

        Question. Please describe the specific steps that Congress and/or
    CMS could take to ensure all Medicare beneficiaries with chronic
    illnesses, including those in traditional fee-for-service Medicare,
    have a chronic care point guard.

        Answer. Congress or the administration can take the following steps
    to ensure a chronic care point guard:

            1.  Update the fraud and abuse laws so that a chronic care
            point guard is not considered remuneration.

            2.  Make meeting the requirements of the promoting access to
            care exception under the Civil Monetary Penalties (CMP) be a
            permissible activity that would not be subject to the anti-
            kickback statute liability.

            3.  Allow for the waiver of cost-sharing amounts for chronic
            care management services and when the amount to collect the
            cost-sharing amount is less than reasonable collection efforts.

        With Medicare beneficiaries with chronic illnesses, the AMA has
    concerns about the ability of financial arrangements to satisfy anti-
    kickback safe harbors that involve shared savings or incentive payments
    being distributed based on the value of care provided by physicians
    either in a group or independent practice. For example, a financial
    arrangement that is based on managing patients with a chronic disease
    rewards an individual physician for properly coordinating care with a
    chronic care point guard or nursing staff and intervening proactively
    with a patient to prevent unnecessary hospitalization. This reward can
    be interpreted as running afoul of the anti-kickback statute as
    remuneration in return for referring an individual for an item or
    service that is payable under a Federal health-care program (i.e.,
    referral for a follow-up primary care visit in lieu of an unnecessary
    hospitalization).

        The AMA is also concerned about potential anti-kickback statute
    liability for arrangements and activities that fall within the
    exceptions from the definition of remuneration under the CMP law.
    Specifically, the exception from the beneficiary inducement CMP for
    remuneration that promotes access to care and poses a low risk of harm
    could implicate anti-kickback statute liability. This means that
    although a physician meets the requirements of an exception under the
    CMP law, the physician is still liable under the anti-kickback statute.
    For example, beneficiaries being provided a dedicated mobile treatment
    plan app that allows for daily engagement with the physician and
    ensures greater compliance with agreed to evidence-based treatment
    plans so that early intervention can be taken to avoid unnecessary
    hospitalizations and emergency room visits fits within the exception
    from remuneration because it helps beneficiaries access care by
    improved future care-planning by their physician. However, the
    arrangement is still subject to anti-kickback statute liability.

        The promoting access to care exception from remuneration already
    includes the concept of posing a low risk of harm to patients and the
    Federal health-care programs, OIG has already placed the burden of
    demonstrating low risk of harm under the CMP onto health-care
    providers,\3\ and using the Advisory Opinion process for a case-by-case
    determination for every instance of a beneficiary incentive is an
    impracticable solution. Moreover, these incentives help deliver higher
    quality, better coordinated care; enhance value; and improve the
    overall health of patients and should not be subject to the anti-
    kickback statute when posing a low risk of harm to patients. Thus,
    Congress should consider legislation that meeting the requirements of
    the promoting access to care exception from remuneration would be a
    permissible activity that would not be subject to the anti-kickback
    statute.
    ---------------------------------------------------------------------------
        \3\ See 81 Fed. Reg. 88368, 88391 (December 7, 2016).

        Cost-sharing obligations are particularly problematic with chronic
    care management (CCM) services. Patients may be discouraged from taking
    advantage of this high-value service due to the cost-sharing amounts.
    Congress should create a safe harbor to waive cost-sharing amounts for
    CCM and other high-value services that may save money through better
    care coordination, improved patient outcomes, and avoiding unnecessary
    hospitalizations. This safe harbor could be tied to APMs that are
    focused on managing chronic conditions where the cost-sharing amount
    may discourage a patient from seeking primary care. Removing this
    unnecessary impediment to the physician-patient relationship could
    return impressive results. Regular appointments allow providers to more
    closely monitor patients and identify complications before they require
    hospitalization and to establish a more regular, wellness-based
    relationship between physician and patient. This can encourage the
    patient to reach out to a physician before resorting to more costly
    ---------------------------------------------------------------------------
    options such as calling an ambulance.

        Additionally, cost-sharing obligations are also problematic when
    the costs associated with reasonable collection efforts exceeds the
    cost-sharing amount that would be potentially collected. Thus, Congress
    should clarify that an exception exists from the definition of
    remuneration under the CMP to allow for the waiver of cost-
    sharing amounts when the cost-sharing amount is nominal. For example,
    CMS expanded Medicare coverage to include services like virtual care
    visits. CMS pays approximately $15 for a virtual check-in service.\4\
    With a 20-percent cost-sharing amount, a beneficiary would pay
    approximately $3. As defined by CMS and OIG, the costs of any
    ``reasonable collection effort'' would far exceed the $3 collected.\5\
    Requiring such efforts creates waste, adds unnecessary administrative
    burdens, and inappropriately increases costs to physician practices.
    Thus, Congress should clarify that the ``reasonable collection
    efforts'' under section 1128A(i)(6)(A)(iii)(II) of the Social Security
    Act do not include situations where the costs of the collection efforts
    by the provider exceeds the cost-sharing amount that would be
    potentially collected.
    ---------------------------------------------------------------------------
        \4\ 83 Fed. Reg. 35704, 35723, and 35786 (July 27, 2018).
        \5\ OIG has stated that ``reasonable collection efforts'' are those
    efforts that a reasonable provider would undertake to collect amounts
    owed for items and services provided to patients. 65 Fed. Reg. 24400,
    24404 (April 26, 2000). In 2016, OIG cited the CMS Provider
    Reimbursement Manual's description of reasonable collection efforts
    including requiring ``providers to issue a bill for the patient's
    financial obligation'' and ``other actions such as subsequent billings,
    collection letters, and telephone calls or personal contacts with this
    party which constitute a genuine, rather than a token, collection
    effort.'' 81 Fed. Reg. 88368, 88374 (December 7, 2016) (citing CMS,
    Provider Reimbursement Manual, CMS Pub. 15-1, Sec. 310).

        In addition, Congress and CMS have several opportunities to refine
    the Medicare Access and CHIP Reauthorization Act (MACRA) to promote
    care coordination for Medicare beneficiaries. In a recent letter to
    congressional leaders, the AMA and 120 national specialty and State
    ---------------------------------------------------------------------------
    medical societies outlined several refinements, including:

              Replace the upcoming Medicare physician pay freeze with a
            stable and sustainable revenue source that allows physicians to
            sustain their practice and provides a margin to invest in the
            practice improvements needed to transition to more efficient
            models of care delivery and better serve Medicare patients;
              Extend the Advanced APM payments for an additional 6 years
            to provide physicians with an onramp to move to APMs once they
            become available, as intended in the original legislation; and
              Simplify the MIPS by allowing physicians to focus their
            participation around a specific episode of care, condition, or
            public health priority to address the needs of their patient
            population.

        Question. Eligible clinicians who receive a certain percentage of
    their payments or see a certain percentage of their patients through
    Advanced APMs are excluded from MIPS and qualify for the 5-percent
    incentive payment for payment years 2019 through 2024. Starting this
    year (performance year 2019), eligible clinicians may also become
    qualifying APM participants (and thus qualify for incentive payments in
    2021) based in part on participation in Other Payer Advanced APMs
    developed by non-Medicare payers, such as private insurers, including
    Medicare Advantage plans, or State Medicaid programs.

        Recognizing that this is the first year in which the All-Payer
    Combination Option is available, how many of your members do you
    anticipate will take advantage of the All-Payer Combination Option this
    year?

        Answer. As currently implemented, the All-Payer Combination Option
    hurts more than helps physicians in achieving Qualifying Participant
    (QP) status. Under this option, participation in APMs is measured as a
    percent of nearly all payers, including Medicaid, Medicare Advantage,
    commercial payers, and others, rather than as a percent of payers with
    value-based care programs that meet CMS's definition of an Advanced
    APM. We urge Congress to change this so that participating in Other
    Payer APMs adds to Medicare Part B APM participation and helps
    physicians reach the QP thresholds.

        Question. What, if any, challenges have your members faced when
    attempting to take advantage of the All-Payer Combination Option?

        Answer. Many payers do not offer value-based care programs that
    meet CMS's definition of an Advanced APM. Because of this constraint,
    many physicians who are participating in such programs with payers, in
    addition to Medicare Part B Advanced APMs, are not permitted credit
    under CMS's rules for such participation. This is contrary to the goal
    of Congress to encourage physician participation in value-based models
    across multiple payers. We believe Congress should modify the All-Payer
    Combination Option so that participating in Other Payer APMs adds to
    Medicare Part B APM participation and helps physicians reach the QP
    thresholds.

        Question. In the Medicare Access and CHIP Reauthorization Act of
    2015 (MACRA), Congress provided a total of $100 million over 5 years
    for technical assistance to MIPS-eligible clinicians in practices with
    15 or fewer clinicians, focusing on rural and health professional
    shortage areas.

        To what extent have your members utilized the services of the
    Small, Underserved, and Rural Support Initiative, which CMS launched
    using the MACRA funding to provide free, customized technical
    assistance to clinicians in small practices?

        Answer. The AMA strongly supports the free technical assistance
    available for clinicians in small practices and has heard that the
    assistance has been helpful, but more must be done to continue to
    support small and rural practices. In 2017, the national mean and
    median scores for all MIPS eligible clinicians were 74.01 and 88.97
    points. However, the mean and median scores for small practices were
    43.46 and 37.67. The lower scores achieved by small practices
    illustrate the need for Congress to work with the CMS and the physician
    community to continue to support and make changes that will help small
    practices and solo practitioners succeed in the program. Costs for
    reporting must be kept low, so that the value of a high score is more
    than the cost to achieve it.

        Question. What types of technical assistance and support have been
    most helpful to physicians and practices (e.g., understanding program
    requirements, selecting appropriate measures, forming virtual groups)?

        Answer. While continued technical assistance for small practices is
    important, the simplest way to ensure small and rural practices remain
    viable is to maintain the low volume threshold. To eliminate or reduce
    the threshold and force physicians to participate in MIPS would kill
    small practices. Financially, it just doesn't make sense for these
    practices with limited resources to invest in MACRA compliance when
    they have such a small Medicare patient population--less than four
    Medicare patients a week.

        In addition, for those small practices that treat larger Medicare
    patient populations and participate in the MIPS program, the most
    helpful assistance comes in shaping the MIPS program to allow practices
    of all sizes to be successful. For example, the reduced reporting
    requirements for small practices in several of the MIPS reporting
    categories, hardship exemptions from the Promoting Interoperability
    performance category for qualifying small practices, or bonus points
    for small practices greatly help small practices succeed in MIPS.

        EHR vendors often do not have data reporting tools that correspond
    to the MIPS requirements, which makes reporting very difficult and
    expensive. The measures need to be meaningful to the practices, which
    will differ depending on the practice type.

        Question. As physicians continue to gain experience with the
    Quality Payment Program, what additional types of technical assistance
    would be most helpful to solo practitioners and physicians in small
    practices and/or to those practicing medicine in rural or underserved
    areas?

        Answer. The AMA believes that Congress and CMS should continue to
    structure the Quality Payment Program so that physicians in practices
    of all sizes have the opportunity to succeed. Some ideas that the AMA
    has suggested to even the playing field between small and large
    practices include developing a separate performance threshold for small
    practices which would allow practices to be compared to other groups of
    a similar size with more analogous resources. The AMA has also provided
    detailed suggestions on how to improve virtual groups to make
    participation in a virtual group a viable option for small practices,
    including allowing groups to leverage Clinically Integrated Networks
    (CINs) and Independent Practice Associations (IPAs), providing
    protection from Stark and anti-kickback violations for virtual groups,
    and offering an additional incentive or bonus payment to practices
    participating in virtual groups until the model is tested and refined.

                                     ______

                   Question Submitted by Hon. Debbie Stabenow
        Question. I am very proud of the work the bipartisan
    accomplishments to address Alzheimer's, including the implementation of
    my HOPE for Alzheimer's Act, which required Medicare to pay for new
    individual care plans to support Alzheimer's patients and their
    families. Many of my colleagues are also cosponsors of my Improving
    HOPE for Alzheimer's Act, which will ensure beneficiaries and
    physicians know that they are able to access, and bill for, care
    planning under Medicare. In our last hearing on MACRA implementation,
    my colleagues raised the question of how we should look at quality
    measures in MIPS when it comes to physicians having these conversations
    with beneficiaries and their families and reflecting their priorities.
    Some have mentioned altering MIPS to make the quality measures more
    clinically meaningful. In what ways do you think the system would need
    to change to better incorporate long-term care planning and encourage
    physicians to have these conversations with patients?

        Answer. Under the current MIPS quality structure, CMS utilizes
    specialty measure sets and requires reporting on a minimum set number
    of measures (six), which forces physicians to pick random individual
    measures and lumps a specialty together, regardless of sub-
    specialization. In addition, when quality measures are tied to cost or
    an episode of care, it does not necessarily ensure that the quality
    measures match up with the episode and can appropriately evaluate
    potential for stinting on care to appear low cost. We believe allowing
    physicians to focus on activities that fit within their workflow and
    address their patient population needs--and providing them with credit
    for those activities that span across MIPS categories--will increase
    participation in MIPS, allow physicians to report on measures that are
    more meaningful to their practice, and drive continued improvement
    across performance categories.

                                     ______

                   Questions Submitted by Hon. Sherrod Brown
                        development of metrics in macra
        Question. In your testimony, you mentioned that your physician
    members believe that there is no link between many of the MIPS measures
    they are required to report and improving clinical care for their
    patients. I understand that the physician community has engaged with
    CMS to try and make the program more meaningful to physicians and
    patients through more relevant quality measures.

        How are clinicians from your organization involved the creation of
    these measures relevant to their specialties?

        Answer. The American Society of Clinical Oncology (ASCO), along
    with many other medical specialty societies have a measure development
    process in place which leverages the expertise of their members on
    expert panels. They also provide input on the feasibility of data
    collection and participate in measure testing. CMS also develops MIPS
    quality measures through its various contractors. While the contractors
    may include specialists to participate on the technical expert panels,
    the contractors are often not very receptive to specialty feedback and
    the AMA urges CMS to include more specialty input throughout the
    measure development process.
    MIPS cost measure development
        The AMA appreciated the flexibility in the Bipartisan Budget Act of
    2018 for CMS to gradually increase the weight of the cost category
    while the agency develops new episode-based measures. Over the past 2
    years, CMS has taken several important steps to improve its ability to
    fairly and accurately measure and compare physician resource use. The
    AMA greatly appreciates the agency's efforts to increase clinical input
    into the development of new measurement tools such as patient
    relationship categories and episode-based cost measures.

        The AMA has worked with national specialty, State and other
    physician groups to ensure this process involves as many physician
    perspectives as possible and to develop recommendations for
    improvements that have broad support across the profession. The AMA
    also works closely with a smaller set of specialty and State medical
    societies as part of its MIPS workgroup to provide CMS and its
    contractor with detailed suggestions to improve the cost measure
    development and refinement process.

        Finally, AMA members, including a current member of the AMA Board
    of Trustees, have devoted substantial hours volunteering on the cost
    measure technical expert panels to provide clinical input about how to
    accurately and fairly attribute episode of care costs to physicians. As
    discussed in detail below, however, CMS has retained problematic
    population level measures that have been developed outside of this
    process and with less clinical input, including the total per capita
    cost measure. Total cost of care is a very complex issue that cannot
    easily be attributed, and physicians are frustrated at being held
    accountable for issues beyond their control.

        Question. Has CMS been receptive to your feedback when provided?

        Answer. Many medical specialty societies are developing tools such
    as Qualified Clinical Data Registries (QCDRs), to help physicians
    incorporate systems of learning into their practice to improve quality
    of care, provider workflow, patient safety, and efficiency. For
    improvements to be made to quality measurement we must move beyond
    snapshots of care which focus on random individual measures to a
    learning system with a broad focus. Utilizing specialty-led QCDRs
    provides an opportunity to evaluate care within an entire specialty, as
    well as at the individual physician level. Unfortunately, CMS has not
    been very receptive to specialty developed measures, especially ones
    developed for use within a QCDR, which was the intent of the QCDR
    pathway in the MACRA statue. CMS' MIPS requirements and benchmark
    methodologies also discourage practices from reporting through a QCDR.
    Therefore, specialty societies have begun to stop supporting their
    QCDRs and developing quality measures due to the escalating burden and
    arbitrary nature of the vetting process and MIPS requirements that
    often lacks evidence and operates on unrealistic timelines and
    expectations. We believe the key to achieving MACRA's goals is the
    availability of an adequate portfolio of appropriate quality measures
    that allows for all physicians, regardless of specialty or subspecialty
    to meaningfully participate in the program.
    Streamlining MIPS
        Further refinements are also needed to make MIPS clinically
    relevant for physicians and patients. The AMA urges Congress and CMS to
    continue to make MIPS more meaningful for physicians. We hear from our
    physician members that there is no link between many of the MIPS
    measures they are required to report and improving clinical care for
    their patients. The AMA has engaged the physician community through
    workgroups to develop creative solutions to simplify and streamline the
    QPP, while making it more meaningful for physicians.

        In a recent letter to congressional leaders, the AMA and 120
    national specialty and State medical societies outlined several
    refinements to the Medicare Access and CHIP Reauthorization Act
    including recommendations to simplify MIPS and make reporting more
    clinically meaningful for physicians. For example, Congress and CMS
    could make the program more cohesive by allowing physicians to focus
    their participation around a specific episode of care, condition, or
    public health priority. By allowing physicians to focus on activities
    that fit within their workflow and address their patient population's
    needs, rather than segregated measures divided into four disparate MIPS
    categories, the program would be more likely to improve quality of care
    for patients, reduce Medicare spending, and be more meaningful and less
    burdensome for physicians.

        CMS should also have explicit flexibility to base scoring on multi-
    category measures to make MIPS more clinically meaningful, reduce silos
    between each of the four MIPS categories, and create a more unified
    program. This provision could also allow CMS to award bonus points at
    the composite score level, which would allow for a simplified scoring
    methodology. The primary goal of this approach is to allow physicians
    to spend less time on reporting and more time with patients and on
    improving care, and to create a more sustainable MIPS program. It also
    creates a glide path towards participation in APMs by encouraging
    physicians to focus on more clinically relevant measures and
    activities, improvement, and providing better value care to patients.
    We look forward to working with Congress and CMS to implement some of
    these creative solutions and continue to improve MIPS.

        Question. How would you assess CMS's collaboration on achieving
    meaningful metrics?

        Answer. The AMA was instrumental in ensuring MACRA included funding
    authorization for quality measure development, and we appreciate CMS's
    efforts to streamline measures and eliminate duplication. However, we
    have concerns with the way CMS allocated the funding for measure
    development. We were hopeful that CMS would have funded small projects
    over multiple years to several physician-led organizations to allow for
    maximum participation. Instead CMS issued a single announcement in 2018
    (3 years after the passage of MACRA), funding only seven projects. We
    were also disappointed that some of the awards were given to large
    provider systems, rather than physician-led organizations, and that
    much of the work involved re-specifying and/or re-tooling existing
    measures, which is traditionally work handled by CMS's Measure and
    Instrument Development and Support contractors. There also does not
    appear to be a requirement in the cooperative agreements to require
    contractors to seek feedback and coordinate with specialty societies
    and practicing physicians.

        We believe the MACRA statute intended ``organizations with quality
    measure development expertise'' to be physician-led organizations,
    specifically medical specialty societies and PCPI that have devoted
    substantial time and resources to developing and refining quality
    improvement and/or measure development activities. Partnering with
    specialty societies and PCPI would have ensured the measures aligned
    with specialty guideline development, quality improvement efforts, QCDR
    activities and alternative payment models.

        We appreciate CMS's efforts to streamline regulations with the goal
    to reduce unnecessary cost and burden on physicians, as well as the
    initial efforts to identify the highest priority areas for quality
    measurement and improvement to improve patient outcomes through the
    Meaningful Measures Initiative. We also recognize the need to move to
    more measures focused on outcomes; however, absent true reforms to the
    quality category, benchmark methodology and overall MIPS program we do
    not believe the Meaningful Measure Initiative is truly a reduction of
    administrative burden. At a minimum, if CMS would like to see immediate
    reduction and return on Patients Over Paperwork, we strongly urge CMS
    to reduce the number of quality measures a physician must report and
    adopt our recommendations to simplify MIPS and make the program more
    meaningful.

        MACRA requires all physicians to participate, regardless of
    specialty so there must be a sufficient number of meaningful measures
    that all physicians can report to satisfy the quality category. Under
    the current MIPS quality structure, CMS utilizes specialty measure sets
    and requires reporting on a minimum set number of measures (six), which
    still forces physicians to pick random individual measures and lumps a
    specialty together, regardless of sub-specialization. When you tie this
    to cost/an episode it does not ensure that the specialty set matches up
    with the episode and would seem to encourage physicians to stint on
    care to appear low cost. No measure should ever penalize a physician
    for doing the right thing for patients or suggest that avoiding needed
    care is a good idea.

        We believe allowing physicians to focus on activities that fit
    within their workflow and address their patient population needs--and
    providing them with credit for those activities that span across MIPS
    categories--will encourage increased participation and drive continued
    improvement across categories.

        Question. Are there any changes in this process you would
    recommend?
    MIPS quality category
        We request that CMS ensure that current and future projects are
    coordinated with specialty societies and that practicing physicians are
    actively involved during the development, specification and testing of
    the measures, which follows the intent of the law. We also request that
    CMS require that the relevant specialty societies have a seat at the
    table during the measure development process, including at the time of
    concept. This involvement is critical across the majority of funded
    projects, as it is not clear the degree to which these academic
    institutions and others can leverage clinical expertise available to
    specialty societies.

        To improve the QCDR process, CMS must recognize that changes to
    QCDRs, registries or EHRs require significant financial resources and
    time to plan, incorporate, and test. This time-lag limitation becomes
    very challenging when CMS makes annual changes to quality requirements,
    measure specifications or technology functionality. Absent a reduction
    in the number of measures a physician must satisfactorily report, the
    AMA does not support immediate removal of measures from the program,
    but would support a phased approach. Without such a process, it is
    extremely hard for specialty QCDR stewards to plan and fails to
    consider the length of time it takes to develop a measure. It is also
    extremely difficult for physicians to create historic benchmarks if CMS
    changes or removes measures on an annual basis. It is the AMA's belief
    that the only way to truly measure improvement and track data over time
    is to have a process in place that allows for longitudinal data
    collection and tracking.
    MIPS cost category
        To improve the cost category of MIPS, CMS should focus on
    developing episode-based cost measures with high variability and
    potential high impact for change at the physician level and Congress
    should remove the requirement that episode-based cost measures account
    for half of all expenditures under Parts A and B in MACRA.

        In addition, we recommend removing the total cost of care measure
    requirement. The original Total Per Capita Cost (TPCC) measure did not
    receive endorsement by the National Quality Forum in 2013 for use in
    physician cost measurement. Problems with the measure were linked to
    validity, patient attribution, and holding physicians accountable for
    costs over which the physician has no control. Moreover, the measure
    holds physicians responsible for total Medicare Part A and B
    expenditures, including costs over which the physician has no control.
    In recognition of the issues with the existing TPCC measure, CMS
    recently pursued revisions to the measure's attribution methodology and
    measurement period, among other changes.

        At a time when cost measurement is an immature science, the AMA
    appreciates CMS's willingness to revisit and refine existing cost
    measures. We believe, however, that the revisions to the TPCC measure
    do not address underlying concerns about the measure's validity and
    raise new problems with the attribution methodology. The revised TPCC
    measure retains the flawed concept of holding physicians responsible
    for total costs of care even for services delivered after the patient
    was no longer in their care and assumes that data regarding services
    provided by other physicians is readily available and therefore
    actionable by the attributed physician. The revisions to the measure
    also increased the risk of inappropriate attributions. For example,
    while certain specialists who provide specific types of services (e.g.,
    chemotherapy, radiation therapy, surgery, and anesthesia) would be
    exempt, a practice comprised of exempt specialists might still be
    subject to the measure if a physician assistant or nurse practitioner
    provides an office visit and has the beneficiary attributed to them as
    a result. We believe CMS should score physicians on episode-based cost
    measures that have a stronger correlation with costs that are within
    physicians' control and remove the TPCC measure from MIPS.

        While we continue to believe that appropriately designed episode
    cost measures have the potential to measure costs more accurately,
    these measures represent a significant shift in the measurement of
    resource use. CMS should put in place safeguards against unintended
    consequences. These include:

              Phasing in new measures over several performance periods to
            give physicians an opportunity to understand how they will be
            evaluated on their resource utilization during episodes;
              Increasing the case minimums for measures to create better
            physician buy-in, promote more accurate benchmarks, and ensure
            individual physicians and small groups are not disadvantaged by
            a small number of outliers;
              Lowering or at least maintaining the current cost category
            weight at 15 percent for the next 3 years while new episode
            measures are developed, tested, and used in MIPS;
              Releasing more detailed analyses about how the new measures
            will impact physicians and groups, particularly based on group
            size; and
              Conducting extensive education and outreach about the new
            measures.

        Finally, the point of the MIPS cost category is to show physicians
    where there are opportunities for their practice to be more efficient.
    However, initial MIPS feedback reports did not include the detailed
    patient level information that was available in the predecessor Quality
    and Resource Use Reports (QRUR). Physicians tell us that the QRURs were
    much more useful and that the QRUR drop down data should be restored in
    the feedback reports. It is our understanding that CMS intends to add
    this data in the future and we hope that the next round of feedback
    reports will contain additional data.
                         macra and the addiction crisis
        Question. During the hearing, Senator Hassan asked some important
    questions around the MACRA incentive payments for those who improve
    tracking and reporting of quality measures related to opioid
    prescribing and treatment. You mentioned that recognizing team-based
    care in the treatment of substance use disorder would be useful in the
    MACRA program.

        Can you please elaborate on your comments during the hearing
    related to this issue? How can MACRA be improved to take into account
    team-based care more effectively and how would this improve treatment
    for substance use disorder?

        Answer. On the APM side, the AMA and the American Society of
    Addiction Medicine developed a framework for an APM focused on
    treatment of opioid use disorder that Congress included in the SUPPORT
    Act last year as the basis for a federally mandated demonstration
    project. The AMA and American Society of Addiction Medicine talked with
    physicians who wanted to deliver treatment for patients with opioid use
    disorder but could not do so because of the problems in the current
    payment system, and so we designed an APM that would correct those
    problems.

        The AMA believes that the current approach to address the opioid
    crisis through quality measurement has been too narrowly focused on
    preventing and/or reducing opioid use in the absence of addressing the
    larger clinical issue--ensuring adequate pain control while minimizing
    the risk of opioid addiction. Quality measurement must focus on how
    well patients' pain is controlled, whether functional improvement goals
    are met, and what therapies are being used to manage pain. We recommend
    that CMS develop measures that examine adequate pain control with
    appropriate therapies of which opioids may be an option. Until such
    time that these broadly applicable measures are available, we do not
    support continued inclusion of the narrowly focused measures CMS has
    proposed in its quality programs.

        The AMA has also recommended that CMS adopt measures in the
    Improvement Activities part of MIPS focused specifically on physician
    efforts to end the opioid epidemic, such as taking the training needed
    to be able to prescribe buprenorphine to treat opioid use disorder.
                                   stark law
        Question. The goal of the Stark Law is to protect Medicare
    beneficiaries from unnecessary utilization and fraud. However, there
    are concerns from stakeholders that Stark Law hinders care coordination
    and does not align with value-based care by posing barriers to
    participation of physician group practices in APMs.

        During the hearing, in response to one of Senator Wyden's
    questions, you mentioned that changes to Stark Law are necessary
    because it prevents small community physicians from working together to
    offer less expensive services to patients.

        Can you please elaborate on your comments during the hearing
    related to this issue?

        Answer. As it relates to small community practices, one issue with
    Stark is virtual groups. To encourage broader MIPS participation for
    solo practitioners and groups with 10 or fewer eligible clinicians, CMS
    created a virtual group option. Many solo practitioners and groups of
    10 or fewer MIPS eligible clinicians have limited resources and
    technical capabilities. Virtual groups will involve preparation of
    health information technology systems and training staff to be ready
    for implementation, sharing and aggregating data, and coordinating
    workflows. While these are necessary steps to ensure the success of
    virtual groups, these steps could raise concerns involving Stark.

        By pooling resources together to participate in MIPS, individual
    physicians may receive an ownership interest in the virtual group or
    other compensation arrangement from the virtual group (e.g.,
    disbursement of any incentive payments). Moreover, physicians may
    prefer to refer patients within their own virtual group to control
    unnecessary costs and provide higher quality care because each
    physicians' performance is tied to the same virtual group's MIPS score.
    Any of these referrals within the virtual group between physicians
    could violate Stark. This outcome is different from a normal ``group
    practice'' where some of these referrals are protected from Stark
    through exceptions.

        ``Virtual groups,'' by definition, are not ``group practices'' as
    that term is specifically defined under Stark because virtual groups do
    not constitute a ``single legal entity.'' Virtual groups consist of at
    least two legal entities. Thus, because virtual groups do not meet this
    definition, the Stark in-office ancillary services exception and the
    physician services exception do not apply. Furthermore, the anti-
    kickback safe harbor for investments in group practices also does not
    apply. Accordingly, physicians in a virtual group with a financial
    relationship with such a virtual group may not be eligible to make
    referrals for designated health services payable by Medicare to the
    virtual group.

        More broadly, significant changes in health-care payment and
    delivery have occurred since the enactment of Stark. Numerous
    initiatives are attempting to align payment and coordinate care to
    improve the quality and value of care delivered. The delivery of care
    is going through a digital transformation. However, Stark--in its
    almost 30 years of existence--has not commensurably changed.

        Stark was enacted in a fee-for-service world that paid for services
    on a piecemeal basis. The fraud and abuse laws act as a deterrent
    against overutilization, inappropriate patient steering, and
    compromised medical judgment with heavy civil and criminal penalties
    like treble damages, exclusion from participation in Federal health-
    care programs, and potential jail time.

        The health-care system is moving to a world that pays health
    professionals to manage episodes of patient care in a more
    comprehensive way. However, this approach to payment can run afoul of
    the fraud and abuse laws. For example, even if the primary purpose of
    an arrangement is to improve patients' health outcomes, as long as one
    purpose of the arrangement's payments is to induce future referrals,
    the fraud and abuse laws are implicated (e.g., an arrangement that pays
    for a nurse coordinator to coordinate a recently discharged patient's
    care among a hospital, physician specialists, and a primary care
    physician may induce future referrals to the primary care physician to
    avoid an unnecessary readmission to the hospital).

        Fostering the shift to APMs has necessitated reviewing and, in some
    situations, updating fraud and abuse laws to ensure that they do not
    unduly impede the development of value-based payment. Through specific
    statutory authority, both the CMS and the OIG have deemed it necessary
    to waive the requirements of certain fraud and abuse laws to test the
    viability of innovative models that reward value and outcomes.

        Outside of those models, however, the fraud and abuse laws may
    still pose barriers to initiatives that align payment with quality and
    improve care coordination. Tying compensation to the value of care
    provided, equipping providers with tools to improve care, and investing
    in tools to clinically and financially integrate all may run afoul of
    these laws. For example, the Stark law impedes care coordination by
    prohibiting physician groups from banding together to provide needed
    services. Specifically, in certain circumstances, it prohibits
    physicians from coordinating care on behalf of their patients. Instead,
    the patient, in addition to dealing with the physical and emotional
    aspects of a disease or condition, must also attempt to coordinate
    their own care in a fragmented and siloed system. Placing the
    obligation on the patient to know how to properly manage follow-up on
    care without the assistance of their physician or care coordinator may
    have a negative impact on patient care and the physician-patient
    relationship.

        Accordingly, the AMA has urged Congress and the administration to
    create a Stark exception to facilitate coordinated care and promote
    well-designed APMs. This exception should be broad, covering both the
    development and operation of a model to allow physicians to transition
    to an APM model, and provide adequate protection for the entire care
    delivery process to include downstream care partners, entities, and
    manufacturers who are linking outcomes and value to the services or
    products provided.

        Question. Congress and CMS have been considering modifying the
    Stark Law to promote more robust participation in APMs. If CMS waives
    Stark law for groups developing or operating APMs, what tools and
    guardrails would you recommend to ensure that the APMs developed by
    these groups reach 2-sided risk in a timely manner?

        Answer. Congress should create a Stark exception to facilitate
    coordinated care and promote well-designed APMs. The financial
    arrangement that fits within the exception should be for the purposes
    of operating and developing an APM. Protecting the development of the
    APM is a key to help shift physicians from transitioning from MIPS to
    APMs. The development should cover start-up and infrastructure costs.
    The exception should cover any arrangement between the APM, one or more
    of the APM's participants, downstream care partners, entities, and
    manufacturers who are linking outcomes and value to the services or
    products provided, or a combination thereof.

        Flexibility is important for innovation. Yet flexibility in a new
    payment system also may raise fraud and abuse concerns. To help address
    these concerns, the Stark exception could incorporate provisions that
    increased transparency and accountability through a board of director's
    approval; require the arrangement to be tied to the goals of the APM;
    and allow freedom of choice for patients by prohibiting stinting on
    medically necessary care. The exception should also ensure that
    referrals for designated health services are not being steered for
    market dominance or financial gain rather than for coordination of
    care.

        While participation agreements work well in the context of specific
    payments models, the AMA believes they would likely be impractical for
    Medicare generally. As an alternative, the parties to the arrangement
    could set forth in writing the arrangement, their goals for patient
    care quality, utilization, and costs, and the items and services
    covered under the arrangement.

                                     ______

                 Questions Submitted by Hon. Sheldon Whitehouse
        Question. Accountable Care Organizations (ACOs) have the potential
    to transform our health care delivery system. While we've seen ACOs
    improve patient care and create shared savings, many provider-led ACOs
    only control a small fraction of total spending, with specialists,
    pharmaceuticals, and hospitals accounting for most of it. This leads to
    ACOs lacking sufficient leverage to bring down costs and can contribute
    to shared losses.

        How can we improve the ACO model to account for this imbalance? How
    can we support successful ACOs and encourage more providers to follow
    their lead?

        Answer. Under the new ``Pathways to Success'' regulation, new ACOs
    will only have two to 3 years in a shared savings model before they
    have to take on downside risk. The AMA is concerned that this policy
    will prevent ACOs that may have been successful in improving quality of
    care for Medicare patients and in saving money for the Medicare program
    from continuing to participate.

        In addition, it is important to note that physicians who
    participate in ACOs are paid the same way as other physicians. They do
    not receive any upfront or monthly payments to support better care
    management services, team-based care, clinical decision support
    systems, or after-hours access. Without being provided any additional
    resources, they are asked to take financial risk for the total cost of
    care for thousands of patients. Changes that would help more ACOs
    successful include: develop better payment models for ACOs (and
    physicians who are part of ACOs) that provide them with the resources
    and flexibility needed to redesign patient care; limit downside risk to
    the types of costs that ACOs can actually influence or control, such as
    preventing avoidable hospital admissions, achieving good surgical
    outcomes with low complication rates, or managing chronic conditions so
    they do not get worse; extend the MACRA APM incentive payments for an
    additional 6 years; and give CMS authority to modify the thresholds for
    being a qualified APM participant.

        Question. Our health-care system is not fully equipped to care for
    an aging population and patients with advanced illness such as late-
    stage cancer, Alzheimer's disease or dementia, or congestive heart
    failure. This is an area where we need new models of care that reflect
    these challenges and create a better system for providers, patients,
    and their families. Many of our current Medicare rules in this space
    are counterproductive, such as requiring a 2-night, 3-day stay in an
    inpatient facility to qualify for skilled nursing care, and various
    disincentives to providing respite or palliative care. How are your
    organizations innovating to provide care for these patients, and what
    can Congress and CMS do to support those efforts?

        Answer. Congress and CMS should support APMs that focus on
    preventing hospitalizations and preventing exacerbations of these
    chronic conditions. Many of the PTAC proposals do this, as does the
    recently announced Primary Care First model. The PTAC proposal from the
    Renal Physicians Association is another good example. It focuses on the
    6-month period when patients transition from chronic to end-stage
    kidney disease, a very sick population. My PTAC proposal, MASON is an
    attempt to improve the Oncology Care Model so that more oncology
    practices will be able to continue the work of aggressively managing
    the side effects of cancer and its treatment to lower hospitalization
    rates, but with an accurate target price for the parts of oncology care
    that the physician can control.

        Congress can provide CMS with broader program waiver authority to
    support organizations that are innovating to provide care. Currently,
    CMS only has the authority to waive program waivers--like the skilled
    nursing facility 3-day rule--for the Medicare Shared Savings Program or
    for models operating under CMMI.

        We recognize that the most expensive part of the health care
    delivery system is the hospital inpatient arena, and encouraging
    chronic disease management to keep patients healthy enough to remain
    outpatients has great potential to save money as well as manage the
    increasing number of elderly with multiple chronic diseases. Yet the
    savings currently accrues to the insurer--Medicare in this case--but
    the expense accrues to the practices.

        Question. Despite continued investment, electronic health records
    (EHRs) remain difficult to share, challenging for patients to access,
    and a source of frustration to providers and policymakers alike. The
    business models of the EHR venders often leads to perverse incentives
    against sharing patient information.

        What steps can Congress take to make EHRs work better for
    providers?

        Answer. Four steps that Congress can take to make EHRs work better
    for providers:

            1.  Use of health information technology (health IT) beyond
            CEHRT for the Promoting Interoperability performance category;
            2.  Permit reporting by attestation to move to a more outcome-
            focused care;
            3.  Leverage EHR vendor-generated information to reduce
            physician burden and to meet the Federal Government's needs to
            collect data on EHR usage; and
            4.  Consider the capabilities of EHRs when developing quality
            measures.
                            use of hit beyond cehrt
        Question. Federal policy is a major driver in EHR system design.
    The AMA continues to highlight that Federal reporting requirements
    (e.g., the Quality Payment Program's Promoting Interoperability
    measures) are significant determinations in how EHRs look and feel to
    physicians. Simply put, EHR design is based on Federal reporting
    demands. Program requirements are too focused on physicians reporting
    use of EHRs as opposed to whether EHRs are useful to physicians and the
    care they provide to their patients. Unless changes are made, EHRs will
    continue to burden physicians.

        Answer. As an initial step to improve physicians' experience with
    health IT, physicians should be allowed to use certified EHR technology
    (CEHRT), technology that interacts with CEHRT, and/or a qualified
    clinical data registry to participate in Promoting Interoperability and
    to be considered a meaningful user. This will reduce the demand on EHRs
    having to be a ``one size fits all'' tool. Because increased
    interoperability and patient access will require new combinations of
    technologies and services, we continue to urge HHS to reevaluate
    regulations that prioritize the use of CEHRT over other non-certified
    digital health tools. Patients, physicians, and other care team members
    should be empowered to make decisions based on what works best for
    their needs, and not what regulatory boxes must be checked. Any new
    Promoting Interoperability measures should allow clinicians to utilize
    not only CEHRT but also health IT that ``builds on'' CEHRT--a concept
    taken directly from CMS's priorities in its call for new Promoting
    Interoperability measures. It would not only reward doctors who seek to
    utilize emerging health IT for patient care or contribute data for
    aggregation and quality analysis purposes, but also allow additional
    clinicians to participate in the Promoting Interoperability category
    since some currently seek an exclusion because they do not use CEHRT
    (e.g., non-patient facing clinicians such as radiologists). This would
    require a new clause in 1848(o)(2)(A):

            (iv) ADDITIONAL TECHNOLOGY--The eligible professional may
            choose whether to use certified EHR technology, technology that
            interacts with certified EHR technology, or may participate in
            a qualified clinical data registry (or a combination of all
            three technologies), to be considered a meaningful EHR user.
                            reporting by attestation
        Congress should direct CMS to utilize the authority it granted to
    the Secretary through HITECH to permit reporting in PI through yes/no
    attestation. Each ``yes'' would be worth a certain amount of points. In
    addition to relieving the reporting burden, an attestation-based
    approach would help facilitate EHR development to be more responsive to
    real-world patient and physician needs, rather than designed simply to
    measure, track, and report, and could help prioritize both existing and
    future gaps in health IT functionality. This can be accomplished by
    adding the following to 1848(q)(2)(B)(iv): ``For the performance
    category described in (A)(iv), the requirements shall be met via
    attestation or other less burdensome means.''
      leverage ehr vendor-generated information to reduce physician burden
        Congress should work with ONC and CMS to leverage EHR data
    generated as a byproduct of PI participation. EHR vendors already track
    and record many data points used for PI reporting, so there is no need
    to continue to use physicians as reporting intermediaries. For
    instance, CMS's ``Support Electronic Referral Loops by Receiving and
    Incorporating Health Information'' PI measure groups summary of care
    records received and the reconciliation of clinical information into
    one process. Physicians are required to manage and report both the
    acceptance of summary documents and the reconciliation process. This
    tasks physicians with juggling the technical aspect of
    interoperability, i.e., digital document capture and incorporation, and
    the laborious process of reconciliation. In fact, our members view
    information reconciliation in an EHR as ``overwhelming'' and adding ``a
    lot of non-meaningful noise'' to their patients' charts.

        Instead of focusing on EHRs as a tool for measuring physician
    actions, more clarity is needed on whether the EHR was able to use the
    summary of care document without burdening the physician, whether the
    EHR was able to provide the physician with usable and actionable
    clinical information in a format that supports clinical decision
    making, and if the EHR enabled a closed-loop referral. Essentially,
    more needs to be done to understand how EHRs actually function and
    should function in the real world. This type and level of information
    is far more meaningful and valuable to physicians, CMS, and ONC, and
    should be what Federal EHR reporting programs promote. Analyzing this
    information would expose the usefulness of the EHR, if the EHR could
    accommodate the needs of the physician, whether the EHR contributed to
    or detracted from patient care, and whether the EHR supported the goal
    of health information exchange. Knowing this will also help EHR vendors
    build better products. Opportunely, because EHRs already track what
    functionalities are used to perform tasks, EHR vendors should directly
    provide such information to CMS and ONC. This data capture mechanism
    also conveniently provides an audit trail for CMS.

        Congress should work with ONC and CMS to implement a ``record once,
    reuse multiple times'' approach, leveraging EHR-captured data for
    multiple needs--including CMS's Promoting Interoperability programs and
    to inform EHR development going forward. To be clear, the intent is to
    reduce the reporting requirements on physicians by using EHR-captured
    data--provided by the EHR vendor--as an alternative, supplement, or
    direct replacement for physician reporting in programs like Promoting
    Interoperability. Ideally, EHR vendors would report on how a measure
    was achieved and physicians would attest (as discussed in the previous
    section) to their experience in meeting that measure. This not only
    reduces physician reporting burden, but also creates a feedback loop to
    EHR vendors--allowing them to improve EHR use based on physician need.
    The AMA strongly suggests Congress work with ONC and CMS to identify a
    plan to operationalize this concept. We offer our assistance in further
    reducing physician burden through this and other novel approaches.
            encourage coordination when developing quality measures
        Congress should encourage CMS and ONC to coordinate with health IT
    developers and measure stewards, including national medical societies,
    to ensure optimal development of electronic quality measures. Medical
    specialties should not be required to dilute measure development due to
    delinquencies in EHR data capture or reporting capabilities. EHR
    development continues to be shaped by Federal reporting requirements--
    not the needs of patients and physicians--which severely limits their
    ability to support actual patient care and improvement. Disconnecting
    the linkage between EHR development and Federal reporting requirements
    is also a crucial step in improving physician satisfaction.

        Question. Are the proposed data blocking rules enough to start
    encouraging better data sharing by the vendors?

        Answer. The proposed data blocking rules are one method to
    encourage data sharing. While the AMA supports several aspects of the
    proposed rules (e.g., promoting patient access, certifying APIs, and
    removing EHR vendor gag clauses), ONC's and CMS's broad interpretation
    of legislative language, compressed development and adoption timelines,
    complex regulatory requirements, and a misplaced emphasis on data
    quantity will dramatically impact patient privacy and safety, data
    security, and further exacerbate physician burden and concerns with
    health IT. Without addressing these issues, the U.S. Department of
    Health and Human Services (HHS) may fail at meeting the goals set out
    by Congress in the 21st Century Cures Act (Cures).
                                    privacy
        The problem: In the proposed rule, ONC did not indicate that it
    will create policy to help ensure patient privacy protections through
    the API. In other words, it is promoting API usage, but not requiring
    that the API technology include privacy and security controls. The
    technological capability to implement these controls exists, so if ONC
    doesn't implement controls, they are making a policy decision to not
    prioritize privacy. This is particularly concerning given ONC's
    information blocking proposal is more focused on requiring that data be
    shared.

        Why this is important: Mobile apps typically require a consumer to
    consent to all terms or not use the app at all. However, we've all read
    stories and studies about how smartphone apps share sensitive health
    information with third-parties, often without the knowledge of an
    individual.\6\ If patients access their and their family's health
    data--some of which is likely sensitive--through a smartphone, a
    patient must have a clear understanding of the potential uses of that
    data by app developers. Most patients will not be aware of who has
    access to their medical information, how and why they received it, and
    how it is being used (for example, an app may collect or use
    information for its own purposes, such as an insurer using health
    information to limit/exclude coverage for certain services, or may sell
    information to clients such as to an employer or a landlord). The
    downstream consequences of data being used in this way may ultimately
    erode a patient's privacy and willingness to disclose information to
    his or her physician.
    ---------------------------------------------------------------------------
        \6\ Examples: (1) The Wall Street Journal reported that Facebook
    collected sensitive health and demographic data from a user's cellphone
    apps, regardless of whether the individual had the Facebook app on his
    or her phone, and even if the individual had never signed up for
    Facebook. (2) Studies reported in the BMJ and JAMA have demonstrated
    that most apps do not share privacy policies with patients, and when
    they do, sometimes do not adhere to them. (3) The Washington Post
    reported that a workplace wellness pregnancy-tracking app reports data
    to a woman's employer, including the woman's average age, number of
    children, and current trimester; the average time it took her to get
    pregnant; whether the pregnancy is high-risk, conceived after a stretch
    of infertility, a C-section or premature birth; and her return-to-work
    timing. The app's privacy notice is 6,000 words.

        How Congress can address the issue: Congress could encourage ONC in
    the final rule to require an EHR vendor's API to check for these three
    ``yes/no'' adoption and implementation attestations as a part of the
    ---------------------------------------------------------------------------
    EHR vendor's certification requirements:

            (1)  Industry-recognized development guidance (e.g., Xcertia's
            Privacy Guidelines);

            (2)  Transparency statements and best practices (e.g., Mobile
            Health App Developers: FTC Best Practices and CARIN Alliance
            Code of Conduct); and

            (3)  A model notice to patients (e.g., ONC's Model Privacy
            Notice).

        These could be viewed as ``value-add services'' as proposed by ONC.
    The app could be acknowledged or listed by the health IT developer
    (e.g., in an ``app store,'' ``verified app'' list). EHR vendors could
    also publicize app developers' attestations. This shouldn't be a
    significant burden on EHR vendors since it's only requiring that an API
    check for an app developer's attestation. We also recognize this
    wouldn't ensure apps implement or conform to their attestations.
    However, we believe this will provide a needed level of assurance to
    patients and physicians, and would be greatly welcomed by users. CMS
    should require app developers to attest ``yes'' to each of these items
    before listing an app on its BlueButton 2.0 website.
        presumption of guilt will result in significant physician burden
        The problem: Physicians may have a valid, reasonable reason to
    restrict the exchange of information. Yet ONC's interpretation of Cures
    creates an assumption that any physician who withholds data is guilty
    of information blocking. To counter this assumption and to justify
    withholding information for any reason, physicians must divert time and
    resources away from patient care to dissecting incredibly complex
    exceptions that are riddled with subjective terminology. Once a
    physician does so (potentially by hiring attorneys or consultants at
    great expense to the practice), he or she must create new policies and
    procedures, train staff, and adjust workflows. Furthermore, physicians
    may need to document the justification for applying those exceptions
    for every single request of information.

        Why this is important: The inherent presumption of guilt, complex
    sub-exceptions, and substantial added burdens of ONC's proposal exceed
    the scope of Cures' intent. ONC should create policies that identify
    bad actors without placing considerable burden on the rest of the
    health-care system. Otherwise physicians will be tasked, time and time
    again, with the chore of documenting decisions that should be left to
    the physician's best judgement. Or, alternatively, they will just share
    whatever information they are asked for, regardless of whether the
    requestor has valid reasons for doing so, and the physician risks
    penalties for that, too. In either scenario, physicians and patients
    lose.

        How Congress can address the issue: Congress can encourage ONC to
    clarify that a physician exercising his or her best judgement when
    providing information to a requestor will not be considered an
    information blocker. ONC should also remove onerous requirements for
    physician to document their decision-making associated with qualifying
    for information blocking exceptions or sub-exceptions.

        The AMA shares the administration's continued focus on improving
    interoperability and patient access across the U.S. Physicians and
    patients must be provided better access to needed clinical information
    while at the same time being assured privacy and security are
    strengthened. We look forward to continuing our work with Congress and
    administration to secure long-lasting revisions to health IT policy and
    implement the provisions in Cures.

        Question. How can we encourage States to be better innovators on
    health-care spending? The current Medicaid waivers incentivize States
    to keep costs down, but are there ways to encourage both lower costs
    and better health-care outcomes?

        Answer. MACRA was enacted almost 4 years ago, but most physicians
    still do not have opportunities to participate in APMs that meet the
    criteria for the bonus payments authorized by Congress. Congress
    authorized these payments not just as an incentive to participate in
    APMs, but because it recognized the time and costs physicians will face
    in transitioning to APMs. MACRA only authorized 6 years of APM bonus
    payments, and the current 2019 performance period is halfway through
    the available time to earn them. We urge Congress to extend this time
    period for more years so that physicians will have the opportunity to
    receive all of the support intended. Additionally, Congress can
    encourage APMs to control spending and improve quality in Medicaid by
    modifying the ``all payer'' requirement for a physician to become a
    qualified APM participant under MACRA. The rules for becoming qualified
    should encourage Medicaid and multi-payer APMs, but the current rules
    can actually discourage physicians from participating in Medicaid APMs
    because they would then need to meet an ``all-payer'' threshold of APM
    participation to qualify for the MACRA incentive payment.

                                     ______

               Questions Submitted by Hon. Catherine Cortez Masto
        Question. Nevada has one of the most significant health-care
    workforce shortages in the country. What kind of impact is MACRA having
    on the physician workforce? Are there ways to leverage the law to build
    that work force?

        Answer. In order to prevent health-care workforce shortages around
    the country, the AMA has urged Congress to replace the upcoming
    physician payment freeze with annual positive payment updates over the
    next several years. MACRA included modest positive payment updates in
    the Medicare Physician Fee Schedule, but it left a 6-year gap from
    2020--next year--through 2025 during which there are no updates at all.
    Following this 6-year freeze, the law specifies physician payment rate
    updates of 0.75 percent or 0.25 percent for physicians participating in
    APMs or MIPS, respectively. By contrast, other Medicare providers will
    continue to receive regular, more stable updates. As physician practice
    payments fall increasingly below their costs, patient access issues
    would arise. Rural health care will be more affected than other areas
    because increasing costs are spread across fewer patients, and many
    health-care employees can demand higher salaries that in urban areas
    where more applicants reside.

        The recent ``2019 Annual Report of the Board of Trustees of the
    Federal Hospital Insurance and Federal Supplementary Medical Insurance
    Trust Funds'' (``Medicare Trustees Report'') found that scheduled
    physician payment amounts are not expected to keep pace with the
    average rate of physician cost increases, which are forecast to average
    2.2 percent per year in the long range. The Medicare Trustees Report
    also found that ``absent a change in the delivery system or level of
    update by subsequent legislation, the Trustees expect access to
    Medicare-participating physicians to become a significant issue in the
    long term.'' Therefore, to ensure the health-care workforce shortage
    does not increase and to provide physicians with a stable and
    sustainable revenue source that allows them a margin to invest in
    practice improvements and transition to more efficient models of care
    delivery, the AMA urges Congress to replace the upcoming physician pay
    freeze with annual positive payment updates.

        MACRA included $20 million per year through 2020 to support the
    administration of technical assistance to help small and rural
    practices comply with the law's reporting requirements. Almost $35
    million will be left as of this coming January, to remain available
    until expended.

        Question. In your experience, has that assistance been helpful or
    successful?

        Answer. While the AMA has strongly supported the provision of
    technical assistance to small and rural practices, and believes it is
    an important tool to make available to these physician groups, this
    technical assistance is not enough. Congress, CMS and the physician
    community must continue to work together to help small and rural
    practices succeed in the Quality Payment Program.

        Question. Are practices aware of the availability of technical
    assistance? If not, what should we be doing to make them aware?

        Answer. The AMA has worked with CMS to try and make physicians in
    all practices sizes and all specialties aware of the technical
    assistance that is offered by the agency.

        Question. Looking forward, do you see that $35 million as
    sufficient to meet the needs of providers who are struggling to comply
    with MIPS?

        Answer. The AMA encourages Congress to continue to fund technical
    assistance to help small and rural practices comply with the Quality
    Payment Program. In 2017, the national mean and median scores for all
    MIPS eligible clinicians were 74.01 and 88.97 points. However, the mean
    and median scores for small practices were 43.46 and 37.67. The lower
    scores achieved by small practices illustrate the need for Congress to
    work with the CMS and the physician community to continue to make
    changes that will help small practices and solo practitioners succeed
    in the program.

        While continued technical assistance for small practices is
    important, the simplest way to ensure small and rural practices remain
    viable is to maintain the low volume threshold. To eliminate or reduce
    the threshold and force physicians to participate in MIPS would kill
    small practices. Financially, it just does not make sense for these
    practices with limited resources to invest in MACRA compliance when
    they have such a small Medicare patient population.

        In addition, for those small practices that treat larger Medicare
    patient populations and participate in the MIPS program, the most
    helpful assistance comes in shaping the MIPS program to allow practices
    of all sizes to be successful. For example, the reduced reporting
    requirements for small practices in several of the MIPS reporting
    categories, hardship exemptions from the Promoting Interoperability
    performance category for qualifying small practices, or bonus points
    for small practices greatly help small practices succeed in MIPS.

        Question. Are grantees able to use that technical assistance
    funding to help practitioners develop admissions to PTAC? If not,
    should we consider such authority? Should that be under the same
    program or developed as a separate program?

        Answer. We agree more can be done to help physicians develop APM
    proposals. Having spent a year developing a proposal for PTAC, I can
    attest to the fact that the process is not easy and requires resources
    beyond the capability of most practices. Feedback from PTAC was very
    useful but PTAC was very concerned that it not overstep its limits, but
    more feedback would have been helpful. The AMA appreciated the
    Bipartisan Budget Act of 2018 provision that allowed the PTAC to
    provide initial feedback to proposal submitters. Unfortunately, the
    PTAC has indicated that it is still not able to provide technical
    assistance and data analyses to stakeholders who are developing
    proposals for its review. Additional technical corrections may be
    needed to provide the PTAC with more flexibility in this regard. In
    particular, the Bipartisan Budget Act of 2018 language stated that the
    PTAC can provide ``initial feedback'' on ``proposals.'' HHS, which
    provides staff support to PTAC, has determined that this means no
    feedback can be provided until a complete proposal is submitted. In
    addition, HHS has determined that PTAC's feedback cannot involve ``data
    or analyses whose only purpose is to aid further development of a
    proposal,'' ``technical assistance in the development of the proposed
    model,'' or ``instructions on how to remedy or fix any identified
    shortcoming(s).'' (These prohibitions are stated on page 14 of the PTAC
    ``Proposal Submission Instructions.'')

        Question. What portion of these providers do you think will never
    make it to an APM? Should we be concerned about that?

        Answer. Physicians understand MACRA implementation is evolving and
    they are regularly reevaluating their participation options to
    determine which pathway best supports them in providing high value care
    to their patients. There are many variables that influence a
    physician's participation decision, and most notable is the
    availability of APMs and their readiness to move to financial risk.
    Risk is a major impediment for many practices, as by definition, risk
    implies that the results will not always be positive. Practices
    generally don't have reserves to pay for a year where they must pay
    money back to CMS and they don't have the data analytic capabilities to
    determine how much risk they are taking on. For small practices, hiring
    a nurse educator to provide services for which there are no fees is a
    significant economic risk. To ensure a glide path to Advanced APMs, the
    AMA is urging Congress to extend the Advanced APM bonus payment to
    allow physicians a reasonable time period to transition to new payment
    models once they are made available. An APM should only put a physician
    at risk for the items they can control and never for so much risk that
    it could bankrupt the practice and destroy the infrastructure of care
    delivery.

        Additionally, the best way to increase physician participation in
    APMs is to give physicians a major role in designing and implementing
    new payment models so the payments support the services physicians feel
    are necessary and accountability is focused on aspects of quality and
    cost that physicians can control.

        Traditionally, APMs have been designed by payers in a top-down way.
    Physicians often feel that these models fail to provide the resources
    needed for high-value services or penalize them for delivering services
    their patients need. With the recent Primary Cares Initiative, CMMI is
    using proposals submitted to the PTAC by physicians to design its APMs
    and we welcome this change.

        The AMA supports a bottom-up approach that starts by having
    physicians identify the opportunities to reduce spending through
    improving patient care and then designing APMs that will support the
    appropriate changes in care delivery.

        Finally, many specialists simply do not fit into any of the current
    Advanced APMs. Often ACOs do not want to include them because their
    services are not needed frequently enough. Others have tried to develop
    models and submit them to PTAC, but CMS has not accepted them for
    further testing. There are signs now that CMS is more prepared to start
    testing PTAC recommended models, which is a very positive development.
    But this longer-than-expected ramp up period is why we are asking that
    the five percent incentive payments provided to early Advanced APM
    participants be extended in future legislation.

                                     ______

     Prepared Statement of Frank Opelka, M.D., FACS, Medical Director for
            Quality and Health Policy, American College of Surgeons
        The American College of Surgeons (ACS) thanks the Senate Finance
    Committee for convening a hearing on the implementation of the Medicare
    Access and CHIP Reauthorization Act (MACRA). ACS has a longstanding
    commitment to improving the quality of surgical care and we are
    grateful to Congress for making quality a focus of the MACRA law.
    However, ACS has concerns that this focus may have been obscured as the
    priorities and ideas of Congress and the broader stakeholder community
    who partnered in developing MACRA met the constraints of a hurried
    implementation. We welcome the opportunity to continue partnering with
    Congress and the administration to ensure that the goal of improving
    the value of care to the surgical patient stays at the forefront.
                acs supports the congressional intent of macra
                       but implementation misses the mark
        MACRA was intended to replace the failed cost containment strategy
    of the sustainable growth rate formula (SGR) by implementing payment
    incentives that rewarded physicians for improving quality and keeping
    down cost. In other words, the idea was to tie payment more closely to
    the value of care provided to the patient. Achieving this congressional
    intent in the area of surgery requires the establishment of a strategy
    for expressing what constitutes value in surgical care. This is not
    achievable using legacy Physician Quality Reporting System (PQRS) and
    Value-Based Payment Modifier (VM) measures. The Centers for Medicare
    and Medicaid Services (CMS) relied on their skills as a payer to
    retrofit their payment models with sporadic, disaggregated quality
    metrics. The end result has been disruption of the care teams and a
    disconnect from real quality of care. For many physicians, the Merit-
    based Incentive Payment System (MIPS) has not, and given its current
    trajectory will not, serve as a driver of improvement in quality or
    reduction of cost.

        In addition to these implementation issues, we also have great
    concerns about the structure of payments under MACRA in the years
    ahead. The modest statutory updates included in the law are now
    finished, and we will soon enter a 6-year period with no updates. This
    will likely result in real reductions to payments due to inflation and
    budget neutrality requirements. Additional incentives for high
    performers and qualified Alternative Payment Model (APM) participants
    also disappear during this time, which will be experienced as
    reductions by many of the highest performing physicians in Medicare.
    While the focus of the testimony today is improving incentives for
    quality and value, the ACS urges Congress to consider these factors as
    well. The ACS would welcome the opportunity to further describe the
    physician payment landscape from our perspective and how this might
    affect access to care in the future.
                      quality measurement in mips and apms
    ACS Vision for Meaningful Measurement Models
        ACS continues to welcome and celebrate the congressional focus on
    quality and value built into MACRA, including the concept of rewarding
    those who provide high-quality surgical care while holding down costs.
    However, CMS as a payer does not have the resources or knowledge to
    generate the master plan for quality for a surgical team working toward
    a patient outcome in a particular episode of surgical care and
    therefore must first fully collaborate with the surgical community.
    This collaboration would include (1) defining the patient-centered care
    model, (2) identifying the structure and processes required to deliver
    quality in surgical care, and (3) assigning quality metrics and
    attaching an incentive payment program to achieve care goals.

        Expressing value in surgical care requires appreciation of the
    specific condition and its care model, consideration for clinicians and
    their unique roles as team members in providing surgical care to the
    patient, and the ultimate outcome of that care. With this
    understanding, it is possible to define the critical data and
    measurement elements across the care model for the team, which is
    essential in driving improvement. What follows then is agnostic to the
    payment system; it is possible for CMS to use the various tools of
    MACRA to design a payment model either within Medicare fee-for-service
    (FFS) or within some form of APM.

        More specifically, by designing a master quality care plan for
    surgical care as the first step, these value-based models can be
    tailored to a broad range of payment models such as FFS in MIPS,
    Accountable Care Organizations (ACOs), bundled payments such as the
    Bundled Payment for Care Improvement--Advanced (BPCI-A) model, or other
    APMs. This master quality care plan would be used to measure quality
    across all payment programs so that the care team has one valid and
    meaningful quality target to define value for surgical care. Such an
    effort will also greatly reduce burden.

        The ACS developed a model formula that could serve as the
    foundation for quality in surgical care. The ACS model formula for
    expressing value in care does not differ from those found in other
    industries. ACS believes that quality of care begins by setting
    evidence-based standards for care, ensuring that the right
    infrastructure and systems are in place through measurement and
    verification, and incorporating data at the point of care to inform
    surgeons' and patients' decisions. The patient should have a voice to
    determine whether the treatment met his/her goals. We define the
    episodes for a given domain such as trauma care, cancer care, or
    complex gastrointestinal care as examples and assign a surgeon
    champion. Within each of these domains, evidence-based, common
    standards are applied for areas that affect all surgical patients.
    Specific standards can also be applied for each individual surgical
    episode or condition. With the proper standards, infrastructure, data,
    and verification we can greatly improve outcomes and patient safety
    while simultaneously reducing complications and other unnecessary
    costs. If implemented correctly, the data generated helps to feed
    research into which interventions and care are most effective, creating
    a beneficial cycle of quality improvement. This marriage of quality and
    cost for a given treatment, condition, or episode of care is a true
    representation of value.
    QPP Incentivizes Check-the-Box Compliance Instead of Striving for
            Quality Improvement
        An increasing number of surgeons recognize that CMS efforts are not
    contributing to higher quality surgical care. The rational response is
    for surgeons and/or health care administrators to simplify their
    engagement in MIPS by taking the necessary steps to assure payment
    rather than to focus on quality. The figure below illustrates that the
    Quality Payment Program (QPP) is designed around how services are paid
    for, using aspects of claims transaction as a proxy for quality and
    measurement of ``success,'' at the level of the tax identification
    number (TIN). The current measurement system does not consider the
    patient's care journey and does not represent a patient's experience.
    For example, an ever-greater percent of surgeons are participating in
    quality reporting through the CMS Web Interface group reporting option.
    This translates into reports based on large groups of physicians
    (frequently providing care for very different patients and conditions)
    gathered under one TIN. It does not translate down to the care a
    surgical patient receives. In other words, surgeons receive credit for
    how well their group immunizes a population instead of assuring
    patients have safe surgical care.

    [GRAPHIC] [TIFF OMITTED] T5819.002

        Currently, much QPP reporting takes place in the CMS Web Interface
    option, which allows groups of at least 25 eligible clinicians with the
    same TIN or participants in certain ACOs to submit data together and be
    measured as a single unit. The Web Interface is a stable, known program
    to administrators. They know what their scores are likely to be, and it
    is built into the workflow for their organization. While easy for
    physicians to comply with, the ten measures available in the Web
    Interface are focused on screening, preventive care, and diabetes
    control. These measures are important to a patient's overall health but
    provide absolutely no information on the quality of surgical care
    received by patients of surgeons in these groups and therefore are not
    relevant to efforts to improve surgical quality.

        MIPS participants can choose to report both as part of a group and
    as an individual, but the majority of surgeons are unlikely or unable
    to do so due to financial implications. Administrators and the C-Suite
    often decide the most cost-effective way for the TIN to report in MIPS,
    and specialty specific reporting may result in a lower MIPS score. In
    fact, performance data from the first year of MIPS shows that the
    median score of groups was more than 50 percent higher than that of
    those who participated as individuals. For clinicians who still choose
    to report specialty-specific measures, those available are not patient
    focused, frequently dating back to the PQRS program, and are designed
    for an exclusively FFS world. Furthermore, new measures without a
    benchmark can only receive the lowest amount of points. These problems
    stem from how CMS has set up reporting incentives, favoring large group
    reporting on primary care.

        Many believed that Qualified Clinical Data Registries (QCDRs) which
    are referenced more than 20 times in MACRA, would be a key pathway for
    stakeholders to influence quality measures. However, roadblocks emerged
    that impeded the ability of specialty societies to measure quality
    based on what matters most to their patients. There is a huge
    disincentive to use QCDRs for many specialties, such as the constant
    annual removal of measures, and very low opportunities for earning
    points. New measures without a benchmark receive the lowest point
    value. This has greatly limited the value and uptake of these
    registries.

        Data rigor and aggregation standards are also crucial to registry
    success. As a payer, CMS has little ability and expertise to utilize
    these registry elements and value these tools within their current
    measurement systems, resulting in a cacophony of reports that are
    meaningless to the end user. Only when registries have standardized
    data, aggregation, normalization, and reporting from a single source of
    truth are they of value. This is evident in registries maintained by
    ACS. Registries and the information they provide are best implemented
    within an overall care plan where a team of experts use the knowledge
    imparted to inform the patients and the team members about clinical
    care based on rigorous data. The ACS continues to work to demonstrate
    how to structure data models for care improvement.

        In sum, CMS's implementation of MACRA has fostered a payment model
    rather than first focusing on quality. As a result, surgeons currently
    lack confidence in CMS as a source of quality reporting. Thus, we
    expect more surgeons will be reporting through the group reporting
    options, which constitutes the path of least resistance. This is
    unfortunate since it may have the additional consequence of crowding
    out other efforts aimed at improving quality in surgical care and areas
    that are not incentivized. It also seems counter to the intent of MACRA
    which encouraged CMS to seek comprehensive measurement of groups. The
    statute notes that to the extent practicable, group measurement should
    reflect the range of items and services furnished by the eligible
    clinicians in the group. This is not currently the reality in the CMS
    Web Interface.
    A Way Forward in the QPP: Proposed ACS Measurement Framework for Value-
            Based Care
        The ACS proposes alternate quality measurement structures for the
    QPP based on our more than a century of experience in surgical quality
    improvement. This focus on quality resulted in the publication in 2017
    of ``Optimal Resources for Surgical Quality and Safety,'' referred to
    as the Red Book. This comprehensive volume serves as a manual for those
    seeking to build a learning environment designed to provide patient-
    centered, high-quality care. Standards drawn from the Red Book are now
    being used for the verification and accreditation of hospitals on the
    basis of surgical quality and patient safety.

        The ACS alternative framework for surgical quality measurement is
    comprised of three components:

            1.  Verification of Key Standards of Care: Since the inception
            of the ACS, we have sought to build standards for clinical
            domains with the expectation to improve overall outcomes of
            surgical care. While implementing these standards, we have
            gained over a half-century of experience in building clinical
            verification programs in specific clinical domains to drive
            quality, improvement, and excellence in care. The success of
            verification programs are well-established in the peer-reviewed
            literature. Each of the major surgical domains contain a set of
            standards for inclusion in a renewable, triennial verification
            program. The long-term goal is to scale these verification
            programs initially through pilot testing, then as a
            foundational component to building a national quality system in
            surgical care.

            2.  Clinical Outcome Measures: We envision the use of
            administrative claims measures for surgical procedures that
            have a low event rate of care for poor outcomes (readmissions,
            mortality, reoperation, etc.), and propose using programs such
            as the National Surgical Quality Improvement Program (NSQIP),
            for complex, high risk care that have variation in outcomes and
            require risk adjusted, clinical outcome measurement with a high
            level of rigor. This would require pilot testing before large-
            scale implementation.

            3.  Patient-Reported Outcomes: In addition to standards-based
            verification programs and clinical outcome measures, we propose
            inclusion of patient-
            reported outcomes measures (PROMs) based on an episode of care.
            Episode-based PROMs are inclusive of the patient's voice and
            can assess whether care achieves the patient's goals, including
            functional outcomes and quality of life. We have begun early
            testing and development of enriched PROMs, focused on surgical
            outcomes. This model is designed to recognize the complexity of
            modern medicine and demonstrate that it exceeds the ability of
            a single physician to provide all of the care.

        This framework, which is illustrated in the figure below, is based
    on decades of research and implementation of verification programs,
    which have proven successful in driving better outcomes in surgical
    care. It is applicable across various clinical domains, particularly in
    surgery where robust verification programs exist in areas such as
    cancer care, trauma care, bariatric care, and care for frail geriatric
    patients. Such programs depend on triennial surveys, and already exist
    in thousands of delivery systems today with demonstrated success. As an
    example, measurement of cancer care spans the entire care journey
    experienced by patients and includes areas such as prevention,
    screening, early diagnosis, treatment, post treatment surveillance, and
    end-of-life care. A surgical resection for cancer may involve debulking
    and staging the disease, while also including a method for tracking
    quality through verification of key standards, PROMs, and clinical
    outcomes. Furthermore, if such a quality framework were combined with
    the ongoing cost measurement work that formed the core of the ACS-
    Brandeis Advanced APM described below, then this would constitute
    quality and cost measurement across standardized episodes of care
    representing true value to the patient.

    [GRAPHIC] [TIFF OMITTED] T5819.003

               ptac recommendations to pilot apms not actualized
        In addition to MIPS, MACRA created a separate option for
    participation through APMs. Since quality measurement in APMs is
    required only to be ``comparable'' to that in MIPS, APMs were
    considered an attractive option to propose innovative measures and new
    concepts. The inclusion of the Physician-focused Payment Model
    Technical Advisory Committee (PTAC) in MACRA was seen by many in the
    physician community as a positive step. MACRA payment incentives and
    the establishment of PTAC encouraged the development of physician led
    models, creating a clear pathway for the transition from FFS to APMs.

        ACS recognized the importance of the value transformation in
    healthcare through APMs and partnered with experts in episode-based
    cost measurement at Brandeis University to develop the first proposal
    received, evaluated, and ultimately recommended by the PTAC in April
    2017. The ACS-Brandeis Advanced APM proposal incorporated cutting edge
    cost and quality measurement beyond that currently required by CMS in
    the FFS world into a new value expression. The PTAC thoroughly vetted
    the model both through written requests for information and at an in-
    person meeting. PTAC ultimately agreed that the proposal satisfied
    their quality criteria. Unfortunately, the ACS model and many other
    models recommended for testing or implementation in the QPP have not
    been acted upon, closing another door for truly meaningful quality
    measurement.
                                    summary
        MACRA promotes innovative quality and cost measures as well as the
    development of alternative payment models. We welcomed the legislative
    intent to improve care and have been hopeful the implementation of the
    law would promote meaningful surgical quality over the burdensome,
    insignificant measures used in many of the previous payment programs.
    Without real meaningful quality measurement, MACRA will fall short of
    achieving the aspirations of patient-centered quality care. The QPP as
    it currently stands fails to provide meaningful quality measurement and
    is in need of a course correction.

        ACS holds that what matters most to patients and providers is
    safer, more efficient, and higher-quality care. It is with these goals
    in mind that we designed our proposed measurement framework for value-
    based surgical care. Congress should encourage CMS to partner with
    clinical stakeholders to evaluate and test innovative, evidence-based
    proposals such as the one we have described. We believe CMS has the
    authority to accomplish this but may benefit from additional guidance
    from Congress. CMS may require additional resources to increase their
    ability to accept meaningful data and administer the QPP in a way that
    supplies participants with the tools and data they need to improve
    value, and patients with the information they need to make the best
    possible choices for their care. Creation of a formal process for
    partnerships with the physician community on efforts to improve value
    for patients could help improve the quality of care for Medicare
    patients and truly refocus the incentives in MIPS toward higher value
    care. This would go a long way toward ensuring the long-term viability
    and success of the QPP and MACRA.

                                     ______

         Questions Submitted for the Record to Frank Opelka, M.D., FACS
                    Questions Submitted by Hon. Rob Portman
        Question. I introduced the Medicare Care Coordination Improvement
    Act with Senator Bennet in an effort to reduce some of the barriers
    that providers face when they participate in alternative payment
    models. However, one particular section of my bill focuses on providing
    temporary waivers to practices that are interested in testing their own
    APMs. HHS has been slow to take up new APM concepts, and thus: what can
    we do to incentivize the establishment of new APMs? Has the PTAC
    offered a viable way to propose and test new APMs? If not, what actions
    could be taken to encourage the adoption of PTAC models?

        Answer. The American College of Surgeons (ACS) thanks Senator
    Portman for the opportunity to provide feedback on ways to incentivize
    new Alternative Payment Model (APM) development. The ACS is supportive
    of the Medicare Care Coordination Improvement Act, as it will likely
    help to spur more APM development. However, it is imperative that CMS
    has the tools and commitment to implement new and innovative payment
    models.

        Because quality measurement in APMs is required only to be
    ``comparable'' to that in the Merit-based Incentive Payment System
    (MIPS), APMs were considered an attractive option to propose innovative
    measures and new concepts. The inclusion of the Physician-focused
    Payment Model Technical Advisory Committee (PTAC) in Medicare Access
    and CHIP Reauthorization Act (MACRA) was seen by many in the physician
    community as a positive step. MACRA payment incentives and the
    establishment of PTAC encouraged the development of physician led
    models, creating a clear pathway for the transition from fee-for-
    service (FFS) to APMs.

        ACS recognized the importance of the value transformation in health
    care through APMs and partnered with experts in episode-based cost
    measurement at Brandeis University to develop the first proposal
    received, evaluated, and ultimately recommended by the PTAC in April
    2017. The ACS-Brandeis Advanced APM proposal incorporated cutting edge
    cost and quality measurement--beyond that currently required by CMS in
    the FFS world--into a new value expression. The PTAC thoroughly vetted
    the model both through written requests for information and at an in-
    person meeting. PTAC ultimately agreed that the proposal satisfied
    their quality criteria. Unfortunately, the ACS model and many other
    models recommended for testing or implementation in the Quality Payment
    Program (QPP) have not been acted upon, closing another door for truly
    meaningful quality measurement.

        Question. Per data from CMS, about half of all Medicare providers
    are participating in MIPS, with the majority of these non-participating
    providers being exempt via the low-volume threshold. While we don't
    want to place additional burdens on small and rural providers, we
    should be identifying ways to engage with these practices to help them
    transition towards value-based outcomes.

        What actions should be taken to engage with these providers?

        Answer. The ACS shares your concern for small and rural physicians,
    but believes it is fortunate that they are currently exempted from
    MIPS. Until there are meaningful measures, these physicians should
    remain focused on properly treating patients rather than complying with
    burdensome meaningless activities.

                                     ______

                     Questions Submitted by Hon. Ron Wyden
        Question. As I mentioned during the hearing, I often hear from
    seniors in Oregon that they don't feel like anyone is in charge of
    managing their health care and helping them navigate the health-care
    system. I am proud of the bipartisan work that this committee did on
    the CHRONIC Care Act last Congress to update the Medicare guarantee. In
    my view, the next step should be making sure that all Medicare
    beneficiaries with chronic illnesses have someone running point on
    their health care--in other words, a chronic care point guard--
    regardless of whether they get their care through Medicare Advantage
    (MA), an accountable care organization (ACO) or other alternative
    payment model, or traditional fee-for-service Medicare.

        For beneficiaries in traditional fee-for-service Medicare, what can
    be done to improve care coordination and make sure their physicians and
    other health-care professionals are all talking to each other and
    working together to provide the best possible care to those
    beneficiaries? What specific policies would you recommend this
    committee pursue toward that end?

        Please describe the specific steps that Congress and/or CMS could
    take to ensure all Medicare beneficiaries with chronic illnesses,
    including those in traditional fee-for-service Medicare, have a chronic
    care point guard.

        Answer. The ACS thanks Senator Wyden for the opportunity to provide
    feedback on improving care coordination for patients with chronic
    illnesses. The ACS represents surgeons and their patients, many of whom
    are faced with chronic conditions which tend to complicate their
    surgical care. It is important that the Congress and the Centers for
    Medicare and Medicaid Services (CMS) begin to recognize that the
    health-care sector is no longer represented by cottage industries in a
    simple transactional business, with one stop shopping for care.
    Instead, the current system utilizes a continuum of care which is
    extraordinarily complex. Modern care models have advanced to team-based
    care with the patient in the center.

        The ACS understands the concerns of Senator Wyden's constituents
    regarding their need for a ``point guard.'' This analogy is quite
    fitting. The point guard is an active participant as well as the in-
    the-game coach guiding her team. Modern day treatments are too complex
    for any one physician or surgeon to assume all responsibility for
    optimal care. Care occurs in teams of clinicians working together to
    optimize the outcome and meet the goals of the patients.

        Yet, the actions of fee-for-service and CMS have been detrimental
    to the modern-day care models. No point guard operates alone or can win
    the game by herself. It takes all of the team members working in
    concert to accomplish the complex outcomes patients seek. While the
    care models have advanced to team-based care, with the patient in the
    center, the business models and payment models are lagging. Physicians
    are still competing to be the source of care which is paid, rather than
    optimally serving the patients as a team. The over-emphasis on one
    member of the team and not on the entire team is detrimental to the
    overall goal. If the only member of the team is the point guard, what
    would you expect the reaction to be from all the other team members who
    are so essential in assuring the best outcome?

        Everyone has a role to play and everyone is essential to lift up
    all their teammates in their roles. As exuberance builds for the point
    guards, let us not forget how to build the entire team toward the
    excellence in outcomes we seek.

        In order to make this actionable, there are several aspects of
    modern care which need to be rewired in order to create sustainable
    transformation of care. First, the most important focus has to move
    from payment models and an electronic health record (EHR) focus to
    center attention on the actual care model. Care models are now team-
    based care models with the point guards as primary care physicians
    (PCPs) coordinating with patients and a broad array of specialty
    medicine, including surgeons. Operationalizing the care models are
    business models which refer to how clinical practices pull together the
    essential resources to optimal practice (staff, equipment, information
    services, inter office communication, finance etc.). Once the care
    model and business models have taken shape, the practice revenue models
    or payment models have to match the care model with a payment model.
    Some conditions are self-limited, with brief care models which may be
    simply managed by one physician, the care model will be narrow and
    brief making fee for service a rational choice. Other aspects of care
    are far more complex and require team-based revenue models. Payers need
    to think about how to ultimately drive the best care models and
    resources for business models in rethinking payment and not simply
    tweak around the edges of fee-for-service.

        Beyond these three aspects of care models, business models and
    payment models are the actual physician compensation models. Physicians
    are primarily compensated based on relative work units and not on how
    patients feel about achieving their outcomes making it rational for a
    physician to drive toward more work units for compensation. This is
    driving volume of services to higher levels and not always for the
    right reason. In order to move away from volume-based payment,
    compensation plans need to become linked to value, and be designed with
    team-based care in mind.

        In order to achieve the goals of care coordination, more needs to
    be done to ensure that digital health information services are not
    heavily siloed by EHRs. Patients not uncommonly have different parts of
    their health in different EHRs. So their health information becomes
    siloed. To move towards breaking down silos, Congress should envision a
    digital information health system as a service to patients, Software as
    a Service (SaaS). This can be achieved by building an open standard,
    patient cloud and requiring every EHR to conform to providing data to
    clouds which conform to the standard. By doing so, this will ensure
    that patients, point guards (PCPs), and all other medical specialties
    are able to see the entire patient record and not just one site's EHR
    view of a patient. Patients' data live in more than one EHR and more
    than EHRs can talk to clouds in today's world of the Internet of Things
    (IoT). To fully enable the care model, the business model, the payment
    and compensation model, and to create a complete team for
    accountability requires a digital ecosystem well beyond the constraints
    of an EHR. This ecosystem is struggling to emerge because of the
    constraints by EHR vendors, by an over emphasis of EHR solutions rather
    than cloud solutions, and by the lack of a personal medical
    identification number which is essential for creating a unique patient
    record in the cloud. The care patients would receive for having such an
    open source cloud architecture would take digital health services to a
    new level. Congress needs to reduce the complexity surrounding digital
    health services and expand the opportunity by empowering Federal
    agencies to work collaboratively within the government and with the
    private sector.

        Question. Eligible clinicians who receive a certain percentage of
    their payments or see a certain percentage of their patients through
    Advanced APMs are excluded from MIPS and qualify for the 5-percent
    incentive payment for payment years 2019 through 2024. Starting this
    year (performance year 2019), eligible clinicians may also become
    qualifying APM participants (and thus qualify for incentive payments in
    2021) based in part on participation in Other Payer Advanced APMs
    developed by non-Medicare payers, such as private insurers, including
    Medicare Advantage plans, or State Medicaid programs.

        Recognizing that this is the first year in which the All-Payer
    Combination Option is available, how many of your members do you
    anticipate will take advantage of the All-Payer Combination Option this
    year?

        What, if any, challenges have your members faced when attempting to
    take advantage of the All-Payer Combination Option?

        Answer. We appreciate the Congress's efforts to expand eligibility
    for inclusion in incentives for payment through the Advanced APM (A-
    APM) and recognizing All-Payer Combination options. Our members are
    divided into two broad classes when thinking of payment in A-APMs. One
    group includes our employed surgeons and the other group includes the
    self-employed surgeons. The employed surgeons are typically part of
    larger contract groups and are pulled into commercial models based on
    enterprise contracting. The self-employed surgeons struggle more with
    complex risk-based contracting and would prefer to remain in fee-for-
    service MIPS programs. The self-employed are smaller group practices
    which lack the ability to assume much in terms of risk, do not have the
    data infrastructure for risk based contracting, and cannot manage risk
    in general.

        In addition, the current CMS implementations for A-APMs are
    typically payment models based on fee-for-service, but are not
    necessarily built on a care model. As such, care remains fragmented
    even while in bundles which contain fragments of fees for various
    services provided. If the intent of MACRA is to truly focus on
    improving quality and reducing costly waste by using risk-based payment
    models to affect real change, consideration has to begin with building
    care models which are suited for all types of patients, their
    conditions, and a broad array of practice types. Thoughtful design of
    APMs requires input from the physician community in order to appreciate
    the interrelationships of how care is delivered. This will require a
    means for bringing teams together for patient care, with shared risks
    through aligned incentives, openly shared common data dashboards. This
    will need to be consumable by small group practices in rural America as
    well as in large delivery systems.

        For now, all-payer activities are not standardized, with each payer
    creating their own iteration of the various aspects of an APM. This
    creates chaos at the point of care. It is difficult for a team of
    clinicians to understand the nuances of various payment models between
    insurers, when the real focus should be on a patient. For the
    government to promote all-payer models, first we need the government to
    realize all the aspects of care and business practices which need to be
    standardized.

        Just imagine a single procedure such as a lung resection or a
    cardiac bypass. If ten payers each had their own prior authorization
    rules, their own data elements, variation in their applications of risk
    based contracting, and different quality metrics, then these ten payers
    multiplied by four sets of variables would create forty variables;
    which are too burdensome for a system to manage. This is for only one
    procedure and it has already reached the level of being an unmanageable
    burden. Ultimately, surgeons would end up chasing after payment rules
    and differences between payers rather than clinical care, with a
    significant impact on both patients and surgeons.

                                     ______

                   Question Submitted by Hon. Debbie Stabenow
        Question. I am very proud of the work the bipartisan
    accomplishments to address Alzheimer's, including the implementation of
    my HOPE for Alzheimer's Act which required Medicare to pay for new
    individual care plans to support Alzheimer's patients and their
    families. Many of my colleagues are also cosponsors of my Improving
    HOPE for Alzheimer's Act, which will ensure beneficiaries and
    physicians know that they are able to access, and bill for, care
    planning under Medicare. In our last hearing on MACRA implementation,
    my colleagues raised the question of how we should look at quality
    measures in MIPS when it comes to physicians having these conversations
    with beneficiaries and their families and reflecting their priorities.
    Some have mentioned altering MIPS to make the quality measures more
    clinically meaningful. In what ways do you think the system would need
    to change to better incorporate long-term care planning and encourage
    physicians to have these conversations with patients?

        Answer. The American College of Surgeons (ACS) thanks Senator
    Stabenow for the opportunity to provide feedback on meaningful quality
    measurement under the MIPs program. While most surgeons do not engage
    in long-term care planning, the ACS maintains that CMS should work with
    stakeholders to develop measures that are more meaningful to providers,
    with the goal of improving the value of care.

                                     ______

                   Questions Submitted by Hon. Sherrod Brown
                           the patient voice in macra
        Question. In your testimony, you mention the importance of patient-
    reported outcomes. I agree that we should be measuring whether or not
    we are paying for care that is in line with the patient's goals. During
    the hearing I asked you how many of the 424 MIPS measures consider the
    patient voice and their priorities. You told me that zero of the
    surgical measures in the payment program are patient reported outcomes.

        What more can your physician organization do to ensure patient
    needs and priorities are kept at the center of health-care delivery?

        What more can and should CMS and Congress do to ensure patient
    needs and priorities are kept at the center of health-care delivery?

        Answer. The American College of Surgeons (ACS) thanks Senator Brown
    for the opportunity to provide feedback related to the inclusion of
    patient needs and priorities in care delivery. Ensuring patient needs
    and priorities are communicated and met is especially critical in the
    delivery of surgical care because most surgical procedures are elective
    and performed with the goal of improving a patient's well-being.
    Therefore patient reported outcomes (PROs) are the best determinant of
    whether an operation was successful. Some examples of PROs include
    measurement of functional goal attainment, severity of symptoms,
    quality of life, etc.

        To be inclusive of the patient's voice, we have to move away from
    collecting patient reported data in the form of long surveys
    administered after a hospital stay or procedure, such as the Clinician
    and Group Consumer Assessment of Healthcare Providers and Systems
    (CAHPS) surveys (currently part of the MIPS program). These
    retrospective PROs do not provide an opportunity to address patient
    needs during their care journey.

        We believe that the integration of the patient experiences and
    milestones within the clinician workflow, including the collection of
    PROs in more frequent, but brief, occurrences throughout their episode
    of care, can provide meaningful information to physicians. Information
    such as progress on care goals, post-surgical recovery, pain
    management, and rehab and therapy are critical to ensuring meaningful
    care delivery. This will enable a more patient-centric approach to
    surgery while facilitating shared decision making and increased
    communication with the patient and surgical team.

        To scale PROs nationally, patient portals and third-party
    applications connected to EHRs through application programming
    interfaces (APIs) could create additional options for the patient's
    voice become a part of clinical decision-making. This would create a
    simple interface for users to respond to questions and share data back
    to their physicians. There is a great opportunity through the
    implementation of 21st Century Cures to leverage technology to achieve
    these goals.

        In the short term, CMS should leverage current resources to
    prioritize outcomes that matter to patients with the use of the PROs to
    receive frequent patient feedback across a patient's care journey, as
    described above. One immediate action CMS should take is to immediately
    distribute the funding available through the MACRA Measurement
    Development for the QPP to develop, test, and implement PROs to measure
    care across the care continuum fit for value-based payment models.

        In the longer term, we urge CMS to build a value framework based on
    what matters most to patients--safer, efficient and high-quality care.
    To do so, payers need to think about how to ultimately drive the best
    care models and resources for business models instead of designing
    quality measures based on fee-for-service transactions without measures
    that map to the care a patient experiences. True patient-centric
    quality should measure the patient outcome and have shared
    accountability for the entire team while ensuring the appropriate
    resources and risk-adjusted clinical data are available for quality
    improvement and patient safety. Below is a figure that details how to
    achieve patient-centric value and improvement across an episode of care
    by the use of:

            1.  Verification of key standards of care (such as the ACS
            trauma verification program).
            2.  Patient-reported outcome measures.
            3.  Clinical outcome measures.

            [GRAPHIC] [TIFF OMITTED] T5819.004

        This framework is based on decades of research and implementation
    in verification programs, which have proven successful in driving
    better surgical outcomes, and is supported by over 2,000 publications
    in the literature. The proposed framework includes patient-reported
    outcomes, which will need to be tested. Our proposal is based on the
    simple tenet that patient-centric quality should measure the patient
    outcome and incorporate shared accountability for the entire team.

        This model relies on validation of successes by measuring outcomes
    using clinical data analytics, which partially depend on bi-directional
    automated interoperability for data exchanges to and from registries.
    Our proposal is simultaneously integrated into surgical workflows,
    while reducing burden by measuring compliance with standards through
    triennial surveys, rather than measures linked to CPT or diagnosis-
    related group (DRG) codes. Such surveys exist in thousands of delivery
    systems today, with demonstrated success in trauma, cancer, and
    bariatric surgery.
                        development of metrics in macra
        Question. I have heard from a number of physicians who believe that
    there is no link between many of the MIPS measures they are required to
    report and improving clinical care for their patients. I understand
    that the physician community has engaged with CMS to try and make the
    program more meaningful to physicians and patients through more
    relevant quality measures.

        How are clinicians from your organization involved the creation of
    these measures relevant to their specialties?

        Has CMS been receptive to your feedback when provided?

        How would you assess CMS's collaboration on achieving meaningful
    metrics?

        Are there any changes in this process you would recommend?

        Answer. A Majority of Surgeons Are Measured for Complying With
    Primary Care Measures: We do not believe that CMS has been receptive to
    our feedback because the majority of surgical care is not measured in
    the QPP. The program uses metrics broadly applied across physicians
    without a real appreciation for the details involved in surgical
    quality and improvement, despite suggestions from ACS and other
    specialties to design the program as such. Instead, most surgeons
    required to participate in the QPP are ranked based on measures in the
    CMS Web Interface or the Accountable Care Organization (ACO) Web
    Interface, which evaluate large group practices' compliance with
    primary care services, such as immunizations, blood pressure control,
    diabetes control, and tobacco cessation. These measures do not provide
    the information surgeons need to improve care, including critical
    patient safety indicators, or information patients seek when looking
    for a surgeon. Instead, compliance with these measures leads to added
    administrative burden and detracts resources away from highly
    successful quality improvement programs.

        This is a result of CMS developing the MIPS measure framework based
    on clinical services billed to Medicare based on a surgeon's TIN, not
    episodes of care. The measures are reported using a submission process
    that does not consider the care delivery model. The result is
    fragmented metrics that do not always map to the patient and the care
    model, as illustrated below:

    [GRAPHIC] [TIFF OMITTED] T5819.005

        CMS Does Not Value Conformance With Key Process Measures: Since the
    inception of the ACS, we have built standards for clinical domains with
    the expectation of improving overall outcomes of surgical care. Through
    this work, we have gained over a half-century of experience in building
    clinical verification programs for specific clinical domains. Each of
    the major surgical domains contains a set of standards as part of a
    renewable, triennial verification program. These programs have proven
    to drive quality, improvement, and excellence in care. Compliance with
    ACS verified standards (such as the ACS Trauma verification program)
    confirm appropriate structure and resources are in place for optimal
    care.

        However, the CMS ``topped out'' measure policy devalues these
    critical process measures by removing measures with a high performance
    rate. An example of a process measure that CMS has determined is topped
    out and plans to phase out of the program is use of the American
    College of Surgeons National Surgical Quality Improvement Program (ACS
    NSQIP) Surgical Risk Calculator measure. CMS policy does not value this
    measure, but the College maintains that every patient undergoing an
    operation should have access to a risk calculator that predicts the
    likelihood of a positive outcome. This step in preoperative planning
    provides an opportunity for the surgeon and the patient to engage in
    shared decision making, including whether an operation is the ideal
    form of treatment. Shared decision making does not occur commonly
    enough, but most patients consider it an essential part of care
    planning.

        CMS Is Reluctant to Test Innovative Physician-developed Models:
    MACRA payment policies and the establishment of Physician-focused
    Payment Model Technical Advisory Committee (PTAC) clearly incentivize
    the development of, and participation in, Alternative Payment Models
    (APMs). ACS and others have recognized the value of creating such
    models and have expended significant time, effort, and resources in
    doing so. The ACS-Brandeis Advanced Alternative Payment Model (A-APM),
    which was recommended by the PTAC but not implemented, would allow for
    the use of episode-based surgical measures meaningful to surgeons and
    surgical patients. The health-care community has rallied to meet
    Congress's challenge to develop new physician-focused models but the
    disconnect between the PTAC recommendation process and the testing of
    new models by CMS poses a significant barrier to innovation. Instead of
    testing new models developed by physicians, we continue to see
    variations on existing CMS models such as the Bundled Payments for Care
    Improvement (BPCI) Advanced or the ACO Track 1+. While we believe there
    is great merit in the move toward A-APMs and plan to continue work on
    developing core concepts of the ACS-Brandeis A-APM, it is unfortunate
    that the input from the broader health-care community has not led to
    the implementation of physician-built APMs by CMS.

        Additionally, MACRA allocated $15 million a year for 5 years
    starting in 2015 to incentivize the development of innovative quality
    measures. This money has been slow to flow to new measure development.
    This money was intended to be used to help fill gaps where measures
    fail to meaningfully measure care delivery, including surgical PROs.
    ACS submitted a proposal to CMS fund the development of a value-based
    measurement framework to measure surgical care, but funding was not
    granted.

                                     ______

                 Questions Submitted by Hon. Sheldon Whitehouse
        Question. Accountable Care Organizations (ACOs) have the potential
    to transform our health care delivery system. While we've seen ACOs
    improve patient care and create shared savings, many provider-led ACOs
    only control a small fraction of total spending, with specialists,
    pharmaceuticals, and hospitals accounting for most of it. This leads to
    ACOs lacking sufficient leverage to bring down costs and can contribute
    to shared losses.

        How can we improve the ACO model to account for this imbalance? How
    can we support successful ACOs and encourage more providers to follow
    their lead?

        Answer. The American College of Surgeons (ACS) thanks Senator
    Whitehouse for the opportunity to provide feedback on ways to improve
    Accountable Care Organization (ACO) models. The early wins in ACOs have
    come from the ``low-hanging fruit'' typically found in pharmacy costs,
    site of service differentials, excessive imaging usage, and excessive
    visits for patients with chronic conditions. These are common,
    recurring costs which are easily controlled by simple cost saving
    efforts.

        Taking ACOs to another level with the goal of transforming care,
    with the addition of medical specialties to the action plan, will
    involve a major redesign of care. Much has been made of primary care as
    the major source of savings without realizing the complexity of care
    today far exceeds the single-transactional mind-set of past care
    delivery. The science of medicine has outstripped the ability of a
    cottage industry for a single professional to remain current and
    practice the best care once the care required becomes complex. Modern
    care models have advanced to team-based care with the patient in the
    center. While basics in prevention and maintenance of care are still
    delivered between a patient and their doctor, once care becomes more
    complex, it takes a team to deliver the type of care needed to stay
    ahead of a condition or disease.

        Currently, most specialty-based medicine continues to be incented
    by fee-for-
    service revenues and volume-based compensation. To change their
    direction means taking steps to redesign the care models and their
    associated underlying business models. Underneath the care models and
    business models are needed complex data infrastructure to inform the
    entire care team of a patient's journey. These remain fragmented and
    difficult to manage in an ACO. Fee-for-service revenue models and
    compensation plans for physicians still predominate medical specialties
    even within ACOs. The infrastructure to craft the sort of change needed
    is taking shape but needs directional guidance and incentives from the
    government in order to accelerate the change for true health-care
    transformation. Total cost of care (TCOC) for an episode would provide
    patients and their medical teams the ability to understand the price of
    the medical goods and services incurred by patients and payers.
    However, if each payer performs their own cost of care model, the
    impact for patients and clinicians will be chaotic. A single standard
    is needed to apply all-payer claims data and determine the standard
    method for providing costs. The ACS has worked with the Centers for
    Medicare and Medicaid Services (CMS) to promote the CMS Episode Grouper
    Methodology and through our work with Remedy Health, Cerner, and
    Brandeis University, we have stepped up to create a TCOC system as a
    public utility for all to use in a new non-profit entity referred to as
    PACES--the Patient-Centered Episode System.

        The unit of analysis of specialty medicine, particularly surgical
    care, should expand to consider team-based episodes of care. These can
    be viewed as separate from an ACO or may reside as a bundle within an
    ACO population. To date, CMS has elected to carve out these episodes or
    bundles from the ACO and incent them as separate risk-based payment
    events. It may be easier to implement episode-based care as a carve-out
    from the ACO. This would leave more chronic care models within the ACOs
    where population-based care plans are better suited to population-based
    payments.

        Question. Our health-care system is not fully equipped to care for
    an aging population and patients with advanced illness such as late-
    stage cancer, Alzheimer's disease or dementia, or congestive heart
    failure. This is an area where we need new models of care that reflect
    these challenges and create a better system for providers, patients,
    and their families. Many of our current Medicare rules in this space
    are counterproductive, such as requiring a 2-night, 3-day stay in an
    inpatient facility to qualify for skilled nursing care, and various
    disincentives to providing respite or palliative care. How are your
    organizations innovating to provide care for these patients, and what
    can Congress and CMS do to support those efforts?

        Answer. The ACS would ask that Congress urge CMS to reconsider the
    rule that does not allow time spent as a hospital outpatient to count
    toward the 3-day qualifying inpatient stay for Medicare Part A coverage
    of care in a skilled nursing facility (SNF). Not only can services
    provided in the outpatient setting be similar to services provided in
    the inpatient setting, often the beds used for both sites of service
    are the same and indistinguishable to the patient and sometimes even to
    the clinicians. As such, a Medicare patient may not know whether he/she
    is admitted as an inpatient or on observation as an outpatient. In
    these situations, a patient could be surprised by a large medical bill
    when transferred to a SNF after a 3-day stay in the hospital that the
    patient thought was an inpatient stay.

        Question. Despite continued investment, electronic health records
    (EHRs) remain difficult to share, challenging for patients to access,
    and a source of frustration to providers and policymakers alike. The
    business models of the EHR venders often leads to perverse incentives
    against sharing patient information.

        What steps can Congress take to make EHRs work better for
    providers? Are the proposed data blocking rules enough to start
    encouraging better data sharing by the vendors?

        Answer. Congress has been extraordinarily supportive in the
    implementation of digital health services through EHRs and the
    subsequent efforts in 21st Century Cures regarding unleashing data.
    This move towards standards for data models and data exchange are a
    necessary first step in easing interoperability and increasing patient
    and provider access to the complete patient record.

        We believe it is time to move a layer above EHRs and begin the
    conversation about the semantically interoperable, digital information
    system as a service in an open-standard, patient cloud. Patients do not
    live in one health system or one EHR, they live in five, six, or more
    EHRs. Patient data also lives in third-party applications (Apps), in
    wearable devices, and in claims. The next generation of digital health
    services has to create the unified patient record in a patient cloud.
    The patient cloud should be an industry open standard based
    architecture that any digital system could use. A simple example of
    open industry standards are the railheads for railroads. Similarly, the
    electric grid is on one standard. The free market can then exploit
    these standards and avoid overbearing, inefficient, and costly
    duplicative services. Similarly, the United States needs an open
    standard for the architecture of a patient cloud so that any digital
    information company can apply the standard and create a semantically
    interoperable cloud. Upon these clouds, digital services like Apps can
    accelerate the role of the Internet of Things (IoT) in health care for
    all patients and clinicians.

        The EHR data models are constructs from decades past and are no
    longer going to serve as the digital architecture of tomorrow. Building
    a Linux-like architecture as an open standard cloud architecture which
    anyone can standup and use is critical to ensuring a modern
    interoperable system. This open standard cloud architecture would hold
    a patient unified record in a cloud upon which all EHRs could provide
    data, all smartphones could interact, all Application programming
    interface (API) developers could drop in their services for patients
    and clinicians. The ACS is working with cloud architects who support an
    open standards environment so that we do not repeat the mistakes we
    made with EHRs by providing perverse incentives. These efforts do not
    void the EHRs. The EHRs remain a point of data entry at a care site
    just as a smartphone or a desktop computer could also serve to enter
    data.

        In this emerging digital information system, all patient privacy
    and security rights need to remain. The care patients would receive for
    having an open source cloud architecture would take digital health
    services to a new level. Congress needs to reduce the complexity
    surrounding digital health services and expand the opportunity by
    empowering Federal agencies to work collaboratively within the
    government and with the private sector. For now, having separate
    activities which lack strategic alignment between CMS, the Office of
    the National Coordinator of Health Information Technology (ONC), the
    Centers for Disease Control and Prevention, the Agency for Healthcare
    Research and Quality, and the Food and Drug Administration create
    enough confusion. Adding in the commercial activity and the desires of
    the EHR vendors to continue their dominance and the end result will
    hinder innovation in one of the most important futures for health care.

        The ONC proposed rule as part of 21st Century Cures Act begins to
    address some of the EHR and data exchange challenges through requiring
    Fast Healthcare Interoperability Resources (FHIR) based APIs and U.S.
    Core Data for Interoperability (USCDI) data standards. We encouraged
    the ONC to work with vendors and specialty societies to define the data
    elements that are part of data exchange, and ensure that the included
    data are relevant and meaningful. This will help to avoid sending large
    amounts of irrelevant data into a new architecture. With clearly
    defined and reasonable standards, data exchange between EHRs to other
    vendors and third party applications will be manageable. We are
    concerned, however, that without incentives or an adjustment in
    reimbursement methodology, that the vendor development costs will be
    passed on to providers and health systems. Further, encouraging open
    source platforms that minimize the number of one-off connections needed
    for providers and health systems to share data with other entities and
    third party applications would ease the burden of data exchange and
    encourage innovation from health information technology (HIT) vendors.

        While many benefits come from increased interoperability, the
    challenge of patient matching is heightened as data sources increase.
    Today, there is no consistent and accurate way of linking a patient to
    their health information as they seek care across the continuum. If
    physicians cannot ensure that we have the right patient at the point of
    care, we cannot properly utilize the enormous promise of the
    portability and interoperability of health records. We continue to
    encourage a universal patient identifier to minimize this burden, and
    to work with the industry to develop algorithms in the interim that use
    demographic data points to determine patient identity.

        ACS is supportive of legislative efforts that would remove a 20-
    year mandate that prevented the U.S. Department of Health and Human
    Services (HHS) from spending Federal dollars to adopt a unique patient
    identifier. Removing the ban on unique patient identifier would help to
    ensure that surgeons have a more accurate and consistent way of linking
    patients to their health information across the continuum of care by
    providing HHS with the authority to evaluate a full range of patient
    matching solutions. It would also enable HHS to work with the private
    sector to identify a solution that is cost-effective, scalable, secure
    and one that protects patient privacy.

        Question. How can we encourage States to be better innovators on
    health-care spending? The current Medicaid waivers incentivize States
    to keep costs down, but are there ways to encourage both lower costs
    and better health-care outcomes?

        Answer. In order to identify how we can encourage States to be
    better innovators on health-care spending, Congress must understand the
    current landscape in the health insurance coverage space. States lack
    the resources to think in large scalable terms and across the landscape
    of uninsured, minimally insured, commercially insured, and those
    covered by Employee Retirement Income and Security Act of 1974 (ERISA)
    plans. The States react mostly to their budgets and the payment
    obligations, and struggle to consume a problem as complex as designing
    and transforming health care, one of the largest business sectors in
    the Nation. While we think of health care as a cottage industry which
    States should be empowered and able to manage, the long history of
    failed attempts should attest to the low level of expectations from
    States. The magnitude and complexity of the challenge leave most States
    in a quandary.

        This leaves two possibilities. First, States could await a Federal
    solution. Secondly, Congress could consider the States as testbeds for
    Federal solutions and provide States with Federal guidance containing
    well controlled swim lanes within which they can locally innovate. If
    States then wish to add-on to federally guided aspects of the business
    and payment models in health care, these additions would come at their
    individual State expense.

        Relying on States to take action on health care involves the
    commercially insured, which are mostly small businesses within a State.
    The larger corporations have been spared State regulations by providing
    health coverage under ERISA, which is regulated at the Federal level.
    Because of this, any actions taken by the States to test new ideas in
    health care are built on the backs of the small businesses that are
    unable to sustain themselves in the face of major health care redesign.
    This allows larger employers in the State to escape State-based
    regulations under ERISA plans even though larger corporations are more
    able to tolerate innovation efforts than small businesses. In order to
    increase voluntary uptake in testing new ideas in health care, Federal
    agencies overseeing ERISA plans could enact or incent innovation in
    health-care payments using rules and regulations.

                                     ______

                   Questions Submitted by Hon. Maggie Hassan
        Question. We spoke during the hearing about the incentive payment
    for providers to improve tracking and reporting of opioid prescribing,
    treatment agreements,
    follow-up evaluations, and screening of patients who may be at risk of
    opioid misuse under the Medicare Access and Children's Health Insurance
    Program (CHIP) Reauthorization Act of 2015 (MACRA).

        This data has the potential to improve treatment for substance use
    disorder, which is why its collection and reporting is now incentivized
    through increased reimbursement.

        At the hearing, I asked for feedback on the impact this data
    collection and reporting has had on treatment of patients, particularly
    as it relates to any reduction in opioid misuse.

        Based on your response, it seems that there may be additional steps
    the Centers for Medicare and Medicaid Services (CMS) could take so that
    this aggregated, de-identified data can be used to benefit patients and
    improve care.

        Do you have specific suggestions on how CMS can improve the
    collection, use, and dissemination of opioid prescribing and treatment
    data sets in ways that would directly benefit patients at their site of
    care, specifically as it relates to identifying best practices to
    reduce opioid misuse?

        Answer. The American College of Surgeons (ACS) thanks Senator
    Hassan for the opportunity to provide feedback, specifically as it
    relates to the opioid crisis and the data collection behind prescribing
    and treatment. Your question was reviewed by the ACS Opioid Taskforce
    \1\ which is dedicated to helping prevent opioid abuse and addiction in
    surgical patients. Please find the College's official statement on the
    opioid epidemic and guiding principles here: https://www.facs.org/
    about-acs/statements/100-opioid-abuse.
    ---------------------------------------------------------------------------
        \1\ https://www.facs.org/education/patient-education/safe-pain-
    control/taskforce.

        Prescribing guidelines should be evidence based and written using
    actual data. There is a concern that a 200 morphine milligram
    equivalents (MME) cutoff or 7-day limit will hurt patients, increase
    readmissions, emergency department visits, and increase costs. Detailed
    articles outlining the harm of hard limits can be found here: https://
    www.ncbi.nlm.nih.gov/pubmed/28697049 and here: https://www.
    ---------------------------------------------------------------------------
    ncbi.nlm.nih.gov/pubmed/30004924.

        ACS would encourage the Center for Medicare and Medicaid Services
    (CMS) to develop evidence-based guidelines to reduce over prescribing
    and misuse. ACS suggests referencing guidelines like the ones released
    by the Mayo Clinic: https://advancingthescience.mayo.edu/2018/04/16/
    new-mayo-guidelines-cut-some-opioid-prescriptions-by-half/ (Study
    attached).

        More generally, data collection should be mobile and easily
    accessible at the point of care. Data collection should be focused at
    the population level. Narcan for example, is distributed by police,
    fire, emergency medical technicians (EMTs), physicians and the patients
    themselves. This community data should be shared with the databases of
    physician offices, hospitals and clinics. In order to fully understand
    the scope of the epidemic data should be as granular as possible.

        Furthermore, ACS supports the use of fully-functioning prescription
    drug monitoring programs (PDMPs) as a health-care and research tool to
    assist physicians and other prescribers. Currently, there is wide
    variability between the functionality and accuracy of PDMPs from State
    to State. ACS strongly supports the utilization of governmental grant
    funding to enhance these programs and make them accessible to
    appropriate members of the health-care team. ACS also believes PDMPs
    should integrate into a clinician's natural workflow.

        Patient education is also a key component to reducing opioid
    misuse. The ACS has developed and discriminates a wide variety of tools
    for physicians to use in order to education and inform their patients:
    https://www.facs.org/education/opioids/patient-ed. Public awareness
    campaigns such as ``Change the Script''\2\ led by the State of
    Connecticut connects ``town leaders, health-care professionals,
    treatment professionals and everyday people with the resources they
    need to face prescription opioid misuse.''
    ---------------------------------------------------------------------------
        \2\ https://portal.ct.gov/DMHAS/Prevention-Unit/Prevention-Files/
    Change-the-Script.

        The ACS is committed to addressing the societal imperative to avoid
    the overprescribing of opioids through both patient and provider
    education, as well as through continued research into non-opioid pain
    treatments and other alternative remedies. We stand ready as a resource
    to Senator Hassan and the members of the Health, Education, Labor and
    ---------------------------------------------------------------------------
    Pensions (HELP) Committee as discussions continue on this topic.

    [GRAPHIC] [TIFF OMITTED] T5819.006

    [GRAPHIC] [TIFF OMITTED] T5819.007

                                     ______

                     Prepared Statement of Hon. Ron Wyden,
                           a U.S. Senator From Oregon
        Four years ago, this committee led the effort to revolutionize the
    way doctors are paid under Medicare. Into the dustbin of history went
    the out-of-date system known as the sustainable growth rate--a system
    that had inflicted more than a decade of uncertainty on doctors and
    seniors.

        The new system that replaced it engraved a basic principle in
    stone: Medicare is going to reward the quality of care rather than the
    quantity of care. That's the direction that health care is headed in
    across the country, and Medicare ought to lead the way.

        That new system established by the bipartisan MACRA law has now
    been in place for 2 years, and this committee has kept a close eye on
    its implementation. So today, the committee will hear from the doctors
    who operate under this system about what's working and what's not.
    There are a few key issues to focus on this morning.

        First, all doctors should have a meaningful opportunity to succeed
    under the new payment system--including those in small practices and in
    rural and underserved areas. Oftentimes those rural physicians are the
    backbone of their communities, and they're relied on for a broad range
    of care. It's absolutely essential, as there's a greater focus on
    rewarding value in health care, that doctors in small and rural
    practices aren't left behind. Otherwise that'll degrade the care rural
    patients get, and it'll cause an even bigger health-care gap between
    big cities and small towns.

        Second, when it comes to assessing quality, the goal of
    implementing this new system is not to have doctors checking boxes all
    day long. Our system needs to measure and reward the care that is most
    impactful for patients' health. When you're all about rewarding value,
    that's what matters.

        Third, the system needs to continue wringing more value out of
    taxpayer dollars in Medicare while coordinating the care seniors need.
    You can do that, for example, by encouraging more doctors to provide
    care through Accountable Care Organizations, medical homes, and bundled
    payments.

        One final point on the topic of physician payments as I wrap up.
    Last year the Congress passed a historic Medicare bill, the CHRONIC
    Care Act. It marked a major shift for Medicare away from being an acute
    care program treating broken ankles and bouts of the flu. It recognized
    that modern medicine for seniors in America is about treating cancer,
    diabetes, Alzheimer's, and other chronic illnesses. After that
    progress, it's time to think about what's next.

        In my view, the next step ought to be helping to guide the
    countless seniors who get lost in the blizzard of modern health care.
    Forms and prescriptions and instructions and pill bottles--it can be
    too much and too complicated for any one person to manage on their own.

        As a former basketball player, I put the solution in basketball
    terms. Every senior with chronic illness ought to have what I call a
    chronic care point guard managing their care and making sure their
    doctors work together. To extend the metaphor, it's about having
    somebody out there running the floor. The truth is, regardless of
    whether an older person is enrolled in traditional Medicare or a
    Medicare Advantage plan, that kind of assistance could help improve
    care and avoid a lot of mistakes.

        As for today, I want to hear from those on the ground about how the
    new physician payment system is working and what can be done to improve
    it. I want to thank all of our witnesses for joining us today, and I
    look forward to questions.

                                     ______

                                 Communications

                                  ----------

                         Alliance of Specialty Medicine

                             3823 Fordham Road, NW

                              Washington, DC 20016

        The Alliance of Specialty Medicine (``Alliance'') is a coalition of
    fifteen 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. As
    patient and physician advocates, the Alliance welcomes the opportunity
    to provide input in the formulation of healthcare and Medicare policy.
    This hearing is an important step toward continuing the promise of the
    Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and
    associated programs established under the Centers for Medicare and
    Medicaid Services' (CMS) Quality Payment Program (QPP)--the Merit-based
    Incentive Payment System (MIPS) and Advanced Alternative Payment Models
    (A-APMs)--as it was intended by the Congress.

        The Alliance of Specialty Medicine believes:
              Congress should continue to make adjustments to the programs
            created under MACRA;
              Congress should maintain a viable fee-for-service option for
            providers under the Medicare program;
              Congress must safeguard beneficiaries' access to care by
            eliminating the 0% payment update applied to the Medicare
            conversion factor from 2020-2025 and replacing it with an
            update factor that better recognizes the Medicare Physician Fee
            Schedule conversion factor has failed to keep with inflation
            and in some instances has been reduced.
              Congress should acknowledge the slow pace of implementation
            of APMs by altering the timelines for bonuses embedded in
            statute. This includes:
                  Extending the availability of the Advanced
            APM 5% Incentive Payment in acknowledgement of the snail's pace
            of APM implementation by Medicare; and
                  Re-evaluating the qualifying participation
            thresholds for the A-APM incentive payment in light of the lack
            of implementation by CMS of qualifying APMs.

    Background on Physician Engagement in MACRA

        We first would like to take the opportunity to again commend
    Congress for enacting MACRA. This important step removed the constant
    threat brought to Medicare payments by the Sustainable Growth Rate
    (SGR). With the SGR, a destabilizing force for Medicare beneficiaries
    and the system overall, out of the way, Congress has provided the
    opportunity for all stakeholders to engage in a more meaningful
    discussion about how best to update Medicare payments and recognize the
    value of services that are provided by physicians, including
    specialists. We would also like to thank Congress for ``technical
    corrections'' included as part of the Balanced Budget Act of 2018,
    which significantly improved the ability of physicians--namely
    specialists--in their ability to participate in MACRA programs, and
    especially MIPS.

        Through MACRA, Congress sought to provide flexible options for
    clinicians to meaningfully engage in quality improvement and value-
    based payment under Medicare. Members of this committee heard our
    concerns about legacy quality improvement programs in Medicare--the
    Physician Quality Reporting System (PQRS), Physician Value-Based
    Payment Modifier (VM) and the Medicare and Medicaid Electronic Health
    Record Incentive Program, or ``Meaningful Use''--and in response sought
    to remove disparate reporting requirements, overlapping measures, and
    most of the ``all-or-nothing'' aspects of these programs and to create
    a streamlined system that allows physicians to focus on the measures
    and activities that most closely align with their practices. As a key
    example of that, Congress included clinical practice improvement
    activities under MIPS, giving physicians MIPS credit under Medicare's
    payment methodology for activities designed to improve care--further
    encouraging physicians' ongoing engagement in quality improvement
    activities. More importantly, Congressional leaders understood that a
    viable fee-for-service option was essential to the Medicare program for
    those physicians, including many specialty and subspecialty providers
    that may never find a place in alternative payment and delivery models.
    While MIPS serves as an ``on-ramp'' for many clinicians, it serves as
    the ongoing value-based payment system for clinicians who must remain
    in a fee-for-service reimbursement construct. Under MIPS, specialists
    and subspecialists have a fair opportunity to remain in fee-for-service
    while continuing to measure, report, and improve performance on key
    areas of clinical quality that matter to their practice and their
    patients.

        The Alliance recognizes that MIPS has challenges, although the
    first year of the program showed significant participation by
    physicians. According to CMS' 2017 Quality Payment Program Experience
    Report, 95 percent of eligible clinicians participated in MIPS (54
    percent as groups, 12 percent as individuals, and 34 percent through
    MIPS APMs), exceeding the agency's goal of having 90 percent of MIPS
    eligible clinicians participate during the first performance year. This
    success can be attributed to CMS' efforts to ease clinicians into the
    program through a transition, which began with a ``Pick Your Pace''
    engagement strategy and determined efforts by medical professional
    societies to educate physicians on successful participation. For those
    who participated, 93 percent earned a positive payment adjustment and 2
    percent got a neutral adjustment. Of note, the majority of clinicians
    across all payment categories chose to report data for 90 days or
    longer.

        Despite calls by the Alliance and other medical and healthcare
    professional organizations, a detailed breakdown of QPP performance by
    physician specialty is not available nor reporting option utilization
    rates by physician specialty. We contend that such data should be
    routinely included as part of CMS' regulatory impact analyses included
    in annual rulemaking for the QPP. In order for medical healthcare
    profession associations to better educate and motivate members, it is
    also important for CMS to begin sharing payment adjustment data by
    physician specialty.

        With respect to A-APMs, engagement is more challenging,
    particularly for specialists. First, CMS has implemented so few APMs
    since the passage of MACRA that meaningful opportunities to participate
    in APMs for most specialists does not exist. MACRA contemplated an
    expansion of available models with the creation of the Physician
    Focused Payment Model Technical Advisory Committee (PTAC). While CMS
    recently announced the Primary Care First model, a single model largely
    focused on primary care that incorporates a few elements from several
    different models recommended for limited-scale testing by PTAC, CMS has
    otherwise failed to implement models recommended by the PTAC that have
    addressed a broad range of physician specialties.

        Existing A-APMs, such as qualifying Medicare Accountable Care
    Organizations (ACOs), do not fairly measure or account for the quality
    and costs of specialty medical care. For example, the measure sets used
    by current ACO models focus on measures reported by primary care
    providers rather than specialty care providers, making it difficult for
    specialists to meaningfully engage. Without measures of specialty care,
    ACOs seem to struggle with specialist engagement. Perhaps more
    concerning, and similar to health insurers, Medicare ACOs have
    seemingly adopted ``narrow networks'' as a strategy to control costs,
    severely limiting the participation of specialists. Other models that
    have been identified as Advanced APMs, such as medical home models like
    Comprehensive Primary Care Plus (CPC+), are also difficult for
    specialty care physicians to engage in, as these models are designed
    for primary care physicians. CMS recently announced its Primary Cares
    Initiative, which again, will be largely limited to primary care
    providers.

        While a few models focus on specialty medical conditions and engage
    specialty physicians, these only cover a paucity of physician specialty
    domains. The MACRA vision of moving clinicians from fee-for-service
    into alternative payment models can only materialize if those models
    are actually implemented by CMS for potential participation. This
    currently leaves MIPS as the only track of the QPP for most specialists
    to meaningfully engage in MACRA's reforms. More importantly, some
    specialists may never find an appropriate A-APM given their specialty
    or practice size. To that end, MIPS must be enhanced for long-term
    viability and the timelines contemplated under the original passage of
    MACRA must be re-evaluated to account for the fact that so few APMs are
    available and in recognition of the fact that many physicians, and
    specialists in particular, will continue to have payment updates based
    on MIPS because of this and because current APMs are not designed to
    account for the type of care provided by certain specialists.

    MACRA and Specialists: Considerations for the Future

        The Alliance appreciates the Congress' and CMS' efforts to improve
    the QPP and reduce the burden of participation, as well as minimize the
    number of clinicians subject to negative payment adjustments.
    Nevertheless, specialty physicians continue to face unique challenges
    as they attempt to engage. For example, CMS' ``Meaningful Measures''
    initiative, which is aimed at reducing the number of measures in its
    quality programs, has limited the ability of specialists to
    meaningfully participate in MIPS as relevant measures have been
    eliminated. Specialty societies have made considerable investments in
    specialty-specific measure development, only to find CMS implementing
    an overly aggressive policy to eliminate what it deems are ``topped
    out'' measures. We believe that while it might be appropriate to place
    less of a priority on these measures from a MIPS scoring stand point,
    the current policy eliminates these measures when there is still
    measurement value, and the aggressive timeframe leaves societies with
    inadequate time to develop new quality measures to ensure that every
    specialty has a MIPS quality score based on measures meaningful to that
    specialty. Contrary to CMS' efforts to reduce administrative burden,
    this policy actually increases the burden of MIPS on those specialties
    that no longer have relevant measures in the program.

        The Alliance and its member organizations continue to work with the
    agency to improve MIPS and the availability of A-APMs. To that end, the
    Alliance makes the following recommendations to Congress, many of which
    have been previously shared with CMS:
    MIPS
              Eliminate the 0% payment update applied to the Medicare
            conversion factor from 2020-2025 and replace with positive
            annual updates that recognize the Medicare Physician Fee
            Schedule conversion factor has in the past failed to keep up
            with inflation and in some instances has even been reduced,
            provides reimbursements that keep up with the escalating costs
            of providing care, and supports practice efforts to invest in
            models of care and reimbursement based on value;
              Provide participation data in MIPS, by specialty, as part of
            the annual notice and comment rulemaking for the QPP;
              Remove the ``all-or-nothing'' aspect of the Promoting
            Interoperability (Pl) category by allowing eligible clinicians
            to select from a menu of measures that are most appropriate for
            their practice and patient population and gives full credit for
            this category for those practices that participate in a
            qualified clinical data registry (QCDR); and
              Simplify MIPS scoring so eligible clinicians and practice
            staff can have a more accurate understanding of how success can
            be achieved given various levels of participation.
    A-APMs
              Provide participation data in A-APMs, by specialty, as part
            of the annual notice and comment rulemaking for the QPP;
              Extend the availability of the A-APM incentive payment
            (i.e., the 5% APM incentive payment) beyond the 2024 payment
            year/2022 performance year;
              Re-evaluate the qualifying participation thresholds for the
            A-APM incentive payment in light of the lack of implementation
            by CMS of qualifying APMs;
              Provide CMS with directives on implementation of physician-
            focused payment models (PFPMs) and, in particular, specialty-
            developed PFPMs; and
              For Medicare's ACO program:
                  Establish pathways for specialists to
            meaningfully engage in the ACO program;
                  Provide ACOs with technical assistance that
            would allow them to appropriately analyze clinical and
            administrative data, improving their understanding of the role
            specialists could play in addressing complex health conditions,
            such as preventing acute exacerbations of comorbid conditions
            associated with chronic disease;
                  Establish requirements that prohibit ACOs
            from restricting specialist participation;
                  Closely examine the referral patterns of ACOs
            and establish benchmarks that will foster an appropriate level
            of access to and care coordination with specialists, in
            addition to collecting feedback from beneficiaries on access to
            specialty care;
                  Develop an ACO quality measure that would
            capture the percentage of physicians reporting to specialty-
            focused clinical data registries; and
                  Adopt specialty designations for non-
            physician practitioners to ensure specialty practices are not
            inadvertently forced into exclusivity.

    MedPAC Recommendation to Eliminate MIPS

        In 2018, the Medicare Payment Advisory Commission (MedPAC)
    recommended the elimination of MIPS based on its conclusion that the
    basic design of MIPS is fundamentally flawed. The Commission contends
    that MIPS will not succeed in helping beneficiaries choose clinicians,
    in helping clinicians change practice patterns to improve value, or in
    helping the Medicare program reward clinicians based on the value of
    the care they provide. To address these concerns, Med PAC further
    recommended implementing a voluntary value program (VVP) that would
    measure large groups of physicians on population, outcome, and patient
    experience measures. Details about the VVP are anticipated in future
    Commission work; however, the concept at its broadest level ensures
    that most specialists will be unable to meaningfully engage as the
    measures MedPAC has suggested are those CMS uses in its other quality
    programs and focus on primary care activities and population health.

        The Alliance strongly opposes MedPAC's recommendations for the
    reasons cited below:

              There is a significant lack of A-APMs in which specialists
            can meaningfully engage;
              The measures contemplated for use under a VVP will be
            limited in their ability to determine quality and cost of
            specialty medical care;
              Specialty providers have very little control over the
            activities that affect performance on the measures contemplated
            for use under a VVP; and
              MACRA very clearly intended to promote the development of
            clinically relevant, specialty-based quality measures. MIPS,
            and fee-for-service, remain a viable reimbursement structure
            for many specialists and subspecialists and must be maintained.

        Instead of the MedPAC recommendation to scrap the progress that has
    been made thus far on the implementation of MACRA, in addition to the
    provisions suggested above, we believe the following steps, many of
    which can be taken by CMS, will help make the QPP a better system on
    which to base physician payment updates than what is suggested by
    MedPAC under the VVP:

              Streamline the program to avoid the siloed scoring of the
            current four performance categories;
              Condense the amount of time between performance and payment
            years in order to provide more meaningful feedback and
            incentives;
              Reduce the reporting periods to an amount of time that
            provides reliable data but reduces the administrative reporting
            burden placed on practices; and
              Promote the inclusion of measures that recognize the value
            of specialty care rather than broad primary care-focused
            measures that only apply to a subset of services provided in
            the context of the Medicare Physician Fee Schedule.

    Conclusion

        Specialists are an essential and needed component of the healthcare
    system. Specialists use their deep knowledge and expertise to reach a
    precise medical diagnosis, present the full array of available
    interventions, collaborate closely with their patients to determine
    which treatment options are most appropriate based on their preferences
    and values, and coordinate and manage patients' specialty and related
    care until treatment is complete. No other clinician, provider or
    health care professional can replace the value offered by specialty
    physicians. At the same time, specialty physicians have had limited
    opportunity to engage in value-based transformation through available
    A-APMs that are targeted to their specialties, and the likelihood of
    widespread future models tailored to their expertise remain low. To
    that end, MIPS must continue to be improved for long-term viability
    since it will be the only option for many of these specialists to
    engage in value-based payment given they will have no other option than
    to remain in fee-for-service.

        Finally, while we are confident that successful implementation of
    the idea cited above will make strides in developing a more meaningful
    QPP for patients, physicians, and for Medicare as a payer, we also
    believe that it will be important to begin having a larger conversation
    about the siloed payment systems in Medicare that fail to recognize the
    impact that specialists have on inpatient and outpatient hospital
    spending. Physicians have been asked to bear the brunt of Medicare
    spending increases with payments that are sometimes cut, certainly fail
    to keep pace with inflation, and fail to even measure up to the payment
    increases included in MACRA. For instance, in 2016, the first year that
    the MACRA 0.5% base payment update was implemented, the Medicare
    Physician Fee Schedule conversion factor actually decreased by -0.34%
    going from $35.9335 in 2015 down to $35.8043 in 2016. In no subsequent
    year did the actual conversion factor increase match the 0.5%
    contemplated in statute, and 5 years later we stand at a Medicare
    Physician Fee Schedule conversion factor of $36.0391, only nominally
    above the 2015 conversion factor. During this time, hospitals continue
    to get significant across-the-board Medicare payment increases based on
    an inflationary update in addition to their value-based purchasing
    program updates. CMS has proposed a general fiscal year (FY) 2020
    payment increase for inpatient hospitals of 2.7%. The inequity between
    these payment systems will continue to exacerbate issues in our health
    care delivery system, undermine the value of the services physicians
    provide to their patients while throwing money at brick-and-mortar
    investments, and fail to recognize that patients are best supported
    when the payment systems reflect the actual care delivery system.

        The Alliance of Specialty Medicine is committed to the successful
    and timely implementation of the law while still providing
    practitioners time and opportunities to succeed. We look forward to
    working with the committee to ensure MACRA continues to be successful,
    and we would be happy to discuss any other questions you may have going
    forward.

                                     ______

                       American Academy of Ophthalmology

                           20 F Street, NW, Suite 400

                           Washington, DC 20001-6701

                               T: +1 202-737-6662

                              https://www.aao.org/

    Thank you for holding an important oversight hearing on implementation
    of the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015.
    The American Academy of Ophthalmology appreciates the opportunity to
    submit a statement for the record. As the world's largest association
    of eye physicians and surgeons, the Academy seeks to protect sight and
    empower lives by setting the standards for ophthalmic education and
    advocating for our patients and the public.

    The Academy, along with most of the healthcare community, supported
    MACRA and the repeal of the Sustainable Growth Rate formula. Moving to
    a new payment system that works to reward quality patient care, improve
    outcomes, and ensure cost effectiveness in the Medicare program is
    important to the Academy. While a small specialty, the fact that the
    majority of ophthalmology's patients are Medicare beneficiaries makes
    us vital to the new Medicare physician payment program.

    The best way to achieve MACRA's aims is with continuous quality
    improvement; this is the driving force for our implementation of the
    Academy's IRIS' Registry (Intelligent Research in Sight)--
    the nation's first comprehensive eye disease clinical registry.

    CMS's slow ramp up (Pick your Pace) allowed practitioners and their
    specialty organizations needed time to prepare to meet the requirements
    of the new Quality Payment Program (QPP). Because of this necessary
    ramp up, there is naturally a delay in seeing evidence of significant
    improvement for beneficiaries and patient outcomes.

    The IRIS Registry:

    Just 5 years since its launch, IRIS Registry is the world's largest
    single specialty clinical data registry. Today, nearly 18,000
    physicians are contracted with the IRIS Registry, and nearly 15,000 of
    these physicians are integrated with IRIS Registry through their
    electronic health record (EHR). This integration allows seamless
    transmission of quality data points from the patient records into the
    registry each night, easing the reporting burden for clinicians. This
    works to level the playing field, facilitating participation of small
    and rural practices in MIPS. More than 70 percent of U.S. actively
    practicing ophthalmologists participate in the IRIS Registry. This high
    participation rate is bolstered by two factors:

          The high percentage of our ophthalmologists that must
    participate in MIPS; and
          Actionable information provided in a timely fashion that allows
    our members to implement effective quality improvement measures of
    direct benefit to patients independent of the QPP.

    More than 20 other specialties have initiated similar EHR integrated
    clinical data registries that, like IRIS Registry, have been recognized
    as a qualified clinical data registry (QCDR) under MIPS. The Academy
    made the major commitment to develop a clinical data registry to
    advance true improvement in quality of care and patient outcomes,
    devoting significant resources and investing more than $13 million.
    Participation is free for member ophthalmologists which has helped
    foster a collaborative and inclusive program. The Academy is committed
    to making MIPS work for Medicare and ophthalmology because there is
    little opportunity on the horizon for non-hospital-based specialties to
    participate in and achieve status as Advanced Alternative Payment
    Models (AAPMs).

    For 2019 MIPS, CMS approved 28 QCDR measures for the IRIS Registry
    developed by the Academy with our subspecialties. The vast majority of
    these measures are outcome measures. Our goal is to provide at least
    two outcome measures of quality that effectively represent relevant
    performance and outcomes for each of ophthalmology's nine
    subspecialties.

    Areas for Improvement Under MIPS:

    Low Volume Threshold--MIPS has not been without controversy. Under the
    significant low volume exclusion threshold established by CMS, two-
    thirds of practitioners are not required to participate in the QPP.
    This appears to be contrary to Congress' commitment to value-based care
    under Medicare. Ophthalmology, and a few other specialties, have the
    highest percentage of clinicians required to participate in MIPS. This
    means that our members are at a higher risk for significant penalties
    under MIPS/MACRA than other specialties, and we do not believe that
    Congress intended this risk inequity when the law was enacted. In
    addition, the limited participation overall in the QPP hampers the
    health system transformation that Congress envisioned from MACRA.

    Web Interface Reporting Option--The low-volume threshold is not the
    only policy in CMS's QPP that introduces inequities among MIPS
    participants. For example, the web interface reporting option is only
    an option for very large practices. Under this reporting option, very
    large groups report on 10 primary/general care measures for a subset of
    248 patients. No specialty outcome measures are included. Therefore,
    specialty care in these groups essentially goes unevaluated, leaving
    CMS and patients with no insight into the quality of care provided by
    the large volume of specialty practitioners in these very large groups.
    In stark contrast, physicians who do not practice in these very large
    groups are held individually accountable for outcomes pertinent to
    their specialty. This introduces a bias where a higher bar is set for
    physicians in smaller practices. In other words, this is a double-edge
    sword. The CMS Web Interface reporting policies result in the
    following: (1) a higher reporting burden on small practices than on the
    very large practices; (2) limit the potential quality care improvement
    in very large practices; and (3) reduce the public's ability to select
    specialists on the basis of quality metrics.

    Healthcare Consolidation--Furthermore, the Web Interface reporting
    option for very large groups may incentivize a trend in healthcare that
    both HHS and Congress have been trying to stem--consolidation.
    Consolidation has been shown to contribute to increased healthcare
    costs.

    Small Practices--In addition to the large practice bias introduced by
    the Web Interface reporting policies, a recent article in Health
    Affairs highlighted the challenges small practices face complying with
    QPP/MIPS. Specifically, small and rural practices had significantly
    lower MIPS scores. We recommend that CMS reinstate the small practice 5
    percent differential/bonus on the total score. In addition, score
    improvements for small practices continue to be needed in the Quality
    Component and current differentials should be retained.

    Expanding QCDR Credit--In the MACRA legislation, Congress foresaw the
    difficulty in creating germane and more dynamic measurements of quality
    performance among specialists and specifically instructed CMS to
    incentivize the use of QCDRs. However, CMS has indicated its intention
    to remove these even limited or small incentives altogether. Recently,
    the Brookings Institute raised concern about the outlook for MIPS but
    called for a standalone bonus/recognition for clinical data registries
    that are clearly improving care. To help achieve the goals of the law
    and improve quality of care, patient outcomes and costs, CMS should
    follow congressional intent and increase its credit for practitioners
    that participate in proven quality improvement initiatives such as
    certain clinical data registries.

    Ways that Medicare is benefiting from incentivizing QCDRs/Clinical Data
    Registries:

    Quality Improvement--Registries have been demonstrated to improve
    quality of care and outcomes. A study published in Ophthalmology
    documented improvement on quality measure performance as a result of
    the feedback provided by the IRIS Registry.\1\ This includes
    improvements in lowering high risk medications for the elderly, and
    improvement in lowering the complications after cataract surgery. While
    one of the most successful procedures, cataract is also one of the most
    frequently performed procedures under Medicare. Even a small reduction
    in cataract complications has a substantial impact for Medicare.
    ---------------------------------------------------------------------------
        \1\ Rich WL 3rd, Chiang MF, Lum F et al. ``Performance Rates
    Measured in the American Academy of Ophthalmology IRIS Registry
    (Intelligent Research in Sight).'' Ophthalmology. 2018; 125:782-4.

    Value Improvements--At a time when there was much public concern about
    the risks of compounded pharmaceuticals, IRIS Registry data has been
    used to show that there is no statistical difference in the rates of
    endophthalmitis in age-related macular degeneration (AMD) patients by
    anti-vascular endothelial growth factor (VEGF) agent, helping to
    preserve practitioner and beneficiary confidence in repackaged, off-
    label treatments for AMD and diabetic retinopathy. Studies using
    registry data could bring significant cost savings to Medicare. For
    example, preserving the option to use Bevacizumab for AMD treatment is
    estimated to save the Medicare program and patients in the billions.\2\
    ---------------------------------------------------------------------------
        \2\ Rosenfeld PJ, Windsor MA, Feuer WG et al. ``Estimating Medicare
    and Patient Savings From the Use of Bevacizumab for the Treatment of
    Exudative Age-related Macular Degeneration.'' Am J Ophthalmology 2018;
    191:135-139.

    Real World Evidence--The IRIS Registry has also helped to demonstrate
    the safety of commonly performed procedures. One study showed that in
    real-world usage, anti-VEGF intravitreal injections are associated with
    a small decrease in intraocular pressure, and not an increase in
    intraocular pressure.\3\ Another study demonstrated that cataract
    surgery is associated with a very low rate of endophthalmitis, a
    vision-threatening complication, at 0.08%.\4\
    ---------------------------------------------------------------------------
        \3\ Atchison E, Wood K et al. ``The Real World Effect of
    Intravitreous Anti-VEGF Drugs on IOP: An Analysis Using the IRIS
    Registry.'' Ophthalmology, 2018; 125:676-82.
        \4\ Coleman AL. ``How Big Data Informs Us About Cataract Surgery:
    The LXXII Edward Jackson Memorial Lecture.'' Am J Ophthalmology 2015;
    160:1091-1103.
    ---------------------------------------------------------------------------

    Conclusion:

    The Academy applauds the Committee for conducting its oversight hearing
    on the implementation of the Medicare Access and CHIP Reauthorization
    Act. As implementation of the law continues, we look forward to working
    with the Committee to improve both the QPP and MIPS to ensure that
    participating physicians have opportunities to succeed and the push for
    a quality-driven healthcare system continues.

    When Congress enacted the MACRA, it created the QPP to streamline
    Medicare's existing quality improvement programs and reduce the
    regulatory and administrative burdens on physicians. Congress
    envisioned QCDRs like the Academy's IRIS Registry to be a meaningful
    solution to achieving the QPP's goals and directed the HHS Secretary to
    encourage clinical data registries in the law's implementation.

    Therefore, Academy recommend that Congress reiterate its support for
    specialty-led clinical data registries and strongly encourage CMS to
    increase credit under the QPP/MIPS to eligible practitioners who
    voluntarily participate in registries. For example, a highly valuable
    move and important step would be to create a pathway through which EHR-
    integrated registry participants could fully qualify for the Promoting
    Interoperability (PI) category of MIPS. PI is the most onerous category
    of the MIPS program, and a registry pathway would significantly reduce
    practitioner burdens and improve participation in specialty-led
    registries.
                   disclosure of federal grants or contracts
    Between 2013 and 2015, the American Academy of Ophthalmology (AAO)
    received funding from the Agency for Healthcare Research and Quality
    (AHRQ) under the Developing Evidence to Inform Decisions about
    Effectiveness (DEcIDE) Program, to disseminate the Registry for
    Glaucoma Outcomes Research (RiGOR) study findings through the use of
    social media tools.

    The American Academy of Ophthalmology is a 501c(6) educational
    membership association.

                                     ______

                  American Association of Orthopaedic Surgeons

                    317 Massachusetts Avenue, NE, Suite 100

                           Washington, DC 20002-5701

                               PHONE 202-546-4430

                                www.aaos.org/dc

    May 7, 2019

    The Honorable Chuck Grassley        The Honorable Ron Wyden
    U.S. Senate                         U.S. Senate
    135 Hart Senate Office Building     221 Dirksen Senate Office Building
    Washington, DC 20510                Washington, DC 20510

    Dear Chairman Grassley and Ranking Member Wyden,

    On behalf of the American Association of Orthopaedic Surgeons (AAOS),
    we would like to express our appreciation for holding a hearing on
    Medicare physician payment reform and the Medicare and CHIP
    Reauthorization Act (MACRA). This is a high priority issue for our
    members, and we have closely been monitoring MACRA's progress and
    effects on the AAOS membership. AAOS represents over 34,000 orthopaedic
    surgeons and residents, as well as musculoskeletal patients nationwide.

    The AAOS commends Congress on its efforts to improve access to high
    quality, high value health care. We hope the opportunity to provide
    input on MACRA, as well as other proposals and policies impacting
    physician quality measurement and reporting practices, will shape the
    continued development and improvement of these programs. We have
    provided our comments below.

    MACRA Implementation and Progress

    We are pleased that the Center's for Medicare and Medicaid Services
    (CMS) agreed to our request for a gradual buildup of penalties starting
    in 2018. With the implementation of MACRA under CMS' Quality Payment
    Program (QPP), as well as numerous other regulatory changes, physicians
    are navigating a complex new reporting system. Indeed, many are still
    working to understand the new requirements and prepare necessary
    infrastructure and education.Congress should continue to make program
    reforms that allow physicians to adequately prepare for the
    increasingly complex and ever-changing regulatory environment.

    Additionally, AAOS encourages removal of the requirement to report on
    all patients going forward. It is widely known that orthopaedic
    medicine lacks validated patient reported outcome-based performance
    measures (PRO-PM) and has few process measures. AAOS suggests that in
    areas where there are no validated clinical-level quality measures, and
    until the time these are developed, physicians be allowed to
    participate in the Merit-based Incentive Payment System (MIPS)
    voluntarily.

    For payment year 2019, for an eligible clinician to become a qualifying
    participant they must receive 50 percent of their Medicare part B
    payments or see at least 35 percent of Medicare patients through an
    Advanced APM entity to receive the 5 percent Advanced APM bonus. These
    thresholds are almost impossible even for our high-volume surgeons who
    participate in BPCI Advanced. AAOS urges Congress to provide reasonable
    thresholds so that surgical clinicians can adequately participate and
    become a qualifying program participant.

    Clinical Data Registry Participation and Incentives

    AAOS has invested significantly in our family of clinical data registry
    programs, including quality collection measurement functionality and
    components. Within orthopaedics, a growing number of AAOS members
    participate in these registries such as the American Joint Replacement
    Registry (AJRR), which collects data that would be useful in quality
    reporting. Many other medical and specialty societies operate
    registries of various scopes and sizes, and the vast majority of these
    registries contain relevant data on quality. Other entities operating
    registries include integrated health care systems (e.g., Kaiser,
    Geisinger), Accountable Care Organizations, and Independent Physician
    Associations.

    If registries or other existing quality reporting programs report to
    CMS, a common set of variables should be required across all reporting
    entities. The list of required common variables should be developed in
    collaboration with medical specialty societies. Additionally, data must
    be appropriately risk-adjusted for each physician's particular case
    mix, including co-morbid conditions, to facilitate meaningful and
    relevant comparisons among physicians. Lastly, physicians should have
    the opportunity to request audits of their quality data and have due
    process to address any errors.

    Quality reporting systems also need to become more user-friendly and
    more tailored to specific specialties, particularly surgical
    specialties. Significant progress needs to be made in developing valid,
    relevant, patient-centered measures of physicians' quality of care.
    These measures should be expanded to include patient outcomes, patient
    safety measures, and experience of care.

    There is also not currently a path for registries to participate as an
    Alternative Payment Model (APM). AAOS strongly advocates for the
    opportunity to allow physicians to qualify for payment updates under
    MACRA for participation in a qualified clinical data registry (QCDR).

    Alternative Payment Models (APMs)

    We strongly urge Congress to discourage the mandatory nature of the
    proposals coming out of CMS and instead create incentives for
    interested participants that would reward innovation and high-quality
    patient care. We believe the programs should be voluntary for any set
    of surgeons, facilities, and providers who seek to collaborate in
    innovative ways to bring higher quality, coordinated, and lower costs
    for musculoskeletal care and who have the infrastructure necessary to
    carry out an episode of care approach to payment and delivery.
    Specifically, we recommend that CMS require that any participating
    entity have verifiable interoperability, infrastructure, and agreements
    between all necessary entities.

    Conclusion

    The AAOS has committed considerable member and financial resources to
    developing and analyzing evidence-based process and outcome measures
    and encouraging the adoption of evidence-based practice guidelines for
    the prevention, diagnosis, and management of musculoskeletal diseases.
    We invite CMS to call on us as an involved partner and subject matter
    expert in evidence-based performance and quality measurement in
    musculoskeletal care.

    We look forward to working with you and other stakeholders to ensure
    the continued success of MACRA and other related physician payment
    programs. Please feel free to contact Madeline Kroll, Manager of
    Government Relations (kroll@aaos.org), if you have any questions or if
    the AAOS can further serve as a resource to you.

    Sincerely,

    Wilford Gibson, MD
    Council on Advocacy Chair, American Association of Orthopaedic Surgeons

                                     ______

                         American College of Physicians

                     25 Massachusetts Avenue, NW, Suite 700

                           Washington, DC 20001-7401

                                  202-261-4500

                                  800-338-2746

                               www.acponline.org

    The American College of Physicians (ACP) appreciates the opportunity to
    share our views regarding Medicare physician payment reform under
    MACRA, the implementation of this law after two years, and the road
    ahead for physicians to ensure a health care delivery system that
    rewards the value and quality of care provided to patients. We thank
    Senate Finance Chairman Grassley and Ranking Member Wyden for hosting
    this hearing to hear the view of physicians concerning MACRA in order
    to ensure that it is implemented successfully and as intended by
    Congress. As Congress considers oversight or potential legislative
    changes to MACRA, we urge you to take steps to improve Medicare payment
    policies in ways that better align payments with the value of care
    provided to patients, reduce unnecessary administrative burdens that
    divert physicians away from patient care, ensure that performance
    measures used for payment or public accountability are evidence-based,
    clinically relevant, and appropriate, and create more opportunities for
    physicians to lead and participate in alternative payment models.

    ACP is the largest medical specialty organization and the second
    largest physician group in the United States. ACP members include
    154,000 internal medicine physicians (internists), related
    subspecialists, and medical students. Internal medicine physicians are
    specialists who apply scientific knowledge and clinical expertise to
    the diagnosis, treatment, and compassionate care of adults across the
    spectrum from health to complex illness.

    Overview of the First Two Years of MACRA

    In order to provide an accurate assessment of whether the new payment
    systems under MACRA have provided adequate support and reimbursement
    for physicians to continue to provide high quality value-based care for
    their patients, it is essential to examine how physicians fared during
    the first two years of MACRA implementation. ACP has examined the
    results of the Quality Payment Program (QPP) Experience Report based on
    the 2017 participation rate in Merit-based Incentive Payment System
    (MIPS) and Advanced Alternative Payment Models (APMs). There are
    several positive results from this survey that acknowledge in some
    degree that MACRA is working as it intended. The 2017 results show that
    the participation rate of physicians in MACRA was 95 percent and that
    only five percent of the physicians received a penalty. However, the
    bar for entry into MACRA was set very low, by design, to ensure that in
    the first year physicians could adequately transition into MIPS or
    Advanced APMs. In the 2017 Quality Payment Program, known as Pick Your
    Pace, physicians could avoid a penalty by submitting only three points,
    which could have been as easy as submitting one quality measure on one
    patient for the entire year. We may find a more accurate reading of how
    well physicians fared under MACRA by looking at the 2018 data, when it
    is released, where physicians were required to submit 15 points to
    avoid a penalty. The performance standard for physicians is even higher
    in 2019, as they are now required to submit 30 points to avoid a
    penalty.

    The 2017 QPP results also show that small practices lagged behind
    larger practices in their overall performance rating for the QPP. The
    average score for small practices was more than 30 points lower than
    the average overall score, and rural groups also lagged 11 points
    behind. Small practices were almost 20 percent less likely to earn a
    bonus and 14 percent more likely to get a penalty than the average
    across all practices. One factor that may prohibit smaller practices
    from succeeding in the QPP is that they often do not have the capital
    to build the office infrastructure necessary to make investments in
    their practices so that they may meet the requirements of the QPP
    program.

    Small practices were also less likely to report more than 90 days of
    quality data which was optional in 2017 but became mandatory in 2018.
    The data show that while 74 percent of all practices reported quality
    data for a full year only 67 percent of rural and 44.5 percent of small
    practices reported a full year of QPP data.

    ACP is disappointed that despite repeated objections from the vast
    majority of stakeholders including the College, CMS continues to
    require a full year of quality and cost data. We ask the Senate Finance
    Committee to weigh in with CMS in the strongest possible terms to urge
    the agency to reconsider this policy and reconsider instituting a
    consistent, minimum 90 consecutive day minimum reporting period across
    all MIPS performance categories. Lowering the minimum reporting period
    to 90 consecutive days would drastically reduce reporting burden, allow
    time to implement EHRs or other innovative technologies without risk of
    compromising MIPS reporting or performance, allow for more timely
    performance feedback, and reduce the two-year lag between performance
    and payment. Moreover, 90 days would be a minimum; while 90 days is a
    sufficient length of time to capture reliable data for the majority of
    measures, individual measures could have their own separate minimums so
    that data accuracy would not be compromised.

    THE MIPS PROGRAM

    The majority of physicians participate in the QPP through the MIPS
    track, which builds on traditional fee-for-service payments by
    adjusting them based on a physician's performance. The MIPS program
    measures physicians' performance based on a scoring structure that
    requires physicians to report performance data to CMS in four weighted
    categories: Quality Measurement (45 percent-weight), Improvement
    Activities (15 percent), Promoting Interoperability (25 percent), and
    Cost (15 percent). Physicians receive a score based on how well they
    perform in each of these categories, which then determines their
    Medicare payment. This scoring structure is unnecessarily complex
    because each category has its own unique scoring methodology and
    because the value of any measure or activity is scored out of an
    arbitrary number of points that has no correlation to its weight
    relative to the final MIPS score. Moreover, the categories are siloed,
    preventing any cross-category credit, and the measures on which
    physicians must report are overly burdensome and do not measure what
    matters.

    The MIPS program was intended to create a more streamlined approach for
    physicians to report performance measures through a unified program
    rather than through several different performance measurement programs
    as required prior to the authorization of MACRA. This program has not
    worked as Congress intended. We urge the Senate Finance Committee to
    exercise their oversight authority to urge CMS to simplify the scoring
    structure and reporting requirements under MIPS in order to fulfill
    Congress' intent of a more streamlined program that reduces burdens on
    physicians.

    MIPS Scoring

    The College reiterates our previous concerns that the separate
    reporting requirements and scoring methodologies for each category are
    confusing for clinicians and counter to CMS' efforts to minimize burden
    and create a unified program. One simple solution would be to assign
    point values for each measure proportionate to their overall value
    relative to the MIPS composite score. The total points in the Pl
    Category would total 25 for example, and so on. This methodology has
    the support of a number of physician groups, and also would allow CMS
    to continue distinguishing high-priority measures and categories with
    more value while creating a more intuitive, streamlined scoring
    approach. We encourage CMS to take every opportunity to award cross
    category credit. Doing so will create synergy between the various
    performance categories and align incentives to drive meaningful
    improvement in critical priority areas, rather than spreading practices
    too thin across too many metrics. This will lead to better patient
    outcomes and less burden on clinicians and practice staff.

    Quality Category

    This category, and MIPS in general, needs more relevant, accurate, and
    effective quality measurement, particularly measures based on patient
    outcomes. We urge the Finance Committee to weigh in with CMS to reduce
    the number of measures required for full participation in this category
    from six to three measures. ACP's Performance Measurement Committee
    (PMC) conducted a study of many of the performance measures included in
    the MIPS program, applicable to internal medicine, and found that only
    37 percent were rated as valid, 35 percent as not valid, and 28 percent
    as of uncertain validity. Measures should be evaluated against four
    critically important criteria: importance to measure, scientifically
    acceptable, usable and relevant, and feasible to collect. CMS should
    collaborate with specialty societies, frontline clinicians, patients,
    and EHR vendors in the development, testing, and implementation of new
    quality measures with a focus on integrating performance measurement
    and reporting within existing care delivery protocols to maximize
    clinical improvement while decreasing clinician burden. A majority of
    new MIPS measures finalized for 2019 have received only conditional
    support from the Measure Application Partnership (MAP), and previously
    adopted measures remain despite being recommended for ``continued
    development'' by the MAP, a designation reserved for measures that lack
    evidence of strong feasibility and/or validity. MAP is a multi-
    stakeholder partnership that guides the U.S. Department of Health and
    Human Services (HHS) on the selection of performance measures for
    federal health programs.

    It is imperative CMS ensure that a transparent, multi-stakeholder
    process is used to evaluate all measures used in its programs. The
    National Quality Forum (NQF), for instance, evaluates measures against
    four critically important criteria: importance to measure
    scientificallyacceptable, usable and relevant, and feasible to collect.
    CMS should also collaborate with 8 specialty societies, frontline
    clinicians, patients, and EHR vendors in the development, testing, and
    implementation of new quality measures with a focus on integrating
    performance measurement and reporting within existing care delivery
    protocols to maximize clinical improvement while decreasing clinician
    burden. Further, the criteria and processes CMS uses to make its final
    decisions regarding which measures to remove from the program and which
    to continue using should also be fully transparent. This would allow
    stakeholders to better plan their efforts in terms of measure
    development and review and provide more meaningful feedback to the
    Agency in the future.

    Cost Category

    Under current statute, MACRA will require CMS to increase the weight of
    the cost category to 30 percent by performance year 2022, but we urge
    Congress to revise the timeline to afford CMS additional flexibility
    just as it did with the Bipartisan Budget Act. The problem with
    maintaining the current timeline for an increase in the weight of the
    cost category is that the measures used to evaluate the cost of care
    are not adequately reliable and accurate. We appreciate CMS' repeated
    efforts to engage stakeholders in the measure development process.
    However, we have serious concerns about moving forward with eight new
    episode-based cost measures that have low average reliability and have
    not been given an adequate opportunity to be fully vetted by
    stakeholders. ACP shares the goal of the cost category to reward
    physicians who are delivering high quality, efficient care, but this
    only works with accurate cost and quality measurement. Otherwise, a
    host of unintended consequences could ensue, such as clinicians being
    penalized for treating sicker or older patients that may require more
    expensive care.

    Promoting Interoperability (PI) Category

    ACP continues to call for the PI Category to be re-conceptualized into
    a performance category that promotes the use of health IT to improve
    patient care and support practical interoperability. While we
    appreciate CMS's attempt to simplify and streamline the PI category in
    the 2019 QPP final rule, the Agency continues to use the same ``EHR-
    functional-use'' measures that clinicians have found to be cumbersome
    and inappropriate and do little to help clinicians move forward in
    using their health IT to improve the value of patient care. CMS should
    further update the PI performance category such that the current ``EHR-
    functional-use'' measures (e.g., e-prescribing and health information
    exchange [HIE] measures) are not scored on an ``all-or-nothing'' basis
    and that one minor misstep by a clinician could result in a score of
    zero for the entire category. CMS should then add in optional measures
    and activities (similar to the Improvement Activities component of
    MIPS) where clinicians can choose and attest to health IT activities
    that leverage health IT to improve patient care and better fit certain
    specialties and scopes of practice.

    ALTERNATIVE PAYMENT MODELS

    Although we are pleased that CMS recently announced the creation of two
    new APMs (Primary Care First and Direct Contracting) that will be
    available for physicians to join in the future, we are disappointed
    that to date, there are only eight active distinct types of Advanced
    APMs. The number of available models falls well short of the robust
    pathway to value-based reform that Congress had envisioned for APMs and
    does not support the Agency's own stated goal of shifting physicians
    into APMs.

    We encourage the Senate Finance Committee to use their oversight
    authority over CMS to encourage the agency to leverage the Physician-
    focused Payment Model Technical Advisory Committee (PTAC) which could
    be an invaluable tool to facilitating the implementation of innovative
    new physician-led APMs but to date has unfortunately been
    underutilized. Few of the now 11 models recommended for limited scale
    testing or full-scale implementation have been adopted by CMS. Many of
    these models have a proven track record of working in the private
    sector; it is to CMS' benefit to capitalize on the substantial
    investment and testing that has already gone into these models.
    Moreover, we have already seen a decline in the number of submissions
    to PTAC. The longer CMS goes without adopting any models, what could be
    a great launching pad for a variety of innovative new payment models
    could cease to serve any practical purpose as enthusiasm wanes and
    developers cease to invest the resources and time into developing
    models without a realistic chance of those models ever being adopted.

    Physicians who qualify to deliver care in an Advanced APM also receive
    a five percent bonus if they meet certain metrics and use certified
    Electronic Health Record Technology, which then excludes them from MIPS
    reporting requirements, a huge incentive. Unfortunately this 5 percent
    bonus is set to expire in 2022 unless Congress approves legislation to
    extend it. We are concerned that if physicians are not assured that
    this five percent bonus will be available in the future, they would be
    less inclined to invest in the necessary infrastructure transformation
    in their practices to deliver care in an Advanced APM. Because one of
    the goals of MACRA was to encourage physicians to transform their
    practices into Advanced APM's, we urge Congress to extend the 5 percent
    bonus beyond 2022 to continue to provide the necessary incentives for
    physicians to deliver care in this model.

    An additional barrier that prevents physicians from transforming their
    practices into Advanced Alternative Payment Models is that physicians
    are required to bear significant financial risk, either 3 percent of
    estimated expenditures or 8 percent of average estimated Medicare Parts
    A and B revenue in order to participate in an APM. CMS intended for
    this threshold of participation as the standard for ``nominal'' risk so
    that additional practices to transform into APM's but this threshold is
    simply too high to be considered a nominal financial risk. CMS should
    also consider that physicians have to invest a significant amount of
    capital in order to afford the infrastructure improvements and practice
    transformation required to participate in an Advanced APM. This
    threshold is especially difficult for smaller and rural practices who
    desire to participate in APMs but often lack the sophisticated
    infrastructure, financial reserves to purchase technologies required
    for interoperability or quality improvement, and ability to take on
    risk that immediately puts them on uneven ground when it comes to
    participating in Advanced APMs. We encourage the Finance Committee to
    support a separate, lower Advanced APM nominal amount standard to
    encourage additional participation in Advanced APMs especially for
    small and/or rural practices.

    NEW PAYMENT MODELS ANNOUNCED BY CMS

    ACP is encouraged that CMS is testing new delivery and payment models
    to support the role of care provided by primary care physicians. Last
    month, the Department of Health and Human Services announced the
    creation of two new payment models, known as Primary Care First and
    Direct Contracting. These models are intended to recognize the value of
    primary care physicians in our health care system by offering
    sustainable and predictable prospective monthly payments to practices,
    to reduce administrative burdens for clinicians, to increase the
    quality of care for patients, and to allow practices and their
    physicians to share in savings from keeping patients healthy and out of
    the hospital whenever possible.

    Internal medicine specialists are uniquely trained to provide adult
    patients with primary and comprehensive care throughout their
    lifetimes, and ACP is supportive of new primary care models that
    recognize and support their contributions to bringing greater value to
    their patients. The new models are important steps in this direction.
    Specifically, ACP is pleased that CMS has considered our
    recommendations to provide a variety of payment and delivery models
    that support internal medicine and primary care practices, from smaller
    and independent practices to larger integrated ones. Of note, ACP is
    optimistic that the new models will emphasize the important role
    primary care plays in value-based care delivery, that models are
    voluntary and have a range of risk options, and that practices should
    use population health management data to reap potential benefits.
    Additionally, ACP is supportive of the fact that the new models aim to
    reduce administrative burdens-potentially allowing physicians to spend
    more time with their patients.

    We are especially interested in the Primary Care First Model that
    ``will focus on advanced primary care practices ready to assume
    financial risk in exchange for reduced administrative burdens and
    performance based payments.'' As noted in the CMS fact sheet on this
    model:

          Primary Care First Model--to be eligible to participate in the
    PCF model, a practice must include ``primary care practitioners (MD,
    DO, CNS, NP and PA), certified in internal medicine, general medicine,
    geriatric medicine, family medicine and hospice and palliative
    medicine.'' It must have 125 attributed Medicare beneficiaries at a
    particular location, have primary care services account for at least
    70% of the practices' collective billing based on revenue, and in the
    case of a multi-specialty practice, 70% of the practice's eligible
    primary care practitioners' combined revenue must come from primary
    care services. It must also ``have experience with value-based payment
    arrangements or payments based on cost, quality, and/or utilization
    performance such as shared savings, performance-based incentive
    payments, and episode-based payments, and/or alternative to fee-for-
    service payments such as full or partial capitation.''

    There are elements of the PCF model that suggest that CMS is on the
    right track to building models that will improve patient care and that
    will support the work of primary care physicians. It provides a variety
    of payment models that will support internal medicine and primary care
    practices, from smaller and independent practices to larger integrated
    ones; it includes a range of risk options available to practices, and
    it could potentially reduce administrative burdens that would allow
    physicians to spend more time with their patients.

    However, a lot of details related to risk adjustment, attribution, and
    financial benchmarking are still missing that may determine how many
    physicians and practices will seek to participate. Also, unless other
    payers join Medicare in supporting the PCF model, practices may not
    experience the reduction in administrative burdens and predictable
    revenue that CMS anticipates. Presumably, CMS will be releasing such
    information soon, prior to the enrollment period it intends to begin
    this fall. As CMS moves forward with the development of new care
    models, we urge the continued creation of new Advanced APMs that
    include multiple payers so that all patients, not just Medicare
    beneficiaries, may benefit from the innovations and improvements to
    patient care that these models may provide. This will also allow those
    practices that voluntarily support these innovative care delivery
    system reform models to focus on a unified set of metrics and goals,
    allowing them to focus on truly improving patient care in key strategic
    areas and get back to delivering patient care, rather than juggling
    dozens of sets of varying reporting metrics.

    Although there is great potential that these models will reinvigorate
    the practice of primary care physicians, we believe the success and
    viability of these models will depend on the extent that they are
    supported by payers in addition to Medicare and Medicaid, are
    adequately adjusted for differences in the risk and health status of
    patients seen by each practice, are provided predictable and adequate
    payments to support and sustain practices (especially smaller
    independent ones), are appropriately scaled for the financial risk
    expected of a practice, are provided meaningful and timely data to
    support improvement, and are truly able to reduce administrative tasks
    and costs, among other things. ACP will continue to evaluate the new
    payment and delivery models based on such considerations, and we look
    forward to working with CMS and to continue advocating for ways to
    support the value of primary care for physicians and for all patients
    across the health care system.''

    THE FUTURE OF MACRA

    After MACRA was passed in 2015, the law established a period of
    positive Medicare payment updates of .5 percent until the end of 2019,
    which are then adjusted upward or downward based on reporting on
    performance measures. After this year, physicians will receive a zero
    percent Medicare baseline payment update from 2020-2025. We remain
    concerned that a zero percent update from 2020-2025 does not provide
    adequate support for physicians to continue to make the necessary
    adjustments to perform at a high level on standards set by MACRA to
    measure quality, clinical improvement, interoperability, and cost data
    related to their practices. As noted in the testimony concerning this
    hearing submitted by the American Medical Association, the recent 2019
    Annual Medicare Trustees Report found that scheduled physician's
    payment amounts are not expected to keep pace with average rate of
    physician cost increases, which are forecast to average 2.2 percent per
    year in the long range. The Medicare Trustees Report also found that
    absent a change in the delivery system or level of update by subsequent
    legislation, the Trustees expect access to Medicare-participating
    physicians to become a significant issue in the long term. We encourage
    members of the Senate Finance Committee to introduce and pass
    legislation that would replace the zero percent baseline payment
    updates under Medicare, scheduled to take effect in 2020, with positive
    updates.

    SUMMARY OF ACP KEY RECOMMENDATIONS

    As the Senate Finance Committee conducts oversight over CMS
    implementation of the Quality Payment Program under MACRA and also
    considers legislative changes to this law, we offer the following key
    recommendations to ensure that MACRA is implemented successfully and as
    intended by Congress.

    Members of the Senate Finance Committee should encourage and provide
    incentives to physicians who transform their practices into Advanced
    APMs and continue to provide stability for physicians in the MIPS
    program by introducing and passing legislation that would do the
    following:

          Extend the five percent Qualified APM participant bonus beyond
    the 2022 performance year.

          Replace the zero percent baseline payment updates under
    Medicare, scheduled to take effect in 2020, with positive updates.

          Revise the timeline to afford CMS with additional flexibility to
    determine the weight of the cost category within MIPS. It is scheduled
    to be 30 percent by performance year 2022.

    Members of the Senate Finance Committee should exercise their oversight
    authority over CMS and urge it to implement the following
    recommendations:

          Expedite approval of more Advanced Alternative Payment models
    (APMS), particularly those that work for small and specialty practices.

          Provide a separate, lower Advanced APM nominal amount to
    encourage participation in Advanced APMs by small and/or rural
    practices.

          Simplify the scoring structure and reporting requirements under
    the Merit-based Incentive Payment System (MIPS) in order to fulfill
    Congress' intent of a more streamlined program that reduces burdens on
    physicians.

          Institute a consistent 90 consecutive day minimum reporting
    period across all MIPS performance categories.

          Reduce the number of measures required for full participation in
    the MIPS quality category from six to three measures.

          Restructure the Promoting Interoperability Category within MIPS
    to remove the ``all-or-nothing'' scoring component and provide more
    flexibility and options for clinicians to use their health IT to
    improve value-based care.

    CONCLUSION

    ACP appreciates the Senate Finance Committee's convening this hearing
    to examine the implementation of MACRA and chart the road ahead for
    this law in the future. We look forward to working with you to ensure
    that MACRA works to improve the value and quality of care delivered to
    patients, provides support for physicians to continue to meet
    performance standards measured by this new law, and additional pathways
    for physicians to transition into Advanced APMs.

                                     ______

                         American Hospital Association

                              800 10th Street, NW

                           Two CityCenter, Suite 400

                           Washington, DC 20001-4956

                                 (202) 638-1100

    On behalf of our nearly 5,000 member hospitals, health systems and
    other health care organizations, and our clinician partners--including
    more than 270,000 affiliated physicians, 2 million nurses and other
    caregivers--and the 43,000 health care leaders who belong to our
    professional membership groups, the American Hospital Association (AHA)
    appreciates the opportunity to submit comments on the implementation of
    the Quality Payment Program (QPP) created by the Medicare Access and
    CHIP Reauthorization Act of 2015 (MACRA).

    Three years into its implementation, the QPP continues to have a
    significant impact, not only on physicians and other clinicians, but
    also on the hospitals and health systems with whom they partner to
    deliver care. There remains strong interest from the field in
    participating in advanced alternative payment models (APMs) to support
    new models of care, and to qualify for the bonus payment and exemption
    from the QPP's Merit-based Incentive Payment System (MIPS). However,
    opportunities to access the Advanced APM track remain significantly
    constrained. In the calendar year (CY) 2019 Physician Fee Schedule
    final rule, the Centers for Medicare and Medicaid Services (CMS)
    estimated that as few as 16 percent of eligible clinicians will qualify
    for the Advanced APM track in 2021.

    The AHA urges Congress to continue working with CMS to provide greater
    opportunity to participate in Advanced APMs. 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 the new payment models--improving quality, outcomes and
    efficiency in the delivery of patient care. Finally, opportunities
    remain to improve fairness and reduce burden under the MIPS.

    Our detailed comments follow.

    Broadening Opportunities for Advanced APM Participation

    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 (ACOs), 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 and underpaid services.

    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 Medicare APMs introduced thus far, and existing
    models have not provided participation opportunities evenly across
    physician specialties. Therefore, many physicians are still exploring
    APMs for the first time or at only the early stages of transforming
    care under APM arrangements. As a general principle, the AHA believes
    the APM provisions of MACRA should be implemented in a broad manner
    that provides the greatest opportunity for physicians who so choose to
    become qualifying APM participants. CMS should take an expansive
    approach that encourages and rewards physicians who demonstrate
    movement toward APMs. The agency also should ensure that it designs
    APMs with a fair balance of risk and reward, standardized and targeted
    quality measures and risk adjustment methodologies, physician
    engagement strategies, and readily available data and feedback loops
    between CMS and participants.

    While we acknowledge and appreciate CMS's development and
    implementation of more APMs that qualify as Advanced APMs, we continue
    to be concerned that these existing and announced APMs offer too few
    opportunities for certain types of providers that serve more dispersed
    and vulnerable populations. For example, rural providers often lack the
    access or ability to make investments needed to participate in new
    models, among the many other challenges they face given their
    geographic location, low patient volumes, aging infrastructure in which
    they practice, workforce shortages and other factors. High-risk APMs
    are not accessible to these providers, even those that wish to
    participate in them. Similarly, post-acute and behavioral health
    providers serve particularly challenging and unique populations and
    thus are in need of APM options tailored to the degree of risk they can
    manage given their patient populations. CMS should consider these and
    other providers when designing APMs and expand opportunities for them
    to participate in Advanced APMs that offer them targeted resources and
    a manageable amount of risk.

    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,
    MACRA marks 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 2016 AHA report, Legal (Fraud and Abuse)
    Barriers to Care Transformation and How to Address Them (Wayne's
    World), 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.

    Addressing MIPS Policy Priorities

    The AHA has urged that CMS implement the MIPS in a way that measures
    providers accurately and fairly; minimizes unnecessary data collection
    and reporting burden; focuses on high-priority quality issues; and
    fosters collaboration across the silos of the health care delivery
    system. To achieve this desired state, we have recommended that CMS
    prioritize the following policy approaches:

          Adopt gradual, flexible increases in MIPS reporting requirements
    in the initial years of the program to allow the field sufficient time
    to plan and adapt.

          Streamline and focus the MIPS quality and cost measures to
    reflect the measures that matter the most to improving outcomes.

          Allow facility-based clinicians the option to use their
    facility's CMS quality reporting and pay-for-performance results in the
    MIPS.

          Employ risk adjustment rigorously--including sociodemographic
    adjustment, where appropriate--to ensure providers do not perform
    poorly in the MIPS because of differences in clinical severity and
    communities they serve.

          Align the requirements for eligible clinicians in the Promoting
    Interoperability (formerly known as advancing care information)
    performance category with the requirements for eligible hospitals and
    critical access hospitals (CAHs).

    The AHA is pleased that CMS has made important progress in addressing
    the above priorities. For example, in the first three MIPS performance
    years (calendar years (CY) 2017 through 2019), CMS has adopted gradual
    increases to the length of reporting periods, data standards and the
    performance threshold for receiving positive or negative payment
    adjustments. The AHA also commends CMS for using its new ``Meaningful
    Measures'' initiative to remove 26 measures from the MIPS program in
    the CY 2019 physician fee schedule final rule. CMS also has brought the
    Promoting Interoperability programs for clinicians and hospitals into
    far greater alignment. We offer our perspective on other MIPS policy
    priorities below.

    Facility-based Measurement. The AHA applauds CMS for responding to our
    long standing request to develop a facility-based measurement option
    for the MIPS that is available starting this year. We believe the
    option ultimately will help clinicians and hospitals alike spend less
    time collecting data, and more time improving care. Under this
    approach, clinicians that spend 75 percent or more of their time in a
    hospital inpatient, emergency department (ED) setting or on-campus
    hospital outpatient setting can use their hospital's CMS hospital
    value-based purchasing program performance in the MIPS without having
    to report separate quality or cost data. In short, it means those
    clinicians and hospitals can focus their efforts on the same set of
    priorities, and see their performance rewarded in a consistent fashion.

    Congress can help make facility-based measurement even more beneficial
    and effective by encouraging CMS to consider future expansion of the
    option to a broader array of facility types, such as post-acute care
    and inpatient psychiatric care providers. In last year's rulemaking
    process, CMS signaled an openness to expanding the option.

    MIPS Cost Category. We urge Congress to work with CMS to take a more
    gradual approach to increasing the weight of the MIPS cost category, as
    well as adding measures to the cost category. Hospitals and clinicians
    alike are focused on improving the value of care and need well-designed
    measures of cost and resource use to help inform their efforts.
    However, we believe CMS's recent decision to increase the weight of the
    cost category to 15 percent of the total MIPS score and to adopt eight
    new episode-based cost measures should be delayed until CY 2022 at the
    very earliest.

    Serious questions remain about the accuracy and reliability of all of
    the measures in the MIPS cost category, making it problematic to
    increase the weight beyond the 10 percent weight adopted for CY 2020
    payments. CMS's recent changes to the Medicare spending per beneficiary
    (MSPB) measure underscore this point. In the CY 2017 QPP final rule,
    CMS chose to remove specialty adjustment from the MSPB measure, and
    lower the MSPB minimum volume threshold from 125 cases to just 20
    cases. Yet neither of these changes had strong data or analysis to
    support them. Specialty adjustment in MSPB is intended to account for
    differences in specialty mix that can affect the costs of care.
    Furthermore, the MSPB measure once had a minimum case threshold of 125
    cases because CMS's analyses suggested that many cases were necessary
    to get a statistically reliable result. We do not believe the measure
    materially changed in such a way that it achieves reliable results
    without the higher case threshold. Taken together, we worry that these
    measure changes will result in rewards or penalties based on
    differences in patient population or statistical noise, and not real
    performance differences.

    The AHA also remains concerned that the basic performance attribution
    approach for the MSPB and cost per capita measures in the MIPS lacks a
    ``line of sight'' from clinician actions to measure performance. The
    measures do not reflect the performance of just the clinician or group
    practice. Rather, the measures attribute all of the Medicare Parts A
    and B costs for a beneficiary during a defined episode (three days
    prior to 30 days after an inpatient admission for MSPB, and a full year
    for total cost per capita). Yet, these costs reflect the actions of a
    multitude of health care entities--hospitals, physicians, post-acute
    providers, etc. The ability for any clinician or group to influence
    overall measure performance will vary significantly depending on local
    market factors, including the prevalence of clinically integrated
    networks.

    Lastly, while we appreciate the concept behind the episode-based
    measures, we are concerned that clinicians have had limited time to
    understand their baseline performance and implement changes to improve
    performance. In contrast to the two total cost measures, the episode-
    based measures include only the items and services related to the
    episode of care for a particular treatment or condition. This
    measurement approach can result in a more clinically coherent set of
    information about cost. However, this approach also necessitates the
    use of algorithms for identifying costs relevant to an episode, and a
    multi-step approach for attributing measure performance. This
    methodology adds necessary rigor, but also complexity. Yet, clinicians
    only had information from a ``dry run'' of the episode measures that
    CMS conducted using data from 2016 before CMS added the measures to the
    program.

    Enhancing Risk Adjustment. Congress should encourage CMS to continue
    refining its approach to accounting for both clinical and social risk
    factors in measuring performance outcomes. CMS took an important step
    toward recognizing the impact of sociodemographic and other risk
    factors on outcomes by adopting a ``complex patient bonus'' in the MIPS
    in 2018. Clinicians receive up to five bonus points on their MIPS Final
    Scores based on a Medicare claims-derived proxy for patient complexity
    (Hierarchical Condition Categories, or HCCs), as well as the number of
    patients dually eligible for Medicare and Medicaid that a clinician or
    group treats. Dual-eligible status is a proxy for sociodemographic
    factors.

    However, experience from the use of HCC scores in the value-based
    payment modifier (VM) raises questions about its adequacy in accounting
    for patient risk. CMS used HCC scores to provide modest increases to
    performance scores to groups treating significant numbers of high-risk
    patients. Unfortunately, the results of the 2016 VM program show that
    group practices caring for patients with more clinical risk factors
    were still significantly more likely to receive negative VM
    adjustments. Furthermore, while dual eligibility is an established
    proxy for sociodemographic status, there are others--such as income and
    education--that may be more accurate adjusters for particular measures.
    We urge that the patient complexity bonus be viewed as an interim step
    while methodologies for accounting for social and clinical risk
    continue to evolve.

    Evolving MIPS in the Future

    As with any significant policy change, the QPP and MIPS will need
    ongoing refinements to ensure it meets its goals. Indeed, that is why
    Congress used the Bipartisan Budget Act of 2018 to make several welcome
    technical amendments to the MIPS, such as allowing CMS more time to
    increase the weight of the MIPS cost category and applying payment
    adjustments to only covered professional services. These changes give
    providers and CMS greater flexibility, and improve the program's
    fairness.

    Indeed, the AHA believes that future changes to MIPS policy should
    continue to be informed by data, experience and input from this field.
    That is why we believe the Medicare Payment Advisory Commission
    (MedPAC) recommendation in its March 2018 Report to Congress to replace
    the MIPS with a new voluntary value program (WP) is premature. We refer
    the Committee to our March 2018 statement to the committee for
    additional information.

    CONCLUSION

    Thank you for the opportunity to share our views on the implementation
    of the MACRA's QPP. The AHA looks forward to working with Congress, CMS
    and all other stakeholders to ensure MACRA enhances the ability of
    hospitals and physicians to deliver quality care to patients and
    communities, and advance health in America.

                                     ______

                     American Society of Clinical Oncology

                           2318 Mill Road, Suite 800

                              Alexandria, VA 22314

                T: 571-483-1300 / F: 571-366-9530 / www.asco.org

    May 6, 2019

    Hon. Chuck Grassley
    Chair
    U.S. Senate
    Committee on Finance
    Washington, DC 20510

    Hon. Ron Wyden
    Ranking Member
    U.S. Senate
    Committee on Finance
    Washington, DC 20510

    Dear Chairman Grassley and Ranking Member Wyden,

    The American Society of Clinical Oncology (ASCO) is pleased to submit
    comments for the Committee's hearing, ``Medicare Physician Payment
    Reform After Two Years: Examining MACRA Implementation and the Road
    Ahead.''

    ASCO is the national organization representing more than 45,000
    physicians and other health care professionals specializing in cancer
    treatment, diagnosis, and prevention. We are committed to ensuring that
    evidence-based practices for the treatment of cancer are available to
    all Americans.

    ASCO supported the passage of the Medicare Access and CHIP
    Reauthorization Act of 2015 (MACRA) as a replacement to the flawed
    Sustainable Growth Rate. Since its enactment, ASCO has educated its
    members on MACRA and how to make it work for both their practices and
    the Medicare beneficiaries they serve. We have extensive MACRA-related
    practice tools, webinars, and other resources readily available for our
    members on asco.org/MACRA.

    We appreciate the Committee's shared commitment to MACRA's success, and
    we offer the following ideas for how Congress and the Centers for
    Medicare and Medicaid Services (CMS) can strengthen MACRA and the
    Medicare program.

    Encourage the Creation of Value-Based Incentives That Increase Quality
                        and Lower Cost

    ASCO members practice in diverse settings, including community-based
    physician practices, outpatient cancer centers, teaching hospitals, and
    large cancer treatment centers. Our members participate in a variety of
    value-based payment models, including the Merit-based Incentive Payment
    System (MIPS), Alternative Payment Models (APMs) with private payers,
    the Center for Medicare and Medicaid Innovation (CMMI) sponsored
    Oncology Care Model (OCM) and other CMMI sponsored models. As strong
    advocates of high-quality, high-value care, ASCO has supported
    development of new payment models that include the full scope of
    services needed by patients facing a cancer diagnosis. We do not agree
    with piecemeal reforms based on cost alone.

    A key component of OCM is the sharing of Medicare claims data, which
    provides physicians the information necessary to understand the total
    cost of care borne by Medicare and patients. Analysis of these data has
    highlighted opportunities to reduce health care costs. We have heard
    from participating practices that oncology-specific care management
    payments, such as OCM's monthly-enhanced oncology service (MEOS)
    payments, provide funding to support resources such as navigators,
    triage nurses, and palliative care specialists. This helps to mitigate
    some of the costs for these previously uncovered services that are
    critical to quality care in oncology. We note that, for many practices,
    a large portion of the MEOS payment has been consumed by administrative
    support needed to comply with required reporting and analysis of data.
    This has drawn MEOS payments away from the intended patient services
    support and is an area where ongoing discussion will be important.

    Practices participating in APMs continue to undergo transformation.
    Many have reported hiring clinical and financial navigators to improve
    coordination of care and proactively manage symptoms that would
    otherwise lead to acute care admissions or other long-term expenses.
    Practices have also employed value-based decision support tools, such
    as treatment and triage pathways.

    Overall, participation in these payment models have resulted in reduced
    admissions, improved end-of-life quality measure performance, and
    increased patient satisfaction.

    Adopt the Patient-Centered Oncology Payment Model (PCOP)

    Medicare coding and payment for outpatient cancer treatment should be
    transformed by adopting proposals such as ASCO's ``Patient-Centered
    Oncology Payment Model'' (PCOP) and implementing policies that are
    consistent with that model. Originally published in 2015, ASCO has
    recently convened a diverse team of clinicians, payer and employer
    representatives to update the PCOP model and incorporate learnings from
    OCM and multiple commercial payer models.

    The updated PCOP incorporates a community-centric oncology medical home
    structure, that encourages a true multi-payer approach. The use of
    evidence-based clinical treatment pathways is a cornerstone of the PCOP
    model, along with measurement and rewards for high-quality, high-value
    care.

    A draft of the updated PCOP model has been provided to the CMMI and
    will be submitted to the Physician Focused Payment Model Technical
    Advisory Committee later this year. Should the PTAC recommend
    acceptance, Congressional support will be imperative for CMMI approval.
    ASCO is already in discussions with states and local communities who
    are interested in the PCOP model to advance cancer care for their
    population.

    Test Multiple Oncology-focused Alternative Payment Models

    ASCO urges Congress to work with CMMI to create and adapt a multi-step
    process for developing and implementing APMs--one that begins with
    limited-scale testing and then refinement or expansion of promising
    APMs over time. ASCO believes that by utilizing small-scale testing of
    multiple oncology-focused APMs, CMS can highlight potentially
    successful strategies for the broader community of cancer patients and
    oncology professionals.

    For cancer, ASCO urges Congress and CMS to encourage the approval of
    multiple APMs because of the varied needs of cancer populations and
    providers. Oncology practices exist in numerous forms, and a ``one size
    fits all'' approach to payment models fails to take advantage of the
    strength of each of these practice structures. In this context, care
    should be taken not to disadvantage small and rural practices, which
    fulfill a crucial role in oncology care. While CMS has taken concrete
    steps to assist small practices participating in MIPS, such as freely
    available technical assistance and special considerations related to
    their scoring in the MIPS framework, small and rural practices fared
    less well under MIPS in the first performance year (2017): while the
    overall national mean score for a clinician was 74 points, clinicians
    in small and rural practices had national means of 43 points and 63
    points, respectively. CMMI should embrace oncology-focused APMs that
    differ from the existing OCM, as well as from other existing models
    that are not specifically focused on cancer.

    Exclude Medicare Drug Cost From Resource Use in Cancer Care

    ASCO has urged CMS to exclude all Medicare Part Band D drug costs from
    the assessment of cost performance and refrain from increasing the
    weight of cost performance category in the MIPS scoring methodology
    until it implements a cost measurement methodology that fairly and
    accurately assesses resource use in cancer care.

    The current cost measurement methodologies are inadequate for measuring
    cost performance for oncology focused providers and practices due to
    several unique characteristics of cancer care. Cancer is a complex
    disease state with multiple forms. Treatment decisions are highly
    dependent upon a patient's unique medical characteristics, including
    their cancer morphology, cancer stage, genetic characteristics,
    mutation status, comorbidities and preferences. Individual physicians
    often specialize in treating specific types of cancer that may be
    especially complex or expensive to treat. Protecting the most
    vulnerable Medicare beneficiaries will require CMS to account for these
    considerations without threatening the viability of subspecialties that
    focus on treating certain cancers.

    Promote Interoperability

    Interoperability and the free exchange of health care information are
    core components to realizing the potential of a value-based health care
    system.

    ASCO commends CMS for reforming the Promoting Interoperability (Pl)
    performance category measures to emphasize the exchange of health
    information, but we remain concerned that the scoring for this category
    remains essentially ``all or nothing,'' which places a heavy penalty on
    practices which fail to meet one of the criteria. We understand that
    CMS is exploring potential options to move toward more customized
    scoring of this category through incentives for innovative use of HIT,
    and ASCO would be eager to discuss our ideas for how this could be
    accomplished with CMS.

    Despite our many steps forward in this area, oncology practitioners are
    still plagued by a lack of interoperability between different types of
    electronic medical records (EMRs) in addition to a lack of
    interoperability between EMRs and other forms of health information
    technology including electronic systems such as registries, genomic
    testing laboratories, and hospital laboratory information systems.
    These types of technology hold great promise for improving and
    enhancing patient care, especially in the realm of care coordination
    and quality improvement. To further enhance healthcare quality, we
    should move with urgency towards realizing the vision of seamlessly
    integrated health information, easily and securely accessible to all
    patients.

    A basic need in the field of oncology is a common, shared set of data
    elements used to exchange information between providers and patients.
    Under our CancerlinQ (CLQ') subsidiary, ASCO is currently
    developing a set of ``Minimal Common Oncology Data Elements''
    (mCODETM), an effort designed to result in a parsimonious
    set of consensus-developed oncology data elements necessary for
    critical information exchange between EHRs, for clinical care, quality
    reporting, and other use cases. This set of oncology data elements is
    envisioned by ASCO to form the basis of an initial parsimonious set of
    necessary data that should populate all electronic health records
    (EHRs) serving patients with cancer. Adoption of these data elements,
    which are being developed by experts in the fields of oncology and
    informatics, would greatly streamline the exchange of basic needed data
    necessary for oncologists. The National Cancer Institute (NCI) is
    engaged with this project, and we look forward to collaborating with
    agencies such as ONC wherever possible to encourage consideration and
    adoption of these elements when they are finalized. We have previously
    provided ONC with our description of this work and will continue to
    keep the agency abreast of our efforts; we are currently engaged in a
    pilot project with a large healthcare system as proof of concept in
    anticipation of wider adoption of these oncology data elements, which
    we believe would streamline communication between care providers and
    positively impact patient care.

    Encourage Adoption of High-Quality Clinical Pathways

    ASCO strongly supports the utilization of high-quality value-based
    oncology clinical pathways. As health care payment models continue to
    advance, private insurers have already embraced the use of oncology
    clinical pathways that incorporate both evolving scientific evidence
    and considerations of cost and value. We have encouraged the Medicare
    program to adopt high-quality value-base d pathways as a mechanism to
    assure high-quality and high-value care for the Medicare population.

    Clinical pathways are regularly updated treatment protocols that map
    care based on current scientific evidence. When used appropriately,
    high-quality pathways can reduce unwarranted variations in care and
    focus resources on the most appropriate and valuable therapies while
    still allowing for justifiable individualized decision-making. Placing
    adherence to clinical pathways at the center of an oncology-based care
    model can improve quality, efficiency, and value of medical oncology
    services for Medicare beneficiaries, and would align Medicare policy
    with ongoing pathway initiatives in use by commercial payers.

    ASCO has done extensive work examining pathways in oncology and has
    developed robust criteria for the development and implementation of
    pathway programs. ASCO has used these criteria to assess clinical
    pathway vendors. For more information on clinical pathways please
    visit: https://www.asco.org/practice-guidelines/cancer-care-
    initiatives/clinical-pathways.

    Improve Access to Claims Data

    MACRA required CMS to make its data easier to access, especially for
    the purpose of linking clinical registries to CMS claims data. CMS is
    using its existing ResDAC process instead, which is cumbersome, time
    consuming to navigate, and strictly limits use of the data. CMS should
    allow much easier access to its data, as intended by Congress in the
    MACRA legislation. Congress should work with CMS to ensure these
    changes are made.

    Thank you for your commitment to improving the Medicare program. If you
    have questions on any issue involving the care of individuals with
    cancer or would like to be directed to ASCO's thoughts on a specific
    issue related to drug pricing, please contact Jennifer Brunelle at
    Jennifer.brunelle@asco.org.

    Sincerely,

    Monica M. Bertagnolli, MD, FACS, FASCO
    President, American Society of Clinical Oncology

                                     ______

                            Center for Fiscal Equity

                            14448 Parkvale Road, #6

                           Rockville, Maryland 20853

                          Fiscalequitycenter@yahoo.com

                          Statement of Michael Bindner

    Chairman Grassley and Ranking Member Wyden, thank you for the
    opportunity to comment on this issue. We will leave it to the
    Administration witnesses to address MACRA Implementation and confine
    ours comments to the Road Ahead, specifically the how Medicare for All
    will impact these reforms

    Under Medicare for All proposals, it is assumed that insurance rates
    and copayments will be reduced to Medicare levels. Payments to
    Physicians will continue under Medicare rates, presumably relying on
    current reforms, such as MACRA, to help control the funding gap, with
    some kind of payroll or value added tax replacing premium payments,
    regulation of monopolistic hospital chains as public utilities,
    including negotiations to control both hospital and drug prices.

    Monopoly and monopsony power already control costs to increase profit
    to shareholders. Negotiation will aim to reduce these profit margins.
    Please see our attachment which excerpts previous comments from last
    year on Medicare Advantage, including a more detailed exploration of
    Medicare for All.

    Thank you for the opportunity to address the committee. We are, of
    course, available for direct testimony or to answer questions by
    members and staff.

    Attachment One--Hearing on the Medicare Advantage Program

    Medicare for All, Do We Already Have It?

    Medicare for All is a really good slogan, at least to mobilize the
    base. One would think it would attract the support of even the Tea
    Partiers who held up signs saying ``Don't let the government touch my
    Medicare!'' Alas, it has not. This has been a conversation on the left
    and it has not gotten beyond shouting slogans either. We need to decide
    what we want and whether it really is Medicare for All. If we want to
    go to any doctor we wish, pay nothing and have no premiums, then that
    is not Medicare.

    There are essentially two Medicares, a high option and a low one. One
    option has Part A at no cost (funded by the Hospital Insurance Payroll
    Tax and part of Obamacare's high unearned income tax as well as the
    general fund), Medicare Part B, with a 20% copay and a $135 per month
    premium and Medicare Part D, which has both premiums and copays and is
    run through private providers. Parts A and B also are contracted out to
    insurance companies for case management.

    The other option is the Medicare Advantage (Part C) HMO. You pay a
    premium and copays, but there is much more certainty, while ABD are
    more like a PPO, but costs can go much higher. So much higher that some
    seniors and the disabled get Medicap coverage for the copays. Which is
    high and which low, I am not sure. They are both now managed care.

    Medicaid lingers in the background and the foreground. It covers the
    disabled in their first two years (and probably while they are seeking
    disability and unable to work). It covers non-workers and the working
    poor (who are too poor for Obamacare) and it covers seniors and the
    disabled who are confined to a long-term care facility and who have run
    out their assets. It also has the long term portion which should be
    federalized, but for the poor, it takes the form of an HMO, but with no
    premiums and zero copays.

    Obamacare has premiums with income-based supports (one of those facts
    the Republicans hate) and copays. It may have a high option, like the
    Federal Employee Health Benefits Program (which also covers Congress)
    on which it is modeled, a standard option that puts you into an HMO.
    The HMO drug copays for Obamacare are higher than for Medicare Part C,
    but the office visit prices are exactly the same.

    What does it mean, then, to want Medicare for All? If it means we want
    everyone who can afford it to get Medicare Advantage Coverage, we
    already have that. It is Obamacare. The reality is that Senator Sanders
    wants to reduce Medicare copays and premiums to Medicaid levels and
    then slowly reduce eligibility levels until everyone is covered. Of
    course, this will still likely give us HMO coverage for everyone except
    the very rich, unless he adds a high-option PPO or reimbursable plan.

    Either Medicare for All or a real single payer would require a very
    large payroll tax (and would eliminate the HI tax) or an employer paid
    subtraction value-added tax (so it would not appear on receipts nor
    would it be zero rated at the border, since there would be no evading
    it), which we discuss below, because the Health Care Reform debate is
    ultimately a tax reform debate. Too much money is at stake for it to be
    otherwise, although we may do just as well to call Obamacare Medicare
    for All and agree to leave it alone.

    Social Insurance

    It is always important to note that the whole purpose of social
    insurance, including Medicare, is to prevent the imposition of unearned
    costs and payment of unearned benefits for not only the beneficiaries,
    but also their families. Cuts which cause patients to pick up the slack
    favor richer patients, richer children and grandchildren, patients with
    larger families and families whose parents and grandparents are already
    deceased, given that the alternative is higher taxes on each working
    member. Such cuts would be an undue burden on poorer retirees without
    savings, poor families, small families with fewer children or with
    surviving parents, grandparents and (to add insult to injury) in laws.

    Recent history shows what happens when benefit levels are cut too
    drastically. Prior to the passage of Medicare Part D, provider cuts did
    take place in Medicare Advantage (as they have recently). Utilization
    went down until the act made providers whole and went a bit too far the
    other way by adding bonuses (which were reversed in the Affordable Care
    Act).

    Funding Levels and Premium Increases

    Shifting to more public funding of health care in response to future
    events is neither good nor bad. Rather, the success of such funding
    depends upon its adequacy and its impact on the quality of care--with
    inadequate funding and quality being related. One form of increased
    funding could very well be higher Part B and Part D premiums (or Part
    C). This has been suggested by both the Fiscal Commission and the
    Bipartisan Policy Center. In order to accomplish this, however, a
    higher base premium in Social Security would be necessary. Our proposal
    is that to do this, the employee income cap on contributions should
    actually be lowered to decrease the entitlement for richer retirees
    while the employer income cap is eliminated, the employer and employee
    payroll taxes are decoupled and the employer contribution credited
    equally to each employee at some average which takes in all income. If
    a payroll tax is abandoned in favor of some kind of consumption tax,
    all income, both wage and non-wage, would be taxed and the tax rate may
    actually be lowered.

    Ultimately, fixing health care reform will require more funding,
    probably some kind of employer payroll or net business receipts tax--
    which would also fund the shortfall in Medicare and Medicaid (and take
    over most of their public revenue funding), regardless of whether Part
    B and D premiums are adjusted. If the same consumption tax pays both
    retirement income and government health plans, the impact on the
    taxpayer is exactly nil in the long term.

    Funding Options Through Tax Reform

    We will now move to an analysis of funding options and their impact on
    patient care and cost control.

    The committee well understands the ins and outs of increasing the
    payroll tax, so we will confine our remarks to a fuller explanation of
    Net Business Receipts Taxes (NBRT). Its base is similar to a
    Subtraction Value-Added Tax (VAT).

    Unlike a VAT, an NBRT would not be visible on receipts and should not
    be zero rated at the border--nor should it be applied to imports. While
    both collect from consumers, the unit of analysis for the NBRT should
    be the business rather than the transaction. As such, its application
    should be universal--covering both public companies who currently file
    business income taxes and private companies who currently file their
    business expenses on individual returns.

    If employer-provided care to retirees is not included, the best funding
    mechanism is a Value-Added Tax with border adjustment, but at a higher
    rate to cover the loss. The key difference between the two taxes is
    that the NBRT should be the vehicle for distributing tax benefits for
    families, particularly the Child Tax Credit, the Dependent Care Credit
    and the Health Insurance Exclusion, as well as any recently enacted
    credits or subsidies under the ACA. In the event the ACA is reformed,
    any additional subsidies or taxes should be taken against this tax (to
    pay for a public option or provide for catastrophic care and Health
    Savings Accounts and/or Flexible Spending Accounts).

    The NBRT can provide an incentive for cost savings if we allow
    employers to offer services privately to both employees and retirees in
    exchange for a substantial tax benefit, either by providing insurance
    or hiring health care workers directly and building their own
    facilities. Employers who fund catastrophic care or operate nursing
    care facilities would get an even higher benefit, with the proviso that
    any care so provided be superior to the care available through
    Medicaid. Making employers responsible for most costs and for all cost
    savings allows them to use some market power to get lower rates, but no
    so much that the free market is destroyed.

    This proposal is probably the most promising way to arrest health care
    costs from their current upward spiral--as employers who would be
    financially responsible for this care through taxes would have a real
    incentive to limit spending in a way that individual taxpayers simply
    do not have the means or incentive to exercise. While not all employers
    would participate, those who do would dramatically alter the market. In
    addition, a kind of beneficiary exchange could be established so that
    participating employers might trade credits for the funding of former
    employees who retired elsewhere, so that no one must pay unduly for the
    medical costs of workers who spent the majority of their careers in the
    service of other employers.

    The NBRT would replace disability insurance, hospital insurance, the
    corporate income tax, business income taxation through the personal
    income tax and the mid-range of personal income tax collection,
    effectively lowering personal income taxes by 25% in most brackets.

    Note that collection of this tax would lead to a reduction of gross
    wages, but not necessarily net wages--although larger families would
    receive a large wage bump, while wealthier families and childless
    families would likely receive a somewhat lower net wage due to loss of
    some tax subsidies and because reductions in income to make up for an
    increased tax benefit for families will likely be skewed to higher
    incomes. For this reason, a higher minimum wage is necessary so that
    lower wage workers are compensated with more than just their child tax
    benefits.

                                     ______

                         Healthcare Leadership Council
    May 8, 2019

    The Honorable Chuck Grassley        The Honorable Ron Wyden
    Chairman                            Ranking Member
    U.S. Senate                         U.S. Senate
    Committee on Finance                Committee on Finance
    219 Dirksen Senate Office Building  219 Dirksen Senate Office Building
    Washington, DC 20510                Washington, DC 20510

    Dear Chairman Grassley and Ranking Member Wyden:

    As the Senate Committee on Finance holds a hearing on, ``Medicare
    Physician Payment Reform After Two Years: Examining MACRA
    Implementation and the Road Ahead,'' the Healthcare Leadership Council
    (HLC) welcomes the opportunity to share its perspectives with you.

    HLC is a coalition of chief executives from all disciplines within
    American healthcare. It is the exclusive forum for the nation's
    healthcare leaders to jointly develop policies, plans, and programs to
    achieve their vision of a 21st century healthcare system that makes
    affordable high-quality care accessible to all Americans. Members of
    HLC--hospitals, academic health centers, health plans, pharmaceutical
    companies, medical device manufacturers, laboratories, biotech firms,
    health product distributors, post-acute care providers, home care
    providers, and information technology companies--advocate for measures
    to increase the quality and efficiency of healthcare through a patient-
    centered approach.

    HLC has long supported a shift away from fee-for-service healthcare
    toward a system based on providing better value for healthcare
    consumers. Our member organizations have been proponents of delivery
    system innovations that are value-based, patient-centered and reward
    improved quality and cost-effective care.

    HLC strongly supported the ``Medicare Access and CHIP Reauthorization
    Act (MACRA) of 2015'' and is pleased to provide feedback that we expect
    will strengthen the broader transition to a payment system that
    emphasizes value. As providers in the delivery system transition to a
    new payment system that emphasizes value, we encourage prioritizing
    consumer feedback and outreach, provider feasibility and minimizing new
    administrative burdens. We have been pleased to see significant action
    on key recommendations provided by HLC in previous years.

    In particular:

          HLC supports CMS's recognition of Medicare Advantage (MA) as an
    advanced alternative payment model. In payment years 2019 and 2020, the
    participation criteria for Advanced APMs were only for traditional
    Medicare payments or patients. Starting in payment year 2021, the
    participation requirements for Advanced APMs may include MA plans. The
    demonstration would allow physicians that participate in value-based
    arrangements with MA plans to see the same payment benefits as
    physicians participating in one of the CMS designated Advanced
    Alternative Payment Models (AAPMs).

          HLC encourages Congress and the Administration to continue to
    push forward with its efforts to facilitate the movement of
    organizations to pay-for-performance and AAPMs. A critical element of
    this effort will be incorporating complementary value-based
    arrangements (such as Medicare Advantage) into AAPM MACRA thresholds as
    soon as possible.

          HLC strongly supports efforts to reduce the quality measure
    reporting burden on clinicians. HLC continues to emphasize that this
    flexibility is necessary as it may be difficult--particularly in the
    initial years--to design APMs that are attractive to a variety of
    providers. The federal government must ensure, however, that these
    flexibilities do not lessen important incentives for provider
    participation.

          HLC supports the creation of a new improvement activity for
    clinician leadership in clinical trials, research alliances, or
    community-based participatory research (CBPR)--especially around
    minimizing disparities in healthcare access. HLC supports this effort
    to improve clinical trial enrollment and encourages the federal
    government to consider including other physicians or even a counseling
    service payment to incentivize providers to provide information on
    clinical trials.

    As shared in previous correspondence, HLC continues to emphasize
    several broader priorities that we believe are critical for the overall
    success of value-based care programs.

    Congress should adopt changes to modernize the federal fraud and abuse
    legal framework to facilitate stronger provider performance in the
    Merit-based Incentive Payment System (MIPS) measurement categories and
    facilitate growth into full AAPMs. Modernization of the current legal
    framework is needed to make it more compatible with healthcare delivery
    system transformation while retaining appropriate protections against
    fraud and abuse. Congress should amend the Anti-Kickback Statute and
    Stark Law to allow waivers for stakeholders engaged in alternative
    payment arrangements (both AAPMs and MIPS reporting APMs) that meet
    certain conditions. The current unpredictable and burdensome system of
    ``one-off'' waivers is not sufficient for alternative payment goals.
    Congress should also extend existing Anti-Kickback Statute and Stark
    Law exceptions for donation and financial support of electronic health
    information products that facilitate care coordination, cybersecurity
    protection, and compliance with systems' interoperability goals.

    Quality measurement and coding updates should better incorporate
    socioeconomic status adjustments to incentivize alternative payment
    arrangements in areas of high need. It is critical that all efforts to
    move to outcome-based payment properly account for complexities of
    patients as well as the socioeconomic challenges that providers face in
    caring for patients. Without these adjustments, efforts to reward
    higher performing providers may result in lower funding for those
    serving the most vulnerable. To ensure appropriate payment and risk-
    adjustment, quality programs under MACRA should include a reasonable
    number of measures that effectively capture variance in patient
    populations. We support the use of a limited number of standard, vetted
    measures and urge CMS to synchronize measures, expectations, and
    reporting requirements with existing efforts in the private sector. By
    working closely with experts in the private sector, a system that
    appropriately reflects health system challenges--such as the social and
    economic status of consumers--can create a more accurate payment
    system.

    Traditionally, ICD-10 codes are used to document diagnoses, symptoms,
    treatment, and procedures into the patient medical record. The
    expansion of these codes to include social determinants of health,
    including socioeconomic status, education, geographic location, home
    environment, functional limitation, employment, access to healthcare,
    transportation, food and nutrition, social isolation and many more
    broad categories would allow physicians to better assess the whole
    patient. Further, healthcare providers would be able to use these codes
    to document when a patient may benefit from a social service such as
    better access to transportation or access to nutrition services. For
    example, if a patient does not have a means of transportation or cannot
    afford to pay for transportation to a breast cancer screening center,
    the probability is high that this screening will not occur. The
    implementation of new ICD-10 codes for social determinants of health
    would help manage these types of situations to drive better patient
    engagement, care, and outcomes.

    It is imperative that Congress and CMS continue to work closely with
    private-sector health leaders during MACRA implementation. The law
    provides CMS with an unprecedented ability to transform healthcare
    delivery through incentives. These changes, which will have far-
    reaching and significant effects on consumers nationwide, should be
    validated by healthcare experts across the healthcare system. These
    changes must be deliberate, transparent, and allow for meaningful
    collaborative efforts. Similarly, we urge the federal government to
    provide clear, concise, and actionable feedback on a timely and regular
    basis to allow providers to improve the quality of care delivered to
    patients and enhance program performance.

    Thank you for examining this important issue and please feel free to
    reach out to Tina Grande, Senior Vice President for Policy, at (202)
    449-3433 or tgrande@hlc.org with any questions.

    Sincerely,

    Mary R. Grealy
    President

                                     ______

                      Medical Group Management Association
    The Medical Group Management Association (MGMA) commends the Senate
    Finance Committee for convening this hearing on ``Medicare Physician
    Payment Reform After Two Years: Examining MACRA Implementation and the
    Road Ahead.'' MGMA is the premier association for professionals who
    lead medical practices. Since 1926, through data, people, insights, and
    advocacy, MGMA empowers medical group practices to innovate and create
    meaningful change in healthcare. With a membership of more than 45,000
    medical practice administrators, executives, and leaders, MGMA
    represents more than 12,500 practices of all sizes, types, structures,
    and specialties that deliver almost half of the healthcare in the
    United States.

    Through repealing the problematic sustainable growth rate and retiring
    an overly complex and duplicative hodgepodge of quality reporting
    programs, the Medicare Access and CHIP Reauthorization Act (MACRA)
    charted a value-based trajectory for the Medicare payment system by
    valuing innovative, patient-centric, and efficient care delivery over
    check-the-box bureaucracy.

    We appreciate this Committee's oversight efforts to ensure successful
    implementation of MACRA's sweeping payment reforms. We also applaud
    Congress for making technical corrections to MACRA through the
    Bipartisan Budget Act of 2018, another example of its continued support
    for the innovative care delivery improvements taking place in physician
    group practices across the country.

    Since MACRA passed, MGMA has partnered with Congress and the
    Administration to help practices succeed in the Quality Payment Program
    (QPP). We have hosted numerous educational events that connect our
    members directly with Centers for Medicare and Medicaid Services (CMS)
    staff, developed informational and educational resources related to the
    Merit-based Incentive Payment System (MIPS) and alternative payment
    models (APMs), and provided suggestions on how to improve the current
    program to policymakers based on feedback from our members.

    At this critical juncture in Medicare's transition from fee-for-service
    toward value-based reimbursement, Congress has an opportunity to make
    refinements to the program that would align it more closely with the
    original intent of MACRA. We hope these comments will help guide the
    Committee as it seeks to improve the QPP, align it more closely with
    congressional intent in MACRA to improve physician payment, and ensure
    a successful transition to a new Medicare payment system centered
    around high-value care.

    Continue the 0.5 Percent Medicare Payment Update Beyond CY 2019

    MACRA stabilized annual updates under the Physician Fee Schedule (PFS)
    and is a vast improvement to the previous, draconian sustainable growth
    rate methodology. Under MACRA, PFS payment updates increased by 0.5
    percent between 2015-2018, 0.25 percent in 2019, and then will be
    frozen for 6 years between 2020-2025.

    As the healthcare community transitions toward a value-based payment
    environment, fee-for-service does not need to be abandoned entirely,
    but it does need to be updated appropriately. Physician practices face
    a challenging environment with escalating costs, flat reimbursement
    updates, and an increasingly complex regulatory environment. To
    continue supporting these practices as they implement the changes
    necessary to ensure success in new delivery models, MGMA urges Congress
    to continue the stability in physician payments by extending the 0.5
    percent adjustment to the conversion factor beyond CY 2019.

    Encourage the Development and Availability of Physician-Focused APMs

    MGMA strongly supports efforts to advance value-based care delivery
    through APMs that reward high quality and efficient care delivery. MGMA
    agrees with Congress that the APM pathway is a promising door to value-
    based reimbursement without imposing undue administrative burden. We
    are encouraged by CMS' recent efforts to implement new primary care
    APMs through the Primary Care First and Direct Contracting models.\1\
    ---------------------------------------------------------------------------
        \1\ ``HHS to Deliver Value-Based Transformation in Primary Care,''
    HHS Newsroom (April 22, 2019).

    Despite this progress, however, the healthcare system is still learning
    how to effectively transform care delivery. We are now past the 3-year
    mark for implementation of MACRA, yet there are still limited
    opportunities for physician practices to participate in an APM,
    particularly those that qualify as ``advanced'' under CMS regulations.
    CMS estimates that less than 220,000 clinicians will become qualifying
    participants in Advanced APMs this year, compared to the 798,000
    clinicians expected to participate in MIPS.\2\ Many practices are
    interested in joining an APM, but are unable to do so because there are
    not viable options for practices of their size, specialty, or location.
    In a 2018 survey of MGMA members, 55% of over 400 respondents reported
    that Medicare does not offer an Advanced APM that is clinically
    relevant to their practice.\3\
    ---------------------------------------------------------------------------
        \2\ 83 Fed. Reg. 59452, 59721 (November 23, 2018).
        \3\ ``MGMA 2018 Regulatory Burden Survey'' (October 2018).

    Congress established the Physician-focused Payment Model Technical
    Advisory Committee (PTAC) to leverage private sector development and
    expedite the availability and implementation of APMs. Dozens of APMs
    have been submitted to PTAC, however CMS has yet to implement or test
    on a limited scale any of the models recommended by PTAC. We urge
    Congress to direct the Administration to be more collaborative with
    PTAC, including testing and adopting new physician-
    focused payment models.

    Extend the APM Bonus Beyond CY 2024 When it Currently Expires

    MGMA appreciates Congress' work to support physician practices
    transitioning to value-based payment in Medicare by providing
    incentives to participate in APMs, including a five percent bonus
    payment for significant participation in APMs. This five percent bonus
    is a powerful incentive for practices to participate in APMs, but it is
    set to end in 2024. Momentum toward practice participation in these
    value-based models could be lost without this support. We urge Congress
    to consider extending the availability of the five percent payment to
    continue incentivizing practices to participate in APMs as more models
    are developed that may offer practices an opportunity to participate in
    an APM for the first time.

    Furthermore, the five percent bonus is not only an incentive to
    participate in an APM, it also lends financial support to practices
    incurring extra expenses when making the transition into a new care
    delivery model, which may include start-up costs, hiring and training
    additional support staff, making technology upgrades, and the use of
    time and resources for high-value, yet non-covered, services.

    We share Congress and the Administration's goal of expediting the
    process for physician practices to participate in APMs and believe an
    important step to achieving this goal is to extend the availability of
    the five percent incentive payment beyond 2024 when it is currently set
    to expire, so that group practices have the opportunity to receive the
    support Congress intended.

    Modify the APM Risk Standard

    We recommend modifying the APM financial risk standard to account for
    start-up costs as well as ongoing expenses incurred by a group practice
    as they participate in an APM. Start-up costs alone can easily exceed
    millions of dollars by CMS' own estimates, and these amounts should be
    counted towards an APM's nominal amount standard. Incorporating these
    financial risks could lead to many more APMs entering this track of
    MACRA and additional APMs finally being recognized for the very
    tangible risk they are assuming.

    Modernize Antiquated Fee-for-Service Policies That Undercut Value-Based
                        Transformation

    As practices explore new payment models, they face outdated payment
    requirements and fraud and abuse rules that hinder their ability to
    coordinate care. To allow for greater care coordination within the
    construct of APMs, MGMA recommends that Congress assess and modify the
    existing physician self-referral (Stark Law) prohibition and/or create
    new waivers for APM participants from certain fraud and abuse rules and
    payment requirements.

    There is a growing consensus supporting the expeditious modernization
    of existing fraud and abuse rules, such as the Stark Law and Anti-
    Kickback Statute (AKS). While well-intended, the Stark Law and AKS are
    broadly construed such that they effectively prohibit or introduce
    uncertainties regarding clinical and financial integration arrangements
    that have the potential to improve care for patients.

    Congress has recognized the incongruity between the current fraud and
    abuse framework and the development and implementation of APMs and
    other value-based payment arrangements. Congress authorized the
    Administration to issue waivers for select programs, such as those
    created through the Center for Medicare and Medicaid Innovation (CMMI)
    and for accountable care organizations in the Medicare Shared Savings
    Program. Waivers do not offer sufficient protection, however, as they
    are issued on a case-by-case basis, are limited in duration, and only
    protect arrangements within specific programs. Uncertainty about the
    application of fraud and abuse rules, and potential for severe
    penalties for any violation, have had a chilling effect on innovation
    and slowed the progression toward cost-efficient,
    quality-driven models.

    As the healthcare industry transitions to a value-driven payment
    environment, we urge Congress to enact legislation that modernizes
    these outdated rules and creates flexible waivers for APMs, which are
    already held accountable for utilization and quality of care as
    inherent aspects of model design. Congress should pass the Medicare
    Care Coordination Improvement Act (S. 966/H.R. 2282), which would
    expand the Secretary's fraud and abuse exception and waiver authority
    and remove the ``volume or value'' prohibition in Stark Law to
    facilitate the development and operation of APMs. Additionally, we
    support broader reforms, such as eliminating the compensation prong
    from the Stark Law to return its focus to governing ownership
    arrangements.

    Lastly, we recommend the Committee reevaluate the usefulness of out-of-
    date billing requirements for telehealth and other high value services.
    This is particularly important for APMs, which are held accountable for
    total cost of care and should not be subject to a duplicative set of
    requirements.

    Streamline and Simplify MIPS Reporting Requirements

    As medical group practices transition to value-based payment to improve
    the delivery of health care, they are hamstrung by burdensome and
    outdated government mandates that impede innovation, drive up costs,
    and ultimately redirect resources away from patients. Through its
    oversight authority, Congress should ensure CMS does more to streamline
    and significantly simplify reporting requirements and scoring for MIPS.
    CMS should reduce the overall number of measures required for full
    participation in MIPS and use a flexible set of measures that are
    proven to be statistically reliable, clinically valid, outcomes-
    focused, and, most importantly, patient-centered. Furthermore, CMS
    should base MIPS point values for individual measures on their relative
    value to the total MIPS score.

    Minimizing regulatory burden to the greatest extent possible, such as
    burdens related to quality reporting requirements, allows physician
    practices to allocate more time toward improving patient care. To
    assist CMS in resetting its approach and achieving its stated goals of
    reducing clinician burden in MIPS and enhancing patient care, MGMA
    encourages Congress to instruct CMS to make the following high-impact
    improvements to MIPS:

          Decrease the number of measures across MIPS. Physician group
    practices' finite resources are spread across a minimum of nearly 20
    measures required to meet MIPS requirements. CMS should structure MIPS
    to allow practices to prioritize effective and impactful improvements
    to patient care, rather than comply with sprawling reporting mandates.

          Significantly simplify the scoring scheme. CMS should simplify
    the overall MIPS scoring structure by basing point values for
    individual measures on their relative value to the total MIPS score.

          Increase CMS' flexibility to appropriately score MIPS
    performance. On top of simplifying the overarching scoring scheme of
    MIPS, Congress should add legislative language to MACRA to increase
    flexibility in MIPS scoring methodology to expressly allow CMS to
    provide clinicians and group practices with credit across categories
    for performing certain activities that touch on multiple MIPS
    categories. For instance, reporting quality measures via certified EHR
    technology should count toward fully meeting the promoting
    interoperability category, rather than merely toward bonus points.

          Do not prematurely measure cost. Many features of the cost
    performance category are still unfinished. Currently, CMS is
    overhauling two MIPS cost measures to address longstanding, significant
    concerns related to flawed attribution and insufficient risk adjustment
    methodologies; adding new condition-based measures; and testing patient
    relationship codes. Group practices should not be evaluated on measures
    with unresolved methodological flaws. While CMS continues to fine-tune
    the cost component of MIPS, Congress should encourage the agency to
    weight the cost category to ten percent to allow sufficient time to
    significantly overhaul existing cost measures. CMS' own data has shown
    that the current methodology discriminates against physicians who treat
    the sickest patients. The agency needs time to develop better risk
    adjustment and attribution methodologies. It is crucial for CMS to
    understand the complexities of patient attribution and take this
    opportunity to fully test any new code set, such as the patient
    relationship codes required under MACRA, to ensure the agency achieves
    the desired outcome of appropriately assigning costs to providers who
    have control over the care.

          Provide clear and actionable feedback about MIPS performance at
    least every calendar quarter, as recommended by the statute. Without
    timely feedback, MIPS is essentially a reporting exercise that enters
    data into a ``black box'' only understood by CMS, rather than a useful
    barometer practices can leverage to drive clinical improvement.

    Conclusion

    Thank you for the opportunity to share our comments regarding
    implementation of MACRA. MGMA stands ready to work with Congress, the
    Administration, and other stakeholders in ensuring MACRA supports
    physician practices' transition to value-based care delivery models by
    reducing administrative burden, improving the clinical relevance of
    MIPS, increasing opportunities to move into APMs, and modernizing
    outdated federal rules impeding care coordination. Should you have any
    questions, please contact Mollie Gelburd at mgelburd@mgma.org or 202-
    293-3450.

                                     ______

                 Medicare Payment Advisory Commission (MedPAC)

                          425 I Street, NW, Suite 701

                              Washington, DC 20001

                                  202-220-3700

                               Fax: 202-220-3759

                                 www.medpac.gov

    The Medicare Payment Advisory Commission (MedPAC) is a small
    congressional support agency established by the Balanced Budget Act of
    1997 (Pub. L. 105-33) to provide independent, nonpartisan policy and
    technical advice to the Congress on issues affecting the Medicare
    program. The Commission's goal is a Medicare program that ensures
    beneficiary access to high-quality, well-coordinated care; pays health
    care providers and health plans fairly, rewarding efficiency and
    quality; and spends taxpayer and beneficiary dollars responsibly. The
    Commission thanks Chairman Grassley and Ranking Member Wyden for the
    opportunity to submit a statement for the record today.

    Background

    Physicians and other health professionals billing under Medicare's fee
    schedule deliver a wide range of services--office visits, surgical
    procedures, and diagnostic and therapeutic services--in a variety of
    settings. The Medicare program paid $69.1 billion for physician and
    other health professional services in 2017, or 14 percent of benefit
    spending in Medicare's traditional fee-for-service (FFS) program. In
    2017, about 985,000 health professionals billed Medicare through the
    fee schedule--roughly 596,000 physicians and 389,000 nurse
    practitioners, physician assistants, therapists, chiropractors, and
    other practitioners (Medicare Payment Advisory Commission 2019).

    Medicare's fee schedule payment rates are based on the clinician work
    required to provide the service, expenses related to maintaining a
    practice, and expenses related to professional liability insurance.
    From 1999 to 2015, updates to these payment rates were governed by the
    sustainable growth rate (SGR) system, which set updates so that total
    spending would not increase faster than a target--a function of input
    costs, FFS enrollment, gross domestic product (GDP), and changes in law
    and regulation. Because annual spending generally exceeded these
    parameters, payments to clinicians were scheduled to be reduced by
    ever-growing amounts starting in 2002. The Congress overrode these
    negative cuts in all but the first year they were scheduled. Because of
    these overrides and volume growing in excess of per capita GDP, the
    resulting scheduled payment rate reduction was expected to be 21
    percent in 2015, creating considerable tension for clinicians and the
    Medicare program. The Medicare Access and CHIP Reauthorization Act of
    2015 (MACRA) repealed the SGR system and created a fixed set of
    statutory updates for clinicians.

    MACRA also included two other major provisions--an incentive payment
    for qualifying participants in advanced alternative payment models (A-
    APMs) and the Merit-based Incentive Payment System (MIPS). From 2019
    through 2024, clinicians who are qualifying participants in an A-APM
    receive incentive payments of 5 percent of their Medicare-covered
    professional services revenue each year that they qualify. MACRA's
    incentive payments for clinicians participating in A-APMs were intended
    to encourage clinicians to move toward these models. A-APMs generally
    require participating entities to assume financial risk for their
    patients, which creates incentives for providers to improve care
    coordination and quality while controlling cost growth. Unless
    otherwise exempted, clinicians who are not qualifying participants in
    an A-APM and meet certain thresholds for Medicare participation are
    required to participate in MIPS. MIPS is a system that calculates
    individual clinician-level or group-level payment adjustments based on
    four areas: (1) quality and advancing care information, (2) meaningful
    use of electronic health records, (3) clinical practice improvement
    activities, and (4) cost. Based on the clinicians' performance in these
    four areas, the payments they receive from Medicare can be increased or
    decreased by varying amounts over time. The basic MIPS payment
    adjustments are budget neutral, but MACRA also appropriated an
    additional $500 million in bonuses for exceptional performance in MIPS
    each year from 2019 to 2024.

    (The Commission has commented extensively on A-APMs and MIPS. For more
    background on these topics, see the Commission's annual reports and
    comment letters referenced at the end of this document).

    The Commission Supports Repeal of the Sustainable Growth Rate System

    The Commission had long supported repealing the SGR and commends the
    Congress for doing so (Medicare Payment Advisory Commission 2011,
    Medicare Payment Advisory Commission 2018b). The SGR failed to restrain
    volume growth under the fee schedule and, in fact, may have exacerbated
    it. Although the pressure of the SGR likely minimized fee increases
    while in effect, it disproportionally affected clinicians who have less
    ability to increase volume, such as primary care providers.
    Additionally, both the magnitude of the threatened cuts and the
    temporary policies to override the SGR engendered uncertainty among
    clinicians, which in turn may have caused anxiety among beneficiaries.
    For these reasons, the Commission believes that repealing the volume-
    based approach to clinician payment was warranted. The MACRA approach
    of tying payments to clinicians' performance, through comprehensive,
    patient-centered care delivery models, provides better incentives for
    clinicians and could ideally result in better care and outcomes for
    Medicare beneficiaries.

    Implementing Advanced-Alternative Payment Models

    MACRA established the A-APM incentive payment to spur reform in the
    delivery of health care by encouraging clinicians to move toward these
    models, in which providers take accountability for health care spending
    and quality. A-APMs are defined in statute based on three criteria:

        1.  The model requires use of certified electronic health record
    technology.

        2.  The model makes payments based on a set of quality measures
    comparable with MIPS.

        3.  The model requires the entity to bear financial risk under such
    alternative payment model in excess of a nominal amount or to be a
    medical home expanded under Section 1115A(c) (Medicare Payment Advisory
    Commission 2016b).

    The Commission generally supports the establishment of A-APMs and other
    elements of MACRA that are designed to move clinicians toward
    comprehensive,
    patient-centered care delivery models. These models can help counter
    the incentives in traditional FFS, which reward volume and thus can
    lead to higher spending for the Medicare program and for beneficiaries.
    The Commission holds that it is important to encourage providers to
    take accountability for the cost of health care and for quality
    outcomes, and it has long recognized the limitations of traditional
    FFS.

    Effective A-APMs should encourage delivery system reform that results
    in beneficiaries having access to high-quality health care services and
    a sustainable Medicare program. To help the Centers for Medicare and
    Medicaid Services (CMS) implement A-APMs in a way that achieves that
    goal, in June 2016 the Commission established the following set of
    principles to help inform how A-APMs should be defined (Medicare
    Payment Advisory Commission 2016b):

          Clinicians should receive an incentive payment only if the A-APM
    entity in which they participate (e.g., an accountable care
    organization (ACO)) is successful in controlling cost, improving
    quality, or both.\1\
    ---------------------------------------------------------------------------
        \1\ Clinicians are participants in A-APM entities. The A-APM entity
    is a participant in a qualifying model.

          The A-APM entity should be at financial risk for total Part A
    ---------------------------------------------------------------------------
    and Part B spending.

          The A-APM entity should be responsible for a beneficiary
    population sufficiently large to detect changes in spending and
    quality.

          The A-APM entity should have the ability to share savings with
    beneficiaries.

          CMS should give A-APM entities certain regulatory relief.

          Each A-APM entity should assume financial risk and enroll
    clinicians.

    While the statute contains some guidance for the models CMS should
    consider as A-APMs for purposes of the 5 percent incentive payment, the
    agency has considerable flexibility in making that determination. CMS
    began deciding which models qualified as A-APMs beginning in 2017, and
    the number has increased each year to 13 models in 2019 (Centers for
    Medicare and Medicaid Services 2018a).

    Some A-APMs align relatively well with the Commission's principles for
    A-APMs. One type of A-APM that the Commission has generally supported
    is an ACO model that features two-sided financial risk, meaning that
    providers share in savings or losses based on beneficiaries' actual
    spending relative to what was expected. The Next Generation
    (``NextGen'') ACO model is an example. It began in 2017, and
    participating providers agree to take responsibility for the overall
    cost and quality of medical care for a population of beneficiaries.
    This model has strong incentives for providers to improve quality and
    control the overall cost of care for attributed beneficiaries, and it
    generally aligns with our principles. The most recent evaluation of the
    program found that in its first year the NextGen program reduced
    Medicare spending for beneficiaries by 1.7 percent before taking into
    account shared savings paid to the ACOs (and losses paid to Medicare by
    ACOs) (NORC at the University of Chicago 2018). After shared savings
    and losses are taken into account, the NextGen demonstration saved 1.1
    percent. Most quality measures did not show statistically significant
    changes.

    Recently the Commission conducted an analysis to measure the
    performance through 2016 of the Medicare Shared Savings Program (MSSP),
    the largest ACO program in Medicare. Almost all of the ACOs in the MSSP
    during this time did not face two-sided financial risk, and thus had
    weaker incentives than ACOs in the NextGen program. We concluded that
    the MSSP resulted in spending growth from 2012 to 2016 that was 1 or 2
    percentage points lower than spending growth would have been without
    the program. However, that was before payments to ACOs for shared
    savings, and actual savings realized by the Medicare program were thus
    lower. Models incorporating two-sided risk, like NextGen, have stronger
    incentives for achieving better cost and quality outcomes and align
    most closely with our principles.

    In contrast, some A-APMs do not align well with our principles. For
    example, the Commission has expressed concerns about the Comprehensive
    Primary Care Plus (CPC+) model being designated as an A-APM, in part
    because providers could join without assuming enough financial risk to
    change incentives for delivering care (Medicare Payment Advisory
    Commission 2016a). In CPC+, providers get additional payments in the
    form of monthly fees and awards based on performance. These additional
    dollars are intended to help primary care practices coordinate care to
    improve quality and reduce spending. However, participants in CPC+ only
    face financial risk for these additional payments, and not on their FFS
    revenue. The Commission has expressed concern that A-APMs with low
    standards for financial risk may attract providers interested in
    gaining the incentive payment and not in changing care delivery.

    In April 2019, CMS posted performance results from the first year of
    CPC+. Overall, the evaluation found that practices participating in
    CPC+ tended to have FFS spending that was 2 to 3 percent higher than
    comparison practices, after accounting for enhanced payments. These
    results illustrate the risks to the Medicare program and taxpayers of
    having A-APMs that are not designed with robust incentives (Centers for
    Medicare and Medicaid Services 2019).

    Ideas for Improving A-APMs

    A key policy choice is whether to have more A-APM participants in
    models with weaker incentives, or fewer A-APM participants in models
    with stronger incentives. The Commission's goal is for Medicare to
    design efficient A-APMs that create real value for beneficiaries, the
    Medicare program, and taxpayers, not to maximize the number of
    providers that can join A-APMs. Thus, it is important for policymakers
    to continue improving A-APMs in order to increase their likelihood of
    success. To help in that effort, the Commission has discussed several
    policies that could improve A-APMs. These policies are focused on
    strengthening incentives for providers to change practice patterns,
    reducing burden and uncertainty, and sending consistent signals
    throughout the Medicare program for how providers and other entities
    will be measured on cost and quality.

    Maintain High Standards for Financial Risk

    CMS should only approve A-APMs with high standards for financial risk.
    As noted above, without high standards for financial risk, A-APMs may
    attract providers who see the model primarily as a means for gaining
    incentive payments, and who may be less focused on changing care
    delivery. This would increase spending for the Medicare program and
    beneficiaries, without providing real value.

    Use Prospective Attribution in ACOs

    Starting in June 2019, MSSP ACOs (some of which are A-APMs) will be
    given the ability to choose, each year, whether to have their
    beneficiaries assigned prospectively or retrospectively. This creates
    risk for the program because it could encourage patient selection.
    Prospective assignment means that beneficiaries are assigned to an ACO
    based on which providers they saw in the previous year. Retrospective
    assignment means that beneficiaries are assigned to an ACO based on the
    providers they saw in the current year. There are strengths and
    weaknesses to both approaches, but, on balance, prospective assignment
    has several advantages. ACOs know with certainty who their assigned
    beneficiaries are at the beginning of the year, and thus can better
    target their efforts to improve care. Also, when an ACO knows in
    advance who its beneficiaries are, the program is able to relax
    regulations and give greater flexibility to the ACO (e.g., by allowing
    a waiver from the requirement that a beneficiary have a 3-day hospital
    stay before being admitted to a SNF). Prospective assignment also
    reduces problems of patient selection that may arise through
    retrospective assignment. Under retrospective assignment, ACOs can take
    actions during a performance year to influence which patients are
    assigned to them. For example, toward the end of the year, an ACO could
    encourage patients with little service use to have an annual wellness
    visit (AWV) with an ACO clinician so that low-spending patients would
    be assigned to the ACO. Alternatively, an ACO could encourage patients
    to see non-ACO doctors if they have an anticipated need for an
    expensive procedure such as a knee replacement. These selection issues
    are less of a problem under prospective assignment because it is more
    difficult to predict a patient's spending in a future year than in the
    current year, and the ACO is responsible for the patient's spending
    during the entire year regardless of where the patient gets care.

    Measure Quality Consistently Across Medicare

    To reward accountable entities and providers for offering high-quality
    care to beneficiaries, A-APMs should be designed to link payment to
    quality of care. However, the ACO program used 32 quality measures in
    2018, including some process measures with an unclear link to patient
    health outcomes. Using so many measures is burdensome to ACO
    participants and makes it difficult to draw comparisons with providers
    in other parts of Medicare that use different quality measures. The
    Commission asserts that Medicare quality incentive programs should use
    a small set of outcomes, patient experience, and value measures to
    assess the quality of care across different populations, such as
    beneficiaries enrolled in Medicare Advantage (MA) plans, ACOs, and FFS
    in defined market areas, as well as those cared for by specified
    hospitals, groups of clinicians, and other providers (Medicare Payment
    Advisory Commission 2018a).

    A consistent set of population-based measures will allow policymakers
    to compare quality across different accountable entities and providers
    in the Medicare program. This would also provide information to the
    program to better reward high-quality providers, and to beneficiaries
    to inform decisions of where to get care. Sending consistent signals
    across the program could also help providers focus their quality
    improvement activities on improving patient outcomes.

    Continue Improving FFS

    Although A-APMs represent a significant opportunity to encourage
    delivery system reform and to move the Medicare program to paying for
    value, it is important to remember that these payment models largely
    rely on the Medicare FFS system to operate underneath them. That is, in
    most A-APMs, providers still submit FFS claims and are paid FFS rates.
    Therefore, it is crucial that the FFS payment systems be continually
    maintained and improved so that they function smoothly and, to the
    extent possible, do not create conflicting incentives.

    Moving Beyond the Merit-based Incentive System (MIPS)

    MedPAC shares Congress's goal, expressed in MIPS, of having a value
    component for clinician services in traditional Medicare that promotes
    high-quality care. However, MedPAC believes that MIPS, as currently
    structured, cannot achieve this goal and, therefore, should be replaced
    with a better quality payment program (Medicare Payment Advisory
    Commission 2018b). The Commission did not reach this conclusion
    hastily. We first examined options for improving MIPS as it was
    implemented, and we have provided feedback as CMS established rules for
    the first three years of the program (Medicare Payment Advisory
    Commission 2016a, Medicare Payment Advisory Commission 2017). However,
    as we continued to explore MIPS in a deliberative process laid out in
    several Commission reports to the Congress, we came to the conclusion
    that the basic design of MIPS is fundamentally flawed. For a number of
    reasons, MIPS will not succeed in helping beneficiaries choose
    clinicians, in helping clinicians change practice patterns to improve
    value, or in helping the Medicare program reward clinicians based on
    the value of the care they provide.

    First, information collected under MIPS is unlikely to be meaningful
    because the MIPS measures are variable in application, clinical
    appropriateness, and association with meaningful outcomes. Under MIPS,
    each clinician's quality score is based on six measures chosen by the
    clinician from a set of several hundred predominantly process measures.
    To measure all or most medical and surgical specialties at the
    individual level, as the MIPS program is designed, there needs to be a
    wide variety of clinical process measures, including those relevant to
    each specialty. Therefore, when clinicians are compared with each other
    nationally to determine Medicare payments, the comparison is on wholly
    different measures. This will likely lead to substantial inequities
    over time and to the ultimate rejection of the program as unfair. The
    Commission supports providers using additional measures, such as care
    process measures, to manage their own quality improvement. However,
    these measures should not be tied to Medicare payments through quality
    incentive programs.

    Second, few individual clinicians manage a sufficient number of
    discrete beneficiary medical issues and resultant processes of care
    during a year to produce reliable, statistically significant
    comparative results (the ``small numbers'' problem). Although some
    clinicians may furnish services at volumes large enough to be
    accurately measured, they are too few to build a comprehensive program
    that is broadly accurate and equitable across clinicians. In the third
    year of the program, CMS plans to exclude about 45 percent of
    clinicians from the MIPS program because they do not meet group
    eligibility or fall below the low-volume threshold (Centers for
    Medicare and Medicaid Services 2018b).

    Third, adjusting payment based on quality and efficiency measured at
    the individual clinician level belies the reality of modern medicine.
    Medicine is increasingly provided by care teams. Although there are
    clearly examples of how the actions of one clinician alone are
    critically important to quality outcomes, the preponderance of care
    experienced by most Medicare beneficiaries is the result of the actions
    of multiple clinicians and institutions. The Commission believes that
    coordinating care over time and across settings is one important key to
    a more effective and efficient Medicare program of the future.
    Measuring clinicians individually and on their own chosen measures
    undermines incentives to coordinate care broadly across the Medicare
    program.

    Fourth, requiring clinicians to report annually multiple measures to
    CMS is burdensome, complex, and expensive. For 2017 (the first year of
    reporting under MIPS), CMS estimated that the cost for providers to
    comply with MIPS was more than $1.3 billion (Centers for Medicare and
    Medicaid Services 2016). CMS estimated that MIPS would require
    approximately $700 million in reporting costs in 2018 (Centers for
    Medicare and Medicaid Services 2017). For 2019, CMS did not provide a
    summary estimate for reporting costs (Centers for Medicare and Medicaid
    Services 2018b). Clinicians have already spent a substantial amount of
    financial resources and time to implement MIPS, and they will continue
    to do so. This is time and money that could be better devoted to
    patient care.

    MIPS Is Not Succeeding

    Based on the flaws in the design of MIPS, we expected that MIPS-based
    payment adjustments would be small in the first years of the program,
    providing little incentive for clinicians to improve. This expectation
    was confirmed by CMS's first year MIPS performance data, which showed
    that the maximum MIPS bonus a clinician receives in 2019 is 0.22
    percent. When the exceptional performance bonus is added, the maximum
    total bonus is 1.88 percent.

    Almost all (93 percent) of clinicians who participated in MIPS are
    receiving a small positive adjustment in 2019 based on their 2017
    performance (Medicare Payment Advisory Commission 2019). Seventy-one
    percent of the clinicians qualified for a positive adjustment plus an
    exceptional performance bonus. CMS estimates that this trend will
    continue in payment year 2021, with about 90 percent of participating
    clinicians receiving a MIPS bonus and about 60 percent receiving an
    additional exceptional performance bonus (Centers for Medicare and
    Medicaid Services 2018b). Most participating clinicians receive a
    positive payment because of a number of policy decisions CMS has made
    to reflect a phased approach to MIPS implementation, which CMS refers
    to as ``Pick Your Pace.'' Specifically, CMS used its regulatory
    authority to:

          Set the MIPS performance threshold at 3 points (out of 100) for
    payment year 2019. Clinicians with a score above 3 are to receive a
    neutral or positive payment adjustment, and clinicians with a score of
    3 or below are to receive a negative payment adjustment. For payment
    year 2021, CMS has changed the performance threshold from 3 to 30
    points.

          Set the MIPS exceptional performance bonus threshold at 70
    points (out of 100) for payment year 2019 and 75 points for payment
    year 2021.

          Permit clinicians to meet the 3-point MIPS performance threshold
    by reporting minimal information on one quality measure (or attesting
    to one performance activity) in 2019.

          Weight the cost component at 0 points, so costs (i.e., resource
    use) do not affect MIPS payment adjustments in the first year. Costs
    account for 15 percent of the total performance score in year 3.

    Because clinicians could choose which measures to report, most
    clinicians had very high performance scores overall in the first year
    of the program. Specifically, the mean performance score was 74 points,
    and the median performance score was 89 points, well in excess of the
    3-point threshold for a positive adjustment and the 70-point threshold
    for the exceptional performance bonus.

    Under the statute, performance thresholds will eventually be set at the
    mean or median of clinician performance, and payment adjustments will
    increase substantially to 9 percent. Because clinicians will still be
    able to select the measures on which they expect to perform well, MIPS
    scores will continue to be very high and compressed around a high
    average. This means that small changes in scores will result in very
    large and unpredictable swings in payment adjustments, creating greater
    uncertainty and inequity, and potential rejection of the program by
    large numbers of clinicians.

    The MIPS program is not succeeding in its goals of rewarding and
    penalizing clinicians based on performance. Subsequent legislation has
    delayed implementation of the higher performance thresholds to 2022.
    The Commission urges policymakers to use the intervening years to begin
    developing an alternative approach to measuring and rewarding value in
    clinician payment.

    A New Direction for Rewarding Clinician Quality: A Voluntary Value
    Program

    While the Commission believes MIPS is fundamentally flawed, we do
    believe that traditional Medicare FFS clinician payment should have a
    value-based payment component. Thus, we also recommended creating a new
    clinician value-based purchasing program--a voluntary value program, or
    VVP--to take its place (Medicare Payment Advisory Commission 2018b).
    The VVP recommendation reflects a conceptual direction (not yet a
    detailed design) for rewarding clinician quality in FFS Medicare
    according to the core quality principles developed by the Commission;
    future Commission work will explore more detailed specifications for a
    VVP.

    The VVP would incorporate the Commission's quality measurement
    principles by measuring groups of clinicians (rather than individual
    clinicians, to address the ``small numbers'' problem) on a small set of
    population-based metrics--that would include measures such as
    readmission to the hospital and patient experience--that are important
    to the program and its beneficiaries, can be measured reliably, and can
    be applied across payment models and providers (Medicare Payment
    Advisory Commission 2018a). These types of measures would recognize
    that all clinicians have a role in affecting the health outcomes of
    their patients. The data required to calculate the measures would be
    generated from claims or surveys, substantially reducing clinicians'
    reporting burden. Moreover, this approach aims to align measures for
    clinicians with measures we have suggested CMS use in its other quality
    programs, creating the potential to send clear, transparent, and
    consistent signals to providers in all sectors. Participation in the
    program would be voluntary, and clinicians would elect their own group
    (e.g., independent practice associations, organized hospital medical
    staffs, or local medical societies), which could include specialists as
    well as primary care clinicians.

    The VVP would encourage clinicians to think about how the care they
    provide contributes to the overall health outcomes of their patients,
    while also providing a transition for those who want to join A-APMs.
    This new direction would encourage care coordination among clinicians,
    focus quality improvement efforts on measures that are important to
    beneficiaries and Medicare, and relieve individual providers of the
    significant reporting burdens they face today and in the future. The
    VVP would also make quality measurement more equitable across different
    types of clinicians and improve the transparency of clinician quality
    of care for both the Medicare program and its beneficiaries.

    Conclusion

    MACRA made important improvements in how Medicare pays for clinician
    services. The Commission commends the Congress for repealing the SGR,
    which created uncertainty in Medicare payment for many years and
    contained poor incentives that rewarded volume of services. The
    Commission supports the elements of MACRA that move toward
    comprehensive, patient-centered care, including the establishment of A-
    APMs. However, the Commission urges the Congress to move past MIPS, as
    it will not accomplish the shared goal of motivating providers to
    improve performance on cost and quality. The Commission looks forward
    to continuing to be a resource for the Committee as it deliberates on
    policies to promote high-quality clinician care at lower costs to
    beneficiaries and the program.

    References

    Centers for Medicare and Medicaid Services, Department of Health and
    Human Services. 2016. 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. Final rule. Federal Register 81, no. 214 (November 4): 77008-
    77831.

    Centers for Medicare and Medicaid Services, Department of Health and
    Human Services. 2017. Medicare program; CY 2018 updates to the quality
    payment program; and quality payment program: Extreme and
    uncontrollable circumstance policy for transition year. Final rule with
    comment period. Federal Register 82, no. 220 (November 16): 53568-
    54229.

    Centers for Medicare and Medicaid Services, Department of Health and
    Human Services. 2018a. Advanced alternative payment models (APMs).
    https://qpp.cms.gov/apms/advanced-apms?py=2019.

    Centers for Medicare and Medicaid Services, Department of Health and
    Human Services. 2018b. Medicare program; revisions to payment policies
    under the physician fee schedule and other revisions to Part B for CY
    2019; Medicare Shared Savings Program requirements; Quality Payment
    Program; Medicaid Promoting Interoperability Program; Quality Payment
    Program--Extreme and Uncontrollable Circumstance Policy for the 2019
    MIPS payment year; provisions from the Medicare Shared Savings
    Program--Accountable Care Organizations--Pathways to Success; and
    expanding the use of telehealth services for the treatment of opioid
    use disorder under the Substance Use-Disorder Prevention That Promotes
    Opioid Recovery and Treatment (SUPPORT) for Patients and Communities
    Act Final rules and interim final rules. Federal Register 83, no. 226
    (November 23): 59452-60294.

    Centers for Medicare and Medicaid Services. 2019. Independent
    evaluation of Comprehensive Primary Care Plus (CPC+): First annual
    report. Report prepared by Mathematica for the Centers for Medicare and
    Medicaid Services. Baltimore, MD: CMS.

    Medicare Payment Advisory Commission. 2011. Moving forward from the
    sustainable growth rate (SGR) system. Letter to the Congress. October
    14.

    Medicare Payment Advisory Commission. 2016a. Comment on CMS's proposed
    rule on the Merit-based Incentive Payment System and alternative
    payment models, June 15. http://www.medpac.gov/docs/default-source/
    comment-letters/medpac-comment-on-cms-s-proposed-rule-on-the-merit-
    based-incentive-payment-system-and-alternative-pa.pdf?sfvrsn=0.

    Medicare Payment Advisory Commission. 2016b. Report to the Congress:
    Medicare and the health care delivery system. Washington, DC: MedPAC.

    Medicare Payment Advisory Commission. 2017. MedPAC comment on CMS's
    proposed rule on CY 2018 updates to the Quality Payment Program, August
    18.

    Medicare Payment Advisory Commission. 2018a. Report to the Congress:
    Medicare and the health care delivery system. Washington, DC: MedPAC.

    Medicare Payment Advisory Commission. 2018b. Report to the Congress:
    Medicare payment policy. Washington, DC: MedPAC.

    Medicare Payment Advisory Commission. 2019. Report to the Congress:
    Medicare payment policy. Washington, DC: MedPAC.

    NORC at the University of Chicago. 2018. First annual report: Next
    Generation Accountable Care Organization (NGACO) Model evaluation.
    Report prepared by staff from NORC at the University of Chicago for the
    Center for Medicare and Medicaid Innovation. Bethesda, MD: NORC.

                                     ______

                          National Association of ACOs

                      601 13th Street, NW, Suite 900 South

                              Washington, DC 20005

    We thank the committee for their work on the Medicare Access and CHIP
    Reauthorization Act of 2015 (MACRA) and for continuing to ensure the
    proper implementation of this landmark legislation. We appreciate the
    opportunity to provide comments on the recent Committee on Finance
    hearing, ``Medicare Physician Payment Reform After Two Years: Examining
    MACRA Implementation and the Road Ahead.''

    The National Association of ACOs (NAACOS) is the largest association of
    accountable care organizations (ACOs), representing more than 5 million
    beneficiary lives through 330 Medicare Shared Savings Program (MSSP),
    Next Generation Model, and commercial ACOs. NAACOS is an ACO member-led
    and member-owned nonprofit working on behalf of ACOs across the nation
    to improve the quality of Medicare, population health, outcomes, and
    healthcare cost efficiency. Our members want to see an effective,
    coordinated, patient-centric care process.

    The ACO model is a market-based solution to fragmented and costly care
    that empowers local physicians, hospitals, and other providers to work
    together and take responsibility for improving quality, enhancing
    patient experience, and reducing waste. The number of ACOs in Medicare
    has grown considerably in recent years and included nearly 650 ACOs in
    2018, covering 12.3 million beneficiaries. ACOs have been instrumental
    in the shift to value-based care and utilize cost-saving tools like
    telehealth to better reach their patient populations.

    Therefore, we feel it is critical that Congress continue to guide the
    effective implementation of MACRA and the Quality Payment Program (QPP)
    by strengthening the role of Alternative Payment Models (APMs) as a key
    piece of the transition to a value-based payment system. As the premier
    APM, ACOs are focused on population health for the totality of patients
    they serve. We therefore urge Congress and the Centers for Medicare and
    Medicaid Services (CMS) take steps to ensure that the ACO program
    remains a robust, successful participation option for Medicare
    providers navigating both value-based care and MACRA. Our specific
    recommendations are as follows:
    Quality Payment Program Recommendations

    1. Extend the Advanced APM 5% Bonus for an Additional 6 Years

    Eligible clinicians who participate in an Advanced APM \1\ and meet
    certain Qualifying APM Participant (QP) criteria will receive a 5%
    annual lump sum bonus from 2019-2024. Under the current statute, after
    2024, that bonus expires and QPs will instead only receive a 0.75%
    increase in Medicare Part B payments.\2\
    ---------------------------------------------------------------------------
        \1\ CMS identifies qualifying Advanced APMs annually. In 2019, CMS
    has identified 13 AAPMs. See CMS, ``Advanced Alternative Payment Models
    (APMs),'' available at https://qpp.cms.gov/apms/overview.
        \2\ The Medicare Access and CHIP Reauthorization Act of 2015
    (MACRA), Pub. L. 114-10(a)(2)(C)(20), enacted April 16, 2015.

    While CMS projections of the number of eligible clinicians that meet
    the QP criteria have increased with each year of the program, the
    number remains low. In fact, the number is lower than Congress
    envisioned in 2015 when MACRA was passed; in a 2015 CMS Office of the
    Actuary report, published shortly prior to the passage of MACRA; that
    office asserted that 60 percent of physician payment would be through
    Advanced APMs by 2019. The reality has been much slower: in the first
    year of the QPP, CY 2017, CMS predicted between 9-16% of all eligible
    clinicians to become QPs. For the third year of the QPP, CY 2019, CMS
    estimates that between 17-21% of eligible clinicians will be QPs. Given
    the slow implementation of Advanced APMs, we urge the extension of the
    5 percent Advanced APM bonus for an additional 6 years to encourage
    adoption.

    2. Lower or Remove the QP Thresholds

    To become a QP, an eligible clinician must receive at least SO percent
    of their Medicare Part B payments or see at least 35 percent of
    Medicare patients through an Advanced APM entity at one of three
    determination snapshots during the year. In addition, 75 percent of
    practices need to be using certified EHR Technology within the Advanced
    APM entity. While certain eligible clinicians may also become a QP
    through the ``All-Payer and Other Payer Option,'' which is a
    combination of Medicare and non-Medicare payer arrangements such as
    private payers and Medicaid, this option has not been widely utilized.
    The current and future QP thresholds are challenging for providers to
    meet, resulting in less participation in Advanced APMs. Many providers
    already have difficulty meeting the current percentage threshold, which
    increased in performance year 2019. The 75 percent threshold that goes
    into effect for performance year 2021 is far too high for continued
    widespread and meaningful participation and will undoubtedly preclude
    many providers from obtaining QP status. To continue to increase
    participation in Advanced APMs, we urge Congress to modify the
    statutory QP thresholds such that CMS has discretion to set thresholds
    OR modify the payment amount threshold to be set at a lower level.

    3. Address APM Overlap

    As more APMs are rolled out, APM overlap within markets and provider
    organizations has occurred more frequently, and we have observed
    confusion in the marketplace regarding which APMs providers may
    participate, and when. While some APMs can complement one another when
    it comes to improved quality and other outcome-based goals,
    participation in more than one APM can result in conflicting financial
    incentives that undermine the objectives of those already in existence.
    APM overlap also adds administrative complexity and dilutes the savings
    opportunities for those already on the forefront of care redesign.

    To address APM overlap, we recommend:

          i.  An independent review of all CMS APMs and how they overlap
    with one another, and a subsequent report back to Congress about APM
    overlap and how the agency is mitigating concerns related to overlap
    such that APMs support one another rather than conflict.

          ii.  CMS should be required to address how model overlap will
    work with each release of a new model. A market-driven approach should
    be prioritized, establishing methods for APMs to work together.

         iii.  CMS should be permitted to allow multiple program
    participants to keep the shared savings they have earned regardless of
    the existence of program overlap in instances where at least one of the
    programs is being tested by the Center for Medicare and Medicaid
    Innovation, under 1115A of the Social Security Act.

    4. Modify the All-Payer Combination Option

    The All-Payer Combination Option takes into account an eligible
    clinician's participation in Advanced APMs both with Medicare and other
    payers (including Medicare Advantage, Medicaid, and other commercial
    plans) when determining whether the eligible clinician meets the QP
    threshold. The All Payer Combination Option allows eligible clinicians
    to become QPs through participation in a combination of Advanced APMs
    and Other Payer Advanced APMs starting in the 2019 QP Performance
    Period. We recommend modifying the All-Payer Combination Option to be a
    Multi-Payer Combination Option to allow for increased participation of
    this option.

    As currently structured, CMS requires providers to submit detailed
    information on all payers with which they have contracts. While there
    are an increasing number of opportunities to work with payers outside
    of Medicare on value-based arrangements, many payers do not yet offer
    APMs that meet CMS's definition of an Advanced APM. Accordingly,
    providers do not have ample opportunity to receive additional credit
    for their participation with those payers that do offer Advanced APMs.
    Effectively, being required to submit information on all payers,
    regardless of whether they offer Advanced APM opportunities, waters
    down Advanced APM participation with those that do offer Advanced APMs.
    We do not believe Congress's intent was to structure the All-Payer
    Combination Option in this manner, which does not meaningfully reward
    Advanced APM participation outside of Medicare. CMS has explained that
    the statutory language does not allow them to provide credit for
    Advanced APM participation with some payers while not factoring in
    payers that do not offer Advanced APM arrangements.

    To remedy this problem, we urge Congress to modify the statute to base
    the All-Payer Combination Option on multiple payers without making
    providers have to meet a more difficult ``All-Payer'' threshold. This
    modification would change the All-Payer Combination Option to be
    additive in a way that it could only help APM entities meet QP
    thresholds when the entity is unable to do so strictly through Medicare
    APM participation.

    5. Exclude MIPS Payment Adjustments From ACO Expenditures

    NAACOS also continues to oppose the unfair policy whereby CMS counts
    MIPS payment adjustments as ACO expenditures. The current framework CMS
    has established will punish ACOs for their high performance in MIPS.
    NAACOS believes CMS should recognize all ACOs, including those in BASIC
    tracks, as Advanced APMs. However, because CMS continues to subject
    BASIC track Level A, B, C, and D ACOs to MIPS, these ACOs have no
    choice but to be evaluated under MIPS while continuing their focus on
    the ACO program goals. Most ACOs will perform very well under the
    established MIPS performance criteria and therefore earn bonuses under
    the program. These bonuses will then count against the ACO when
    expenditures are calculated for purposes of MSSP calculations.
    Therefore, the better an ACO and its clinicians perform in MIPS, the
    more they will be penalized when calculating shared savings for the
    ACO. This is an unfair and untenable policy, and CMS must modify its
    position to exempt MIPS payment adjustments as expenditures in the ACO
    program. CMS does make claim level adjustments by adding sequestration
    costs back to paid amounts when calculating ACO expenditures, therefore
    the Administration has the technical ability to make such a change. It
    was not the intent of Congress to penalize ACOs in MIPS, and therefore
    CMS must alter this policy to continue encouraging provider
    participation in the BASIC track of the ACO program. Therefore, we urge
    Congress to work with CMS to revise this flawed policy.

    6. Discontinue Delays to MIPS Implementation

    NAACOS is concerned that Congress and the Administration continue to
    make changes to MACRA to further dilute accountability for quality and
    cost performance for Medicare beneficiaries. In the Bipartisan Budget
    Act (BBA) of 2018, Congress provided CMS with additional flexibility to
    implement the performance standard for which clinicians were intended
    to be evaluated against. Additionally, the BBA included a provision
    allowing for CMS to further delay the incorporation of cost measurement
    in MIPS. Congress originally intended for cost to be a component of
    MIPS scores by 2021. CMS has already delayed incorporating cost in MIPS
    scores in 2019 and 2020 to provide clinicians with additional time to
    prepare. Further, for the 2018 performance year, CMS made the decision
    to exempt an additional 585,560 clinicians from the program, exempting
    an unprecedented number of clinicians from the performance requirement
    s altogether.

    NAACOS fears that continuing to dilute performance requirements and
    exempting nearly half of providers will discourage those clinicians who
    have already made a commitment to value-based care and invested time
    and resources towards making the shift to value-based care. Instead,
    Congress and CMS should reward high-
    performing clinicians who have invested heavily in performance
    improvement and should therefore be rewarded for this investment, time,
    and effort. While we support providing a phased-in approach to value-
    based payments for Medicare, it should be noted that the Agency's
    legacy programs, from which the MIPS program was developed, have been
    in existence for years and therefore these clinicians have had ample
    time to prepare for these changes. It is critical that Congress and CMS
    continue their commitment to transition providers toward value-based
    payments to improve the experience of care and the health of
    populations and reduce per capita costs of health care.
    Medicare Shared Savings Program Recommendations

    7. Increase MSSP BASIC Track Shared Savings Rates

    Current rates shared savings rates finalized under the Pathways rules
    are: Basic Levels A and B: 40%; Levels C, D and E: 50%. We urge
    Congress to focus its efforts on not only making models with downside
    financial risk more attractive, but also continuing to support shared
    savings-only models. It is essential that Congress structure the
    program such that it includes a business model attractive enough to
    retain current participants while bringing in new ACOs to create a
    pipeline for ACOs to advance on the path to value-based care.

    We urge Congress to provide sufficient shared savings rates to MSSP
    ACOs to ensure an adequate return on investment and their continued
    participation in the program. Specifically, increase the shared savings
    rates to at least the following: Basic Levels A and B: 50%; Levels C
    and D: 55%; Level E: 60%.

    8. Eliminate the MSSP High-Low Revenue Distinction

    Under the Pathways to Success Final Rule, CMS created a new distinction
    between ``high revenue'' and ``low revenue'' ACOs. This distinction
    determines program specifics, including the timing for when an ACO must
    move to downside risk. Low revenue ACOs are allowed additional time
    under lower-risk options within the Basic track, while ACOs identified
    as high revenue are required to transition to the Enhanced track more
    quickly.

    We urge Congress to eliminate this distinction for the following
    reasons. First, the distinctions are arbitrary--being ``high'' or
    ``low'' revenue does not determine when an ACO is ready to take on risk
    or how much risk they are able to assume. As previously described,
    significant investments are needed in population health platforms and
    care process changes for ACOs to bear risk. The financial position and
    backing of a particular ACO, as well as the ability to assume risk
    depends on a variety of factors, including local market dynamics,
    culture, leadership, financial status, previous program success, and
    the resources required to address social determinants of health that
    influence care and outcomes for patients.

    Second, the high and low revenue distinctions create unnecessary
    program complexity. Furthermore, the move creates uncertainty for ACOs
    who may have a difficult time predicting the category in which they
    would fall. This distinction may also change over time as ACO
    participant composition changes, adding more complexity and making
    long-term planning very difficult. Removing the distinction would
    minimize some of the complexity and uncertainty.

    9. Provide More Time in Shared Savings-only Models and Keep the
    Enhanced Track Voluntary

    Currently, CMS only allows ACOs entering the program on the Basic Track
    to be in a one-sided risk contract for two to three years. ACOs
    previously in the program can only be in a one-sided risk model for one
    year. CMS also expects Basic Track ACOs to eventually transition to the
    Enhanced Track and therefore take on the most downside risk.

    While there should be movement towards risk, ACOs need more time to
    produce positive financial results and such a movement should be
    appropriate and reasonable to encourage participation in the MSSP which
    is a voluntary program. The levels of risk required in two-sided models
    such as the Enhanced Track are much higher than what many ACOs can bear
    and are not viable options for most ACOs. The decision to take on risk
    is critical to an ACO's choice about which model to select and having
    to potentially pay millions of dollars to Medicare is not feasible for
    many of these organizations. Requiring ACOs to assume downside risk may
    result in many ACOs dropping out of the MSSP, which is an unintended
    consequence and will immediately reduce incentives to help bend the
    cost curve in Medicare.

    We urge Congress to allow MSSP ACOs to remain in a shared savings-only
    model for at least three years before being required to assume any risk
    and to not require any ACOs to participate in the Enhanced track. This
    increased timeline and enhanced flexibility related to risk will help
    ACOs better prepare to take on downside risk, increase participation,
    and lead to more successful outcomes.

    10. Update the MSSP Risk Adjustment Methodology

    CMS uses the CMS Hierarchical Condition Category (CMS-HCC) prospective
    risk adjustment models to calculate beneficiary risk scores, adjust the
    benchmark years used for the historical benchmark, and compute the
    rebased historical benchmark. Accurate risk adjustment is imperative to
    assess ACO performance, as risk adjustment should remove or minimize
    differences in health and other risk factors that impact performance
    but are outside the ACO's control. The risk adjustment cap finalized in
    the Pathways to Success rule allows up to a 3 percent increase over
    five years and should be increased. A risk adjustment methodology that
    allows risk adjustment scores to increase even more will give ACOs a
    better ability to meet their financial benchmarks. A downward cap
    should also be used, thus controlling for outliers on both ends of the
    spectrum. Further, Congress should require CMS to provide additional
    transparency on the risk adjustment methodology, which would allow ACOs
    to better understand the process and provide more certainty.

    Specifically, Congress should:

          i.  Implement a risk adjustment methodology that allows risk
    adjustment scores to increase at least 5% over 5-year agreement period
    and apply a cap of up to -5% on downward adjustments.

         ii.  Require CMS to provide full transparency on the methodology
    (ex. algorithms) used in risk adjustment.

         iii.  Provide funding for an independent study comparing Medicare
    risk adjustment approaches across Medicare programs (including APMs and
    Medicare Advantage).

    11. Modify the MSSP Benchmarking Methodology

    There remain a number of flaws with the MSSP benchmarking methodology
    which must be addressed. Benchmarking is of the utmost importance to
    ACOs; it is a fundamental program methodology which determines how ACOs
    perform individually and is one of the ways CMS evaluates the overall
    success of the program.

    Under the regional benchmarking methodology, CMS uses all ``assignable
    beneficiaries,'' including ACO assigned beneficiaries, in determining
    expenditures for the ACO's region. The determination of which
    beneficiaries are included in the regional population is very important
    as this population is the basis for calculating the regional
    expenditure data that is factored into benchmarks that include a
    regional component. Rather than comparing ACOs to themselves and other
    ACOs, CMS should compare ACO performance relative to fee for service
    (FFS) Medicare by defining the regional reference population as
    assignable beneficiaries without ACO-assigned beneficiaries for all
    ACOs in the region. At the very least, Congress should exclude the ACO
    itself from the region to prevent an otherwise tautological comparison
    that essentially double counts those ACO-assigned beneficiaries.

    12. Allow NPI-level Participation in the MSSP

    Currently, MSSP ACO participation is limited to participation at the
    Tax Identification Number (TIN) level (i.e., acute care hospitals,
    group practice, solo practice, long term care hospitals, skilled
    nursing facilities, etc.). Participants in MSSP ACOs are identified by
    their TIN number. Consequently, there is no option for MSSP ACO
    participation at the National Provider Identifier (NPI) level.

    This limitation presents challenges for individuals who wish to
    participate in an ACO and practice in a group setting that does not
    participate in an ACO under its TIN. Because providers cannot
    participate at the TIN level as an individual unless engaged in solo
    practice, they cannot participate in the program. We recommend Congress
    allows NPI-level participation in the MSSP to increase opportunities
    for participation and provide greater flexibility across a wider range
    of providers.

    13. Provide Upfront Payments to Help ACOs Get Started and Assist
    Providers That Have Difficulty Moving to Risk

    Congress recognized the principle from the ACO authorizing statute that
    one of the purposes of creating ACOs is to ``encourage investment in
    infrastructure and redesigned care processes for high quality and
    efficient service delivery.'' ACOs require a significant amount of
    investment to develop the necessary infrastructure and effectively
    adjust to a different approach to care. These investments are for
    clinical and care management, health IT/population analytics/reporting,
    and ACO management and administration. Not only do such investments
    require a significant amount of time and money, but they also require
    organizations to incur a substantial amount of risk apart from any risk
    associated with strictly providing care. The cost of the necessary
    infrastructure and operating expenses may deter ACOs from starting up
    in the first place or continuing on the path to value, as there is no
    guarantee that the ACOs will earn back the expenses associated with
    such investments.

    We urge Congress to provide greater support to ACOs by providing
    upfront and ongoing payments to assist with such investments and
    operating costs. CMS previously offered programs to help fund ACOs up
    front, with those payments later recouped via shared savings. These
    programs, such as the ACO Investment Model (AIM), should be reinstated
    to help ACOs fund activities and transformations early on in ACOs'
    development.

    14. Increase the MSSP BASIC Track Shared Savings Rates Based on Quality
    Performance

    Currently, an ACO that achieves CMS's established quality performance
    levels is not rewarded and is instead merely prevented from forfeiting
    the shared savings payments it has earned. There is no direct financial
    reward for improving quality of care and no penalty for poor quality
    unless the ACO has generated savings. This lack of reward can be a
    strong disincentive for ACOs to invest in quality improvement. Many
    efforts to improve the quality of care consume ACO resources and
    increase spending relative to the ACO's financial benchmark in the
    short term, even if they decrease Medicare spending over the long term.
    The more an ACO strives to improve quality performance, the more it
    often needs to spend. If the services used to improve quality are
    billable services, they will increase the ACO's spending and reduce the
    probability of beating its benchmark.

    To emphasize and reward above average quality performance or
    improvement, we urge Congress to provide on a sliding scale up to 10
    percentage points of additional shared savings to ACOs scoring in the
    top half of total ACO quality performance or quality improvement.
    Additionally, we urge Congress to add a bonus opportunity for ACOs
    whose quality performance is exceptional, but did not meet criteria for
    shared savings. Adding this bonus opportunity will more appropriately
    incentivize quality improvement.
    Conclusion
    In closing, we appreciate the committee's attention to the important
    issue of monitoring implementation of MACRA. We hope you will consider
    these comments as you continue in your efforts to ensure a successful
    implementation of this critical law which has the power to truly
    transform Medicare payments to pay for value over volume of services
    provided to beneficiaries.

                                     ______

                                  Premier Inc.

                    444 North Capitol Street, NW, Suite 625

                              Washington, DC 20001

                                 T 202-393-0860

                                 F 202-393-6499

                          https://www.premierinc.com/

    The Premier healthcare alliance appreciates the opportunity--to submit
    a statement for the record on the Senate Judiciary Committee's hearing
    titled ``Medicare Physician Payment Reform After Two Years: Examining
    MACRA Implementation and the Road Ahead'' scheduled for May 8, 2019. We
    applaud the leadership of Chairman Grassley, Ranking Member Wyden and
    members of the Committee for holding this hearing to examine the
    Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 and assess
    how well that reform legislation is meeting its goals of improving
    quality of care and value for taxpayers.

    Premier strongly supports the intent of MACRA's Quality Payment Program
    (QPP) to help fix the misaligned incentives in our traditional fee-for-
    service Medicare program. Premier is an ardent supporter of the
    transition toward models where providers are accountable and rewarded
    for high-quality, cost-effective care.

    Physician Incentives: Extending the AAPM Bonus

    MACRA is designed to encourage clinicians to participate in alternative
    payment models (APMs) as a way to move from a volume-based healthcare
    system to a value-based system where healthcare providers organize to
    collaborate to deliver better outcomes. The Advanced APM (AAPM) bonus
    that was established by MACRA to accelerate this movement to value-
    based care expires in 2024 (payment year 2022). This means that new
    accountable care organizations (ACOs) entering the Medicare Shared
    Savings Program (MSSP) Pathways to Success in July 2019 or January 2020
    do not have an opportunity to receive the AAPM bonus. MACRA was written
    with the assumption of the availability of additional AAPMs that would
    be eligible for the 5 percent bonus in OPP. While Premier is encouraged
    by the recent new models announced by the Center for Medicare and
    Medicaid Innovation, the rollout of new APMs, particularly models in
    which specialists can participate, has been slow.

    To allow MACRA to work as intended, Premier urges Congress to extend
    the AAPM bonus at least six additional years, through payment year 2030
    (performance year 2028).

    Giving CMS Authority to Adjust the QP Thresholds

    Under MACRA; eligible professionals (EP) who meet certain revenue
    thresholds for participation in an APM are considered qualified
    participants. (QP) or partial qualified participants. QPs receive 5
    percent bonus payment on their services billed under the physician fee
    schedule and are exempt from MIPS; partial QPs do not receive a bonus
    but are exempt from MIPS unless they participate in MIPS. The
    thresholds to qualify for the AAPM bonus (QP thresholds) are set in
    statute for the payment threshold, but CMS has the authority to set the
    patient threshold. The thresholds increase every other year. Due to the
    lack of availability of AAPMs and the structure of these models, it
    will be increasingly difficult to meet the QP threshold. In the patient
    count method, CMS has adjusted the thresholds in response to MPM
    penetration and the type of models available. We urge Congress to also
    grant CMS the authority to adjust the payment thresholds.

    In closing, the Premier healthcare alliance appreciates the opportunity
    to submit a statement for the record on the Senate Finance Committee
    hearing on MACRA. As an established leader in pay for performance,
    bundled payment and accountable care organization (ACO) models, Premier
    is available as a resource and looks forward to working with Congress
    as it considers policy options to address this very important issue.

    If you have any questions regarding our comments or need more
    information, please contact Aisha Pittman, Senior Director of, at
    aishapittman@premierinc.com or 202-879-8013.

                                     ______

                          Society of Hospital Medicine

                      1500 Spring Garden Street, Suite 501

                             Philadelphia, PA 19130

                               Phone 800-843-3360

                            www.hospitalmedicine.org

    Dear Chairman Grassley, Ranking Member Wyden, and Members of the
    Committee, the Society of Hospital Medicine (SHM), on behalf of the
    nation's hospitalists, is pleased to offer our comments to the Senate
    Finance Committee regarding the recent hearing entitled, ``Medicare
    Physician Payment Reform After Two Years: Examining MACRA
    Implementation and the Road Ahead.''

    Hospitalists are front-line clinicians in America's acute care
    hospitals whose professional focus is the general medical care of
    hospitalized patients. Their unique position in the healthcare system
    affords hospitalists a distinct perspective and systems-based approach
    to confronting and solving challenges at the individual provider- and
    overall institutional-level of the hospital. In this capacity,
    hospitalists not only manage the inpatient clinical care of their
    patients, but also work to enhance the performance of their hospitals
    and health systems. They provide care for millions of patients each
    year, including a large majority of hospitalized Medicare
    beneficiaries, and are national leaders in quality improvement,
    resource stewardship and care coordination.

    Since the inception of the specialty of hospital medicine and the
    founding of SHM in the 1990s, hospitalists have been at the forefront
    of delivery and payment system reform. They are integral leaders in
    helping the healthcare system move from volume to value. Hospitalists
    from across the country are engaged in driving innovation aimed at
    achieving higher quality and lower cost care for their patients. As
    such, they are key leaders and partners in alternative payment model
    (APM) adoption, including bundled payments, the Medicare Shared Savings
    Program Accountable Care Organizations (ACOs), and managed care.

    The Medicare Access and CHIP Reauthorization Act (MACRA) created two
    pathways to encourage providers to move away from Medicare fee-for-
    service (FFS) billing: Alternative Payment Models (APMs) and the Merit-
    based Incentive Payment System (MIPS). MACRA seeks to incentivize
    providers to utilize payment structures that focus on value, rather
    than volume, of care. We are very supportive of Congress' efforts to
    reform the FFS payment system and believe more must be done to drive
    innovation and align incentives for lower-cost, high quality care.
    Through our members' experiences in the first few years of the program,
    we have identified several concerns and provide suggestions below.

    Barriers to Alternative Payment Model (APM) Adoption

    MACRA seeks to incentivize providers to move away from fee-for-service
    (FFS) Medicare towards APMs. Qualified participation in an APM provides
    an exemption from the MIPS and a 5 percent lump sum incentive payment
    through 2024. In order to determine whether a provider qualifies for
    the APM pathway of MACRA, the law established thresholds of payment or
    patients. In 2019 and 2020, the thresholds are set at 25 percent of
    Medicare payments; 2021 and 2022 at 50 percent; 2023 and beyond at 75
    percent. For patient count, providers must meet generally similar
    thresholds in each year. Starting in 2021, the thresholds may be met
    through an all-payer analysis, though providers must still reach a
    minimum threshold of Medicare payments or patients. We understand the
    law specified these thresholds to ensure that providers are
    meaningfully engaged with the APM and have moved significantly away
    from FFS Medicare.

    SHM believes that encouraging providers to move into APMs is the most
    important aspect of MACRA. We see APMs as the only pathway away from
    the costly FFS system. APMs are also important because they return a
    significant amount of control directly to providers. That said, the
    threshold model of APM participation creates a major barrier for many
    providers, leaving them stuck in traditional fee-for-service Medicare
    and the MIPS. Small fluctuations in patient mix can result in providers
    qualifying as APM participants one year and not the next. In addition,
    some of the APM models, such as Bundled Payments for Care Improvement
    (BPCI) Advanced, are condition-based, meaning generalists like
    hospitalists will be unable to collect enough payments or patients to
    meet the threshold. In the original BPCI, hospitalist participants that
    engaged with 12 different condition bundles in the model were unable to
    meet even the lowest thresholds set for the program.

    We believe the thresholds serve as an impediment to meeting the intent
    of MACRA and, importantly, as a barrier to cost containment. Well-
    designed APMs have the potential to save a significant amount of money
    for the Medicare Trust Fund, while the budget-neutral MIPS does not
    share the same potential. To save money, we must move more providers
    off of fee-for-service and onto APMs.

    Rethinking Exclusions Under the MIPS

    The Merit-based Incentive Payment System (MIPS) was developed to
    transition the traditional Medicare fee-for-service payment system into
    value-based payments. We have serious concerns about the effectiveness
    of the program, as nearly 60 percent of providers are completely exempt
    from the program under current Medicare policies. Since the MIPS is a
    budget-neutral program, the money used to incentivize high performers
    is taken from underperforming providers who are penalized. As more
    providers are exempted from the program, the pool of potential payments
    for high performing providers has decreased significantly. To ensure
    compliance in the MIPS, providers that are not exempt have had to
    invest significantly in data infrastructure, administration and
    reporting under the program. However, with such large numbers of exempt
    providers, the potential return on those investments are negligible.
    With so many providers exempt from the program, we also have serious
    concerns about the relevance and accuracy of data reflected by measures
    that are being reported in the MIPS.

    CMS has indicated through rulemaking that they believe exemptions from
    the program are necessary because of concerns about the validity of
    data in measures with small case volumes and the financial burdens
    placed on providers for reporting. We believe these exemptions and the
    reasoning for them are evidence of serious structural flaws within the
    program. Policymakers should focus on refinements aimed at achieving a
    meaningful program that yields simple and actionable feedback for all
    Medicare providers.

    Pay for Performance: Are We Measuring the Right Things?

    Measurement has become a central feature of the Medicare system. The
    use of measurement in pay-for-performance programs is built around an
    assumption that measurement can lead to improvements in quality and
    reductions in cost. SHM agrees that well-designed measures have the
    potential to yield these outcomes and may be worth the time, work, and
    cost to implement. Looking at the MIPS, current policies create a
    complicated program with measures that give providers very little
    meaningful and actionable feedback. Providers spend a significant
    amount of time and money on reporting quality measures that may not be
    reflective of their entire practice or even report on most of their
    Medicare patients. Instead, they are participating in the MIPS as a
    compliance effort to avoid significant penalties.

    We believe there is an ample opportunity to step back from siloed and
    micromanaged quality and cost measures and focus on developing
    indicators for the quality and safety of healthcare and on the general
    health and well-being of communities. Shared accountability between
    providers on these broad indicators will lead to the proliferation of
    local-level quality improvement and cost-reduction efforts. This
    systems-based approach, while it does not contain the most narrowly
    tailored measures to specific specialties or individual clinicians, is
    how patients view the healthcare system and is ultimately how providers
    must work together to improve quality and decrease costs. We believe
    the goal of the MIPS should be to point providers in the right
    direction by aligning incentives and having simple and clear markers
    that are shared across providers and specialties.

    Policy and Definitions That Are Inconsistent With Practice Realities

    Often, MIPS/MACRA definitions and policy does not align with practice
    realities. A clear example of this is an issue that facility-based
    providers, including hospitalists, are facing with the definition of
    hospital based group in the Promoting Interoperability (formerly
    Advancing Care Information) category of the Merit-based Incentive
    Payment System (MIPS).

    Hospital-based providers are meant to be exempt from the Promoting
    Interoperability (PI) category in the MIPS. This policy acknowledges
    that these providers are working in settings that use Certified
    Electronic Health Record Technology (CEHRT) and participate as
    providers working in eligible hospitals in the Promoting
    Interoperability Program (formerly EHR Incentive Program). It prevents
    unnecessary duplication and excessive administrative burden practices
    that work primarily in the hospital. We note the policy is meant to
    account for how hospital-based providers are already doing work for
    their hospitals to meet similar or identical requirements in the
    eligible hospital Promoting Interoperability Program. Furthermore, it
    protects hospital-based providers from being penalized for factors
    outside of their control, since they do not always have full access to
    or influence over the CEHRT used in their facilities.

    To determine whether a MIPS eligible clinician (defined as a unique
    Taxpayer Identification Number National Provider Identifier (TIN-NPI)
    combination) is exempt from PI as a hospital-based provider, the
    Centers for Medicare and Medicaid Services (CMS) uses a threshold of 75
    percent of covered professional services in Place of Service (POS)
    codes for off-campus outpatient hospital (POS 19), inpatient hospital
    (POS 21), on-campus outpatient hospital (POS 22), or emergency room
    (POS 23) during a 12-month determination period. If a MIPS eligible
    clinician meets or exceeds this threshold, they are exempt from the PI
    category and the category weighting is reallocated to the MIPS Quality
    category.

    To determine whether a group is exempt as a hospital-based group, CMS
    has indicated that 100 percent of the eligible clinicians associated
    with the group must be designated as hospital-based during the same 12-
    month determination period. This extremely restrictive definition is
    inconsistent with the overarching intent of the hospital-based PI
    exemption as it requires groups that have only a single provider whose
    billing deviates from the exemption to participate in PI. This does not
    only make sense in the real world of medical practice but is also
    resulting in many hospital-based providers being subject to unfair
    penalties that are not of their making and have nothing to do with
    their performance.

    It is imperative that the MIPS policies and definitions reflect
    practice realities in order to make the program as relevant as possible
    to providers. We encourage the Committee to work with CMS and with
    stakeholders to identify areas where policy changes must be made to
    ensure practices are accurately represented and assessed under pay for
    performance programs.

    Conclusion

    The Society of Hospital Medicine looks forward to working with the
    Committee as it looks to achieve the shared goals of MACRA: higher
    quality care at lower cost. We stand ready to help craft policies that
    are not only easier for providers to understand, but also aim toward
    better accomplishing the stated intent of MACRA.

                                     ______

                          Society of Thoracic Surgeons

                       633 N. Saint Clair St., Suite 2100

                             Chicago, IL 60611-3658

                                 (312) 202-5800

                              https://www.sts.org/

    May 21, 2019

    The Honorable Chuck Grassley        The Honorable Ron Wyden
    Chairman                            Ranking Member
    U.S. Senate                         U.S. Senate
    Committee on Finance                Committee on Finance
    219 Dirksen Senate Office Building  219 Dirksen Senate Office Building
    Washington, DC 20510                Washington, DC 20510

    Dear Senators Grassley and Wyden,

    On behalf of The Society of Thoracic Surgeons, I write to thank you for
    hosting the May 8, 2019 hearing titled, ``Medicare Physician Payment
    Reform After Two Years: Examining MACRA Implementation and the Road
    Ahead.'' We appreciate your continued oversight on the implementation
    of the Medicare Access and CHIP Reauthorization Act (MACRA).

    Founded in 1964, STS is an international not-for-profit organization
    representing more than 7,000 cardiothoracic surgeons, researchers, and
    allied health care professionals in 90 countries who are dedicated to
    ensuring the best surgical care for patients with diseases of the
    heart, lungs, and other organs in the chest. The mission of the Society
    is to enhance the ability of cardiothoracic surgeons to provide the
    highest quality patient care through education, research, and advocacy.

    Merit-based Incentive Payment System (MIPS)

    MACRA was designed to promote value (quality/cost) rather than simply
    rewarding physicians for the volume of service they provide. This means
    the Centers for Medicare and Medicaid Services (CMS) must be able to
    effectively measure quality. STS has been a pioneer in this space with
    the STS National Database (the Database) that recently received the
    John M. Eisenberg Patient Safety and Quality award from the National
    Quality Forum (NQF) and The Joint Commission. The Database, established
    in 1989, includes subspecialty registries for adult and pediatric
    cardiac surgery, mechanical circulatory support, and general thoracic
    surgery. Using data from the registry, STS has developed risk models
    and NQF-endorsed composite performance measures for all of its
    subspecialties and major procedures to help providers guide their
    improvement initiatives. These measures are the basis for the Society's
    highly successful voluntary public reporting program.

    Unfortunately, none of this expertise is being utilized in the Merit-
    Based Incentive Payment System (MIPS). As practices continue to
    consolidate, an increasing number of surgeons work under larger, multi-
    specialty and often facility-based groups. Since these groups often opt
    to participate in federal quality reporting programs at the hospital or
    group practice level (i.e., at the Taxpayer Identification Number
    level), the individual clinicians in these practices are increasingly
    losing autonomy over the selection of measures and reporting mechanisms
    that are most relevant to their specific specialty and patient
    population. This arrangement means that cardiothoracic surgeons are not
    able to influence their own personal quality scores as their hospitals
    or groups may elect to report on quality measures that are
    insignificant or irrelevant to cardiothoracic surgery. This will result
    in a number of problems for physicians, patients, and the Medicare
    program:

        a.  MACRA was founded on the principles of promoting and
    incentivizing quality care throughout health care. However, without
    utilizing cardiothoracic surgery specific quality measures, CMS fails
    to incentivize quality in one of the specialties that has the largest
    impact on Medicare beneficiaries and is one of the largest cost centers
    in the Medicare program.

        b.  Without utilizing measures specific to cardiothoracic surgery,
    cardiothoracic surgeons are not able to quantify their value to their
    employers and may have their contribution to the overall performance of
    the hospital diminished.

    STS has urged CMS to ensure that specialists, including physicians
    employed by hospitals or group practices, have the option to report on
    quality metrics that are germane to their practice. CMS has adopted a
    policy whereby physicians can report via multiple mechanisms and have
    their MIPS scores calculated based on the highest reported score. This
    policy fails to give adequate incentive for physicians to report on the
    quality measures that are most relevant to them. Until CMS levels the
    playing field and recognizes the value of true quality measurement, the
    MIPS program will fail to realize its purpose of incentivizing high
    value care.

    Alternative Payment Models (APMs)

    Medicare Claims Data
    The Quality Payment Program (QPP) that was derived from the MACRA
    statute was intended to create value in health care. Indeed, the most
    valuable tool for patients who are interested in making proactive
    choices about their health care is value transparency. Fortunately, the
    Database already provides for quality transparency through STS Public
    Reporting online. If CMS were to adequately implement Section 105(b) of
    MACRA (Pub. L. 114-10), we would have access to Medicare claims data,
    or the cost denominator of the value equation. These datasets would
    also help us to develop and adequately benchmark novel APM concepts and
    advance the value proposition throughout the Medicare program.
    Unfortunately, the programs CMS has offered to implement that section
    of statute are not working.

    Section 105(b) of MACRA requires CMS to provide Qualified Clinical Data
    Registries (QCDRs) with access to Medicare data for purposes of linking
    such data with clinical outcomes data and performing risk-adjusted,
    scientifically valid analyses and research to support quality
    improvement or patient safety. CMS initially decided not to issue
    rulemaking on this section of the law based on its assertion that QCDRs
    currently can request Medicare claims data through the Research Data
    Assistance Center (ResDAC) data request process. This position ignored
    the fact that Section 105(b) is intended to provide QCDRs with access
    to Medicare data for quality improvement purposes, not just clinical
    research, and that the broad and continuous access needed for quality
    improvement purposes is fundamentally different than the access to
    Medicare data for research purposes provided by ResDAC. In subsequent
    rulemaking, CMS decided to treat QCDRs as ``quasi-qualified entities''
    for purposes of obtaining access to Medicare claims data for quality
    improvement, but maintained that QCDRs should use the ResDAC
    application process for research.

    While we appreciate that CMS has made some effort to provide QCDRs with
    an alternative means of accessing Medicare data, treating QCDRs as
    quasi-qualified entities does not allow the type of access contemplated
    by Section 105(b) of MACRA. To perform data analysis for quality
    improvement purposes and patient safety, QCDRs require long-term and
    continuous access to large Medicare datasets so that they can better
    track clinical outcomes longitudinally. In drafting Section 105(b) of
    MACRA, Congress was aware of this need and, as such, specifically
    directed CMS to provide QCDRs with Medicare claims data. Qualified
    entity status lasts for only three years and continued participation in
    the program requires re-application by submitting documentation of any
    changes to the original application. If the re-application is denied,
    CMS will terminate its relationship with the qualified entity. In
    addition, Medicare fee-for-service files are released quarterly on an
    approximate 5.5 month lag. Qualified entities must pay for each set of
    data they receive, which can become cost prohibitive over time.

    Further, the quasi-qualified entity program covers only the ``quality
    improvement'' portion of a QCDR's access to claims data. If the same
    QCDR wanted to facilitate research combining cost and claims
    information, that QCDR would have to submit a separate application to
    ResDAC. In fact, if the QCDR already had the claims data in question
    through the quasi-qualified entity program, it would still need to
    apply and pay ResDAC for the same data. The ResDAC application is
    duplicative, time-consuming, and costly, with a significant lag between
    application approval and delivery of data.

    At the same time, every new payment model released by CMS and the
    Center for Medicare and Medicaid Innovation (the Innovation Center)
    includes a provision that hospitals and qualified participants should
    be able to access their own claims information and any additional
    information deemed necessary by the participant. Clearly, CMS
    understands the value of price transparency in health care, yet it is
    failing to implement statute that speaks to that purpose. If CMS is
    truly interested in using its existing authority to provide information
    on the value of health care to the Medicare population, it will take
    another look at how it is implementing Section 105(b) of MACRA. Absent
    that ideal scenario, CMS should provide claims data to the providers
    with a straightforward breakdown of inpatient costs, provider costs,
    post-acute care costs, home health costs, readmission rates, and costs.
    Given these data and local or regional (not necessarily national)
    benchmarks, providers (and patients) will have an idea where care can
    improve and where there are opportunities to improve efficiency. If
    benchmark prices from big data are created, the methodology employed
    should be clear and include relevant stakeholders in the development.
    Physician-focused Payment Model Technical Advisory Committee (PTAC)
    MACRA was founded on the principles of incentivizing value over volume.
    As such, considerable emphasis was placed within MACRA on development
    of and participation in alternative payment models (APMs).
    Specifically, Congress created the physician-focused payment model
    technical advisory committee (PTAC) to both improve transparency at the
    Innovation Center and increase the variety, efficacy and number of
    APMs, in hopes of maximizing the number of physicians and medical
    specialties able to participate. STS was prepared to offer a physician
    focused payment model (PFPM) to both the PTAC and the Innovation Center
    for consideration and implementation. Because of our unique resource--
    the Database--we believed that we would be able to demonstrate to CMS a
    payment model capable of rewarding physicians for increasing the
    quality of care they provide and reducing resource use. Unfortunately,
    the APM pathway has become extremely complicated and difficult to
    navigate. According to legal review by the office of the Assistant
    Secretary for Planning and Evaluation, under current statute, PTAC is
    not able to provide technical assistance to stakeholders during APM
    development. Without this assistance, APMs eventually fail to navigate
    the complexities of getting a proposed APM from development through
    PTAC review and on to Innovation Center implementation. Although
    Congress attempted to address this concern with language added to the
    Balanced Budget Act of 2018, PTAC has indicated that it is still not
    able to provide technical assistance and data analyses to stakeholders
    who are developing proposals for its review. Additional technical
    corrections may be needed to provide the PTAC with more flexibility in
    this regard.
    Bundled Payment for Care Improvement--Advanced (BPCI-A)
    A notable success of MACRA implementation has been our recent
    collaboration with the Innovation Center on the development of quality
    measures for two episodes of care contained in BPCI-A. Unlike our
    experience with other APMs, staff from the Innovation Center
    proactively sought, and utilized feedback from stakeholders on how to
    adequately measure quality within a payment bundle. The result is that
    the Innovation Center is looking to implement episodes under BPCI-A
    that rely on clinical data registries for true quality reporting.

    The failed mandatory Coronary Artery Bypass Graft (CABG) episode
    payment model (EPM) provides a perfect example of why this is so
    important. Under the proposed CABG EPM, CMS intended to use two quality
    measures: a patient assessment of care and all-cause mortality. It is
    understandable that CMS would identify these measures because they are
    easy to quantify with the tools they have available. However, they do
    not paint an adequate picture of quality. The mortality rate for CABG
    is already at 2%. We questioned how CMS planned to distinguish among
    EPM participants if 98% of them were already hitting the prescribed
    quality benchmark.

    The proposed CABG episode under BPCI-A intends to offer a far more
    robust quality measure: the STS-developed CABG Composite Score. The STS
    CABG Composite Score is calculated using a combination of 11 measures
    of quality divided into four broad categories or domains. Importantly,
    the 11 individual measures and the overall composite measure
    methodology are all endorsed by the NQF and have undergone careful
    scrutiny by quality measure experts. The four domains are:

          Risk-adjusted mortality.
          Risk-adjusted major morbidity, which represents the percentage
    of patients who leave the hospital with none of the five most serious
    complications (often referred to as morbidities) of CABG-reoperation,
    stroke, kidney failure, infection of the chest wound, or prolonged need
    to be supported by a breathing machine, or ventilator. Some of these
    complications, such as stroke or kidney failure, are just as important
    to many patients as whether they survive the surgery, as these outcomes
    profoundly impact quality of life. Overall, based on data from the
    Database, about 85 percent of patients are discharged with no such
    complications.
          The percentage of CABG procedures that include the use of at
    least one of the arteries from the underside of the chest wall--the
    internal mammary (or internal thoracic) artery--for bypass grafting.
    This artery has been shown to function much longer than vein grafts,
    which can become blocked over time.
          How often all of the four medications believed to improve a
    patient's immediate and long-term outcomes were prescribed. These
    medications include beta-blocking drugs prescribed pre-operatively, as
    well as aspirin (or similar drugs to prevent graft clotting), and
    additional beta-blockers and cholesterol-lowering medicines prescribed
    at discharge.

    Without registries, CMS did not have a way to effectively measure
    quality for CABG, one of the most common procedures performed in the
    Medicare population and therefore one of the major Medicare cost
    centers. By working together, we have been able to design an episode
    that should be able to more effectively demonstrate value.

    Other

    Electronic Health Records (EHR)
    Data-blocking by electronic health records (EHR) vendors remains a
    significant barrier to the provision of high quality health care.
    Additional provisions included in the 21st Century Cures Act address
    lack of interoperability among EHRs but also between EHRs and clinical
    data registries. The recent proposed rules on interoperability did not
    provide great detail on how these data-sharing concerns will be
    addressed. We urge Congress to continue to carefully monitor this
    implementation, with special interest in how the practice of data-
    blocking is inhibiting success under the QPP.
    MIPS Payment Adjustments and APM Glide Path
    We agree with many of the panelists who testified about their concerns
    that Medicare payments have failed to keep up with inflation. We are
    also concerned that, due to the way MACRA has been implemented, many
    physicians have not had an APM available to them so they could not
    benefit from the statutory bonus Congress created to facilitate
    physicians' transition to APMs. We agree that Congress should intervene
    to replace the upcoming physician payment freeze with positive payment
    updates under MIPS and extend the APM bonus so more physicians have the
    opportunity to transition to APMs.

    We strongly disagree with the testimony that CMS should use a budget-
    neutral approach that would increase payment rates for ambulatory E/M
    services while reducing payment rates for other services (e.g.,
    procedures, imaging, and tests). We support the proposed E/M payment
    rate changes as proposed by the RVS Update Committee (RUC). As with any
    other rate changes, budget neutrality adjustments are required. We
    strongly urge the Senate Finance Committee to apply any budget
    neutrality adjustments across all specialties. Recent policy has
    continually favored primary care over other specialists (e.g., surgery,
    imaging and testing) to the detriment of these specialists. Our
    specialty society worked with primary care and others to help correct
    payment changes related to the work of all physicians. To favor primary
    care over other specialties in this circumstance would impact the
    integrity of the process. While we support primary care physicians and
    initiatives supporting them and their work, we do not support it at the
    expense of other specialists.

    STS remains fully committed to improving the quality, safety, and
    efficiency of care for all patients. We had hoped that MACRA would help
    to move our healthcare system toward a value based system. However, we
    remain frustrated with the implementation of MACRA. We hope that
    Congress and CMS can work together to truly measure quality and allow
    for more alternative payment models that reimagine how health care is
    delivered. We look forward to working with you on this issue. Please
    contact Courtney Yohe Savage, STS Director of Government Relations, at
    cyohe@sts.org or 202-787-1230 should you need additional information or
    clarification.

    Sincerely,

    Robert S.D. Higgins, MD
    President

                                       [all]