ONC: Time to Get Busy with Value-based Payment Models

"We're in a little bit of a we-don't-know-what-we-don't-know state as an industry. And it's going to dawn on people really quickly that MACRA is a really big deal," says a co-chair of ONC's Health IT Standards Committee.

With a new year comes new leadership at ONC's Health IT Standards Committee. One of the recently appointed co-chairs of the committee is Arien Malec, vice president for the data platform solution line at RelayHealth. Last week I asked Malec what to expect from the committee in 2016. The transcript below has been lightly edited.

HealthLeaders: We had a lot of rulemaking at the end of last year, we had some spin put on the rulemaking by people like Andy Slavitt in January. So what is the industry thinking about meaningful use itself, and about stage 3 in particular?

Malec: The joking statement that I've done on Twitter is to keep calm and await MACRA-enabling regulation. Meaningful use is indelibly written in the ink of MACRA. It is indelibly written into the MIPS calculation, as 25% of the overall MIPS score.

And use of certified health information technology is required in the APM, the alternative payment methodology track under MACRA, and then for hospitals, critical access hospitals and Medicaid, the reforms that MACRA put in just aren't there.

Meaningful use is alive and well in all of those tracks. What CMS has been very clear about is its desire to streamline measurement, make measurement more outcome-oriented and less process-oriented.

[It's more about] have we taken appropriate care of diabetic patients and less [about] have we counted the clicks for updating the problem list? CMS has announced, in many different forms, its desire to make sure that those measurements are aligned, so that potentially you get dual credit for certain measures.

As well as removing the process-oriented measures to the extent possible from meaningful use, there may be a level of deeming that's appropriate, relative to clinical quality measure outcomes. CMS has some flexibility, even with regard to the critical access and hospital-based measures, and to some extent with Medicaid measures, in terms of aligning those requirements with other CMS programs like ACOs or bundled payment programs and the like.

I would expect a steady progress of aligning meaningful use with those other programs. Organizations that want to continue on a sole meaningful use track might well do that. But I expect most organizations to start shifting toward the alternative payment track, and I'd expect to see CMS be accommodative of that shift by making it easy to check the meaningful use box along with the mainline focus on alternative payment and value-based payment.

Medicaid may require some legislative fixes, because I don't think all the levers are under CMS's control, and Medicaid doesn't have currently the concept of an ACO or those kinds of value-based measures, although there are Medicaid Advantage plans that are more value-oriented.

So there's going to be some room for legislative fixes. There's going to be a lot of room for CMS program alignment, and that's been consistent with what industry in general and what Congress specifically has been asking CMS to do. All of CMS's public statements have been aligned with that. I think Andy Slavitt was trying to say all that, and people caught the first part of the statement of meaningful use as we know it is effectively dead, and they didn't pick up the second part of that statement, which tried to explain where meaningful use is going, aligned with value-based payment and value-based care approaches.

HealthLeaders: So are you saying the penalty phase of meaningful use for physicians is pretty much at an end, but the penalty phase for hospitals continues?

Malec: Correct. CMS is bound by the legislation, and until Congress changes the ink on the law, CMS has no regulatory flexibility to adjust the penalty phase. What CMS does have, or should have regulatory flexibility to do, is to say, you can meet the meaningful use measures in these appropriate ways, and one of those, again, aligned with where Congress has been very explicit in MACRA, could well be participation in a bundled payment program or participation in an ACO.

HealthLeaders: But there are those critics out there, former HIT Standards Committee chair John Halamka being one of them, who basically say we should declare victory on meaningful use, go home, and start the work on MIPS and MACRA and not try to belabor what meaningful use tried to do that apparently it has not always been successful at.

Malec: Yeah, and I think if you peel it back, and peel back the money quotes, you get to a very similar place with what John Halamka and other critics have said, which is, let's stop counting clicks, let's stop with onerous certification requirements that aren't aligned with clinical quality. Let's do certification that actually improves interoperability, and let's do meaningful use measurement that's aligned with more outcomes-based approaches and less process-based approaches.

HealthLeaders: So is that what you're expecting the new notices of proposed rulemaking (NPRMs) to do, is to radically change certification of software?

Malec: I would not expect certification criteria to change off of the 2015 edition of certification criteria. It's important to keep in mind that ONC and CMS knew full well what was going on with MACRA when they published the meaningful use and the certification requirements.

It's possible, and I think likely, that ONC will continue to refine certification requirements to be better aligned with ACO enablement. If you look at the text of the [Senate] HELP committee draft, there's language on population health enablement and standards that are required there.

I would expect the standards committee to get involved in looking at standards readiness and system readiness for value-based care, and there's more work to be done, obviously, in the area of both standards and policy and business practices, to better enable improved care and improved health.

In addition, we've got precision medicine that's going on, and there's going to continue to be work on standards to enable research, precision medicine, and a learning health system, so I would not expect the standards work to slow down. I've generally been in favor of focusing certification on interoperability, and making sure that those certification requirements are actually material in improving interoperability and not about checking boxes.

HealthLeaders: I know there are some improvements in stage 3 along those lines, but do you think the industry is going to be able to handle this uncertainty? Because their job right now is to build certified for stage 3, right?

Malec: Yes. And I think the industry in general, if it's expecting change to slow down, is going to be sadly mistaken. I've talked to a number of CIOs and CMIOs, and I've asked the question, where are you with MACRA readiness? And to a person, they kind of look at me and go, 'huh?'

What I think people aren't realizing right now is that although MACRA payment adjustments start in 2019, CMS usually does measurements two years in advances, [which] starts in 2017.

And we're talking real dollars in MACRA. We're talking real dollars in preparing for, if you go the alternative payment track. We're talking even more real dollars, and a lot of preparation that's required to get there, so I think we're in a lull, [and] in a little bit of a we-don't-know-what-we-don't-know state as an industry. And it's going to dawn on people really quickly that MACRA is a really big deal.

That's going to drive some significant changes, both with regard to how technology is developed, but also with regard to how delivery systems use technology to drive clinical quality improvements.

HealthLeaders: So what's your call to action to those CIOs and CMIOs? What should they be doing today?

Malec: If you look at the way that MACRA is built, it is highly advantageous to participate in an alternative payment methodology. Under MIPS, you've got this kind of micro-adjustment of your payment. It goes up, it goes down, and it's zero-based, so by definition, if you go up, somebody else is going down.

On the APM track, you get a guaranteed 5% year-over-year fee for service increase, plus whatever you make in your value-based bonus under the alternative payment program, so if you're on a two-sided risk model in an ACO, you have the ability to make money by delivering excellent care more efficiently.

It's worth noting that the alternative payment track requires more than the usual financial risk, so those kind of one-sided or pay for performance programs, where you get a bonus, but you don't get a ding, likely wouldn't count.

CMS needs to clarify what alternative payment methodologies mean under MACRA. So if I were a health system, I would be preparing now for participation in meaningful value-based programs, and a lot of the work in preparing now is governance oriented, physician culture oriented, but there's also a lot of work in data acquisition.

I think anybody who's looked at the news regarding ACOs will tell you that interoperability is one of the harder parts of running an ACO, and you need to start the work now in order to complete the work in 2017 or 2018, so that you can ready yourself for 2019 or 2020. This is definitely going to require a lot more of a longer-term thought process than we've seen in healthcare to date. We saw in meaningful use a lot of just-in-time. I got my EHR just in time, and now I'm ready. This is not a just-in-time kind of situation.