81 FR 28162 - 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

Department of Health and Human Services
Centers for Medicare & Medicaid Services

Federal Register Volume 81, Issue 89 (May 9, 2016)

Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) repeals the Medicare sustainable growth rate (SGR) methodology for updates to the physician fee schedule (PFS) and replaces it with a new Merit-based Incentive Payment System (MIPS) for MIPS eligible clinicians or groups under the PFS. This proposed rule would establish the MIPS, a new program for certain Medicare-enrolled practitioners. MIPS would consolidate components of three existing programs, the Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) Incentive Program for Eligible Professionals (EPs), and would continue the focus on quality, resource use, and use of certified EHR technology (CEHRT) in a cohesive program that avoids redundancies. This proposed rule also would establish incentives for participation in certain alternative payment models (APMs) and includes proposed criteria for use by the Physician-Focused Payment Model Technical Advisory Committee (PTAC) in making comments and recommendations on physician-focused payment models. In this proposed rule we have rebranded key terminology based on feedback from stakeholders, with the goal of selecting terms that would be more easily identified and understood by our stakeholders.

[Federal Register Volume 81, Number 89 (Monday, May 9, 2016)]
[Proposed Rules]
[Pages 28162-28586]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-10032]



[[Page 28161]]

Vol. 81

Monday,

No. 89

May 9, 2016

Part II

Book 2 of 2 Books

Pages 28161-28686





Department of Health and Human Services





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Centers for Medicare & Medicaid Services



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42 CFR Parts 414 and 495



 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; Proposed 
Rule

Federal Register / Vol. 81 , No. 89 / Monday, May 9, 2016 / Proposed 
Rules

[[Page 28162]]


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Department of Health and Human Services

Centers for Medicare & Medicaid Services

42 CFR Parts 414 and 495

[CMS-5517-P]
RIN 0938-AS69


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

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Proposed rule.

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SUMMARY: Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) 
repeals the Medicare sustainable growth rate (SGR) methodology for 
updates to the physician fee schedule (PFS) and replaces it with a new 
Merit-based Incentive Payment System (MIPS) for MIPS eligible 
clinicians or groups under the PFS. This proposed rule would establish 
the MIPS, a new program for certain Medicare-enrolled practitioners. 
MIPS would consolidate components of three existing programs, the 
Physician Quality Reporting System (PQRS), the Physician Value-based 
Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) 
Incentive Program for Eligible Professionals (EPs), and would continue 
the focus on quality, resource use, and use of certified EHR technology 
(CEHRT) in a cohesive program that avoids redundancies. This proposed 
rule also would establish incentives for participation in certain 
alternative payment models (APMs) and includes proposed criteria for 
use by the Physician-Focused Payment Model Technical Advisory Committee 
(PTAC) in making comments and recommendations on physician-focused 
payment models. In this proposed rule we have rebranded key terminology 
based on feedback from stakeholders, with the goal of selecting terms 
that would be more easily identified and understood by our 
stakeholders.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. on June 27, 2016.

ADDRESSES: In commenting, please refer to file code CMS-5517-P. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission. You may submit comments in one of four 
ways (please choose only one of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to http://www.regulations.gov. Follow the ``Submit a 
comment'' instructions.
    2. By regular mail. You may mail written comments to the following 
address ONLY: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-5517-P, P.O. Box 8013, 
Baltimore, MD 21244-8013.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address ONLY: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-5517-P, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    4. By hand or courier. Alternatively, you may deliver (by hand or 
courier) your written comments ONLY to the following addresses prior to 
the close of the comment period:
    a. For delivery in Washington, DC--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Room 445-G, Hubert 
H. Humphrey Building, 200 Independence Avenue SW., Washington, DC 
20201.
    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without Federal government 
identification, commenters are encouraged to leave their comments in 
the CMS drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain a proof of filing 
by stamping in and retaining an extra copy of the comments being 
filed.)
    b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.
    If you intend to deliver your comments to the Baltimore address, 
call telephone number (410) 786 7195 in advance to schedule your 
arrival with one of our staff members. Comments erroneously mailed to 
the addresses indicated as appropriate for hand or courier delivery may 
be delayed and received after the comment period.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: 
    Molly MacHarris, (410) 786-4461, for inquiries related to MIPS.
    James P. Sharp, (410) 786-7388, for inquiries related to APMs.

SUPPLEMENTARY INFORMATION: 
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://www.regulations.gov. Follow the search instructions on that Web site to 
view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1-800-743-3951.

Acronyms

    Because of the many terms to which we refer by acronym in this 
proposed rule, we are listing the acronyms used and their corresponding 
meanings in alphabetical order below:

ABCTM Achievable Benchmark of Care
ACA The Patient Protection and Affordable Care Act
ACO Accountable Care Organization
APM Alternative Payment Model
BPCI Bundled Payments for Care Improvement
CAH Critical Access Hospital
CAHPS Consumer Assessment of Healthcare Providers and Systems
CEHRT Certified EHR technology
CFR Code of Federal Regulations
CHIP Children's Health Insurance Program
CJR Comprehensive Care for Joint Replacement
CMMI Center for Medicare & Medicaid Innovation (Innovation Center)
CPIA Clinical Practice Improvement Activity
CPR Customary, Prevailing, and Reasonable
CPS Composite Performance Score
CPT Current Procedural Terminology
CQM Clinical Quality Measure
EHR Electronic heath record
EP Eligible professional
FFS Fee-for-Service
FQHC Federally Qualified Health Center
HIE Health Information Exchange
HIPAA Health Insurance Portability and Accountability Act of 1996
HITECH Health Information Technology for Economic and Clinical 
Health
HPSA Health Professional Shortage Area
HHS Department of Health & Human Services
HRSA Health Resources and Services Administration
IT Information technology

[[Page 28163]]

MACRA Medicare Access and CHIP Reauthorization Act of 2015
MEI Medicare Economic Index
MIPAA Medicare Improvements for Patients and Providers Act of 2008
MIPS Merit-Based Incentive Payment System
MLR Minimum Loss Rate
MSPB Medicare Spending per Beneficiary
MSR Minimum Savings Rate
MUA Medically Underserved Area
NPI National Provider Identifier
OCM Oncology Care Model
ONC Office of the National Coordinator for Health Information 
Technology
PECOS Medicare Provider Enrollment, Chain, and Ownership System
PFPMs Physician Focused Payment Models
PFS Physician Fee Schedule
PHS Public Health Service
PQRS Physician Quality Reporting System
QCDRs Qualified Clinical Data Registries
QP Qualifying APM Professional
QRDA Quality Reporting Document Architecture
QRUR Quality and Resource Use Reports
RBRVS Resource-Based Relative Value Scale
RHC Rural Health Clinic
RVU Relative Value Unit
SGR Sustainable Growth Rate
TCPI Transforming Clinical Practice Initiative
TIN Tax Identification Number
VM Value-based Payment Modifier
VPS Volume Performance Standard

Table of Contents

Executive Summary
I. Background
    A. Physician and Practitioner Payment Under Medicare
    B. Current Reporting Programs and Regulations (Overview)
    C. Overview of Section 101 of the MACRA
    D. Stakeholder Input
II. Provisions of the Proposed Regulations
    A. Establishing MIPS and the APMs Incentive
    B. Program Principles and Goals
    C. Changes to Existing Programs
    D. Definitions
    E. MIPS Program Details
    F. Incentive Payments for Participating in Advanced APMs
III. Collection of Information Requirements
IV. Response to Comments
V. Regulatory Impact Analysis
    A. Statement of Need
    B. Overall Impact
    C. Changes in Medicare Payments
    D. Impact on Beneficiaries
    E. Impact on Other Health Care Programs and Providers
    F. Alternatives Considered
    G. Assumptions and Limitations
    H. Accounting Statement

Executive Summary

1. Purpose

    The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) 
(Pub. L. 114-10, enacted April 16, 2015), amended title XVIII of the 
Social Security Act (the Act) to repeal the Medicare sustainable growth 
rate and strengthen Medicare access by improving physician payments and 
making other improvements, to reauthorize the Children's Health 
Insurance Program (CHIP), and for other purposes. This rule is needed 
to propose policies to improve physician payments by changing the way 
Medicare incorporates quality measurement into payments and by 
developing new policies to address and incentivize participation in 
alternative payment models.
    This proposed rule would establish the Merit-Based Incentive 
Payment System (MIPS), a new program for certain Medicare-participating 
practitioners. MIPS would consolidate components of three existing 
programs, the Physician Quality Reporting System (PQRS), the Physician 
Value-based Payment Modifier (VM), and the Medicare Electronic Health 
Record (EHR) Incentive Program for eligible professionals (EPs), and 
would continue the focus on quality, resource use, and use of certified 
EHR technology in a cohesive program that avoids redundancies. This 
proposed rule also would establish incentives for participation in 
certain alternative payment models (APMs), supporting the 
Administration's goals of moving more fee-for-service payments into 
APMs that focus on better care, smarter spending, and healthier people. 
This proposed rule also includes proposed criteria for use by the 
Physician-Focused Payment Model Technical Advisory Committee (PTAC) in 
making comments and recommendations to the Secretary on physician-
focused payment models (PFPMs).
    In this proposed rule we have rebranded key terminology based on 
feedback from stakeholders, with the goal of selecting terms that would 
be more easily identified and understood by our stakeholders. We 
discuss these terminology changes in greater detail in the following 
sections of this proposed rule.

2. Summary of the Major Provisions

    This proposed rule would sunset payment adjustments under the 
current PQRS, VM, and the Medicare EHR Incentive Program for EPs. 
Components of these three programs would be carried forward into the 
new MIPS program.
    This proposed rule would establish a new subpart O of our 
regulations at 42 CFR 414.1300 to implement the new MIPS program as 
required by the MACRA.
(a) MIPS
    In establishing MIPS, this rule would define MIPS program 
participants as ``MIPS eligible clinicians'' rather than ``MIPS EPs'' 
as that term is defined at section 1848(q)(1)(C) and used throughout 
section 1848(q) of the Act. MIPS eligible clinicians will include 
physicians, physician assistants, nurse practitioners, clinical nurse 
specialists, certified registered nurse anesthetists, and groups that 
include such clinicians. The rule proposes definitions and requirements 
for groups. In addition to proposing definitions for MIPS eligible 
clinicians, the rule also proposes rules for the specific Medicare-
enrolled practitioners that would be excluded from MIPS, including 
newly Medicare-enrolled eligible clinicians, Qualifying APM 
Participants (QPs), certain Partial Qualifying APM Participants 
(Partial QPs), and clinicians that fall under the proposed low-volume 
threshold.
    This rule proposes MIPS performance standards and a MIPS 
performance period of 1 calendar year (January 1 through December 31) 
for all measures and activities applicable to the four performance 
categories. Further, we propose to use 2017 as the performance period 
for the 2019 payment adjustment. Therefore, the first performance 
period would start in 2017 for payments adjusted in 2019. This time 
frame is needed to allow data and claims to be submitted and data 
analysis to occur. In addition, it would allow for a full year of 
measurement and sufficient time to base adjustments on complete and 
accurate information.
    As directed by the MACRA, this rule proposes measures, activities, 
reporting, and data submission standards across four performance 
categories: Quality, resource use, clinical practice improvement 
activities (CPIAs), and meaningful use of certified EHR technology 
(referred to in this proposed rule as ``advancing care information''). 
Measures and activities would vary by category and include outcome 
measures, performance measures, and global and population-based 
measures. Consideration would be given to the application of measures 
to non-patient facing MIPS eligible clinicians.
    Quality measures would be selected annually through a call for 
quality measures process. Selection of these measures is proposed to be 
based on certain criteria that align with CMS priorities, and a final 
list of quality measures will be published in the Federal Register by 
November 1 of each year. Under the standards proposed in this rule, 
there would be options for reporting as an individual MIPS eligible

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clinician or as part of a group. Some data could be submitted via 
relevant third party data submission entities, such as qualified 
clinical data registries (QCDRs), health IT vendors,\1\ qualified 
registries, and CMS-approved survey vendors.
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    \1\ We note that, for this proposed rule, a health IT vendor 
that serves as a third party intermediary to collect or submit data 
on behalf MIPS eligible clinicians may or may not also be a ``health 
IT developer.'' Under the ONC Health IT Certification Program 
(Program), a health IT developer constitutes a vendor, self-
developer, or other entity that presents health IT for certification 
or has health IT certified under the Program. The use of ``health IT 
developer'' is consistent with the use of the term ``health IT'' in 
place of ``EHR'' or ``EHR technology'' under the Program (see 80 FR 
62604; and the advancing care information performance category in 
this rule). Throughout this proposed rule, we use the term ``health 
IT vendor'' to refer to entities that support the health IT 
requirements of a clinician participating in the proposed Quality 
Payment Program.
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    Within each performance category, we propose some specific 
standards, including:
     Quality: For most MIPS eligible clinicians, we propose to 
include a minimum of six measures with at least one cross-cutting 
measure (for patient-facing MIPS eligible clinicians) and an outcome 
measure if available; if an outcome measure is not available, then the 
eligible clinician would report one other high priority measure 
(appropriate use, patient safety, efficiency, patient experience, and 
care coordination measures) in lieu of an outcome measure. MIPS 
eligible clinicians can meet this criterion by selecting measures 
either individually or from a specialty-specific measure set.
     Resource Use: Continuation of two measures from the VM: 
Total per costs capita for all attributed beneficiaries and Medicare 
Spending per Beneficiaries (MSPB) with minor technical adjustments. In 
addition, episode-based measures, as applicable to the MIPS eligible 
clinician.
     CPIA: We generally encourage but are not requiring a 
minimum number of CPIAs.
     Advancing Care Information: Assessment based on advancing 
care information measures and objectives.
    We propose standards for measures, scoring, and reporting for MIPS 
eligible clinicians across all four performance categories outlined in 
this section. We propose that MIPS eligible clinicians who participate 
in certain types of APMs will be scored using an APM scoring standard 
instead of the generally applicable MIPS scoring standard.
    The U.S. Department of Health & Human Services' (HHS) Office of the 
Assistant Secretary for Planning and Evaluation (ASPE) is conducting 
studies and making recommendations on the issue of risk adjustment for 
socioeconomic status on quality measures and resource use as required 
by section 2(d) of the Improving Medicare Post-Acute Care 
Transformation Act of 2014 (the IMPACT Act) and expects to issue a 
report to Congress by October 2016. We will closely examine the 
recommendations issued by ASPE and incorporate them, as feasible and 
appropriate, in future rulemaking.
    We are proposing MIPS eligible clinicians have the flexibility to 
submit information individually or via a group or an APM Entity group; 
however, the MIPS eligible clinician would use the same identifier for 
all performance categories. The proposed scoring methodology has a 
unified approach across all performance categories, would allow MIPS 
eligible clinicians to know in advance what they need to do to perform 
well in MIPS, and eliminates the need for an ``all or nothing'' scoring 
as has been the case under some other CMS programs. The four 
performance category scores (quality, resource use, CPIA, and advancing 
care information) would be aggregated into a MIPS composite performance 
score (CPS). The MIPS CPS would be compared against a MIPS performance 
threshold. The CPS would be used to determine whether a MIPS eligible 
clinician receives an upward payment adjustment, no payment adjustment, 
or a downward payment adjustment as appropriate. Payment adjustments 
would be scaled for budget neutrality, as required by statute. The CPS 
would also be used to determine whether a MIPS eligible clinician 
qualifies for an additional positive adjustment factor for exceptional 
performance.
    To ensure that MIPS results are useful and accurate, we propose a 
process for providing performance feedback to MIPS eligible clinicians. 
Beginning July 1, 2017, we propose to include information on the 
quality and resource use performance categories in the performance 
feedback. Initially, we propose to provide performance feedback on an 
annual basis. In future years, we may consider providing performance 
feedback on a more frequent basis as well as adding feedback on the 
performance categories of CPIA and advancing care information. We 
propose to make performance feedback available using a CMS designated 
system. Further, we propose to leverage additional mechanisms such as 
health IT vendors, registries, and QCDRs to help disseminate data/
information contained in the performance feedback to eligible 
clinicians where applicable.
    We propose to adopt a targeted review process under MIPS wherein a 
MIPS eligible clinician may request that we review the calculation of 
the MIPS adjustment factor and, as applicable, the calculation of the 
additional MIPS adjustment factor applicable to such MIPS eligible 
clinician for a year. We further propose a general process by which a 
MIPS eligible clinician could request targeted review.
    We propose requirements for third-party data submission to MIPS. 
Specifically, qualified registries, QCDRs, health IT vendors, and CMS-
approved survey vendors would have the ability to act as intermediaries 
on behalf of MIPS eligible clinicians and groups for submission of data 
to us across the quality, CPIA, and advancing care information 
performance categories.
    We also propose a process for public reporting of MIPS information 
through the Physician Compare Web site. We propose public reporting of 
a MIPS eligible clinician's data; in that for each program year, we 
will post on a public Web site (for example, Physician Compare), in an 
easily understandable format, information regarding the performance of 
MIPS eligible clinicians or groups under the MIPS.
(b) APMs
    In this rule, we propose standards we would use for the purposes of 
the Alternative Payment Model (APM) incentive. The MACRA defines APM 
for the purposes of the incentive as a model under section 1115A of the 
Social Security Act (the Act) (excluding a health care innovation 
award), the Shared Savings Program under section 1899 of the Act, a 
demonstration under section 1866C of the Act, or a demonstration 
required by federal law. We propose to define the term ``Other Payer 
APMs'' to refer to arrangements in which eligible clinicians may 
participate through other payers. We also propose to define the term 
APM Entity as an entity that participates in an APM through a contract 
with a payer.
    APMs that meet the criteria to be Advanced APMs provide the pathway 
through which eligible clinicians can become QPs and earn incentive 
payments for participation in APMs as specified under the MACRA. This 
rule proposes two types of Advanced APMs: Advanced APMs and Other Payer 
Advanced APMs. To be an Advanced APM, an APM must meet three 
requirements: (1) Require participants to use certified EHR technology; 
(2) provide payment for covered professional services based on quality

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measures comparable to those used in the quality performance category 
of MIPS; and (3) be either a Medical Home Model expanded under section 
1115A of the Act or bear more than a nominal amount of risk for 
monetary loses. In this rule, we propose criteria for each of the 
requirements to be an Advanced APM.
    To be an Other Payer Advanced APM, a commercial or Medicaid APM 
must meet three requirements similar to the CMS Advanced APM 
requirements: (1) Require participants to use certified EHR technology; 
(2) provide payment based on quality measures comparable to those used 
in the quality performance category of MIPS; and (3) be either a 
Medicaid Medical Home Model that is comparable to Medical Home Models 
expanded under section 1115A of the Act or bear more than a nominal 
amount of risk for monetary loses.
    We propose that we would notify the public of which APMs will be 
Advanced APMs prior to each QP Performance Period, starting no later 
than January 1, 2017. This information will be posted on our Web site.
    We propose that professional services furnished at Critical Access 
Hospitals (CAHs), Rural Health Clinics (RHCs) and Federally Qualified 
Health Centers (FQHCs) that meet certain criteria be counted towards 
the QP determination.
    The MACRA sets a Medicare threshold for the level of participation 
in Advanced APMs required for an eligible clinician to become a QP for 
a year. The Medicare Option, based on Part B payments for covered 
professional services or counts of patients furnished covered 
professional services under Part B, is applicable beginning with CY 
2019. The All-Payer Combination Option, based on the Medicare Option, 
as well as an eligible clinician's participation in Other Payer 
Advanced APMs, is applicable beginning with CY 2021. For eligible 
clinicians to become QPs through the All-Payer Combination Option, an 
Advanced APM Entity or eligible clinician must submit information to us 
so that we can determine whether an Other Payer APM is an Other Payer 
Advanced APM and whether an eligible clinician meets the requisite QP 
threshold of participation. We propose a methodology and criteria to 
evaluate eligible clinicians using the All-Payer Combination Option. 
For purposes of evaluating Other Payer APMs, we also propose criteria 
for the definition of Medicaid Medical Homes and Medical Home Model.
    We propose to identify individual eligible clinicians by a unique 
APM participant identifier using the individuals' TIN/NPI combinations, 
and to assess as an APM Entity group all individual eligible clinicians 
listed as participating in an Advanced APM Entity to determine QP 
status for a year. We also propose that if an individual eligible 
clinician who participates in multiple Advanced APM Entities does not 
achieve QP status through participation in any single APM Entity, we 
would assess the eligible clinician individually to determine QP status 
based on combined participation in Advanced APMs.
    We propose the method that CMS would use to calculate and disburse 
the APM Incentive Payments to QPs. We propose specific rules for 
calculating the APM Incentive Payment when a QP also receives non-fee-
for-service payments or payment adjustments through the Medicare EHR 
Incentive Program, PQRS, VM, MIPS, or other payment adjustment 
programs.
    We propose a process for eligible clinicians to choose whether or 
not to be subject to the MIPS payment adjustment in the event that they 
are determined to be Partial QPs.
    We propose that we would perform monitoring and compliance around 
APM Incentive Payments.
    We propose a definition for Physician-Focused Payment Models 
(PFPMs), criteria that would be used by the PFPM Technical Advisory 
Committee (PTAC), the Secretary, and CMS to evaluate proposals for 
PFPMs, and the process by which PFPMs would be considered for testing 
and implementation by CMS after review by the PTAC.
    We propose to require MIPS eligible clinicians, as well as EPs, 
eligible hospitals, and Critical Access Hospitals (CAHs) under the 
existing EHR Incentive Programs to make a demonstration related to the 
provisions concerning blocking the sharing of information under section 
106(b)(2) of the MACRA and, separately, to demonstrate cooperation with 
authorized ONC surveillance of certified EHR technology.

3. Summary of Costs & Benefits

    Under the MACRA's requirements, MIPS would distribute payment 
adjustments to between approximately 687,000 and 746,000 eligible 
clinicians in 2019. Payment adjustments would be based on MIPS eligible 
clinicians' performance on specified measures and activities within the 
four performance categories. We estimate that MIPS payment adjustments 
would be approximately equally distributed between negative adjustments 
($833 million) and positive adjustments ($833 million) to MIPS eligible 
clinicians, to ensure budget neutrality. Additionally, MIPS would 
distribute approximately $500 million in exceptional performance 
payments to MIPS eligible clinicians whose performance exceeds a 
specified threshold. These payment adjustments are expected to drive 
quality improvement in the provision of MIPS eligible clinicians' care 
to Medicare beneficiaries and to all patients in the health care 
system. However, the distribution could change based on the final 
population of MIPS eligible clinicians for CY 2019 and the distribution 
of scores under the program.
    We estimate that between approximately 30,658 and 90,000 eligible 
clinicians would become QPs through participation in Advanced APMs, and 
are estimated to receive between $146 million and $429 million in APM 
Incentive Payments for CY 2019. As with MIPS, we expect that APM 
participation would drive quality improvement for clinical care 
provided to Medicare beneficiaries and to all patients in the health 
care system.

I. Background

    In January 2015, the Administration announced new goals for 
transforming Medicare by moving away from traditional fee-for-service 
payments in Medicare towards a payment system focused on linking 
physician reimbursements to quality care through APMs (http://www.hhs.gov/about/news/2015/01/26/better-smarter-healthier-in-historic-announcement-hhs-sets-clear-goals-and-timeline-for-shifting-medicare-reimbursements-from-volume-to-value.html#) and other value-based 
purchasing arrangements. This is part of an overarching Administration 
strategy to transform how health care is delivered in America, changing 
payment structures to improve quality and patient outcomes.
    The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) of 
2015 (Pub. L. 114-10, enacted April 16, 2015, and hereafter referred to 
as the MACRA), landmark bipartisan legislation, advances a forward-
looking, coordinated framework for health care providers to 
successfully take part in the CMS Quality Payment Program that rewards 
value and outcomes in one of two ways:
     Merit-Based Incentive Payment System (MIPS).
     Advanced Alternative Payment Models (Advanced APMs).

The MACRA marks a milestone in efforts to improve and reform the health 
care system. Building off of the successful coverage expansions and

[[Page 28166]]

improvements to access under the Affordable Care Act, the MACRA puts an 
increased focus on the quality and value of care delivered. By 
incentivizing participation in certain APMs, such as Accountable Care 
Organizations (ACOs), Medical Home Models, and episode payment models, 
and by incentivizing quality and value for eligible clinicians under 
the MIPS, we support the nation's progress toward achieving a patient-
centered health care system that delivers better care, smarter 
spending, and healthier people and communities.
    The Department is focused on three core strategies to drive 
continued progress and improvement, and MACRA provides new tools to 
that end, which build upon existing efforts, such as the CMS Quality 
Strategy \2\. First, we are focused on improving the way clinicians are 
paid to incentivize quality and value of care over simply quantity of 
services. The Quality Payment Program replaces the SGR update formula 
with Medicare PFS updates ultimately linked to participation in 
Advanced APMs and also creates a new, sustainable mechanism for 
calculating payment adjustments for clinicians' services that links 
payments to quality and value: The Merit-based Incentive Payment System 
(MIPS), with the ultimate goal of paying for value and better care. By 
rewarding eligible clinicians based on their performance, MIPS 
consolidates key components of the PQRS, the VM and the Medicare EHR 
Incentive Program for EPs into one single, streamlined program based on 
performance in the following:
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    \2\ https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy.html.
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     Quality.
     Resource use.
     CPIA.
     Advancing care information.
    Second, we are focused on improving the way care is delivered by 
providing clinical practice support, data and feedback reports to guide 
improvement and better decision-making. Allowing for stronger, real-
time, easy-to-understand feedback and actionable data on eligible 
clinician performance on clinical quality measures (CQMs), utilization 
of resources and cost can lead to stronger care coordination, help 
facilitate and enhance team-based approaches, and support greater 
integration within practices, improved patient communication, a 
stronger focus on population health, and continuous learning and rapid-
cycle improvement.
    Third, we are focused on making data more available and enabling 
the use of certified EHR technology to support care delivery. 
Consistent use of certified EHR technology and clinical quality 
measurement in managing patient populations would help lead to 
substantial improvements in our health care system, by allowing 
clinicians to track and take care of their patients throughout the care 
continuum and to easily and securely access electronic health 
information to support care when and where it is needed.
    By driving significant changes in how care is delivered and changes 
in the health care system to make it more responsive to patients and 
families, we believe the Quality Payment Programs would encourage 
eligible clinicians to be accountable for the health of their patient 
population and support interested eligible clinicians in their 
successful transition into APMs. To implement this vision, we propose a 
program that allows for stronger alignment across requirements while 
minimizing burden on eligible clinicians. Further, we propose a program 
that is meaningful, understandable and flexible with a critical focus 
on transparency, effective communication with stakeholders and 
operational feasibility. To aid in this process, we have sought 
feedback from the health care community through various public avenues 
and will seek comment through this proposed rule. As we establish 
policies for effective implementation of the MACRA, we are also focused 
on improving the health system by ensuring that our policies can scale 
in future years. As we drive change through this proposed rule, we will 
begin by laying the groundwork for expansion towards an innovative, 
outcome-focused, patient-centered, resource-effective health system. 
Through a staged approach we can develop our policies are operationally 
feasible and made in consideration of system capabilities and of our 
core strategies to drive progress and reform efforts.

A. Physician and Practitioner Payment Under Medicare

1. History
    Medicare payment systems have undergone significant changes since 
the Act established the Medicare program in 1965. Originally, Medicare 
was modeled on the existing health insurance marketplace (See 1965 
Medicare Amendment to SSA, Pub. L. 89-97). Medicare payments to 
physicians and hospitals were based on the amounts that had been 
historically charged by physicians and hospitals for various health 
care services. Medicare initially paid for physicians' services using a 
``customary, prevailing, and reasonable'' charge (CPR) payment system. 
(1965 Medicare Amendment to SSA, Pub. L. 89-97). Congress later changed 
the CPR system in part to counter increased charges to physicians, 
leading to rapid increases in program payments.
    In 1984, Medicare changed the way it paid hospitals to a 
prospective payment system (Social Security Amendments of 1983, Pub. L. 
98-21) that moved away from a charge-based per diem rate and introduced 
the Medicare Economic Index (MEI) to modify physician payment. The MEI 
was used to measure the annual increase in practice costs for updating 
payment for physicians' services.
    Beginning in 1992 following the passage of the Omnibus Budget 
Reconciliation Act of 1989 (OBRA 89) (Pub. L. 101-239, enacted on 
December 19, 1989), the historical charge-based fee schedule was 
replaced with a fee schedule that used a Resource-Based Relative Value 
Scale, developed at Harvard University, which attempted to assess for 
each service the relative value of a physician's work effort, as well 
as the practice expenses and malpractice liability expenses involved.
    Under OBRA 89, the resource-based Medicare PFS aimed to establish a 
rational basis for valuing payments for physicians' services. 
Therefore, under the current resource-based approach, payment for a 
service depends on the value of the resources involved in performing a 
particular service.
    Following the implementation of the resource-based PFS over several 
years, the fee schedule has specified Medicare payments for physicians' 
services. Each medical, surgical and diagnostic service, described by a 
current procedural terminology (CPT) code is assigned relative value 
units (RVUs) for three resource categories: Work, practice expense, and 
malpractice expense. These three RVU values are summed, geographically 
adjusted, and multiplied by a fixed-dollar conversion factor for the 
payment year to determine the payment amount for each service or 
procedure. Over time, we have reviewed and revised the RVU values using 
our own methodologies and other information.
    After the adoption of the resource-based PFS, further amendments to 
the Act have led to the imposition of spending targets for physicians' 
services. Initially, the spending limit was set by a Volume Performance 
Standard (VPS) that tied the annual update to a target that was based 
on historical trends in physician costs. Because of the way the 
adjustment was

[[Page 28167]]

calculated, it produced very unstable updates, with swings that were 
much greater than the changes in the underlying MEI.
    The Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33, enacted on 
August 5, 1997) replaced the VPS with the SGR formula to update the PFS 
each year. Under BBA, the SGR made several changes including a much 
more aggressive measure to control spending, tying the allowable 
increases in physician spending to the growth rate in real GDP per 
capita. In general, under the SGR formula, if cumulative expenditures 
from the current period going back to 1996 (the base year) were less 
than the cumulative spending target over that same period, the annual 
update was increased according to a statutory formula. However, if 
spending exceeded the cumulative spending target over the same period, 
the SGR methodology requires reductions in the fee schedule update to 
bring spending back in line with the targeted growth rate.
    In the initial years of implementation, actual expenditures did not 
exceed allowed targets. But beginning in 2002, cumulative actual 
expenditures began to exceed allowed targets for the year, resulting in 
SGR-mandated reductions in the fee schedule update adjustment factor. 
The Congress enacted a series of laws to override these reductions. The 
SGR-based update adjustment factor had not been allowed to take effect 
since 2003 due to consistent intervention by the Congress to avert 
payment reductions.
    Currently, payments under the Medicare PFS include several payment 
adjustments that increase or decrease payments to practitioners based 
on performance. The Tax Relief and Health Care Act of 2006 required the 
establishment of the PQRS that would include an incentive payment to 
EPs who satisfactorily report data on quality measures. The Medicare 
Improvements for Patients and Provider Act of 2008 (MIPPA) (Pub. L. 
110-275, enacted on July 15, 2008) made the PQRS program permanent. The 
HITECH Act of 2009, part of the American Recovery and Reinvestment Act 
(ARRA), established incentive payments to EPs to promote the adoption 
and meaningful use of certified EHR technology. HITECH provided the 
statutory basis for the Medicare incentive payments made to meaningful 
EHR users and also established downward payment adjustments, under 
Medicare, beginning with calendar year 2015, for EPs that are not 
meaningful users of certified EHR technology for certain associated 
reporting periods.
    The Affordable Care Act (Pub. L. 111-148) required the 
establishment of a value-based payment modifier that provides for 
differential payment to a physician or group of physicians under the 
Medicare PFS based upon the quality of care furnished compared to cost, 
that is implemented in a budget-neutral manner. Beginning in 2015, the 
VM applies to payments for items and services furnished by physicians 
in groups of 100 or more, and will apply to all physicians and certain 
types of non-physician practitioners in later years. The VM is being 
phased in and will apply to all physicians in groups and individual 
physicians in 2017.
2. Payment Models and Innovation
    The policies proposed in this rule are intended to continue to move 
Medicare away from a primarily volume based fee-for-service (FFS) 
payment system for physicians and other professionals. As described in 
this section of the proposed rule, for many years Medicare was 
primarily a FFS payment system that paid health care providers based on 
the volume of services they delivered, rather than the value of those 
services. This contributed to increased costs without incentivizing 
improvement in the quality of care. Over time, the Congress and CMS 
have taken progressive steps to move toward paying for value, as 
demonstrated by Medicare's long history of testing alternative payment 
methods.
    Medicare has been testing alternative payment methods since waiver 
authority for Medicare demonstrations was granted through section 402 
of the Social Security Amendments of 1967. Demonstrations and pilot 
programs, (also called ``research studies'') are special projects that 
test improvements in Medicare coverage, payment, and quality of care 
(https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/other-health-plans/other-medicare-health-plans.html). Demonstrations 
have examined whether alternative payment methods increase the 
efficiency of Medicare and Medicaid and whether payment for services 
not otherwise covered increases the effectiveness of care. Medicare's 
demonstration authority has allowed it to test the effect of policy 
changes on Medicare on a small scale in order to inform broader policy.
    The Affordable Care Act includes a number of provisions, for 
example, the Medicare Shared Savings Program, designed to improve the 
quality of Medicare services, support innovation and the establishment 
of new payment models, better align Medicare payments with health care 
provider costs, strengthen Medicare program integrity, and put Medicare 
on a firmer financial footing.
    The Affordable Care Act created the Center for Medicare and 
Medicaid Innovation (Innovation Center). The Innovation Center was 
established by section 1115A of the Act (as added by section 3021 of 
the Affordable Care Act). The Innovation Center's mandate gives it 
flexibility within the parameters of section 1115A of the Act to select 
and test promising innovative payment and service delivery models. 
Congress created the Innovation Center for the purpose of testing 
innovative payment and service delivery models to reduce program 
expenditures while preserving or enhancing the quality of care provided 
to those individuals who receive Medicare, Medicaid, or CHIP benefits. 
See https://innovation.cms.gov/about/index.html. Models that have met 
those expectations may be expanded in scope through rulemaking up to a 
national scale.
    To better coordinate these models and demonstration projects and to 
avoid duplicative efforts and expenses, the former Office of Research, 
Development and Information, which oversaw statutory demonstrations and 
those under section 402 etc., was merged with the Innovation Center in 
early 2011. As a result, the Innovation Center oversees not only 
initiatives that are authorized under section 1115A of the Act, but 
also activities under several other authorities, including other 
provisions of the Affordable Care Act, and other laws and projects 
authorized by section 402 of the Social Security Amendments of 1967, as 
amended.
    The Innovation Center's portfolio of models has attracted 
participation from a broad array of health care providers, states, 
payers, and other stakeholders, and serves Medicare, Medicaid, and CHIP 
beneficiaries in all 50 states, the District of Columbia, and Puerto 
Rico. We estimate that over 4.7 million Medicare, Medicaid, and CHIP 
beneficiaries are or soon will be receiving care furnished by the more 
than 61,000 eligible clinicians participating in APMs tested by the CMS 
Innovation Center.
    Beyond the care improvements for these beneficiaries, Innovation 
Center models are affecting millions of additional Americans by 
engaging thousands of other health care providers, payers, and states 
in model tests and through quality improvement efforts across the 
country. Many payers other than CMS have implemented alternative 
payment arrangements or models, or have collaborated in

[[Page 28168]]

Innovation Center models. The participation of multiple payers in 
alternative delivery and payment models increases momentum for delivery 
system transformation and encourages efficiency for health care 
organizations.
    The Innovation Center works directly with other CMS components and 
colleagues throughout the federal government in developing and testing 
new payment and service delivery models. Other federal agencies with 
which the Innovation Center has collaborated include the Centers for 
Disease Control and Prevention (CDC), Health Resources and Services 
Administration (HRSA), Agency for Healthcare Research and Quality 
(AHRQ), Office of the National Coordinator for Health Information 
Technology (ONC), Administration for Community Living (ACL), Department 
of Housing and Urban Development (HUD), Administration for Children and 
Families (ACF), and the Substance Abuse and Mental Health Services 
Administration (SAMHSA). These collaborations help the Innovation 
Center effectively test new models and execute mandated demonstrations.

B. Current Reporting Programs and Regulations (Overview)

    The MACRA's passage has led to several changes with the existing 
Medicare PFS, various Medicare payment programs that tie payment to 
value, and the testing of alternative payment models. Specifically, the 
MACRA's enactment consolidated aspects of certain quality reporting and 
performance programs into the new MIPS, including the meaningful use of 
certified EHR technology (section 1848(o) of the Act), the PQRS 
(section 1848(k) and (m) of the Act, and the VM (section 1848(p) of the 
Act). The following section provides an overview of existing programs 
and the extent of their programs before and after the MACRA.
    Currently, the Medicare EHR Incentive Program has been divided into 
three progressive stages of meaningful use with certain specified 
requirements that EPs must meet in order to qualify for Medicare EHR 
incentive payments and avoid downward payment adjustments. Full 
achievement of these requirements designated an EP as a ``meaningful 
EHR user'' and made that EP eligible for incentive payments and not 
subject to downward payment adjustments. The MACRA's enactment altered 
the EHR Incentive Programs such that the existing Medicare payment 
adjustment for an EP under 1848(a)(7)(A) of the Act ends after CY 2018. 
Using certified EHR technology is included in MIPS as part of the 
advancing care information component of the overall performance score. 
Generally, the MACRA did not change hospital participation in the 
Medicare EHR Incentive Program or participation for EPs in the Medicaid 
EHR Incentive Program.
    PQRS, as set forth in sections 1848(a), (k), and (m) of the Act, is 
a quality reporting program that provides for incentive payments (which 
ended in 2014) and payment adjustments (which began in 2015) to EPs and 
group practices based on whether they satisfactorily report data on 
quality measures for covered professional services furnished during a 
specified reporting period or to EPs and group practices based on 
whether they satisfactorily participate in a qualified clinical data 
registry (QCDR). The MACRA ends the PQRS adjustment after CY 2018 and 
provides for the inclusion of various aspects of PQRS in MIPS as part 
of the quality component of the overall performance score.
    Section 1848(p) of the Act, as amended by the Affordable Care Act, 
required that we establish a VM that provides for differential payment 
under the Medicare PFS based upon the quality of care furnished 
compared to cost and apply it to specific physicians and groups of 
physicians as determined appropriate by the Secretary starting in 2015 
and to all physicians by 2017. In the CY 2013 PFS final rule with 
comment period (77 FR 69307), we discussed the goals of the VM and also 
established the specific principles that should govern the 
implementation of the VM. The MACRA sunsets the VM, ending it after CY 
2018 and establishing certain aspects of the VM as part of the resource 
use component of MIPS in CY 2019.

C. Overview of Section 101 of the MACRA

    Section 101 of the MACRA amended sections 1848(d) and (f) of the 
Act to repeal the SGR formula for updating Medicare PFS payment rates 
and substituted a series of specified annual update percentages. 
Section 101 goes on to establish a new methodology that ties annual PFS 
payment adjustments to value for MIPS eligible clinicians. Section 101 
also creates an incentive program to encourage participation by 
eligible clinicians in Advanced APMs.
    Section 1848(q) of the Act, as added by section 101(c) of the 
MACRA, requires establishment of the MIPS, applicable beginning with 
payments for items and services furnished on or after January 1, 2019, 
under which the Secretary is required to: (1) Develop a methodology for 
assessing the total performance of each MIPS eligible clinician 
according to performance standards for a performance period for a year; 
(2) using the methodology, provide a CPS for each MIPS eligible 
clinician for each performance period; and (3) use the CPS of the MIPS 
eligible clinician for a performance period for a year to determine and 
apply a MIPS adjustment factor (and, as applicable, an additional MIPS 
adjustment factor) to the MIPS eligible clinician for the year. Under 
section 1848(q)(2)(A) of the Act, a MIPS eligible clinician's CPS is 
determined using four performance categories: (1) Quality; (2) resource 
use; (3) CPIA; and (4) advancing care information. Section 1848(q)(10) 
of the Act requires the Secretary to consult with stakeholders (through 
a request for information (RFI) or other appropriate means) in carrying 
out the MIPS, including for the identification of measures and 
activities for each of the four performance categories under the MIPS, 
the methodology to assess each MIPS eligible clinician's total 
performance to determine their MIPS CPS, the methodology to specify the 
MIPS adjustment factor for each MIPS eligible clinician for a year, and 
the use of QCDRs for purposes of the MIPS.
    Section 1848(q)(11) of the Act, as added by section 101(c) of the 
MACRA, provides for technical assistance to MIPS eligible clinicians in 
small practices, rural areas, and practices located in geographic 
health professional shortage areas (HPSAs). In general, the section 
requires the Secretary to enter into contracts or agreements with 
appropriate entities (such as quality improvement organizations, 
regional extension centers (as described in section 3012(c) of the 
Public Health Service (PHS) Act), or regional health collaboratives) 
(such as those identified in section 1115A of the Act) to offer 
guidance and assistance to MIPS eligible clinicians in practices of 15 
or fewer eligible clinicians. Priority is to be given to such practices 
located in rural areas which we propose to define at Sec.  414.1305 to 
include clinicians in counties designated as Micropolitan or Non-Core 
Based Statistical Areas (CBSAs), using HRSA's 2014-2015 Area Health 
Resource File (http://datawarehouse.hrsa.gov/data/datadownload/ahrfdownload.aspx), HPSAs (as designated under section 332(a)(1)(A) of 
the PHS Act), medically underserved areas (MUAs), and practices with 
low composite scores, for the MIPS performance categories or in 
transitioning to the implementation of,

[[Page 28169]]

and participation in, an APM. Details regarding the technical 
assistance program are outside the scope of this proposed rule, and 
will be addressed in separate guidance.
    Section 101(e) of the MACRA encourages participation in APMs by 
eligible clinicians and other eligible clinicians, and promotes the 
development of PFPMs by creating the PTAC. Specifically, this section: 
(1) Creates a payment incentive that applies to eligible clinicians 
from 2019 through 2024 who are Qualifying APM Participants (QPs) during 
the respective performance years, and provides for a higher fee 
schedule update for eligible clinicians who are QPs for a year 
beginning in 2026; (2) requires the establishment of a process for 
stakeholders to propose PFPMs to an independent PTAC that will review, 
comment on, and provide recommendations to the Secretary on the 
proposed PFPMs; and (3) requires CMS to establish criteria for PFPMs 
for use by the PTAC in making comments and recommendations to the 
Secretary. Additionally, section 101(c)(1) of the MACRA exempts QPs 
from payment adjustments under MIPS.

D. Stakeholder Input

    In developing this proposed rule, in accordance with the law, we 
have sought feedback from stakeholders throughout the process such as 
in the 2016 Medicare PFS Proposed Rule; the Request for Information 
Regarding Implementation of the Merit-Based Incentive Payment System, 
Promotion of Alternative Payment Models, and Incentive Payments for 
Participation in Eligible Alternative Payment Models (hereafter 
referred to as the MIPS and APMs RFI); listening sessions; 
conversations with a wide number of stakeholders; and conversations 
with tribes and tribal officials through CMS' Tribal Technical Advisory 
Group. In addition, we note that the National Indian Health Board has 
requested an opportunity for consultation with CMS, as well as that we 
coordinate its standards with the Indian Health Service. Through the 
MIPS and APMs RFI published in the Federal Register on October 1, 2015 
(80 FR 59102, 59102-59113), the Secretary of Health and Human Services 
(the Secretary) solicited comments regarding implementation of certain 
aspects of the MIPS and broadly sought public comments on the topics in 
section 101 of the MACRA, including the incentive payments for 
participation in APMs and increasing transparency of PFPMs. We received 
a high number of public comments in response to the MIPS and APMs RFI 
from a broad range of sources including professional associations and 
societies, physician practices, hospitals, patient groups, and health 
IT vendors.
    We appreciate the high level of interest expressed by commenters 
and acknowledge their valued input throughout this proposed rule, 
providing summaries of RFI comments in relevant sections of this rule. 
In general, commenters supported the passage of regulations 
implementing the MACRA and maintain optimism as we move from fee-for-
service Medicare payment towards an enhanced focus on the quality and 
value of care. Public support for the MACRA focuses on the potential of 
a value-based program to provide enough flexibility to be applied 
meaningfully to physician practices and patient quality of care. 
Commenters cautioned us to avoid elements of prior reporting programs 
that have been perceived as too focused on the volume of measures 
reported rather than measure relevance and impact on treatment. 
Commenters also requested that we avoid implementing additional 
requirements on top of the fee-for-service system, which would increase 
the reporting and compliance burden for eligible clinicians. Commenters 
believe the underlying goal in establishing the MACRA should be to 
create a new program that combines a limited (yet meaningful) set of 
requirements with choices for health care providers on how to meet 
those requirements. Commenters requested that there be broad 
opportunities to participate in APMs and the development of new 
Advanced APMs, and that resources be made available to assist them in 
moving towards participation in APMs if they do not already 
participate. Commenters expressed eagerness to participate in Advanced 
APMs and to be a part of transforming care.
    Once again, we thank stakeholders for their considered responses 
through various venues including comments to the MIPS and APMs RFI. We 
intend to continue open communication with stakeholders (including 
consultation with tribes and tribal officials) on an ongoing basis, and 
we look forward to comments on the policies proposed in this rule.

II. Provisions of the Proposed Regulations

A. Establishing MIPS and the APM Incentive

    Section 1848(q) of the Act, as added by section 101(c) of the 
MACRA, requires establishment of the MIPS (see section I.C. of this 
proposed rule for additional background information). Section 101(e) of 
the MACRA promotes the development of, and participation in, APMs for 
eligible clinicians (see section I.C. of this proposed rule for 
additional background information). Further information will be 
provided in future rulemaking.

B. Program Principles and Goals

    Through the MACRA amendments, we believe the Congress sets broad 
goals to be accomplished intended to improve care and health outcomes 
for every American. More specifically, our goal with the Quality 
Payment Program is to continue to support health care quality, 
efficiency, and patient safety. MIPS promotes better care, healthier 
people, and smarter spending by evaluating MIPS eligible clinicians 
using a CPS that incorporates MIPS eligible clinicians' performance on 
quality, resource use, clinical practice improvement activities, and 
advancing care information. Under the incentives for participation in 
Advanced APMs, our goals, described in greater detail in section II.F. 
of this proposed rule, are to expand the opportunities for 
participation in APMs, maximize participation in current and future 
Advanced APMs, create clear and attainable standards for incentives, 
promote the continued flexibility in the design of APMs, and support 
multi-payer initiatives across the health care market. The Quality 
Payment Program will encourage more MIPS eligible clinicians to 
participate in Advanced APMs, which link quality and value to payment. 
The APM Incentive Payment for eligible clinicians who qualify as QPs 
will only be available through Advanced APMs, but it is a powerful 
incentive to increase participation in those APMs. MIPS eligible 
clinicians participating in APMs (who do not qualify as QPs) will 
receive favorable scoring under certain MIPS categories.
    Our strategic goals in developing the Quality Payment Program 
include: (1) Design a patient-centered approach to program development 
that leads to better, smarter, and healthier care; (2) develop a 
program that is meaningful, understandable, and flexible for 
participating clinicians; (3) design incentives that drive delivery 
system reform principles and participation in APMs; and (4) ensure 
close attention to CMS' excellence in implementation, effective 
communication with stakeholders and operational feasibility.

[[Page 28170]]

C. Changes to Existing Programs

1. Sunsetting of Current Payment Adjustment Programs
    Section 101(b) of the MACRA calls for the sunsetting of payment 
adjustments under three existing programs for Medicare enrolled 
physicians and other practitioners:
     The PQRS that incentivizes EPs to report on quality 
measures;
     The VM that provides for budget neutral, differential 
payment adjustment for EPs in physician groups and solo practices based 
on quality of care compared to cost; and
     The Medicare EHR Incentive Program for EPs that entails 
meeting certain requirements for the use of certified EHR technology.
    Accordingly, we propose to revise certain regulations associated 
with these programs. We are not proposing to delete these regulations 
entirely, as the final payment adjustments under these programs will 
not occur until the end of 2018. For PQRS, we propose to revise Sec.  
414.90(e) introductory text and Sec.  414.90(e)(1)(ii) to continue 
payment adjustments through 2018.
    Similarly, we are proposing to amend the regulation text at Sec.  
495.102(d) to remove references to the payment adjustment percentage 
for years after the 2018 payment adjustment year and add a terminal 
limit of the 2018 payment adjustment year.
    We are not proposing changes to 42 CFR part 414 subpart N--Value-
Based Payment Modifier Under the PFS (Sec.  414.1200-1285), at this 
time. These regulations are already limited to certain years.
    We invite comments on these proposed regulatory changes.
2. Meaningful Use Prevention of Information Blocking and Surveillance 
Demonstrations for MIPS Eligible Clinicians, EPs, Eligible Hospitals, 
and CAHs
    a. Cooperation With Surveillance and Direct Review of Certified EHR 
Technology
    We are proposing to require EPs, eligible hospitals, and CAHs to 
attest (as part of their demonstration of meaningful use under the 
Medicare and Medicaid EHR Incentive Programs) that they have cooperated 
with the surveillance of certified EHR technology under the ONC Health 
IT Certification Program, as authorized by 45 CFR part 170, subpart E. 
Similarly, we are proposing to require such an attestation from all 
eligible clinicians under the advancing care information performance 
category of MIPS, including eligible clinicians who report on the 
advancing care information performance category as part of an APM 
Entity group under the APM Scoring Standard, as discussed in section 
II.E.5.h of this proposed rule.
    On October 16, 2015, ONC published the 2015 Edition Health 
Information Technology (Health IT) Certification Criteria, 2015 Edition 
Base Electronic Health Record (EHR) Definition, and ONC Health IT 
Certification Program Modifications final rule (``2015 Edition final 
rule''). The final rule made changes to the ONC Health IT Certification 
Program that strengthen the testing, certification, and surveillance of 
health IT. In addition, the final rule clarified and expanded the 
responsibilities of ONC-Authorized Certification Bodies (ONC-ACBs) with 
respect to the surveillance of certified EHR technology and other 
health IT certified under the ONC Health IT Certification Program, 
including requirements for ONC-ACBs to conduct more frequent and more 
rigorous surveillance of certified technology and capabilities ``in the 
field'' (80 FR 62707). The purpose of in-the-field surveillance is to 
provide greater assurance that health IT meets certification 
requirements not only in a controlled testing environment but also when 
used by health care providers in actual production environments (80 FR 
62707).
    In addition to these changes, on March 2, 2016, ONC published the 
ONC Health IT Certification Program: Enhanced Oversight and 
Accountability proposed rule, which would expand ONC's role to 
strengthen oversight under the ONC Health IT Certification Program by 
providing a means for ONC to directly review and evaluate the 
performance of certified health IT in certain circumstances, such as in 
response to potential systemic or widespread issues, or in response to 
problems or issues that could pose a risk to public health or safety, 
compromise the security or privacy of patients' health information, or 
give rise to other exigencies (81 FR 11055).
    These efforts to strengthen surveillance and other oversight of 
certified health IT, including through expanded in-the-field 
surveillance and ONC direct review of technology and capabilities, are 
critical to the success of HHS programs and initiatives that require 
the use of certified health IT to improve health care quality and the 
efficient delivery of care. With respect to the use of certified EHR 
technology under the Medicare and Medicaid EHR Incentive Programs and 
the MIPS Program, effective surveillance and oversight is fundamental 
to providing basic confidence that such technology consistently meets 
applicable standards, implementation specifications, and certification 
criteria adopted by the Secretary when it is used by eligible 
clinicians, EPs, eligible hospitals, and CAHs, as well as by other 
persons with whom eligible clinicians, EPs, eligible hospitals, and 
CAHs need to exchange electronic health information to comply with 
program requirements. The need to ensure that technology consistently 
meets applicable standards, implementation specifications, and 
certification criteria is important both at the time it is certified 
and on an ongoing basis when it is implemented and used in the field by 
eligible clinicians, EPs, eligible hospitals, and CAHs in order to meet 
objectives and measures under the Medicare and Medicaid EHR Incentive 
Program or MIPS. Efforts to strengthen surveillance and oversight of 
certified EHR technology in the field will become even more important 
as the types and capabilities of certified EHR technology continue to 
evolve and with the onset of Stage 3 of the Medicare and Medicaid EHR 
Incentive Programs and MIPS, which include heightened requirements for 
sharing electronic health information with other providers and with 
patients using a broad range of certified EHR technology and other 
health IT.\3\ Finally, we note that effective surveillance and 
oversight of certified EHR technology is necessary if eligible 
clinicians, EPs, eligible hospitals, and CAHs are to be able to rely on 
certifications issued under the ONC Health IT Certification Program as 
the basis for selecting appropriate technologies and capabilities that 
support the use of certified EHR technology while avoiding potential 
implementation and performance issues.
---------------------------------------------------------------------------

    \3\ For example, EPs, eligible hospitals, and CAHs may meet the 
Stage 3 measure for care coordination (42 CFR 495.24(d)(6)) by 
providing patients with access to their health information through 
the use of an API that can be used by applications chosen by the 
patient and configured to the API in the provider's CEHRT. As 
another example, EPs, eligible hospitals, and CAHs must satisfy 
measures for health information exchange (Sec.  495.24(d)(7)) that 
require receiving and incorporating health information from other 
certified EHR technology.
---------------------------------------------------------------------------

    For all of these reasons, the effective surveillance and oversight 
of certified health IT, and certified EHR technology in particular, is 
necessary to enable eligible clinicians, EPs, eligible hospitals, and 
CAHs to demonstrate that they are using certified EHR technology in a 
meaningful manner as required by sections 1848(o)(2)(A)(i) and 
1886(n)(3)(A)(i) of the Act. Yet as ONC observed in the 2015 Edition 
final rule, such surveillance and oversight will not be effective 
unless EPs, eligible hospitals, and CAHs are actively

[[Page 28171]]

engaged and cooperate with the authorized surveillance and oversight of 
their technology, including by granting access to and assisting ONC and 
ONC-ACBs to observe the performance of production systems (80 FR 
62716).
    Accordingly, we are proposing that as part of demonstrating that it 
is using certified EHR technology in a meaningful manner, an eligible 
clinician, EP, eligible hospital, or CAH must demonstrate its 
cooperation with these authorized surveillance and oversight 
activities. We are proposing to revise the definition of a meaningful 
EHR user at Sec.  495.4, as well as the attestation requirements at 
Sec.  495.40(a)(2)(i)(H) and Sec.  495.40(b)(2)(i)(H) to require EPs, 
eligible hospitals, and CAHs to attest their cooperation with certain 
authorized health IT surveillance and direct review activities, 
described in more detail in this section of the rule, as part of 
demonstrating meaningful use under the Medicare and Medicaid EHR 
Incentive Programs. Similarly, we are proposing to include an identical 
attestation requirement in the submission requirements for eligible 
clinicians under the advancing care information performance category 
proposed at Sec.  414.1375.
    We propose that eligible clinicians, EPs, eligible hospitals, and 
CAHs would be required to attest that they have cooperated in good 
faith with the surveillance and ONC direct review of their health IT 
certified under the ONC Health IT Certification Program, as authorized 
by 45 CFR part 170, subpart E, to the extent that such technology meets 
(or can be used to meet) the definition of CEHRT. Under the terms of 
the attestation, such cooperation would include responding in a timely 
manner and in good faith to requests for information (for example, 
telephone inquiries, written surveys) about the performance of the 
certified EHR technology capabilities in use by the provider in the 
field. The provider's cooperation would also include accommodating 
requests (from ONC-Authorized Certification Bodies or from ONC) for 
access to the provider's certified EHR technology (and data stored in 
such certified EHR technology) as deployed by the provider in its 
production environment, for the purpose of carrying out authorized 
surveillance or direct review, and to demonstrate capabilities and 
other aspects of the technology that are the focus of such efforts, to 
the extent that doing so would not compromise patient care or be unduly 
burdensome for the eligible clinician, EP, eligible hospital, or CAH.
    We understand that cooperating with in-the-field surveillance may 
require prioritizing limited time and other resources. We note that ONC 
has established safeguards to minimize the burden of surveillance on 
eligible clinicians, EPs, eligible hospitals, and CAHs. In conducting 
randomized surveillance, ONC-ACBs must use consistent, objective, 
valid, and reliable methods to select the locations at which the 
surveillance will be performed (80 FR 62715). ONC-ACBs may also use 
appropriate sampling methodologies to minimize disruption to any 
individual provider or class of providers and to maximize the value and 
impact of surveillance activities for all providers and stakeholders 
(80 FR 62715). Moreover, if an ONC-ACB makes a good faith effort but is 
unable to complete in-the-field surveillance at a particular location, 
it may exclude the location and substitute a different location for 
surveillance (80 FR 62716).
    In addition, we note that ONC has clarified, in consultation with 
the Office for Civil Rights, that ONC-ACBs engaging in authorized 
surveillance of certified EHR technology under the ONC Health IT 
Certification Program meet the definition of a ``health oversight 
agency'' in the HIPAA Privacy Rule (45 CFR 164.501), and as such a 
health care provider is permitted to disclose protected health 
information (PHI) (without patient authorization and without a business 
associate agreement) to an ONC-ACB during the limited time and as 
necessary for the ONC-ACB to perform the required on-site surveillance 
of the certified EHR technology (45 CFR 164.512(d)(1)(iii)) (80 FR 
62716).\4\
---------------------------------------------------------------------------

    \4\ See also ONC Regulation FAQ #45 [12-13-045-1], available at 
http://www.healthit.gov/policy-researchers-implementers/45-question-12-13-045.
---------------------------------------------------------------------------

    For the foregoing reasons, we believe this proposal will support 
the surveillance and oversight of certified health IT, as necessary to 
support meaningful use of CEHRT for all eligible clinicians under the 
MIPS program, as well as EPs, eligible hospitals and CAHs under the 
Medicare and Medicaid EHR Incentive Programs, while ensuring that such 
surveillance or review does not create unnecessary or unreasonable 
burdens for health care providers or patients. We request public 
comment on this proposal.
b. Support for Health Information Exchange and the Prevention of 
Information Blocking
    To prevent actions that block the exchange of information, section 
106(b)(2)(A) of the MACRA amended section 1848(o)(2)(A)(ii) of the Act 
to require that, to be a meaningful EHR user, an EP must demonstrate 
that he or she has not knowingly and willfully taken action (such as to 
disable functionality) to limit or restrict the compatibility or 
interoperability of certified EHR technology. Section 106(b)(2)(B) of 
MACRA made corresponding amendments to section 1886(n)(3)(A)(ii) of the 
Act for eligible hospitals and, by extension, under section 1814(l)(3) 
of the Act for CAHs. Sections 106(b)(2)(A) and (B) of the MACRA provide 
that the manner of this demonstration is to be through a process 
specified by the Secretary, such as the use of an attestation. Section 
106(b)(2)(C) of the MACRA states that the demonstration requirements in 
these amendments shall apply to meaningful EHR users as of the date 
that is 1 year after the date of enactment, which would be April 16, 
2016.
    On December 16, 2014, in an explanatory statement accompanying the 
Consolidated and Further Continuing Appropriations Act,\5\ Congress 
urged ONC to take steps to decertify products that proactively block 
the sharing of information because those practices frustrate 
congressional intent, devalue taxpayer investments in certified EHR 
technology, and make certified EHR technology less valuable and more 
burdensome for eligible hospitals and eligible health care providers to 
use.\6\ Congress also asked for a detailed report on health information 
blocking, which ONC delivered on April 10, 2015. In the report, and 
based on the available evidence and its own experience, ONC found that 
some persons and entities--including some health care providers--are 
knowingly and unreasonably interfering with the exchange or use of 
electronic health information in ways that limit its availability and 
use to improve health and health care.\7\
---------------------------------------------------------------------------

    \5\ Pub. L. 113-235.
    \6\ 160 Cong. Rec. H9047, H9839 (daily ed. Dec. 11, 2014) 
(explanatory statement submitted by Rep. Rogers, chairman of the 
House Committee on Appropriations, regarding the Consolidated and 
Further Continuing Appropriations Act, 2015).
    \7\ ONC, Report to Congress on Health Information Blocking 
(April 10, 2015), available at https://www.healthit.gov/sites/default/files/reports/info_blocking_040915.pdf.
---------------------------------------------------------------------------

    Following these activities, on April 16, 2015, the MACRA was 
enacted, including section 106(b)(2), which amended sections 
1848(o)(2)(A)(ii) and 1886(n)(3)(A)(ii) of the Act, as discussed in 
this section of the rule. Prior to these amendments, to be treated as a 
meaningful EHR user, an EP, eligible hospital, or CAH had to 
demonstrate to

[[Page 28172]]

the satisfaction of the Secretary that its certified EHR technology was 
connected during the relevant EHR reporting period in a manner that 
provided, in accordance with law and standards applicable to the 
exchange of information, for the electronic exchange of health 
information to improve the quality of health care, such as promoting 
care coordination. As amended, respectively, by sections 106(b)(2)(A) 
and (B) of the MACRA, sections 1848(o)(2)(A)(ii) and 1886(n)(3)(A)(ii) 
of the Act now require that, in addition to demonstrating such 
connectivity, an eligible clinician, EP, eligible hospital, or CAH must 
also demonstrate that it did not knowingly and willfully take action to 
limit or restrict the compatibility or interoperability of the 
certified EHR technology.
    We believe that, at a minimum, such a demonstration would need to 
provide substantial assurance not only that the certified EHR 
technology was connected in accordance with applicable standards during 
the relevant EHR reporting period, but that the eligible clinician, EP, 
eligible hospital, or CAH acted in good faith to implement and use the 
certified EHR technology in a manner that supported and did not 
interfere with the electronic exchange of health information among 
health care providers and with patients to improve quality and promote 
care coordination. Accordingly, we are proposing that such a 
demonstration be made through an attestation comprising three 
statements related to health information exchange and information 
blocking, which are set forth in our proposal in this rule. We are 
proposing to revise the definition of a meaningful EHR user at Sec.  
495.4 and the attestation requirements at Sec.  495.40(a)(2)(i)(I) and 
Sec.  495.40(b)(2)(i)(I) to provide that, for attestations submitted on 
or after April 16, 2016, an EP, eligible hospital, or CAH under the 
Medicare and Medicaid EHR Incentive Programs must attest to this three-
part attestation. For the same reasons stated in this section of the 
rule, we are also proposing to require such an attestation from all 
eligible clinicians under the advancing care information performance 
category of MIPS, including eligible clinicians who report on the 
advancing care information performance category as part of an APM 
Entity group under the APM Scoring Standard, as discussed in section 
II.E.5.h of this proposed rule. As noted in this section, the 
attestation we are proposing would consist of three statements related 
to health information exchange and information blocking. First, the 
eligible clinician, EP, eligible hospital, or CAH would be required to 
attest that it did not knowingly and willfully take action (such as to 
disable functionality) to limit or restrict the compatibility or 
interoperability of certified EHR technology.
    Second, the eligible clinician, EP, eligible hospital, or CAH would 
be required to attest that it implemented technologies, standards, 
policies, practices, and agreements reasonably calculated to ensure, to 
the greatest extent practicable and permitted by law, that the 
certified EHR technology was, at all relevant times: connected in 
accordance with applicable law; compliant with all standards applicable 
to the exchange of information, including the standards, implementation 
specifications, and certification criteria adopted at 45 CFR part 170; 
implemented in a manner that allowed for timely access by patients to 
their electronic health information; (including the ability to view, 
download, and transmit this information) and implemented in a manner 
that allowed for the timely, secure, and trusted bi-directional 
exchange of structured electronic health information with other health 
care providers (as defined by 42 U.S.C. 300jj(3)), including 
unaffiliated providers, and with disparate certified EHR technology and 
vendors.
    Third, the eligible clinician, EP, eligible hospital, or CAH would 
be required to attest that it responded in good faith and in a timely 
manner to requests to retrieve or exchange electronic health 
information, including from patients, health care providers (as defined 
by 42 U.S.C. 300jj(3)), and other persons, regardless of the 
requestor's affiliation or technology vendor. We invite public comment 
on this proposal, including whether the foregoing statements could 
provide the Secretary with adequate assurances that an eligible 
clinician, EP, eligible hospital, or CAH has complied with the 
statutory requirements for information exchange. We also encourage 
public comment on whether there are additional facts or circumstances 
to which eligible clinicians, EPs, eligible hospitals, or CAHs should 
be required to attest, or whether there is additional information that 
they should be required to report.

D. Definitions

    At Sec.  414.1305, subpart O, we are proposing definitions for the 
following terms:
     Additional performance threshold.
     Advanced Alternative Payment Model (Advanced APM).
     Advanced APM Entity.
     Affiliated practitioner.
     Alternative Payment Model (APM).
     APM Entity.
     APM Entity group.
     APM Incentive Payment.
     Attestation.
     Attributed beneficiary.
     Attribution-eligible beneficiary.
     Certified Electronic Health Record Technology (CEHRT).
     Clinical Practice Improvement Activity (CPIA).
     CMS-approved survey vendor.
     CMS Web Interface.
     Composite performance score (CPS).
     Covered professional services.
     Eligible clinician.
     Episode payment model.
     Estimated aggregate payment amounts.
     Group.
     Health professional shortage areas (HPSA).
     High priority measure.
     Hospital-based MIPS eligible clinician.
     Incentive payment base period.
     Low-volume threshold.
     Meaningful EHR user for MIPS.
     Measure benchmark.
     Medicaid APM.
     Medical Home Model.
     Medicaid Medical Home Model.
     Merit-Based Incentive Payment System (MIPS).
     MIPS APM.
     MIPS Payment Year.
    MIPS eligible clinician.
     MIPS payment year.
     New Medicare-Enrolled MIPS eligible clinician.
     Non-patient-facing MIPS eligible clinician.
     Other Payer Advanced APM.
     Partial Qualifying APM Participant (Partial QP).
     Partial QP patient count threshold.
     Partial QP payment amount threshold.
     Participation List.
     Performance category score.
     Performance standards.
     Performance threshold.
     Qualified Clinical Data Registry (QCDR).
     Qualified registry.
     QP patient count threshold.
     QP payment amount threshold.
     QP Performance Period.
     Qualifying APM Participant (QP).
     Rural areas.
     Small practices.
     Threshold Score.
     Topped out measure.
    Some of these terms are new in conjunction with MIPS and APMs, 
while others are used in existing CMS programs. For the new proposed 
terms and definitions, we note that some of

[[Page 28173]]

them have been developed alongside proposed policies of this regulation 
while others are defined by statute. Specifically, the following terms 
and definitions were established by the MACRA: APM, CPIA, Eligible 
Alternative Payment Entity (which we have termed Advanced APM Entity), 
Eligible professional or EP (which we have termed eligible clinician), 
MIPS Eligible professional or MIPS EP (which we have termed MIPS 
eligible clinicians), Qualifying APM Participant, and Partial 
Qualifying APM Participant.
    We invite public comments on all of these proposed terms and 
definitions, and discuss most of them in detail in relevant sections of 
this preamble.

E. MIPS Program Details

1. MIPS Eligible Clinicians
    We believe a successful MIPS program fully equips clinicians 
identified as MIPS eligible clinicians with the tools and incentives to 
focus on improving health care quality, efficiency, and patient safety 
for all their patients. Under MIPS, MIPS eligible clinicians are 
incentivized to engage in proven improvement measures and activities 
that impact patient health and safety and are relevant for their 
patient population. One of our strategic goals in developing the MIPS 
program is to advance a program that is meaningful, understandable, and 
flexible for participating MIPS eligible clinicians. One way we believe 
this will be accomplished is by minimizing MIPS eligible clinicians' 
burden. We have made an effort to focus on policies that remove as much 
administrative burden as possible from MIPS eligible clinicians and 
their practices while still providing meaningful incentives for high-
quality, efficient care. In addition, we hope to balance practice 
diversity with flexibility to address varied MIPS eligible clinicians' 
practices. Examples of this flexibility include special consideration 
for non-patient-facing MIPS eligible clinicians, an exclusion from MIPS 
for eligible clinicians who do not exceed the low-volume threshold, and 
other proposals discussed below.
a. Definition of a MIPS Eligible Clinician
    Section 1848(q)(1)(C)(i) of the Act, as added by section 101(c)(1) 
of the MACRA, outlines the general definition of a MIPS eligible 
clinician for the MIPS program. Specifically, for the first and second 
year for which MIPS applies to payments (and the performance period for 
such years) a MIPS eligible clinician is defined as a physician (as 
defined in section 1861(r) of the Act), a physician assistant, nurse 
practitioner, and clinical nurse specialist (as such terms are defined 
in section 1861(aa)(5) of the Act), a certified registered nurse 
anesthetist (as defined in section 1861(bb)(2) of the Act), and a group 
that includes such professionals. The statute also provides flexibility 
to specify additional eligible clinicians (as defined in section 
1848(k)(3)(B) of the Act) as MIPS eligible clinicians in the third and 
subsequent years of MIPS. As discussed in section II.E.3. of this 
proposed rule, section 1848(q)(1)(C)(ii) and (v) of the Act specifies 
several exclusions from the definition of a MIPS eligible clinician. In 
addition, section 1848(q)(1)(A) of the Act requires the Secretary to 
permit any eligible clinician (as defined in section 1848(k)(3)(B) of 
the Act) who is not a MIPS eligible clinician the option to volunteer 
to report on applicable measures and activities under MIPS. Section 
1848(q)(1)(C)(vi) of the Act clarifies that a MIPS adjustment factor 
(or additional MIPS adjustment factor) will not be applied to an 
individual who is not a MIPS eligible clinician for a year, even if 
such individual voluntarily reports measures under MIPS.
    To implement the MIPS program we must first establish and define a 
MIPS eligible clinician in accordance with the statutory definition. We 
propose to define a MIPS eligible clinician at Sec.  414.1305 as a 
physician (as defined in section 1861(r) of the Act), a physician 
assistant, nurse practitioner, and clinical nurse specialist (as such 
terms are defined in section 1861(aa)(5) of the Act), a certified 
registered nurse anesthetist (as defined in section 1861(bb)(2) of the 
Act), and a group that includes such professionals. In addition, we 
propose that Qualifying APM Participants, Partial Qualifying APM 
Participants who do not report data under MIPS, low-volume threshold 
eligible clinicians, and new Medicare-enrolled eligible clinicians as 
defined at Sec.  414.1305 would be excluded from this definition per 
the statutory exclusions defined in section 1848(q)(1)(C)(ii) and (v) 
of the Act. We intend to consider using our authority under section 
1848(q)(1)(C)(i)(II) of the Act to expand the definition of MIPS 
eligible clinician to include additional eligible clinicians (as 
defined in section 1848(k)(3)(B) of the Act) through rulemaking in 
future years.
    In addition, in accordance with section 1848(q)(1)(A) and 
(q)(1)(C)(vi) of the Act, we propose to allow eligible clinicians who 
are not MIPS eligible clinicians as defined at proposed Sec.  414.1305 
the option to voluntarily report measures and activities for MIPS. We 
propose at Sec.  414.1310(d) that those eligible clinicians who are not 
MIPS eligible clinicians, but who voluntarily report on applicable 
measures and activities specified under MIPS, would not receive an 
adjustment under MIPS; however, they will have the opportunity to gain 
experience in the MIPS program. We are particularly interested in 
public comment regarding the feasibility and advisability of voluntary 
reporting in the MIPS program for entities such as Rural Health Clinics 
(RHCs) and/or Federally Qualified Health Centers (FQHCs), including 
comments regarding the specific technical issues associated with 
reporting that are unique to these health care providers. We anticipate 
some eligible clinicians that will not be MIPS eligible clinicians 
during the first 2 years of MIPS, such as physical and occupational 
therapists, clinical social workers, and others that have been 
reporting quality measures under the PQRS for a number of years, will 
want to have the ability to continue to report and gain experience 
under MIPS. We request comments on these proposals.
b. Non-Patient-Facing MIPS Eligible Clinicians
    Section 1848(q)(2)(C)(iv) of the Act requires the Secretary, in 
specifying measures and activities for a performance category, to give 
consideration to the circumstances of professional types (or 
subcategories of those types determined by practice characteristics) 
who typically furnish services that do not involve face-to-face 
interaction with a patient. To the extent feasible and appropriate, the 
Secretary may take those circumstances into account and apply 
alternative measures or activities that fulfill the goals of the 
applicable performance category to such non-patient-facing MIPS 
eligible clinicians. In carrying out these provisions, we are required 
to consult with non-patient-facing MIPS eligible clinicians.
    In addition, section 1848(q)(5)(F) of the Act allows the Secretary 
to re-weight MIPS performance categories if there are not sufficient 
measures and activities applicable and available to each type of MIPS 
eligible clinician. We assume many non-patient-facing MIPS eligible 
clinicians will not have sufficient measures and activities applicable 
and available to report under the performance categories under MIPS. We 
refer readers to section II.E.6. of this proposed rule to discuss how 
we address performance categories weighting for MIPS eligible 
clinicians for whom no measures exist in a given category.

[[Page 28174]]

    To establish policies surrounding non-patient-facing MIPS eligible 
clinicians, we must first define the term ``non-patient-facing.'' 
Currently, the PQRS, VM, and Medicare EHR Incentive Program include two 
existing policies for considering whether an EP is providing patient-
facing services. To determine, for purposes of PQRS, whether an EP had 
a ``face-to-face'' encounter with Medicare patients, we assess whether 
the EP billed for services under the PFS that are associated with face-
to-face encounters, such as whether an EP billed general office visit 
codes, outpatient visits, and surgical procedures. Under PQRS, if an EP 
bills for at least one service under the PFS during the performance 
period that is associated with face-to-face encounters and reports 
quality measures via claims or registries, then the EP is required to 
report at least one ``cross-cutting'' measure. EPs who do not meet 
these criteria are not required to report a cross-cutting measure. For 
the purposes of PQRS, telehealth services have not historically been 
included in the definition of face-to-face encounters. For more 
information, please see the CY 2016 PFS final rule for these 
discussions (80 FR 71140).
    In the Stage 2 final rule (77 FR 54098 through 54099), the Medicare 
EHR Incentive Program established a significant hardship exception from 
the meaningful use payment adjustment under section 1848(a)(7)(A) of 
the Act for EPs that lack face-to-face interactions with patients and 
those who lack the need to follow-up with patients. EPs with a primary 
specialty of anesthesiology, pathology or radiology listed in the 
Provider Enrollment, Chain, and Ownership System (PECOS) as of 6 months 
prior to the first day of the payment adjustment year automatically 
receive this hardship exemption (77 FR 54100). Codes associated with 
these specialties include 05 Anesthesiology, 22 Pathology, 30 
Diagnostic Radiology, 36 Nuclear Medicine, 94 Interventional Radiology. 
EPs with a different specialty are also able to request this hardship 
exception through the hardship application process. However, telehealth 
services could be counted by EPs who choose to include these services 
within the definition of ``seen by the EP'' for the purposes of 
calculating patient encounters with the EHR Incentive Program (77 FR 
53982).
    In the MIPS and APMs RFI, we sought comments on MIPS eligible 
clinicians that should be considered non-patient-facing MIPS eligible 
clinicians and the criteria we should use to identify these MIPS 
eligible clinicians. Commenters were split when it came to defining and 
identifying non-patient-facing MIPS eligible clinicians. Many took a 
specialty-driven approach. Commenters generally did not support use of 
enrollment specialty codes alone, which is the approach used by the 
Medicare EHR Incentive Program. Commenters indicated that these codes 
do not necessarily delineate between the same specialists who may or 
may not have patient-facing interaction. One example is cardiologists 
who specialize in cardiovascular imaging which is also coded as 
cardiology. On the other hand, as one commenter mentioned, physicians 
with enrollment specialty codes other than ``cardiology'' (for example, 
internal medicine) may perform cardiovascular imaging services. 
Therefore, using the enrollment specialty code for cardiology to 
identify clinicians who typically do not provide patient-facing 
services would be both over-inclusive and under-inclusive. Other 
commenters identified specialty types that they believe should be 
considered non-patient-facing MIPS eligible clinicians. Specific 
specialty types included radiologists, anesthesiologists, nuclear 
cardiology or nuclear medicine physicians, and pathologists. Others 
pointed out that certain MIPS eligible clinicians may be primarily non-
patient-facing MIPS eligible clinicians even though they practice 
within a traditionally patient-facing specialty. The MIPS and APMs RFI 
comments and listening sessions with medical societies representing 
non-patient-facing MIPS eligible clinicians specified radiology/
imaging, anesthesiology, nuclear cardiology and oncology, and pathology 
as inclusive of non-patient-facing MIPS eligible clinicians. Commenters 
noted that roles within specific types of specialties may need to be 
further delineated between patient-facing and non-patient-facing MIPS 
eligible clinicians. An illustrative list of specific types of 
clinicians within the non-patient-facing spectrum include:
     Pathologists who may be primarily dedicated to working 
with local hospitals to identify early indicators related to evolving 
infectious diseases;
     Radiologists who primarily provide consultative support 
back to a referring physician or provide image interpretation and 
diagnosis versus therapy;
     Nuclear medicine physicians who play an indirect role in 
patient care, for example as a consultant to another physician in 
proper dose administration; or
     Anesthesiologists who are primarily providing supervision 
oversight to Certified Registered Nurse Anesthetists.
    Some commenters believed that MIPS eligible clinicians should be 
defined as non-patient-facing MIPS eligible clinicians based on whether 
their billing indicates they provide face-to-face services. Commenters 
indicated that the use of specific HCPCS codes in combination with 
enrollment specialty codes, may be a more appropriate way to identify 
MIPS eligible clinicians that have no patient interaction.
    After reviewing current policies, we propose to define a non-
patient-facing MIPS eligible clinicians for MIPS at Sec.  414.1305 as 
an individual MIPS eligible clinician or group that bills 25 or fewer 
patient-facing encounters during a performance period. We consider a 
patient-facing encounter as an instance in which the MIPS eligible 
clinician or group billed for services such as general office visits, 
outpatient visits, and surgical procedure codes under the PFS. We 
intend to publish the proposed list of patient-facing encounter codes 
on a CMS Web site similar to the way we currently publish the list of 
face-to-face encounter codes for PQRS. This proposal differs from the 
current PQRS policy in two ways. First, it creates a minimum threshold 
for the quantity of patient-facing encounters that MIPS eligible 
clinicians or groups would need to furnish to be considered patient-
facing, rather than classifying MIPS eligible clinicians as patient-
facing based on a single patient-facing encounter. Second, this 
proposal includes telehealth services in the definition of patient-
facing encounters.
    We believe that setting the non-patient-facing MIPS eligible 
clinician threshold for individual MIPS eligible clinician or group at 
25 or fewer billed patient-facing encounters during a performance 
period is appropriate. We selected this threshold based on an analysis 
of non-patient-facing HCPCS codes billed by MIPS eligible clinicians. 
Using these codes and this threshold we identified approximately one 
quarter of MIPS eligible clinicians as non-patient-facing before MIPS 
exclusions, such as low-volume and newly-enrolled eligible clinician 
policies, were applied. The majority of clinicians enrolled in Medicare 
with specialties such as anesthesiology, nuclear medicine, and 
pathology were identified as non-patient-facing in this analysis. The 
addition of telemedicine to the analysis did not affect the outcome, as 
it created a less than 0.01 percent change in MIPS eligible clinicians 
categorized as non-patient-facing.

[[Page 28175]]

    Therefore, this proposed approach allows the definition of non-
patient-facing MIPS eligible clinicians, to include both MIPS eligible 
clinicians who practice within specialties traditionally considered 
non-patient-facing, as well as MIPS eligible clinicians who provide 
occasional patient-facing services that do not represent the bulk of 
their practices. This definition is also consistent with the statutory 
requirement that refers to professional types who typically furnish 
services that do not involve patient-facing interaction with a patient.
    We also propose to include telehealth services in the definition of 
patient-facing encounters. Various MIPS eligible clinicians use 
telehealth services as an innovative way to deliver care to 
beneficiaries and we believe these services, while not furnished in-
person, should be recognized as patient-facing. In addition, Medicare 
eligible telehealth services substitute for an in-person encounter and 
meet other site requirements under the PFS as defined at Sec.  410.78.
    The proposed addition of the encounter threshold for patient-facing 
MIPS eligible clinicians should minimize concerns that a MIPS eligible 
clinician could be misclassified as patient-facing as a result of 
providing occasional telehealth services that do not represent the bulk 
of their practice. Finally, this proposed definition of a non-patient-
facing MIPS eligible clinician for MIPS can be consistently used 
throughout the MIPS program to identify those MIPS eligible clinicians 
for whom certain proposed requirements for patient-facing MIPS eligible 
clinicians (such as reporting cross-cutting measures) may not be 
meaningful.
    We weighed several options when considering the appropriate 
definition of non-patient-facing MIPS eligible clinicians for MIPS; and 
some options were similar to those we considered in implementing the 
Medicare EHR Incentive Program. One option we considered was basing the 
non-patient-facing MIPS eligible clinician's definition on a set 
percentage of patient-facing encounters, such as 5 to 10 percent, that 
is tied to the same list of patient-facing encounter codes discussed in 
this section of the proposed rule. Another option we considered was the 
identification of non-patient-facing MIPS eligible clinicians for MIPS 
only by specialty, which might be a simpler approach. However, we do 
not consider this approach sufficient for identifying all the possible 
non-patient-facing MIPS eligible clinicians, as some patient-facing 
MIPS eligible clinicians practice in multi-specialty practices with 
non-patient-facing MIPS eligible clinician's practices with different 
specialties. We would likely have had to develop a separate process to 
identify non-patient-facing MIPS eligible clinicians in other 
specialties, whereas maintaining a single definition that is aligned 
across performance categories is simpler. Many comments from the MIPS 
and APMs RFI discouraged use of enrollment specialty alone. 
Additionally, we believe our proposal would allow us to more accurately 
identify MIPS eligible clinicians who are non-patient-facing by 
applying a threshold to recognize that a MIPS eligible clinician who 
furnishes almost exclusively non-patient-facing services should be 
treated as a non-patient-facing MIPS eligible clinicians despite 
furnishing a small number of patient-facing services. We seek comment 
on these alternative approaches.
    In the MIPS and APMs RFI, we also requested comments on what types 
of measures and/or CPIAs (new or from other payment systems) we should 
use to assess non-patient-facing MIPS eligible clinicians' performance 
and how we should apply the MIPS performance categories to non-patient-
facing MIPS eligible clinicians. Commenters were split on these 
subjects. A number of commenters stated that non-patient-facing MIPS 
eligible clinicians should be exempt from specific performance 
categories under MIPS or should be exempt from MIPS as a whole. 
Commenters who did not favor exemptions generally suggested that we 
focus on process measures and work with specialty societies to develop 
new, more clinically relevant measures for non-patient-facing MIPS 
eligible clinicians.
    We took these stakeholder comments into consideration. We note that 
section 1848(q)(2)(C)(iv) of the Act does not grant the Secretary 
discretion to exempt non-patient-facing MIPS eligible clinicians from a 
performance category entirely, but rather to apply to the extent 
feasible and appropriate alternative measures or activities that 
fulfill the goals of the applicable performance category. However, we 
have placed safeguards to ensure that MIPS eligible clinicians, 
including non-patient facing, that do not have sufficient alternative 
measures that are applicable and available in a performance category 
are scored appropriately. We propose to apply the Secretary's authority 
under section 1848(q)(5)(F) of the Act to reweight such performance 
categories score to zero if there is no performance category score or 
to lower the weight of the quality performance category score if there 
are not at least three scored measures. Please refer to section 
II.E.6.b.(2)(b) in this proposed rule for details on the reweighting 
proposals. Accordingly, we have proposed alternative requirements for 
non-patient-facing MIPS eligible clinicians across this proposed rule 
(see sections II.E.5.b. II.E.5.e. and II.E.5.f. of this proposed rule 
for more details). While non-patient-facing MIPS eligible clinicians 
will not be exempt from any performance category under MIPS, we believe 
these alternative requirements fulfill the goals of the applicable 
performance categories and are in line with the commenters' desire to 
ensure that non-patient-facing MIPS eligible clinicians are not placed 
at an unfair disadvantage under the new program. The requirements also 
build on prior program components in meaningful ways and are meant to 
help us appropriately assess and incentivize non-patient-facing MIPS 
eligible clinicians. We request comments on these proposals.
c. MIPS Eligible Clinicians Who Practice in Critical Access Hospitals 
Billing Under Method II (Method II CAHs)
    Section 1848(q)(6)(E) of the Act provides that the MIPS adjustment 
is applied to the amount otherwise paid under Part B for the items and 
services furnished by a MIPS eligible clinician during a year 
(beginning with 2019). In the case of MIPS eligible clinicians who 
practice in CAHs that bill under Method I (``Method I CAHs''), the MIPS 
adjustment would apply to payments made for items and services billed 
by MIPS eligible clinicians under the PFS, but it would not apply to 
the facility payment to the CAH itself. In the case of MIPS eligible 
clinicians who practice in Method II CAHs and have not assigned their 
billing rights to the CAH, the MIPS adjustment would apply in the same 
manner as for MIPS eligible clinicians who bill for items and services 
in Method I CAHs.
    Under section 1834(g)(2) of the Act, a Method II CAH bills and is 
paid for facility services at 101 percent of its reasonable costs and 
for professional services at 115 percent of such amounts as would 
otherwise be paid under this part if such services were not included in 
outpatient critical access hospital services. In the case of MIPS 
eligible clinicians who practice in Method II CAHs and have assigned 
their billing rights to the CAHs, those professional services would 
constitute ``covered professional services'' under section 
1848(k)(3)(A) of the Act because they are furnished by an eligible 
clinician

[[Page 28176]]

and payment is ``based on'' the PFS. Moreover, this is consistent with 
the precedent CMS has established by applying the PQRS and EHR-MU 
adjustments to Method II CAH payments. Therefore, we propose the MIPS 
adjustment does apply to Method II CAH payments under section 
1834(g)(2)(B) of the Act when MIPS eligible clinicians who practice in 
Method II CAHs have assigned their billing rights to the CAH. We 
request comments on this proposal.
d. MIPS Eligible Clinicians Who Practice in Rural Health Clinics (RHCs) 
and/or Federally Qualified Health Centers (FQHCs)
    As noted previously in this proposed rule, section 1848(q)(6)(E) of 
the Act provides that the MIPS adjustment is applied to the amount 
otherwise paid under Part B with respect to the items and services 
furnished by a MIPS eligible clinician during a year. Some eligible 
clinician s may not receive MIPS adjustments due to their billing 
methodologies. If a MIPS eligible clinician furnishes items and 
services in an RHC and/or FQHC and the RHC and/or FQHC bills for those 
items and services under the RHC's or FQHC's all-inclusive payment 
methodology, the MIPS adjustment would not apply to the facility 
payment to the RHC or FQHC itself. However, if a MIPS eligible 
clinician furnishes other items and services in an RHC and/or FQHC and 
bills for those items and services under the PFS, the MIPS adjustment 
would apply to payments made for items and services. Accordingly, the 
MIPS eligible clinician would need to meet the applicable MIPS 
reporting requirements to avoid a downward MIPS adjustment to payments 
made for items and services billed by the MIPS eligible clinician under 
the PFS. Therefore, we propose services rendered by an eligible 
clinician that are payable under the RHC or FQHC methodology would not 
be subject to the MIPS payments adjustments. However, these eligible 
clinicians have the option to voluntarily report on applicable measures 
and activities for MIPS and the data received would not be used to 
assess their performance for the purpose of the MIPS adjustment. We 
request comments on this proposal.
e. Group Practice (Group)
    Section 1848(q)(1)(D) of the Act, requires the Secretary to 
establish and apply a process that includes features of the PQRS group 
practice reporting option (GPRO) established under section 
1848(m)(3)(C) of the Act for MIPS eligible clinicians in a group for 
purposes of assessing performance in the quality performance category. 
In addition, it gives the Secretary the discretion to do so for the 
other three performance categories. Additionally, we will assess 
performance either for individual MIPS eligible clinicians or for 
groups. As discussed in section II.E.2.b of this proposed rule, we 
propose to define a group at Sec.  414.1305 as a single Taxpayer 
Identification Number (TIN) with two or more MIPS eligible clinicians, 
as identified by their individual National Provider Identifier (NPI), 
who have reassigned their Medicare billing rights to the TIN. Also, as 
outlined in section II.E.2.c. of this proposed rule, we propose to 
define an APM Entity group at Sec.  414.1305 identified by a unique APM 
participant identifier.
2. MIPS Eligible Clinician Identifier
    To support MIPS eligible clinicians reporting to a single 
comprehensive and cohesive MIPS program, we need to align the technical 
reporting requirements from PQRS, VM, and EHR-MU into one program. This 
requires an appropriate MIPS eligible clinician identifier. We 
currently use a variety of identifiers to assess an individual eligible 
clinician or group under different programs. For example, under the 
PQRS for individual reporting, CMS uses a combination of TIN and NPI to 
assess eligibility and participation, where each unique TIN and NPI 
combination is treated as a distinct eligible clinician and is 
separately assessed for purposes of the program. Under the PQRS GPRO, 
eligibility and participation are assessed at the TIN level. Under the 
Medicare EHR Incentive Program, we utilize the NPI to assess 
eligibility and participation. And under the VM, performance and 
payment adjustments are assessed at the TIN level. Additionally, for 
APMs such as the Pioneer Accountable Care Organization (ACO) Model, we 
also assign a program-specific identifier (in the case of the Pioneer 
ACO Model, an ACO ID) to the organization(s), and associate that 
identifier with individual eligible clinicians who are, in turn, 
identified through a combination of a TIN and an NPI.
    In the MIPS and APMs RFI, we sought comments on which specific 
identifier(s) should be used to identify a MIPS eligible clinician for 
purposes of determining eligibility, participation, and performance 
under the MIPS performance categories. In addition, we requested 
comments pertaining to what safeguards should be in place to ensure 
that MIPS eligible clinicians do not switch identifiers to avoid being 
considered ``poor-performing'' and comments on what safeguards should 
be in place to address any unintended consequences, if the MIPS 
eligible clinician identifier were a unique TIN/NPI combination, to 
ensure an appropriate assessment of the MIPS eligible clinician's 
performance. In the MIPS and APMs RFI, we sought comment on using a 
MIPS eligible clinician's TIN, NPI, or TIN/NPI combination as potential 
MIPS eligible clinician identifiers, or creating a unique MIPS eligible 
clinician identifier. The commenters did not demonstrate a consensus on 
a single best identifier.
    Commenters favoring the use of the MIPS eligible clinician's TIN 
recommended that MIPS eligible clinicians should be associated with the 
TIN used for receiving payment from CMS claims. They further commented 
that this approach will deter MIPS eligible clinicians from ``gaming'' 
the system by switching to a higher performing group. Under this 
approach, commenters suggest that MIPS eligible clinicians who bill 
under more than one TIN can be assigned the performance and payment 
adjustment for the primary practice based upon majority of dollar 
amount of claims or encounters from the prior year.
    Other commenters supported using unique TIN and NPI combinations to 
identify MIPS eligible clinicians. Commenters suggested many eligible 
clinicians are familiar with using TIN and NPI together from PQRS and 
other CMS programs. Commenters also noted this approach can calculate 
performance for multiple unique TIN/NPI combinations for those MIPS 
eligible clinicians who practice under more than one TIN. Commenters 
who supported the TIN/NPI also believe this approach enables greater 
accountability for individual MIPS eligible clinicians beyond what 
might be achieved when using TIN as an identifier and would provide a 
safeguard from MIPS eligible clinicians changing their identifier to 
avoid payment penalties.
    Some commenters supported the use of only the NPI as the MIPS 
identifier. They believe this approach would best provide for 
individual accountability for quality in MIPS while minimizing 
potential confusion because providers do not generally change their NPI 
over time. Supporters of using the NPI only as the MIPS identifier also 
commented that this approach would be simplest for administrative 
purposes. These commenters also note the continuity inherent with the 
NPI would address the safeguard issue of providers

[[Page 28177]]

attempting to change their identifier for MIPS performance purposes.
    In the MIPS and APMs RFI, we also solicited feedback on the 
potential for creating a new MIPS identifier for the purposes of 
identifying MIPS eligible clinicians within the MIPS program. In 
response, many commenters indicated they would not support a new MIPS 
identifier. Commenters generally expressed concern that a new 
identifier for MIPS would only add to administrative burden, create 
confusion for MIPS eligible clinicians and increase reporting errors.
    After reviewing the comments, we are not proposing to create a new 
MIPS eligible clinician identifier. However, we appreciate the various 
ways a MIPS eligible clinician may engage with MIPS, either 
individually or through a group. Therefore, we are proposing to use 
multiple identifiers that allow MIPS eligible clinicians to be measured 
as an individual or collectively through a group's performance. We also 
propose that the same identifier be used for all four performance 
categories; for example, if a group is submitting information 
collectively, then it must be measured collectively for all four MIPS 
performance categories: Quality, resource use, CPIA, and advancing care 
information. As discussed later in the CPS methodology section II.E.6. 
of this proposed rule, while we have multiple identifiers for 
participation and performance, we proposed to use a single identifier, 
TIN/NPI, for applying the payment adjustment, regardless of how the 
MIPS eligible clinician is assessed. Specifically, if the MIPS eligible 
clinician is identified for performance only using the TIN, when 
applying the payment adjustment we propose to use the TIN/NPI. We 
request comments on these proposals.
a. Individual Identifiers
    We propose to use a combination of billing TIN/NPI as the 
identifier to assess performance of an individual MIPS eligible 
clinician. Similar to PQRS, each unique TIN/NPI combination would be 
considered a different MIPS eligible clinician, and MIPS performance 
would be assessed separately for each TIN under which an individual 
bills. While we considered using the NPI only, we believe TIN/NPI is a 
better approach for MIPS. Both TIN and NPI are needed for payment 
purposes and using a combination of billing TIN/NPI as the MIPS 
eligible clinician identifier allows us to match MIPS performance and 
payment adjustments with the appropriate practice, particularly for 
MIPS eligible clinicians that bill under more than one TIN. In 
addition, using TIN/NPI also provides the flexibility to allow 
individual MIPS eligible clinician and group reporting, as the group 
identifiers being proposed also include TIN as part of the identifier. 
We recognize that TIN/NPI is not a static identifier and can change if 
an individual MIPS eligible clinician changes practices and/or if a 
group merges with another between the performance period and payment 
adjustment period. Section II.E.5.h. of this proposed rule describes in 
more detail how we propose to match performance in cases where the TIN/
NPI changes. We request comments on this proposal.
b. Group Identifiers for Performance
    We propose the following way a MIPS eligible clinician may have 
their performance assessed as part of a group under MIPS. We propose to 
use a group's billing TIN to identify a group. This approach has been 
used as a group identifier for both PQRS and VM. The use of the TIN 
would significantly reduce the participation burden that could be 
experienced by large groups. Additionally, the utilization of the TIN 
benefits large and small practices by allowing such entities to submit 
performance data one time for their group and develop systems to 
improve performance. Groups that report on quality performance measures 
through certain data submission methods must register in order to 
participate in MIPS as described in section II.E.5.b. of this proposed 
rule.
    We are proposing to codify the definition of a group at Sec.  
414.1305 as a group that would consist of a single TIN with two or more 
MIPS eligible clinicians (as identified by their individual NPI) who 
have reassigned their billing rights to the TIN. We request comments on 
this proposal.
c. APM Entity Group Identifier for Performance
    We propose the following way to identify a group to support APMs 
(see section II.F.5.b. of this proposed rule). To ensure we have 
accurately captured all of the eligible clinicians identified as 
participants that are participating in the APM Entity, we propose that 
each eligible clinician who is a participant of an APM Entity would be 
identified by a unique APM participant identifier. The unique APM 
participant identifier would be a combination of four identifiers: (1) 
APM Identifier (established by CMS; for example, XXXXXX); (2) APM 
Entity identifier (established under the APM by CMS; for example, 
AA00001111); (3) TIN(s) (9 numeric characters; for example, XXXXXXXXX); 
(4) EP NPI (10 numeric characters; for example, 1111111111). For 
example, an APM participant identifier could be APM XXXXXX, APM Entity 
AA00001111, TIN-XXXXXXXXX, NPI-11111111111.
    We are proposing to codify the definition of an APM Entity group at 
Sec.  414.1305 as an APM Entity identified by a unique APM participant 
identifier. We request comments on these proposals. See section 
II.E.5.h. of this rule for proposed policies regarding requirements for 
APM Entity groups under MIPS.
3. Exclusions
a. New Medicare-Enrolled Eligible Clinician
    Section 1848(q)(1)(C)(v) of the Act provides that in the case of a 
professional who first becomes a Medicare-enrolled eligible clinician 
during the performance period for a year (and had not previously 
submitted claims under Medicare either as an individual, an entity, or 
a part of a physician group or under a different billing number or tax 
identifier), that the eligible clinician will not be treated as a MIPS 
eligible clinician until the subsequent year and performance period for 
that year. In addition, section 1848(q)(1)(C)(vi) of the Act clarifies 
that individuals who are not deemed MIPS eligible clinicians for a year 
will not receive a MIPS adjustment factor (or additional MIPS 
adjustment factor). Accordingly, we propose at Sec.  414.1305 that a 
new Medicare-enrolled eligible clinician be defined as a professional 
who first becomes a Medicare-enrolled eligible clinician within the 
PECOS during the performance period for a year and who has not 
previously submitted claims as a Medicare-enrolled eligible clinician 
either as an individual, an entity, or a part of a physician group or 
under a different billing number or tax identifier. These eligible 
clinicians will not be treated as a MIPS eligible clinician until the 
subsequent year and the performance period for such subsequent year. As 
discussed in section II.E.4. of this proposed rule, we are proposing 
that the MIPS performance period would be the calendar year (January 1 
through December 31) 2 years prior to the year in which the MIPS 
adjustment is applied. For example, an eligible clinician who newly 
enrolls in Medicare within PECOS in 2017 would not be required to 
participate in MIPS in 2017, and he or she would not receive a MIPS 
adjustment in 2019. The same eligible clinician would be required to 
participate in MIPS in 2018 and would

[[Page 28178]]

receive a MIPS adjustment in 2020, and so forth. In addition, in the 
case of items and services furnished during a year by an individual who 
is not an MIPS eligible clinician, there will not be a MIPS adjustment 
factor (or additional MIPS adjustment factor) applied for that year. We 
also propose at Sec.  414.1310(d) that in no case would a MIPS 
adjustment factor (or additional MIPS adjustment factor) apply to the 
items and services furnished by new Medicare-enrolled eligible 
clinicians.
    We request comments on these proposals.
b. Qualifying APM Participants (QP) and Partial Qualifying APM 
Participant (Partial QP)
    Sections 1848(q)(1)(C)(ii)(I) and (II) of the Act provide that the 
definition of a MIPS eligible clinician does not include, for a year, 
an eligible clinician who is a Qualifying APM Participant (QP) (as 
defined in section 1833(z)(2) of the Act) or a Partial Qualifying APM 
Participant (Partial QP) (as defined in section 1848(q)(1)(C)(iii) of 
the Act) who does not report on the applicable measures and activities 
that are required under MIPS. Section II.F.5. of this proposed rule 
provides detailed information on the determination of QPs and Partial 
QPs.
    We propose that the definition of a MIPS eligible clinician at 
Sec.  414.1310 does not include qualifying APM participants (defined at 
Sec.  414.1305) and Partial QPs defined at Sec.  414.1305 who do not 
report on applicable measures and activities that are required to be 
reported under MIPS for any given performance period. Partial QPs will 
have the option to elect whether or not to report under MIPS, which 
determines whether or not they will be subject to MIPS adjustments. 
Please refer to the section II.F.5.c. of this proposed rule where this 
election is discussed in greater detail. We request comments on this 
proposal.
c. Low-Volume Threshold
    Section 1848(q)(1)(C)(ii)(III) of the Act provides that the 
definition of a MIPS eligible clinician does not include MIPS eligible 
clinicians who are below the low-volume threshold selected by the 
Secretary under section 1848(q)(1)(C)(iv) of the Act for a given year. 
Section 1848(q)(1)(C)(iv) of the Act requires the Secretary to select a 
low-volume threshold to apply for the purposes of this exclusion which 
may include one or more of the following: (1) The minimum number, as 
determined by the Secretary, of Part B-enrolled individuals who are 
treated by the MIPS eligible clinician for a particular performance 
period; (2) the minimum number, as determined by the Secretary, of 
items and services furnish to Part B-enrolled individuals by the MIPS 
eligible clinician for a particular performance period; and (3) the 
minimum amount, as determined by the Secretary, of allowed charges 
billed by the MIPS eligible clinician for a particular performance 
period.
    We propose at Sec.  414.1305 to define MIPS eligible clinicians or 
groups who do not exceed the low-volume threshold as an individual MIPS 
eligible clinician or group who, during the performance period, have 
Medicare billing charges less than or equal to $10,000 and provides 
care for 100 or fewer Part B-enrolled Medicare beneficiaries. We 
believe this strategy is value-oriented as it retains as MIPS eligible 
clinicians those MIPS eligible clinicians who are treating relatively 
few beneficiaries, but engage in resource intensive specialties, or 
those treating many beneficiaries with relatively low-priced services. 
By requiring both criteria be met, we can meaningfully measure the 
performance and drive quality improvement across the broadest range of 
MIPS eligible clinician types and specialties. Conversely, it excludes 
MIPS eligible clinicians who do not have a substantial quantity of 
interactions with Medicare beneficiaries or furnish high cost services.
    In developing this proposal we considered using items and services 
furnished to Part B-enrolled individuals by the MIPS eligible clinician 
for a particular performance period rather than patients but a review 
of the data reflected there were nominal differences between the two 
methods. We plan to monitor the proposed requirement and anticipate 
that the specific thresholds will evolve over time. We request comments 
on this proposal including alternative patient threshold, case 
thresholds, and dollar values.
d. Group Reporting
(1) Background
    As noted above, section 1848(q)(1)(D) of the Act, requires the 
Secretary to establish and apply a process that includes features of 
the PQRS group practice reporting option (GPRO) established under 
section 1848(m)(3)(C) of the Act for MIPS eligible clinicians in a 
group for the purpose of assessing performance in the quality category 
and give the Secretary the discretion to do so for the other 
performance categories. The process established for purposes of MIPS 
must, to the extent practicable, reflect the range of items and 
services furnished by the MIPS eligible clinicians in the group. We 
believe this means that the process established for purposes of MIPS 
should, to the extent practicable, encompass elements that enable MIPS 
eligible clinicians in a group to meet reporting requirements that 
reflect the range of items and services furnished by the MIPS eligible 
clinicians in the group. At Sec.  414.1310(e) we propose requirements 
for groups. For purposes of section 1848(q)(1)(D) of the Act, at Sec.  
414.1310(e)(1) we propose the following way for individual MIPS 
eligible clinicians to have their performance assessed as a group: As 
part of a single TIN associated with two or more MIPS eligible 
clinicians, as identified by a NPI, that have their Medicare billing 
rights reassigned to the TIN (as discussed further in section II.E.1.f. 
of this proposed rule).
    In order to have its performance assessed as a group, at Sec.  
414.1310(e)(2) we propose a group must meet the proposed definition of 
a group at all times during the performance period for the MIPS payment 
year. Additionally, at Sec.  414.1310(e)(3) we propose in order to have 
their performance assessed as a group, individual MIPS eligible 
clinicians within a group must aggregate their performance data across 
the TIN. At Sec.  414.1310(e)(3), we propose a group that elects to 
have its performance assessed as a group would be assessed as a group 
across all four MIPS performance categories. For example, if a group 
submits data for the quality performance category as a group, CMS would 
assess them as a group for the remaining three performance categories. 
We solicit public comments on the proposal regarding how groups will be 
assessed under MIPS.
(2) Registration
    Under the PQRS, groups are required to complete a registration 
process to participate in PQRS as a group. During the implementation 
and administration of PQRS, we received feedback from stakeholders 
regarding the registration process for the various methods available 
for data submission. Stakeholders indicated that the registration 
process was burdensome and confusing. Additionally, we discovered that 
during the registration process when groups are required to select 
their group submission mechanism, groups sometimes selected the option 
not applicable to their group, which has created issues surrounding the 
mismatch of data. Unreconciled data mismatching can impact the quality 
of data. In order to address this issue, we are proposing to eliminate 
a registration process for groups submitting data using third party 
entities. When groups

[[Page 28179]]

submit data utilizing third party entities, such as a qualified 
registry, health IT vendor, or QCDR, we are able to obtain group 
information from the third party entity and discern whether the data 
submitted represents group submission or individual submission once the 
data is submitted.
    At Sec.  414.1310(e)(5), we propose that a group must adhere to an 
election process established and required by CMS, as described below. 
We do not propose to require groups to register to have their 
performance assessed as a group except for groups submitting data on 
performance measures via participation in the CMS Web Interface or 
groups electing to report the Consumer Assessment of Healthcare 
Providers and Systems (CAHPS) for MIPS survey for the quality 
performance category as described further in section II.E.5.b. of this 
proposed rule. For all other data submission methods, groups must work 
with appropriate third party entities to ensure the data submitted 
clearly indicates that the data represent a group submission rather 
than an individual submission. In order for groups to elect 
participation via the CMS Web Interface or administration of the CAHPS 
for MIPS survey, we propose that such groups must register by June 30 
of the applicable 12-month performance period (that is, June 30, 2017, 
for performance periods occurring in 2017). For the criteria regarding 
group reporting applicable to the four MIPS performance categories, see 
section II.E.5.a. of this proposed rule.
e. Virtual Groups
(1) Implementation
    Section 1848(q)(5)(I) of the Act establishes the use of voluntary 
virtual groups for certain assessment purposes. The statute requires 
the establishment and implementation of a process that allows an 
individual MIPS eligible clinician or a group consisting of not more 
than 10 MIPS eligible clinicians to elect to form a virtual group with 
at least one other such individual MIPS eligible clinician or group of 
not more than 10 MIPS eligible clinicians for a performance period of a 
year. As determined in statute, individual MIPS eligible clinicians and 
groups forming virtual groups are required to make such election prior 
to the start of the applicable performance period under MIPS and cannot 
change their election during the performance period. As discussed in 
section II.E.4. of this proposed rule, we are proposing that the 
performance period would be based on a calendar year.
    As we assessed the timeline for the establishment and 
implementation of virtual groups and applicable election process and 
requirements for the first performance period under MIPS, we identified 
significant barriers regarding the development of a technological 
infrastructure required for successful implementation and the 
operationalization of such provisions that would negatively impact the 
execution of virtual groups as a conducive option for MIPS eligible 
clinicians or groups. The development of an electronic system before 
policies are finalized poses several risks, particularly relating to 
the impediments of completing and adequately testing the system before 
execution and assuring that any change in policy made during the 
rulemaking process are reflected in the system and operationalized 
accordingly. We believe that it would be exceedingly difficult to make 
a successful system to support the implementation of virtual groups and 
given these factors, such implementation would compromise not only the 
integrity of the system, but the intent of the policies.
    Additionally, we recognize that it would be impossible for us to 
develop an entire infrastructure for electronic transactions pertaining 
to an election process, reporting of data, and performance measurement 
before the start of the performance period beginning on January 1, 
2017. Moreover, the actual implementation timeframe would be more 
condensed given that the development, testing, and execution of such a 
system would need to be completed months in advance of the beginning of 
the performance period in order to provide MIPS eligible clinicians and 
groups with an election period.
    During the implementation and ongoing functionality of other 
programs such as PQRS, Medicare EHR Incentive Program, and VM, we 
received feedback from stakeholders regarding issues they encountered 
when submitting reportable data for these programs. With virtual groups 
as a new option, we want to minimize potential issues for end-users and 
implement a system that encourages and enables MIPS eligible clinicians 
and groups to participate in a virtual group. A web-based registration 
process, which would simplify and streamline the process for 
participation, is our preferred approach. Given the aforementioned 
dynamics discussed in this section, implementation for the calendar 
year 2017 performance period is infeasible as a result of the 
insufficient timeframe to develop a web-based registration process. We 
have assessed alternative approaches for the first year only, such as 
an email registration process, but believe that there are limitations 
and potential risks for numerous errors, such as submitted information 
being incomplete or not in the required format. A manual verification 
process would cause a significant delay in verifying registration due 
to the lack of an automated system to ensure the accuracy of the type 
of information submitted that is required for registration. We believe 
that an email registration process could become cumbersome and a burden 
for groups to pursue participation in a virtual group. Implementation 
of a web-based registration system for calendar year 2018 would provide 
the necessary time to establish and implement an election process and 
requirements applicable to virtual groups, and enable proper system 
development and operations. We intend to implement virtual groups for 
the 2018 calendar year performance period and we intend to address all 
of the requirements pertaining to virtual groups in future rulemaking. 
We request comments on factors we should consider regarding the 
establishment and implementation of virtual groups.
(2) Election Process
    Section 1848(q)(5)(I)(iii)(I) of the Act provides that the election 
process must occur prior to the performance period and may not be 
changed during the performance period. We propose to establish an 
election process that would end on June 30 of a calendar year preceding 
the applicable performance period. During the election process, we 
propose that individual MIPS eligible clinicians and groups electing to 
be a virtual group would be required to register in order to submit 
reportable data. Virtual groups would be assessed across all four MIPS 
performance categories. In future rulemaking, we intend to address all 
elements relating to the election process. We solicit public comments 
on this proposal. Future rulemaking will outline the criteria and 
requirements regarding the formation of virtual groups.
4. MIPS Performance Period
    MIPS incorporates many of the requirements of several programs into 
a single, comprehensive program. This consolidation includes key policy 
goals as common themes across multiple categories such as quality 
improvement, patient and family engagement, and care coordination 
through interoperable health information exchange. However, each of 
these legacy programs included different eligibility requirements, 
reporting periods, and systems for

[[Page 28180]]

providers seeking to participate. This means that we must balance 
potential impacts of changes to systems and technical requirements in 
order to successfully synchronize reporting, as noted in the discussion 
regarding the definition of a MIPS eligible clinician in section 
II.E.1.a. of this proposed rule. We must take operational feasibility, 
systems impacts, and education and outreach on participation 
requirements into account in developing technical requirements for 
participation. One area where this is particularly important is in the 
definition of a performance period.
    MIPS applies to payments for items and services furnished on or 
after January 1, 2019. Section 1848(q)(4) of the Act requires the 
Secretary to establish a performance period (or periods) for a year 
(beginning with 2019). Such performance period (or periods) must begin 
and end prior to such year and be as close as possible to such year. In 
addition, section 1848(q)(7) of the Act provides that, not later than 
30 days prior to January 1 of the applicable year, the Secretary must 
make available to each MIPS eligible clinician the MIPS adjustment 
(and, as applicable, the additional MIPS adjustment) applicable to the 
MIPS eligible clinician for items and services furnished by the MIPS 
eligible clinician during the year.
    We considered various factors when developing the policy for the 
MIPS performance period. Stakeholders have stated that having a 
performance period as close to when payments are adjusted is 
beneficial, even if such period would be less than a year. We have also 
received feedback from stakeholders that they prefer having a 1 year 
performance period and have further suggested that the performance 
period start during the calendar year. For example, having the 
performance period occurring from July 1 through June 30. We 
additionally considered operational factors, such as that a 1 year 
performance period may be beneficial for all four performance 
categories because many measures and activities cannot be reported in a 
shorter time frame. We also considered that data submission activities 
and claims for items and services furnished during the 1 year 
performance period (which could be used for claims- or administrative 
claims-based quality or resource use measures) may not be fully 
processed until the following year.
    These circumstances will require adequate lead time to collect 
performance data, assess performance, and compute the MIPS adjustment 
so the applicable MIPS adjustment can be made available to each MIPS 
eligible clinician at least 30 days prior to when the payment 
adjustment is applied each year. For 2019, these actions will occur 
during 2018. In other payment systems, we have used claims that are 
processed within a specified time period after the end of the 
performance period, such as 60 or 90 days, for assessment of 
performance and application of the payment adjustment. For MIPS, we 
propose at Sec.  414.1325(g)(2) to use claims that are processed within 
90 days, if operationally feasible, after the end of the performance 
period for purposes of assessing performance and computing the MIPS 
payment adjustment. If we determine that it is not operationally 
feasible to have a claims data run-out for the 90-day timeframe, then 
we would utilize a 60-day duration.
    This proposal does not affect the performance period per se, but 
rather the deadline by which claims for items and services furnished 
during the performance period need to be processed for those items and 
services to be included in our calculation. To the extent that claims 
are used for submitting data on MIPS measures and activities to us, 
such claims would have to be processed by no later than 90 days after 
the end of the applicable performance period, in order for information 
on the claims to be included in our calculations. As noted above, if we 
determine that it is not operationally feasible to have a claims data 
run-out for the 90-day timeframe, then we will utilize a 60-day 
duration. As an alternative to the above proposal, we also considered 
using claims that are paid within 60 days after 2017, for assessment of 
performance and application of the MIPS payment adjustment for 2019. We 
are seeking comment on both approaches.
    Given the need to collect and process information, we propose at 
Sec.  414.1320 that for 2019 and subsequent years, the performance 
period under MIPS would be the calendar year (January 1 through 
December 31) 2 years prior to the year in which the MIPS adjustment is 
applied. For example, the performance period for the 2019 MIPS 
adjustment would be the full calendar year 2017, that is, January 1, 
2017 through December 31, 2017. We propose to use the 2017 performance 
year for the 2019 payment adjustment consistent with other CMS 
programs. This approach allows for a full year of measurement and 
sufficient time to base adjustments on complete and accurate 
information.
    For individual MIPS eligible clinicians and group practices with 
less than 12 months of performance data to report, such as when a MIPS 
eligible clinician switches practices during the performance period or 
when a MIPS eligible clinician may have stopped practicing for some 
portion of the performance period (for example, a MIPS eligible 
clinician who is on maternity leave or has an illness), we propose that 
the individual MIPS eligible clinician or group would be required to 
report all performance data available from the performance period. 
Specifically, if a MIPS eligible clinician is reporting as an 
individual, they would report all partial year performance data. 
Alternatively, if the MIPS eligible clinician is reporting with a 
group, then the group would report all performance data available from 
the performance period, including partial year performance data 
available for the individual MIPS eligible clinician.
    Under this approach, MIPS eligible clinicians with partial year 
performance data could achieve a positive, neutral, or negative MIPS 
adjustment based on their performance data. We propose this approach in 
order to incentivize accountability for all performance during the 
performance period. Two policies will help minimize the impact of 
partial year data. First, MIPS eligible clinicians with volume below 
the low-volume threshold would be excluded from any payment 
adjustments. Second, MIPS eligible clinicians who report measures, yet 
have insufficient sample size, would not be scored on those measures 
and activities refer to section II.E.6. of this proposed rule for 
further details.
    To potentially refine this proposal in future years, we seek 
comment on methods to identify accurately MIPS eligible clinicians with 
less than 12-month reporting periods, notwithstanding common and 
expected absences due to illness, vacation, or holiday leave. Reliable 
identification of these MIPS eligible clinicians will allow us to 
analyze the characteristics of this MIPS eligible clinicians' patient 
population and better understand how a reduced reporting period impacts 
performance.
    We also seek public comment on an alternative approach for future 
years for assessment of individual MIPS eligible clinicians with less 
than 12 months of performance data in the performance year. For 
example, if we can identify such MIPS eligible clinician's and confirm 
there are data issues that led to invalid performance calculations, 
then we could score the MIPS eligible clinician with a CPS equal to the 
performance threshold, which would result in a zero payment adjustment. 
We note this approach would not assess a MIPS eligible clinicians' 
performance for partial-year performance data. We do

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not believe that consideration of partial year performance is necessary 
for assessment of groups, which should have adequate coverage across 
MIPS eligible clinicians to provide valid performance calculations.
    We also seek comment on reasonable thresholds for considering 
performance to be less than 12 months. For example, we expect that some 
MIPS eligible clinicians will take leave related to illness, vacation, 
and holidays. We would not anticipate applying special policies for 
lack of performance related to these common and expected absences 
assuming MIPS eligible clinicians' quality reporting includes measures 
with sufficient sample size to generate valid and reliable scores. We 
seek comment on how to account for MIPS eligible clinicians with 
extended leave that may affect measure sample size.
    We request comments on these proposals and approaches.
5. MIPS Category Measures and Activities
a. Performance Category Measures and Reporting
(1) Statutory Requirements
    Section 1848(q)(2)(A) of the Act requires the Secretary to use four 
performance categories in determining each MIPS eligible clinician's 
CPS under the MIPS: Quality; resource use; CPIA; and advancing care 
information. Section 1848(q)(2)(B) of the Act, subject to section 
1848(q)(2)(C) of the Act, describes the measures and activities that, 
for purposes of the MIPS performance standards, must be specified under 
each performance category for a performance period.
    Section 1848(q)(2)(B)(i) of the Act describes the measures and 
activities that must be specified under the MIPS quality performance 
category as the quality measures included in the annual final list of 
quality measures published under section 1848(q)(2)(D)(i) of the Act 
and the list of quality measures described in section 1848(q)(2)(D)(vi) 
of the Act used by QCDRs under section 1848(m)(3)(E) of the Act. Under 
section 1848(q)(2)(C)(i) of the Act, the Secretary must, as feasible, 
emphasize the application of outcome-based measures in applying section 
1848(q)(2)(B)(i) of the Act. Under section 1848(q)(2)(C)(iii) of the 
Act, the Secretary may also use global measures, such as global outcome 
measures and population-based measures, for purposes of the quality 
performance category. Section 1848(q)(2)(B)(ii) of the Act describes 
the measures and activities that must be specified under the resource 
use performance category as the measurement of resource use for the 
performance period under section 1848(p)(3) of the Act, using the 
methodology under section 1848(r) of the Act as appropriate, and, as 
feasible and applicable, accounting for the cost of drugs under Part D.
    Section 1848(q)(2)(C)(ii) of the Act allows the Secretary to use 
measures from other CMS payment systems, such as measures for inpatient 
hospitals, for purposes of the quality and resource use performance 
categories, except that the Secretary may not use measures for hospital 
outpatient departments, other than in the case of items and services 
furnished by emergency physicians, radiologists, and anesthesiologists. 
This proposed rule seeks comment on how it might be feasible and when 
it might be appropriate to incorporate measures from other systems into 
MIPS for clinicians that work in facilities such as inpatient 
hospitals. For example, it may be appropriate to use such measures when 
other applicable measures are not available for individual MIPS 
eligible clinicians or when strong payment incentives are tied to 
measure performance, either at the facility level or with employed or 
affiliated MIPS eligible clinicians.
    Section 1848(q)(2)(B)(iii) of the Act describes the measures and 
activities that must be specified under the CPIA performance category 
as CPIAs under subcategories specified by the Secretary for the 
performance period, which must include at least the subcategories 
specified in section 1848(q)(2)(B)(iii)(I) through (VI) of the Act. 
Section 1848(q)(2)(C)(v)(III) of the Act defines a CPIA as an activity 
that relevant eligible clinician organizations and other relevant 
stakeholders identify as improving clinical practice or care delivery 
and that the Secretary determines, when effectively executed, is likely 
to result in improved outcomes. Section 1848(q)(2)(B)(iii) of the Act 
requires the Secretary to give consideration to the circumstances of 
small practices (consisting of 15 or fewer professionals) and practices 
located in rural areas and geographic HPSAs in establishing CPIAs.
    Section 1848(q)(2)(B)(iv) of the Act describes the measures and 
activities that must be specified under the advancing care information 
performance category as the requirements established for the 
performance period under section 1848(o)(2) for determining whether an 
eligible clinician is a meaningful EHR user.
    As discussed in section II.E.1.b. of this proposed rule, section 
1848(q)(2)(C)(iv) of the Act requires the Secretary to give 
consideration to the circumstances of non-patient facing MIPS eligible 
clinicians in specifying measures and activities under the MIPS 
performance categories and allows the Secretary, to the extent feasible 
and appropriate, to take those circumstances into account and apply 
alternative measures or activities that fulfill the goals of the 
applicable performance category. In doing so, the Secretary is required 
to consult with non-patient facing professionals.
    Section 101(b) of MACRA amends certain provisions of section 
1848(k), (m), (o), and (p) of the Act to generally provide that the 
Secretary will carry out such provisions in accordance with section 
1848(q)(1)(F) of the Act for purposes of MIPS. Section 1848(q)(1)(F) of 
the Act provides that, in applying a provision of section 1848(k), (m), 
(o), and (p) of the Act for purposes of MIPS, the Secretary must adjust 
the application of the provision to ensure that it is consistent with 
the MIPS requirements and must not apply the provision to the extent 
that it is duplicative with a MIPS provision.
(2) Submission Mechanisms
    We propose at Sec.  414.1325(a) that individual MIPS eligible 
clinicians and groups would be required to submit data on measures and 
activities for the quality, CPIA and advancing care information 
performance categories. As proposed at Sec.  414.1325(f), we do not 
propose any data submission requirements for the resource use 
performance category and for certain quality measures used to assess 
performance on the quality performance category and for certain 
activities in the CPIA performance category. For the resource use 
performance category, we propose that each individual MIPS eligible 
clinician's and group's resource use performance would be calculated 
using administrative claims data. As a result, individual MIPS eligible 
clinicians and groups would not be required to submit any additional 
information for the resource use performance category. In addition, we 
would be using administrative claims data to calculate performance on a 
subset of the MIPS quality measures and the CPIA performance category. 
For this subset of quality measures and CPIAs, MIPS eligible clinicians 
and groups would not be required to submit additional information. For 
individual clinicians and groups that are not MIPS eligible clinicians, 
such as physical therapists, but elect to report to MIPS, we would 
calculate administrative claims resource use measures and quality 
measures, if data is available. We are proposing multiple data

[[Page 28182]]

submission mechanisms for MIPS as outlined in Tables 1 and 2 to provide 
MIPS eligible clinicians with flexibility to submit their MIPS measures 
and activities in a manner that best accommodates the characteristics 
of their practice. We note that other terms have been used for these 
submission mechanisms in earlier programs and in industry. As a result, 
the terms used for the submission mechanisms may be refined in the 
final rule for clarity.
[GRAPHIC] [TIFF OMITTED] TP09MY16.000

    We propose at Sec.  414.1325(d) that MIPS eligible clinicians and 
groups may elect to submit information via multiple mechanisms; 
however, they must use the same identifier for all performance 
categories and they may only use one submission mechanism per category. 
For example, a MIPS eligible clinician could use one submission 
mechanism for sending quality measures and another for sending CPIA 
data, but a MIPS eligible clinician could not use two submission 
mechanisms for a single category such as submitting three quality 
measures via claims and three quality measures via registry. We believe 
the proposal to allow multiple mechanisms, while restricting the number 
of mechanisms per category, offers flexibility without adding undue 
complexity.

[[Page 28183]]

    For individual MIPS eligible clinicians, we propose at Sec.  
414.1325(b), that an individual MIPS eligible clinician may choose to 
submit their quality, CPIA, and advancing care information data using 
qualified registry, QCDR, or EHR submission mechanisms. Furthermore, we 
propose at Sec.  414.1400 that a qualified registry, health IT vendor, 
or QCDR could submit data on behalf of the MIPS eligible clinician for 
the three performance categories: Quality, CPIA, and advancing care 
information. As described in section II.E.9. of this proposed rule, 
these third party intermediaries would have to be qualified to submit 
for each of the performance categories. Additionally, we propose at 
Sec.  414.1325(b)(4) and (5) that individual MIPS eligible clinicians 
may elect to report quality information via Medicare Part B claims and 
their CPIA and advancing care information performance category data 
through attestation.
    For groups that are not reporting through the APM scoring standard, 
we propose at Sec.  414.1325(c) that these groups may choose to submit 
their MIPS quality, CPIA, and advancing care information data using 
qualified registry, QCDR, EHR, or CMS Web Interface (for groups of 25+ 
MIPS eligible clinicians) submission mechanisms. Furthermore, we 
propose at Sec.  414.1400 that a qualified registry, health IT vendor 
that obtains data from a MIPS eligible clinician's CEHRT, or QCDR could 
submit data on behalf of the group for the three performance 
categories: Quality, CPIA, and advancing care information. 
Additionally, groups may elect to submit their CPIA or advancing care 
information performance category data through attestation.
    For those MIPS eligible clinicians participating in an APM that 
uses the APM scoring standard, we refer readers to section II.E.5.h. of 
this proposed rule, which describes how certain APM Entities submit 
data to MIPS, including separate approaches to the quality and resource 
use performance categories for APMs.
    We propose one exception to the requirement for one reporting 
mechanism per category. Groups consisting of two or more eligible 
clinicians that elect to include CAHPS for MIPS as a quality measure 
must use a CMS-approved survey vendor. Their other quality information 
may be reported by any single one of the other proposed submission 
mechanisms.
    While we allow MIPS eligible clinicians and groups to submit data 
for different performance categories via multiple submission 
mechanisms, we encourage MIPS eligible clinicians to submit MIPS 
information for the CPIA and advancing care information performance 
categories through the same reporting mechanism that is used for 
quality reporting. We believe it would reduce administrative burden and 
would simplify the data submission process for MIPS eligible clinicians 
by having a single reporting mechanism for all three performance 
categories for which MIPS eligible clinicians would be required to 
submit data: Quality, CPIA and advancing care information. However, we 
were concerned that not all third party entities would be able to 
implement the changes necessary to support reporting on all categories 
in the first year. We seek comments for future rulemaking on whether we 
should propose requiring health IT vendors, QCDRs and qualified 
registries to have the capability to submit data for all MIPS 
performance categories.
    As we noted in this section of the proposed rule, we propose that 
MIPS eligible clinicians may report measures and activities using 
different submission methods across the performance categories. As we 
gain experience under MIPS, we anticipate that in future years it may 
be beneficial and reduce burden on MIPS eligible clinicians to require 
data for multiple performance categories to come through a single 
submission mechanism.
    Further, we will be flexible in implementing MIPS. For example, if 
a MIPS eligible clinician submits data via multiple submission 
mechanisms (for example, registry and QCDR), we would score all the 
options and use the highest performance score for the eligible 
clinician or group as described in section II.E.6.a.(1)(b). However, we 
encourage eligible clinicians to report data for a given performance 
category using a single submission mechanism.
    Finally, section 1848(q)(1)(E) of the Act requires the Secretary to 
encourage the use of QCDRs under section 1848(m)(3)(E) of the Act in 
carrying out MIPS. Section 1848(q)(5)(B)(ii)(I) of the Act requires the 
Secretary, under the CPS methodology, to encourage MIPS eligible 
clinicians to report on applicable measures with respect to the quality 
performance category through the use of CEHRT and QCDRs. We note that 
this proposed rule uses the term CEHRT and certified health IT in 
different contexts. For an explanation of these terms and contextual 
use within this proposed rule, we refer readers to section II.E.5.g. of 
this proposed rule.
    We have multiple policies to encourage the usage of QCDRs and 
CEHRT. In part, we are promoting the use of CEHRT by awarding bonus 
points in the quality scoring section for measures gathered and 
reported electronically via the QCDR, qualified registry, Web 
Interface, or CEHRT submission mechanisms (see II.E.6.b). By promoting 
use of CEHRT through various submission mechanisms, we believe MIPS 
eligible clinicians have flexibility in implementing electronic measure 
reporting in a manner which best suits their practice.
    To encourage the use of QCDRs, we have created opportunities for 
QCDRs to report new and innovative quality measures. In addition, 
several CPIAs emphasize QCDR participation. Finally, we allow for QCDRs 
to report data on all MIPS performance categories that require data 
submission and hope this will become a viable option for MIPS eligible 
clinicians. We believe these flexible options will allow MIPS eligible 
clinicians to more easily meet the submission criteria for MIPS, which 
in turn will positively affect their CPS.
    We request comments on these proposals.
(3) Submission Deadlines
    For the submission mechanisms described in section II.E.5.a.(2) of 
this proposed rule, we propose a submission deadline whereby all 
associated data for all performance categories must be submitted. In 
establishing the submission deadlines, we have taken into account 
multiple considerations, including the type of submission mechanism, 
the MIPS performance period, and stakeholder input and our experiences 
under the submission deadlines for the PQRS, VM, and Medicare EHR 
Incentive Programs.
    Historically, under the PQRS, VM or Medicare EHR Incentive 
Programs, the submission of data occurred after the close of the 
performance periods. Our experience has shown that allowing for the 
submission of data after the close of the performance period provides 
either the eligible clinician or the third party intermediary time to 
ensure the data they submit to us is valid, accurate and has undergone 
necessary data quality checks. Stakeholders have also stated that they 
would appreciate the ability to submit data to us on a more frequent 
basis so they can receive feedback more frequently throughout the 
performance period. We also note that, as described in section II.E.4. 
of this proposed rule, the MIPS performance period for payments 
adjusted in 2019 is calendar year 2017 (January 1 through December 31).
    Based on the factors noted, we propose at Sec.  414.1325(e) the 
data submission deadline for the qualified

[[Page 28184]]

registry, QCDR, EHR, and attestation submission mechanisms would be 
March 31 following the close of the performance period. We anticipate 
that the submission period would begin January 2 following the close of 
the performance period. For example, for the first MIPS performance 
period, the data submission period would occur from January 2, 2018, 
through March 31, 2018. We note that this submission period is the same 
time frame as what is currently available to eligible professionals and 
group practices under PQRS. We are interested in receiving feedback on 
whether it is advantageous to either (1) have a shorter time frame 
following the close of the performance period, or (2) have a submission 
period that would occur throughout the performance period, such as bi-
annual or quarterly submissions; and (3) whether January 1 should also 
be included in the submission period. We welcome comments on these 
items.
    We further propose that for the Medicare Part B claims submission 
mechanism, the submission deadline would occur during the performance 
period with claims required to be processed no later than 90 days 
following the close of the performance period. Lastly, for the CMS Web 
Interface submission mechanism, the submission deadline will occur 
during an eight-week period following the close of the performance 
period that will begin no earlier than January 1 and end no later than 
March 31. For example, the CMS Web Interface submission period could 
span an 8 week timeframe beginning January 16 and ending March 13. The 
specific deadline during this timeframe will be published on the CMS 
Web site.
    We request comments on these proposals.
b. Quality Performance Category
(1) Background
(a) General Overview and Strategy
    The MIPS program is one piece of the broader health care 
infrastructure needed to reform the health care system and improve 
health care quality, efficiency, and patient safety for all Americans. 
We seek to balance the sometimes competing considerations of the health 
system and minimize burdens on health care providers given the short 
timeframe available under the MACRA for implementation. Ultimately, 
MIPS should, in concert with other provisions of the Act, support 
health care that is patient-centered, evidence-based, prevention-
oriented, outcome driven, efficient, and equitable.
    Under MIPS, clinicians are incentivized to engage in improvement 
measures and activities that have a proven impact on patient health and 
safety and are relevant to their patient population. We envision a 
future state where MIPS eligible clinicians will be seamlessly using 
their certified health IT to leverage advanced clinical quality 
measurement to manage patient population with the least amount of 
workflow disruption and reporting burden. Ensuring clinicians are held 
accountable for patients' transitions across the continuum of care is 
imperative. For example, when a patient is discharged from an emergency 
department to a primary care physician office, the emergency department 
clinicians should have a shared incentive for a seamless transition. 
Clinicians may also be working with a QCDR to abstract and report 
quality measures to CMS and commercial payers and to track patients 
longitudinally over time for quality improvement.
    Ideally, clinicians in the MIPS program will have accountability 
for quality and resource use measures that are related to one another 
and will be engaged in CPIAs that directly help them improve in both 
specialty-specific clinical practice and more holistic areas (for 
example, patient experience, prevention, population health). Finally, 
MIPS eligible clinicians will be using CEHRT and other tools which 
leverage interoperable standards for data capture, usage, and exchange 
in order to facilitate and enhance patient and family engagement, care 
coordination among diverse care team members, and, in continuous 
learning and rapid-cycle improvement leveraging advanced quality 
measurement and safety initiatives.
    One of our goals in the MIPS program is to use a patient-centered 
approach to program development that will lead to better, smarter, and 
healthier care. Part of that goal includes meaningful measurement which 
we hope to achieve through:
     Measuring performance on measures that are relevant and 
meaningful.
     Maximizing the benefits of CEHRT.
     Flexible scoring that recognizes all of a MIPS eligible 
clinician's efforts above a minimum level of effort and rewards 
performance that goes above and beyond the norm.
     Measures that are built around real clinical workflows and 
data captured in the course of patient care activities.
     Measures and scoring that can discern meaningful 
differences in performance in each performance category and 
collectively between low and high performers.
(b) The MACRA Requirements
    Sections 1848(q)(1)(A)(i) and (ii) of the Act require the Secretary 
to develop a methodology for assessing the total performance of each 
MIPS eligible clinician according to performance standards and, using 
that methodology, to provide for a CPS for each MIPS eligible 
clinician. Section 1848(q)(2)(A)(i) of the Act requires us to use the 
quality performance category in determining each MIPS eligible 
clinician's CPS, and section 1848(q)(2)(B)(i) of the Act describes the 
measures and activities that must be specified under the quality 
performance category.
    The statute does not specify the number of quality measures on 
which a MIPS eligible clinician must report, nor does it specify the 
amount or type of information that a MIPS eligible clinician must 
report on each quality measure. However, section 1848(q)(2)(C)(i) of 
the Act requires the Secretary, as feasible, to emphasize the 
application of outcomes-based measures.
    Sections 1848(q)(1)(E) of the Act requires the Secretary to 
encourage the use of QCDRs, and section 1848(q)(5)(B)(ii)(I) of the Act 
requires the Secretary to encourage the use of CEHRT and QCDRs for 
reporting measures under the quality performance category under the CPS 
methodology, but the statute does not limit the Secretary's discretion 
to establish other reporting mechanisms.
    Section 1848(q)(2)(C)(iv) of the Act generally requires the 
Secretary to give consideration to the circumstances of non-patient-
facing MIPS eligible clinicians and allows the Secretary, to the extent 
feasible and appropriate, to apply alternative measures or activities 
to such clinicians.
(c) Relationship to the PQRS and VM
    Previously, the PQRS, which is a pay-for-reporting program, defined 
standards for satisfactory reporting and satisfactory participation to 
earn payment incentives or to avoid a payment adjustment EPs could 
choose from a number of reporting mechanisms and options. Based on the 
reporting option, the EP had to report on a certain number of measures 
for a certain portion of their patients. In addition, the measures had 
to span a set number of National Quality Strategy (NQS) domains, 
information related to the NQS can be found at http://www.ahrq.gov/workingforquality/about.htm. The VM built its policies off

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the PQRS criteria for avoiding the PQRS payment adjustment. Groups that 
did not meet the criteria as a group to avoid the PQRS payment 
adjustment or groups that did not have at least 50 percent of the EPs 
that did not meet the criteria as individuals to avoid the PQRS payment 
adjustment automatically received the maximum negative adjustment 
established under the VM and are not measured on their quality 
performance.
    MIPS, in contrast to PQRS, is not a pay-for-reporting program, and 
we propose that it would not have a ``satisfactory reporting'' 
requirement. However, in order to develop an appropriate methodology 
for scoring the quality performance category, we believe that MIPS 
needs to define the expected data submission criteria and that the 
measures need to meet a data completeness standard. In this section we 
propose the minimum data submission criteria and data completeness 
standard for the MIPS quality performance category for the submission 
mechanisms that were proposed earlier in section II.E.5.a. The scoring 
methodology described in section II.E.6. of this proposed rule would 
adjust the quality performance category scores based on whether or not 
an individual MIPS eligible clinician or group met these criteria.
    In the MIPS and APMs RFI, we requested feedback on numerous 
provisions related to data submission criteria including: How many 
measures should be required? Should we maintain the policy that 
measures cover a specified number of NQS domains? How do we apply the 
quality performance category to MIPS eligible clinicians that are in 
specialties that may not have enough measures to meet our defined 
criteria? Several themes emerged from the comments. Commenters 
expressed concern that the general PQRS satisfactory reporting 
requirement to report nine measures across three NQS domains is too 
high and forces eligible clinicians to report measures that are not 
relevant to their practices. The commenters requested a more meaningful 
set of requirements that focused on patient care, with some expressing 
the opinion that NQS domain requirements are arbitrary and make 
reporting more difficult. Some commenters asked that we align measures 
across payers and consider using core measure sets. Other commenters 
expressed the need for flexibility and different reporting options for 
different types of practices.
    In response to the comments, and based on our desire to simplify 
the MIPS reporting system and make the measurement more meaningful, we 
are proposing MIPS quality criteria that focus on measures that are 
important to beneficiaries and maintain some of the flexibility from 
PQRS, while addressing several of the issues that concerned commenters.
     To encourage meaningful measurement, we are proposing to 
allow individual MIPS eligible clinicians and groups the flexibility to 
determine the most meaningful measures and reporting mechanisms for 
their practice.
     To simplify the reporting criteria, we are aligning the 
submission criteria for several of the reporting mechanisms.
     To reduce administrative burden and focus on measures that 
matter, we are lowering the expected number of the measures for several 
of the reporting mechanisms, yet are still requiring that certain types 
of measures be reported.
     To create alignment with other payers and reduce burden on 
MIPS eligible clinicians, we are incorporating measures that align with 
other national payers.
     To create a more comprehensive picture of the practice 
performance, we are also proposing to use all-payer data where 
possible.
    As beneficiary health is always our top priority, we propose 
criteria to continue encouraging the reporting of certain measures such 
as outcome, appropriate use, patient safety, efficiency, care 
coordination, or patient experience measures. However, we are proposing 
to remove the requirement for measures to span across multiple domains 
of the NQS. We continue to believe the NQS domains to be extremely 
important and we encourage MIPS eligible clinicians to continue to 
strive to provide care that focuses on: Effective clinical care, 
communication, efficiency and cost reduction, person and caregiver-
centered experience and outcomes, community and population health, and 
patient safety. While we will not require that a certain number of 
measures must span multiple domains, we strongly encourage MIPS 
eligible clinicians to select measures that cross multiple domains. In 
addition, we believe the MIPS program overall, with the focus on 
resource use, CPIAs, and advancing care information performance 
categories will naturally cover many elements in the NQS.
(2) Contribution to Composite Performance Score (CPS)
    For the 2019 MIPS adjustment year, the quality performance category 
will account for 50 percent of the CPS, subject to the Secretary's 
authority to assign different scoring weights under section 
1848(q)(5)(F) of the Act. Section 1848(q)(2)(E)(i)(I)(aa) of the Act 
states the quality performance category will account for 30 percent of 
the CPS for MIPS. However, section 1848(q)(2)(E)(i)(I)(bb) of the Act 
stipulates that for the first and second years for which MIPS applies 
to payments, the percentage of the CPS applicable for the quality 
performance category will be increased so that the total percentage 
points of the increase equals the total number of percentage points by 
which the percentage applied for the resource use performance category 
is less than 30 percent. Section 1848(q)(2)(E)(i)(II)(bb) of the Act 
requires that, for the first year for which MIPS applies to payments, 
not more than 10 percent of the of CPS shall be based on performance to 
the resource use performance category. Furthermore, section 
1848(q)(2)(E)(i)(II)(bb) of the Act states that, for the second year 
for which MIPS applies to payments, not more than 15 percent of the CPS 
shall be based on performance to the resource use performance category. 
We propose at Sec.  414.1330 for payment years 2019 and 2020, 50 
percent and 45 percent, respectively, of the MIPS CPS will be based on 
performance on the quality performance category. For the third and 
future years, 30 percent of the MIPS CPS will be based on performance 
on the quality performance category.
    Section 1848(q)(5)(B)(i) of the Act requires the Secretary to treat 
any MIPS eligible clinician who fails to report on a required measure 
or activity as achieving the lowest potential score applicable to the 
measure or activity. Specifically, under our proposed scoring policies, 
a MIPS eligible clinician or group that reports on all required 
measures and activities could potentially obtain the highest score 
possible within the performance category, presuming they performed well 
on the measures and activities they reported. A MIPS eligible clinician 
or group who does not meet the reporting threshold would receive a zero 
score for the unreported items in the category (in accordance with 
section 1848(q)(5)(B)(i) of the Act). The MIPS eligible clinician or 
group could still obtain a relatively good score by performing very 
well on the remaining items, but a zero score would prevent the MIPS 
eligible clinician or group from obtaining the highest possible score.
(3) Quality Data Submission Criteria
(a) Submission Criteria
    The following are the proposed criteria for the various proposed 
MIPS data submission mechanisms described above in section II.E.5.a. of 
this

[[Page 28186]]

proposed rule for the quality performance category.
(i) Submission Criteria for Quality Measures Excluding CMS Web 
Interface and CAHPS for MIPS
    We propose at Sec.  414.1335 that individual MIPS eligible 
clinicians submitting data via claims and individual MIPS eligible 
clinicians and groups submitting via all mechanisms (excluding CMS Web 
Interface, and for CAHPS for MIPS survey, CMS-approved survey vendors) 
would be required to meet the following submission criteria. We propose 
that for the applicable 12-month performance period, the MIPS eligible 
clinician or group would report at least six measures including one 
cross-cutting measure (if patient-facing) found in Table C and 
including at least one outcome measure. If an applicable outcome 
measure is not available, we propose that the MIPS eligible clinician 
or group would be required to report one other high priority measure 
(appropriate use, patient safety, efficiency, patient experience, and 
care coordination measures) in lieu of an outcome measure. If fewer 
than six measures apply to the individual MIPS eligible clinician or 
group, then we propose the MIPS eligible clinician or group would be 
required to report on each measure that is applicable.
    MIPS eligible clinicians and groups will have to select their 
measures from either the list of all MIPS measures in Table A or a set 
of specialty-specific measure set in Table E. Note that some specialty-
specific measure sets include measures grouped by subspecialty; in 
these cases, the measure set is defined at the subspecialty level.
    We designed the specialty-specific measure sets to address feedback 
we have received in the past that the quality measure selection process 
can be confusing. A common complaint about PQRS was that EPs were asked 
to review close to 300 measures to find applicable measures for their 
specialty. The specialty measure sets in Table E are the same measures 
that are within Table A, however these are sorted consistent with the 
American Board of Medical Specialties (ABMS) specialties. Please note 
that these specialty-specific measure sets are not all inclusive of 
every specialty or subspecialty. We request comments on the measures 
proposed under each of the specialty-specific measure sets. 
Specifically, we seek comments on whether or not the measures proposed 
for inclusion in the specialty-specific measure sets are appropriate 
for the designated specialty or sub-specialty and whether there are 
additional proposed measures that should be included in a particular 
specialty-specific measure set.
    Furthermore, we note that there are some special scenarios for 
those MIPS eligible clinicians who select their measures from a 
specialty-specific measure set at either the specialty or subspecialty 
level (Table E). For example, some of the specialty-specific measure 
sets have less than six measures, in these instances MIPS eligible 
clinicians would report on all of the available measures including an 
outcome measure or, if an outcome measure is unavailable, report 
another high priority measure (appropriate use, patient safety, 
efficiency, patient experience, and care coordination measures), within 
the set and a cross-cutting measure if they are a patient-facing MIPS 
eligible clinician. To illustrate, the subspecialty-level the 
electrophysiology cardiac specialist specialty-specific measure set 
only has three measures within the set, all of which are outcome 
measures. MIPS eligible clinicians and groups reporting on the 
electrophysiology cardiac specialist specialty-specific measure set 
would report on all three measures and since these MIPS eligible 
clinicians are patient-facing they must also report on a cross-cutting 
measure which is defined in Table C. In other scenarios, the specialty-
specific measure sets may have six or more measures, in these instances 
MIPS eligible clinicians would report on at least six measures 
including at least one cross-cutting measure and at least one outcome 
measure or, if an outcome measure is unavailable, report another high 
priority measure (appropriate use, patient safety, efficiency, patient 
experience, and care coordination measure). Specifically, the general 
surgery specialty-specific measure set has eight measures within the 
set, including four outcome measures, three other high priority 
measures and one process measure. MIPS eligible clinicians and groups 
reporting on the general surgery specialty-specific measure set would 
either have the option to report on all measures within the set or 
could select six measures from the set and since these MIPS eligible 
clinicians are patient-facing one of their six measures must be a 
cross-cutting measure which is defined in Table C.
    As noted above, the submission criteria for each specialty-specific 
measure set, or in the measure set defined at the subspecialty level, 
if applicable. Regardless of the number of measures that are contained 
in a specialty-specific measure set, MIPS eligible clinicians reporting 
on a measure set would be required to report at least one cross-cutting 
measure and either at least one outcome measure or, if no outcome 
measures are available in that specialty-specific measure set, report 
another high priority measure. MIPS eligible clinicians or groups that 
report on a specialty-specific measure set that includes more than six 
measures can report on as many measures as they wish as long as they 
meet the minimum requirement to report at least six measures, including 
one cross-cutting measure and one outcome measure, or if an outcome 
measure is not available another high priority measure. We seek comment 
on our proposal to allow reporting of specialty-specific measure sets 
to meet the submission criteria for the quality performance category, 
including whether it is appropriate to allow reporting of a measure set 
at the subspecialty level to meet such criteria, since reporting at the 
subspecialty level would require reporting on fewer measures. 
Alternatively, we seek comment on whether we should only consider 
reporting up to six measures at the higher overall specialty level to 
satisfy the submission criteria. We note that our proposal to allow 
reporting of specialty-specific measure sets at the subspecialty level 
was intended to address the fact that very specialized clinicians who 
may be represented by our subspecialty categories may only have one or 
two applicable measures. Further, we note that we will continue to work 
with specialty societies and other measure developers to increase the 
availability of applicable measures for specialists across the board.
    We propose to define a high priority measure at Sec.  414.1305 as 
an outcome, appropriate use, patient safety, efficiency, patient 
experience, or care coordination quality measures. These measures are 
identified in Table A. We further note that measure types listed as an 
``intermediate outcome'' are considered outcome measures for the 
purposes of scoring; see section II.E.6.
    As an alternative to the above proposals, we also considered 
requiring individual MIPS eligible clinicians submitting via claims and 
individual MIPS eligible clinicians and groups submitting via all 
mechanisms (excluding the CMS Web Interface and, for CAHPS for MIPS 
survey, CMS-approved survey vendors) to meet the following submission 
criteria. For the applicable 12-month performance period, the MIPS 
eligible clinician or group would report at least six measures 
including one cross-cutting measure (if patient-facing) found in Table 
C and one high priority measure (outcome, appropriate use, patient 
safety, efficiency, patient experience, and care

[[Page 28187]]

coordination measures). If fewer than six measures apply to the 
individual MIPS eligible clinician or group, then the MIPS eligible 
clinician or group must report on each measure that is applicable. MIPS 
eligible clinicians and groups will have to select their measures from 
either the list of all MIPS Measures in Table A or a set of specialty-
specific measure set in Table E.
    As discussed in section II.E.1.b. of this proposed rule, MIPS 
eligible clinicians who are non-patient-facing MIPS eligible clinicians 
would not be required to report any cross-cutting measures.
    We intend to develop a validation process to review and validate a 
MIPS eligible clinician's or group's ability to report on at least six 
quality measures, or a specialty-specific measure set, with a 
sufficient sample size, including at least one cross-cutting measure 
(if the MIPS eligible clinician is patient-facing) and either an 
outcome measure if one is available or another high priority measure. 
If a MIPS eligible clinician or group had the ability to report on the 
minimum required measures with sufficient sample size and elects to 
report on fewer than the minimum required measures, then, as described 
in the proposed scoring algorithm in section II.E.6., the missing 
measures would be scored with a zero performance score.
    Our proposal is a decrease from the 2016 PQRS requirement to report 
at least nine measures. In addition, as previously noted, we propose to 
no longer require reporting across multiple NQS domains. We believe 
these proposals are the best approach for the quality performance 
category because it decreases the MIPS eligible clinician's reporting 
burden while focusing on more meaningful types of measures.
    We also note that we believe that outcome measures are more 
valuable than clinical process measures and are instrumental to 
improving the quality of care patients receive. To keep the emphasis on 
such measures in the statute, we plan to increase the requirements for 
reporting outcome measures over the next several years through future 
rulemaking, as more outcome measures become available. For example, we 
may increase the required number of outcome measures to two or three. 
We also believe that appropriate use, patient experience, safety, and 
care coordination measures are more relevant than clinical process 
measures for improving care of patients. Through future rulemaking, we 
plan to increase the requirements for reporting on these types of 
measures over time.
    In consideration of which MIPS measures to identify as reasonably 
focused on appropriate use, we have selected measures which focus on 
minimizing overuse of services, treatments, or the related ancillary 
testing that may promote overuse of services and treatments. We have 
also included select measures of underuse of specific treatments or 
services that either (1) reflected overuse of alternative treatments 
and services that were are not evidence-based or supported by clinical 
guidelines; or (2) where the intent of the measure reflected overuse of 
alternative treatments and services that were not evidence-based or 
supported by clinical guidelines. We realize there are differing 
opinions on what constitutes appropriate use. Therefore, we are seeking 
comments on what specific measures of over or under use should be 
included as appropriate use measures.
    We plan to continue developing care episode groups, patient 
condition groups, and patient relationship categories (and codes for 
such groups and categories). We plan to incorporate new measures as 
they become available and will give the public the opportunity to 
comment on these provisions through future notice and comment 
rulemaking. We also will closely examine the recommendations from HHS' 
Office of the Assistant Secretary for Planning and Evaluation (ASPE) 
study, once they are available, on the issue of risk adjustment for 
socioeconomic status on quality measures and resource use as required 
by section 2(d) of the IMPACT Act and incorporate them as feasible and 
appropriate through future rulemaking. In addition, we are seeking 
comments on ways to minimize potential gaming, for example, requiring 
MIPS eligible clinicians to report only on measures for which they have 
a sufficient sample size, to address concerns that MIPS eligible 
clinicians may solely report on measures that do not have a sufficient 
sample size to decrease the overall weight on their quality score. More 
information on the way we propose to score MIPS eligible clinicians in 
this scenario is in section II.E.6.a.2. We also seek comment on whether 
these proposals sufficiently encourage providers and measure developers 
to move away from clinical process measures and towards outcome 
measures and measures that reflect other NQS domains. We request 
comments on these proposals.
(ii) Submission Criteria for Quality Measures for Groups Reporting via 
the CMS Web Interface
    We propose at Sec.  414.1335 the following criteria for the 
submission of data on quality measures by registered groups of 25 or 
more MIPS eligible clinicians who want to report via the CMS Web 
Interface. For the applicable 12-month performance period, we propose 
that the group would be required to report on all measures included in 
the CMS Web Interface completely, accurately, and timely by populating 
data fields for the first 248 consecutively ranked and assigned 
Medicare beneficiaries in the order in which they appear in the group's 
sample for each module/measure. If the pool of eligible assigned 
beneficiaries is less than 248, then the group would report on 100 
percent of assigned beneficiaries. A group would be required to report 
on at least one measure for which there is Medicare patient data. We do 
not propose any modifications to this reporting process. Groups 
reporting via the CMS Web Interface are required to report on all of 
the measures in the set. Any measures not reported would be considered 
zero performance for that measure in our scoring algorithm.
    Lastly, from our experience with using the CMS Web Interface under 
prior Medicare programs we are aware groups may register for this 
mechanism and have zero Medicare patients assigned and sampled to them. 
We clarify that should a group have no assigned patients, then the 
group, or individual MIPS eligible clinicians within the group, would 
need to select another mechanism to submit data to MIPS. If a group 
does not typically see Medicare patients for which the CMS Web 
Interface measures are applicable, or if the group does not have 
adequate billing history for Medicare patients to be used for 
assignment and sampling of Medicare patients into the CMS Web 
Interface, we advise the group to participate in the MIPS via another 
reporting mechanism.
    As discussed in the CY 2016 PFS final rule with comment period (80 
FR 71144), beginning with the 2017 PQRS payment adjustment, the PQRS 
aligned with the VM's beneficiary attribution methodology for purposes 
of assigning patients for groups that registered to participate in the 
PQRS Group Reporting Option (GPRO) using the CMS Web Interface 
(formerly referred to as the GPRO Web Interface). For certain quality 
and cost measures, the VM uses a two-step attribution process to 
associate beneficiaries with TINs during

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the period in which performance is assessed. This process attributes a 
beneficiary to the TIN that bills the plurality of primary care 
services for that beneficiary (79 FR 67960-67964). We propose to 
continue to align the 2019 CMS Web Interface beneficiary assignment 
methodology with the measures that used to be in the VM: the population 
quality measures discussed below in this proposed rule and total per 
capita cost for all attributed beneficiaries discussed in section 
II.E.5.e. of this proposed rule. As MIPS is a different program, we 
propose to modify the attribution process to update the definition of 
primary care services and to adapt the attribution to different 
identifiers used in MIPS. These changes are discussed in section 
II.E.5.e. of this proposed rule. We request comments on these 
proposals.
(iii) Performance Criteria for Quality Measures for Groups Electing To 
Report Consumer Assessment of Healthcare Providers and Systems (CAHPS) 
for MIPS Survey
    The CAHPS for MIPS survey (formerly known as the CAHPS for PQRS 
survey) consists of the core CAHPS Clinician & Group Survey developed 
by AHRQ, plus additional survey questions to meet CMS's information and 
program needs. For more information on the CAHPS for MIPS survey, 
please see the explanation of the CAHPS for PQRS survey in the CY 2016 
PFS final rule with comment period (80 FR 71142 through 71143). While 
we anticipate that the CAHPS for MIPS survey will closely align with 
the CAHPS for PQRS survey, we may explore the possibility of updating 
the CAHPS for MIPS survey under MIPS, specifically we may not finalize 
all proposed Summary Survey Measures (SSM).
    We propose to allow registered groups of two or more MIPS eligible 
clinicians to voluntarily elect to participate in the CAHPS for MIPS 
survey. Specifically, we propose at Sec.  414.1335 the following 
criteria for the submission of data on the CAHPS for MIPS survey by 
registered groups via CMS-approved survey vendor: For the applicable 
12-month performance period, the group must have the CAHPS for MIPS 
survey reported on its behalf by a CMS-approved survey vendor. In 
addition, the group will need to use another submission mechanism (that 
is, qualified registries, QCDRs, EHR etc.) to complete their quality 
data submission. The CAHPS for MIPS survey would count as one cross-
cutting and/or a patient experience measure, and the group would be 
required to submit at least five other measures through one other data 
submission mechanisms. A group may report any five measures within MIPS 
plus the CAHPS for MIPS survey to achieve the six measures threshold.
    The administration of the CAHPS for MIPS survey would contain a 
six-month look-back period. In previous years the CAHPS for PQRS survey 
was administered from November to February of the reporting year. We 
propose to retain the same survey administration period for the CAHPS 
for MIPS survey. Groups that voluntarily elect to participate in the 
CAHPS for MIPS survey would bear the cost of contracting with a CMS-
approved survey vendor to administer the CAHPS for MIPS survey on the 
group's behalf, just as groups do now for the CAHPS for PQRS survey.
    Under current provisions of PQRS, the CAHPS for PQRS survey is 
required for groups of 100 or more eligible clinicians. Although we are 
not requiring groups to participate in the CAHPS for MIPS survey, we do 
still believe patient experience is important and we are therefore 
proposing a scoring incentive for those groups who report via the CAHPS 
for MIPS survey. As described in section II.E.3.d. of this proposed 
rule, we propose that groups electing to report the CAHPS for MIPS 
survey, would be required to register for the reporting of data. 
Because we believe patients' experiences as they interact with the 
health care system is important, our proposed scoring methodology would 
give bonus points for reporting CAHPS data (or other patient experience 
measures). Please refer to section II.E.6. for further details. We are 
interested in receiving comments on whether the CAHPS for MIPS survey 
should be required for groups of 100 or more MIPS eligible clinicians 
or whether it should be voluntary.
    Currently, the CAHPS for PQRS beneficiary sample is based on 
Medicare claims data. Therefore, only Medicare beneficiaries can be 
selected to participate in the CAHPS for PQRS survey. In future years 
of the MIPS program, we may consider expanding the potential patient 
experience measures to all payers, so that Medicare and non-Medicare 
patients can be included in the CAHPS for MIPS survey sample. We are 
seeking comments on criteria that would ensure comparable samples. We 
seek comments on these proposals.
(b) Data Completeness Criteria
    We want to ensure that data submitted on quality measures are 
complete enough to accurately assess each MIPS eligible clinician's 
quality performance. Section 1848(q)(5)(H) of the Act provides that 
analysis of the quality performance category may include quality 
measure data from other payers, specifically, data submitted by MIPS 
eligible clinicians with respect to items and services furnished to 
individuals who are not individuals entitled to benefits under Part A 
or enrolled under Part B of Medicare.
    To ensure completeness for the broadest group of patients, we 
propose at Sec.  414.1340 the criteria below. MIPS eligible clinicians 
and groups who do not meet the proposed reporting criteria noted below 
would fail the quality component of MIPS.
     Individual MIPS eligible clinicians or groups submitting 
data on quality measures using QCDRs, qualified registries, or via EHR 
need to report on at least 90 percent of the MIPS eligible clinician or 
group's patients that meet the measure's denominator criteria, 
regardless of payer for the performance period. In other words, for 
these submission mechanisms, we would expect to receive quality data 
for both Medicare and non-Medicare patients.
     Individual MIPS eligible clinicians submitting data on 
quality measures data using Medicare Part B claims, would report on at 
least 80 percent of the Medicare Part B patients seen during the 
performance period to which the measure applies.
     Groups submitting quality measures data using the CMS Web 
Interface or a CMS-approved survey vendor to report the CAHPS for MIPS 
survey would need to meet the data submission requirements on the 
sample of the Medicare Part B patients CMS provides.
    We propose to include all-payer data for the QCDR, qualified 
registry, and EHR submission mechanisms because we believe this 
approach provides a more complete picture of each MIPS eligible 
clinicians scope of practice and provides more access to data about 
specialties and subspecialties not currently captured in PQRS. In 
addition, we propose the QCDR, qualified registry, or EHR submission 
must contain a minimum of one quality measure for at least one Medicare 
patient.
    We desire all-payer data for all reporting mechanisms, yet certain 
reporting mechanisms are limited to Medicare Part B data. Specifically, 
the claims reporting mechanism relies on individual MIPS eligible 
clinicians attaching quality information on Medicare Part B claims; 
therefore only Medicare Part B patients can be reported by this 
mechanism. The CMS Web

[[Page 28189]]

Interface and the CAHPS for MIPS survey currently rely on sampling 
protocols based on Medicare Part B billing; therefore, only Medicare 
Part B beneficiaries are sampled through that methodology. We welcome 
comments on ways to modify the methodology to assign and sample 
patients for these mechanisms using data from other payers.
    The data completeness criteria we are proposing are an increase in 
the percentage of patients to be reported by each of the mechanisms 
when compared to PQRS. We believe the proposed thresholds are 
appropriate to ensure a more accurate assessment of a MIPS eligible 
clinician's performance on the quality measures and to avoid any 
selection bias that may exist under the current PQRS requirements. In 
addition, we would like to align all the reporting mechanisms as 
closely as possible with achievable data completeness criteria. We 
intend to continually assess the proposed data completeness criteria 
and will consider increasing these thresholds for future years of the 
program. We request comments on this proposal.
    We are also interested in data that would indicate these data 
completeness criteria are inappropriate. For example, we could envision 
that reporting a cross-cutting measure would not always be appropriate 
for every telehealth service or for certain acute situations. We would 
not want a MIPS eligible clinician to fail reporting the measure in 
appropriate circumstances; therefore, we seek feedback data and 
circumstances where it would be appropriate to lower the data 
completeness criteria.
(c) Summary of Data Submission Criteria Proposals
    Table 3 reflects our proposed Quality Data Submission Criteria for 
MIPS:

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[GRAPHIC] [TIFF OMITTED] TP09MY16.001


[[Page 28191]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.002

(4) Application of Quality Measures to Non-Patient-Facing MIPS Eligible 
Clinicians
    Section 1848(q)(2)(C)(iv) of the Act provides that the Secretary 
must give consideration to the circumstances of non-patient-facing MIPS 
eligible clinicians and may, to the extent feasible and appropriate, 
take those circumstances into account and apply alternative measures or 
activities that fulfill the goals of the applicable performance 
category to such clinicians. In doing so, the Secretary must consult 
with non-patient-facing MIPS eligible clinicians.
    In addition, section 1848(q)(5)(F) to the Act allows the Secretary 
to re-weight MIPS performance categories if there are not sufficient 
measures and activities applicable and available to each type of MIPS 
eligible clinician. We assume many non-patient-facing MIPS eligible 
clinician will not have sufficient measures and activities applicable 
and available to report and will not be scored on the quality 
performance category under MIPS. We refer readers to section II.E.6. of 
this proposed rule to discuss how we address performance categories 
weighting for MIPS eligible clinicians for whom no measures exist in a 
given category.
    In the MIPS and APMs RFI, we solicited feedback on how we should 
apply the four MIPS performance categories to non-patient-facing MIPS 
eligible clinicians and what types of measures and/or CPIAs (new or 
from other payments systems) would be appropriate for these MIPS 
eligible clinicians. We also engaged with seven separate organizations 
representing non-patient-facing MIPS eligible clinicians in the areas 
of anesthesiology, radiology/imaging, pathology, and nuclear medicine, 
specifically cardiology. Organizations we spoke with representing 
several specialty areas indicated that Appropriate Use Criteria (AUC) 
can be incorporated into the CPIA performance category by including 
activities related to appropriate assessments and reducing unnecessary 
tests and procedures. AUC are distinct from clinical guidelines and 
specify when it is appropriate to use a diagnostic test or procedure--
thus reducing unnecessary tests and procedures. Use of AUC is an 
important CPIA as it fosters appropriate utilization and is 
increasingly used to improve quality in cardiovascular medicine, 
radiology, imaging, and pathology. These groups also highlighted that 
many non-patient-facing MIPS eligible clinicians have multiple patient 
safety and practice assessment measures and activities that could be 
included, such as activities that are tied to their participation in 
the Maintenance of Certification (MOC) Part IV for improving the 
clinician's practice. One organization expressed concern that because 
their quality measures are specialized, some members could be 
negatively affected when comparing quality scores because they did not 
have the option to be compared on a broader, more common set of 
measures. The MIPS and APMs RFI commenters noted that the emphasis 
should be on measures and activities that are practical, attainable, 
and meaningful to individual circumstances and that measurement should 
be as outcomes-based to the extent possible. The MIPS and APMs RFI 
commenters emphasized that CPIAs should be selected from a very broad 
array of choices and that ideally non-patient-facing MIPS eligible 
clinicians should help develop those activities so that they provide 
value and are easy to document. For more details regarding the CPIA 
performance category refer to section II.E.5.f. of this proposed rule. 
The comments from these organizations were considered in developing 
these proposals.
    We understand that non-patient-facing MIPS eligible clinicians may 
have a limited number of measures on which to report. Therefore, we 
propose at Sec.  414.1335 that non-patient-facing MIPS eligible 
clinicians would be required to meet the otherwise applicable 
submission criteria, but would not be required to report a cross-
cutting measure.
    Thus we would employ the following strategy for the quality 
performance criteria to accommodate non-patient-facing MIPS eligible 
clinicians:
     Allow non-patient-facing MIPS eligible clinicians to 
report on specialty-specific measure set (which may have fewer than the 
required six measures).

[[Page 28192]]

     Allow non-patient-facing MIPS eligible clinicians to 
report through a QCDR that can report non-MIPS measures.
     Non-patient-facing MIPS eligible clinicians would be 
exempt from reporting a cross-cutting measure as proposed at Sec.  
414.1340.
    We request comments on these proposals.
    (5) Application of Additional System Measures
    Section 1848(q)(2)(C)(ii) of the Act provides that the Secretary 
may use measures used for payment systems other than for physicians, 
such as measures used for inpatient hospitals, for purposes of the 
quality and resource use performance categories. The Secretary may not, 
however, use measures for hospital outpatient departments, except in 
the case of items and services furnished by emergency physicians, 
radiologists, and anesthesiologists.
    In the MIPS and APMs RFI, we sought comment on how we could best 
use this authority. Some facility-based commenters requested a 
submission option that allows the MIPS eligible clinician to be scored 
based on the facility's measures. These commenters noted that the care 
they provide directly relates to and affects the facility's overall 
performance on quality measures and that using this score may be a more 
accurate reflection of the quality of care they provide than the 
quality measures in the PQRS or the VM program.
    We will consider an option for facility-based MIPS eligible 
clinicians to elect to use their institution's performance rates as a 
proxy for the MIPS eligible clinician's quality score. We are not 
proposing an option for year 1 of MIPS because there are several 
operational considerations that must be addressed before this option 
can be implemented. We are requesting comment on the following issues: 
(1) Whether we should attribute a facility's performance to a MIPS 
eligible clinician for purposes of the quality and resource use 
performance categories and under what conditions such attribution would 
be appropriate and representative of the MIPS eligible clinician's 
performance; (2) possible criteria for attributing a facility's 
performance to a MIPS eligible clinician for purposes of the quality 
and resource use performance categories; and (3) the specific measures 
and settings for which we can use the facility's quality and resource 
use data as a proxy for the MIPS eligible clinician's quality and 
resource use performance categories; and (4) if attribution should be 
automatic or if a MIPS eligible clinician or group should elect for it 
to be done and choose the facilities through a registration process. We 
may also consider other options that would allow us to gain experience. 
We seek comments on these approaches.
(6) Global and Population-Based Measures
    Section 1848(q)(2)(C)(iii) of the Act provides that the Secretary 
may use global measures, such as global outcome measures, and 
population-based measures for purposes of the quality performance 
category.
    Under the current PQRS program and Medicare EHR Incentive Program 
quality measures are categorized by domains which include global and 
population-based measures. We identified population and community 
health measures as one of the quality domains related to the CMS 
Quality Strategy and the NQS priorities for health care quality 
improvement discussed in section II.E.5.c. of this proposed rule. 
Population-based measures are also used in the Medicare Shared Savings 
Program and for groups in the VM. For example, in 2015, clinicians were 
held accountable for a component of the Agency for Health Care Research 
(AHRQ) population-based, Ambulatory Care Sensitive Condition measures 
as part of a larger set of Prevention Quality Indicators (PQIs). Two 
broader composite measures of acute and chronic conditions are 
calculated using the respective individual measure rates for VM 
calculations. These PQIs assess the quality of the health care system 
as a whole, and especially the quality of ambulatory care, in 
preventing medical complications that lead to hospital admissions.
    In the CY 2015 PFS final rule with comment period (79 FR 67909), 
Medicare Payment Advisory Commission (MedPAC) commented that we should 
move quality measurement for ACOs, Medicare Advantage (MA) plans, and 
FFS Medicare in the direction of a small set of population-based 
outcome measures, such as potentially preventable inpatient hospital 
admissions, emergency department visits, and readmissions. In the June 
2014 MedPAC Report to the Congress: Medicare and the Health Care 
Delivery System MedPAC suggests considering an alternative quality 
measurement approach that would use population-based outcome measures 
to publicly report on quality of care across Medicare's three payment 
models, FFS, Medicare Advantage, and ACOs.
    In creating policy for global and population-based measures for 
MIPS we considered a more broad-based approach to the use of ``global'' 
and ``population-based'' measures in the MIPS quality performance 
category. After considering the above we propose to use the acute and 
chronic composite measures of Agency for Healthcare Research and 
Quality (AHRQ) Prevention Quality Indicators (PQIs) that meet a minimum 
sample size in the calculation of the quality measure domain for the 
MIPS total performance score; see Table B. Eligible clinicians will be 
evaluated on their performance on these measures in addition to the six 
required quality measures discussed previously and summarized in Table 
A. Based on experience in the VM program, these measures have been 
determined to be reliable with a minimum case size of 20. Average 
reliabilities for the acute and chronic measures range from 0.64 to 
0.79 for groups and individual MIPS eligible clinicians. We intend to 
incorporate a clinical risk adjustment as soon as feasible to the PQI 
composites and continue to research ways to develop and use other 
population-based measures for the MIPS program that could be applied to 
greater numbers of MIPS eligible clinicians going forward. In addition 
to the acute and chronic composite measure, we also propose to include 
the all-cause hospital readmissions measure from the VM as we believe 
this measure also encourages care coordination. In the CY 2016 Medicare 
PFS final rule (80 FR 71296), we did a reliability analysis that 
indicates this measure is not reliable for solo clinicians or practices 
with fewer than 10 clinicians; therefore, we propose to limit this 
measure to groups with 10 or more clinicians and to maintain the 
current VM requirement of 200 cases. Eligible clinicians in groups with 
10 or more clinicians with sufficient cases will be evaluated on their 
performance on this measure in addition to the six required quality 
measures discussed previously and summarized in Table A.
    Furthermore, the proposed claims-based population measures would 
rely on the same two-step attribution methodology that is currently 
used in the VM (79 FR 67961 through 67694). The attribution focuses on 
the delivery of primary care services (77 FR 69320) by both primary 
care physicians and specialists. This attribution logic aligns with the 
total per capita measure and is similar to, but not exactly the same, 
as the assignment methodology used for the Shared Savings Program. For 
example, the Shared Savings Program definition of primary care services 
can

[[Page 28193]]

be found at Sec.  425.20 and excludes claims for certain Skilled 
Nursing Facility (SNF) services that include the POS 31 modifier). In 
section II.E.5.e.3.a.i. of this proposed rule, we propose to exclude 
the POS 31 modifier from the definition of primary care services. As 
described in section II.E.2. of this proposed rule, the attribution 
would be modified slightly to account for the MIPS eligible clinician 
identifiers. We are seeking comments on additional measures or measure 
topics for future years of MIPS and attribution methodology. We request 
comments on these proposals.
c. Selection of Quality Measures for Individual MIPS Eligible 
Clinicians and Groups
(1) Annual List of Quality Measures Available for MIPS Assessment
    Under section 1848(q)(2)(D)(i) of the Act, the Secretary, through 
notice and comment rulemaking, must establish an annual list of quality 
measures from which MIPS eligible clinicians may choose for purposes of 
assessment for a performance period. The annual list of quality 
measures must be published in the Federal Register no later than 
November 1 of the year prior to the first day of a performance period. 
Updates to the annual list of quality measures must be published in the 
Federal Register not later than November 1 of the year prior to the 
first day of each subsequent performance period. Updates may include 
the removal of quality measures, the addition of new quality measures, 
and the inclusion of existing quality measures that the Secretary 
determines have undergone substantive changes. For example, a quality 
measure may be considered for removal if the Secretary determines that 
the measure is no longer meaningful, such as measures that are topped 
out. A measure may be considered topped out if measure performance is 
so high and unvarying that meaningful distinctions and improvement in 
performance can no longer be made. Additionally, we are not the measure 
steward for most of the proposed quality measures available for 
inclusion in the MIPS annual list of quality measures. We rely on 
outside measure stewards and developers to maintain these measures. 
Therefore, we also propose to give consideration in removing measures 
that measure stewards are no longer able to maintain.
    Under section 1848(q)(2)(D)(ii) of the Act, the Secretary must 
solicit a ``Call for Quality Measures'' each year. Specifically, the 
Secretary must request that eligible clinician organizations and other 
relevant stakeholders identify and submit quality measures to be 
considered for selection in the annual list of quality measures, as 
well as updates to the measures. Although we will accept quality 
measures submissions at any time, only measures submitted before June 1 
of each year will be considered for inclusion in the annual list of 
quality measures for the performance period beginning 2 years after the 
measure is submitted. For example, a measure submitted prior to June 1, 
2016 would be considered for the 2018 performance period. Of those 
quality measures submitted before June 1, we will determine which 
quality measures will move forward as potential measures for use in 
MIPS. Prior to finalizing new measures for inclusion in the MIPS 
program, those measures that we determine will move forward must also 
go through notice-and-comment rulemaking and the new proposed measures 
must be submitted to a peer review journal. Finally, for quality 
measures that have undergone substantive changes, we propose to 
identify measures including but not limited to measures that have had 
measure specification, measure title, and domain changes. Through NQF's 
or the measure steward's measure maintenance process, NQF-endorsed 
measures are sometimes updated to incorporate changes that we believe 
do not substantively change the intent of the measure. Examples of such 
changes may include updated diagnosis or procedure codes or changes to 
exclusions to the patient population or definitions. While we address 
such changes on a case-by-case basis, we generally believe these types 
of maintenance changes are distinct from substantive changes to 
measures that result in what are considered new or different measures.
    In the first year of MIPS, we propose to maintain a majority of 
previously implemented measures in PQRS (80 FR 70885-71386) for 
inclusion in the annual list of quality measures. These measures can be 
found in the appendix at Table A: Proposed Individual Quality Measures 
Available for MIPS Reporting in 2017. Also included in the appendix in 
Table B is a list of quality measures that do not require data 
submission, some of which were previously implemented in the VM (80 FR 
71273-71300), that we propose to include in the annual list of MIPS 
quality measures. These measures can be calculated from administrative 
claims data and do not require data submission. We are also proposing 
measures that were not previously finalized for implementation in the 
PQRS program. These measures and their draft specifications are listed 
in Table D. The proposed specialty-specific measure sets are listed in 
Table E. As we continue to develop measures and specialty-specific 
measure sets, we recognize that there are many MIPS eligible clinicians 
who see both Medicaid and Medicare patients and seek to align our 
measures to utilize Medicaid measures in the MIPS quality performance 
category. We believe that aligning Medicaid and Medicare measures is in 
the interest of all providers and will help drive quality improvement 
for our beneficiaries. For future years, we seek comment about the 
addition of a ``Medicaid measure set'' based on the CMCS Adult Core Set 
(https://www.medicaid.gov/medicaid-chip-program-information/by-topics/quality-of-care/adult-health-care-quality-measures.html). Measures we 
are proposing for removal can be found in Table F and measures that 
will have substantive changes for the 2017 performance period can be 
found in Table G. In future years, the annual list of quality measures 
available for MIPS assessment will occur through rulemaking. We request 
comment on these proposals. In particular, we seek comment on whether 
there are any measures that commenters believe should be classified in 
a different NQS domain than what was proposed or that should be 
classified as a different measure type (e.g., process vs. outcome) than 
what was proposed.
(2) Call for Quality Measures
    Each year, we have historically solicited a ``Call for Quality 
Measures'' from the public for possible quality measures for 
consideration for the PQRS. Under MIPS, we propose to continue the 
annual ``Call for Quality Measures'' as a way to engage eligible 
clinician organizations and other relevant stakeholders in the 
identification and submission of quality measures for consideration. 
Under section 1848(q)(2)(D)(ii) of the Act, eligible clinician 
organizations are professional organizations as defined by nationally 
recognized specialty boards of certification or equivalent 
certification boards. However, we do not believe there needs to be any 
special restrictions on the type or make-up of the organizations 
carrying out the process of development of quality measures. Any such 
restriction would limit the development of quality measures and the 
scope and utility of the quality measures that may be considered for 
endorsement. Submission of potential quality measures regardless of 
whether they

[[Page 28194]]

were previously published in a proposed rule or endorsed by an entity 
with a contract under section 1890(a) of the Act, which is currently 
the National Quality Forum, is encouraged.
    As previously noted, we encourage the submission of potential 
quality measures regardless of whether such measures were previously 
published in a proposed rule or endorsed by an entity with a contract 
under section 1890(a) of the Act. However, consistent with the 
expectations established under PQRS, we propose to request that 
stakeholders apply the following considerations when submitting quality 
measures for possible inclusion in MIPS:
     Measures that are not duplicative of an existing or 
proposed measure.
     Measures that are beyond the measure concept phase of 
development and have started testing, at a minimum.
     Measures that include a data submission method beyond 
claims-based data submission.
     Measures that are outcome-based rather than clinical 
process measures.
     Measures that address patient safety and adverse events.
     Measures that identify appropriate use of diagnosis and 
therapeutics.
     Measures that address the domain for care coordination.
     Measures that address the domain for patient and caregiver 
experience.
     Measures that address efficiency, cost and resource use.
     Measures that address a performance gap or measurement 
gap.
    We request comment on these proposals.
(3) Requirements
    Section 1848(q)(2)(D)(iii) of the Act provides that, in selecting 
quality measures for inclusion in the annual final list of quality 
measures, the Secretary must provide that, to the extent practicable, 
all quality domains (as defined in section 1848(s)(1)(B) of the Act) 
are addressed by such measures and must ensure that the measures are 
selected consistent with the process for selection of measures under 
section 1848(k), (m), and (p)(2) of the Act.
    Section 1848(s)(1)(B) of the Act defines ``quality domains'' as at 
least the following domains: clinical care, safety, care coordination, 
patient and caregiver experience, and population health and prevention. 
We believe the five domains applicable to the quality measures under 
MIPS are included in the NQS's six priorities as follows:
     Patient Safety. These are measures that reflect the safe 
delivery of clinical services in all health care settings. These 
measures may address a structure or process that is designed to reduce 
risk in the delivery of health care or measure the occurrence of an 
untoward outcome such as adverse events and complications of procedures 
or other interventions. We believe this NQS priority corresponds to the 
domain of safety.
     Person and Caregiver-Centered Experience and Outcomes. 
These are measures that reflect the potential to improve patient-
centered care and the quality of care delivered to patients. They 
emphasize the importance of collecting patient-reported data and the 
ability to impact care at the individual patient level, as well as the 
population level. These are measures of organizational structures or 
processes that foster both the inclusion of persons and family members 
as active members of the health care team and collaborative 
partnerships with health care providers and provider organizations or 
can be measures of patient-reported experiences and outcomes that 
reflect greater involvement of patients and families in decision 
making, self-care, activation, and understanding of their health 
condition and its effective management. We believe this NQS priority 
corresponds to the domain of patient and caregiver experience.
     Communication and Care Coordination. These are measures 
that demonstrate appropriate and timely sharing of information and 
coordination of clinical and preventive services among health 
professionals in the care team and with patients, caregivers, and 
families to improve appropriate and timely patient and care team 
communication. They may also be measures that reflect outcomes of 
successful coordination of care. We believe this NQS priority 
corresponds to the domain of care coordination.
     Effective Clinical Care. These are measures that reflect 
clinical care processes closely linked to outcomes based on evidence 
and practice guidelines or measures of patient-centered outcomes of 
disease states. We believe this NQS priority corresponds to the domain 
of clinical care.
     Community/Population Health. These are measures that 
reflect the use of clinical and preventive services and achieve 
improvements in the health of the population served. They may be 
measures of processes focused on primary prevention of disease or 
general screening for early detection of disease unrelated to a current 
or prior condition. We believe this NQS priority corresponds to the 
domain of population health and prevention.
     Efficiency and Cost Reduction. These are measures that 
reflect efforts to lower costs and to significantly improve outcomes 
and reduce errors. These are measures of cost, resource use and 
appropriate use of health care resources or inefficiencies in health 
care delivery.
    Section 1848(q)(2)(D)(viii) of the Act provides that the pre-
rulemaking process under section 1890A of the Act is not required to 
apply to the selection of MIPS quality measures. Although not required 
to go through the pre-rulemaking process, we have found the NQF 
convened Measure Application Partnership's (MAP) input valuable. We 
propose that we may consider the MAP's recommendations as part of the 
comprehensive assessment of each measure considered for inclusion under 
MIPS. Elements we propose to consider in addition to those listed in 
the ``Call for Quality Measures'' section of this rule include a 
measure's fit within MIPS, if a measure fills clinical gaps, changes or 
updates to performance guidelines, and other program needs. Further, we 
will continue to explore how global and population-based measures can 
be expanded and plan to add additional population-based measures 
through future rulemaking. We request comment on these proposals.
(4) Peer Review
    Section 1848(q)(2)(D)(iv) of the Act, requires the Secretary to 
submit new measures for publication in applicable specialty-
appropriate, peer-reviewed journals before including such measures in 
the final annual list of quality measures. The submission must include 
the method for developing and selecting such measures, including 
clinical and other data supporting such measures. We believe this 
opportunity for peer review helps ensure that new measures published in 
the final rule are meaningful and comprehensive. We propose to use the 
Call for Quality Measures process as an opportunity to gather the 
information necessary to draft the journal articles for submission from 
measure developers, measure owners and measure stewards since CMS does 
not always develop measures for the quality programs. Information from 
measure developers, measure owners and measure stewards will include 
but is not limited to: Background, clinical evidence and data that 
supports the intent of the measure; recommendation for the measure that 
may come from a study or the United States Preventive Task Force 
(USPTF) recommendations; and how this measure would align with the CMS 
Quality Strategy. The Call for Quality Measures is a yearlong process; 
however, to be aligned with the regulatory process, establishing the 
proposed measure set for the year

[[Page 28195]]

generally begins in April and concludes in July. We will submit new 
measures for publication in applicable specialty-appropriate, peer-
reviewed journals before including such measures in the final annual 
list of quality measures. We request comment on this proposal. 
Additionally, we seek comment on mechanisms that could be used, such as 
the CMS Web site, to notify the public that the requirement to submit 
new measures for publication in applicable specialty-appropriate, peer-
reviewed journals is met. Additionally, we seek comment on the type of 
information that should be included in such notification.
(5) Measures for Inclusion
    Under section 1848(q)(2)(D)(v) of the Act, the final annual list of 
quality measures must include, as applicable, measures from under 
section 1848(k), (m), and (p)(2) of the Act, including quality measures 
among: (1) Measures endorsed by a consensus-based entity; (2) measures 
developed under section 1848(s) of the Act; and (3) measures submitted 
in response to the ``Call for Quality Measures'' required under section 
1848(q)(2)(D)(ii) of the Act. Any measure selected for inclusion that 
is not endorsed by a consensus-based entity must have an evidence-based 
focus. Further, under section 1848(q)(2)(D)(ix), the process under 
section 1890A of the Act is considered optional.
    Section 1848(s)(1) of the Act, as added by section 102 of the 
MACRA, also requires the Secretary of Health and Human Services to 
develop a draft plan for the development of quality measures by January 
1, 2016. We solicited comments from the public on the ``Draft CMS 
Measure Development Plan'' through March 1, 2016. The final CMS Measure 
Development Plan must be finalized and posted on the CMS Web site by 
May 1, 2016.
(6) Exception for QCDR Measures
    Section 1848(q)(2)(D)(vi) of the Act provides that quality measures 
used by a QCDR under section 1848(m)(3)(E) of the Act are not required 
to be established through notice-and-comment rulemaking or published in 
the Federal Register; be submitted for publication in applicable 
specialty-appropriate, peer-reviewed journals, or meet the criteria 
described in section 1848(q)(2)(D)(v) of the Act. The Secretary must 
publish the list of quality measures used by such QCDRs on the CMS Web 
site. We propose to post the quality measures for use by qualified 
clinical data registries in the spring of 2017 for the initial 
performance period and no later than January 1 for future performance 
periods.
    Quality measures that are owned or developed by the QCDR entity and 
proposed by the QCDR for inclusion in MIPS but are not a part of the 
MIPS quality measure set are considered non-MIPS measures. If a QCDR 
wants to use a non-MIPS measure for inclusion in the MIPS program for 
reporting, we propose that these measures go through a rigorous CMS 
approval process during the QCDR self-nomination period. Specific 
details on third party entity requirements can be found in section 
II.E.9 of this proposed rule. The measure specifications will be 
reviewed and each measure will be analyzed for its scientific rigor, 
technical feasibility, duplication to current MIPS measures, clinical 
performance gaps, as evidenced by background and/or literature review, 
and relevance to specialty practice quality improvement. Once the 
measures are analyzed, the QCDR will be notified of which measures are 
approved for implementation. Each non-MIPS measure will be assigned a 
unique ID that can only be used by the QCDR that proposed it. Although 
non-MIPS measures are not required to be NQF-endorsed, we encourage the 
use of NQF-endorsed measures and measures that have been in use prior 
to implementation in MIPS. Lastly, we note that MIPS eligible 
clinicians reporting via QCDR have the option of reporting MIPS 
measures included in Table A in the Appendix to the extent that such 
measures are appropriate for the specific QCDR and have been approved 
by CMS. We request comment on these proposals.
(7) Exception for Existing Quality Measures
    Section 1848(q)(2)(D)(vii)(II) of the Act provides that any quality 
measure specified by the Secretary under section 1848(k) or (m) of the 
Act and any measure of quality of care established under section 
1848(p)(2) of the Act for a performance or reporting period beginning 
before the first MIPS performance period (herein referred to 
collectively as ``existing quality measures'') must be included in the 
annual list of MIPS quality measures unless removed by the Secretary. 
As discussed in section II.E.4 of this proposed rule, we are proposing 
that the performance period for the 2019 MIPS adjustment would be CY 
2017, that is, January 1, 2017 through December 31, 2017. Therefore 
existing quality measures would consist of those that have been 
specified or established by the Secretary as part of the PQRS measure 
set or VM measure set for a performance or reporting period beginning 
before CY 2017.
    Section 1848(q)(2)(D)(vii)(I) of the Act provides that existing 
quality measures are not required to be established through notice-and-
comment rulemaking or published in the Federal Register (although they 
remain subject to the applicable requirements for removing measures and 
including measures that have undergone substantive changes), nor are 
existing quality measures required to be submitted for publication in 
applicable specialty-appropriate, peer-reviewed journals.
(8) Consultation With Relevant Eligible Clinician Organizations and 
Other Relevant Stakeholders
    Section 1890A of the Act, as added by section 3014(b) of the ACA, 
requires that the Secretary establish a pre-rulemaking process under 
which certain steps occur for the selection of certain categories of 
quality and efficiency measures, one of which is that the entity with a 
contract with the Secretary under section 1890(a) of the Act (that is, 
the NQF) convenes multi-stakeholder groups to provide input to the 
Secretary on the selection of such measures. These categories are 
described in section 1890(b)(7)(B) of the Act and include the quality 
measures selected for the PQRS. In accordance with section 1890A(a)(1) 
of the Act, the NQF convened multi-stakeholder groups by creating the 
MAP. Section 1890A(a)(2) of the Act requires that the Secretary make 
publicly available by December 1 of each year a list of the quality and 
efficiency measures that the Secretary is considering under Medicare. 
The NQF must provide the Secretary with the MAP's input on the 
selection of measures by February 1 of each year. The lists of measures 
under consideration for selection are available at http://www.qualityforum.org/map/.
    Section 1848(q)(2)(D)(viii) of the Act provides that relevant 
eligible clinician organizations and other relevant stakeholders, 
including state and national medical societies, must be consulted in 
carrying out the annual list of quality measures available for MIPS 
assessment. Section 1848(q)(2)(D)(ii)(II) of the Act defines an 
eligible clinician organization as a professional organization as 
defined by nationally recognized specialty boards of certification or 
equivalent certification boards. Section 1848(q)(2)(D)(viii) of the Act 
further provides that the pre-rulemaking process under section 1890A of 
the Act is not required to apply to the selection of MIPS quality 
measures.

[[Page 28196]]

    Although MIPS quality measures are not required to go through the 
pre-rulemaking process under section 1890A of the Act, we have found 
the MAP's input valuable. The MAP process enables us to consult with 
relevant eligible professional organizations and other stakeholders, 
including state and national medical societies in finalizing the annual 
list of quality measures. In addition to the MAP's input this year, we 
also received input from the Core Measure Collaborative, specifically 
the America's Health Insurance Plans (AHIP), on core quality measure 
sets. The Core Measure Collaborative was organized by CMS in 
coordination with AHIP in 2014. This stakeholder workgroup has 
developed several condition-specific core measure sets to help align 
reporting requirements for private and public health insurance 
providers. Sixteen of the newly proposed measures under MIPS were 
recommended by the Core Measure Collaborative.
(9) Cross-Cutting Measures for 2017 and Beyond
    Under PQRS we realized the value in requiring EPs to report a 
cross-cutting measure and have proposed to continue the use of cross-
cutting measures under MIPS. The cross-cutting measures help focus our 
efforts on population health improvement and they also allow for 
meaningful comparisons between MIPS eligible clinicians. Under MIPS, we 
are proposing fewer cross-cutting measures than those available under 
PQRS for 2016 reporting; however, we believe the list contains measures 
for which all patient-facing MIPS eligible clinicians should be able to 
report, as the measures proposed include commonplace health improvement 
activities such as checking blood pressure and medication management. 
We have eliminated some measures for which the reporting MIPS eligible 
clinician may not actually be providing the care, but are just 
reporting another MIPS eligible clinician's performance result. An 
example of this would be a MIPS eligible clinician who never manages a 
diabetic patient's glucose, yet previously could have reported a 
measure about hemoglobin A1c based on an encounter. This type of 
reporting will likely not help improve or confirm the quality of care 
the MIPS eligible clinician provides to his or her patients. Although 
there are fewer proposed cross-cutting measures under MIPS, in previous 
years some measures were too specialized and could not be reported on 
by all MIPS eligible clinicians. The proposed cross-cutting measures 
under MIPS are more broadly applicable and can be reported on by most 
specialties. The proposed MIPS cross-cutting measure set will be 
available on the CMS Web site. Non-patient-facing MIPS eligible 
clinicians do not have a cross-cutting measure requirement. The cross-
cutting measures that were available under PQRS for 2016 reporting that 
are not being proposed as cross-cutting measures for 2017 reporting 
are:
     PQRS #001 (Diabetes: Hemoglobin A1c Poor Control).
     PQRS #046 (Medication Reconciliation Post Discharge).
     PQRS #110 (Preventive Care and Screening: Influenza 
Immunization).
     PQRS #111 (Pneumonia Vaccination Status for Older Adults).
     PQRS #112 (Breast Cancer Screening).
     PQRS #131 (Pain Assessment and Follow-Up).
     PQRS #134 (Preventive Care and Screening: Screening for 
Clinical Depression and Follow-Up Plan).
     PQRS #154 (Falls: Risk Assessment).
     PQRS #155 (Falls: Plan of Care).
     PQRS #182 (Functional Outcome Assessment).
     PQRS #240 (Childhood Immunization Status).
     PQRS #318 (Falls: Screening for Fall Risk).
     PQRS #400 (One-Time Screening for Hepatitis C Virus (HCV) 
for Patients at Risk).
    While we are proposing to remove the above listed measures from the 
cross-cutting measure set, these measures are being proposed to be 
available as individual quality measures available for MIPS reporting, 
some of which have proposed substantive changes. The proposed MIPS 
cross-cutting measure set can be found in Table C of the appendix of 
this proposed rule and will be available on the CMS Web site.
e. Resource Use Performance Category
(1) Background
(a) General Overview and Strategy
    Measuring resource use is an integral part of measuring value. We 
envision the measures in the MIPS resource use performance category 
would provide MIPS eligible clinicians with the information they need 
to provide appropriate care to their patients and enhance health 
outcomes. In implementing the resource use performance category, we 
propose to start with existing condition and episode-based measures, 
and the total per capita costs for all attributed beneficiaries measure 
(total per capita cost measure). All resource use measures would be 
adjusted for geographic payment rate adjustments and beneficiary risk 
factors. In addition, a specialty adjustment would be applied to the 
total per capita cost measure. As detailed in section II.E.6.a.3 of 
this proposed rule, all of the measures attributed to a MIPS eligible 
clinician or group would be weighted equally within the resource use 
performance category, and there would be no minimum number of measures 
required to receive a score under the resource use performance 
category. We plan to draw on standards for measure reliability, patient 
attribution, risk adjustment, and payment standardization from the 
Physician Value-based Payment Modifier (Value Modifier or VM) as well 
as the Physician Feedback Program, as we believe many of the same 
measurement principles for cost measurement in the VM are applicable 
for measurement in the resource use performance category in MIPS.
    All measures used under the resource use performance category would 
be derived from Medicare administrative claims data and as a result, 
participation would not require use of a data submission mechanism.
    We plan to continue developing care episode groups, patient 
condition groups, and patient relationship categories (and codes for 
such groups and categories). We plan to incorporate new measures as 
they become available and will give the public the opportunity to 
comment on these provisions through future notice and comment 
rulemaking. We also will closely examine the recommendations from the 
HHS' Office of the Assistant Secretary for Planning and Evaluation 
(ASPE) study, when they are available, on the issue of risk adjustment 
for socioeconomic status on quality measures and resource use as 
required by section 2(d) of the IMPACT Act and incorporate them as 
feasible and appropriate through future rulemaking, under section 
1848(q)(1)(G) of the Act.
(b) MACRA Requirements
    Section 1848(q)(2)(A)(ii) of the Act establishes ``resource use'' 
as a performance category under the MIPS. Section 1848(q)(2)(B)(ii) of 
the Act describes the measures of the resource use performance category 
as the measurement of resource use for a MIPS performance period under 
section1848(p)(3) of the Act, using the methodology under section 
1848(r) of the Act as appropriate, and, as feasible and applicable, 
accounting for the cost of drugs under Part D.
    As discussed in section II.E.5.e.(1)(c) of this proposed rule, we 
previously established in rulemaking a value-based

[[Page 28197]]

payment modifier, as required by section 1848(p) of the Act, that 
provides for differential payment to a physician or a group of 
physicians under the Physician Fee Schedule based on the quality of 
care furnished compared to cost. For the evaluation of costs of care, 
section 1848(p)(3) refers to appropriate measures of costs established 
by the Secretary that eliminate the effect of geographic adjustments in 
payment rates and take into account risk factors (such as socioeconomic 
and demographic characteristics, ethnicity, and health status of 
individuals, such as to recognize that less healthy individuals may 
require more intensive interventions) and other factors determined 
appropriate by the Secretary.
    Section 1848(r) of the Act specifies a series of steps and 
activities for the Secretary to undertake to involve the physician, 
practitioner, and other stakeholder communities in enhancing the 
infrastructure for resource use measurement, including for purposes of 
MIPS and APMs. Section 1848(r)(2) of the Act requires the development 
of care episode and patient condition groups, and classification codes 
for such groups. That section provides for care episode and patient 
condition groups to account for a target of an estimated one-half of 
expenditures under Parts A and B (with this target increasing over time 
as appropriate). We are required to take into account several factors 
when establishing these groups. For care episode groups, we must 
consider the patient's clinical problems at the time items and services 
are furnished during an episode of care, such as clinical conditions or 
diagnoses, whether or not inpatient hospitalization occurs, the 
principal procedures or services furnished, and other factors 
determined appropriate by the Secretary. For patient condition groups, 
we must consider the patient's clinical history at the time of a 
medical visit, such as the patient's combination of chronic conditions, 
current health status, and recent significant history (such as 
hospitalization and major surgery during a previous period), and other 
factors determined appropriate. We are required to post on the CMS Web 
site a draft list of care episode and patient condition groups and 
codes for solicitation of input from stakeholders, and subsequently 
post on the Web site an operational list of such groups and codes. As 
required by section 1848(r)(2)(H) of the Act, not later than November 1 
of each year (beginning with 2018), the Secretary shall, through 
rulemaking, revise the operational list as the Secretary determines may 
be appropriate.
    To facilitate the attribution of patients and episodes to one or 
more clinicians, section 1848(r)(3) of the Act requires the development 
of patient relationship categories and codes that define and 
distinguish the relationship and responsibility of a physician or 
applicable practitioner with a patient at the time of furnishing an 
item or service. These categories shall include different relationships 
of the clinician to the patient and reflect various types of 
responsibility for and frequency of furnishing care. We are required to 
post on the CMS Web site a draft list of patient relationship 
categories and codes for solicitation of input from stakeholders, and 
subsequently post on the Web site an operational list of such 
categories and codes. As required by section 1848(r)(3)(F) of the Act, 
not later than November 1 of each year (beginning with 2018), the 
Secretary shall, through rulemaking, revise the operational list as the 
Secretary determines may be appropriate.
    Section 1848(r)(4) of the Act requires that claims submitted for 
items and services furnished by a physician or applicable practitioner 
on or after January 1, 2018, shall, as determined appropriate by the 
Secretary, include the applicable codes established for care episode 
groups, patient condition groups, and patient relationship categories 
under sections 1848(r)(2) and (3) of the Act, as well as the NPI of the 
ordering physician or applicable practitioner (if different from the 
billing physician or applicable practitioner).
    Under section 1848(r)(5) of the Act, to evaluate the resources used 
to treat patients, the Secretary shall, as determined appropriate, use 
the codes reported on claims under section 1848(r)(4) of the Act to 
attribute patients to one or more physicians and applicable 
practitioners and as a basis to compare similar patients, and conduct 
an analysis of resource use. In measuring such resource use, the 
Secretary shall use per patient total allowed charges for all services 
under Parts A and B (and, if the Secretary determines appropriate, Part 
D) and may use other measures of allowed charges and measures of 
utilization of items and services. The Secretary shall seek comments 
through one or more mechanisms (other than notice and comment 
rulemaking) from stakeholders regarding the resource use methodology 
established under section 1848(r)(5) of the Act.
    On October 15, 2015, as required by section 1848(r)(2)(B) of the 
Act, we posted on the CMS Web site for public comment a list of the 
episode groups developed under section 1848(n)(9)(A) of the Act with a 
summary of the background and context to solicit stakeholder input as 
required by section 1848(r)(2)(C) of the Act. That posting is available 
at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/MACRA-MIPS-and-APMs/MACRA-MIPS-and-APMs.html. The public comment period closed on February 15, 2016.
(c) Relationship to the Value Modifier
    Currently, the physician value-based payment modifier established 
under section 1848(p) of the Act utilizes six cost measures (see 42 CFR 
414.1235): (1) A total per capita costs for all-attributed 
beneficiaries measure (which we will refer to as the total per capita 
cost measure); (2) a total per capita costs for all attributed 
beneficiaries with chronic obstructive pulmonary disease (COPD) 
measure; (3) a total per capita costs for all attributed beneficiaries 
with congestive heart failure (CHF) measure; (4) a total per capita 
costs for all attributed beneficiaries with coronary artery disease 
(CAD) measure; (5) a total per capita costs for all attributed 
beneficiaries with diabetes mellitus (DM) measure; and (6) a Medicare 
Spending Per Beneficiary (MSPB) measure.
    Total per capita costs include payments under both Part A and Part 
B, but do not include Medicare payments under Part D for drug expenses. 
All cost measures for the VM are attributed at the physician group and 
solo practice level using the Medicare-enrolled billing TIN under a 
two-step attribution methodology. They are risk-adjusted and payment-
standardized, and the expected cost is adjusted for the TIN's specialty 
composition. We refer readers to our discussions of these total per 
capita cost measures (76 FR 73433 through 73434, 77 FR 69315 through 
69316), MSPB measure (78 FR 74774 through 74780, 80 FR 71295 through 
71296), payment standardization methodology (77 FR 69316 through 
69317), risk adjustment methodology (77 FR 69317 through 69318), and 
specialty adjustment methodology (78 FR 74781 through 74784) in earlier 
rulemaking for the VM. More information about these total per capita 
cost measures may be found in documents under the links titled 
``Measure Information Form: Overall Total Per Capita Cost Measure,'' 
``Measure Information Form: Condition-Specific Total Per Capita Cost 
Measures,'' and ``Measure Information Form: Medicare Spending Per

[[Page 28198]]

Beneficiary Measure'' available at https://www.cms.gov/medicare/medicare-fee-for-service-payment/physicianfeedbackprogram/valuebasedpaymentmodifier.html.
    The total per capita cost measures use a two-step attribution 
methodology that is similar, but not exactly the same, as the 
assignment methodology used for the Shared Savings Program. The 
attribution focuses on the delivery of primary care services (77 FR 
69320) by both primary care clinicians and specialists. The MSPB 
measure has a different attribution methodology. It is attributed to 
the TIN that provides the plurality of Medicare Part B claims (as 
measured by allowable charges) during the index inpatient 
hospitalization. We refer readers to the discussion of our attribution 
methodologies (77 FR 69318 through 69320, 79 FR 67960 through 67964) in 
prior rulemaking for the VM.
    These total per capita cost measures include payments for a 
calendar year and have been reported to TINs for several years through 
the Quality and Resource Use Reports (QRURs), which are issued as part 
of the Physician Feedback Program under section 1848(n) of the Act. The 
total per capita cost measures have been used in the calculation of the 
VM payment adjustments beginning with the 2015 payment adjustment 
period and the MSPB measure has been used in the calculation of the VM 
payment adjustments beginning with the 2016 payment adjustment period. 
More information about the current attribution methodology for these 
measures is available in the ``Fact Sheet for Attribution in the Value-
Based Payment Modifier Program'' document available at https://www.cms.gov/medicare/medicare-fee-for-service-payment/physicianfeedbackprogram/valuebasedpaymentmodifier.html.
    In the MIPS and APMs RFI (80 FR 59102 through 59113), we solicited 
feedback on the resource use performance category. Commenters directed 
our attention towards the ``2015 Value-Based Payment Modifier Program 
Experience Report'' (document available at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Downloads/2015-VM-Program-Experience-Rpt.pdf) for data demonstrating 
that physicians treating the largest shares of the Medicare's sickest 
patients are most likely to incur downward adjustments under the 
current program. Commenters suggested that CMS could risk adjust cost 
measures for differences in beneficiary characteristics impacting 
health and cost outcomes, and suggested that cost measure benchmarks 
could be stratified so that groups and solo practitioners are compared 
to other groups and individual practitioners treating beneficiaries 
with similar risk profiles. Commenters also expressed concern that 
current attribution methods are holding many clinicians accountable for 
costs they have no control over, while other clinicians have no 
patients attributed and no way of calculating accurate scores. 
Commenters generally believe episode-based costs could provide a more 
accurate measure in calculating resource use and comparing clinicians 
based on the cost of patient treatment episodes. Many commenters agreed 
that if properly selected and designed, measures tied to episodes of 
care could increase the relevance, reliability, and applicability of 
resource use measures and make feedback reports more actionable. 
However, in order for clinicians to be responsible for resource use, 
including episode-based costs, commenters strongly emphasized the need 
for access to timely and actionable information regarding these costs. 
Commenters have expressed concern that because certain VM measures were 
developed for hospitals they are not properly applied to clinician 
practices, which do not have Medicare patient populations large enough 
or heterogeneous enough to produce an accurate picture for resource 
use. Commenters requested that CMS make an effort to use resource 
measures which have been tested for use in clinician practices. 
Commenters supported development of new measures based on clinical 
guidelines and/or appropriate use criteria (AUC), and support the 
related ``Choosing Wisely'' campaign. In future years, individual 
specialties might decide to use AUC or ``Choosing Wisely'' guidelines 
in the creation of resource use measures applicable to their members. 
In these cases, CMS could consider adoption of evidence-based measures 
developed through a multi-specialty, clinician-led process.
(2) Weighting in the Composite Performance Score
    As required by section 1848(q)(5)(E)(i)(II)(bb) of the Act, the 
resource use performance category shall make up no more than 10 percent 
of the CPS for the first MIPS payment year (CY 2019) and not more than 
15 percent of the CPS the second MIPS payment year (CY 2020). 
Therefore, we propose at Sec.  414.1350 that the resource use 
performance category would make up 10 percent of the CPS for the first 
MIPS payment year (CY 2019) and 15 percent of the CPS for the second 
MIPS payment year (CY 2020). As required by section 
1848(q)(5)(E)(i)(II)(aa) of the Act and proposed at Sec.  414.1350, 
starting with the third MIPS payment year and for each MIPS payment 
year thereafter, the resource use performance category would make up 30 
percent of the CPS.
(3) Resource Use Criteria
    As discussed above in section II.E.5.a. of this proposed rule, 
performance in the resource use performance category would be assessed 
using measures based on administrative Medicare claims data. At this 
time, we are not proposing any additional data submissions for the 
resource use performance category. As such, MIPS eligible clinicians 
and groups would be assessed based on resource use for Medicare 
patients only and only for patients that are attributed to them. MIPS 
eligible clinicians or groups that do not have enough attributed cases 
to meet or exceed the case minimums proposed in sections 
II.E.5.e.(3)(a)(ii) and II.E.5.e.(3)(b)(ii) would not be measured on 
resource use. For more discussion of MIPS eligible clinicians and 
groups without a resource use performance category score, please refer 
to II.E.6.a.(3)(d) and II.E.6.b.
(a) Value Modifier Cost Measures Proposed for the MIPS Resource Use 
Performance Category
    For purposes of assessing performance of MIPS eligible clinicians 
on the resource use performance category, we propose at Sec.  414.1350 
to specify resource use measures for a performance period. For the CY 
2017 MIPS performance period, we propose to utilize the total per 
capita cost measure, the MSPB measure, and several episode-based 
measures discussed in section II.E.5.e.3.b. of this proposed rule for 
the resource use performance category. The total per capita costs 
measure and the MSPB measure are described above in section 
II.E.5.e.(1)(c) of this proposed rule.
    We propose including the total per capita cost measure as it is a 
global measure of all Part A and Part B resource use during the 
performance period and inclusive of the four condition specific 
measures under the VM (chronic obstructive pulmonary disease, 
congestive heart failure, coronary artery disease, and diabetes 
mellitus) for which performance tends to be correlated and its 
inclusion was supported by commenters on the MIPS and APMs RFI (80 FR 
59102 through 59113). We also anticipate that MIPS eligible clinicians 
are familiar with the total per capita cost measure as the measure has 
been in the VM since 2015

[[Page 28199]]

and feedback has been reported through the annual QRUR to all groups 
starting in 2014.
    We propose to adopt the MSPB measure because by the beginning of 
the initial MIPS performance period in 2017, we believe most MIPS 
eligible clinicians will be familiar with the measure in the VM or its 
variant under the Hospital Value Based Purchasing program. However, we 
propose two technical changes to the MSPB measure calculations for 
purposes of its adoption in MIPS which are discussed in the reliability 
section II.E.5.e.3.a.ii. of this proposed rule.
    We propose to use the same methodologies for payment 
standardization, and risk adjustment for these measures for the 
resource use performance category as are defined for the VM. For more 
details on the previously adopted payment standardization methodology 
see 77 FR 69316 through 69317. For more details on the previously 
adopted risk adjustment methodology see 77 FR 69317 through 69318.
    We are not proposing to include the VM total per capita cost 
measures for the four condition-specific groups (chronic obstructive 
pulmonary disease, congestive heart failure, coronary artery disease, 
and diabetes mellitus). Instead, we are generally proposing to assess 
performance as part of the episode-based measures proposed under 
section II.E.5.e.3.b. of this proposed rule. This shift is in response 
to feedback received as part of the MIPS and APMs RFI (80 FR 59102 
through 59113). In the MIPS and APMs RFI, commenters stated that they 
do not believe the existing condition-based measures under the VM are 
relevant to their practice and expressed support for episode-based 
measures under MIPS.
(i) Attribution
    In the VM, all cost measures are attributed to a TIN. In MIPS, 
however, we are proposing to evaluate performance at the individual and 
group levels. Please refer to section II.E.5.e.(3)(c) of this proposed 
rule, for our proposals to address attribution differences for 
individuals and groups. For purposes of this section, we will use the 
general term MIPS eligible clinicians to indicate attribution for 
individuals or groups.
    For the MSPB measure, we propose to use attribution logic that is 
similar to what is used in the VM. MIPS eligible clinicians with the 
plurality of claims (as measured by allowable charges) for Medicare 
Part B services, rendered during an inpatient hospitalization that is 
an index admission for the MSPB measure during the applicable 
performance period would be assigned the episode. The only difference 
from the VM attribution methodology would be that the MSPB measure 
would be assigned differently for individuals than for groups. For the 
total per capita cost measure, we propose to use a two-step attribution 
methodology that is similar to the methodology used in the 2017 and 
2018 VM. We also propose to have the same two-step attribution process 
for the claims-based population measures in the quality performance 
category (section II.E.5.b.6.), CMS Web Interface measures, and CAHPS 
for MIPS. However, we also propose to make some modifications to the 
primary care services definition that is used in the attribution 
methodology to align with policies adopted under the Shared Savings 
Program.
    The VM currently defines primary care services as the set of 
services identified by the following HCPCS/CPT codes: 99201 through 
99215, 99304 through 99340, 99341 through 99350, the welcome to 
Medicare visit (G0402), and the annual wellness visits (G0438 and 
G0439). We propose to update this set to include new care coordination 
codes that have been implemented in the Medicare Physician Fee 
Schedule: Transitional care management (TCM) codes (CPT codes 99495 and 
99496) and the chronic care management (CCM) code (CPT code 99490). 
These services were added to the primary care service definition used 
by the Shared Saving Program in June 2015 (80 FR 32746 through 32748). 
We believe that these care coordination codes would also be appropriate 
for assigning services in the MIPS.
    In the CY 2016 PFS final rule, the Shared Saving Program also 
finalized another modification to the primary care service definition: 
To exclude nursing visits that occur in a skilled nursing facility 
(SNF) (80 FR 71271 through 71272). Patients in SNFs (POS 31) are 
generally shorter stay patients who are receiving continued acute 
medical care and rehabilitative services. While their care may be 
coordinated during their time in the SNF, they are then transitioned 
back to the community. Patients in a SNF (POS 31) require more frequent 
practitioner visits--often from 1 to 3 times a week. In contrast, 
patients in nursing facilities (NFs) (POS 32) are almost always 
permanent residents and generally receive their primary care services 
in the facility for the duration of their life. Patients in the NF (POS 
32) are usually seen every 30 to 60 days unless medical necessity 
dictates otherwise. We believe that it would be appropriate to follow a 
similar policy in MIPS; therefore, we propose to exclude services 
billed under CPT codes 99304 through 99318 when the claim includes the 
POS 31 modifier from the definition of primary care services.
    We believe that making these two modifications would help align the 
primary care service definition between MIPS and Shared Savings Program 
and would improve the results from the 2-step attribution process.
    We note, however, that while we are aligning the definition for 
primary care services, the 2-step attribution for MIPS would be 
different than the one used for the Shared Saving Program. We believe 
there are valid reasons to have differences between MIPS and the Shared 
Savings Program attribution. For example, as discussed in CY 2015 PFS 
final rule (79 FR 67960 through 67962), we eliminated the primary care 
service pre-step that is statutorily required for the Shared Savings 
Program from the VM. We noted that without the pre-step, the 
beneficiary attribution method would more appropriately reflect the 
multiple ways in which primary care services are provided, which are 
not limited to physician groups. As MIPS eligible clinicians include 
more than physicians, we continue to believe it is appropriate to 
exclude the pre-step.
    In addition, in the 2015 Shared Saving Program final rule, we 
finalized a policy for the Shared Savings Program that we did not 
extend to the VM 2-step attribution: to exclude select specialties 
(such as several surgical specialties) from the second attribution step 
(80 FR 32749 through 32754). We do not believe it is appropriate to 
restrict specialties from the second attribution step for MIPS. If such 
a policy were adopted under MIPS, then all specialists on the exclusion 
list, unless they were part of a multispecialty group, would 
automatically be excluded from measurement on the total per capita cost 
measure, as well as on the claims-based population measures which rely 
on the same 2-step attribution. While we do not believe that many MIPS 
eligible clinicians or clinician groups with these specialties would be 
attributed enough cases to meet or exceed the case minimum, we believe 
that an automatic exclusion could remove some MIPS eligible clinicians 
and groups that should be measured for resource use.
    We request comments on these proposed changes.
(ii) Reliability
    Additionally, we seek to ensure that MIPS eligible clinicians and 
groups are measured reliably; therefore, we intend to use the 0.4 
reliability threshold currently applied to measures under the

[[Page 28200]]

VM to evaluate their reliability. A 0.4 reliability threshold standard 
means that the majority of MIPS eligible clinicians and groups who meet 
the case minimum required for scoring under a measure have measure 
reliability scores that exceed 0.4. We generally consider reliability 
levels between 0.4 and 0.7 to indicate ``moderate'' reliability and 
levels above 0.7 to indicate ``high'' reliability. In cases where we 
have considered high participation in the applicable program to be an 
important programmatic objective, such as the Hospital VBP Program, we 
have selected this 0.4 moderate reliability standard. We believe this 
standard ensures moderate reliability but does not substantially limit 
participation.
    To ensure sufficient measure reliability for the resource use 
performance category in MIPS, we also propose at Sec.  
414.1380(b)(2)(ii) to use the minimum of 20 cases for the total per 
capita cost measure, the same case minimum that is being used for the 
VM. An analysis in the CY 2016 PFS final rule (80 FR 71282) confirms 
that this measure has high average reliability for solo practitioners 
(0.74) as well as for groups with more than 10 professionals (0.80).
    In the CY 2016 PFS final rule, we finalized a policy that increases 
the minimum cases for the MSPB measure from 20 to 125 cases (80 FR 
71295 through 71296) due to reliability concerns with the measure 
including the specialty adjustment. That said, we recognize that a case 
size increase of this nature also may limit the ability of MIPS 
eligible clinicians to be scored on MSPB, and have been evaluating 
alternative measure calculation strategies for potential inclusion 
under MIPS that better balance participation, accuracy, and 
reliability. As a result of this, we are proposing two modifications to 
the MSPB measure.
    The first technical change we are proposing is to remove the 
specialty-adjustment from the MSPB measure's calculation. As currently 
reported on the QRURs, the MSPB measure is risk adjusted to ensure that 
these comparisons account for case-mix differences between 
practitioners' patient populations and the national average. It is 
unclear that the current additional adjustment for physician specialty 
improves the accounting for case-mix differences for acute care 
patients, and thus, may not be needed.
    The second technical change we propose is to modify the cost ratio 
used within the MSPB equation to evaluate the difference between 
observed and expected episode cost at the episode level before 
comparing the two at the individual or group level. In other words, 
rather than summing all of the observed costs and dividing by the sum 
of all the expected costs, we would take the observed to expected cost 
ratio for each MSPB episode assigned to the MIPS eligible clinician or 
group and take the average of the assigned ratios. As we did 
previously, we would take the average for the MIPS eligible clinician 
or group and multiply it by the average of observed costs across all 
episodes nationally.
    Our analysis, which is based on all Medicare Part A and B claims 
data for beneficiaries discharged from an acute inpatient hospital 
between January 1, 2013 and December 1, 2013, indicates that these two 
changes would improve the MSPB measure's ability to calculate costs and 
the accuracy with which it can be used to make clinician-level 
performance comparisons. We also believe that these changes would help 
ensure the MSPB measure can be applied to a greater number of MIPS 
eligible clinicians while still maintaining its status as a reliable 
measure. More specifically, our analysis indicates that after making 
these changes to the MSPB measure's calculations, the MSPB measure 
meets the desired 0.4 reliability threshold used in the VM for over 88 
percent of all TINs with a 20 case minimum, including solo 
practitioners. While this percentage is lower than our current policy 
for the VM (where virtually all TINs with 125 or more episodes have 
moderate reliability), setting the case minimum at 20 allows for an 
increase in participation in the MSPB measure. Therefore, we propose at 
Sec.  414.1380(b)(2)(ii) to use a minimum of 20 cases for the MSPB 
measure. As noted previously, we consider expanded participation of 
MIPS eligible clinicians, particularly individual reporters, to be of 
great import for the purposes of transitioning to MIPS and believe that 
this justifies a slight decrease of the percentage of TINs meeting the 
reliability threshold.
    We welcome public comment on these proposals.
(b) Episode-Based Measures Proposed for the MIPS Resource Use 
Performance Category
    As noted in the previous section, we are proposing to calculate 
several episode-based measures for inclusion in the resource use 
performance category. Groups have received feedback on their 
performance on episode-based measures through the Supplemental Quality 
and Resource Use Report (sQRUR), which are issued as part of the 
Physician Feedback Program under section 1848(n) of the Act; however, 
these measures have not been used for payment adjustments through the 
VM. Several stakeholders expressed in the MIPS and APMs RFI the desire 
to transition to episode-based measures and away from the general total 
per capita measures used in the VM. Therefore, in lieu of using the 
total per capita cost measures for populations with specific conditions 
that are used for the VM, we are proposing episode-based measures for a 
variety of conditions and procedures that are high cost, have high 
variability in resource use, or are for high impact conditions. In 
addition, as these measures are payment standardized and risk adjusted, 
we believe they meet the statutory requirements for appropriate 
measures of cost as defined in section 1848(p)(3) of the Act because 
the methodology eliminates the effects of geographic adjustments in 
payment rates and takes into account risk factors.
    We also reiterate that while we transition to using episode-based 
measures for payment adjustments, we will continue to engage 
stakeholders through the process specified in section 1848(r)(2) of the 
Act to refine and improve the episodes moving forward.
    As noted earlier, we have provided performance information on 
episode-based measures to MIPS eligible clinicians through the 
Supplemental Quality and Resource Use Reports (sQRURs), which are 
released in the Fall. The sQRURs provide groups and solo practitioners 
with information to evaluate their resource utilization on conditions 
and procedures that are costly and prevalent in the Medicare FFS 
population. To accomplish this goal, various episodes are defined and 
attributed to one or more groups or solo practitioners most responsible 
for the patient's care. The episode-based measures include Medicare 
Part A and Part B payments for services determined to be related to the 
triggering condition or procedure. The payments included are 
standardized to remove the effect of differences in geographic 
adjustments in payment rates and incentive payment programs and they 
are risk adjusted for the clinical condition of beneficiaries. Although 
the sQRURs provide detailed information on these care episodes, the 
calculations are not used to determine a TIN's VM payment adjustment 
and are only used to provide feedback.
    We propose to include in the resource use performance category 
several clinical condition and treatment episode-based measures that 
have been reported in the sQRUR or were included in the list of the 
episode groups developed under section 1848(n)(9)(A)

[[Page 28201]]

of the Act published on the CMS Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/MACRA-MIPS-and-APMs/MACRA-MIPS-and-APMs.html. The identified 
episode-based measures have been tested and previously published. 
Tables 4 and 5 list the 41 clinical condition and treatment episode-
based measures proposed for the CY 2017 MIPS performance period, as 
well as whether the episodes have previously been reported in a sQRUR.
    The measures listed in Table 4 were developed under section 
1848(n)(9)(A) of the Act, which required the Secretary to develop an 
episode grouper that combines separate but clinically related items and 
services into an episode of care for an individual, as appropriate, and 
provide reports on utilization to physicians (episode grouping Method 
A). The proposed measures accommodate both chronic and acute procedure 
episodes. The measures are also specifically designed to accommodate 
episodes that are initiated by physician claims, and section 1848(r)(4) 
of the Act requires claims submitted for items and services furnished 
by a physician or applicable practitioner on or after January 1, 2018, 
to include (as determined appropriate by the Secretary) the applicable 
codes established for care episode groups, patient condition groups, 
and patient relationship categories. The episodes and logic have 
undergone detailed and rigorous evaluation by an independent evaluation 
contractor and CMS also reviewed for clinical validity.
    Attribution and reliability for the measures are discussed later in 
this section. Information about how the measures are constructed can be 
found at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/MACRA-MIPS-and-APMs/MACRA-Feedback.html under the link for ``Method A--Technical.'' Detailed 
episode logic can be found under the ``Method A'' link on the same 
page.

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    Table 5 shows a second set of proposed measures that were developed 
to complement previous CMS efforts and to provide additional episode 
types to report in the supplemental QRURs. These measures represent 
acute conditions and procedures that are costly and prevalent in the 
Medicare FFS population. These measures examine services independently, 
regardless of other episodes a patient may be experiencing, and 
episodes do not interact with each other (episode grouping Method B).
    Some of the episode types listed in Table 5 have subtypes that 
provide additional clinical detail and improve the actionability of 
data reported on these episode types, as well as comparability to 
expected costs. All episode types were developed with clinical input 
and complement the existing MSPB measure currently used in the VM. In 
addition, all episode types were reported in 2014 sQRURs.
    Information about how the measures are constructed can be found at 
https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/MACRA-MIPS-and-APMs/MACRA-Feedback.html under the link for ``Method B--Technical.'' Detailed 
episode logic can be found under the ``Method B'' link on the same 
page.

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    While we are proposing the measures listed in Tables 4 and 5 for 
the resource use performance category, we are uncertain as to how many 
of these measures we will ultimately include in the final rule. As 
these measures have never been used for payment purposes, we may choose 
to specify a subset of these measures in the final rule. We request 
public comment on which of the measures listed in Tables 4 and 5 to 
include in the final rule. In addition to considering public comments, 
we intend to consider the number of MIPS eligible clinicians able to be 
measured, the episode's impact on Medicare Part A and Part B spending, 
and whether the measure has been reported through sQRUR. In addition, 
while we do not believe specialty adjustment is necessary for the 
episode-based measures, we will continue to explore this further given 
the diversity of episodes. We seek comment on whether we should 
specialty adjust the episode-based measures.
(i) Attribution
    For the episode-based measures listed in Tables 4 and 5, we propose 
to use the attribution logic used in the 2014 sQRUR (full description 
available at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Downloads/Detailed-Methods-2014SupplementalQRURs.pdf), with modifications to adjust for whether 
performance is being assessed at an individual level or group level. 
Please refer to section

[[Page 28208]]

II.E.5.e.(3)(c) of this proposed rule for our proposals to address 
attribution differences for individuals and groups. For purposes of 
this section, we will use the general term MIPS eligible clinicians to 
indicate attribution for individuals or groups.
    Acute condition episodes would be attributed to all MIPS eligible 
clinicians that bill at least 30 percent of inpatient evaluation and 
management (IP E&M) visits during the initial treatment, or ``trigger 
event,'' that opened the episode. E&M visits during the episode's 
trigger event represent services directly related to the management of 
the beneficiary's acute condition episode. MIPS eligible clinicians 
that bill at least 30 percent of IP E&M visits are therefore likely to 
have been responsible for the oversight of care for the beneficiary 
during the episode. It is possible for more than one MIPS eligible 
clinician to be attributed a single episode using this rule. If an 
acute condition episode has no IP E&M claims during the episode, then 
that episode is not attributed to any MIPS eligible clinician.
    Procedural episodes would be attributed to all MIPS eligible 
clinicians that bill a Medicare Part B claim with a trigger code during 
the trigger event of the episode. For inpatient procedural episodes, 
the trigger event is defined as the IP stay that triggered the episode 
plus the day before the admission to the IP hospital. For outpatient 
procedural episodes constructed using Method A, the trigger event is 
defined as the day of the triggering claim plus the day before and two 
days after the trigger date. For outpatient procedural episodes 
constructed using Method B, the trigger event is defined as only the 
day of the triggering claim. Any Medicare Part B claim or line during 
the trigger event with the episode's triggering procedure code is used 
for attribution. If more than one MIPS eligible clinician bills a 
triggering claim during the trigger event, the episode is attributed to 
each of the MIPS eligible clinicians. If co-surgeons bill the 
triggering claim, the episode is attributed to each MIPS eligible 
clinician. If only an assistant surgeon bills the triggering claim, the 
episode is attributed to the assistant surgeon or group. If an episode 
does not have a concurrent Part B claim with a trigger code for the 
episode, then that episode is not attributed to any MIPS eligible 
clinician.
(ii) Reliability
    To ensure moderate reliability, we propose at Sec.  
414.1380(b)(2)(ii) to use the minimum of 20 cases for all episode-based 
measures listed in Tables 4 and 5. We propose to not include any 
measures that do not have average moderate reliability (at least 0.4) 
at 20 episodes.
(c) Attribution for Individual and Groups
    In the VM and sQRUR, all resource use measurement was attributed at 
the solo practitioner and group level, as identified by TIN. In MIPS, 
however, we are proposing to evaluate performance at the individual and 
group levels. For MIPS eligible clinicians whose performance is being 
assessed individually across the other MIPS performance categories, we 
propose to attribute resource use measures using TIN/NPI rather than 
TIN. Attribution at the TIN/NPI level allows individual MIPS eligible 
clinicians, as identified by their TIN/NPI, to be measured based on 
cases that are specific to their practice, rather than being measured 
on all the cases attributed to the group TIN. For MIPS eligible 
clinicians that choose to have their performance assessed as a group 
across the other MIPS performance categories, we propose to attribute 
resource use measures at the TIN level (the group TIN under which they 
report). The logic for attribution would be similar whether attributing 
to the TIN/NPI level or the TIN level. As an alternative proposal, we 
seek comment on whether MIPS eligible clinicians that choose to have 
their performance assessed as a group should first be attributed at the 
individual TIN/NPI level and then have all cases assigned to the 
individual TIN/NPIs attributed to the group under which they bill. This 
alternative would apply one consistent methodology to both groups and 
individuals, compared to having a methodology that assigns cases using 
TIN/NPI for assessment at the individual level and another that assigns 
cases using only TIN for assessment at the group level. For example, 
the general attribution logic for MSPB is to assign the MSPB measure 
based on the plurality of claims (as measured by allowable charges) for 
Medicare Part B services rendered during an inpatient hospitalization 
that is an index admission for the MSPB measure. Our proposed approach 
would determine ``plurality of claims'' separately for individuals and 
groups. For individuals, we would assign the MSPB measure using the 
``plurality of claims'' by TIN/NPI, but for groups we would determine 
the ``plurality of claims'' by TIN. The alternative proposal, in 
contrast, would determine the ``plurality of claims'' by TIN/NPI for 
both groups and individuals. However, for individuals, only the MSPB 
measure attributed to the TIN/NPI would be evaluated, while for groups 
the MSPB measure attributed to any TIN/NPI billing under the TIN would 
be evaluated.
    We request comment on this proposal and alternative considered.
(d) Application of Measures to Non-Patient Facing MIPS Eligible 
Clinicians
    Section 101(c) of the MACRA added section 1848(q)(2)(C)(iv) to the 
Act, which requires the Secretary to give consideration to the 
circumstances of professional types who typically furnish services 
without patient facing interaction (non-patient-facing) when 
determining the application of measures and activities. In addition, 
this section allows the Secretary to apply alternative measures or 
activities to non-patient facing MIPS eligible clinicians that fulfill 
the goals of a performance category. Section 101(c) of the MACRA also 
added section 1848(q)(5)(F) to the Act, which allows the Secretary to 
re-weight MIPS performance categories if there are not sufficient 
measures and activities applicable and available to each type of 
eligible clinician involved.
    For the 2017 MIPS performance period, we are not proposing any 
alternative measures for non-patient facing MIPS eligible clinicians or 
groups. This means that non-patient facing MIPS eligible clinicians or 
groups may not be attributed any resource use measures that are 
generally attributed to clinicians who have patient facing encounters 
with patients. We therefore anticipate that, similar to MIPS eligible 
clinicians or groups that do not meet the required case minimum for any 
resource use measures, many non-patient facing MIPS eligible clinicians 
may not have sufficient measures and activities available to report and 
would not be scored on the resource use performance category under 
MIPS. We refer readers to section II.E.6.b.2. of this proposed rule 
where we discuss how we would address performance category weighting 
for MIPS eligible clinicians or groups who do not receive a performance 
category score for a given performance category. We also intend to work 
with non-patient facing MIPS eligible clinicians and specialty 
societies to propose alternative resource use measures for non-patient 
facing MIPS eligible clinicians and groups under MIPS in future years. 
Lastly, we seek comment on how best to incorporate appropriate 
alternative resource use measures for all MIPS eligible clinician 
types, including non-patient facing MIPS eligible clinicians.
(e) Additional System Measures
    Section 1848(q)(2)(C)(ii) of the Act, as added by section 101(c) of 
MACRA

[[Page 28209]]

provides that the Secretary may use measures used for a payment system 
other than for physicians, such as measures for inpatient hospitals, 
for purposes of the quality and resource use performance categories of 
MIPS. The Secretary, however, may not use measures for hospital 
outpatient departments, except in the case of items and services 
furnished by emergency physicians, radiologists, and anesthesiologists.
    We intend to align any facility-based MIPS measure decision across 
the quality and resource use performance categories to ensure 
consistent policies for MIPS in future years. We refer readers back to 
section II.E.5.b.5. of this proposed rule, which discusses our strategy 
and solicits comments related to this provision.
(4) Future Modifications to Resource Use Performance Category
    In the future, we intend to consider how best to incorporate Part D 
costs into the resource use performance category, as described in 
section 1848(q)(2)(B)(ii) of the Act. We seek public comments on how we 
should incorporate those costs under MIPS for future years. We also 
intend to continue developing and refining episode groups for purposes 
of resource use performance category measure calculations.
f. Clinical Practice Improvement Activity (CPIA) Category
(1) Background
(a) General Overview and Strategy
    The CPIA performance category focuses on one of our MIPS strategic 
goals, to use a patient-centered approach to program development that 
leads to better, smarter, and healthier care. We believe improving the 
health of all Americans can be accomplished by developing incentives 
and policies that drive improved patient health outcomes. CPIAs 
emphasize activities that have a proven association with improved 
health outcomes. The CPIA performance category also focuses on another 
MIPS strategic goal which is to use design incentives that drive 
movement toward delivery system reform principles and APMs. Another 
MIPS strategic goal we are striving to achieve is to establish policies 
that can be scaled in future years as the bar for improvement rises. 
Under the CPIA performance category we are proposing baseline 
requirements that will continue to have more stringent requirements in 
future years, and lay the groundwork for expansion towards continuous 
improvement over time.
(b) The MACRA Requirements
    Section 1848(q)(2)(C)(v)(III) of the Act defines a CPIA as an 
activity that relevant eligible clinician organizations and other 
relevant stakeholders identify as improving clinical practice or care 
delivery, and that the Secretary determines, when effectively executed, 
is likely to result in improved outcomes. Section 1848(q)(2)(B)(iii) of 
the Act requires the Secretary to specify CPIAs under subcategories for 
the performance period, which must include at least the subcategories 
specified in section 1848(q)(2)(B)(iii)(I) through (VI) of the Act, and 
in doing so to give consideration to the circumstances of small 
practices (consisting of 15 or fewer clinicians), and practices located 
in rural areas and geographic health professional shortage areas 
(HPSAs).
    Section 1848(q)(2)(C)(iv) of the Act generally requires the 
Secretary to give consideration to the circumstances of non-patient-
facing MIPS eligible clinicians or groups and allows the Secretary, to 
the extent feasible and appropriate, to apply alternative measures and 
activities to such MIPS eligible clinicians and groups.
    Section 1848(q)(2)(C)(v) of the Act required the Secretary to use a 
request for information (RFI) to solicit recommendations from 
stakeholders to identify CPIAs and specify criteria for such CPIAs, and 
provides that the Secretary may contract with entities to assist in 
identifying activities, specifying criteria for the activities, and 
determining whether MIPS eligible clinicians or groups meet the 
criteria set. In the MIPS and APMs RFI, we requested recommendations to 
identify activities and specify criteria for activities. In addition, 
we requested details on how data should be submitted, the number of 
activities, how performance should be measured, and what considerations 
should be made for small and/or rural practices. There were two 
overarching themes from the comments that we received. First, the 
majority of the comments indicated that all subcategories should be 
weighted equally and that MIPS eligible clinicians or groups should be 
allowed to select from whichever subcategories are most applicable to 
them during the performance period. Second, commenters supported 
inclusion of a diverse set of activities that are meaningful for 
individual MIPS eligible clinicians or groups. We have reviewed all of 
the comments that we received and have taken these recommendations into 
consideration while developing the proposed CPIA policies.
(2) Contribution to Composite Performance Score (CPS)
    Section 1848(q)(5)(E)(i)(III) of the Act specifies that the CPIA 
performance category will account for 15 percent of the CPS, subject to 
the Secretary's authority to assign different scoring weights under 
section 1848(q)(5)(F) of the Act. Therefore, we propose at Sec.  
414.1355, that the CPIA performance category will account for 15 
percent of the CPS.
    Section 1848(q)(5)(C)(i) of the Act specifies that a MIPS eligible 
clinician or group that is certified as a patient-centered medical home 
or comparable specialty practice, as determined by the Secretary, with 
respect to a performance period must be given the highest potential 
score for the CPIA performance category for the performance period. For 
a further description of APMs that have a certified patient centered-
medical home designation, we refer readers to section II.E.5.h.
    A patient-centered medical home will be recognized if it is a 
nationally recognized accredited patient-centered medical home, a 
Medicaid Medical Home Model, or a Medical Home Model. The NCQA Patient-
Centered Specialty Recognition will also be recognized, which qualifies 
as a comparable specialty practice. Nationally recognized accredited 
patient-centered medical homes are recognized if they are accredited 
by: (1) The Accreditation Association for Ambulatory Health Care; (2) 
the National Committee for Quality Assurance (NCQA) PCMH recognition; 
(3) The Joint Commission Designation; or (4) the Utilization Review 
Accreditation Commission (URAC).\8\ We refer readers to section II.F. 
of this proposed rule for further description of the Medicaid Medical 
Home Model or Medical Home Model.\9\ The criteria for being a 
nationally recognized accredited patient-centered medical home is that 
it must be national in scope and must have evidence of being used by a 
large number of medical organizations as the model for their patient-
centered medical home. We seek comment on our proposal for determining 
which practices would qualify as patient-centered medical homes. We 
also note that practices may receive a patient-centered medical home 
designation at a practice level, and that individual TINs may be 
composed of both undesignated practices and practices that have

[[Page 28210]]

received a designation as a patient-centered medical home (for example, 
only one practice site has received patient-centered medical home 
designation in a TIN that includes five practice sites). For MIPS 
eligible clinicians who choose to report at the group level, reporting 
is required at the TIN level. We solicit comment on how to provide 
credit for patient-centered medical home designations in the 
calculation of the CPIA performance category score for groups when the 
designation only applies to a portion of the TIN (for example, to only 
one practice site in a TIN that is comprised of five practice sites).
---------------------------------------------------------------------------

    \8\ Gans, D. (2014). A Comparison of the National Patient-
Centered Medical Home Accreditation and Recognition Programs. 
Medical Group Management Association, www.mgma.com.
---------------------------------------------------------------------------

    Section 1848(q)(5)(C)(ii) of the Act provides that MIPS eligible 
clinicians or groups who are participating in an APM (as defined in 
section 1833(z)(3)(C) of the Act) for a performance period must earn at 
least one half of the highest potential score for the CPIA performance 
category for the performance period. For further description of CPIA 
and the APM scoring standard for MIPS, we refer readers to section 
II.E.5.h. For all other MIPS eligible clinicians or groups, this 
section applies and we also refer readers to the scoring requirements 
for MIPS eligible clinicians and groups in section II.E.6. of this 
proposed rule.
    Section 1848(q)(5)(C)(iii) of the Act provides that a MIPS eligible 
clinician or group must not be a MIPS eligible clinician or group 
required to perform activities in each CPIA subcategory or participate 
in an APM to achieve the highest potential score for the CPIA 
performance category.
    Section 1848(q)(5)(B)(i) of the Act requires the Secretary to treat 
a MIPS eligible clinician or group that fails to report on an 
applicable measure or activity that is required to be reported, they 
will receive the lowest potential score applicable to the measure or 
activity.
(3) CPIA Data Submission Criteria
(a) Submission Mechanisms
    For the purpose of submitting under the CPIA performance category, 
we proposed in section II.E.5.a. of this proposed rule to allow for 
submission of data for the CPIA performance category using the 
qualified registry, EHR, QCDR, CMS Web Interface and attestation data 
submission mechanisms. If technically feasible, we will use 
administrative claims data to supplement the CPIA submission. 
Regardless of the data submission method, all MIPS eligible clinicians 
or groups must select activities from the CPIA Inventory provided in 
Table H of the Appendices. We believe the proposed data submission 
methods will allow for greater access and ease in submitting data, as 
well as consistency throughout the MIPS program.
    In addition, we propose at Sec.  414.1360, that for the first year 
only, all MIPS eligible clinicians or groups, or third party entities 
such as health IT vendors, QCDRs and qualified registries that submit 
on behalf of a MIPS eligible clinician or group, must designate a yes/
no response for activities on the CPIA Inventory. In the case where a 
MIPS eligible clinician or group is using a health IT vendor, QCDR, or 
qualified registry for their data submission, the MIPS eligible 
clinician or group will certify all CPIAs have been performed and the 
health IT vendor, QCDR, or qualified registry will submit on their 
behalf. An agreement between a MIPS eligible clinician or group and a 
health IT vendor, QCDR, or qualified registry for data submission for 
CPIA as well as other performance data submitted outside of the CPIA 
performance category could be contained in a single agreement, 
minimizing the burden on the MIPS eligible clinician or group. See 
section II.E.9 for additional details.
    We propose to use the administrative claims method, if technically 
feasible, only to supplement CPIA submissions. For example, if 
technically feasible, MIPS eligible clinicians or groups, using the 
telehealth modifier GT, could get automatic credit for this activity. 
We request comments on these proposals.
(b) Weighted Scoring
    While we considered both equal and differentially weighted scoring 
in this performance category, the statute requires a differentially 
weighted scoring model by requiring 100 percent of the potential score 
in the CPIA performance category for patient-centered medical home 
participants, and a minimum 50 percent score for APM participants. For 
additional activities in this category, we propose at Sec.  414.1380 a 
differentially weighted model for the CPIA performance category with 
two categories: Medium and high. The justification for these two 
weights is to provide flexible scoring due to the undefined nature of 
activities (that is, CPIA standards are not nationally recognized and 
there is no entity for CPIA that serves the same function as the 
National Quality Forum does for quality measures). CPIAs are weighted 
as high based on alignment with CMS national priorities and programs 
such as the Quality Innovation Network-Quality Improvement Organization 
(QIN/QIO) or the Comprehensive Primary Care Initiative which recognizes 
specific activities related to expanded access and integrated 
behavioral health as important. Programs that require performance of 
multiple activities such as participation in the Transforming Clinical 
Practice Initiative, seeing new and follow-up Medicaid patients in a 
timely manner in the provider's State Medicaid Program, or an activity 
identified as a public health priority (such as emphasis on 
anticoagulation management or utilization of prescription drug 
monitoring programs) were weighted as high.
    The statute references patient-centered medical homes as achieving 
the highest score for the MIPS program. MIPS eligible clinicians or 
groups may use that to guide them in the criteria or factors that 
should be taken into consideration to determine whether to weight an 
activity medium or high on comments for this proposal. We request 
comments on this proposal, including criteria or factors we should take 
into consideration to determine whether to weight an activity medium or 
high.
(c) Submission Criteria
    We propose at Sec.  414.1380 to set the CPIA submission criteria 
under MIPS, in order to achieve the highest potential score of 100 
percent, at three high-weighted CPIAs (20 points each) or six medium-
weighted CPIAs (10 points each), or some combination of high and 
medium-weighted CPIAs to achieve a total of 60 points for MIPS eligible 
clinicians participating as individuals or as groups (refer to Table H 
of the Appendices for CPIAs and weights). MIPS eligible clinicians or 
groups that select less than the designated number of CPIAs will 
receive partial credit based on the weighting of the CPIA selected. To 
achieve a 50 percent score, one high-weighted and one medium-weighted 
CPIA or three medium-weighted CPIAs are required for these MIPS 
eligible clinicians or groups.
    Exceptions to the above apply for: MIPS small groups (consisting of 
15 or fewer clinicians), MIPS eligible clinicians and groups located in 
rural areas, MIPS eligible clinicians and groups that are located in 
geographic HPSAs, non-patient-facing MIPS eligible clinicians or groups 
or MIPS eligible clinicians, or groups that participate in an APM and/
or a patient-centered medical home submitting in MIPS.
    For MIPS eligible clinicians and groups that are small, located in 
rural areas or geographic HPSAs, or non-patient-facing MIPS eligible 
clinicians or groups, in order to achieve the highest score of 100 
percent, two CPIAs are required (either medium or high).

[[Page 28211]]

For MIPS eligible clinicians or groups that are small, located in rural 
areas, located in HPSAs, or non-patient-facing MIPS eligible clinicians 
or groups, in order to achieve a 50 percent score, one CPIA is required 
(either medium or high).
    MIPS eligible clinicians or groups that participate in APMs are 
considered eligible to participate under the CPIA performance category 
unless they are participating in an Advanced APM and they have met the 
Qualifying APM Participant (QP) thresholds or are Partial QPs that 
elect not to report information. A MIPS eligible clinician or group 
that is participating in an APM and participating under the CPIA 
performance category will receive 50 percent of the total CPIA score 
(30 points) just through their APM participation. These are MIPS 
eligible clinicians or groups that CMS identifies as participating in 
APMs for MIPS and may participate under the CPIA performance category. 
To achieve 100 percent of the total CPIA score, MIPS eligible 
clinicians or groups will need to identify that they participate in an 
alternative payment model (30 points) and also select additional CPIAs 
for an additional 30 points to reach the 60 point CPIA highest score.
    For further description of MIPS eligible clinicians or groups that 
are required to report to MIPS under the APM scoring standard and their 
CPIA scoring requirements, we refer readers to section II.E.5.h. For 
all other MIPS eligible clinicians or groups participating in APMs that 
would report to MIPS, this section applies and we also refer readers to 
the scoring requirements for these MIPS eligible clinicians or groups 
in section II.E.6.
    Since we cannot measure variable performance within a single CPIA, 
we propose at Sec.  414.1380 to compare the CPIA points associated with 
the reported activities against the highest number of points that are 
achievable under the CPIA performance category which is 60 points. We 
propose that the highest potential score of 100 percent can be achieved 
by selecting a number of activities that will add up to 60 points. MIPS 
eligible clinicians and groups, including those that are participating 
as an APM, and all those that select activities under the CPIA 
performance category can achieve the highest potential score of 60 
points by selecting activities that are equal to the 60-point maximum. 
We refer readers to scoring section II.E.6 for additional rationale for 
using 60 points for the first year.
    If a MIPS eligible clinician or group reports only one CPIA, we 
will score that activity accordingly, as 10 points for a medium-level 
activity or 20 points for a high-level activity. If a MIPS eligible 
clinician or group reports no CPIAs, then the MIPS eligible clinician 
or group would receive a zero score for the CPIA performance category. 
We believe this proposal allows us to capture variation in the total 
CPIAs reported.
    In addition, we believe these are reasonable criteria for MIPS 
eligible clinicians or groups to accomplish within the first year for 
three reasons: (1) In response to several stakeholder MIPS and APMs RFI 
comments, we are not recommending a minimum number of hours for 
performance of an activity; (2) we are offering a broad list of 
activities from which MIPS eligible clinicians or groups may select; 
and (3) also in response to MIPS and APMs RFI comments, we are 
proposing that an activity must be performed for at least 90 days 
during the performance period for CPIA credit. We intend to reassess 
this requirement threshold in future years. We do not believe it is 
appropriate to require a determined number of activities within a 
specific subcategory at this time. This proposal aligns with the 
requirements in section 1848(q)(2)(C)(iii) of the Act that states MIPS 
eligible clinicians or groups are not required to perform activities in 
each subcategory.
    Lastly, we recognize that working with a QCDR could allow a MIPS 
eligible clinician or group to meet the measure and activity criteria 
for multiple CPIAs. For the first year of MIPS, there are several CPIAs 
in the inventory that incorporate QCDR participation. Each activity 
must be selected and achieved separately for the first year of MIPS. A 
MIPS eligible clinician or group cannot receive credit for multiple 
activities just by selecting one activity that includes participation 
in a QCDR. As the CPIA inventory expands over time we are interested in 
receiving comments on what restrictions, if any, should be placed 
around CPIA measures and activities that incorporate QCDR 
participation.
(d) Required Period of Time for Performing an Activity
    We propose Sec.  414.1360 that MIPS eligible clinicians or groups 
must perform CPIAs for at least 90 days during the performance period 
for CPIA credit. We understand there are some activities that are 
ongoing whereas others may be episodic. We considered setting the 
threshold for the minimum time required for performing an activity to 
longer periods up to a full calendar year. However, after researching 
several organizations we believe a minimum of 90 days is a reasonable 
amount of time. Two illustrative examples of organizations that used 90 
days as a window for reviewing clinical practice improvements include 
practice improvement activities undertaken by anesthesiologists, as 
detailed in a study describing anesthesiologists' practice improvements 
as part of the Maintenance of Certification in Anesthesiology Program 
requiring a 90-day report back period, \10\ \11\ and a large Veteran's 
Administration health care program that set a 90-day window for 
reviewing improvements in the management of opioid dispensing.\12\
---------------------------------------------------------------------------

    \10\ Steadman R.H, Burden AR, Huang, YM, Gaba DM, et. al, 
Practice improvements based on participation in simulation for the 
maintenance of certification in anesthesiology program. 
Anesthesiology. 2015;122;1154-69.
    \11\ABMS cite.
    \12\ Westanmo A, Marshall P, Jones E, Burns K, Krebs EE., Opioid 
Dose Reduction in a VA Health Care System--Implementation of a 
Primary Care Population-Level Initiative. Pain Med. 2015;16(5);1019-
26.
---------------------------------------------------------------------------

    Additional clarification for how some activities meet the 90-day 
rule or if additional time is required are reflected in the description 
of that activity in Table H of the Appendices. In addition we propose 
that activities, where applicable, may be continuing (that is, could 
have started prior to the performance period and are continuing) or be 
adopted in the performance period as long as an activity is being 
performed for at least 90 days during the performance period.
    We anticipate in future years that extended CPIA time periods will 
be needed for certain activities. We will monitor the time period 
requirement to asses if allowing for extended time requirements may 
enhance the value associated with generating more effective outcomes, 
or conversely, the extended time may reveal that more time has little 
or no value added for certain activities when associated with desired 
outcomes. We request comments on this proposal.
(4) Application of CPIA to Non-Patient-Facing MIPS Eligible Clinicians 
and Groups
    We understand that non-patient-facing MIPS eligible clinicians and 
groups may have a limited number of measures and activities to report. 
Therefore, we propose at Sec.  414.1360 allowing non-patient-facing 
MIPS eligible clinicians and groups to report on a minimum of one 
activity to achieve partial credit or two activities to achieve full 
credit to meet the CPIA submission criteria. These non-patient-facing 
MIPS eligible clinicians and groups receive

[[Page 28212]]

partial or full credit for submitting one or two activities 
irrespective of any type of weighting, medium or high (for example, two 
medium activities will qualify for full credit). For scoring purposes, 
non-patient-facing MIPS eligible clinicians or groups receive 30 points 
per activity, regardless of whether the activity is medium or high. For 
example, one high activity and one medium activity could be selected to 
receive 60 points. Similarly, two medium activities could also be 
selected to receive 60 points.
    We anticipate the number of activities for non-patient-facing MIPS 
eligible clinicians or groups will increase in future years as we 
gather more data on the feasibility of performing CPIAs. As part of the 
process for identifying activities, we consulted with several 
organizations that represent a cross-section of non-patient-facing MIPS 
eligible clinicians and groups. An illustrative example of those 
consulted with include organizations that represent cardiologists 
involved in nuclear medicine, nephrologists who serve only in a 
consulting role to other providers, or pathologists who, while they 
typically function as a team, have different members that perform 
different roles within their specialty that are primarily non-patient-
facing.
    In the course of those discussions these organizations identified 
CPIAs they believed would be applicable. Comments on activities 
appropriate for non-patient-facing MIPS eligible clinicians or groups 
are reflected in the proposed CPIA Inventory across multiple 
subcategories. For example, several of these organizations suggested 
consideration for Appropriate Use Criteria (AUC). As a result, we have 
incorporated AUC into some of the activities. We encourage MIPS 
eligible clinicians or groups who are already required to use AUC (for 
example, for advanced imaging) to report a CPIA other than one related 
to appropriate use. Another example, under Patient Safety and Practice 
Assessment, is the implementation of an antibiotic stewardship program 
that measures the appropriate use of antibiotics for several different 
conditions (Upper Respiratory Infection (URI) treatment in children, 
diagnosis of pharyngitis, bronchitis treatment in adults) according to 
clinical guidelines for diagnostics and therapeutics. In addition, we 
request comments on what activities would be appropriate for non-
patient-facing MIPS eligible clinicians or groups to add to the CPIA 
Inventory in the future. We request comments on this proposal.
(5) Special Consideration for Small, Rural, or Health Professional 
Shortage Areas Practices
    As noted previously in this proposed rule, section 
1848(q)(2)(B)(iii) of the Act requires the Secretary, in establishing 
CPIAs, to give consideration to small practices (15 or fewer 
clinicians) and practices located in rural areas (proposed definition 
at Sec.  414.1305) and in geographic based HPSAs as designated under 
section 332(a)(1)(A) of the Public Health Service Act. In the MIPS and 
APMs RFI, we requested comments on how CPIAs should be applied to MIPS 
eligible clinicians or groups in small practices, in rural areas, and 
geographic HPSAs: If a lower performance requirement threshold or 
different measures should be established that will better allow those 
MIPS eligible clinicians or groups to perform well in this performance 
category, what methods should be leveraged to appropriately identify 
these practices, and what best practices should be considered to 
develop flexible and adaptable CPIAs based on the needs of the 
community and its population.
    We engaged high performing organizations, including several rural 
health clinics with 15 or fewer clinicians that are designated as 
geographic HPSAs, to provide feedback on relevant QIN/QIO activities 
based on their specific circumstances. Some examples provided include 
participation in implementation of self-management programs such as for 
diabetes, and early use of telemedicine, as in the one case for a top 
performing multi-specialty rural practice that covers 20,000 people 
over a 25,000-mile radius in a rural area of North Dakota. Comments on 
activities appropriate for MIPS eligible clinicians or groups located 
in rural areas or practices that are designated as geographic HPSAs are 
reflected in the proposed CPIA Inventory across multiple subcategories.
    Based on the review of comments and listening sessions, we propose 
at Sec.  414.1360 to accommodate small practices and practices located 
in rural areas, or geographic HPSAs for the CPIA performance category 
by allowing MIPS eligible clinicians or groups to submit a minimum of 
one activity to achieve partial credit or two activities to achieve 
full credit. These MIPS eligible clinicians or groups receive partial 
or full credit for submitting two activities of any type of weighting 
(for example, two medium activities will qualify for full credit). We 
anticipate the requirement on the number of activities for small 
practices and practices located in rural areas, or practices in 
geographic HPSAs will increase in future years as we gather more data 
on the feasibility of small practices and practices located in rural 
areas and practices located in geographic HPSAs to perform CPIAs. 
Therefore, we request comments on what activities would be appropriate 
for these practices for the CPIA Inventory in future years. We request 
comments on this proposal.
(6) CPIA Subcategories
    Section 1848(q)(2)(B)(iii) of the Act provides that the CPIA 
performance category must include at least the subcategories listed 
below. The statute also provides the Secretary discretion to specify 
additional subcategories for the CPIA performance category, which have 
also been included below.
     Expanded practice access, such as same day appointments 
for urgent needs and after-hours access to clinician advice.
     Population management, such as monitoring health 
conditions of individuals to provide timely health care interventions 
or participation in a QCDR.
     Care coordination, such as timely communication of test 
results, timely exchange of clinical information to patients and other 
MIPS eligible clinicians or groups, and use of remote monitoring or 
telehealth.
     Beneficiary engagement, such as the establishment of care 
plans for individuals with complex care needs, beneficiary self-
management assessment and training, and using shared decision-making 
mechanisms.
     Patient safety and practice assessment, such as through 
the use of clinical or surgical checklists and practice assessments 
related to maintaining certification.
     Participation in an APM, as defined in section 
1833(z)(3)(C) of the Act.
    In the MIPS and APMs RFI, we requested recommendations on the 
inclusion of the following five potential new subcategories:
     Promoting Health Equity and Continuity, including (a) 
serving Medicaid beneficiaries, including individuals dually eligible 
for Medicaid and Medicare, (b) accepting new Medicaid beneficiaries, 
(c) participating in the network of plans in the Federally Facilitated 
Marketplace or state exchanges, and (d) maintaining adequate equipment 
and other accommodations (for example, wheelchair access, accessible 
exam tables, lifts, scales, etc.) to provide comprehensive care for 
patients with disabilities.
     Social and Community Involvement, such as measuring

[[Page 28213]]

completed referrals to community and social services or evidence of 
partnerships and collaboration with the community and social services.
     Achieving Health Equity, as its own performance category 
or as a multiplier where the achievement of high quality in traditional 
areas is rewarded at a more favorable rate for MIPS eligible clinicians 
or groups that achieve high quality for underserved populations, 
including persons with behavioral health conditions, racial and ethnic 
minorities, sexual and gender minorities, people with disabilities, 
people living in rural areas, and people in geographic HPSAs.
     Emergency preparedness and response, such as measuring 
MIPS eligible clinician or group participation in the Medical Reserve 
Corps, measuring registration in the Emergency System for Advance 
Registration of Volunteer Health Professionals, measuring relevant 
reserve and active duty military MIPS eligible clinician or group 
activities, and measuring MIPS eligible clinician or group volunteer 
participation in domestic or international humanitarian medical relief 
work.
     Integration of primary care and behavioral health, such as 
measuring or evaluating such practices as: Co-location of behavioral 
health and primary care services; shared/integrated behavioral health 
and primary care records; or cross-training of MIPS eligible clinicians 
or groups participating in integrated care. This subcategory also 
includes integrating behavioral health with primary care to address 
substance use disorders or other behavioral health conditions, as well 
as integrating mental health with primary care.
    We recognize that quality improvement is a critical aspect of 
improving the health of individuals and the health care delivery system 
overall. We also recognize that this will be the first time MIPS 
eligible clinicians or groups will be measured on the quality 
improvement work on a national scale. We have approached the CPIA 
performance category with these principles in mind along with the 
overarching principle for the MIPS program that we are building a 
process that will have increasingly more stringent requirements over 
time.
    Therefore, for the first year of MIPS, we propose at Sec.  414.1365 
that the CPIA performance category include the subcategories of 
activities provided at section 1848(q)(2)(B)(iii) of the Act. In 
addition, we propose at Sec.  414.1365 adding the following 
subcategories: ``Achieving Health Equity'', ``Integrated Behavioral and 
Mental Health'', and ``Emergency Preparedness and Response.'' In 
response to multiple MIPS and APMs RFI comments requesting the 
inclusion of ``Achieving Health Equity,'' we are proposing to include 
this subcategory because: (1) It is important and may require targeted 
effort to achieve and so should be recognized when accomplished; (2) 
supports our national priorities and programs, such as Reducing Health 
Disparities; and (3) encourages ``use of plans, strategies, and 
practices that consider the social determinants that may contribute to 
poor health outcomes.'' (CMS, Quality Innovation Network Quality 
Improvement Organization Scope of Work: Excellence in Operations and 
Quality Improvement, 2014).
    Similarly, MIPS and APMs RFI comments strongly supported the 
inclusion of the subcategory of ``Integrated Behavioral and Mental 
Health'', citing that ``statistics show 50 percent of all behavioral 
health disorders are being treated by primary care and behavioral 
health integration.'' Additionally, according to MIPS and APMs RFI 
comments, behavioral health integration with primary care is already 
being implemented in numerous locations throughout the country. The 
third additional subcategory we propose to include is ``Emergency 
Preparedness and Response,'' based on MIPS and APMs RFI comments that 
encouraged us to consider this subcategory to help ensure that 
practices remain open during disaster and emergency situations and 
support emergency response teams as needed. Additionally, commenters 
were able to provide a sufficient number of recommended activities 
(that is, more than one) that could be included in the CPIA Inventory 
in all of these proposed subcategories and the subcategories included 
under section 1848(q)(2)(B)(iii) of the Act.
    We also seek public comments on two additional subcategories for 
future consideration:
     Promoting Health Equity and Continuity, including (a) 
serving Medicaid beneficiaries, including individuals dually eligible 
for Medicaid and Medicare, (b) accepting new Medicaid beneficiaries, 
(c) participating in the network of plans in the Federally Facilitated 
Marketplace or state exchanges, and (d) maintaining adequate equipment 
and other accommodations (for example, wheelchair access, accessible 
exam tables, lifts, scales, etc.) to provide comprehensive care for 
patients with disabilities; and
     Social and Community Involvement, such as measuring 
completed referrals to community and social services or evidence of 
partnerships and collaboration with community and social services.
    For these two subcategories, we are requesting activities that can 
demonstrate some improvement over time and go beyond current practice 
expectations. For example, maintaining existing medical equipment would 
not qualify for a CPIA, but implementing some improved clinical 
workflow processes that reduce wait times for patients with 
disabilities or improve coordination of care including activities that 
regularly provide additional assistance to find other care needed for 
patients with disabilities, would be some examples of activities that 
could show improvement in clinical practice over time.
    We request comments on these proposals.
(7) CPIA Inventory
    To implement the MIPS program, we are required to create an 
inventory of CPIAs. Consistent with our MIPS strategic goals, we 
believe it is important to create a broad list of activities that can 
be used by multiple practice types to demonstrate CPIAs and activities 
that may lend themselves to being measured for improvement in future 
years.
    We took several steps to ensure the initial CPIA Inventory is 
inclusive of activities in line with the statutory intent. We had 
numerous interviews with highly performing organizations of all sizes, 
conducted an environmental scan to identify existing models, 
activities, or measures that met all or part of the CPIA category, 
including the patient centered medical homes, the Transforming Clinical 
Practice Initiative (TCPI), Consumer Assessment of Healthcare Providers 
and Systems (CAHPS) surveys, and AHRQ's Patient Safety Organizations. 
In addition, we reviewed the CY 2016 PFS final rule with comment period 
(80 FR 70886) and the comments received in response to the MIPS and 
APMs RFI regarding the CPIA performance category. The CPIA Inventory 
was compiled as a result of the stakeholder input, an environmental 
scan, MIPS and MIPS and APMs RFI comments, and subsequent working 
sessions with AHRQ and ONC and additional communications with CDC, 
SAMHSA and HRSA.
    Based on the above discussions we established guidelines for CPIA 
inclusion based on one or more of the following criteria (in any 
order):
     Relevance to an existing CPIA subcategory (or a proposed 
new subcategory);

[[Page 28214]]

     Importance of an activity toward achieving improved 
beneficiary health outcome;
     Importance of an activity that could lead to improvement 
in practice to reduce health care disparities;
     Aligned with patient-centered medical homes;
     Representative of activities that multiple MIPS eligible 
clinicians or groups could perform (for example, primary care, 
specialty care);
     Feasible to implement, recognizing importance in 
minimizing burden, especially for small (15 or fewer clinicians) 
practices, practices in rural areas, or in areas designated as 
geographic HPSAs by HRSA;
     CMS is able to validate the activity; or
     Evidence supports that an activity has a high probability 
of contributing to improved beneficiary health outcomes.
    Activities that overlap with other performance categories were 
excluded unless there was a strong policy rationale to include it in 
the CPIA Inventory. We propose to use the CPIA Inventory for the first 
year of MIPS, as provided in Table H of the Appendices. For further 
description of how MIPS eligible clinicians or groups will be 
designated to submit to MIPS for CPIA, we refer readers to section 
II.E.6.h. For all other MIPS eligible clinicians or groups 
participating in APMs that would report to MIPS, this section applies 
and we also refer readers to the scoring requirements for these MIPS 
eligible clinicians or groups in section II.E.5. of this proposed rule.
    We request comments on the inventory and welcome suggestions for 
CPIAs for future years as well.
(a) CMS Study on CPIA and Measurement
(1) Study Purpose
    From our experience under the PQRS, VM, and Medicare EHR Incentive 
programs we have discovered that many providers have errors within 
their data sets, as well as issues understanding the data that 
corresponds to their selected quality measures. To help better 
understand the current processes and limitations, we propose to conduct 
a study on CPIAs and measurement to examine clinical quality workflows 
and data capture using a simpler approach to quality measures. The 
study will allow a limited number of selected MIPS eligible clinicians 
and groups to receive full credit (60 points) for the CPIA category.
    The lessons learned in this study on practice improvement and 
measurement may or may not influence changes to future MIPS data 
submission requirements. The goals of the study are to see whether 
there will be improved outcomes, reduced burden in reporting, and 
enhancements in clinical care by selected MIPS eligible clinicians 
desiring:
     A more data driven approach to quality measurement.
     Measure selection unconstrained with a CEHRT program or 
system.
     Improving data quality submitted to CMS.
     Enabling CMS get data more frequently and provide feedback 
more often.
(2) Study Participation Credit and Requirements
    Eligible clinicians and groups in the CMS study on practice 
improvement and measurement will receive full credit for the CPIA 
category of MIPS after successfully electing, participating and 
submitting data to CMS. Based on feedback and surveys from MIPS 
eligible clinicians, study measurement data will be made available to 
CMS throughout the study on at least a quarterly basis unless the MIPS 
eligible clinician or group agrees to submit data on a more frequent 
basis. Participants will be required to attend a monthly focus group to 
share lessons learned along with providing survey feedback to monitor 
effectiveness. The focus group will also include providing visual 
displays of data, workflows, and best practices to be shared amongst 
the participants to obtain feedback and make further improvements. The 
monthly focus groups will be used to learn from the practices on how to 
be more agile as we test new ways of measure recording and workflow.
    For the 2017 performance period, the participating MIPS eligible 
clinicians or groups would submit their data and workflows for a 
minimum of three MIPS clinical quality measures that are relevant and 
prioritized by their practice. One of the measures must be an outcome 
measure, and one must be a patient experience measure. The 
participating MIPS eligible clinicians could elect to report on more 
measures as this would provide more options from which to select in 
subsequent years for purposes of measuring improvement.
    If MIPS eligible clinicians or groups calculate the measures 
working with a QCDR, qualified registry, or CMS-approved third party 
intermediary, CMS will use the same data validation process described 
in section II.E.8.e. CMS will only collect the numerator and 
denominator for the measures selected for the overall population, all 
patients/all payers. This will enable the practices to build the 
measures based on what is important for their area of practice while 
increasing the quality of care.
    In future years, participating MIPS eligible clinicians or groups 
would select three of the measures for which they have baseline data 
from the 2017 performance period to compare against later performance 
years. Participants electing to continue in future years will be 
afforded the opportunity opt-in or opt-out following the successful 
submission of data to CMS. The first opportunity to continue in the 
study will be at the end of the 2017 performance period. Eligible 
clinicians who elect to join the study but fail to participate and/or 
fail to successfully submit the data required will be removed from the 
study. Unsuccessful study participants will then be subject to the full 
requirements for the CPIA category.
(3) Study Participation Eligibility
    Participation will be open to a limited number of MIPS eligible 
clinicians in rural settings and non-rural settings. A rural area is 
defined at Sec.  414.1305 and a non-rural area would be any MIPS 
eligible clinicians or groups not included as part of the rural 
definition. This test will be open to include up to 10 non-rural 
individual MIPS eligible clinicians or groups of less than three non-
rural MIPS eligible clinician's, 10 rural individual MIPS eligible 
clinicians or groups of less than three rural MIPS eligible 
clinician's, 10 groups of three to eight MIPS eligible clinicians, five 
groups of nine to twenty MIPS eligible clinicians, three groups of 
twenty-one to one hundred MIPS eligible clinicians, two groups of 
greater than 100 MIPS eligible clinicians, and two specialist groups of 
MIPS eligible clinicians. Eligible clinicians and groups will need to 
sign up from January 1, 2017, to January 31, 2017. The sign up process 
will utilize this web-based interface-- http://oncprojectracking.org/. 
Participants will be approved on a first come first served basis and 
must meet all the required criteria.
    We request comment on the study and welcome suggestions on future 
study topics.
(8) CPIA Policies for Future Years of the MIPS Program
(a) Proposed Approach for Identifying New Subcategories and New 
Activities
    We propose, for future years of, MIPS, to consider the addition of 
a new subcategory or activity to the CPIA

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Inventory only when the following criteria are met:
     The new subcategory represents an area that could 
highlight improved beneficiary health outcomes, patient engagement and 
safety based on evidence.
     The new subcategory has a designated number of activities 
that meet the criteria for a CPIA activity and cannot be classified 
under the existing subcategories.
     Newly identified subcategories would contribute to 
improvement in patient care practices or improvement in performance on 
quality measures and resource use performance categories.
    In future years, MIPS eligible clinicians or groups will have an 
opportunity to nominate additional subcategories, along with activities 
associated with each of those subcategories that are based on criteria 
specified for these activities, as discussed above.
    We request comments on this proposal.
(b) Request for Comments on Call for Measures and Activities Process 
for Adding New Activities and New Subcategories
    We plan to develop a call for measures and activities process for 
future years of MIPS, where MIPS eligible clinicians or groups and 
other relevant stakeholders may recommend activities for potential 
inclusion in the CPIA Inventory. As part of the process, MIPS eligible 
clinicians or groups would be able to nominate additional activities 
that we could consider adding to the CPIA Inventory. The MIPS eligible 
clinician or group or relevant stakeholder would be able to provide an 
explanation of how the activity meets all the criteria we have 
identified. This nomination and acceptance process would, to the best 
extent possible, parallel the annual call for measures process already 
conducted by CMS for quality measures. The final CPIA Inventory for the 
performance year would be published in accordance with the overall MIPS 
rulemaking timeline and program. In addition, in future years we 
anticipate developing a process and establishing criteria to remove or 
add new activities to CPIA.
    Additionally, prospective activities that are submitted through a 
QCDR could also be included as part of a beta-test process that may be 
instrumental for future years to determine whether that activity should 
be included in the CPIA Inventory based on specific criteria noted 
above. MIPS eligible clinicians or groups and groups that use QCDRs to 
capture data associated with an activity, for example the frequency in 
administering depression screening and a follow-up plan, may be asked 
to voluntarily submit that same data in year 2 to begin identifying a 
baseline for improvement for subsequent year analysis. This is not 
intended to require any MIPS eligible clinician or group to submit 
CPIAs only via QCDR from one year to the next or to require the same 
activity from one year to the next. Participation in doing so, however, 
can help to identify how activities can contribute to improve outcomes. 
This data submission process will be considered part of a beta-test to: 
(1) Determine if the activity is being regularly conducted and 
effectively executed and (2) if the activity warrants continued 
inclusion on the CPIA Inventory. The data will help capture baseline 
information to begin measuring improvement and inform the Secretary of 
the likelihood that the activity would result in improved outcomes. If 
an activity is submitted and reported by a QCDR, it would be reviewed 
by CMS for final inclusion in the CPIA Inventory the following year, 
even if these activities are not submitted through the future call for 
measures and activities process. We intend, in future performance 
years, to begin measuring CPIA data points for all eligible clinicians 
and to award scores based on performance and improvement. We solicit 
comment on how best to collect such CPIA data and factor it into future 
scoring under MIPS.
    We request comments on this approach and on any other 
considerations we should take into account when developing this type of 
approach for future rulemaking.
(c) Request for Comments on Use of QCDRs for Identification and 
Tracking of Future Activities
    In future years, we expect to learn more about CPIAs and how the 
inclusion of additional measures and activities captured by QCDRs could 
enhance the ability of MIPS eligible clinicians or groups to capture 
and report on more meaningful activities. This is especially true for 
specialty groups. In the future, we may propose use of QCDRs for 
identification and acceptance of additional measures and activities 
which is in alignment with section 1848(q)(1)(E) of the Act which 
encourages the use of QCDRs, as well as under section 
1848(q)(2)(B)(iii)(II) of the Act related to the population management 
subcategory. We recognize, through the MIPS and APMs RFI comments and 
interviews with organizations that represent non-patient-facing MIPS 
eligible clinicians or groups and specialty groups that QCDRs may 
provide for a more diverse set of measures and activities under CPIA 
than are possible to list under the current CPIA Inventory. This 
diverse set of measures and activities, which we can validate, affords 
specialty practices additional opportunity to report on more meaningful 
activities in future years. QCDRs may also provide the opportunity for 
longer-term data collection processes which will be needed for future 
year submission on improvement, in addition to achievement. Use of 
QCDRs also supports ongoing performance feedback and allows for 
implementation of continuous process improvements. We believe that for 
future years, QCDRs will be allowed to define specific CPIAs for 
specialty and non-patient-facing MIPS eligible clinicians or groups 
through the already-established QCDR approval process for measures and 
activities. We request comments on this approach.
g. Advancing Care Information Performance Category
(1) Background and Relationship to Prior Programs
(a) Background
    The American Recovery and Reinvestment Act of 2009 (ARRA), which 
included the Health Information Technology for Economic and Clinical 
Health Act (HITECH Act), amended Titles XVIII and XIX of the Act to 
authorize incentive payments and Medicare payment adjustments for EPs 
to promote the adoption and meaningful use of certified EHR technology 
(CEHRT). Section 1848(o) of the Act provides the statutory basis for 
the Medicare incentive payments made to meaningful EHR users. Section 
1848(a)(7) of the Act also establishes downward payment adjustments, 
beginning with calendar year (CY) 2015, for EPs who are not meaningful 
users of certified EHR technology for certain associated EHR reporting 
periods. (For a more detailed explanation of the statutory basis for 
the Medicare and Medicaid EHR Incentive Programs, see the July 28, 2010 
Stage 1 final rule titled, ``Medicare and Medicaid Programs; Electronic 
Health Record Incentive Program; Final Rule'' (75 FR 44316 through 
44317).)
    A primary policy goal of the EHR Incentive Program is to encourage 
and promote the adoption and use of certified EHR technology among 
Medicare and Medicaid health care providers to help drive the industry 
as a whole toward the use of certified EHR technology. As described in 
the final rule titled ``Medicare and Medicaid

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Programs; Electronic Health Record Incentive Program--Stage 3 and 
Modifications to Meaningful Use in 2015 Through 2017'' (Hereinafter 
referred to as the ``2015 EHR Incentive Programs Final Rule'') (80 FR 
62769), the HITECH Act outlined several foundational requirements for 
meaningful use and for EHR technology. CMS and ONC have subsequently 
outlined a number of key policy goals which are reflected in the 
current objectives and measures of the program and the related 
certification requirements (80 FR 62790). Current Medicare EP 
performance on these key goals is varied, with EPs demonstrating high 
performance on some objectives while others represent a greater 
challenge.
(b) MACRA Changes
    Section 1848(q)(2)(A) of the Act, as added by section 101(c) of the 
MACRA, includes the meaningful use of certified EHR technology as a 
performance category under the MIPS, referred to in this proposed rule 
as the advancing care information performance category, which will be 
reported by MIPS eligible clinicians as part of the overall MIPS 
program. As required by sections 1848(q)(2) and (5) of the Act, the 
four performance categories shall be used in determining the MIPS CPS 
for each MIPS eligible clinician. In general, MIPS eligible clinicians 
will be evaluated under all four of the MIPS performance categories, 
including the advancing care information performance category. This 
includes MIPS eligible clinicians who were not previously eligible for 
the EHR Incentive Program incentive payments under section 1848(o) of 
the Act or subject to the EHR Incentive Program payment adjustments 
under section 1848(a)(7) of the Act, such as physician assistants, 
nurse practitioners, clinical nurse specialists, certified registered 
nurse anesthetists, and hospital-based EPs (as defined in section 
1848(o)(1)(C)(ii) of the Act). Understanding that these MIPS eligible 
clinicians may not have prior experience with certified EHR technology 
and the objectives and measures under the EHR Incentive Program, we 
have proposed a scoring methodology within the advancing care 
information performance category that provides flexibility for MIPS 
eligible clinicians from early adoption of certified EHR technology 
through advanced use of health IT. We note that in section II.e.5.g.8.a 
of this proposed rule, we have also proposed to reweight the advancing 
care information performance category to zero in the MIPS composite 
performance score for certain hospital-based and other MIPS eligible 
clinicians where the measures proposed for this performance category 
may not be available or applicable to these types of MIPS eligible 
clinicians.
(c) Considerations in Defining Advancing Care Information Performance 
Category
    In implementing MIPS, we intend to develop the requirements for the 
advancing care Information performance category to continue supporting 
the foundational objectives of the HITECH Act, and to encourage 
continued progress on key uses such as health information exchange and 
patient engagement. These more challenging objectives are essential to 
leveraging certified EHR technology to improve care coordination and 
they represent the greatest potential for improvement and for 
significant impact on delivery system reform in the context of MIPS 
quality reporting.
    In developing the requirements and structure for the advancing care 
information performance category, we considered several approaches for 
establishing a framework that would naturally integrate with the other 
MIPS performance categories. We considered historical performance on 
the EHR Incentive Program objectives and measures, feedback received 
through public comment, and the long term goals for delivery system 
reform and quality improvement strategies.
    One approach we considered would be to maintain the current 
structure of the Medicare EHR Incentive Program and award full points 
for the advancing care information performance category for meeting all 
of the objectives and measures finalized in the 2015 EHR Incentive 
Programs final rule, and award zero points for failing to meet all of 
these requirements. This method would be consistent with the current 
EHR Incentive Program and is based on objectives and measures already 
established in rulemaking. However, we considered and dismissed this 
approach as it would not allow flexibility for MIPS eligible clinicians 
and would not allow CMS to effectively measure performance for MIPS 
eligible clinicians in the advancing care information performance 
category who have taken incremental steps toward the use of certified 
EHR technology, or to recognize exceptional performance for MIPS 
eligible clinicians who have excelled in any one area. This is 
particularly important as many MIPS eligible clinicians may not have 
had past experience relevant to the advancing care information 
performance category and use of EHR technology because they were not 
previously eligible to participate in the Medicare EHR Incentive 
Program. This approach also does not allow for differentiation among 
the objectives and measures that have high adoption and those where 
there is potential for continued advancement and growth.
    We subsequently considered several methods which would allow for 
more flexibility and provide CMS the opportunity to recognize partial 
or exceptional performance among MIPS eligible clinicians for the 
measures under the advancing care information performance category. We 
decided to design a framework that would allow for flexibility and 
multiple paths to achievement under this category while recognizing 
MIPS eligible clinicians' efforts at all levels. Part of this framework 
requires moving away from the concept of requiring a single threshold 
for a measure, and instead incentivizes continuous improvement, and 
recognizes onboarding efforts among late adopters and MIPS eligible 
clinicians facing continued challenges in full implementation of 
certified EHR technology in their practice.
(2) Advancing Care Information Performance Category Within MIPS
    In defining the advancing care information performance category for 
the MIPS, we considered stakeholder feedback and lessons learned from 
our experience with the Medicare EHR Incentive Program. Specifically, 
we considered feedback from the Stage 1 (75 FR 44313) and Stage 2 (77 
FR 53967) EHR Incentive Program rules, and the 2015 EHR Incentive 
Programs final rule (80 FR 62769), as well as comments received from 
the MIPS and APMs RFI (80 FR 59102). We have learned from this feedback 
that clinicians desire flexibility to focus on health IT implementation 
that is right for their practice. We have also learned that updating 
software, training staff and changing practice workflows to accommodate 
new technology can take time, and that clinicians need time and 
flexibility to focus on the health IT activities that are most relevant 
to their patient population. Clinicians also desire consistent 
timelines and reporting requirements in order to simplify and 
streamline the reporting process. Recognizing this, we have worked to 
align the advancing care information performance category with the 
other MIPS performance categories, which would streamline reporting 
requirements, timelines and measures in an effort to reduce burden on 
MIPS eligible clinicians.

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    The implementation of the advancing care information performance 
category is an important opportunity to increase clinician and patient 
engagement, improve the use of health IT to achieve better patient 
outcomes, and continue to meet the vision of enhancing the use of 
certified EHR technology as defined under the HITECH Act. As discussed 
later in this section, we are proposing in section II.E.5.g.6.a. new 
flexibility in how we would assess MIPS eligible clinician performance 
for the advancing care information performance category. We propose to 
emphasize performance in the objectives and measures that are the most 
critical and would lead to the most improvement in the use of health IT 
and health care quality. We intend to promote innovation so that 
technology can be interconnected easily and securely, and data can be 
accessed and directed where and when it is needed to support patient 
care. These objectives include Patient Electronic Access, Coordination 
of Care Through Patient Engagement and Health Information Exchange, 
which are essential to leveraging certified EHR technology to improve 
care. At the same time, we propose to eliminate reporting on objectives 
and measures in which the vast majority of clinicians already achieve 
high performance--which would reduce burden, encourage greater 
participation and direct MIPS eligible clinicians' attention to higher-
impact measures. Our proposal balances program participation with 
rewarding performance on high-impact objectives and measures, which we 
believe would make the overall program stronger and further the goals 
of the HITECH Act.
(a) Advancing the Goals of the HITECH Act in MIPS
    Section 1848(o)(2)(A) of the Act requires that the Secretary seek 
to improve the use of electronic health records and health care quality 
over time by requiring more stringent measures of meaningful use. In 
implementing MIPS and the advancing care information performance 
category, we seek to improve and encourage the use of certified EHR 
technology over time by adopting a new, more flexible scoring 
methodology, as discussed in section II.E.5.g.6. of this proposed rule, 
that would more effectively allow MIPS eligible clinicians to reach the 
goals of the HITECH Act, and would allow MIPS eligible clinicians to 
use EHR technology in a manner more relevant to their practice. This 
new, more flexible scoring methodology puts a greater focus on Patient 
Electronic Access, Coordination of Care Through Patient Engagement, and 
Health Information Exchange--objectives we believe are essential to 
leveraging certified EHR technology to improve care by engaging 
patients and furthering interoperability. This methodology would also 
de-emphasize objectives in which clinicians have historically achieved 
high performance with median performance rates of over 90 percent for 
the last 2 years. We believe shifting focus away from these objectives 
would reduce burden, encourage greater participation, and direct 
attention to other objectives and measures which require more 
attention. Through this flexibility, MIPS eligible clinicians would be 
incentivized to focus on those aspects of certified EHR technology that 
are most relevant to their practice, which we believe would lead to 
improvements in health care quality.
    We also seek to increase the adoption and use of certified EHR 
technology by incorporating such technology into the other MIPS 
performance categories. For example, in section II.6.a.2.f. of this 
proposed rule, we are proposing to incentivize electronic reporting by 
awarding a bonus point for submitting quality measure data using 
certified EHR technology. Additionally, in section II.E.5.f. of this 
proposed rule, we have aligned some of the activities under the CPIA 
performance category such as Care Coordination, Beneficiary Engagement 
and Achieving Health Equity with a focus on enhancing the use of 
certified EHR technology. We believe this approach would strengthen the 
adoption and use of EHR systems and program participation consistent 
with the provisions of section 1848(o)(2)(A) of the Act.
(b) Future Considerations
    We note that the increased flexibility and removal of previously 
established thresholds for reporting, as proposed in this section of 
this proposed rule, may appear to be a lower standard than what 
previously existed in the Medicare EHR Incentive Program. In reality, 
this restructuring of program requirements is geared toward increasing 
participation and EHR adoption. We believe this is the most effective 
way to encourage the adoption of certified EHR technology, and 
introduce new MIPS eligible clinicians to the use of EHR technology and 
health IT overall.
    We will continue to review and evaluate MIPS eligible clinician 
performance in the advancing care information performance category, and 
will consider evolutions in health IT over time as it relates to this 
performance category. Based on our ongoing evaluation, we expect to 
adopt changes to the scoring methodology for the advancing care 
information performance category to ensure the efficacy of the program 
and to ensure increased value for MIPS eligible clinicians, as well as 
to adopt more stringent measures of meaningful use as required by 
section 1848(o)(2)(A) of the Act.
    Potential changes may include establishing benchmarks for MIPS 
eligible clinician performance on the advancing care information 
performance category measures, and using these benchmarks as a baseline 
or threshold for future reporting. This may include scoring for 
performance improvement over time and the potential to reevaluate the 
efficacy of measures based on these analyses. For example, in future 
years we may use a MIPS eligible clinician's prior performance on the 
advancing care information performance category measures as comparison 
for the subsequent year's performance category score, or compare a MIPS 
eligible clinician's performance category score to peer groups to 
measure their improvement and determine a performance category score 
based on improvement over those benchmarks or peer group comparisons. 
This type of approach would drive continuous improvement over time 
through the adoption of more stringent performance standards for the 
advancing care information performance category measures.
    We are committed to continual review, improvement and increased 
stringency of the advancing care information performance category 
measures as directed under section 1848(o)(2)(A) of the Act both for 
the purposes of ensuring program efficacy as well as ensuring value for 
the MIPS eligible clinicians reporting the advancing care information 
performance category measures. We seek comment on further methods to 
increase the stringency of the advancing care information performance 
category measures in the future.
    We additionally seek comment on the concept of a holistic approach 
to health IT--one that we believe is similar to the concept of outcome 
measures in the quality performance category in the sense that MIPS 
eligible clinicians could potentially be measured more directly on how 
the use of health IT contributes to the overall health of their 
patients. Under this concept, MIPS eligible clinicians would be able to 
track certain use cases or patient outcomes to tie patient health 
outcomes with the use of health IT.
    We believe this approach would allow us to directly link health IT 
adoption and use to patient outcomes, moving

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MIPS beyond the measurement of EHR adoption and process measurement and 
into a more patient-focused health IT program. From comments and 
feedback we have received from the health care provider community, we 
understand that this type of approach would be a welcome enhancement to 
the measurement of health IT. At this time, we recognize that 
technology and measurement for this type of program is currently 
unavailable. We seek comment on what this type of measurement would 
look like under MIPS, including the type of measures that would be 
needed within the advancing care information performance category and 
the other performance categories to measure this type of outcome, what 
functionalities with certified EHR technology would be needed, and how 
such an approach could be implemented.
(3) Clinical Quality Measurement
    Section 1848(o)(2)(A)(iii) of the Act requires the reporting of 
clinical quality measures (CQMs) using certified EHR technology. 
Section 1848(q)(5)(B)(ii)(II) provides that under the methodology for 
assessing the total performance of each MIPS eligible clinician, the 
Secretary shall, with respect to a performance period for a year, for 
which a MIPS eligible clinician reports applicable measures under the 
quality performance category through the use of certified EHR 
technology, treat the MIPS eligible clinician as satisfying the CQMs 
reporting requirement under section 1848(o)(2)(A)(iii) of the Act for 
such year. We note that in the context and overall structure of MIPS, 
the quality performance category allows for a greater focus on patient-
centered measurement, and multiple pathways for MIPS eligible 
clinicians to report their quality measure data. Therefore, we are not 
proposing separate requirements for clinical quality measure reporting 
within the advancing care information performance category and instead 
would require submission of quality data for measures specified for the 
quality performance category, in which we encourage reporting of CQMs 
with data captured in certified EHR technology. We refer readers to 
section II.E.5.a of this proposed rule for discussion of reporting of 
CQMs with data captured in certified EHR technology under the quality 
performance category.
(4) Performance Period Definition for Advancing Care Information 
Performance Category
    In the Medicare and Medicaid Programs; Electronic Health Record 
Incentive Program--Stage 3 proposed rule, we proposed to eliminate the 
90-day EHR reporting period beginning in 2017 for EPs who had not 
previously demonstrated meaningful use, with a limited exception for 
the Medicaid EHR Incentive Program (80 FR 16739-16740, 16774-16775). We 
received many comments from respondents stating their preference for 
maintaining the 90-day EHR reporting period to allow first time 
participants to avoid payment adjustments. In addition, commenters 
indicated that the 90-day time period reduced administrative burden and 
allowed for needed time to adapt their EHRs to ensure they could 
achieve program objectives. As a result, we did not finalize our 
proposal and established a 90-day EHR reporting period for all EPs in 
2015 and for new participants in 2016, as well as a 90-day EHR 
reporting period for new participants in 2015, 2016, and 2017 with 
regard to the payment adjustments (80 FR 62777-62779; 62904-62906).
    Moving forward, the implementation of MIPS creates a critical 
opportunity to align performance periods to ensure that quality, CPIA, 
resource use, and the advancing care information performance categories 
are all measured and scored based on the same period of time. We 
believe this would lower reporting burden, focus clinician quality 
improvement efforts and align administrative actions so that clinicians 
can use common systems and reporting pathways.
    Under MIPS, we propose to align the performance period for the 
advancing care information performance category to the proposed MIPS 
performance period of one full calendar year. Thus, the performance 
period for the advancing care information performance category would be 
the same as the performance periods for the other performance 
categories as indicated in section II.E.4. We note that there would not 
be a separate 90-day performance period for the advancing care 
information performance category. Under this proposal, MIPS eligible 
clinicians would need to submit data based on performance period 
starting January 1, 2017, and ending December 31, 2017 for the first 
year of MIPS. We recognize that stakeholders may still have concerns 
related to a full year performance period. We note that, as discussed 
in section II.E.4. of this proposed rule, MIPS eligible clinicians that 
only have data for a portion of the year can still submit data, be 
assessed and be scored for the advancing care information performance 
category. Under the proposal, MIPS eligible clinicians would need to 
possess certified EHR technology and report on the objectives and 
measures (without meeting any thresholds) during the calendar year 
performance period to achieve the advancing care information category 
base score. We note that MIPS eligible clinicians would be required to 
submit all of the data they have available for the performance period, 
even if the time period they have data for is less than one full 
calendar year.
    We believe this proposal would reduce reporting burden and 
streamline requirements so that MIPS eligible clinicians and third 
party intermediaries, such as registries and QCDRs, would have a common 
timeline for data submission to all performance categories. We refer 
readers to section II.E.4. of this proposed rule for discussion of the 
performance period for MIPS and solicit feedback on our proposal.
(5) Advancing Care Information Performance Category Data Submission and 
Collection
(a) Definition of Meaningful EHR User and Certification Requirements
    The use of certified health IT continues to be an important 
component of care delivery for clinicians. Certified health IT that 
advances patient engagement, interoperability, and privacy and security 
are key to care coordination, and a critical component in improving 
health outcomes.
    We anticipate that as certified health IT and related standards 
continue to evolve to support health information exchange, care 
coordination (for example, referral management), and other 
capabilities, we will consider updates to the certified health IT 
requirements for MIPS. We continue to work with the Office of the 
National Coordinator for Health IT to identify certified health IT that 
would aid clinicians in MIPS.
    Throughout this proposed rule, we use the terms ``certified health 
IT'' and ``certified EHR technology''. These terms refer to health 
information technologies and systems that are certified to various 
standards and functions under the ONC Health IT Certification Program. 
In general, the full range of potential technologies, functions, 
standards, and systems for which ONC has established certification 
criteria are referred to as ``certified health IT'' (See the 2015 
Edition Health IT Certification Criteria final rule (80 FR 62604)). In 
contrast, the term ``certified EHR technology'' is a statutory and 
regulatory term that defines the technology that MIPS eligible 
clinicians

[[Page 28219]]

and participants in Advanced APMs must use.
    It is important to note that certified EHR technology is a part of 
the larger category of certified health IT. Therefore when discussing 
certified health IT in a broad and general manner; such a discussion 
includes both the functions included in certified EHR technology and 
other additional potential functions and criteria. In other words, 
certified EHR technology is a subset of the broader definition of 
certified health IT.
    ``Certified health IT'' is used in two different ways within this 
proposed rule. The first is stated as ``certified health IT'' to 
identify where the text is referencing a broad range of technology that 
is included in the ONC Health IT Certification Program. The second use 
is where the term ``a certified Health IT Module'' identifies a 
technology or function used independently from the clinicians' EHR. An 
example of this second use of the term includes the certified functions 
leveraged by Health Information Exchange organizations, QCDRs, and 
public health agencies to support actions like information exchange, 
quality measurement, and data submission. These individual functions 
may also be a part of the certified EHR technology definition and may 
connect with the EHR, but are in these cases used independently from 
the clinicians' EHR systems.
    ONC and CMS worked closely to identify the set of certified health 
IT that are part of the certified EHR technology definitions proposed 
in this rule. For example, ONC's 2015 Edition Health Information 
Technology (Health IT) Certification Criteria, 2015 Edition Base 
Electronic Health Record (EHR) Definition, and ONC Health IT 
Certification Program Modifications (80 FR 62602 through 62759) 
hereinafter referred to as ``2015 Edition final rule'', defines the 
technological requirements for health IT systems used by EHR Incentive 
Program participants. In this proposed rule, we are proposing to adopt 
a definition of certified EHR technology at Sec.  414.1305 for MIPS 
eligible clinicians that is based on the definition that applies in the 
EHR Incentive Programs under 42 CFR 495.4.
    In the 2015 EHR Incentive Programs final rule (80 FR 62873) we 
outlined the requirements for EPs using certified EHR technology in 
2017 as it relates to the objectives and measures they select to 
report. We propose at Sec.  414.1375 similar requirements for the use 
of certified EHR technology in relation to the selection of objectives 
and measures under the MIPS advancing care information performance 
category.
    For 2017, the first MIPS performance period, MIPS eligible 
clinicians would be able to use EHR technology certified to either the 
2014 or 2015 Edition certification criteria as follows:
     A MIPS eligible clinician who only has technology 
certified to the 2015 Edition may choose to report: (1) On the 
objectives and measures specified for the advancing care information 
performance category in section II.E.5.g.7 of this proposed rule, which 
correlate to Stage 3 requirements; or (2) on the alternate objectives 
and measures specified for the advancing care information performance 
category in section II.E.5.g.7 of this proposed rule, which correlate 
to modified Stage 2 requirements.
     A MIPS eligible clinician who has technology certified to 
a combination of 2015 Edition and 2014 Edition may choose to report: 
(1) On the objectives and measures specified for the advancing care 
information performance category in section II.E.5.g.7 of this proposed 
rule, which correlate to Stage 3; or (2) on the alternate objectives 
and measures specified for the advancing care information performance 
category as described in section II.E.5.g.7 of this proposed rule, 
which correlate to modified Stage 2, if they have the appropriate mix 
of technologies to support each measure selected.
     A MIPS eligible clinician who only has technology 
certified to the 2014 Edition would not be able to report on any of the 
measures specified for the advancing care information performance 
category described in section II.E.5.g.7 of this proposed rule that 
correlate to a Stage 3 measure that requires the support of technology 
certified to the 2015 Edition. These MIPS eligible clinicians would be 
required to report on the alternate objectives and measures specified 
for the advancing care information performance category as described in 
section II.E.5.g.7. of this proposed rule, which correlate to modified 
Stage 2 objectives and measures.
    Beginning with the performance period in 2018, MIPS eligible 
clinicians:
     Must only use technology certified to the 2015 Edition to 
meet the objectives and measures specified for the advancing care 
information performance category in section II.E.5.g.7. of this 
proposed rule, which correlate to Stage 3.
    We welcome comments on this proposal, which is intended to maintain 
consistency across MIPS, the Medicare EHR Incentive Program and the 
Medicaid EHR Incentive Program.
    Finally, we propose to define at Sec.  414.1305 a meaningful EHR 
user under MIPS as a MIPS eligible clinician who possesses certified 
EHR technology, uses the functionality of certified EHR technology, and 
reports on applicable objectives and measures specified for the 
advancing care information performance category for a performance 
period in the form and manner specified by CMS.
    We invite comments on our proposals.
(b) Method of Data Submission
    Under the Medicare EHR Incentive Program, EPs attest to the 
numerators and denominators for certain objectives and measures, 
through a CMS web portal. For the purpose of reporting advancing care 
information performance category objectives and measures under the 
MIPS, we propose at Sec.  414.1325 to allow for MIPS eligible 
clinicians to submit advancing care information performance category 
data through qualified registry, EHR, QCDR, attestation and CMS Web 
Interface submission methods. Regardless of data submission method, all 
MIPS eligible clinicians must follow the reporting requirements for the 
objectives and measures to meet the requirements of the advancing care 
information performance category.
    We note that under this proposal, 2017 would be the first year that 
EHRs (through the QRDA submission method), QCDRs and qualified 
registries would be able to submit EHR Incentive Program objectives and 
measures (as adopted for the advancing care information performance 
category) to CMS, and the first time this data would be reported 
through the CMS Web Interface. We recognize that some Health IT 
vendors, QCDRs and qualified registries may not be able to conduct this 
type of data submission for the 2017 performance period given that the 
development efforts associated with this data submission capability. 
However, we are including these data submission mechanisms in 2017 to 
support early adopters and to signal our longer-term commitment to 
working with organizations that are agile, effective and can create 
less burdensome data submission mechanisms for MIPS eligible 
clinicians. We believe the proposed data submission methods could 
reduce reporting burden by synchronizing reporting requirements and 
data submission, and systems, allow for greater access and ease in 
submitting data throughout the MIPS program. We note that specific 
details about the form and manner for data submission will be addressed 
by CMS in the future.

[[Page 28220]]

(c) Group Reporting
    Under the Medicare EHR Incentive Program, CMS adopted a reporting 
mechanism for EPs that are part of a group to attest using one common 
form, or batch reporting process. Under that batch reporting process 
CMS assessed the individual performance of the EPs that made up the 
group, not the group as a whole, to determine whether those EPs 
meaningfully used certified EHR technology.
    The structure of the MIPS and our desire to achieve alignment 
across the MIPS performance categories appropriately necessitates the 
ability to assess the performance of MIPS eligible clinicians at the 
group level for all MIPS performance categories. We believe MIPS 
eligible clinicians should be able to submit data as a group, and be 
assessed at the group level, for all of the MIPS performance 
categories, including the advancing care information performance 
category. For this reason, we are proposing a group reporting mechanism 
for individual MIPS eligible clinicians to have their performance 
assessed as a group for all performance categories in section II.E.1.e. 
of this proposed rule, consistent with section 1848(q)(1)(D)(i)(I) & 
(II) of the Act.
    Under this option, we are proposing that performance on advancing 
care information performance category objectives and measures would be 
assessed and reported at the group level, as opposed to the individual 
MIPS eligible clinician level. We note that the data submission 
criteria would be the same when submitted at the group-level as if 
submitted at the individual-level, but the data submitted would be 
aggregated for all MIPS eligible clinicians within the group practice. 
We believe this approach to data submission better reflects the team 
dynamics of groups, and would reduce the overall reporting burden for 
MIPS eligible clinicians that practice in groups, incentivize practice-
wide approaches to data submission, and provide enterprise-level 
continuous improvements strategies for submitting data to the advancing 
care information performance category. Please see section II.E.1.e. of 
this proposed rule for more discussion of how to participate as a group 
under MIPS.
(6) Reporting Requirements & Scoring Methodology
(a) Scoring Method
    Section 1848(q)(5)(E)(i)(IV) of the Act, as added by section 101(c) 
of the MACRA, states that 25 percent of the MIPS CPS shall be based on 
performance for the advancing care information performance category. 
Therefore, we propose at Sec.  414.1375 that performance in the 
advancing care information performance category will comprise 25 
percent of a MIPS eligible clinician's CPS for payment year 2019 and 
each year thereafter. We received many comments in the MIPS and APMs 
RFI from stakeholders regarding the importance of flexible scoring for 
the advancing care information performance category and provisions for 
multiple performance pathways. We agree that this is the best approach 
moving forward with the adoption and use of certified EHR technology as 
it becomes part of a single coordinated program under the MIPS. For the 
reasons described here and previously in this preamble, we are 
proposing a methodology which balances the goals of incentivizing 
participation and reporting while recognizing exceptional performance 
by awarding points through a performance score. In this methodology, we 
are proposing at Sec.  414.1380(b)(4) that the score for the advancing 
care information performance category would be comprised of a score for 
participation and reporting, hereinafter referred to as the ``base 
score,'' and a score for performance at varying levels above the base 
score requirements, hereinafter referred to as the ``performance 
score''.
(b) Base Score
    To earn points toward the base score, a MIPS eligible clinician 
must report the numerator and denominator of certain measures specified 
for the advancing care information performance category (see measure 
specifications in section II.E.5.g.7 of this proposed rule), which are 
based on the measures adopted by the EHR Incentive Programs for Stage 3 
in the 2015 EHR Incentive Programs Final Rule, to account for 50 
percent (out of a total 100 percent) of the advancing care information 
performance category score. For measures that include a percentage-
based threshold for Stage 3 of the EHR Incentive Program, we would not 
require those thresholds to be met for purposes of the advancing care 
information performance category under MIPS, but would instead require 
MIPS eligible clinicians to report the numerator (of at least one) and 
denominator (or a yes/no statement for applicable measures, which would 
be submitted together with data for the other measures) for each 
measure being reported. We note that for any measure requiring a yes/no 
statement, only a yes statement would qualify for credit under the base 
score. Under the proposal, the base score of the advancing care 
information performance category would incorporate the objective and 
measures adopted by the EHR Incentive Programs with an emphasis on 
privacy and security. We are proposing two variations of a scoring 
methodology for the base score, a primary and an alternate proposal, 
which are outlined below. Both proposals would require the MIPS 
eligible clinician to meet the requirement to protect patient health 
information created or maintained by certified EHR technology to earn 
any score within the advancing care information performance category; 
failure to do so would result in a base score of zero, a performance 
score of zero (discussed in section II.E.5.g of this proposed rule), 
and an advancing care information performance category score of zero.
    The primary proposal at section II.E.5.g.6.b.ii. of this proposed 
rule would require a MIPS eligible clinician to report the numerator 
(of at least one) and denominator or yes/no statement (only a yes 
statement would qualify for credit under the base score) for a subset 
of measures adopted by the EHR Incentive Program for EPs in the 2015 
EHR Incentive Programs Final Rule. In an effort to streamline and 
simplify the reporting requirements under the MIPS, and reduce 
reporting burden on MIPS eligible clinicians, two objectives (Clinical 
Decision Support and Computerized Provider Order Entry) and their 
associated measures would not be required for reporting the advancing 
care information performance category. Given the consistently high 
performance on these two objectives in the EHR Incentive Program with 
EPs accomplishing a median score of over 90 percent for the last 3 
years, we believe these objectives and measures are no longer an 
effective measure of EHR performance and use. In addition, we do not 
believe these objectives and associated measures contribute to the 
goals of patient engagement and interoperability, and thus believe 
these objectives can be removed in an effort to reduce reporting burden 
without negatively impacting the goals of the advancing care 
information performance category. We note that the removed objectives 
and associated measures would still be required as part of ONC's 
functionality standards for certified EHR technology, however, MIPS 
eligible clinicians would not be required to report the numerator and 
denominator or yes/no statement for those measures. In the 2015 EHR 
Incentive Programs Final Rule we also established that, for measures 
that were removed, the technology requirements would still be a part of 
the definition of certified EHR

[[Page 28221]]

technology. For example, in that final rule, the Stage 1 Objective to 
Record Demographics was removed, but the technology and standard for 
this function in the EHR were still required (80 FR 62784). This means 
that the MIPS eligible clinician would still be required to have these 
functions as a part of their certified EHR technology.
    The alternate proposal at section II.E.5.g.6.b.iii. of this 
proposed rule would require a MIPS eligible clinician to report the 
numerator (of at least one) and denominator or yes/no statement (only a 
yes statement would qualify for credit under the base score) for all 
objectives and measures adopted for Stage 3 in the 2015 EHR Incentive 
Programs Final Rule to earn the base score portion of the advancing 
care information performance category, which would include reporting a 
yes/no statement for Clinical Decision Support and a numerator and 
denominator for Computerized Provider Order Entry objectives. We 
include these objectives in the alternate proposal as MIPS eligible 
clinicians may feel the continued measurement of these objectives is 
valuable to the continued use of EHR technology as this would maintain 
the previously established objectives under the EHR Incentive Program.
    We believe both proposed approaches to the base score are 
consistent with the statutory requirements and previously established 
certified EHR technology requirements as we transition to MIPS. We also 
believe both approaches, in conjunction with the advancing care 
information performance score, recognize the need for greater 
flexibility in scoring CEHRT use across different clinician types and 
practice settings by allowing MIPS eligible clinicians to focus on the 
objectives and measures most applicable to their practice.
(i) Privacy and Security; Protect Patient Health Information
    In the 2015 EHR Incentive Programs Final Rule (80 FR 62832), we 
finalized the Protect Patient Health Information objective and its 
associated measure for Stage 3, which requires EPs to protect 
electronic protected health information (ePHI) created or maintained by 
the certified EHR technology through the implementation of appropriate 
technical, administrative, and physical safeguards. As privacy and 
security is of paramount importance and applicable across all 
objectives, the Protect Patient Health Information objective and 
measure would be an overarching requirement for the base score under 
both the primary proposal and alternate proposal, and therefore would 
be an overarching requirement for the advancing care information 
performance category. We propose that a MIPS eligible clinician must 
meet this objective and measure in order to earn any score within the 
advancing care information performance category. Failure to do so would 
result in a base score of zero under either the primary proposal or 
alternate proposal outlined below, as well as a performance score of 
zero (discussed in section II.E.5.g. of this proposed rule) and an 
advancing care information performance category score of zero.
(ii) Advancing Care Information Performance Category Base Score Primary 
Proposal
    In the 2015 EHR Incentive Programs Final Rule (80 FR 62829-62871), 
we finalized certain objectives and measures EPs would report to 
demonstrate meaningful use of certified EHR technology for Stage 3. 
Under our proposal for the base score of the advancing care information 
performance category, MIPS eligible clinicians would be required to 
submit the numerator (of at least one) and denominator, or yes/no 
statement as appropriate (only a yes statement would qualify for credit 
under the base score), for each measure within a subset of objectives 
(Electronic Prescribing, Patient Electronic Access to Health 
Information, Care of Coordination Through Patient Engagement, Health 
Information Exchange, and Public Health and Clinical Data Registry 
Reporting) adopted in the 2015 EHR Incentive Programs Final Rule for 
Stage 3 as outlined in Table 6 to account for the base score of 50 
percent of the advancing care information performance category score. 
Successfully submitting a numerator and denominator or yes/no statement 
for each measure of each objective would earn a base score of 50 
percent for the advancing care information performance category. 
Failure to meet the submission criteria (numerator/denominator or yes/
no statement as applicable) and measure specifications (as defined in 
section II.E.5.g.7. of this proposed rule) for any measure in any of 
the objectives would result in a score of zero for the advancing care 
information performance category base score, a performance score of 
zero (discussed in section II.E.5.g. of this proposed rule) and an 
advancing care information performance category score of zero.
    For the Public Health and Clinical Data Registry Reporting 
objective there is no numerator and denominator to measure; rather, the 
measure is a ``yes/no'' statement of whether the MIPS eligible 
clinician has completed the measure, noting that only a yes statement 
would qualify for credit under the base score. Therefore we are 
proposing that MIPS eligible clinicians would include a yes/no 
statement in lieu of the numerator/denominator statement within their 
submission for the advancing care information performance category for 
the Public Health and Clinical Data Registry Reporting objective. We 
further propose that, to earn points in the base score, a MIPS eligible 
clinician would only need to complete submission on the Immunization 
Registry Reporting measure of this objective. Completing any additional 
measures under this objective would earn one additional bonus point in 
the advancing care information performance category score. For further 
information on this proposed objective, we direct readers to section 
II.E.5.g.7. of this proposed rule.

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(iii) Advancing Care Information Performance Category Base Score 
Alternate Proposal
    Under our alternate proposal for the base score of the advancing 
care information performance category, a MIPS eligible clinician would 
be required to submit the numerator (of at least one) and denominator, 
or yes/no statement as appropriate, for each measure, for all 
objectives and measures for Stage 3 in the 2015 EHR Incentives Program 
Final Rule (80 FR 62829-62871) as outlined in Table 7. Successfully 
submitting a numerator and denominator for each measure of each 
objective would earn a base score of 50 percent for the advancing care 
information performance category. Failure to meet the submission 
requirements, or measure specifications for any measure in any of the 
objectives would result in a score of zero for the advancing care 
information performance category base score, a performance score of 
zero (discussed in Section II.E.5.g.), and an advancing care 
information performance category score of zero.
    We propose the same approach in the alternate proposal for the 
Public Health and Clinical Data Registry Reporting objective as for the 
primary proposal outlined above. We direct readers to section 
II.E.5.g.7. for further details on the individual objectives and 
measures.

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(iv) Modified Stage 2 in 2017
    In the 2015 EHR Incentive Programs final rule (80 FR 62772), we 
streamlined reporting for EPs by adopting a single set of objectives 
and measures for EPs regardless of their prior stage of participation. 
This was the first step in synchronizing the objectives and eliminating 
the separate stages of meaningful use in the EHR Incentive Program. In 
doing so, we also sought to provide some flexibility and to allow 
adequate time for EPs to move toward the more advanced use of EHR 
technology. This flexibility included alternate exclusions and 
specifications for EPs scheduled to demonstrate Stage 1 in 2015 and 
2016 (80 FR 62788) and allowed clinicians to select either the Modified 
Stage 2 Objectives or the Stage 3 Objectives in 2017 (80 FR 62772) with 
all EPs moving to the Stage 3 Objectives in 2018. We note that in 
section II.E.5.g. of this proposed rule, we proposed the requirements 
for MIPS eligible clinicians using various editions of certified EHR 
technology in 2017 as it relates to the objectives and measures they 
select to report.
    In connection with that proposal, and in an effort not to unfairly 
burden MIPS eligible clinicians who are still utilizing EHR technology 
certified to the 2014 Edition certification criteria in 2017, we 
propose at Sec.  414.1380(b)(4) modified primary and alternate 
proposals for the base score for those MIPS eligible clinicians 
utilizing EHR technology certified to the 2014 Edition. We note that 
these modified proposals are the same as the primary and alternate 
proposals outlined above in regard to scoring and data submission, but 
vary in the measures required under the Coordination of Care Through 
Patient Engagement and Health Information Exchange objectives as 
demonstrated in Table 8.
    This approach allows MIPS eligible clinicians to continue moving 
toward advanced use of certified EHR technology in 2018, but allows for 
flexibility in the implementation of upgraded technology and in the 
selection of measures for reporting in 2017.
    We invite comments on our proposal.

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(c) Performance Score
    In addition to the base score, which includes submitting each of 
the objectives and measures in order to achieve 50 percent of the 
possible points within the advancing care information performance 
category, we propose to allow multiple paths to achieve a score greater 
than the 50 percentage base score. The performance score is based on 
the priority goals established by CMS to focus on leveraging certified 
EHR technology to support the coordination of care. A MIPS eligible 
clinician would earn additional points above the base score for 
performance in the objectives and measures for Patient Electronic 
Access, Coordination of Care through Patient Engagement, and Health 
Information Exchange. These measures have a focus on patient 
engagement, electronic access and information exchange, which promote 
healthy behaviors by patients and lay the ground work for 
interoperability. These measures also have significant opportunity for 
improvement among eligible clinicians and the industry as a whole based 
on adoption and performance data. We believe this approach for 
achievement above a base score in the advancing care information 
performance category would provide MIPS eligible clinicians a flexible 
and realistic incentive towards the adoption and use of certified EHR 
technology.
    We are proposing at Sec.  414.1380(b)(4) that, for the performance 
score, the eight associated measures under these three objectives would 
each be assigned a total of 10 possible points. For each measure, a 
MIPS eligible clinician may earn up to 10 percent of their performance 
score based on their performance rate for the given measure. For 
example, a performance rate of 95 percent on a given measure would earn 
9.5 percentage points of the performance score for the advancing care 
information performance category. This scoring approach is consistent 
with the performance score approach outlined for other MIPS categories 
in this proposed rule. Table 9 provides an example of the proposed 
performance score methodology.

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    We note that in this methodology, a MIPS eligible clinician has the 
potential to earn a performance score of up to 80 percent, which, in 
combination with the base score would be greater than the total 
possible 100 percent for the advancing care information performance 
category. This methodology allows flexibility for MIPS eligible 
clinicians to focus on measures which are most relevant to their 
practice to achieve the maximum performance category score, while 
deemphasizing concentration in other measures which are not relevant to 
their practice.
    This proposed methodology recognizes the importance of promoting 
health IT adoption and standards and the use of certified EHR 
technology to support quality improvement, interoperability, and 
patient engagement. We invite comments on our proposal.
(d) Overall Advancing Care Information Performance Category Score
    To determine the MIPS eligible clinician's overall advancing care 
information performance category score, we propose to use the sum of 
the base score, performance score, and the potential Public Health and 
Clinical Data Registry Reporting bonus point. We note that if the sum 
of the MIPS eligible profession's base score (50 percent) and 
performance score (out of a possible 80 percent) with the Public Health 
and Clinical Data Registry Reporting bonus point are greater than 100 
percent, we would apply an advancing care information performance 
category score of 100 percent. For example, if the MIPS eligible 
clinician earned the base score of 50 percent, a performance score of 
60 percent and the bonus point for Public Health and Clinical Data 
Registry Reporting for a total of 111 percent, the MIPS eligible 
clinician's overall advancing care information performance category 
score would be 100 percent. The total percentage score (out of 100) for 
the advancing care information performance category would then be 
applied to the 25 points allocated for the advancing care information 
performance category and incorporated into the MIPS CPS, as described 
in section II.E.6. of this proposed rule. Table 10 provides an example 
of the calculation of the advancing care information performance 
category score based on these proposals.

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(e) Scoring Considerations
    Section 1848(q)(5)(E)(ii) of the Act, as added by section 101(c) of 
the MACRA, provides that in any year in which the Secretary estimates 
that the proportion of EPs (as defined in section 1848(o)(5) of the 
Act) who are meaningful EHR users (as determined under section 
1848(o)(2) of the Act) is 75 percent or greater, the Secretary may 
reduce the applicable percentage weight of the advancing care 
information performance category in the MIPS CPS, but not below 15 
percent, and increase the weightings of the other performance 
categories such that the total percentage points of the increase equals 
the total percentage points of the reduction. We note section 
1848(o)(5) of the Act defines an EP as a physician, as defined in 
section 1861(r) of the Act. For purposes of applying section 
1848(q)(5)(E)(ii) of the Act, we propose to estimate the proportion of 
physicians as defined in section 1861(r) who are meaningful EHR users 
as those physician MIPS eligible clinicians who earn an advancing care 
information performance category score of at least 75 percent under our 
proposed scoring methodology for the advancing care information 
performance category for a performance period. This would require the 
MIPS eligible clinician to earn the advancing care information base 
score of 50 percent, and an advancing care information performance 
score of at least 25 percent (or 24 percent plus the Public Health and 
Clinical Data Registry Reporting bonus point) for an overall 
performance category score of 75 percent for the advancing care 
information performance category. We are alternatively proposing to 
estimate the proportion of physicians as defined in section 1861(r) who 
are meaningful EHR users as those physician MIPS eligible clinicians 
who earn an advancing care information performance category score of 50 
percent (which would only require the MIPS eligible clinician to earn 
the advancing care information base score) under our proposed scoring 
methodology for the advancing care information performance category for 
a performance period, and we seek comments on both of these proposed 
thresholds.
    We propose to base this estimation on data from the relevant 
performance period, if we have sufficient data available from that 
period. For example, if feasible, we would consider whether to reduce 
the applicable percentage weight of the advancing care information 
performance category in the MIPS CPS for the 2019 MIPS payment year 
based on an estimation using the data from the 2017 performance period. 
We note that in section II.E.5.g.8. of this proposed rule, we have 
proposed to reweight the advancing care information performance 
category to zero for certain hospital-based physicians and other 
physicians. These physicians meet the definition of MIPS eligible 
clinicians, but would not be included in the estimation because the 
advancing care information performance category would be weighted at 
zero for them. We note that any adjustments of the performance category 
weights specified in section 1848(q)(5)(E) of the Act based on this 
policy would be established in future notice and comment rulemaking.
    We invite comments on our proposals.
(7) Advancing Care Information Performance Category Objectives and 
Measures Specifications
(a) MIPS Objectives and Measures Specifications
    We propose the objectives and measures for the advancing care 
information performance category of MIPS as outlined in this section of 
the proposed rule. We note that these objectives and measures have been 
adapted from the Stage 3 objectives and measures as finalized in the 
2015 EHR Incentive Programs Final Rule (80 FR 62829-62871), however, we 
have not proposed to maintain the previously established thresholds for 
MIPS. Any additional changes to the objectives and measures are 
outlined in this section of the proposed rule. For a more detailed 
discussion of the Stage 3 objectives and measures, including 
explanatory material and defined terms, we refer readers to the 2015 
EHR Incentive Programs Final Rule (80 FR 62829-62871).
    Objective: Protect Patient Health Information
    Objective: Protect electronic protected health information (ePHI) 
created or maintained by the certified EHR technology through the 
implementation of appropriate technical, administrative, and physical 
safeguards
    Security Risk Analysis Measure: Conduct or review a security risk 
analysis in accordance with the requirements in 45 CFR 164.308(a)(1), 
including addressing the security (to include encryption) of ePHI data 
created or maintained by certified EHR technology in accordance with 
requirements in 45 CFR164.312(a)(2)(iv) and 45 CFR 164.306(d)(3), and 
implement security updates as necessary and correct identified security 
deficiencies as part of the MIPS eligible clinician's risk management 
process.
    Objective: Electronic Prescribing
    Objective: MIPS eligible clinicians must generate and transmit 
permissible prescriptions electronically.
    ePrescribing Measure: At least one permissible prescription written 
by the MIPS eligible clinician is queried for a drug formulary and 
transmitted electronically using certified EHR technology.

[[Page 28227]]

     Denominator: Number of prescriptions written for drugs 
requiring a prescription in order to be dispensed other than controlled 
substances during the performance period; or number of prescriptions 
written for drugs requiring a prescription in order to be dispensed 
during the performance period.
     Numerator: The number of prescriptions in the denominator 
generated, queried for a drug formulary, and transmitted electronically 
using certified EHR technology.
    For this objective, we note that the 2015 EHR Incentive Program 
final rule included a discussion of controlled substances in the 
context of the Stage 3 objective and measure (80 FR 62834), which we 
understand from stakeholders has caused confusion. We are therefore 
proposing for both MIPS and for the EHR Incentive Programs that health 
care providers would continue to have the option to include or not 
include controlled substances that can be electronically prescribed in 
the denominator. This means that health care providers may choose to 
include controlled substances in the definition of ``permissible 
prescriptions'' at their discretion where feasible and allowable by law 
in the jurisdiction where they provide care. The health care provider 
may also choose not to include controlled substances in the definition 
of ``permissible prescriptions'' even if such electronic prescriptions 
are feasible and allowable by law in the jurisdiction where they 
provide care.
    Objective: Clinical Decision Support (Alternate Proposal Only)
    Objective: Implement clinical decision support (CDS) interventions 
focused on improving performance on high-priority health conditions
    Clinical Decision Support (CDS) Interventions Measure: Implement 
three clinical decision support interventions related to three CQMs at 
a relevant point in patient care for the entire performance period. 
Absent three CQMs related to a MIPS eligible clinician's scope of 
practice or patient population, the clinical decision support 
interventions must be related to high-priority health conditions.
    Drug Interaction and Drug-Allergy Checks Measure: The MIPS eligible 
clinician has enabled and implemented the functionality for drug-drug 
and drug-allergy interaction checks for the entire performance period.
    Objective: Computerized Provider Order Entry (Alternate Proposal 
Only)
    Objective: Use computerized provider order entry (CPOE) for 
medication, laboratory, and diagnostic imaging orders directly entered 
by any licensed healthcare professional, credentialed medical 
assistant, or a medical staff member credentialed to and performing the 
equivalent duties of a credentialed medical assistant, who can enter 
orders into the medical record per state, local, and professional 
guidelines.
    Medication Orders Measure: At least one medication order created by 
the MIPS eligible clinician during the performance period is recorded 
using CPOE.
     Denominator: Number of medication orders created by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Laboratory Orders Measure: At least one laboratory order created by 
the MIPS eligible clinician during the performance period is recorded 
using CPOE.
     Denominator: Number of laboratory orders created by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Diagnostic Imaging Orders Measure: At least one diagnostic imaging 
order created by the MIPS eligible clinician during the performance 
period is recorded using CPOE.
     Denominator: Number of diagnostic imaging orders created 
by the MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Objective: Patient Electronic Access.
    Objective: The MIPS eligible clinician provides patients (or 
patient authorized representative) with timely electronic access to 
their health information and patient-specific education.
    Patient Access Measure: For at least one unique patient seen by the 
MIPS eligible clinician: (1) The patient (or the patient authorized 
representative) is provided timely access to view online, download, and 
transmit his or her health information; and (2) The MIPS eligible 
clinician ensures the patient's health information is available for the 
patient (or patient--authorized representative) to access using any 
application of their choice that is configured to meet the technical 
specifications of the Application Programing Interface (API) in the 
MIPS eligible clinician's certified EHR technology.
     Denominator: The number of unique patients seen by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of patients in the denominator (or 
patient authorized representative) who are provided timely access to 
health information to view online, download, and transmit to a third 
party and to access using an application of their choice that is 
configured meet the technical specifications of the API in the MIPS 
eligible clinician's certified EHR technology.
    Patient-Specific Education Measure: The MIPS eligible clinician 
must use clinically relevant information from certified EHR technology 
to identify patient-specific educational resources and provide 
electronic access to those materials to at least one unique patient 
seen by the MIPS eligible clinician.
     Denominator: The number of unique patients seen by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of patients in the denominator who 
were provided electronic access to patient-specific educational 
resources using clinically relevant information identified from 
certified EHR technology during the performance period.
    Objective: Coordination of Care Through Patient Engagement.
    Objective: Use certified EHR technology to engage with patients or 
their authorized representatives about the patient's care.
    View, Download, Transmit (VDT) Measure: During the performance 
period, at least one unique patient (or patient-authorized 
representatives) seen by the MIPS eligible clinician actively engages 
with the EHR made accessible by the MIPS eligible clinician. An MIPS 
eligible clinician may meet the measure by either--(1) view, download 
or transmit to a third party their health information; or (2) access 
their health information through the use of an API that can be used by 
applications chosen by the patient and configured to the API in the 
MIPS eligible clinician's certified EHR technology; or (3) a 
combination of (1) and (2).
     Denominator: Number of unique patients seen by the MIPS 
eligible clinician during the performance period.
     Numerator: The number of unique patients (or their 
authorized representatives) in the denominator who have viewed online, 
downloaded, or transmitted to a third party the patient's health 
information during the performance period and the number of unique 
patients (or their authorized representatives) in the denominator who 
have accessed their health information through the use of an API during 
the performance period.
    Secure Messaging Measure: For at least one unique patient seen by 
the MIPS eligible clinician during the

[[Page 28228]]

performance period, a secure message was sent using the electronic 
messaging function of certified EHR technology to the patient (or the 
patient-authorized representative), or in response to a secure message 
sent by the patient (or the patient-authorized representative).
     Denominator: Number of unique patients seen by the MIPS 
eligible clinician during the performance period.
     Numerator: The number of patients in the denominator for 
whom a secure electronic message is sent to the patient (or patient-
authorized representative) or in response to a secure message sent by 
the patient (or patient-authorized representative), during the 
performance period.
    Patient-Generated Health Data Measure: Patient-generated health 
data or data from a non-clinical setting is incorporated into the 
certified EHR technology for at least one unique patient seen by the 
MIPS eligible clinician during the performance period.
     Denominator: Number of unique patients seen by the MIPS 
eligible clinician during the performance period.
     Numerator: The number of patients in the denominator for 
whom data from non-clinical settings, which may include patient-
generated health data, is captured through the certified EHR technology 
into the patient record during the performance period.
    Objective: Health Information Exchange.
    Objective: The MIPS eligible clinician provides a summary of care 
record when transitioning or referring their patient to another setting 
of care, receives or retrieves a summary of care record upon the 
receipt of a transition or referral or upon the first patient encounter 
with a new patient, and incorporates summary of care information from 
other health care providers into their EHR using the functions of 
certified EHR technology.
    Patient Care Record Exchange Measure: For at least one transition 
of care or referral, the MIPS eligible clinician that transitions or 
refers their patient to another setting of care or health care 
provider--(1) creates a summary of care record using certified EHR 
technology; and (2) electronically exchanges the summary of care 
record.
     Denominator: Number of transitions of care and referrals 
during the performance period for which the MIPS eligible clinician was 
the transferring or referring clinician.
     Numerator: The number of transitions of care and referrals 
in the denominator where a summary of care record was created using 
certified EHR technology and exchanged electronically.
    Request/Accept Patient Care Record Measure: For at least one 
transition of care or referral received or patient encounter in which 
the MIPS eligible clinician has never before encountered the patient, 
the MIPS eligible clinician receives or retrieves and incorporates into 
the patient's record an electronic summary of care document.
     Denominator: Number of patient encounters during the 
performance period for which a MIPS eligible clinician was the 
receiving party of a transition or referral or has never before 
encountered the patient and for which an electronic summary of care 
record is available.
     Numerator: Number of patient encounters in the denominator 
where an electronic summary of care record received is incorporated by 
the clinician into the certified EHR technology.
    Clinical Information Reconciliation Measure: For at least one 
transition of care or referral received or patient encounter in which 
the MIPS eligible clinician has never before encountered the patient, 
the MIPS eligible clinician performs clinical information 
reconciliation. The clinician must implement clinical information 
reconciliation for the following three clinical information sets: (1) 
Medication. Review of the patient's medication, including the name, 
dosage, frequency, and route of each medication. (2) Medication 
allergy. Review of the patient's known medication allergies. (3) 
Current Problem list. Review of the patient's current and active 
diagnoses.
     Denominator: Number of transitions of care or referrals 
during the performance period for which the MIPS eligible clinician was 
the recipient of the transition or referral or has never before 
encountered the patient.
     Numerator: The number of transitions of care or referrals 
in the denominator where the following three clinical information 
reconciliations were performed: Medication list, medication allergy 
list, and current problem list.
    Objective: Public Health and Clinical Data Registry Reporting
    Objective: The MIPS eligible clinician is in active engagement with 
a public health agency or clinical data registry to submit electronic 
public health data in a meaningful way using certified EHR technology, 
except where prohibited, and in accordance with applicable law and 
practice.
    Immunization Registry Reporting Measure: The MIPS eligible 
clinician is in active engagement with a public health agency to submit 
immunization data and receive immunization forecasts and histories from 
the public health immunization registry/immunization information system 
(IIS).
    (Optional) Syndromic Surveillance Reporting Measure: The MIPS 
eligible clinician is in active engagement with a public health agency 
to submit syndromic surveillance data from a non-urgent care ambulatory 
setting where the jurisdiction accepts syndromic data from such 
settings and the standards are clearly defined.
    (Optional) Electronic Case Reporting Measure: The MIPS eligible 
clinician is in active engagement with a public health agency to 
electronically submit case reporting of reportable conditions.
    (Optional) Public Health Registry Reporting Measure: The MIPS 
eligible clinician is in active engagement with a public health agency 
to submit data to public health registries.
    (Optional) Clinical Data Registry Reporting Measure: The MIPS 
eligible clinician is in active engagement to submit data to a clinical 
data registry.
(b) Modified Stage 2 Advancing Care Information Objectives and Measures 
Specifications for MIPS
    We propose the Modified Stage 2 objectives and measures for the 
advancing care information performance category of MIPS as outlined in 
this section of the proposed rule. We note that these objectives and 
measures have been adapted from the Modified Stage 2 objectives and 
measures as finalized in the 2015 EHR Incentive Programs Final Rule (80 
FR 62793--62825), however, we have not proposed to maintain the 
previously established thresholds for MIPS. Any additional changes to 
the objectives and measures are outlined in this section of the 
proposed rule. For a more detailed discussion of the Modified Stage 2 
objectives and measures, including explanatory material and defined 
terms, we refer readers to the 2015 EHR Incentive Programs Final Rule 
(80 FR 62793--62825).
    Objective: Protect Patient Health Information
    Objective: Protect electronic protected health information (ePHI) 
created or maintained by the certified EHR technology through the 
implementation of appropriate technical, administrative, and physical 
safeguards.
    Security Risk Analysis Measure: Conduct or review a security risk 
analysis in accordance with the requirements in 45 CFR 164.308(a)(1), 
including addressing the security (to include encryption) of ePHI data 
created

[[Page 28229]]

or maintained by certified EHR technology in accordance with 
requirements in 45 CFR164.312(a)(2)(iv) and 45 CFR 164.306(d)(3), and 
implement security updates as necessary and correct identified security 
deficiencies as part of the MIPS eligible clinician's risk management 
process.
    Objective: Electronic Prescribing
    Objective: MIPS eligible clinicians must generate and transmit 
permissible prescriptions electronically.
    ePrescribing Measure: At least one permissible prescription written 
by the MIPS eligible clinician is queried for a drug formulary and 
transmitted electronically using certified EHR technology.
     Denominator: Number of prescriptions written for drugs 
requiring a prescription in order to be dispensed other than controlled 
substances during the performance period; or number of prescriptions 
written for drugs requiring a prescription in order to be dispensed 
during the performance period.
     Numerator: The number of prescriptions in the denominator 
generated, queried for a drug formulary, and transmitted electronically 
using certified EHR technology.
    Objective: Clinical Decision Support (alternate proposal only)
    Objective: Implement clinical decision support (CDS) interventions 
focused on improving performance on high-priority health conditions.
    Clinical Decision Support (CDS) Interventions Measure: Implement 
three clinical decision support interventions related to three CQMs at 
a relevant point in patient care for the entire performance period. 
Absent three CQMs related to a MIPS eligible clinician's scope of 
practice or patient population, the clinical decision support 
interventions must be related to high-priority health conditions.
    Drug Interaction and Drug-Allergy Checks Measure: The MIPS eligible 
clinician has enabled and implemented the functionality for drug-drug 
and drug-allergy interaction checks for the entire performance period.
    Objective: Computerized Provider Order Entry
    Objective: Use computerized provider order entry (CPOE) for 
medication, laboratory, and diagnostic imaging orders directly entered 
by any licensed healthcare professional, credentialed medical 
assistant, or a medical staff member credentialed to and performing the 
equivalent duties of a credentialed medical assistant, who can enter 
orders into the medical record per state, local, and professional 
guidelines.
    Medication Orders Measure: At least one medication order created by 
the MIPS eligible clinician during the performance period is recorded 
using CPOE.
     Denominator: Number of medication orders created by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Laboratory Orders Measure: At least one laboratory order created by 
the MIPS eligible clinician during the performance period is recorded 
using CPOE.
     Denominator: Number of laboratory orders created by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Diagnostic Imaging Orders Measure: At least one diagnostic imaging 
order created by the MIPS eligible clinician during the performance 
period is recorded using CPOE.
     Denominator: Number of diagnostic imaging orders created 
by the MIPS eligible clinician during the performance period.
     Numerator: The number of orders in the denominator 
recorded using CPOE.
    Objective: Patient Electronic Access
    Objective: The MIPS eligible clinician provides patients (or 
patient authorized representative) with timely electronic access to 
their health information and patient-specific education.
    Patient Access Measure: At least one patient seen by the MIPS 
eligible clinician during the performance period is provided timely 
access to view online, download, and transmit to a third party their 
health information subject to the MIPS eligible clinician's discretion 
to withhold certain information.
     Denominator: The number of unique patients seen by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of patients in the denominator (or 
patient authorized representative) who are provided timely access to 
health information to view online, download, and transmit to a third 
party.
    View, Download, Transmit (VDT) Measure: At least one patient seen 
by the MIPS eligible clinician during the performance period (or 
patient-authorized representative) views, downloads or transmits their 
health information to a third party during the performance period.
     Denominator: Number of unique patients seen by the MIPS 
eligible clinician during the performance period.
     Numerator: The number of unique patients (or their 
authorized representatives) in the denominator who have viewed online, 
downloaded, or transmitted to a third party the patient's health 
information during the performance period.
    Objective: Patient-Specific Education
    Objective: The MIPS eligible clinician provides patients (or 
patient authorized representative) with timely electronic access to 
their health information and patient-specific education.
    Patient-Specific Education Measure: The MIPS eligible clinician 
must use clinically relevant information from certified EHR technology 
to identify patient-specific educational resources and provide access 
to those materials to at least one unique patient seen by the MIPS 
eligible clinician.
     Denominator: The number of unique patients seen by the 
MIPS eligible clinician during the performance period.
     Numerator: The number of patients in the denominator who 
were provided access to patient-specific educational resources using 
clinically relevant information identified from certified EHR 
technology during the performance period.
    Objective: Secure Messaging
    Objective: Use certified EHR technology to engage with patients or 
their authorized representatives about the patient's care.
    Secure Messaging Measure: For at least one patient seen by the MIPS 
eligible clinician during the performance period, a secure message was 
sent using the electronic messaging function of certified EHR 
technology to the patient (or the patient-authorized representative), 
or in response to a secure message sent by the patient (or the patient 
authorized representative) during the performance period.
     Denominator: Number of unique patients seen by the MIPS 
eligible clinician during the performance period.
     Numerator: The number of patients in the denominator for 
whom a secure electronic message is sent to the patient (or patient-
authorized representative) or in response to a secure message sent by 
the patient (or patient-authorized representative), during the 
performance period.
    Objective: Health Information Exchange
    Objective: The MIPS eligible clinician provides a summary of care 
record when transitioning or referring their patient to another setting 
of care, receives or retrieves a summary of care record upon the 
receipt of a transition or referral or upon the first patient encounter 
with a new patient, and incorporates summary of care

[[Page 28230]]

information from other health care providers into their EHR using the 
functions of certified EHR technology.
    Health Information Exchange Measure: The MIPS eligible clinician 
that transitions or refers their patient to another setting of care or 
health care provider (1) uses certified EHR technology to create a 
summary of care record; and (2) electronically transmits such summary 
to a receiving health care provider for at least one transition of care 
or referral.
     Denominator: Number of transitions of care and referrals 
during the performance period for which the EP was the transferring or 
referring health care provider.
     Numerator: The number of transitions of care and referrals 
in the denominator where a summary of care record was created using 
certified EHR technology and exchanged electronically.
    Objective: Medication Reconciliation
    Medication Reconciliation Measure: The MIPS eligible clinician 
performs medication reconciliation for at least one transition of care 
in which the patient is transitioned into the care of the MIPS eligible 
clinician.
     Denominator: Number of transitions of care or referrals 
during the performance period for which the MIPS eligible clinician was 
the recipient of the transition or referral or has never before 
encountered the patient.
     Numerator: The number of transitions of care or referrals 
in the denominator where the following three clinical information 
reconciliations were performed: Medication list, medication allergy 
list, and current problem list.
    Objective: Public Health Reporting
    Objective: The MIPS eligible clinician is in active engagement with 
a public health agency or clinical data registry to submit electronic 
public health data in a meaningful way using certified EHR technology, 
except where prohibited, and in accordance with applicable law and 
practice.
    Immunization Registry Reporting Measure: The MIPS eligible 
clinician is in active engagement with a public health agency to submit 
immunization data.
    Syndromic Surveillance Registry Reporting Measure: The MIPS 
eligible clinician is in active engagement with a public health agency 
to submit syndromic surveillance data.
    Specialized Registry Reporting Measure: The MIPS eligible clinician 
is in active engagement to submit data to a specialized registry.
    We invite comments on our proposal.
(c) Exclusions
    In the 2015 EHR Incentive Programs Final Rule (80 FR 62829-62871) 
we outlined certain exclusions from the objectives and measures of 
meaningful use for EPs who perform low numbers of a particular action 
or activity for a given measure (for example, an EP who writes fewer 
than 100 permissible prescriptions during the EHR reporting period 
would be granted an exclusion for the Electronic Prescribing measure) 
or for EPs who had no office visits during the EHR reporting period. 
Moving forward, we believe that the proposed MIPS exclusion criteria as 
outlined in section II.E.3. of this proposed rule, and advancing care 
information performance category scoring methodology together 
accomplish the same end as the previously established exclusions for 
the majority of the advancing care information measures. By excluding 
from MIPS those clinicians who do not exceed the low-volume threshold 
(proposed in section II.E.3.c. as MIPS eligible clinicians who, during 
the performance period, have Medicare billing charges less than or 
equal to $10,000 and provide care for 100 or fewer Part B-enrolled 
Medicare beneficiaries), we believe exclusions for most of the 
individual advancing care information measures are no longer necessary. 
The additional flexibility afforded by the proposed advancing care 
information performance category scoring methodology eliminates 
required thresholds for measures and allows MIPS eligible clinicians to 
focus on, and therefore report higher numbers for, measures that are 
more relevant to their practice.
    We note that EPs who write less than 100 permissible prescriptions 
during the EHR reporting period are allowed an exclusion for the 
Electronic Prescribing measure under the EHR Incentive Program (80 FR 
62834), which we do not propose for MIPS. We note that the Electronic 
Prescribing objective would not be part of the performance score under 
our proposals, and thus MIPS eligible clinicians who write very low 
numbers of permissible prescriptions would not be at a disadvantage in 
relation to other MIPS eligible clinicians when seeking to achieve a 
maximum advancing care information performance category score. For the 
purposes of the base score, we are proposing that those MIPS eligible 
clinicians who write fewer than 100 permissible prescriptions in a 
performance period may elect to report their numerator and denominator 
(if they have at least one permissible prescription for the numerator), 
or they may report a null value. This is consistent with prior policy 
which allowed flexibility for clinicians in similar circumstances to 
choose an alternate exclusion (80 FR 62789).
    In addition, in the 2015 EHR Incentive Programs final rule, we 
adopted a set of exclusions for the Immunization Registry Reporting 
measure under the Public Health and Clinical Data Registry Reporting 
objective (80 FR 62870). We recognize that some types of clinicians do 
not administer immunizations, and are therefore proposing to maintain 
the previously established exclusions for the Immunization Registry 
Reporting measure. We are therefore proposing that these MIPS eligible 
clinicians may elect to report their yes/no statement if applicable, or 
they may report a null value (if the previously established exclusions 
apply) for purposes of reporting the base score.
    We note that we are not proposing to maintain any of the other 
exclusions established under the EHR Incentive Program, however, we are 
seeking comment on whether other exclusions should be considered under 
the advancing care information performance category under the MIPS.
(8) Additional Considerations
(a) Reweighting of the Advancing Care Information Performance Category 
for MIPS Eligible Clinicians Without Sufficient Measures Applicable and 
Available
    As discussed previously in this proposed rule, section 101(b)(1)(A) 
of the MACRA amended section 1848(a)(7)(A) of the Act to sunset the 
meaningful use payment adjustment at the end of CY 2018. Section 
1848(a)(7) of the Act includes certain statutory exceptions to the 
meaningful use payment adjustment under section 1848(a)(7)(A) of the 
Act. Specifically, section 1848(a)(7)(D) of the Act exempts hospital-
based EPs from the application of the payment adjustment under section 
1848(a)(7)(A) of the Act. In addition, section 1848(a)(7)(B) of the Act 
provides that the Secretary may exempt an EP who is not a meaningful 
EHR user for the EHR reporting period for the year from the application 
of the payment adjustment under section 1848(a)(7)(A) of the Act if the 
Secretary determines that compliance with the requirements for being a 
meaningful EHR user would result in a significant hardship, such as in 
the case of an EP who practices in a rural area without sufficient 
internet access. The MACRA did not maintain these statutory

[[Page 28231]]

exceptions for the advancing care information performance category of 
the MIPS. Thus, the exceptions under sections 1848(a)(7)(B) and (D) of 
the Act are limited to the meaningful use payment adjustment under 
section 1848(a)(7)(A) of the Act and do not apply in the context of the 
MIPS.
    Section 1848(q)(5)(F) of the Act provides, if there are not 
sufficient measures and activities applicable and available to each 
type of MIPS eligible clinician, the Secretary shall assign different 
scoring weights (including a weight of zero) for each performance 
category based on the extent to which the category is applicable to 
each type of MIPS eligible clinician, and for each measure and activity 
specified for each such category based on the extent to which the 
measure or activity is applicable and available to the type of MIPS 
eligible clinician.
    We believe that under our proposals for the advancing care 
information performance category of the MIPS, there may not be 
sufficient measures that are applicable and available to certain types 
of MIPS eligible clinicians as outlined in this section of this 
proposed rule, some of whom may have qualified for a statutory 
exception to the meaningful use payment adjustment under section 
1848(a)(7)(A) of the Act. For the reasons stated below, we propose to 
assign a weight of zero to the advancing care information performance 
category for purposes of calculating a MIPS CPS for these MIPS eligible 
clinicians. We refer readers to section II.E.6. of this proposed rule 
for more information regarding how the quality, resource use and CPIA 
performance categories would be reweighted.
(i) Hospital-Based MIPS Eligible Clinicians
    Section 1848(a)(7)(D) of the Act exempts hospital-based EPs from 
the application of the meaningful use payment adjustment under section 
1848(a)(7)(A) of the Act. We defined a hospital-based EP for the EHR 
Incentive Program under Sec.  495.4 as an EP who furnishes 90 percent 
or more of his or her covered professional services in sites of service 
identified by the codes used in the HIPAA standard transaction as an 
inpatient hospital or emergency room setting in the year preceding the 
payment year, or in the case of a payment adjustment year, in either of 
the 2 years before the year preceding such payment adjustment year. 
Under this definition, EPs that have 90 percent or more of payments for 
covered professional services associated with claims with Place of 
Service Codes 21 (inpatient hospital) or 23 (emergency department) are 
considered hospital-based (75 FR 44442).
    We believe there may not be sufficient measures applicable and 
available to hospital-based MIPS eligible clinicians under our 
proposals for the advancing care information performance category of 
MIPS.
    Hospital-based MIPS eligible clinicians may not have control over 
the decisions that the hospital makes regarding the use of health IT 
and certified EHR technology. These MIPS eligible clinicians therefore 
may have no control over the type of certified EHR technology 
available, the way that the technology is implemented and used, or 
whether the hospital continually invests in the technology to ensure it 
is compliant with ONC certification criteria. In addition, some of the 
specific advancing care information performance category measures, such 
as the Patient Access measure under the Patient Electronic Access 
objective requires that patients have access to view, download and 
transmit their health information from the EHR which is made available 
by the health care provider, in this case the hospital. Thus the 
measure is more attributable and applicable to the hospital and not to 
the MIPS eligible clinician, as the hospital controls the availability 
of the EHR technology. Further, the requirement under the Protect 
Patient Health Information objective to conduct a security risk 
analysis, would rely on the actions of the hospital, rather than the 
actions of the MIPS eligible clinician, as the hospital controls the 
access and availability and secure implementation of the EHR 
technology. In this case, the measure is again more attributable and 
applicable to the hospital than to the MIPS eligible clinician. 
Further, certain specialists (such as pathologists, radiologists and 
anesthesiologists) who often practice in a hospital setting and may be 
hospital-based MIPS eligible clinicians often lack face-to-face 
interaction with patients, and thus may not have sufficient measures 
applicable and available to them under our proposals. For example, 
hospital-based MIPS eligible clinicians who lack face-to-face patient 
interaction may not have patients for which they could transfer or 
create an electronic summary of care record.
    In addition, we note that eligible hospitals and CAHs are subject 
to meaningful use requirements under sections 1886(b)(3)(B) and (n) and 
1814(l) of the Act, respectively, which were not affected by the 
enactment of the MACRA. Eligible hospitals and CAHs are required to 
report on objectives and measures of meaningful use under the EHR 
Incentive Program, as outlined in the 2015 EHR Incentive Programs Final 
Rule. We note the objectives and measures of the EHR Incentive Programs 
for eligible hospitals and CAHs are specific to these facilities, and 
are more applicable and better represent the EHR technology available 
in these settings.
    For these reasons, we propose to rely on section 1848(q)(5)(F) of 
the Act to assign a weight of zero to the advancing care information 
performance category for hospital-based MIPS eligible clinicians. We 
propose to define a ``hospital-based MIPS eligible clinician'' at Sec.  
414.1305 as a MIPS eligible clinician who furnishes 90 percent or more 
of his or her covered professional services in sites of service 
identified by the codes used in the HIPAA standard transaction as an 
inpatient hospital or emergency room setting in the year preceding the 
performance period, otherwise stated as the year three years preceding 
the MIPS payment year. For example, under this proposal, hospital-based 
determinations would be made for the 2019 MIPS payment year based on 
covered professional services furnished in 2016. We also propose, 
consistent with the EHR Incentive Program, that CMS would determine 
which MIPS eligible clinicians qualify as ``hospital-based'' for a MIPS 
payment year. We invite comments on these proposals.
    In addition, we are seeking comment on how the advancing care 
information performance category could be applied to hospital-based 
MIPS eligible clinicians in future years of MIPS, and the types of 
measures that would be applicable and available to these types of MIPS 
eligible clinicians.
    We are also seeking comment on whether the previously established 
90 percent threshold of payments for covered professional services 
associated with claims with Place of Service (POS) Codes 21 (inpatient 
hospital) or 23 (emergency department) is appropriate, or whether we 
should consider lowering this threshold to account for hospital-based 
MIPS eligible clinicians who bill more than 10 percent of claims with a 
POS other than 21 or 23. Although we have proposed a threshold of 90 
percent, we are considering whether a lower threshold would be more 
appropriate for hospital-based MIPS eligible clinicians. In particular, 
we are interested in what factors should be applied to determine the 
threshold for hospital-based MIPS eligible clinicians. We will continue 
to evaluate the data to determine whether there are certain thresholds 
which naturally define a hospital-based MIPS eligible clinician.

[[Page 28232]]

(ii) MIPS Eligible Clinicians Facing a Significant Hardship
    Section 1848(a)(7)(B) of the Act provides that the Secretary may 
exempt an EP who is not a meaningful EHR user for the EHR reporting 
period for the year from the application of the payment adjustment 
under section 1848(a)(7)(A) of the Act if the Secretary determines that 
compliance with the requirements for being a meaningful EHR user would 
result in a significant hardship. In the Stage 2 Final Rule (77 FR 
54097-54100), we defined certain categories of significant hardships 
that may prevent an EP from meeting the requirements of being a 
meaningful EHR user. These categories include:
     Insufficient Internet Connectivity (as specified in 42 CFR 
495.102(d)(4)(i)).
     Extreme and Uncontrollable Circumstances (as specified in 
42 CFR 495.102(d)(4)(iii)).
     Lack of Control over the Availability of certified EHR 
technology (as specified in 42 CFR 495.102(d)(4)(iv)(A)).
     Lack of Face-to-Face Patient Interaction (as specified in 
42 CFR 495.102(d)(4)(iv)(B)).
    We believe that under our proposals for the advancing care 
information performance category, there may not be sufficient measures 
applicable and available to MIPS eligible clinicians within the 
categories above. For these MIPS eligible clinicians, we propose to 
rely on section 1848(q)(5)(F) of the Act to re-weight the advancing 
care information performance category to zero.
    Sufficient internet access is fundamental to many of the measures 
proposed for the advancing care information performance category. For 
example, the ePrescribing measure requires sufficient access to the 
Internet to transmit prescriptions electronically, and the Secure 
Messaging measure requires sufficient Internet access to receive and 
respond to patient messages. These measures may not be applicable to 
MIPS eligible clinicians who practice in areas with insufficient 
internet access. We propose to require MIPS eligible clinicians to 
demonstrate insufficient internet access through an application process 
in order to be considered for a reweighting of the advancing care 
information performance category. The application would have to 
demonstrate that the MIPS eligible clinicians lacked sufficient 
internet access, during the performance period, and that there were 
insurmountable barriers to obtaining such infrastructure, such as a 
high cost of extending the internet infrastructure to their facility.
    Extreme and uncontrollable circumstances, such as a natural 
disaster in which an EHR or practice building are destroyed, can happen 
at any time and are outside a MIPS eligible clinician's control. If a 
MIPS eligible clinician's certified EHR technology is unavailable as a 
result of such circumstances, the measures specified for the advancing 
care information performance category may not be available for the MIPS 
eligible clinician to report. We propose that these MIPS eligible 
clinicians submit an application to include the circumstances by which 
the EHR technology was unavailable, and for what period of time it was 
unavailable, to be considered for reweighting of their advancing care 
information performance category.
    In the Stage 2 Final Rule (77 FR 54100) we discussed EPs who 
practice at multiple locations, and may not have the ability to impact 
their practices' health IT decisions. We noted the case of surgeons 
using ambulatory surgery centers or a physician treating patients in a 
nursing home who does not have any other vested interest in the 
facility, and may have no influence or control over the health IT 
decisions of that facility. If MIPS eligible clinicians lack control 
over the EHR technology in their practice locations, then the measures 
specified for the advancing care information performance category may 
not be available to them for reporting. To be considered for a 
reweighting of the advancing care information performance category, we 
propose that these MIPS eligible clinicians would need to submit an 
application demonstrating that a majority (50 percent or more) of their 
outpatient encounters occur in locations where they have no control 
over the health IT decisions of the facility, and request their 
advancing care information performance category score be reweighted to 
zero. We note that in such cases, the MIPS eligible clinician must have 
no control over the availability of certified EHR technology. Control 
does not imply final decision-making authority. For example, we would 
generally view MIPS eligible clinicians practicing in a large group as 
having control over the availability of certified EHR technology, 
because they can influence the group's purchase of certified EHR 
technology, they may reassign their claims to the group, they may have 
a partnership/ownership stake in the group, or any payment adjustment 
would affect the group's earnings and the entire impact of the 
adjustment would not be borne by the individual MIPS eligible 
clinician. These MIPS eligible clinicians can influence the 
availability of certified EHR technology and the group's earnings are 
directly affected by the payment adjustment. Thus, such MIPS eligible 
clinicians would not, as a general rule, be viewed as lacking control 
over the availability of certified EHR technology and would not be 
eligible for their advancing care information performance category to 
be reweighted based on their membership in a group practice that has 
not adopted certified EHR technology.
    In the Stage 2 Final Rule (77 FR 54099), we noted the challenges 
faced by EPs who lack face-to-face interaction with patients (EPs that 
are non-patient facing), or lack the need to provide follow-up care 
with patients. Many of the measures proposed under the advancing care 
information performance category require face-to-face interaction with 
patients, including all eight of the measures that make up the three 
performance score objectives (Patient Electronic Access, Coordination 
of Care Through Patient Engagement and Health Information Exchange). 
Because these proposed measures rely so heavily on face-to-face patient 
interactions, we do not believe there would be sufficient measures 
applicable to non-patient-facing MIPS eligible clinicians under the 
advancing care information performance category. We propose to 
automatically reweight the advancing care information performance 
category to zero for a MIPS eligible clinician who is classified as a 
non-patient facing MIPS eligible clinician (based on the number of 
patient-facing encounters billed during a performance period) without 
requiring an application to be submitted by the MIPS eligible 
clinician. We refer readers to section II.E.1.b. of this proposed rule 
for further discussion of non-patient facing MIPS eligible clinicians. 
We are seeking comment on how the advancing care information 
performance category could be applied to non-patient facing MIPS 
eligible clinicians in future years of MIPS, and the types of measures 
that would be applicable and available to these types of MIPS eligible 
clinicians.
    We propose that all applications for reweighting the advancing care 
information performance category be submitted by the MIPS eligible 
clinician or designated group representative in the form and manner 
specified by CMS. We propose that all applications may be submitted on 
a rolling basis, but must be received by CMS no later than the close of 
the submission period for the relevant performance period, or a later 
date specified by CMS. For example, for the 2017 performance period, 
applications

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must be submitted no later than March 31, 2018 (or later date as 
specified by CMS) to be considered for reweighting the advancing care 
information performance category for the 2019 MIPS payment year. An 
application would need to be submitted annually to be considered for 
reweighting each year.
    We invite comments on our proposals.
(iii) Nurse Practitioners, Physician Assistants, Clinical Nurse 
Specialists, and Certified Registered Nurse Anesthetists
    The definition of a MIPS EP under section 1848(q)(1)(C) of the Act 
includes certain non-physician practitioners, including Nurse 
Practitioners (NPs), Physicians Assistants (PAs), Certified Registered 
Nurse Anesthetists (CRNAs) and Clinical Nurse Specialists (CNSs)). 
CRNAs and CNSs are not eligible for the incentive payments under 
Medicare or Medicaid for the adoption and meaningful use of certified 
EHR technology (sections 1848(o) and 1903(t) of the Act, respectively) 
or subject to the meaningful use payment adjustment under Medicare 
(section 1848(a)(7)(A) of the Act), and thus they may have little to no 
experience with the adoption or use of certified EHR technology. 
Similarly, NPs and PAs may also lack experience with the adoption or 
use of certified EHR technology, as they are not subject to the payment 
adjustment under section 1848(a)(7)(A) of the Act. We further note that 
only 19,281 NPs and only 1,379 PAs have attested to the Medicaid EHR 
Incentive Program. Nurse practitioners are eligible for the Medicaid 
incentive payments under section 1903(t) of the Act, as are PAs 
practicing in a Federally Qualified Health Center (FQHC) or a rural 
health clinic (RHC) that is led by a PA, if they meet patient volume 
requirements and other eligibility criteria.
    Because many of these non-physician clinicians are not eligible to 
participate in the Medicare and/or Medicaid EHR Incentive Program, we 
have little evidence as to whether there are sufficient measures 
applicable and available to these types of MIPS eligible clinicians 
under our proposals for the advancing care information performance 
category. The low numbers of NPs and PAs who have attested for the 
Medicaid incentive payments may indicate that EHR Incentive Program 
measures required to earn the incentive are not applicable or 
available, and thus would not be applicable or available under the 
advancing care information performance category. For these reasons, we 
propose to rely on section 1848(q)(5)(F) of the Act to assign a weight 
of zero to the advancing care information performance category if there 
are not sufficient measures applicable and available to NPs, PAs, 
CRNAs, and CNSs. We would assign a weight of zero only in the event 
that an NP, PA, CRNA, or CNS does not submit any data for any of the 
measures specified for the advancing care information performance 
category. We encourage all NPs, PAs, CRNAs, and CNSs to report on these 
measures to the extent they are applicable and available, however, we 
understand that some NPs, PAs, CRNAs, and CNSs may choose to accept a 
weight of zero for this performance category if they are unable to 
fully report the advancing care information measures. We believe this 
approach is appropriate for the first MIPS performance period based on 
the payment consequences associated with reporting, the fact that many 
of these types of MIPS eligible clinicians may lack experience with EHR 
use, and our current uncertainty as to whether we have proposed 
sufficient measures that are applicable and available to these types of 
MIPS eligible clinicians. We note that we would use the first MIPS 
performance period to further evaluate the participation of these MIPS 
eligible clinicians in the advancing care information performance 
category and would consider for subsequent years whether the measures 
specified for this category are applicable and available to these MIPS 
eligible clinicians.
    We invite comments on our proposal. We are additionally seeking 
comment on how the advancing care information performance category 
could be applied to NPs, PAs, CRNAs, and CNSs in future years of MIPS, 
and the types of measures that would be applicable and available to 
these types of MIPS eligible clinicians.
(iv) Medicaid
    In the 2015 EHR Incentive Programs Final Rule we adopted an 
alternate method for demonstrating meaningful use for certain Medicaid 
EPs that would be available beginning in 2016, for EPs attesting for an 
EHR reporting period in 2015 (80 FR 62900). Medicaid EPs who previously 
received an incentive payment under the Medicaid EHR Incentive Program, 
but failed to meet the eligibility requirements for the program in 
subsequent years, are permitted to attest using the CMS Registration 
and Attestation system for the purpose of avoiding the Medicare payment 
adjustment (80 FR 62900). However, as discussed previously in this 
proposed rule, section 101(b)(1)(A) of the MACRA amended section 
1848(a)(7)(A) of the Act to sunset the meaningful use payment 
adjustment for Medicare EHR Incentive Program EPs at the end of CY 
2018. This means that after the CY 2018 payment adjustment year, there 
will no longer be a separate Medicare EHR Incentive Program for EPs, 
and therefore Medicaid EPs who may have used this alternate method for 
demonstrating meaningful use cannot potentially be subject to a payment 
adjustment under the Medicare EHR Incentive Program at that time. 
Accordingly, there will no longer be a need for this alternate method 
of demonstrating meaningful use after the CY 2018 payment adjustment 
year.
    Similarly, beginning in 2014, states were required to collect, 
upload and submit attestation data for Medicaid EPs for the purposes of 
demonstrating meaningful use to avoid the Medicare payment adjustment 
(80 FR 62915). This form of reporting will also no longer need to 
continue with the sunset of the meaningful use payment adjustment for 
Medicare EHR Incentive Program EPs at the end of CY 2018. Accordingly, 
we are proposing to amend the reporting requirement described at 42 CFR 
495.316(g) by adding an ending date such that after the CY 2018 payment 
adjustment year states would no longer be required to report on 
meaningful EHR users.
    We note that the Medicaid EHR Incentive Program for EPs was not 
impacted by the MACRA and the requirement under section 1848(q) of the 
Act to establish the MIPS program. In this rule, we do not propose any 
changes to the objectives and measures previously established in 
rulemaking for the Medicaid EHR Incentive Program, and thus EPs 
participating in that program must continue to report on the objectives 
and measures under the guidelines and regulations of that program.
    Accordingly, reporting on the measures specified for the advancing 
care information performance category under MIPS cannot be used as a 
demonstration of meaningful use for the Medicaid EHR Incentive 
Programs. Similarly, a demonstration of meaningful use in the Medicaid 
EHR Incentive Programs cannot be used for purposes of reporting under 
MIPS.
    Therefore, MIPS eligible clinicians who are also participating in 
the Medicaid EHR Incentive Programs must report their data for the 
advancing care information performance category through the submission 
methods established for MIPS in order to earn a score for the advancing 
care information performance category under MIPS and must separately 
demonstrate meaningful use in their state's Medicaid EHR Incentive 
Program in order to earn a

[[Page 28234]]

Medicaid incentive payment. The Medicaid EHR Incentive Program 
continues through payment year 2021, with 2016 being the final year an 
EP can begin receiving incentive payments (Sec.  495.310(a)(1)(iii)). 
We solicit comments on alternative reporting or proxies for EPs who 
provide services to both Medicaid and Medicare patients and are 
eligible for both MIPS and the Medicaid EHR Incentive Payment.
h. APM Scoring Standard for MIPS Eligible Clinicians Participating in 
MIPS APMs
    Under section 1848(q)(1)(C)(ii) of the Act, as added by section 
101(c)(1) of the MACRA and discussed above in section II.E.3.b. of this 
proposed rule, Qualifying APM Participants (QPs) are not MIPS eligible 
clinicians and are thus excluded from MIPS payment adjustments. Partial 
Qualifying APM Participants (Partial QPs) are also not MIPS eligible 
clinicians unless they opt to report and be scored under MIPS. All 
other eligible clinicians participating in APMs are MIPS eligible 
clinicians and subject to MIPS requirements, including reporting 
requirements and payment adjustments. However, most current APMs 
already assess their participants on cost and quality of care and 
require engagement in certain care improvement activities.
    We propose at Sec.  414.1370 to establish a scoring standard for 
MIPS eligible clinicians participating in certain types of APMs in 
order to reduce participant reporting burden by eliminating the need 
for such APM eligible clinicians to submit data for both MIPS and their 
respective APMs. For purposes of this APM scoring standard, we propose 
to consider a participant in an APM to be an entity participating in an 
APM under an agreement with CMS that may either include eligible 
clinicians or be an eligible clinician and that is directly tied to 
beneficiary attribution, quality measurement or cost/utilization 
measurement under the APM. In accordance with section 1848(q)(1)(D)(i) 
of the Act, we propose to assess the performance of a group of MIPS 
eligible clinicians in an APM Entity that participates in certain types 
of APMs based on their collective performance as an APM Entity group, 
as defined at Sec.  414.1305.
    In addition to reducing reporting burden, we seek to ensure that 
eligible clinicians in APM Entity groups are not assessed in multiple 
ways on the same performance activities. For instance, performance on 
the generally applicable resource use measures under MIPS could 
contribute to upward or downward adjustments to payments under MIPS in 
a way that is not aligned with the strategy in an ACO initiative for 
reducing total Medicare costs for a specified population of 
beneficiaries attributed through the unique ACO initiative's 
attribution methodology. Depending on the terms of the particular APM, 
we believe similar misalignments could be common between the MIPS 
quality and resource use performance categories and the evaluation of 
quality and resource use in APMs. We believe requiring eligible 
clinicians in APM Entity groups to submit data, be scored on measures, 
and be subject to payment adjustments that are not aligned between MIPS 
and an APM could potentially undermine the validity of testing or 
performance evaluation under the APM. We also believe imposition of 
these requirements would result in reporting activity that provides 
little or no added value to the assessment of eligible clinicians, and 
could confuse eligible clinicians as to which CMS incentives should 
take priority over others in designing and implementing care 
activities.
    We are proposing to use the APM scoring standard for MIPS eligible 
clinicians in APM Entity groups participating in certain APMs that meet 
the criteria listed below (and are identified as ``MIPS APMs'' on the 
CMS Web site). In this section of the rule, we define the proposed 
criteria for MIPS APMs, the APM scoring standard, the performance 
period for APM Entity groups, the proposed MIPS scoring methodology for 
APM Entity groups, and other information related to the APM scoring 
standard.
(1) Criteria for MIPS APMs
    We propose at Sec.  414.1370 to specify that the APM scoring 
standard under MIPS would only be applicable to certain eligible 
clinicians participating in MIPS APMs, which we propose to define as 
APMs (as defined in section II.F.4. of this preamble) that meet the 
following criteria: (1) APM Entities participate in the APM under an 
agreement with CMS; (2) the APM Entities include one or more MIPS 
eligible clinicians on a Participation List; and (3) the APM bases 
payment incentives on performance (either at the APM Entity or eligible 
clinician level) on cost/utilization and quality measures. We 
understand that under some APMs the APM Entity may enter into 
agreements with clinicians or entities that have supporting or 
ancillary roles to the APM Entity's performance under the APM, but are 
not participating under the APM Entity and therefore are not on a 
Participation List. We would not consider eligible clinicians under 
such arrangements to be participants for purposes of the APM Entity 
group to which the APM scoring standard would apply. We understand that 
this policy would not accommodate certain APMs pursuant to statute or 
our regulations rather than under an agreement with CMS. We seek 
comments on how the APM scoring standard should apply to those APMs as 
well.
    The criteria for the identification of MIPS APMs are independent of 
the criteria for Advanced APM determinations discussed in section 
II.F.3. of this proposed rule, so a MIPS APM may or may not also be an 
Advanced APM. As such, it would be possible that an APM meets all three 
proposed criteria to be a MIPS APM, but does not meet the Advanced APM 
criteria listed in section II.F.4. Conversely, it would be possible, 
that an Advanced APM does not meet the criteria listed above because it 
does not include MIPS eligible clinicians as participants.
    The APM scoring standard would not apply to MIPS eligible 
clinicians involved in APMs that include only facilities as 
participants (such as the Comprehensive Care for Joint Replacement 
Model). APMs that do not base payment on cost/utilization and quality 
measures (such as the Accountable Health Communities Model) would also 
not meet the proposed criteria for the APM scoring standard. Instead, 
MIPS eligible clinicians participating in these APMs would need to meet 
the generally applicable MIPS data submission requirements for the MIPS 
performance period, and their performance would be assessed using the 
generally applicable MIPS standards, either as individual eligible 
clinicians or as a group under MIPS.
    As discussed above, the APM scoring standard described in this 
proposed rule would require MIPS eligible clinicians to report certain 
data under MIPS regardless of whether they ultimately become QPs or 
Partial QPs through their participation in Advanced APMs. Although QPs 
(and Partial QPs who elect not to participate in MIPS) would be 
excluded from MIPS payment adjustments, we believe it is necessary, for 
the operational and administrative reasons discussed in section 
II.F.5.d., to treat these eligible clinicians as MIPS eligible 
clinicians unless and until the QP or Partial QP determination is made. 
We believe the proposed APM scoring standard would help to alleviate 
certain duplicative, unnecessary, or competing data submission 
requirements for MIPS eligible clinicians participating in MIPS

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APMs. However, we are interested in public comments on alternative 
methods that could reduce MIPS data submission requirements to enable 
MIPS eligible clinicians participating in Advanced APMs to maximize 
their focus on the care delivery redesign necessary to succeed within 
the Advanced APM while maintaining the statutory framework that 
excludes only certain eligible clinicians from MIPS, and reducing 
reporting burden on Advanced APM participants.
    We invite public comment on alternative MIPS data submission and 
scoring methods. Specifically, if, during a future performance period, 
we are able to make QP determinations before MIPS reporting must occur, 
we seek to attain the least amount of required MIPS data submission 
while avoiding unnecessary operational complexity.
(2) APM Scoring Standard Performance Period
    We propose that the performance period for MIPS eligible clinicians 
participating in MIPS APMs would match the generally applicable 
performance period for MIPS proposed in section II.E.4 of this 
preamble. We propose this policy would apply to all MIPS eligible 
clinicians participating in MIPS APMs (those that meet the criteria 
specified in section II.E.5.h.1. of this proposed rule) except for a 
new MIPS APM for which the first APM performance period begins after 
the start of the corresponding MIPS performance period. In this 
instance, the participating MIPS eligible clinicians in the new MIPS 
APM would submit data to MIPS in the first MIPS performance period for 
the APM either as individual MIPS eligible clinicians or as a group 
using one of the MIPS data submission mechanisms for all four 
performance categories, and report to CMS using the APM scoring 
standard for subsequent MIPS performance period(s). Additionally, we 
anticipate that there might be MIPS APMs that would not be able to use 
the APM scoring standard (even though they met the criteria for the APM 
scoring standard and were treated as a MIPS APMs in the prior MIPS 
performance period) in their last year of operation because of 
technical or resource issues. For example, a MIPS APM in its final year 
may end earlier than the end of the MIPS performance period (proposed 
to be December 31). CMS might not have continuing resources dedicated 
or available to continue to support the MIPS APM activities under the 
APM scoring standard if the MIPS APM ends during the MIPS performance 
period. Therefore, if we determine it is not feasible for the MIPS 
eligible clinicians participating in the APM Entity to report to MIPS 
using this APM scoring standard in an APM's last year of operation, the 
MIPS eligible clinicians in the MIPS APM would need to submit data to 
MIPS either as individual MIPS eligible clinicians or as a group using 
one of the MIPS data submission mechanisms for the applicable 
performance period. We propose the eligible clinicians in the MIPS APM 
would be made aware of this decision in advance of the relevant MIPS 
performance period.
(3) How the APM Scoring Standard Differs From the Assessment of Groups 
and Individual MIPS Eligible Clinicians Under MIPS
    We believe that establishing an APM scoring standard under MIPS 
would allow APM Entities and their participating eligible clinicians to 
focus on the goals and objectives of the APM to improve quality and 
lower costs of care while avoiding duplicative reporting that would 
occur as a result of having to submit data to MIPS separately. The APM 
scoring standard we propose is similar to group assessment under MIPS 
as described in section II.E.3.d. of this proposed rule, but would 
differ in one or more of the following ways: (1) Depending on the terms 
and conditions of the MIPS APM, an APM Entity could be comprised of a 
sole MIPS eligible clinician (for example, a physician practice with 
only one eligible clinician could be considered an APM Entity); (2) the 
APM Entity could include more than one unique TIN, as long as the MIPS 
eligible clinicians are identified as participants in the APM by their 
unique APM participant identifiers; (3) the composition of the APM 
Entity group could include APM participant identifiers with TIN/NPI 
combinations such that some MIPS eligible clinicians in a TIN are APM 
participants and other MIPS eligible clinicians in that same TIN are 
not APM participants. In contrast, assessment as a group under MIPS 
requires a group to be comprised of at least two MIPS eligible 
clinicians who have assigned their billing rights to a TIN. It also 
requires that all MIPS eligible clinicians in the group to use the same 
TIN.
    In addition to the APM Entity group composition being potentially 
different than that of a group as generally defined under MIPS, we 
propose for the APM scoring standard that we will generate a MIPS CPS 
by aggregating all scores for MIPS eligible clinicians in the APM 
Entity that is participating in the MIPS APM to the level of the APM 
Entity. We believe that aggregating the MIPS performance category 
scores at the level of the APM Entity is more meaningful to, and 
appropriate for, these MIPS eligible clinicians because they have 
elected to participate in an APM and collectively focus on care 
transformation activities to improve the quality of care.
    Further, we propose below that, depending on the type of MIPS APM, 
the weights associated with performance categories may be different 
than the generally applicable weights for MIPS eligible clinicians. The 
weights assigned to the MIPS performance categories under the APM 
scoring standard for MIPS eligible clinicians who are participating in 
a MIPS APM may be different from the performance category weights for 
MIPs eligible clinicians not participating in a MIPS APM for the same 
performance period. For example, we propose below that under the APM 
scoring standard, the weight for the resource use performance category 
will be zero. We also propose that for certain MIPS APMs, the weight 
for the quality performance category will be zero for the 2019 payment 
year. Where the weight for the performance category is zero, neither 
the APM Entity nor the MIPS eligible clinicians in the MIPS APM would 
need to report data in these categories, and we would redistribute the 
weights for the quality and resource use performance categories to the 
CPIA and advancing care information performance categories to maintain 
a CPS of 100 percent.
    In order to implement certain elements of the APM scoring standard, 
we would need to use the Shared Savings Program (section 1899 of the 
Act) and CMS Innovation Center (section 1115A of the Act) authorities 
to waive specific statutory provisions related to MIPS reporting and 
scoring. Section 1899(f) of the Act authorizes waivers of title XVIII 
requirements as may be necessary to carry out the Shared Savings 
Program, and section 1115A(d)(1) of Act authorizes waivers of title 
XVIII requirements as may be necessary solely for purposes of testing 
models under section 1115A of the Act. In each section below in which 
we propose scoring methodologies and waivers to enable the proposed 
approaches, we describe how the use of waivers is necessary under the 
respective waiver authority standards. The underlying purpose of APMs 
is for CMS to pay for care in ways that are unique from fee-for-service 
payment and to test new ways of measuring and assessing performance. If 
the data submission requirements and associated adjustments under MIPS 
are not aligned

[[Page 28236]]

with APM-specific goals and incentives, the participants receive 
conflicting messages from CMS on priorities, which could create 
uncertainty and severely degrade our ability to evaluate the impact of 
any particular APM on the overall cost and quality of care. Therefore, 
we believe that, for reasons stated in this section, certain waivers 
are necessary for testing and operating APMs and for maintaining the 
integrity of our evaluation of those APMs.
    We note that for at least the first performance year, we do not 
anticipate that any APMs not authorized under sections 1115A or 1899 of 
the Act would meet the criteria to be MIPS APMs. In the event that we 
do anticipate other Federal demonstrations will become MIPS APMs, we 
will address MIPS scoring for participating eligible clinicians in 
future rulemaking.
(4) APM Participant Identifier and Participant Database
    To ensure we have accurately captured performance data for all of 
the MIPS eligible clinicians that are participating in an APM, we would 
establish and maintain an APM participant database that will include 
all of the MIPS eligible clinicians who are part of the APM Entity. We 
would establish this database to track participation in all APMs, in 
addition to specifically tracking participation in MIPS APMs and 
Advanced APMs. We propose that each APM Entity be identified in the 
MIPS program by a unique APM Entity identifier. We also propose in 
section II.E.2.b. that the unique APM participant identifier for a MIPS 
eligible clinician would be a combination of four identifiers 
including: (1) APM identifier (established for the APM by CMS; for 
example, XXXXXX); (2) APM Entity identifier (established for the APM by 
CMS; for example, AA00001111); (3) the eligible clinician's billing TIN 
(for example, XXXXXXXXX); and (4) NPI (for example, 1111111111). For 
example, this APM participant identifier for the MIPS eligible 
clinician in this case would be APM XXXXXX, APM Entity AA00001111, TIN-
XXXXXXXXX, NPI-11111111111. The use of the APM participant identifier 
will allow CMS to identify all MIPS eligible clinicians participating 
in an APM Entity, including instances when the MIPS eligible clinicians 
use a billing TIN that is shared with MIPS eligible clinicians who are 
not participating in the APM Entity. We would plan to communicate to 
each APM Entity the MIPS eligible clinicians who are included in the 
APM Entity group in advance of the applicable MIPS data submission 
deadline for the MIPS performance period.
    Under the Shared Savings Program, each ACO is formed by a 
collection of Medicare-enrolled TINs (ACO participants). Pursuant to 
our regulation at 42 CFR 425.118, all Medicare enrolled individuals and 
entities that have reassigned their rights to receive Medicare payment 
to the TIN of the ACO participant must agree to participate in the ACO 
and comply with the requirements of the Shared Savings Program. Because 
all providers and suppliers that bill through the TIN of an ACO 
participant are required to agree to participate in the ACO, all MIPS 
eligible clinicians that bill through the TIN of an ACO participant are 
considered to be participating in the ACO. For purposes of the APM 
scoring standard, the ACO would be the APM Entity. The Shared Savings 
Program has established criteria for determining the list of eligible 
clinicians participating under the ACO, and we would use the same 
criteria for determining the list of MIPS eligible clinicians included 
in the APM Entity group for purposes of the APM scoring standard.
    We recognize that there may be scenarios in which MIPS eligible 
clinicians may change TINs, use more than one TIN for billing Medicare, 
change their APM participation status, and/or change other practice 
affiliations during a performance period. Therefore, we propose that 
only those MIPS eligible clinicians who are listed as participants in 
the APM Entity in a MIPS APM on December 31 (the last day of the 
proposed performance period) would be considered part of the APM Entity 
group for purposes of the APM scoring standard. Consequently, MIPS 
eligible clinicians who are not listed as participants of an APM Entity 
in a MIPS APM at the end of the performance period would need to submit 
data to MIPS through one of the MIPS data submission mechanisms and 
would have their performance assessed either as individual MIPS 
eligible clinicians or as a group for all four performance categories. 
For example, a MIPS eligible clinician who participates in the APM 
Entity on January 1, 2017 and leaves the APM Entity on June 15, 2017 
would need to submit data to MIPS using one of the MIPS data submission 
mechanisms and would have their performance assessed either as 
individual MIPS eligible clinicians or as a group. This approach for 
defining the applicable group of MIPS eligible clinicians is consistent 
with our proposal for identifying eligible clinician groups for 
purposes of QP determinations outlined in section II.F.5.b. of this 
proposed rule; the group of eligible clinicians CMS uses for purposes 
of a QP determination would be the same as that used for the APM 
scoring standard. This would be an annual process for each MIPS 
performance period. We propose to calculate one MIPS CPS for each APM 
Entity group, and that MIPS CPS would be applied to all MIPS eligible 
clinicians in the group. As previously explained in section II.E.7. of 
this proposed rule, the MIPS payment adjustment would be applied at the 
TIN/NPI level for each of the MIPS eligible clinicians in the APM 
Entity group.
(5) MIPS Eligible Clinicians Not Participating in a MIPS APM
    The APM Entity group used for purposes of the APM scoring standard 
would be the same APM Entity group used for QP determinations under 
section II.F.5 of this proposed rule, except in the instances of APMs 
that do not meet the criteria to be MIPS APMs, as discussed in section 
II.E.5.h.(1) of this proposed rule. Examples of APMs that would not 
meet criteria to be MIPS APMs are those that do not have MIPS eligible 
clinicians as participants under the APM, or do not tie payment to 
cost/utilization and quality measures. We propose that the APM scoring 
standard would not apply to MIPS eligible clinicians participating in 
APMs that are not MIPS APMs. MIPS eligible clinicians who participate 
in an APM that is not a MIPS APM, would submit data to MIPS and have 
their performance assessed either as an individual MIPS eligible 
clinician or group as described in section II.E.2. of this proposed 
rule. Some APMs may involve certain types of MIPS eligible clinicians 
that are affiliated with an APM Entity but not included in the APM 
Entity group because they are not participants of the APM Entity. We 
propose that even if the APM meets the criteria to be a MIPS APM, MIPS 
eligible clinicians who are not included in the list of participants 
would not be considered part of the APM Entity group for purposes of 
the APM scoring standard. For instance, MIPS eligible clinicians in the 
Comprehensive Care for Joint Replacement Model might be involved in the 
APM through a business arrangement with the APM Entity (the inpatient 
hospital) but are not directly tied to beneficiary attribution, quality 
measurement, or care improvement activities under the APM. 
Additionally, we propose that if a MIPS eligible clinician participates 
in an APM Entity during the MIPS performance period but is no longer a 
participant in the APM Entity group on the last day of the

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performance period, the MIPS eligible clinician must submit either 
individual or group level data to MIPS. CMS will publish the list of 
MIPS APMs prior to the beginning of the MIPS performance period on the 
CMS Web site.
(6) APM Entity Group Scoring for the MIPS Performance Categories
    As mentioned previously, section 1848(q)(3)(A) of the Act requires 
the Secretary to establish performance standards for the measures and 
activities under the following performance categories: (1) Quality; (2) 
resource use; (3) clinical practice improvement activities; and (4) 
advancing care information. We propose at Sec.  414.1370 to calculate 
one CPS that is applied to the billing TIN/NPI combination of each MIPS 
eligible clinician in the APM Entity group. Therefore, each APM Entity 
group (for example, the MIPS eligible clinicians in a Shared Savings 
Program ACO or an Oncology Care Model practice) would receive a score 
for each of the four performance categories according to the proposals 
described in this section of the proposed rule, and we would calculate 
one CPS for the group. The APM Entity group score would be applied to 
each MIPS eligible clinician in the group, and subsequently used to 
develop the MIPS payment adjustment that is applicable for each MIPS 
eligible clinician in the group. Thus the APM Entity group score and 
the participating MIPS eligible clinician score are the same. For 
example, in the Shared Savings Program, the MIPS eligible clinicians in 
each ACO would be an APM Entity group. That group would receive a 
single CPS that would be applied to each of its participating MIPS 
eligible clinicians. Similarly, in the Oncology Care Model, the MIPS 
eligible clinicians in each oncology practice would be an APM Entity 
group. That group would receive a single CPS that would be applied to 
each of the MIPS eligible clinicians in the group. We note that this 
APM Entity group CPS is not used to evaluate eligible clinicians or the 
APM Entity for purposes of incentives within the APM, shared savings 
payments, or other potential payments under the APM, and we currently 
do not foresee APMs that would use the CPS for purposes of evaluation 
within the APM. Rather the APM Entity group CPS would be used only for 
the purposes of the APM scoring standard under MIPS for the first MIPS 
performance period. As proposed in this rule, all MIPS eligible 
clinicians listed as participating in the APM Entity on the last day of 
the performance period would be part of the APM Entity group and thus 
receive the same CPS. It should be noted that although we propose that 
the APM scoring standard only applies to participants in MIPS APMs, 
MIPS eligible clinicians that participate in an APM (including but not 
limited to a MIPS APM) and submit either individual or group level data 
to MIPS may earn a minimum score of 50 percent of the highest potential 
CPIA performance category score as long as such MIPS eligible 
clinicians are on the list of participants for an APM and are 
identifiable by the APM participant identifier.
    Several commenters on the MIPS and APMs RFI suggested, and we 
generally agree, that MIPS eligible clinicians who collaborate under an 
APM Entity to accomplish the APM's goals should be treated as a group 
under MIPS and receive the same CPS. Furthermore, we want to avoid 
situations in which different MIPS eligible clinicians in the same APM 
Entity group receive different MIPS scores. APM Entities have a goal of 
collective success under the terms of the APM, so having a variety of 
differing MIPS adjustments for eligible clinicians within that 
collective unit would undermine the intent behind the APM to test a 
departure from a purely fee-for-service system based on independent 
clinician activity. Lastly, we believe that measurement of the 
performance for MIPS at the APM Entity level for eligible clinicians 
participating in MIPS APMs will result in more statistically valid 
performance scores for these eligible clinicians because the scores are 
aggregated to represent a larger group of MIPS eligible clinicians.
    We propose, for the first MIPS performance period, a specific 
scoring and reporting approach for the MIPS eligible clinicians 
participating in MIPS APMs, which would include the Shared Savings 
Program, the Next Generation ACO Model, and other APMs that meet the 
criteria proposed above for a MIPS APM. Specifically, we propose that 
APM quality measure data submitted through the CMS Web Interface by 
ACOs participating in the Shared Savings Program and the Next 
Generation ACO Model would be used to evaluate performance for the MIPS 
quality performance category. We believe this is appropriate because 
all MIPS eligible clinicians that use the CMS Web Interface as their 
quality measure submission mechanism, e.g., MIPS eligible clinicians 
that report as a group and MIPS APM eligible clinicians that report as 
an APM Entity group, submit data on the same quality measures. Both the 
Shared Savings Program and the Next Generation ACO Model use additional 
quality measures for the purpose of APM performance assessment, but 
only the measures submitted to the CMS Web Interface would be used to 
evaluate performance for the MIPS quality performance category. 
Therefore, other measures that are required by the APM to assess APM 
quality performance will continue to be used for APM performance 
assessment only and not included in the MIPS quality performance 
category scoring. We also propose that MIPS eligible clinicians 
participating in MIPS APMs that do not use the CMS Web Interface as the 
mechanism for submitting APM quality data would not submit quality 
measure data to MIPS for the MIPS quality performance category until 
the second MIPS performance period (2018). In this section of the rule, 
we describe the APM Entity data submission requirements and propose a 
scoring approach for each of the MIPS performance categories for 
specific MIPS APMs (the Shared Savings Program, Next Generation ACO 
Model, and all other MIPS APMs).
(7) Shared Savings Program--Quality Performance Category Scoring Under 
the APM Scoring Standard
    Beginning with the first MIPS performance period all Shared Savings 
Program ACOs would submit their quality measures to MIPS using the CMS 
Web Interface through the same process that they use to report to the 
Shared Savings Program and be scored as they normally would under 
Shared Savings Program rules. Shared Savings Program ACOs have used the 
CMS Web Interface for submitting their quality measures since the 
program's inception, making this a familiar data submission process. We 
also propose that the Shared Savings Program ACO quality measure data 
that is submitted through the CMS Web Interface will be submitted only 
once but will be used for two purposes. The Shared Savings Program 
quality measure data reported to the CMS Web Interface would be used by 
CMS to calculate the MIPS quality performance category score at the APM 
Entity group (ACO) level. The Shared Savings Program quality 
performance data that is not submitted to the CMS Web Interface, for 
example the CAHPS survey and other claims measures would not be 
included in the MIPS APM quality performance category score. We believe 
this will reduce the reporting burden for Shared Savings Program MIPS 
eligible clinicians by requiring quality measure data to be submitted 
only once and used for both programs. The MIPS quality

[[Page 28238]]

performance category requirements and performance benchmarks for 
quality measures submitted via the CMS Web Interface would be used to 
determine the MIPS quality performance category score at the ACO level 
for the APM Entity group.
    We believe that no waivers are necessary here because the quality 
measures submitted via the CMS Web Interface under the Shared Savings 
Program are also MIPS quality measures and will be scored under MIPS 
performance standards. In the event that Shared Savings Program quality 
measures depart from MIPS measures in the future, we will address such 
changes including whether further waivers are necessary at such a time 
in future rulemaking.
(8) Shared Savings Program--Resource Use Performance Category Scoring 
Under the APM Scoring Standard
    We propose that for the first MIPS performance period, we will not 
assess MIPS eligible clinicians participating in the Shared Savings 
Program (the MIPS APM) under the resource use performance category. We 
propose this approach because: (1) Eligible clinicians participating in 
the Shared Savings Program are already subject to cost and utilization 
performance assessments under the APM; (2) the Shared Savings Program 
measures resource use in terms of an objective, absolute total cost of 
care expenditure benchmark for a population of attributed 
beneficiaries, and participating ACOs may share savings and/or losses 
based on that standard, whereas the MIPS resource use measures are 
relative measures such that clinicians are graded relative to their 
peers, and therefore different than assessing total cost of care for a 
population of attributed beneficiaries; and (3) the beneficiary 
attribution methodologies for measuring resource use under the Shared 
Savings Program and MIPS differ, leading to an unpredictable degree of 
overlap (for eligible clinicians and for CMS) between the sets of 
beneficiaries for which eligible clinicians would be responsible that 
would vary based on unique APM Entity characteristics such as which and 
how many TINs comprise an ACO. We believe that with an APM Entity's 
finite resource for engaging in efforts to improve quality and lower 
costs for a specified beneficiary population, the population identified 
through an APM must take priority to ensure that the goals and program 
evaluation associated with the APM are as clear and free of confounding 
factors as possible. The potential for different, conflicting results 
across Shared Savings Program and MIPS assessments--due to the 
differences in attribution, the inclusion in MIPS of episode-based 
measures that do not reflect the total cost of care, and the objective 
versus relative assessment factors listed above--creates uncertainty 
for eligible clinicians who are attempting to strategically transform 
their respective practices and succeed under the terms of the Shared 
Savings Program.
    For example, Shared Savings Program ACOs are held accountable for 
expenditure benchmarks that reflect the total Medicare Parts A and B 
spending for their assigned beneficiaries, whereas many of the proposed 
MIPS resource use measures focus on spending for particular episodes of 
care or clinical conditions. For the reasons stated above, we consider 
it a programmatic necessity that the Shared Savings Program has the 
ability to structure its own measurement and payment for performance on 
total cost of care independent from other incentive programs such as 
the resource use performance category under MIPS. Thus, we propose to 
reduce the MIPS resource use performance category weight to zero for 
all MIPS eligible clinicians in APM Entities participating in the 
Shared Savings Program. Accordingly, under section 1899(f) of the Act, 
we propose to waive--for MIPS eligible clinicians participating in the 
Shared Savings Program--the requirement under section 
1848(q)(5)(E)(i)(II) of the Act that specifies the scoring weight for 
the resource use performance category. With the proposed reduction of 
the resource use performance category weight to zero, we believe it 
would be unnecessary specify and use resource use measures in 
determining the MIPS CPS for these MIPS eligible clinicians. Therefore, 
under section 1899(f) of the Act, we propose to waive--for MIPS 
eligible clinicians participating in the Shared Savings Program--the 
requirements under sections 1848(q)(2)(B)(ii) and 1848(q)(2)(A)(ii) of 
the Act to specify and use, respectively, resource use measures in 
calculating the MIPS CPS for such MIPS eligible clinicians.
    Given the proposal to waive requirements under section 
1848(q)(5)(E)(i)(II) of the Act in order to reduce the weight of the 
resource use performance category to zero, we must subsequently specify 
how that weight would be redistributed among the remaining performance 
categories in order to maintain a total weight of 100 percent. We 
propose to redistribute the resource use performance category weight to 
both the CPIA and advancing care information performance categories as 
specified in Table 12. The MIPS resource use performance category is 
proposed to have a weight of 10 percent for the first performance 
period. Because the MIPS quality performance category bears a 
relatively higher weight than the other three MIPS performance 
categories, and its weight is scheduled to be reduced from 50 to 30 
percent over time, we propose to evenly redistribute the 10 percent 
resource use performance category weight to the CPIA and advancing care 
information performance categories so that the distribution does not 
change the relative weight of the quality performance category in the 
opposite direction of its future state. The redistributed resource use 
performance category weight of 10 percent would result in a 5 
percentage point increase (from 15 to 20 percent) for the CPIA 
performance category and a 5 percentage point increase (from 25 to 30 
percent) for the advancing care information performance category. We 
invite comments on the proposed weights and specifically, whether we 
should increase the MIPS quality performance category weight.
    We understand that as the MIPS resource use performance category 
evolves over time, there might be greater potential for alignment and 
less potential duplication or conflict with MIPS resource use 
measurement for MIPS eligible clinicians participating in APMs such as 
the Shared Savings Program. We will continue to monitor and consider 
how we might incorporate an assessment in the MIPS resource use 
performance category into the APM scoring standard for MIPS eligible 
clinicians participating in the Shared Savings Program. We also 
understand that reducing the resource use performance category weight 
to zero and redistributing the weight to the CPIA and advancing care 
information performance categories could, to the extent that CPIA and 
advancing care information scores are higher than the scores these MIPS 
eligible clinicians would have received under resource use, result in 
higher average scores for MIPS eligible clinicians participating in the 
Shared Savings Program. We seek comment on the possibility of assigning 
a neutral score to the Shared Savings Program APM Entity groups for the 
resource use performance category to moderate MIPS composite 
performance scores for APM Entities participating in the Shared Savings 
Program. We also generally seek comment on our proposed policy, and on 
whether and how we should incorporate the resource use performance 
category into the APM scoring standard under MIPS for eligible

[[Page 28239]]

clinicians participating in the Shared Savings Program for future 
years.
(9) Shared Savings Program--CPIA and Advancing Care Information 
Performance Category Scoring Under the APM Scoring Standard
    We propose that MIPS eligible clinicians participating in the 
Shared Savings Program would submit data for the MIPS CPIA and 
advancing care information performance categories through their 
respective ACO participant billing TINs independent of the Shared 
Savings Program ACO. Pursuant to section 1848(q)(5)(C)(ii) of the Act, 
all ACO participant group billing TINs would receive a minimum of one 
half of the highest possible score for the CPIA performance category. 
Additionally, pursuant to section 1848(q)(5)(C)(i) of the Act, any ACO 
participant TIN that is determined to be a patient-centered medical 
home or comparable specialty practice will receive the highest 
potential score for the CPIA performance category. The scores from all 
of the ACO participant billing TINs would be averaged to a weighted 
mean MIPS APM Entity group level score. We propose to use a weighted 
mean in computing the overall CPIA and advancing care information 
quality performance category score in order to account for difference 
in the size of each TIN and to allow each TIN to contribute to the 
overall score based on its size. Then all MIPS eligible clinicians in 
the APM Entity group, as identified by their APM participant 
identifiers, would receive that APM Entity score. The weights used for 
each ACO participant billing TIN would be the number of MIPS eligible 
clinicians in that TIN. Because all providers and suppliers that bill 
through the TIN of an ACO participant are required to agree to 
participate in the ACO, all MIPS eligible clinicians that bill through 
the TIN of an ACO participant are considered to be participating in the 
ACO. Any Shared Savings Program ACO participant billing TIN that does 
not submit data for the MIPS CPIA and/or advancing care information 
performance categories would contribute a score of zero for each 
performance category for which it does not report; and that score would 
be incorporated into the resulting weighted average score for the 
Shared Savings Program ACO. All MIPS eligible clinicians in the ACO 
(the APM Entity group) would receive the same score that is calculated 
at the ACO level (the APM Entity).
[GRAPHIC] [TIFF OMITTED] TP09MY16.014

    In this example, each eligible clinician participating in the APM 
Entity (Shared Savings Program ACO) would receive a CPIA performance 
category score of 78.5 and an advancing care information performance 
category score of 85. We recognize that the Shared Savings Program 
eligible clinicians participate as a complete TIN because all of the 
eligible clinicians that have reassigned their Medicare billing rights 
to the TIN of an ACO participant must agree to participate in the 
Shared Savings Program. This is different from other APMs, which may 
include APM Entity groups with eligible clinicians who share a billing 
TIN with other eligible clinicians who do not participate in the APM 
Entity. We seek comment on a possible alternative approach in which 
CPIA and advancing care information performance category scores would 
be applied to all MIPS eligible clinicians at the individual billing 
TIN level, as opposed to aggregated to the ACO level, for Shared 
Savings Program participants. If MIPS APM scores were applied to each 
TIN in an ACO at the TIN level, we would also likely need to permit 
those TINs to make the Partial QP election, as discussed elsewhere in 
this proposed rule, at the TIN level. We propose that under the APM 
scoring standard, the ACO-level APM Entity group score would be applied 
to each participating MIPS eligible clinician to determine the MIPS 
payment adjustment. We believe calculating the score at the APM Entity 
level mirrors the way APM participants are assessed for their shared 
savings and other incentive payments in the APM, but we understand 
there may be reasons why a group TIN, particularly one that believes it 
would achieve a higher score than the weighted average APM Entity level 
score, would prefer to be scored in the CPIA and advancing care 
information performance categories at the level of the group billing 
TIN rather than the ACO (APM Entity level). Therefore, we seek comment 
as to whether Shared Savings Program ACO eligible clinicians should be 
scored at the ACO level or the group billing TIN level for the CPIA and 
advancing care information performance categories. In

[[Page 28240]]

Table 12, we provide a summary of the proposed MIPS data submission 
requirements and scoring under the APM scoring standard for MIPS 
eligible clinicians participating in a Shared Savings Program ACO.
[GRAPHIC] [TIFF OMITTED] TP09MY16.015

(10) Next Generation ACO Model--Quality Performance Category Scoring 
Under the APM Scoring Standard
    Beginning with the first MIPS performance period, all Next 
Generation ACO Model ACOs would submit their ACO quality measures to 
MIPS using the CMS Web Interface through the same process that they use 
to report to the Next Generation ACO Model and be scored as they 
normally would under Next Generation ACO Model rules. Next Generation 
ACO Model ACOs will have used the CMS Web Interface for submitting 
their quality measures since the model's inception and would most 
likely continue to use the CMS Web Interface as the submission method 
in future years. We also propose that the Next Generation ACO Model 
quality measure data that is submitted through the CMS Web Interface 
will be submitted only once but will be used for two purposes. The Next 
Generation ACO Model quality measure data reported to the CMS Web 
Interface would be used by CMS to calculate the MIPS APM quality 
performance score. The MIPS quality performance category requirements 
and performance benchmarks for reporting quality measures via the CMS 
Web Interface would be used to determine the MIPS quality performance 
category score at the ACO level for the APM Entity group. The Next 
Generation ACO Model quality performance data that is not submitted to 
the CMS Web Interface, for example the CAHPS survey and other claims 
measures would not be included in the MIPS APM quality performance 
score. The MIPS APM quality performance category score would be 
calculated using only quality measure data submitted through the CMS 
Web Interface, while the quality reporting requirements and performance 
benchmarks calculated by the Next

[[Page 28241]]

Generation ACO Model would continue to be used to assess the ACO under 
the APM specific requirements. We believe this approach would reduce 
the reporting burden to Next Generation ACO Model participants by 
requiring quality measure data to be submitted only once and used for 
both MIPS and the Next Generation ACO Model.
    We believe that no waivers are necessary here because the quality 
measures submitted via the CMS Web Interface under the Next Generation 
ACO Model are MIPS quality measures and will be scored under MIPS 
performance standards. In the event that Next Generation ACO Model 
quality measures depart from MIPS measures in the future, we will 
address such changes, including whether further waivers are necessary, 
at such a time in future rulemaking.
(11) Next Generation ACO Model--Resource Use Performance Category 
Scoring Under the APM Scoring Standard
    We propose that for the first MIPS performance period, we will not 
assess MIPS eligible clinicians in the Next Generation ACO Model 
participating in the MIPS APM under the resource use performance 
category. We propose this approach because: (1) MIPS eligible 
clinicians participating in the Next Generation ACO Model are already 
subject to cost and utilization performance assessments under the APM; 
(2) the Next Generation ACO Model measures resource use in terms of an 
objective, absolute total cost of care expenditure benchmark for a 
population of attributed beneficiaries, and participating ACOs may 
share savings and/or losses based on that standard, whereas the MIPS 
resource use measures are relative measures such that clinicians are 
graded relative to their peers and therefore different than assessing 
total cost of care for a population of attributed beneficiaries; and 
(3) the beneficiary attribution methodologies for measuring resource 
use under the Next Generation ACO Model and MIPS differ, leading to an 
unpredictable degree of overlap (for eligible clinicians and for CMS) 
between the sets of beneficiaries for which eligible clinicians would 
be responsible that would vary based on unique APM Entity 
characteristics such as which and how many eligible clinicians comprise 
an ACO. We believe that with an APM Entity's finite resources for 
engaging in efforts to improve quality and lower costs for a specified 
beneficiary population, the population identified through the Next 
Generation ACO Model must take priority to ensure that the goals and 
model evaluation associated with the APM are as clear and free of 
confounding factors as possible. The potential for different, 
conflicting results across the Next Generation ACO Model and MIPS 
assessments--due to the differences in attribution, the inclusion in 
MIPS of episode-based measures that do not reflect the total cost of 
care, and the objective versus relative assessment factors listed 
above--creates uncertainty for eligible clinicians who are attempting 
to strategically transform their respective practices and succeed under 
the terms of the Next Generation ACO Model. For example, Next 
Generation ACOs are held accountable for expenditure benchmarks that 
reflect the total Medicare Parts A and B spending for their attributed 
beneficiaries, whereas many of the proposed MIPS resource use measures 
focus on spending for particular episodes of care or clinical 
conditions. For all the reasons stated above, we propose to reduce the 
MIPS resource use performance category weight to zero for all MIPS 
eligible clinicians participating in the Next Generation ACO Model. 
Accordingly, under section 1115A(d)(1) of the Act, we propose to 
waive--for MIPS eligible clinicians participating in the Next 
Generation ACO Model--the requirement under section 
1848(q)(5)(E)(i)(II) of the Act that specifies the scoring weight for 
the resource use performance category. With the proposed reduction of 
the resource use performance category weight to zero, we believe it 
would be unnecessary to specify and use resource use measures in 
determining the MIPS CPS for these MIPS eligible clinicians. Therefore, 
under section 1115A(d)(1) of the Act, we propose to waive--for MIPS 
eligible clinicians participating in the Next Generation ACO Model--the 
requirements under sections 1848(q)(2)(B)(ii) and 1848(q)(2)(A)(ii) of 
the Act to specify and use, respectively, resource use measures in 
calculating the MIPS CPS for such eligible clinicians.
    Given the proposal to waive requirements under section 
1848(q)(5)(E) of the Act in order to reduce the weight of the resource 
use performance category to zero, we must subsequently specify how that 
weight would be redistributed among the remaining performance 
categories in order to maintain a total weight of 100 percent. We 
propose to redistribute the resource use performance category weight to 
both the CPIA and advancing care information performance categories as 
specified in Table 13. The MIPS resource use performance category is 
proposed to have a weight of 10 percent. Because the MIPS quality 
performance category bears a relatively higher weight than the other 
three MIPS performance categories and its weight is scheduled to be 
reduced from 50 to 30 percent over time, we propose to evenly 
redistribute the 10 percent resource use weight to the CPIA and 
advancing care information performance categories so that the 
distribution does not change the relative weight of the quality 
performance category in the opposite direction of its future state. The 
redistributed resource use performance category weight of 10 percent 
would result in a 5 percentage point increase (from 15 to 20 percent) 
for the CPIA performance category and a 5 percentage point increase 
(from 25 to 30 percent) for the advancing care information performance 
category. We invite comments on the proposed redistributed weights and 
specifically on whether we should also increase the MIPS quality 
performance category weight.
    We understand that as the MIPS resource use performance category 
evolves over time, there might be greater potential for alignment and 
less potential duplication or conflict with MIPS resource use 
measurement for MIPS eligible clinicians participating in MIPS APMs 
such as the Next Generation ACO Model. We will continue to monitor and 
consider how we might incorporate an assessment in the MIPS resource 
use performance category into the APM scoring standard for the Next 
Generation ACO Model. We also understand that reducing the resource use 
weight to zero and redistributing the weight to the CPIA and advancing 
care information performance categories could, to the extent that CPIA 
and advancing care information scores are higher than the scores MIPS 
eligible clinicians would have received under resource use, result in 
higher average scores for MIPS eligible clinicians in APM Entity groups 
participating in the Next Generation ACO Model. We seek comment on the 
possible alternative of assigning a neutral score to APM Entity groups 
(ACOs) participating in the Next Generation ACO model for the resource 
use performance category in order to moderate APM Entity scores. We 
also generally seek comment on our proposed policy, and on whether and 
how we should incorporate the resource use performance category into 
the APM scoring standard for MIPS eligible clinicians in APM Entity 
groups participating in the Next Generation ACO model for future years.

[[Page 28242]]

(12) Next Generation ACO Model--CPIA and Advancing Care Information 
Performance Category Scoring Under the APM Scoring Standard
    We propose that all MIPS eligible clinicians participating in the 
Next Generation ACO Model would submit data for the CPIA and advancing 
care information performance categories. Eligible clinicians in the 
Next Generation ACO Model may belong to a billing TIN that includes 
non-participating APM eligible clinicians. Therefore for both CPIA and 
the advancing care information performance category, we propose that 
these MIPS eligible clinicians would submit individual level data to 
MIPS and not group level data.
    For both the CPIA and advancing care information performance 
categories, the scores from all of the individual MIPS eligible 
clinicians in the APM Entity group would be aggregated to the APM 
Entity level and averaged for a mean score. Any individual MIPS 
eligible clinicians that do not report the CPIA or advancing care 
information performance category would contribute a score of zero for 
that performance category in the calculation of the APM Entity score. 
All MIPS eligible clinicians in the APM Entity group would receive the 
same APM Entity score.
    As noted above, because the MIPS quality performance category bears 
a relatively higher weight than the other three MIPS performance 
categories, we propose to evenly redistribute the 10 percent resource 
use performance category weight to the CPIA and advancing care 
information performance categories. Section 1848(q)(5)(C)(i) of the Act 
requires that MIPS eligible clinicians who are in a practice that is 
certified as a patient-centered medical home or comparable specialty 
practice, as determined by the Secretary, with respect to a performance 
period shall be given the highest potential score for the CPIA 
performance category. Accordingly, a MIPS eligible clinician 
participating in an APM Entity that meets the definition of a patient-
centered medical home or comparable specialty practice, as discussed in 
section II.E.5.f. of this proposed rule, will receive the highest 
potential score. Additionally, section 1848(q)(5)(C)(ii) of the Act 
requires that MIPS eligible clinicians participating in APMs that are 
not patient-centered medical homes for a performance period shall earn 
a minimum score of one-half of the highest potential score for CPIA.
    For the APM scoring standard for the first MIPS performance period, 
we propose to weight the CPIA and advancing care information 
performance categories for the Next Generation ACO Model in the same 
way that we propose to weight those categories for the Shared Savings 
Program: 20 percent and 30 percent for CPIA and advancing care 
information, respectively. We seek comment on our proposals for 
reporting and scoring the CPIA and advancing care information 
performance categories under the APM scoring standard. In particular, 
we seek comment on the appropriate weight distributions in the first 
year.
    In Table 13, we provide a summary of the proposed MIPS data 
submission and scoring under the APM scoring standard for MIPS eligible 
clinicians participating in a Next Generation ACO.

[[Page 28243]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.016

(13) MIPS APMs Other Than the Shared Savings Program and the Next 
Generation ACO Model--Quality Performance Category Scoring Under the 
APM Scoring Standard
    For MIPS APMs other than the Shared Savings Program and the Next 
Generation ACO Model, we propose that eligible clinicians or APM 
Entities would submit APM quality measures under their respective MIPS 
APM as usual, and those eligible clinicians or APM Entities would not 
also be required to submit quality information under MIPS. Current MIPS 
APMs have requirements regarding the number of quality measures, 
measure specifications, as well as the measure reporting method(s) and 
frequency of reporting, and have an established mechanism for 
submission of these measures to CMS. We believe there are operational 
considerations and constraints that would prevent us from being able to 
use the quality measure data from some MIPS APMs for the purpose of 
satisfying the MIPS data submission requirements for the quality 
performance category in the first performance period. For example, some 
current APMs use a quality measure data collection system or vehicle 
that is separate and distinct from the MIPS systems. We do not believe 
there is sufficient time to adequately implement changes to the current 
APM quality measure data collection timelines and infrastructure to 
conduct a smooth hand-off to the MIPS system that would enable use of 
APM quality measure data to satisfy the MIPS quality performance 
category requirements in the first MIPS performance period. As we have 
noted, we are concerned about subjecting MIPS eligible clinicians who 
participate in MIPS APMs to multiple performance assessments--under 
MIPS and under the APMs--that are not necessarily aligned and that 
could potentially undermine the validity of testing or performance 
evaluation under the APM. As stated previously, our goal is to reduce 
MIPS eligible clinician reporting burden by not requiring APM 
participants to report quality data twice to CMS, and to avoid 
misaligned performance incentives. Therefore, we propose that, for the 
first MIPS performance period only, for MIPS eligible clinicians 
participating in APM Entity groups in MIPS APMs (other than the Shared 
Savings Program or the Next Generation ACO Model), we would reduce the 
weight for the quality performance category to zero. We believe it is 
necessary to do this because CMS requires additional time to make 
adjustments in systems and processes related to the submission and 
collection of APM quality measures in order to align APM quality 
measures with the MIPS, and ensure APM quality measure data can be 
submitted in a time and in a manner sufficient for use in assessing 
quality performance under MIPS and under the APM. Additionally, due to 
the implementation of a new program that does not account for non-MIPS

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measures sets, the operational complexity of connecting APM performance 
to valid MIPS quality performance category scores in the necessary 
timeframe, as well as the uncertainty of the validity and equity of 
scoring results could unintentionally undermine the quality performance 
assessments in MIPS APMs. Finally, for purposes of performing valid 
evaluations of MIPS APMs, we must reduce the number of confounding 
factors to the extent feasible, which, in this case, would include 
reporting and assessment on non-APM quality measures. Thus, we propose 
to waive certain requirements of section 1848(q) of the Act for the 
first MIPS performance year to avoid risking adverse operational or 
program evaluation consequences for MIPS APMs while we work toward 
incorporating MIPS APM quality measures into MIPS scoring for future 
MIPS performance periods without. Accordingly, under section 
1115A(d)(1) of the Act, we propose to waive--for MIPS eligible 
clinicians participating in MIPS APMs other than the Shared Savings 
Program or the Next Generation ACO Model--the requirement under section 
1848(q)(5)(E)(i)(I) of the Act that specifies the scoring weight for 
the quality performance category. With the proposed reduction of the 
quality performance category weight to zero, we believe it would be 
unnecessary to establish an annual final list of quality measures as 
required under section 1848(q)(2)(D) of the Act, or to specify and use 
quality measures in determining the MIPS CPS for these MIPS eligible 
clinicians. Therefore, under section 1115A(d)(1) of the Act, we propose 
to waive--for MIPS eligible clinicians participating in MIPS APMs other 
than the Shared Savings Program or the Next Generation ACO Model--the 
requirements under sections 1848(q)(2)(D), 1848(q)(2)(B)(i) and 
1848(q)(2)(A)(i) of the Act to establish a final list of quality 
measures (using certain criteria and processes); and to specify and 
use, respectively, quality measures in calculating the MIPS CPS, for 
these MIPS eligible clinicians.
    We anticipate that beginning in the second MIPS performance period, 
the APM quality measure data submitted during the MIPS performance 
period to us would be used to derive a MIPs quality performance score 
for APM Entities in all APMs that meet criteria for application of the 
APM scoring standard. We anticipate that it may be necessary to propose 
policies and waivers of different requirements of the statute--such as 
one for section 1848(q)(2)(D) of the Act, to enable the use of non-MIPS 
quality measures in the quality performance category score--through 
future rulemaking. We expect that by the second MIPS performance period 
we will have had sufficient time to resolve operational constraints 
related to use of separate quality measure systems and adjust quality 
measure data submission timelines. Therefore, beginning with the second 
MIPS performance period, we anticipate that through use of the waiver 
authority under section 1115A(d)(1) of the Act, the quality measure 
data for APM Entities for which the APM scoring standard applies would 
be used for calculation of a MIPS quality performance score in a manner 
specified in future rulemaking. We seek comment on this transitional 
approach to use APM quality measures for the MIPS quality performance 
category for purposes of the APM scoring standard under MIPS in future 
years.
(14) MIPS APMs Other Than the Shared Savings Program and Next 
Generation ACO--Resource Use Performance Category Scoring Under the APM 
Scoring Standard
    For the first MIPS performance period, we propose that, for MIPS 
eligible clinicians participating in MIPS APMs other than the Shared 
Savings Program or the Next Generation ACO, to reduce the weight of the 
resource use performance category to zero. We propose this approach 
because: (1) APM Entity groups are already subject to cost and 
utilization performance assessments under MIPS APMs; (2) MIPS APMs 
usually measure resource use in terms of total cost of care, which is a 
broader accountability standard inherently encompasses the purpose of 
the claims-based measures that have relatively narrow clinical scopes, 
and MIPS APMs that do not measure resource use in terms of total cost 
of care may depart entirely from MIPS measures; and (3) the beneficiary 
attribution methodologies differ for measuring resource use under APMs 
and MIPS, leading to an unpredictable degree of overlap (for eligible 
clinicians and for CMS) between the sets of beneficiaries for which 
eligible clinicians would be responsible that would vary based on 
unique APM Entity characteristics such as which and how many eligible 
clinicians comprise an APM Entity. We believe that with an APM Entity's 
finite resources for engaging in efforts to improve quality and lower 
costs for a specified beneficiary population, the population identified 
through an APM must take priority to ensure that the goals and model 
evaluation associated with the APM are as clear and free of confounding 
factors as possible. The potential for different, conflicting results 
across APM and MIPS assessments creates uncertainty for MIPs eligible 
clinicians who are attempting to strategically transform their 
respective practices and succeed under the terms of an APM. 
Accordingly, under section 1115A(d)(1) of the Act, we propose to 
waive--for MIPS eligible clinicians participating in MIPS APMs other 
than the Shared Savings Program or the Next Generation ACO Model--the 
requirement under section 1848(q)(5)(E)(i)(II) of the Act that 
specifies the scoring weight for the resource use performance category.
    With the proposed reduction of the resource use performance 
category weight to zero, we believe it would be unnecessary to specify 
and use resource use measures in determining the MIPS CPS for these 
MIPS eligible clinicians. Therefore, under section 1115A(d)(1) of the 
Act, we propose to waive--for MIPS eligible clinicians participating in 
MIPS APMs other than the Shared Savings Program or the Next Generation 
ACO Model--the requirements under section under sections 
1848(q)(2)(B)(ii) and 1848(q)(2)(A)(ii) of the Act to specify and use, 
respectively, resource use measures in calculating the MIPS CPS for 
such eligible clinicians.
    Given the proposal to waive requirements of section 1848(q) of the 
Act to reduce the weight of the quality and resource use performance 
categories to zero, we must subsequently specify how those weights 
would be redistributed among the remaining CPIA and advancing care 
information categories in order to maintain a total weight of 100 
percent. We propose to redistribute the quality and the resource use 
performance category weights as specified in Table 14.
    We understand that as the resource use performance category 
evolves, the rationale we discussed earlier for establishing a weight 
of zero for this performance category might not be applicable in future 
years. We seek comment on whether and how we should incorporate the 
resource use performance category into the APM scoring standard under 
MIPS. We also understand that reducing the quality and resource use 
performance category weight to zero and redistributing the weight to 
the CPIA and advancing care information performance categories could, 
to the extent that CPIA and advancing care information scores are 
higher than the scores MIPS eligible clinicians would have received 
under resource use, result in higher average scores for MIPs eligible 
clinicians in

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APM Entity groups participating in MIPS APMs. We seek comment on the 
possible alternative of assigning a neutral score to MIPS eligible 
clinicians in APM Entity groups participating in MIPS APMs for the 
quality and resource use performance category in order to moderate APM 
Entity scores.
(15) MIPS APMs Other Than the Shared Savings Program and Next 
Generation ACO Model--CPIA and Advancing Care Information Performance 
Category Scoring Under the APM Scoring Standard
    We propose that all MIPS eligible clinicians participating in a 
MIPS APM other than the Shared Savings Program or the Next Generation 
ACO would submit data for the CPIA and Advancing Care Information 
performance categories. We propose that these MIPS eligible clinicians 
would submit data for both the CPIA and advancing care information 
performance categories as individual MIPS eligible clinicians. MIPS 
eligible clinicians in these other APMs may belong to a billing TIN 
that includes MIPs eligible clinicians that do not participate in the 
APM. Therefore for both CPIA and the advancing care information 
performance category, we propose that these MIPS eligible clinicians 
submit individual level data to MIPS and not group level data.
    For both the CPIA and advancing care information performance 
categories, the scores from all of the individual MIPS eligible 
clinicians in the APM Entity group would be aggregated to the APM 
Entity level and averaged for a mean score. Any individual MIPS 
eligible clinicians that do not submit data for the CPIA or advancing 
care information performance category would contribute a score of zero 
for that performance category in the calculation of the APM Entity 
score. All MIPS eligible clinicians in the APM Entity group would 
receive the same APM Entity group score.
    Section 1848(q)(5)(C)(i) of the Act requires that MIPS eligible 
clinicians who are in a practice that is certified as a patient-
centered medical home or comparable specialty practice, as determined 
by the Secretary, with respect to a performance period shall be given 
the highest potential score for the CPIA performance category. 
Accordingly, a MIPS eligible clinician in an APM Entity group that 
meets the definition of a patient-centered medical home or comparable 
specialty practice, as discussed in section II.E.5.f. of this proposed 
rule, will receive the highest potential score. Additionally, section 
1848(q)(5)(C)(ii) of the Act requires that MIPS eligible clinicians 
participating in APMs that are not patient-centered medical homes for a 
performance period shall earn a minimum score of one-half of the 
highest potential score for CPIA. We acknowledge that using this 
increased weight for CPIA may make it easier in the first performance 
period to attain a higher MIPS score. We do not have historical data to 
assess the range of scores under CPIA because this is the first time 
such activities are being assessed in such a manner.
    With respect to the advancing care information performance 
category, we believe that MIPS eligible clinicians participating in 
MIPS APMs would be using certified health IT and other health 
information technology to coordinate care and deliver better care to 
their patients. Most MIPS APMs encourage participants to use health IT 
to perform population management, monitor their own quality improvement 
activities and, better coordinate care for their patients in a way that 
aligns with the goals of the advancing care information performance 
category. We want to ensure that where we propose reductions in weights 
for other MIPS performance categories, such weights are appropriately 
redistributed to the advancing care information performance category.
    Therefore, for the first MIPS performance period, we propose that 
the weights for the CPIA and advancing care information performance 
categories would be 25 percent and 75 percent, respectively. We seek 
comment on our proposals for reporting and scoring the CPIA and 
advancing care information performance categories under the APM scoring 
standard. In particular, we seek comment on the appropriate weight 
distributions in the first year and subsequent years when we anticipate 
incorporating assessment in the quality performance category for all 
MIPS eligible clinicians participating in MIPS APMs.
    Table 14 shows the performance category scoring and weights for 
other APMs for which the APM scoring standard applies.

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(14) APM Entity Data Submission Method
    Presently, CMS requires MIPS APMs to either use the CMS Web 
Interface or another data submission mechanism for submitting data on 
the quality measures for purposes of the APM. We are not currently 
proposing to change the method used by APM Entities to submit their 
data on quality measures to CMS for purposes of MIPS. Therefore, we 
expect that APM Entities like the Shared Savings Program ACOs would 
continue to submit their data on quality measures using the CMS Web 
Interface data submission mechanism. Similarly, participants in the 
Comprehensive ESRD Care (CEC) Initiative would continue to submit their 
quality measures to CMS using the Quality Measures Assessment Tool 
(QMAT) for purposes of the CEC quality performance assessment under the 
APM. All eligible clinicians in APM Entities participating in MIPS APMs 
would be required to use one of the proposed MIPS data submission 
mechanisms to submit data for the CPIA and advancing care information 
performance categories.

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(15) MIPS APM Performance Feedback
    For the first MIPS performance feedback specified under section 
1848(q)(12) of the Act to be published by July 1, 2017, we propose that 
all MIPS eligible clinicians participating in MIPS APMs would receive 
the same historical information prepared for all MIPS eligible 
clinicians except the report would indicate that the historical 
information provided to such MIPS eligible clinicians is for 
informational purposes only. MIPS eligible clinicians participating in 
APMs have been evaluated for performance only under the APM. Thus, 
historical information may not be representative of the scores that 
these MIPS eligible clinicians would receive under MIPS.
    For MIPS eligible clinicians participating in MIPS APMs, we propose 
that the MIPS performance feedback would consist only of the scores 
applicable to the APM Entity group for the specific MIPS performance 
period. For example, the MIPS eligible clinicians participating in the 
Shared Savings Program and Next Generation ACO Model would receive 
performance feedback for the quality, CPIA, and advancing care 
information performance categories for the 2017 performance period. 
Because these MIPS eligible clinicians would not be assessed for the 
resource use performance category, information on MIPS performance 
scores for the resource use performance category would not be 
applicable to these MIPS eligible clinicians.
    We also propose that, for the Shared Savings Program the 
performance feedback would be available to the eligible clinicians 
participating in the Shared Savings Program at the group billing TIN 
level. For the Next Generation ACO Model we propose that the 
performance feedback would be available to all MIPS eligible clinicians 
participating in the MIPS APM Entity.
    We propose that in the first MIPS performance period, the MIPS 
eligible clinicians participating in MIPS APMs other than the Shared 
Savings Program or the Next Generation ACO Model would receive 
performance feedback for the CPIA and advancing care information only, 
as they would not be assessed under the quality or resource use 
performance categories. The information such as MIPS measure score 
comparisons for the quality and resource use performance categories 
would not be applicable to these MIPS eligible clinicians because no 
such comparative data would exist. We propose the performance feedback 
for all other MIPS eligible clinicians participating in APMs would be 
available for each MIPS eligible clinician that submitted MIPS data for 
these performance categories under their respective APM Entities. We 
invite comment on these proposals.
6. MIPS Composite Performance Score Methodology
    By incentivizing quality and value for all eligible clinicians, 
MIPS creates a new mechanism for calculating eligible clinician 
payments. To implement this vision, we propose a scoring methodology 
that allows for accountability and alignment across the performance 
categories and minimizes burden on MIPS eligible clinicians. Further, 
we propose a scoring methodology that is meaningful, understandable and 
flexible for all MIPS eligible clinicians. Our proposed methodology 
allows for multiple pathways to success with flexibility for the 
variety of practice types and reporting options. First, we have 
proposed multiple ways that MIPS eligible clinicians may submit data to 
MIPS for the quality performance category. Second, we generally do not 
propose ``all-or-nothing'' reporting requirements for MIPS. Third, 
bonus points would be available for reporting high priority measures 
and electronic reporting of quality data. Recognizing that MIPS is a 
new program, we also outline proposals which we believe are 
operationally feasible for us to implement in the first year, while 
maintaining our longer-term vision, as well as Congress' vision.
    Section 1848(q) of the Act requires the Secretary to: (1) Develop a 
methodology for assessing the total performance of each MIPS eligible 
clinician according to performance standards for a performance period 
for a year; (2) using the methodology, provide a composite performance 
score for each MIPS eligible clinician for each performance period; and 
(3) use the CPS of the MIPS eligible clinician for a performance period 
to determine and apply a MIPS adjustment factor (and, as applicable, an 
additional MIPS adjustment factor) to the MIPS eligible clinician for 
the MIPS payment year. Section II.E.5 of this rule proposes the 
measures and activities for each of the four MIPS performance 
categories: Quality, resource use, CPIA, and advancing care 
information. This section proposes the performance standards for the 
measures and activities for each of the four performance categories 
under section 1848(q)(3) of the Act, the methodology for determining a 
score for each of the four performance categories (referred to as a 
``performance category score''), and the methodology for determining a 
CPS under section 1848(q)(5) of the Act based on the scores determined 
for each of the four performance categories. The performance category 
score is defined at Sec.  414.1305 as the assessment of each MIPS 
eligible clinician's performance on the applicable measures and 
activities for a performance category for a performance period based on 
the performance standards for those measures and activities. Section 
II.E.7. includes proposals for determining the MIPS adjustments factors 
based on the CPS.
    As noted in section II.E.2., we propose to use multiple identifiers 
to allow MIPS eligible clinicians to be measured as individuals, or 
collectively as part of a group or an APM Entity group (an

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APM Entity participating in a MIPS APM). Further, in section 
II.E.5.a.2., we propose that data for all four MIPS performance 
categories would be submitted using the same identifier (either 
individual or group) and that the CPS would be calculated using the 
same identifier. The scoring proposals in this section II.E.6. would be 
applied in the same manner for either individual submissions, proposed 
as TIN/NPI, or for the group submissions using the TIN identifier. 
Unless otherwise noted, for purposes of this section, the term ``MIPS 
eligible clinician'' will refer to both individual and group reporting 
and scoring, but will not refer to an APM Entity group.
    APM Entity group reporting and scoring for MIPS eligible clinicians 
participating in MIPS APMs are described in section II.E.5.h. of this 
proposed rule. All eligible clinicians that participate in APMs are 
considered MIPS eligible clinicians unless and until they are 
determined to be either QPs or Partial QPs who elect not to report 
under MIPS, and excluded from MIPS. For the APM scoring standard to 
apply to a MIPS eligible clinician, the eligible clinician must be 
listed as a participant in the APM Entity that participates in a MIPS 
APM as of December 31 of the performance period, as described in 
section II.E.5.h. CMS will publish a list of MIPS APMs on the CMS Web 
site in advance of the performance period.
    MIPS eligible clinicians who participate in APMs that are not MIPS 
APMs would report to MIPS as an individual MIPS eligible clinician or 
group. Unless otherwise specified, the proposals in this section II.E.6 
that relate to reporting and scoring of measures and activities do not 
affect the APM scoring standard.
    Our rationale for our scoring methodology is grounded in the 
understanding that the MIPS scoring system is a complex system with 
numerous moving parts. Thus, we believe it is necessary to set up key 
parameters around scoring, including requiring MIPS eligible clinicians 
to report at the individual or group level across all performance 
categories and generally to submit information for a performance 
category using a single submission mechanism. Too many different 
permutations would create additional complexities that could create 
confusion amongst MIPS eligible clinicians as to what is and is not 
allowed.
a. Converting Measures and Activities Into Performance Category Scores
(1) Policies That Apply Across Multiple Performance Categories
    The detailed policies for scoring the four performance categories 
are described in this section II.E.6.a. of this rule. However, as the 
four performance categories collectively create a single MIPS CPS, 
there are some cross-cutting policies that we propose to apply to 
multiple performance categories.
(a) Performance Standards
    Section 1848(q)(3)(A) of the Act requires the Secretary to 
establish performance standards for the measures and activities in the 
four MIPS performance categories. Section 1848(q)(3)(B) of the Act 
requires the Secretary, in establishing performance standards for 
measures and activities for the four MIPS performance categories, to 
consider historical performance standards, improvement, and the 
opportunity for continued improvement. We propose to define the term, 
performance standards, at Sec.  414.1305 as the level of performance 
and methodology that the MIPS eligible clinician is assessed on for a 
MIPS performance period at the measures and activities level for all 
MIPS performance categories. We define the term, MIPS payment year at 
Sec.  414.1305 as the calendar year in which MIPS payment adjustments 
are be applied. Performance standards for each performance category are 
proposed in more detail later in this section, II.E.6. MIPS eligible 
clinicians would know the actual performance standards in advance of 
the performance period, when possible. Further, each performance 
category is unified under the principle that MIPS eligible clinicians 
would know, in advance of the performance period, the methodology for 
determining the performance standards and the methodology that would be 
used to score their performance. Table 16 summarizes the performance 
standards, which are proposed in more detail in section II.E.6.a.

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(b) Unified Scoring System
    Section 1848(q)(5)(A) of the Act requires the Secretary to develop 
a methodology for assessing the total performance of each MIPS eligible 
clinician according to performance standards for applicable measures 
and activities in each performance category applicable to the MIPS 
eligible clinician for a performance period. While MIPS has four 
different performance categories, we propose a unified scoring system 
that enables MIPS eligible clinicians, beneficiaries, and stakeholders 
to understand what is required for a strong performance in MIPS while 
being consistent with statutory requirements. We sought to keep the 
scoring as simple as possible, while providing flexibility for the 
variety of practice types and reporting options. We would incorporate 
the following characteristics into the proposed scoring methodologies 
for each of the four MIPS performance categories:
     For the quality and resource use performance categories, 
all measures would be converted to a 10-point scoring system which 
provides a framework to universally compare different types of measures 
across different types of MIPS eligible clinicians. A similar point 
framework has been successfully implemented in several other CMS 
quality programs including the Hospital Value-Based Purchasing Program 
(HVBP).
     The measure and activity performance standards would be 
published, where feasible, before the performance period begins, so 
that MIPS eligible clinicians can track their performance during the 
performance period. This transparency would make the information more 
actionable to MIPS eligible clinicians.
     Unlike the PQRS or the EHR Incentive Program, we generally 
would not include ``all-or-nothing'' reporting requirements for MIPS. 
The methodology would score measures and activities that meet certain 
standards defined in section II.E.5 and this section. However, section 
1848(q)(5)(B)(i) of the Act provides that under the MIPS scoring 
methodology, MIPS eligible clinicians who fail to report on an 
applicable measure or activity that is required to be reported shall be 
treated as receiving the lowest possible score for the measure or 
activity. Therefore, MIPS eligible clinicians that fail to report 
specific measures or activities would receive zero points for each 
required measure or activity that they do not submit to MIPS.
     The scoring system would ensure sufficient reliability and 
validity, by only scoring the measures that meet certain standards 
(such as required case minimum). The standards are described later in 
this section.
     The scoring proposals provide incentives for MIPS eligible 
clinicians to invest and focus on certain measures and activities that 
meet high priority policy goals such as improving beneficiary health, 
improving care coordination through health information exchange, or 
encouraging APM Entity participation.
     Performance at any level would receive points towards the 
performance category scores.
    For the first year of MIPS, there are some minor differences in the 
proposed performance category scoring methodologies to account for 
differences in the maturity of the data collection systems and the 
measures and activities; however, we anticipate that the scoring in 
future years would continue to align and simplify. We request comment 
on the characteristics of the proposed unified scoring system.
    We also propose at Sec.  414.1325 that MIPS eligible clinicians and 
groups may elect to submit information via multiple mechanisms; 
however, they must use the same identifier for all performance 
categories and they may only use one submission mechanism per 
performance category. For example, a MIPS eligible clinician could use 
one submission mechanism for sending quality measures and another for 
sending CPIA data, but a MIPS eligible clinician could not use two 
submission mechanisms for a single performance category, such as 
submitting three quality measures via claims and three quality measures 
via registry. We do intend to allow flexibility, for example, in rare

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situations where a MIPS eligible clinician submits data for a 
performance category via multiple submission mechanisms (for example, 
submits data for the quality performance category through a registry 
and QCDR), we would score all the options and use the highest 
performance category score for the eligible clinician.
    In carrying out MIPS, section 1848(q)(1)(E) of the Act requires the 
Secretary to encourage the use of QCDRs under section 1848(m)(3)(E) of 
the Act. In addition, section 1848(q)(5)(B)(ii) of the Act provides 
that under the methodology for assessing the total performance of each 
MIPS eligible clinician, the Secretary shall encourage MIPS eligible 
clinicians to report on applicable measures under the quality 
performance category through the use of CEHRT and QCDRs. To encourage 
the use of QCDRs, we have created opportunities for QCDRs to report new 
and innovative quality measures. In addition, several CPIAs emphasize 
QCDR participation. Finally, we propose under section II.E.5.a. for 
QCDRs to be able to submit data on all MIPS performance categories. We 
believe these flexible options would allow MIPS eligible clinicians to 
meet the submission criteria for MIPS in a low burden manner, which in 
turn may positively affect their CPS.
    In addition, section 1848(q)(5)(D) of the Act lays out the 
requirements for incorporating performance improvement into the MIPS 
scoring methodology beginning with the second MIPS performance period, 
if data sufficient to measure improvement is available. Section 
1848(q)(5)(D)(ii) of the Act also provides that achievement may be 
weighted higher than improvement. Stated generally, we consider 
achievement to mean how a MIPS eligible clinician performs compared to 
other MIPS eligible clinicians for each applicable measure and activity 
in a performance category, and improvement to mean how a MIPS eligible 
clinician performs compared to the MIPS eligible clinician's own 
previous performance on measures and activities in a performance 
category. Improvement would not be scored for the first year of MIPS, 
but we seek comment on how best to incorporate improvement scoring for 
all performance categories.
(c) Baseline Period
    In other Medicare quality programs, such as the HVBP, we have 
adopted a baseline period that occurs prior to the performance period 
for a program year to measure improvement and to establish performance 
standards. We view the MIPS Program as necessitating a similar baseline 
period for the quality performance category. We intend to establish a 
baseline period for each performance period for a MIPS payment year to 
measure improvement for the quality performance category and to enable 
us to calculate performance standards that we can establish and 
announce prior to the performance period. As with the HVBP, we intend 
to adopt baseline periods that are as close as possible in duration to 
the performance period specified for a MIPS payment year. In addition, 
evaluating performance compared to a baseline period may enable other 
payers to incorporate MIPS benchmarks into their programs. For each 
MIPS payment year, we propose at Sec.  414.1380 that the baseline 
period would be two years prior to the performance period for the MIPS 
payment year. Therefore, for the first MIPS payment year (CY 2019 
payment adjustments), for the quality performance category, we propose 
that the baseline period would be calendar year 2015 which is 2 years 
prior to the proposed calendar year 2017 performance period. As 
discussed in section II.E.6.a.2.a. we propose to use performance in the 
baseline period to set benchmarks for the quality performance category, 
with the exception of new measures for which we would set the 
benchmarks using performance in the performance period. For the 
resource use performance category, we propose to set the benchmarks 
using performance in the performance period and not the baseline 
period, as discussed in section II.E.6.a.3. For the resource use 
performance category, we also have included an alternative proposal to 
set the benchmarks using performance in the baseline period. We define 
the term ``measure benchmark'' for the quality and resource use 
performance categories at Sec.  414.1305 as the level of performance 
that the MIPS eligible clinician will be assessed on for a performance 
period at the measures level.
(2) Scoring the Quality Performance Category
    In section II.E.5.b.3, we proposed multiple ways that MIPS eligible 
clinicians may submit data for the quality performance category to 
MIPS; however, we propose that the scoring methodology would be 
consistent regardless of how the data is submitted. In summary, we 
propose at Sec.  414.1380(b)(1) to assign 1-10 points to each measure 
based on how a MIPS eligible clinician's performance compares to 
benchmarks. Measures must have the required case minimum to be scored. 
If a MIPS eligible clinician fails to submit a measure required under 
the quality performance category criteria, then the MIPS eligible 
clinician would receive zero points for that measure. MIPS eligible 
clinicians would not receive zero points if the required measure is 
submitted (meeting the data completeness criteria as defined in section 
II.E.5.b.3.b.) but is unable to be scored for any of the reasons listed 
in this section II.E.6.a.2., such as not meeting the required case 
minimum or a measure lacks a benchmark). For example, if a MIPS 
eligible clinician reports a measure that meets the requirements 
specified in section II.E.5.b., but that measure does not meet the 
required case minimum criteria or lacks a benchmark, then the measure 
would not be scored under the MIPS quality performance category, 
whereas a MIPS eligible clinician that did not report this measure 
would have the measure scored as a zero. We describe in section 
II.E.6a.2.d. examples of how points would be allocated and how to 
compute the overall quality performance category score under these 
scenarios. Bonus points would be available for reporting high priority 
measures, defined as outcome, appropriate use, efficiency, care 
coordination, patient safety, and patient experience measures.
    As discussed in section II.E.6.a.2.g., the quality performance 
category score would be the sum of all the points assigned for the 
scored measures required for the quality performance category plus the 
bonus points (subject to the cap) divided by the sum of total possible 
points. Since MIPS eligible clinicians would be generally required to 
submit six measures or six measures from a specialty measure set and we 
would also score MIPS eligible clinicians on up to three population-
based measures calculated from administrative claims data as discussed 
in section II.5.b.6, the total possible points for the quality 
performance category would be 90 points (6 submitted measures x 10 
points + 3 population-based measures x 10 points = 90). However, for 
eligible groups reporting via CMS Web Interface, the total possible 
points for the quality performance category would be 210 points (17 
measures x 10 points + 3 population-based measures x 10 points = 200), 
subject to CMS Web Interface reporting criteria. Further, the total 
possible points for small groups of less than 10 would be 80 points (6 
submitted measures x 10 points + 2 population-based measures x 10 
points = 80) because under our proposals the all-cause hospital 
readmissions measure

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would not be applicable to groups of less than 10 MIPS eligible 
clinicians and MIPS eligible clinicians reporting as individuals due to 
reliability concerns. Therefore, small groups of less than 10 and MIPS 
eligible clinicians reporting as individuals would only be scored on 
two population-based measures.
    In section II.E.6.b, we discuss how we would score MIPS eligible 
clinicians who do not have any scored measures in the quality 
performance category. The details of the proposed scoring methodology 
for the quality performance category are described below.
(a) Quality Measure Benchmarks
    For the quality performance category, we propose at Sec.  
414.1380(b)(1) that the performance standard is measure-specific 
benchmarks. Benchmarks would be determined based on performance on 
measures in the baseline period. For quality performance category 
measures for which there are baseline period data, we would calculate 
an array of measure benchmarks based on performance during the baseline 
period, breaking baseline period measure performance into deciles. 
Then, a MIPS eligible clinician's actual measure performance during the 
performance period would be evaluated to determine the number of points 
that should be assigned based on where the actual measure performance 
falls within these baseline period benchmarks. If a measure does not 
have baseline period information, (for example, new measures) or if the 
measure specifications for the baseline period differ substantially 
from the performance period (for example, when the measure requirements 
change due to updated clinical guidelines), then we would determine the 
array of benchmarks based on performance on the measure in the 
performance period, breaking the actual performance on the measure into 
deciles. In addition, we propose to create separate benchmarks for 
submission mechanisms that do not have comparable measure 
specifications. For example, several electronic clinical quality 
measures have specifications that are different than the corresponding 
measure from registries. We propose to develop separate benchmarks for 
EHR submission options, claims submission options, Qualified Clinical 
Data Registries (QCDRs) and qualified registries submission options.
    For CMS Web Interface reporting, we propose to use the benchmarks 
from the Shared Savings Program as described at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Quality-Measures-Standards.html. We would adopt the Shared Savings Program 
performance year benchmarks for measures that are reported through the 
CMS Web Interface for the MIPS performance period, but would apply the 
MIPS method of assigning 1 to 10 points to each measure. For example, 
for the 2017 MIPS performance year, we would use the benchmarks for the 
2017 Shared Savings Program performance year, as both the MIPS 
performance period and the Shared Savings Program performance year use 
a calendar year for CMS Web Interface reporting. Because the Shared 
Savings Program does not create benchmarks below the 30th percentile, 
we would assign all scores below the 30th percentile a value of 2 
points, which is consistent with the mid-cluster approach we are 
proposing for topped out measures. We believe using the same benchmarks 
for MIPS and the Shared Savings Program for the CMS Web Interface 
measures would be appropriate because, as is discussed in II.E.5.h., we 
propose to use the MIPS benchmarks to score the Shared Savings Program 
and the Next Generation ACO Model on the quality performance category 
and believe it is important to not have conflicting benchmarks. We 
would post the MIPS CMS Web Interface benchmarks with the other MIPS 
benchmarks.
    As an alternative approach, we considered creating CMS Web 
Interface specific benchmarks for MIPS. This alternative would be 
restricted to CMS Web Interface reporters and would not include other 
MIPS data submission methods, which are currently used to create the 
Shared Saving Program benchmarks. This alternative would also apply the 
topped out cluster approach if any measures are topped out. While we 
see benefit in having CMS Web Interface methodology match the other 
MIPS benchmarks, we are also concerned about the Shared Saving Program 
and the Next Generation ACO Model participants having conflicting 
benchmark data. We request comments on building CMS Web Interface 
specific benchmarks.
    All MIPS eligible clinicians, regardless of whether they report as 
an individual or group, and regardless of specialty, that submit data 
using the same submission mechanism would be included in the same 
benchmark. We propose to unify the calculation of the benchmark by 
using the same approach as the VM of weighting the performance rate of 
each MIPS eligible clinician and group submitting data on the quality 
measure by the number of beneficiaries used to calculate the 
performance rate so that group performance is weighted appropriately 
(77 FR 69321-69322). We would also include APM Entity submissions in 
the benchmark but would not score APM Entities using this methodology. 
For APM scoring, we refer to section II.E.5.h.
    To ensure that we have robust benchmarks, we propose that each 
benchmark must have a minimum of 20 MIPS eligible clinicians who 
reported the measure meeting the data completeness requirement defined 
in section II.E.5.b.3, as well as meeting the required case minimum 
criteria for scoring that is defined later in this section. We selected 
a minimum of 20 because, as discussed below, our benchmarking 
methodology relies on assigning points based on decile distributions 
with decimals. A decile distribution requires at least 10 observations. 
We doubled the requirement to 20 so that we would be able to assign 
decimal point values and minimize cliffs between deciles. We did not 
want to increase the benchmark sample size requirement due to concerns 
that an increase could limit the number of measures with benchmarks.
    We also propose that MIPS eligible clinicians who report measures 
with a performance rate of 0 percent would not be included in the 
benchmarks. In our initial analysis, we identified some measures that 
had a large cluster of eligible clinicians with a 0 percent performance 
rate. We are concerned that the 0 percent performance rate represents 
clinicians who are not actively engaging in that measurement activity. 
For example, it could be clinicians reporting the measures that are 
programmed into their EHR and that are submitted unintentionally, 
rather than measures the eligible clinician has actively selected for 
quality improvement. We do not want to inappropriately skew the 
distribution. We seek comment on whether or not to include 0 percent 
performance in the benchmark.
    We propose at Sec.  414.1380(b)(1)(i) to base the benchmarks on 
performance in the baseline period when possible, and to publish the 
numerical benchmarks when possible, prior to the start of the 
performance period. In those cases where we do not have comparable data 
from the baseline period, we propose to use information from the 
performance period to establish benchmarks. While the benchmark 
methodology would be established in a final rule in advance of the 
performance period, the actual numerical benchmarks would not be 
published until after the performance period for quality measures that 
do not

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have comparable data from the baseline period. The methodology for 
creating the benchmarks is discussed below in this section.
    We considered not scoring measures that either are new to the MIPS 
program or do not have a historical benchmark based on performance in 
the baseline period. This policy would be consistent with the VM policy 
in which we do not score measures that have no benchmark (77 FR 69322). 
However, we are concerned that such a policy could stifle reporting on 
innovative new measures because it would take several years for the 
measure to be incorporated into the performance category score. We also 
believe that any issues related to reporting a new measure would not 
disproportionately affect the relative performance between MIPS 
eligible clinicians.
    We also considered a variation on the scoring methodology that 
would provide a floor for a new MIPS measure. Under this variation, if 
a MIPS eligible clinician reports a new measure under the quality 
performance category, the MIPS eligible clinician would not score lower 
than 3 points for that measure. This would encourage reporting on new 
measures, but also prevent MIPS eligible clinicians from receiving the 
lowest scores for a new measure, while still measuring variable 
performance. Finally, we also considered lowering the weight of a new 
measure, so that new measures would contribute relatively less to the 
score compared to other measures. In the end, we are not proposing 
these alternatives we considered, because we want to encourage adoption 
and measured performance of new measures, however, we do request 
comment on these alternatives, including comments on what the lowest 
score should be for MIPS eligible clinicians who report a new measure 
under the quality performance category and protections against 
potential gaming related to reporting of new measures only. We also 
seek comments on alternative methodologies for scoring new measures 
under the quality performance category, which would assure equity in 
scoring between the methodology for measures for which there is 
baseline period data and for new measures which do not have baseline 
period data available.
    Finally, we want to clarify that some PQRS reporting mechanisms 
have limited experience with all-payer data. For example, under PQRS, 
all-payer data was permitted only when reporting via registries for 
measure groups; reporting via registries for individual measures was 
restricted to Medicare only. Under MIPS however, we intend to have more 
robust data submissions, as described in section II.E.5.b.3. We 
recognize that comparing all-payer performance to a benchmark that is 
built, in part, on Medicare data is a limitation and would monitor the 
benchmarks to see if we need to develop separate benchmarks. This data 
issue would resolve in a year or two, as new MIPS data becomes the 
historical benchmark data in future years.
(b) Assigning Points Based on Achievement
    We propose at Sec.  414.1380(b)(1)(x) to establish benchmarks using 
a percentile distribution, separated by decile categories, because it 
translates measure-specific score distributions into a uniform 
distribution of MIPS eligible clinicians based on actual performance 
values. For each set of benchmarks, we propose to calculate the decile 
breaks for measure performance and assign points for a measure based on 
which benchmark decile range the MIPS eligible clinician's performance 
rate on the measure falls between. For example, MIPS eligible 
clinicians in the top decile would receive 10 points for the measure, 
and MIPS eligible clinicians in the next lower decile would receive 
points ranging from 9 to 9.9. We propose to assign partial points to 
prevent performance cliffs for MIPS eligible clinicians near the decile 
breaks. The partial points would be assigned based on the percentile 
distribution.
    Table 17 illustrates an example of using decile points along with 
partial points to assign achievement points for a sample quality 
measure. The methodology in this example could apply to measures where 
the benchmark is based on the baseline period or for new measures where 
the benchmark is based on the performance period.
[GRAPHIC] [TIFF OMITTED] TP09MY16.020

    In the example above, a MIPS eligible clinician with a measure 
performance rate of 41 percent would receive 6.0 points based on the 
benchmark. MIPS eligible clinicians with measure performance rates of 
85 percent or above would receive 10 points because they were in the 
top benchmark decile. We believe that MIPS eligible clinicians within 
the top decile in performance would warrant receiving the maximum 
number of points. This is a similar concept to the HVBP ``benchmark'' 
level. We note that 85 percent is solely illustrative. Any MIPS 
eligible clinician who reports some level of performance would receive 
a minimum of one point for reporting if the measure has the required 
case minimum, assuming the measure has a benchmark.
    In Table 17 we described our scoring approach, using deciles. We do 
not propose to base scoring on decile distributions for the same 
measure

[[Page 28253]]

ranges as described in Table 17 when performance is clustered at the 
high end (that is, ``topped out'' measures), as true variance cannot be 
assessed. MIPS eligible clinicians report on different measures and 
often elect to submit measures on which they expect to perform well. 
With MIPS eligible clinicians electing to report on measures where they 
expect to perform well, we anticipate many measures would have 
performance distributions clustered near the top. We propose to 
identify ``topped out'' measures by using a definition similar to the 
definition used in the HVBP: Truncated Coefficient of Variation \13\ is 
less than 0.10 and the 75th and 90th percentiles are within 2 standard 
errors; \14\ or median value for a process measure that is 95 percent 
or greater (80 FR 49550).\15\
---------------------------------------------------------------------------

    \13\ The 5% of MIPS eligible clinicians with the highest scores, 
and the 5% with lowest scores are removed before calculating the 
Coefficient of Variation.
    \14\ This is a test of whether the range of scores in the upper 
quartile is statistically meaningful.
    \15\ This last criterion is in addition to the HVBP definition.
---------------------------------------------------------------------------

    Using 2014 PQRS quality reported data measures, we modeled the 
proposed benchmark methodology and identified that approximately half 
of the measures proposed under the quality performance category are 
topped out. Several measures have a median score of 100 percent, which 
makes it difficult to assess relative performance needed for the 
quality performance category score.
    However, we do not believe it would be appropriate to remove topped 
out measures at this time. As not all MIPS eligible clinicians would be 
required to report these measures under our proposals for the quality 
performance category in section II.E.5.b. it would be difficult to 
determine whether a measure is truly topped out or if only excellent 
performers are choosing to report the measure. We also believe removing 
such a large volume of measures would make it difficult for some 
specialties to have enough applicable measures to report. At the same 
time, we do not believe that the highest values on topped out measures 
convey the same meaning of relative quality performance as the highest 
values for measures that are not topped out. In other words, we do not 
believe that eligible clinicians electing to report topped out process 
measures should be able to receive the same maximum score as eligible 
clinicians electing to report preferred measures, such as outcome 
measures.
    Therefore, we propose to modify the benchmark methodology for 
topped out measures. Rather than assigning up to 10 points per measure, 
we propose to limit the maximum number of points a topped out measure 
can achieve based on how clustered the scores are. We propose to 
identify clusters within topped out measures and would assign all MIPS 
eligible clinicians within the cluster the same value, which would be 
the number of points available at the midpoint of the cluster. That is, 
we would take the midpoint of the highest and lowest scores that would 
pertain if the measure was not topped out and the values were not 
clustered. We would only apply this methodology for benchmarks based on 
the baseline period. When we develop the benchmarks, we would identify 
the clusters and state the points that would be assigned when the 
measure performance rate is in a cluster. We would notify MIPS eligible 
clinicians when those benchmarks are published with regard to which 
measures are topped out.
    Table 18 illustrates this hypothetical example. In developing the 
benchmark, we identified that the top five deciles (50 percent of 
eligible clinicians reporting the measure) of MIPS eligible clinicians 
are clustered at 100 percent. We would identify the middle of that 
cluster (in this example, the top 25 percent or the middle of the 
eighth decile) and then assign all MIPS eligible clinicians with 
performance rates in the cluster the same number of points for the 
measure. The decile points for the hypothetical topped out measure in 
Table 18 shows that the maximum a MIPS eligible clinician can receive 
for the topped out measure is 8.5 points in this example.
[GRAPHIC] [TIFF OMITTED] TP09MY16.021

    We propose this approach because we want to encourage MIPS eligible 
clinicians not to report topped out measures, but to instead choose 
other measures that are more meaningful. We also seek feedback on 
alternative ways and an alternative scoring methodology to address 
topped out measures so that topped out measures do not 
disproportionately affect a MIPS eligible clinician's quality 
performance category score. Other alternatives could include placing a 
limit on the number of topped out measures MIPS eligible clinicians may 
submit or reducing the weight of topped out measures. We also 
considered whether we should apply a flat percentage in building the 
benchmarks, similar to the Shared Savings Program, where MIPS eligible 
clinicians are scored on their percentage of their performance rate and 
not on a decile distribution and request comment on how to apply such a 
methodology without providing an incentive to report topped out 
measures. Under the Shared Savings Program, 42 CFR 425.502, there are 
circumstances when benchmarks are set using flat percentages. For some 
measures, benchmarks are set using flat percentages when the 60th 
percentile was equal to or greater than 80.00 percent, effective 
beginning with the 2014 reporting year (78 FR 74759-74763). For other 
measures benchmarks are set using flat percentages when the 90th 
percentile was equal to or greater than 95.00 percent, effective 
beginning in 2015 (79 FR 67925). Flat percentages

[[Page 28254]]

allow those with high scores to earn maximum or near maximum quality 
points while allowing room for improvement and rewarding that 
improvement in subsequent years. Use of flat percentages also helps 
ensure those with high performance on a measure are not penalized as 
low performers. We also note that we anticipate removing topped out 
measures over time, as we work to develop new quality measures that 
will eventually replace these topped out measures. We request feedback 
on these proposals.
(c) Case Minimum Requirements and Measure Reliability and Validity
    We seek to ensure that MIPS eligible clinicians are measured 
reliably; therefore, we propose at Sec.  414.1380(b)(1)(v) to use for 
the quality performance category measures the case minimum requirements 
for the quality measures used in the 2018 VM (see Sec.  414.1265): 20 
cases for all quality measures, with the exception of the all-cause 
hospital readmissions measure, which has a minimum of 200 cases. We 
refer readers to Table 46 of the CY 2016 PFS final rule (80 FR 71282) 
which summarized our analysis of the reliability of certain claims-
based measures used for the 2016 VM payment adjustment. MIPS eligible 
clinicians that report measures with fewer than 20 cases (and the 
measure meets the data completeness criteria) would receive recognition 
for submitting the measure, but the measure would not be included for 
MIPS quality performance category scoring. Since the all-cause hospital 
readmissions measure does not meet the threshold for what we consider 
to be moderate reliability for solo practitioners and groups of less 
than ten MIPS eligible clinicians for purposes of the VM (see Table 46 
of the CY 2016 PFS final rule, referenced above), for consistency, we 
propose to not include the all-cause hospital readmissions measure in 
the calculation of the quality performance category for MIPS eligible 
clinicians who individually report, as well as solo practitioners or 
groups of two to nine MIPS eligible clinicians.
    We also propose that if we identify issues or circumstances that 
would impact the reliability or validity of a measure score, we would 
also exclude those measures from scoring. For example, if we discover 
that there was an unforeseen data collection issue that would affect 
the integrity of the measure information, we would not want to include 
that measure in the quality performance category score. If a measure is 
excluded, we would recognize that the measure had been submitted and 
would not disadvantage the MIPS eligible clinicians by assigning them 
zero points for a non-reported measure. In this instance, if the MIPS 
eligible clinician, as a solo practitioner, scored 10 out of 10 on each 
of the remaining five measures submitted, and the two population-based 
measures applicable to solo practitioners, the MIPS eligible clinician 
would receive a perfect score in the quality performance category (5 
measures x 10 points) + (2 population-based measures x 10 points) or 70 
out of 70 possible points.
(d) Scoring for MIPS Eligible Clinicians that Do Not Meet Quality 
Performance Category Criteria
    Section II.E.5.b. of this proposed rule outlines our proposed 
quality performance category criteria for the different reporting 
mechanisms. The criteria vary by reporting mechanism, but generally we 
propose to include a minimum of six measures with at least one cross-
cutting measure (for patient facing MIPS eligible clinicians) (Table C) 
and an outcome measure if available. If an outcome measure is not 
available, then the eligible clinician would report one other high 
priority measure (appropriate use, patient safety, efficiency, patient 
experience, and care coordination measures) in lieu of an outcome 
measure. MIPS eligible clinicians and groups would have to select their 
measures from either the list of all MIPS Measures in Table A or a set 
of specialty specific measures in Table E.
    We note that there are some special scenarios for those MIPS 
eligible clinicians who select their measures from the Specialty Sets 
(Table E) as discussed in section II.E.5.b.
    For groups using the CMS Web Interface and MIPS APMs, we propose to 
have different quality performance category criteria described in 
sections II.E.5.b. and II.E.5.h. Additionally, as described in section 
II.E.5.b. we also propose to score MIPS eligible clinicians on up to 
three population-based measures.
    Previously in PQRS, EPs had to meet all the criteria or be subject 
to a negative payment adjustment. We heard from numerous commenters a 
desire to move away from ``all-or-nothing'' scoring. Therefore, in 
MIPS, we propose that MIPS eligible clinicians receive credit for 
measures that they report, regardless of whether or not the MIPS 
eligible clinician meets the quality performance category submission 
criteria. Section 1848(q)(5)(B)(i) of the Act provides that under the 
MIPS scoring methodology, MIPS eligible clinicians who fail to report 
on an applicable measure or activity that is required to be reported 
shall be treated as receiving the lowest possible score for the measure 
or activity; therefore, for any MIPS eligible clinician who does not 
report a measure required to satisfy the quality performance category 
submission criteria, we propose that the MIPS eligible clinician would 
receive zero points for that measure. For example, a MIPS eligible 
clinician who is able to report on six measures, yet reports on four 
measures, would receive two ``zero'' scores for the missing measures. 
In another example, a patient facing MIPS eligible clinician reports 
more than six measures, but does not elect to report a cross-cutting 
measure and an outcome measure, or if one is not available, another 
high priority measure. The MIPS eligible clinician in that scenario 
would receive at least two ``zero'' scores for not reporting measures 
required by the quality performance category criteria.
    However, MIPS eligible clinicians who report a measure that does 
not meet the required case minimum would not be scored on the measure 
but would also not receive a ``zero'' score. For example, a MIPS 
eligible clinician who submits six measures as part of a group with 10 
or more clinicians, one of which does not meet the required case 
minimum, would be scored on the five remaining measures and the three 
population-based measures based on administrative claims data. If the 
MIPS eligible clinician scored 10 out of 10 on each of these measures, 
the MIPS eligible clinician would receive a perfect score in the 
quality performance category (5 measures x 10 points) + (3 population-
based measures x 10 points) or 80 out of 80 possible points.
    We also note that if MIPS eligible clinicians are able to submit 
measures that can be scored, we want to discourage them from continuing 
to submit the same measures year-after-year that cannot be scored due 
to not meeting the required case minimum. Rather, to the fullest extent 
possible, MIPS eligible clinicians should select measures that would 
have a required case minimum. We seek comment on any safeguards we 
should implement in future years to minimize any gaming attempts. For 
example, if the measures that a MIPS eligible clinician submits for a 
performance period are not able to be scored due to not meeting the 
required case minimum, we seek comment on whether we should require 
these MIPS eligible clinicians to submit different measures with 
sufficient cases for the next performance period (to the

[[Page 28255]]

extent other measures are applicable and available to them).
    MIPS eligible clinicians who report a measure where there is no 
benchmark due to less than 20 MIPS eligible clinicians reporting on the 
measure would not be scored on the measure but would also not receive a 
``zero'' score. Instead, these MIPS eligible clinicians would be scored 
according to the following example: A MIPS eligible clinician who 
submits six measures through a group of 10 or more clinicians, with one 
measure lacking a benchmark, would be scored on the five remaining 
measures and the three population-based measures based on 
administrative claims data. If the MIPS eligible clinician scored 10 
out of 10 on each of these measures, the MIPS eligible clinician would 
receive a perfect score in the quality performance category (5 measures 
x 10 points) + (3 population-based measures x 10 points) or 80 out of 
80 possible points.
    We intend to develop a validation process to review and validate a 
MIPS eligible clinician's inability to report on the quality 
performance requirements as proposed in section II.E.5.b. We anticipate 
that this process would function similar to the Measure Applicability 
Validity (MAV) process that occurred under PQRS, with a few exceptions. 
First, the MAV process under PQRS was a secondary process after an EP 
was determined to not be a satisfactory reporter. Under MIPS, we intend 
to build the process into our overall scoring approach to reduce 
confusion and burden on MIPS eligible clinicians by having a separate 
process. Second, as the requirements under PQRS are different than 
those proposed under MIPS, the process must be updated to account for 
different measures and different quality performance requirements. More 
information on the MAV process under PQRS can be found at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/Downloads/2016_PQRS_MAV_ProcessforClaimsBasedReporting_030416.pdf. We request 
comments on these proposals.
(e) Incentives To Report High Priority Measures
    Consistent with other CMS value-based payment programs, we propose 
that MIPS scoring policies would emphasize and focus on high priority 
measures that impact beneficiaries. These high priority measures are 
defined as outcome, appropriate use, patient safety, efficiency, 
patient experience and care coordination measures; see Tables A-D for 
these measures. We propose these measures as high priority measures 
given their critical importance to our goals of meaningful measurement 
and our measure development plan. We note that many of these measures 
are grounded in NQS domains. For patient safety, efficiency, patient 
experience and care coordination measures, we refer to the measures 
within the respective NQS domains and measure types. For outcomes 
measures, we include both outcomes measures and intermediate outcomes 
measures. For appropriate use measures, we have noted which measures 
fall within this category in Tables A-D and provided criteria for how 
we identified these measures in section II.E.5.b. For non-MIPS measures 
reported through QCDRs, we propose to classify which measures are high 
priority during the measure review process.
    We are proposing scoring adjustments to create incentives for MIPS 
eligible clinicians to submit certain high priority measures and to 
allow these measures to have more impact on the total quality 
performance category score.
    We propose to create an incentive for MIPS eligible clinicians to 
voluntarily report additional high priority measures. We propose to 
provide two bonus points for each outcome and patient experience 
measure and one bonus point for other high priority measures reported 
in addition to the one high priority measure (an outcome measure, but 
if one is not available, then another high priority measure) that would 
already be required under the proposed quality performance category 
criteria. For example, if a MIPS eligible clinician submitted two 
outcome measures, and two patient safety measures, the MIPS eligible 
clinician would receive two bonus points for the second outcome measure 
reported and two bonus points for the two patient safety measures. The 
MIPS eligible clinician would not receive any bonus points for the 
first outcome measure submitted since that is a required measure. We 
selected two bonus points for outcome measures given the statutory 
requirements under section 1848(q)(2)(C)(i) of the Act to emphasize 
outcome measures. We selected two bonus points for patient experience 
measures given the importance of patient experience measures to our 
measurement goals. We selected one bonus point for all other high 
priority measures given our measurement goals around each of those 
areas of measurement. We believe the number of bonus points provides 
extra credit for submitting the measure, yet would not mask poor 
performance on the measure. For example, a MIPS eligible clinician with 
poor outcomes receives only two points for performance for a particular 
high priority measure. The bonus points would increase the MIPS 
eligible clinician's points to three (or four if the measure is an 
outcome measure or patient experience measure), but that amount is far 
less than the ten points a top performer would receive. We note that 
population-based measures would not receive bonus points.
    We note that a MIPS eligible clinician who submits a high priority 
measure but had a performance rate of 0 percent would not receive any 
bonus points. Eligible clinicians would only receive bonus points if 
the performance rate is greater than zero. Bonus points are also 
available for measures that are not scored (not included in the top 6 
measures for the quality performance category score) as long as the 
measure has the required case minimum and data completeness. We believe 
these qualities would allow us to include the measure in future 
benchmark development.
    For groups submitting data through the CMS Web Interface, including 
MIPS APMs that report through the CMS Web Interface, groups are 
required to submit a set of predetermined measures and groups are 
unable to submit additional measures. For that submission mechanism, we 
propose to apply bonus points based on the finalized set of measures. 
We would assign two bonus points for each outcome measure (after the 
first required outcome measure) and for each patient experience 
measure. We would also have one additional bonus point for each other 
high priority measure (patient safety, efficiency, appropriate use, 
care coordination). We believe MIPS eligible clinicians or groups 
should have the ability to receive bonus points for reporting high 
priority measures through all submission mechanisms, including the CMS 
Web Interface. In the final rule, we will publish how many bonus points 
the CMS Web Interface measure set would have available based on the 
final list of measures.
    We propose to cap the bonus points for the high priority measures 
(outcome, appropriate use, patient safety, efficiency, patient 
experience, and care coordination measures) at 5 percent of the 
denominator of the quality performance category score. Tables 19 and 20 
illustrate examples of how to calculate the bonus cap. We also propose 
an alternative approach of capping bonus points for high priority 
measures at 10 percent of the denominator of the quality performance 
category score. Our rationale for the 5

[[Page 28256]]

percent cap is that we do not want to mask poor performance by allowing 
an MIPS eligible clinician to perform poorly on a measure but still 
obtain a high quality performance category score by submitting numerous 
high priority measures in order to obtain bonus points; however, we are 
also concerned that 5 percent may not be enough incentive to encourage 
reporting. We request comment on the appropriate threshold for this 
bonus cap.
(f) Incentives To Use CEHRT To Support Quality Performance Category 
Submissions
    Section 1848(q)(5)(B)(ii) of the Act provides that under the 
methodology for assessing the total performance of each MIPS eligible 
clinician, the Secretary shall: (I) Encourage MIPS eligible clinicians 
to report on applicable measures under the quality performance category 
through the use of CEHRT and QCDRs; and (II) with respect to a 
performance period for a year, for which a MIPS eligible clinician 
reports applicable measures under the quality performance category 
through the use of CEHRT, treat the MIPS eligible clinician as 
satisfying the clinical quality measures reporting requirement under 
section 1848(o)(2)(A)(iii) of the Act for such year. To encourage the 
use of CEHRT for quality improvement and reporting on measures under 
the quality performance category, we are proposing a scoring incentive 
to MIPS eligible clinicians who use their CEHRT systems to capture and 
report quality information.
    We propose to allow one bonus point under the quality performance 
category score, up to a maximum of 5 percent of the denominator of the 
quality performance category score if:
     The MIPS eligible clinician uses CEHRT to record the 
measure's demographic and clinical data elements in conformance to the 
standards relevant for the measure and submission pathway, including 
but not necessarily limited to the standards included in the CEHRT 
definition proposed in 414.1305;
     The MIPS eligible clinician exports and transmits measure 
data electronically to a third party using relevant standards or 
directly to CMS using a submission method as defined at Sec.  414.1325; 
and
     The third party intermediary (for example, a QCDR) uses 
automated software to aggregate measure data, calculate measures, 
perform any filtering of measurement data, and submit the data 
electronically to CMS using a submission method as defined at Sec.  
414.1325.
    These requirements are referred to as ``end-to-end electronic 
reporting.''
    We note that this bonus would be in addition to the high priority 
bonus. MIPS eligible clinicians would be eligible for both this bonus 
option and the high priority bonus option with separate bonus caps for 
each option. We also propose an alternative approach of capping bonus 
points for this option at 10 percent of the denominator of the quality 
performance category score. Our rationale for the 5 percent cap is that 
we do not want to mask poor performance by allowing a MIPS eligible 
clinician to perform poorly on a measure but still obtain a high 
quality performance category score by submitting numerous measures in 
order to obtain bonus points; however, we are also concerned that 5 
percent may not be enough incentive to encourage end-to-end electronic 
reporting. We seek comment on the appropriate threshold for this bonus 
cap. We propose the CEHRT bonus would be available to all submission 
mechanisms except claims submissions. This incentive would also be 
available for MIPS APMs reporting through the CMS Web Interface. 
Specifically, MIPS eligible clinicians who report via qualified 
registries, QCDRs, EHR submission mechanisms, and CMS Web Interface may 
receive one bonus point for each reported measure with a cap as 
described. We do not propose to allow this option for claims 
submission, because there is no mechanism for MIPS eligible clinicians 
to identify the information was pulled using an EHR.
    This approach supports and encourages innovative approaches to 
measurement using the full array of standards ONC adopts, and the data 
elements MIPS eligible clinicians capture and exchange, to support 
patient care. Thus, approaches where a qualified registry or QCDR 
obtains data from a MIPS eligible clinician's CEHRT using any of the 
wide range of ONC-adopted standards and then uses automated electronic 
systems to perform aggregation, calculation, filtering, and reporting 
would qualify each such measure for the CEHRT bonus point. In addition, 
measures submitted using the EHR submission mechanism or the EHR 
submission mechanism through a third party would also qualify for the 
CEHRT bonus.
    We request comment on this proposed approach.
(g) Calculating the Quality Performance Category Score
    The next two subsections provide a detailed description of how the 
quality performance category score would be calculated under our 
proposals.
(i) Calculating the Quality Performance Category Score for Non-APM 
Entity, Non-CMS Web Interface Reporters
    To calculate the quality performance category score, we propose at 
Sec.  414.1380(b)(1)(xv) to sum the weighted points assigned for the 
measures required by the quality performance category criteria plus the 
bonus points and divide by the weighted sum of total possible points.
    If a MIPS eligible clinician elects to report more than the minimum 
number of measures to meet the MIPS quality performance category 
criteria, then we would only include the scores for the measures with 
the highest number of assigned points. For example, if a patient facing 
MIPS eligible clinician's quality submission criteria is to report six 
measures with at least one cross-cutting measure and a high priority 
measure, and the MIPS eligible clinician reports eight process measures 
(three using CEHRT), one cross-cutting measure, and one outcome 
measure, then we propose to use the four process measures with the 
highest number of assigned points, plus the cross-cutting measure and 
the outcome measure, in addition to the two population-based measures 
(the all-cause readmission measure would not apply to an MIPS eligible 
clinician reporting individually), to calculate the quality performance 
category score. Allowing MIPS eligible clinicians to report additional 
measures without including them in the scoring allows MIPS eligible 
clinicians to become familiar with new measures and gain experience 
with those measures. It also provides the foundation for the MIPS 
eligible clinician to receive credit for improvement on those measures 
in future years.
    If a MIPS eligible clinician has met the quality performance 
category submission criteria for reporting quality information, but 
does not have any scored measures as discussed in section II.E.6.b.2., 
then a quality performance category score would not be calculated. 
Refer to section II.E.6.a.2.d. for details on how we propose to address 
scenarios where a quality performance category score is not calculated 
for a MIPS eligible clinician.
    The following example illustrates a sample scoring methodology. In 
this scenario, a MIPS eligible clinician submits individually via 
registry three process measures, one outcome measure, and one other 
high priority measure. Two of the process measures and one outcome 
measure qualify for

[[Page 28257]]

the CEHRT bonus. The patient facing MIPS eligible clinician did not 
submit on an expected cross-cutting measure and therefore would receive 
zero points for that requirement. Measures that do not meet the 
required case minimum or do not have a benchmark are not used for 
scoring. We reiterate that a measure that is not scored due to not 
meeting the required case minimum or lack of a measure benchmark would 
be treated differently than a required measure that is not reported. 
Any required measure that is not reported, or reported in a way that 
does not meet the data completeness requirements, would receive a score 
of zero points and be considered a scored measure. Table 19 illustrates 
the example.
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    The total possible points for the eligible clinician is 70 points. 
The eligible clinician has 48.2 points based on performance. The 
eligible clinician also qualifies for one bonus point for reporting an 
additional high priority patient safety measure and three bonus points 
for end-to-end electronic reporting of quality measures. The bonus 
points for high priority measures and CEHRT reporting are both under 
two separate caps which is 5 percent of 70 possible points or 3.5 
points per bonus category). The quality performance category score for 
this MIPS eligible clinician is (48.2 points + 4 bonus points = 52.2)/
70 total possible points = 74.6 percent. The quality performance 
category score would be capped at 100 percent.
    The following example in Table 20 illustrates how to calculate the 
bonus cap for the high priority measure bonus and the CEHRT bonus. In 
the scenario below, the MIPS eligible clinician has submitted six 
measures and would also be scored on two of the three population-based 
measures. The MIPS eligible clinician below successfully submitted five 
quality measures using end-to-end electronic reporting, and therefore, 
qualifies for the CEHRT bonus of one point for each of those measures. 
In addition to CEHRT bonus points, the MIPS eligible clinician reported 
outcome measures for high priority bonus points. The MIPS eligible 
clinician reported two outcome measures and receives two bonus points 
for the second outcome measure, given that no bonus points are given 
for the first required measure. However, both bonus categories are over 
the cap (which is 5 percent of 80 possible points or four points per 
bonus category). The quality performance category score for this MIPS 
eligible clinician is 68.8 (60.8 + 4 CEHRT bonus points after the cap + 
4

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high priority bonus points after the cap) or 86 percent (68.8/80). 
Note, in section II.E.5.b.(2), we propose to weight the quality 
performance category at 50 percent of the MIPS CPS, so an 86 percent 
quality performance category score would account for 50 percent of the 
CPS.
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    We request comment on our proposals to calculate the quality 
performance category score.
(ii) Calculating the Quality Performance Category for CMS Web Interface 
Reporters
    CMS Web Interface reporters have different quality performance 
category submission criteria; therefore, we propose to modify our 
scoring logic slightly to accommodate this submission mechanism. CMS 
Web Interface users report on the entire set of measures specified for 
that mechanism. Therefore, rather than scoring the top six reported 
measures, we propose to score all measures. If a group does not meet 
the reporting requirements for one of the measures, then the group 
would receive zero points for that measure. We note that since groups 
reporting through the Web Interface are required to report on all 
measures, and since some of those measures are ``high priority,'' these 
groups would always have some bonus points for the quality performance 
category score if all the measures are reported. That is, the group 
would either report on less than all web interface measures, in which 
case the group would receive zeros for unreported measures, or the 
group would report on all measures, in which case the group would 
automatically be eligible for bonus points. The other proposals for 
scoring discussed in section II.E.6.a.2.g.i., including bonus points, 
would still apply for CMS Web Interface. We request comment on this 
proposal.
(h) Measuring Improvement
    Section 1848(q)(3)(B) of the Act requires the Secretary, in 
establishing performance standards for measures and activities for the 
MIPS performance categories, to consider: Historical performance 
standards; improvement; and the opportunity for continued improvement. 
In addition, under section 1848(q)(5)(D) of the Act, beginning with the 
second year of the MIPS, if data sufficient to measure improvement are 
available, the CPS methodology shall take into account improvement of 
the MIPS eligible clinician in calculating the performance score for 
the quality and resource use performance categories and may take into 
account improvement for the CPIA and advancing care information 
performance categories.
    We are soliciting public comments on potential ways to incorporate 
improvement into the scoring methodology moving forward. We are 
especially interested in feedback on the following three options, with 
the assumption that eligible clinicians would report the same measures 
year-to-year (where possible). We are also interested in feedback on 
how to score improvement given that a MIPS eligible clinician can 
change measures and submission mechanisms from year-to-year. In 
addition, a MIPS eligible clinician can elect to report as an 
individual or a member of a group and that election can vary from year 
to year. Finally, we seek feedback on whether to score improvement 
where MIPS eligible clinicians do not have the required case minimum 
for measures to be scored.
    Option 1: We could adopt the approach for assessing improvement 
currently used for the HVBP, where we assign from 1-10 points for 
achievement and from 1-9 points for improvement for each measure. We 
would compare the achievement and improvement points for each measure 
in the quality performance category and score whichever is greater. 
Specifically, we would determine two scores for a MIPS eligible 
clinician at the measure level for the quality performance category. 
First, we would assess the MIPS eligible clinician's achievement score, 
which measures how the MIPS eligible clinician performed compared to 
benchmark performance scores for each applicable measure in the quality 
performance category. Second, we would assess the MIPS eligible 
clinician's improvement score, which measures how much a MIPS eligible 
clinician has improved compared to the MIPS eligible clinician's own 
previous performance during a baseline period for each applicable 
measure in the quality performance category. Under this methodology, we 
would compare the achievement and improvement scores for each measure 
and only use whichever is greater, but only those eligible clinicians 
with the top

[[Page 28259]]

achievement would be able to receive the maximum number of points. If a 
MIPS eligible clinician's practice was not open during the baseline 
period but was open during the performance period, points would be 
awarded based on achievement only for that performance period. For a 
more detailed description of the HVBP methodology, we refer readers to 
Sec.  412.160 and Sec.  412.165.
    Option 2: We could adopt the approach for assessing improvement 
currently used in the Shared Savings Program, where eligible clinicians 
or groups would receive a certain number of bonus points for the 
quality performance category for improvement, although the total points 
received for the performance may not exceed the maximum total points 
for the performance category in the absence of the quality improvement 
points. Under this methodology, we would score individual measures and 
determine the corresponding number of points that may be earned based 
on the MIPS eligible clinician's performance. We would add the points 
earned for the individual measures within the quality performance 
category and divide by the total points available for the performance 
category to determine the quality performance category score. MIPS 
eligible clinicians that demonstrate quality improvement on established 
quality measures from year-to-year would be eligible for up to four 
bonus points for the quality performance category. Bonus points would 
be awarded based on a MIPS eligible clinician's net improvement in 
measures within the quality performance category, which would be 
calculated by determining the total number of significantly improved 
measures and subtracting the total number of significantly declined 
measures. Up to four bonus points would be awarded based on a 
comparison of the MIPS eligible clinician's net improvement in 
performance on the measures to the total number of individual measures 
in the quality performance category. When bonus points are added to 
points earned for the quality measures in the quality performance 
category, the total points received for the quality performance 
category may not exceed the maximum total points for the performance 
category in the absence of the quality improvement points. For a more 
detailed description of the Shared Savings Program methodology, we 
refer readers to Sec.  425.502, as well as CY 2015 PFS final rule with 
comment (79 FR 67928-67931) for a discussion of how CMS will determine 
whether the improvement or decline is significant.
    Option 3: We could adopt the approach similar to that for assessing 
improvement for the Medicare Advantage 5-star rating methodology. Under 
this approach, we would identify an overall ``improvement measure 
score'' by comparing the underlying numeric data for measures from the 
prior year with the data from measures for the performance period. To 
obtain an ``improvement measure score'' MIPS eligible clinicians would 
need to have data for both years in at least half of the required 
measures for the quality performance category. The numerator for the 
overall ``improvement measure'' would be the net improvement, which is 
a sum of the number of significantly improved measures minus the number 
of significantly declined measures. The denominator is the number of 
measures eligible for improvement since to qualify for use in the 
``improvement measure'' calculation, a measure must exist in both years 
and not have had a significant change in its specification. This 
``improvement measure'' would be included in the quality performance 
category. We recognize that high performing MIPS eligible clinicians 
may have less room for improvement and consequently may have lower 
scores on the overall ``improvement measure''. Therefore, under this 
option we would propose the following rule, which is similar to how the 
5-star rating methodology treats highly rated plans in connection with 
the improvement measure to avoid penalizing consistently high-
performing eligible clinicians: We would calculate a MIPS eligible 
clinician's score with the ``improvement measure'' and without, and use 
the MIPS eligible clinician's best score. We request comments on these 
proposals.
(3) Scoring the Resource Use Performance Category
    As we described in section II.E.6.a.1. of this rule, we proposed to 
align scoring across the MIPS performance categories. For the resource 
use performance category, we propose to score the resource use measures 
similarly to the quality performance category. Specifically, we propose 
at Sec.  414.1380(b)(2) to assign one to ten points to each measure 
based on a MIPS eligible clinician's performance compared to a 
benchmark. However, we note that for the resource use performance 
category (unlike the quality performance category), the benchmark is 
based on the performance period, rather than the baseline period. The 
details of the scoring for resource use measures are described below.
(a) Resource Use Measure Benchmarks
    For the resource use performance category, we propose at Sec.  
414.1380(b)(2) that the performance standard is measure-specific 
benchmarks. We would calculate an array of measure benchmarks based on 
performance. Then, a MIPS eligible clinician's actual measure 
performance during the performance period would be evaluated to 
determine the number of points that should be assigned based on where 
the actual measure performance falls within these benchmarks.
    We propose at Sec.  414.1380(b)(2) to create benchmarks for the 
resource use measures based on the performance period. Changes in 
payment policies, including changes in relative value units, and 
changes that affect how hospitals, clinicians and other health care 
providers are paid under Medicare Parts A and B, can make it 
challenging to compare resource use in a performance period with a 
historical baseline period. In addition, for HVBP and VM, we use the 
performance period to establish the benchmarks for scoring HVBP's 
efficiency measures and VM's cost measures (80 FR 49562, 80 FR 71280). 
If we use the performance period, we would publish the benchmark 
methodology in a final rule, but would not be able to publish the 
actual numerical benchmarks in advance of the performance period. We 
believe that it is important for MIPS eligible clinicians to know in 
advance how they might be scored and can track their performance so we 
would continue to provide performance feedback with information on the 
MIPS eligible clinician's relative performance.
    We considered an alternative to base the resource use performance 
category measure benchmarks on the baseline period proposed in section 
II.E.6.a.1.c., rather than the performance period. This option would 
further align the resource use performance category benchmark 
methodology with the quality performance category benchmark 
methodology. This option would also allow us to publish the numerical 
benchmarks before the performance period ends; however, we believe the 
benefits of earlier published benchmarks are more limited for resource 
use measures. MIPS eligible clinicians would not be able to track their 
daily progress because they would not have all the necessary 
information to determine the attribution, price standardization, and 
otherwise adjust the measures. We believe the relative performance that 
we provide through

[[Page 28260]]

feedback reports would provide MIPS eligible clinicians the information 
they need to track performance and to learn about their resource 
utilization. In addition, we believe that using benchmarks based in the 
performance period is a better approach than using benchmarks based in 
the baseline period because different payment policies could apply 
during the baseline period than during the performance period which 
could affect a MIPS' eligible clinician's resource use. We would also 
have to identify the baseline benchmark and trend it forward so that 
the dollars in the baseline period are comparable to the performance 
period, whereas we would not have to make a trending adjustment for 
benchmarks based on the performance period. For these reasons, we 
elected to propose to base the benchmarks on the performance period 
rather than the baseline period.
    We propose to create a single set of benchmarks for each measure 
specified for the resource use performance category. All MIPS eligible 
clinicians that are attributed sufficient cases for the measure would 
be included in the same benchmark. In addition, we would require a 
minimum of 20 MIPS eligible clinicians or groups to be attributed the 
case minimum in order to develop the benchmark. If a measure does not 
have enough eligible clinicians or groups that are attributed enough 
cases to create a benchmark, then we would not include that measure in 
the scoring for the resource use performance category.
    We request comment on the proposal to establish resource use 
measure benchmarks based on the performance period as well as the 
alternative proposal.
(b) Assigning Points Based on Achievement
    For each set of benchmarks, we propose to calculate the decile 
breaks based on measure performance during the performance period and 
assign points for a measure based on which benchmark decile range the 
MIPS eligible clinician's performance on the measure is between. We 
propose that for resource use measures, lower costs represent better 
performance. In other words, MIPS eligible clinicians in the top decile 
would have the lowest resource use. We propose to use a methodology 
generally consistent with the methodology proposed for the quality 
performance category. We refer readers to Tables 21 and 22 for details 
on assigning points based on decile distribution. We request comments 
on the methodology for assigning points based on performance period 
deciles for the resource use performance category and solicit comments 
on alternative methodologies for assigning points for performance under 
this performance category for future rulemaking.
    Table 21 illustrates an example of using decile points along with 
partial points to assign achievement points for a sample resource use 
measure.
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(c) Case Minimum Requirements
    We seek to ensure that MIPS eligible clinicians are measured 
reliably; therefore, we proposed in section II.E.5.e.3. to establish a 
20 case minimum for each resource use measure. We note that this would 
include the Medicare Spending Per Beneficiary (MSPB) measure. In the CY 
2016 PFS final rule, we finalized a policy that increases the required 
case minimum for MSPB from 20 to 125 cases (80 FR 71295-71296). 
However, due to the proposed changes to the MSPB measure, discussed in 
section II.E.5.e.(3)(a)., we believe we can appropriately use a 
required case minimum of 20 for the revised MSPB measure. Refer to 
section II.E.5.e.(3) for our rationale for this proposal.
(d) Calculating the Resource Use Performance Category Score
    To calculate the resource use performance category score, we 
propose at Sec.  414.1380(b)(2)(iii) to average all the scores of all 
the resource use measures attributed to the MIPS eligible clinician. 
All measures in the resource use performance category as described in 
section II.E.5.e would be weighted equally. If a MIPS eligible 
clinician has only one resource use measure with a required case 
minimum to be scored, we would score that measure accordingly, and the 
MIPS eligible clinician's resource use performance category score would 
consist of the score for that one measure. We note that MIPS eligible 
clinicians cannot receive a zero score for any resource use measure for 
failure to submit the measure since none of the resource use 
performance category measures are submitted by MIPS eligible 
clinicians. Rather, these measures are attributed to MIPS eligible 
clinicians through claims data. However, if a MIPS eligible clinician 
is not attributed any resource use measures (for example, because the 
case minimum requirements have not been met for any measure or there is 
not a sufficient number of MIPS eligible clinicians to create a 
benchmark for any measure), then a resource use performance category 
score would not be calculated. Refer to section II.E.6.b for details on 
how we propose to address scenarios where a performance category score 
is not calculated for a MIPS eligible clinician. MIPS eligible 
clinicians would receive performance feedback as

[[Page 28261]]

required under section 1848(q)(12) of the Act and discussed in section 
II.E.8.a of this proposed rule. Over time, performance feedback may 
include a list of attributed cases for each measure by MIPS eligible 
clinician. We request comment on our proposals to calculate the 
resource use performance category score.
    Table 22 illustrates a sample scoring methodology for a limited set 
of measures. A MIPS eligible clinician is attributed resource use 
measures as described above and receives a score for measures where the 
eligible clinician has a sufficient number of cases attributed.
    The MIPS eligible clinician described in Table 22 did not have the 
required case minimum for Measure 4 (Episode 2), and therefore is not 
scored on this measure. Similarly, the MIPS eligible clinician was not 
attributed any cases for Measure 5 (Episode 3) and was not scored on 
the measure. Measures that do not meet the required case minimum are 
not used for scoring.
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    In the example above, making the assumption that all measures 
listed have a median performance falling between the fifth and sixth 
deciles and would provide a score of six points, the MIPS eligible 
clinician with a value above the median would receive a score lower 
than six points. For example, Measure 1 has a performance of $15,000 
which is higher than the median performance of $13,000, therefore the 
number of points assigned (4.0) is lower than six points.
    Based on the resource use measures available for scoring, the MIPS 
eligible clinician is scored against the total number of points 
available. The resource use performance category score for this 
eligible clinician is (22.3 performance points/40 possible points) = 
55.8 percent.
    Unlike the quality performance category score, we are not proposing 
bonus points as part of the resource use performance category score.
(4) Scoring the CPIA Performance Category
    Section 1848(q)(5)(C) of the Act outlines specific scoring rules 
for the CPIA performance category. Section 1848(q)(5)(C)(i) of the Act 
provides that a MIPS eligible clinician who is in a practice that is 
certified as a patient-centered medical home or comparable specialty 
practice with respect to a performance period shall receive the highest 
potential score for the CPIA performance category for such period. 
Section 1848(q)(5)(C)(ii) of the Act provides that MIPS eligible 
clinicians participating in an APM with respect to a performance period 
shall earn a minimum score of one-half of the highest potential score 
for the CPIA performance category for such period. We refer readers to 
section II.E.5.h of this preamble for a description of the APM scoring 
standard. Section 1848(q)(5)(C)(iii) of the Act states that MIPS 
eligible clinicians are not required to perform activities in each 
subcategory or participate in an APM in order to receive the highest 
possible score for the CPIA performance category. Based on these 
criteria, we propose a scoring methodology that assigns points for the 
CPIA performance category (based on patient-centered medical home 
participation and the CPIAs reported by the MIPS eligible clinician). A 
MIPS eligible clinician's performance would be evaluated by comparing 
the reported CPIAs to the highest possible score.
(a) Assigning Points to Reported CPIAs
    CPIA is a new performance category that has not been implemented in 
our previous programs. Therefore, in year 1, we cannot assess how well 
the MIPS eligible clinician has performed on the activity against data 
from a baseline year. We can only assess whether the MIPS eligible 
clinician has participated sufficiently to receive credit in the CPIA 
performance category. Therefore, we propose at Sec.  414.1380(b)(3) to 
assign points for each reported activity within two categories: Medium-
weighted and high-weighted activities. Medium-weighted activities are 
worth 10 points. High-weighted activities are worth 20 points. Table 23 
lists all of the proposed CPIAs that are high-weighted. All other 
activities not listed as high-weighted activities would be considered 
medium activities. Table H in the Appendices provides the CPIA 
Inventory of all activities, both medium-weighted and high-weighted. 
Consistent with our unified scoring system principles, MIPS eligible 
clinicians would know in advance how many potential points they could 
receive for each CPIA.
    Activities are proposed to be weighted as high based on the extent 
to which they align with activities that support the patient-centered 
model home, since that is the standard under section 1848(q)(5)(C)(i) 
of the Act for achieving the highest potential score for the CPIA 
performance category, as well as with CMS priorities for transforming 
clinical practice. Additionally, activities that require performance of 
multiple actions, such as participation in the

[[Page 28262]]

Transforming Clinical Practice Initiative, participation in a MIPS 
eligible clinician's state Medicaid program, or an activity identified 
as a public health priority (such as emphasis on anticoagulation 
management or utilization of prescription drug monitoring programs) are 
justifiably weighted as high. We seek comment on which activities 
should receive a high weight as opposed to a medium weight.
    We also considered an approach of equal weighting for all CPIAs. We 
seek comment on a multi-tier weighting approach such as low, medium and 
high activity categories for future years of MIPS.
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(b) CPIA Performance Category Highest Potential Score
    Although there is variability in the level that each MIPS eligible 
clinician would perform a CPIA, we currently do not have a standard way 
of measuring that variability. In future years, we plan to capture data 
to begin to develop a baseline for measuring CPIA improvement. Because 
we cannot measure variable performance within a CPIA, we propose at 
Sec.  414.1380(b)(3)(v) to compare the points associated with the 
reported activities against the highest potential score. We propose the 
highest potential score to be 60 points for the CY 2017 performance 
period given the following rationale.
    Based on discussions with several high performing organizations, we 
believe that MIPS eligible clinicians would be able to report on as 
many as six activities of medium weight. Examples of these 
organizations include one that led a major redesign of patient workflow 
after Hurricane Katrina, implementing clinical practice improvements to 
ensure patients receive faster treatment in the event of future 
disasters, ranked nationally in 6 adult specialties and high-performing 
in 6

[[Page 28266]]

adult specialties; \16\ a second that was recognized by a leading 
medical association that achieved: 6.7 percent 30-day all cause 
readmissions, 42 percent fewer ED visits with implementation of a 60-
day intensive home care program, costs of 15 percent-28 percent below 
regional average and significant improvement in patient surveys from 
CAHPS; \17\ and a third recognized as a leader in rural health with the 
highest award for excellence from the National Rural Primary Care 
Association.
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    \16\ U.S. News and World Report 2015-2016 Best Hospitals 
Ranking. Retrieved from https://www.ochsner.org/patients-visitors/about-us/outcomes-and-honors/us-news-and-world-report.
    \17\ California Association of Physicians Groups in Medicare 
Advantage (2014). Retrieved from http://www.ehcca.com/presentations/capgma1/cohen_b2.pdf.
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    We also believe that a top performing small practice (consisting of 
15 or fewer professionals) or practice in a rural or health 
professional shortage area, or a non-patient facing MIPS eligible 
clinician would be able to report on at least two activities. In 
consideration of special circumstances for these small practices, as 
well as practices located in rural areas and in Health Professional 
Shortage Areas (HPSAs) or non-patient facing MIPS eligible clinicians, 
we propose that the weight for any activity selected would be 30 
points. For any MIPS eligible clinician, the maximum total points 
achievable in this performance category is 60 points. Based on the 
above rationale, we believe it is reasonable to expect all MIPS 
eligible clinicians to be able to report CPIAs, and as such, a MIPS 
eligible clinician reporting no CPIA would receive a zero score for the 
CPIA performance category. We believe this proposal allows us to 
capture variation in reporting the CPIA performance category.
(c) Points for Certified Patient-Centered Medical Home or Comparable 
Specialty Practice
    Section 1848(q)(5)(C)(i) of the Act specifies that a MIPS eligible 
clinician who is in a practice that is certified as a patient-centered 
medical home or comparable specialty practice, as determined by the 
Secretary, with respect to a performance period must be given the 
highest potential score for the CPIA performance category for the 
performance period. We propose that patient-centered medical home 
practices are those that have received accreditation from any of the 
following four nationally recognized accreditation organizations (the 
Accreditation Association for Ambulatory Health Care, the National 
Committee for Quality Assurance (NCQA), The Joint Commission, and the 
Utilization Review Accreditation Commission (URAC)); \18\ or are a 
Medicaid Medical Home Model or Medical Home Model. We propose that 
CMS's proposed comparable specialty practices are those that include 
the NCQA Patient-Centered Specialty Recognition. We refer readers to 
section II.F. of this proposed rule for further description of the 
Medicaid Medical Home Model or Medical Home Model. The four 
accreditation organizations listed above all have evidence of being 
used by a large number of medical organizations as the model for their 
patient-centered medical home and are national in scope. No other 
criteria are required for receiving recognition as a certified patient 
patient-centered medical home or comparable specialty practice except 
for being recognized by one of the above organizations.
---------------------------------------------------------------------------

    \18\ The name was officially shortened to URAC in 1996.
---------------------------------------------------------------------------

    Section II.E.5.f. of this rule outlines the policy for certified 
patient-centered medical homes. The organizations identified above 
maintain a list of certified patient-centered medical homes, including 
the Medicaid Medical Home and Medical Home Models, that would be used 
to determine whether a MIPS eligible clinician qualifies for the 
highest potential score for the CPIA performance category because the 
MIPS eligible clinician is in a certified patient-centered medical 
home. NCQA maintains a list of practices that have received the 
Patient-Centered Specialty Recognition which would be used to determine 
whether a MIPS eligible clinician qualifies for the highest potential 
score for the CPIA performance category because the MIPS eligible 
clinician is in a comparable specialty practice.
    We propose at Sec.  414.1380(b)(3) that a MIPS eligible clinician 
who is in a practice that is certified as a patient-centered medical 
home, including a Medicaid Medical Home or Medical Home Model, or 
comparable specialty practice in accordance with those proposals would 
receive the highest potential score (in accordance with section 
1848(q)(5)(C)(i) of the Act) of 60 points for the CPIA performance 
category.
    (1) Section II.E.5.f. of this rule presents the CMS Study on CPIA 
and Measurement. Given the burden for participants completing the year-
long study and the value of collectively examining innovation and 
practice activities to improve clinical quality data submissions and 
further reduce time requirements for eligible clinicians and groups to 
report, we propose that MIPS eligible clinicians and groups that 
successfully participate and submit data to fulfill study requirements 
would receive the highest potential score of 60 points for the CPIA 
performance category.
(d) Calculating the CPIA Performance Category Score
    To determine the CPIA performance category score, we propose to sum 
the points for all of the MIPS eligible clinician's reported activities 
and divide by the proposed CPIA performance category highest potential 
score of 60. A perfect score would be 60 points divided by 60 possible 
points, which equals 100 percent. If MIPS eligible clinicians have more 
than 60 CPIA points, then we propose to cap the resulting CPIA 
performance category score at 100 percent.
    Table 24 illustrates a sample scoring methodology for the CPIA 
performance category. The MIPS eligible clinician below was not an APM 
participant and does not immediately earn the minimum score of one-half 
of the highest potential score or 30 points that are available for APM 
participation. The MIPS eligible clinician below completed two high-
weighted activities worth 20 points each and two medium-weighted 
activities for 10 points each in order to receive the maximum 60 points 
available in the performance category for a CPIA performance category 
score of 100 percent.

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[GRAPHIC] [TIFF OMITTED] TP09MY16.029

    Alternatively, the MIPS eligible clinician could have selected 
three high-weighted activities for 20 points each, six medium-weighted 
activities for ten points each, or some combination to reach 60 points. 
The score however is capped at 100 percent (60/60). This means that a 
MIPS eligible clinician who selects four high-weight activities (80 
possible points) would still be given a score of 100 percent (60/60).
    Section 1848(q)(2)(B)(iii) of the Act requires the Secretary to 
give consideration to the circumstances of small practices (consisting 
of 15 or fewer professionals) and practices located in rural areas and 
in geographic health professional shortage areas (HPSAs) (as designated 
under section 332(a)(1)(A) of the Public Health Service Act) in 
defining activities. Section 1848(q)(2)(C)(iv) of the Act also requires 
the Secretary to give consideration to non-patient-facing MIPS eligible 
clinicians. Further, section 1848(q)(F)(5) of the Act allows the 
Secretary to assign different scoring weights for measures, activities, 
and performance categories, if there are not sufficient measures and 
activities applicable and available to each type of eligible clinician.
    For MIPS eligible clinicians and groups that are small practices 
(consisting of 15 or fewer professionals), practices located in rural 
areas, practices located in geographic HPSAs, or non-patient facing 
MIPS eligible clinicians or non-patient facing MIPS eligible clinician 
groups, we propose alternative scoring requirements for the CPIA 
performance category. The rationale for this alternative scoring is 
grounded in the resource constraints these MIPS eligible clinicians 
face which was further discovered during listening sessions with small, 
rural and geographic HPSAs and medical societies for non-patient facing 
MIPS eligible clinicians and groups. We believe that while non-patient 
facing MIPS eligible clinicians and non-patient facing groups could 
select activities from some sub-categories (such as care coordination 
and patient safety), for other sub-categories (such as beneficiary 
engagement and population management) non-patient facing MIPS eligible 
clinicians and groups will need to consider novel practice activities 
that are within their scope and can improve beneficiary care. We will 
continue to work with non-patient facing MIPS eligible clinician 
professional organizations to further develop activities relevant for 
these clinicians in future years. Our rationale for small practices and 
practices located in rural areas and in HPSAs is grounded in the 
resource constraints that these MIPS eligible clinicians face. This 
rationale is especially compelling given that each activity requires at 
least 90 days and may not necessarily be conducted in parallel, with 
time allocated to pre-planning and post-planning, which would impact 
the practice's limited resources.
    All MIPS eligible clinicians would be allowed to self-identify as 
part of an APM, a patient-centered medical home or comparable specialty 
practice, a Medicaid Medical Home or Medical Home Model, a non-patient 
facing professional, a small practice (consisting of 15 or fewer 
professionals), a practice located in a rural area, or a practice in a 
geographic HPSA or any combination thereof as applicable during 
attestation following the performance period. We refer readers to 
https://innovation.cms.gov/Medicare-Demonstrations/Medicare-Medical-Home-Demonstration.html for more information on the Medical Home Model.
    We would validate these self-identifications as appropriate. We 
propose that the following scoring would apply to MIPS eligible 
clinicians who are a non-patient facing professional, a small practice 
(consisting of 15 or fewer professionals), a practice located in a 
rural area, or practice in a geographic HPSA or any combination 
thereof:
     Reporting of one medium-weighted or high-weighted activity 
would result in 50 percent of the highest potential score.
     Reporting of two medium-weighted or high-weighted 
activities would result in 100 percent of the highest potential score.
    In future years, we may adjust the weighting of activities at the 
MIPS eligible clinician level based on initial patterns of CPIA 
reporting. For example, if a MIPS eligible clinician reports on the 
same medium-weighted activity over several performance periods, in a 
subsequent year that MIPS eligible clinician may not be allowed to 
continue to select that same activity. This is because the intent of 
the CPIA performance category is to demonstrate improvement over time 
and not just demonstrate same benefit from year to year. For example, 
continuing to provide expanded practice access does not demonstrate 
improvement over time. Further, should the weighting of activities 
change in future years, we may also adjust the CPIA performance 
category point target accordingly. We request comment on our proposed 
approach to score the CPIA performance category. We also seek comment 
on alternative methodologies for the CPIA performance category. We seek 
to assure equity in scoring MIPS eligible clinicians while still 
considering activity variation, impact and burden.
(5) Scoring the Advancing Care Information Performance Category
    We refer readers to section II.E.5.g.6. for our proposed 
methodology for scoring the advancing care information performance 
category. We reiterate that this methodology has many of the features 
of the unified scoring system described above. Specifically, we are 
moving away from the ``all-or-nothing'' scoring approach of the 
Medicare EHR Incentive Program. In addition, MIPS

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eligible clinicians would know in advance what they have to do to 
achieve points under the advancing care information performance 
category in MIPS. We provide a brief summary of our proposed scoring 
methodology here.
    In the advancing care information performance category, we propose 
to score for both participation and performance. We refer to these 
scoring methods as the ``base score'' and the ``performance score''.
    To earn points toward the base score, a MIPS eligible clinician or 
group must report the numerator and denominator (or yes/no statement as 
applicable) for certain measures adopted by the EHR Incentive Programs 
in the 2015 EHR Incentive Programs Final Rule to achieve 50 percent of 
the total advancing care information performance category score. For 
measures that previously included a percentage-based threshold, we are 
not requiring MIPS eligible clinicians or groups to meet those 
thresholds. Instead we propose to require eligible clinicians and 
groups to report the numerator (of at least one) and denominator (or a 
yes/no statement for applicable measures) for each measure being 
reported.
    For the base score, MIPS eligible clinicians or groups must meet 
Objective 1: Protect Patient Health Information and its associated 
measure in 2015 EHR Incentive Programs Final Rule. Additionally, 
eligible clinicians would be required to report the numerator and 
denominator, or a yes/no statement as appropriate, for each measure for 
Electronic Prescribing, Patient Electronic Access to Health 
Information, Coordination of Care Through Patient Engagement, Health 
Information Exchange, and Public Health and Clinical Data Registry 
Reporting-- as adopted in the 2015 EHR Incentive Programs Final Rule. 
Failure to meet any of the objectives would result in a base score of 
zero and an advancing care information performance category score of 
zero.
    For the Public Health and Clinical Data Registry Reporting 
objective, an eligible clinician or group is only required to report on 
the Immunization Registry Reporting measure. Completing any additional 
measures under the objective would earn one additional bonus point 
after calculation of the performance score.
    The performance score is then determined in addition to the base 
score. The performance score methodology would implement a decile scale 
for the application of additional points based on performance in the 
objectives and measures for Patient Electronic Access, Coordination of 
Care through Patient Engagement, and Health Information Exchange. There 
are eight associated measures under these three objectives; each has a 
maximum of ten percentage points available. The total available 
performance score would be 80 percent which is, in combination with the 
base score of 50 percent, greater than the total possible performance 
category score of 100 percent. We have taken this approach in order to 
provide flexibility toward achieving the maximum score in the advancing 
care information performance category--however, a MIPS eligible 
clinician or group's score is capped at 100 percent.
    This summary only represents the primary advancing care information 
performance category scoring proposal. For full details on the 
advancing care information performance category scoring and an 
explanation of alternatives considered, as well as accommodation for 
eligible clinicians planning to report Modified Stage 2 or use 2014 
Edition CEHRT in 2017 please refer to II.E.5.g.4.
b. Calculating the Composite Performance Score (CPS)
    Section II.E.6.a. of this rule describes our proposed methodology 
for assessing and scoring MIPS eligible clinician performance for each 
of the four performance categories. In this section, we propose the 
methodology to determine the CPS based on the scores for each of the 
four performance categories. We define at Sec.  414.1305 the CPS as a 
composite assessment (using a scoring scale of 0 to 100) for each MIPS 
eligible clinician for a specific performance period determined using 
the methodology for assessing the total performance of each MIPS 
eligible clinician according to the performance standards with respect 
to the applicable measures and activities for each applicable 
performance category. The CPS is the sum of the products of each 
performance category score and each performance category's assigned 
weight multiplied by 100.
(1) Formula To Calculate the CPS
    Section 1848(q)(5)(A) of the Act requires the Secretary to develop 
a methodology for assessing the total performance of each MIPS eligible 
clinician according to the performance standards with respect to the 
applicable measures and activities with respect to each performance 
category applicable to such clinician for a performance period, and 
using the methodology, provide for a CPS (using a scoring scale of 0 to 
100) for each MIPS eligible clinician for the performance period. 
Additionally, sections 1848(q)(5)(E) and (F) of the Act address the 
weights for each of the performance categories in the CPS.
    To create a CPS from 0-100 based on the individual performance 
category scores, we propose to multiply the score for each performance 
category by the assigned weight for the performance category. We 
provide in Table 25 the weights for each performance category for the 
2019, 2020 and 2021 MIPS payment years. The resulting weighted 
performance category scores would be summed to create a single CPS. As 
described in section II.E.2 of this preamble, we propose that the 
identifier for MIPS performance would be the same for all four 
performance categories, and therefore, the methodology to calculate a 
CPS would be the same for both individual and group performance.
    The following equation summarizes the proposed CPS calculation at 
Sec.  414.1380(c):
    CPS = [(quality performance category score x quality performance 
category weight) + (resource use performance category score x resource 
use performance category weight) + (CPIA performance category score x 
CPIA performance category weight) + (advancing care information 
performance category score x advancing care information performance 
category weight)] x 100.
(a) Accounting for Risk Factors
    Section 1848(q)(1)(G) of the Act requires us to consider risk 
factors in our scoring methodology. Specifically, that section provides 
that the Secretary, on an ongoing basis, shall, as the Secretary 
determines appropriate and based on individuals' health status and 
other risk factors, assess appropriate adjustments to quality measures, 
resource use measures and other measures used under MIPS and assess and 
implement appropriate adjustments to payment adjustments, CPSs, scores 
for performance categories or scores for measures or activities under 
the MIPS. In doing this, the Secretary is required to take into account 
the relevant studies conducted and recommendations made in reports 
under section 2(d) of the Improving Medicare Post-Acute Transformation 
(IMPACT) Act of 2014 and, as appropriate, other information, including 
information collected before completion of such studies and 
recommendations. HHS' Office of the Assistant Secretary for Planning 
and Evaluation (ASPE) is conducting studies and making recommendations 
on the issue of risk adjustment for socioeconomic status on quality 
measures and resource use as required by section 2(d) of the IMPACT Act 
and

[[Page 28269]]

expects to issue a report to Congress by October 2016. We will closely 
examine the recommendations issued by ASPE and incorporate them as 
feasible and appropriate through future rulemaking. We also note that 
several MIPS measures, as appropriate, include risk adjustment in their 
measure specifications. For example, outcome measures in the quality 
performance category generally have risk adjustment embedded in the 
measure calculation specification, while process measures generally do 
not. Similarly, in the resource use performance category, the proposed 
total per capita costs for all attributed beneficiaries measure is 
adjusted for demographic and clinical factors. That measure also has a 
specialty adjustment that is applied after the measure calculation to 
account for differences in specialty mix within a practice. The MSPB 
measure and other resource use measures have different risk adjustments 
that are specific to the individual measure. For the first year of 
MIPS, for the quality and resource use performance categories, we 
propose to use the measure-specific risk adjustment for all measures 
(where applicable), as well as the additional specialty adjustment for 
the total per capita costs for all attributed beneficiaries.
    We invite public comments on this proposal.
(2) CPS Performance Category Weights
(a) General Weights
    Section 1848(q)(5)(E)(i) of the Act specifies weights for the 
performance categories included in the MIPS CPS: In general, 30 percent 
for the quality performance category, 30 percent for the resource use 
performance category, 25 percent for the advancing care information 
performance category, and 15 percent for the CPIA performance category. 
However, that section also specifies different weightings for the 
quality and resource use performance categories for the first and 
second years for which the MIPS applies to payments. Section 
1848(q)(5)(E)(i)(II)(bb) of the Act specifies that for year 1, not more 
than 10 percent of the CPS will be based on the resource use 
performance category and for year 2, not more than 15 percent will be 
based on resource use performance category. Under section 
1848(q)(5)(E)(i)(I)(bb) of the Act, the weight of the quality 
performance category for each of the first two years will increase by 
the difference of 30 percent minus the weight specified for the 
resource use performance category for the year.
    In previous sections of this rule, we have proposed the performance 
category weights for the first MIPS payment year of 2019. In section 
II.E.5.e.2., we propose to set the resource use performance category 
weight at 10 percent for the 2019 payment year and 15 percent for the 
2020 payment year. Correspondingly, in section II.E.5.b.2., we propose 
to set the quality performance category weight to 50 percent for the 
2019 payment year and 45 percent for the 2020 payment. The quality 
performance category weight proposal is based on the 30 percent 
required by statute for the quality performance category plus 30 
percent minus the weight of the resource use performance category, as 
required by section 1848(q)(5)(E)(i)(I)(bb) of the Act. As specified in 
section 1848(q)(5)(E)(i) of the Act, the weights for the other 
performance categories are 25 percent for the advancing care 
information performance category; and 15 percent for the CPIA 
performance category. Section 1848(q)(5)(E)(ii) of the Act provides 
that in any year in which the Secretary estimates that the proportion 
of eligible professionals (as defined in section 1848(o)(5) of the Act) 
who are meaningful EHR users (as determined under in section 1848(o)(2) 
of the Act) is 75 percent or greater, the Secretary may reduce the 
applicable percentage weight of the advancing care information 
performance category in the CPS, but not below 15 percent, and adjust 
the weighting of the other performance categories. We refer readers to 
our proposals concerning section 1848(q)(5)(E)(ii) of the Act in 
section II.E.5.g.(6)(e).
    Table 25 summarizes the weights specified for each performance 
category under section 1848(q)(5)(E)(i) of the Act and in accordance 
with our proposals.
[GRAPHIC] [TIFF OMITTED] TP09MY16.030

(b) Flexibility for Weighting Performance Categories
    Under section 1848(q)(5)(F) of the Act, if there are not sufficient 
measures and activities applicable and available to each type of 
eligible clinician involved, the Secretary shall assign different 
scoring weights (including a weight of zero) for each performance 
category based on the extent to which the category is applicable and 
for each measure and activity based on the extent to which the measure 
or activity is applicable and available to the type of eligible 
clinician involved.
    In section II.E.6.a and section II.E.5.g.8., we describe scenarios 
where certain MIPS eligible clinicians might not receive a performance 
category score in the quality, resource use, or advancing care 
information performance categories. We propose that in such scenarios 
we would use the authority under section 1848(q)(5)(F) of the Act to 
assign a weight of zero to the performance category and redistribute 
the weight for that performance category or categories as described in 
the next section.
    For the quality and resource use performance categories, we believe 
having sufficient measures applicable

[[Page 28270]]

and available means that we are able to reliably calculate a score for 
the measures that adequately captures and reflects the performance of 
the MIPS eligible clinician. For the quality and resource use 
performance categories, we propose in sections II.E.6.a.2.d., 
II.E.6.3.a., and II.E.6.a.3.d. that we would not calculate a 
performance category score if a MIPS eligible clinician does not have 
any measures with the required case minimum or any measures with a 
sufficient number of MIPS eligible clinicians to create a benchmark. 
Measures that do not meet the required case minimum or a sufficient 
number of MIPS eligible clinicians to create a benchmark would be 
excluded from scoring, and the MIPS eligible clinician would not 
receive a quality or resource use performance category score. (Note, 
this situation is different from a MIPS eligible clinician who elects 
not to submit any quality measures. A MIPS eligible clinician who 
elects not to submit any quality measures would receive a quality 
performance category score of zero.) We believe MIPS eligible 
clinicians who would have no scored measures for a performance category 
under our proposals would not have sufficient measures applicable and 
available for that performance category.
    For the quality performance category, we anticipate that most MIPS 
eligible clinicians would select the measures most relevant to their 
practice and that in most cases, the measures they select would meet 
the required case minimum. We plan to monitor measure selection trends 
under the performance category and will revise this policy if it 
appears MIPS eligible clinicians are reporting measures that are not 
relevant to their practice or measures that do not meet the required 
case minimum. In the resource use performance category, we believe MIPS 
eligible clinicians who are not attributed enough cases to be reliably 
measured should not be scored for the performance category. We have 
proposed to include many resource use measures that we believe are 
sufficiently developed and ready for evaluating resource use by MIPS 
eligible clinicians; however, if a MIPS eligible clinician is not 
attributed any (or very few) cases for the measure, then we do not 
believe the MIPS eligible clinician should be measured on performance.
    We refer readers to section II.E.5.g.8. of this proposed rule for a 
detailed discussion of the scenarios in which a MIPS eligible clinician 
may not have sufficient measures applicable and available under the 
advancing care information performance category. For the CPIA 
performance category, however, we envision that all MIPS eligible 
clinicians would have sufficient activities applicable and available 
and do not propose any scenario where a MIPS eligible clinician would 
not receive a CPIA performance category score.
    In addition to scenarios where a MIPS eligible clinician would have 
no scored measures for a performance category, we believe there may be 
scenarios in which a MIPS eligible clinician would have too few scored 
measures under the quality performance category for us to reliably 
calculate a performance category score that is worth half the weight of 
the CPS for the 2019 MIPS payment year. We propose that if a MIPS 
eligible clinician has fewer than three scored quality measures (either 
submitted measures or measures calculated from administrative claims 
data) for a performance period, we would consider the MIPS eligible 
clinician not to have a sufficient number of measures applicable and 
available for the 2019 MIPS payment year quality performance category 
weight and would therefore lower the weight of the quality performance 
category. In this situation, the MIPS eligible clinician has a quality 
performance category score, but has data for only one or two scored 
measures, which is not a sufficient number of measures for the quality 
performance category because the quality performance category would 
constitute half of the CPS for the 2019 MIPS payment year. In addition, 
as described in the next section, for MIPS eligible clinicians that are 
not scored on the resource use or advancing care information 
performance category, we propose to increase the weight of the quality 
performance category. For these reasons, we believe that for the first 
year of MIPS, the quality performance category requires a sufficient 
number of measures to justify its weight in the CPS. We will reconsider 
this policy in future years as the weights for the performance 
categories change. We may consider implementing a similar policy for 
the resource use performance category for future years, but not for the 
first year of MIPS based upon the lower weighting of the resource use 
performance category.
    In section II.E.5.b., we are proposing for the quality performance 
category, generally, that MIPS eligible clinicians submit a minimum of 
six measures for scoring in MIPS. In addition, we propose to include up 
to three population-based measures derived from claims data. As 
described in section II.E.6.a.2., a MIPS eligible clinician may submit 
a measure that is not scored, either because the measure did not meet 
the required case minimum to be reliably measured or because fewer than 
20 MIPS eligible clinicians with sufficient volume submitted a measure 
through a similar reporting mechanism and a benchmark could not be 
created for the performance or baseline period. We reiterate that a 
measure that is not scored due to not meeting the required case minimum 
or lack of a measure benchmark, is different than a required measure 
that is not reported. Any required measure that is not reported or 
reported with in a way that does not meet the data completeness 
requirements would receive a score of zero points and would be 
considered a scored measure.
    We are concerned that if a large percentage of the expected 
measures are not able to be scored due to not meeting the required case 
minimums or a missing benchmark, then just one or two measures would 
contribute disproportionately to the CPS because the quality 
performance category score is worth 30 to 50 percent (depending on the 
year) of the CPS under section 1848(q)(5)(E)(i) of the Act. We do not 
believe a score for one or two quality measures can capture all the 
elements of quality performance during a performance period. We believe 
the lack of a sufficient number of measures for scoring limits the 
value of quality performance measurement toward the CPS. Therefore, we 
propose that if a MIPS eligible clinician has only two scored measures 
(including both submitted measures and measures derived from 
administrative claims data) to reduce the weight of the quality 
performance category by one-fifth (for example, from 50 percent to 40 
percent in year 1) and redistribute the weight (for example, 10 percent 
in year 1) proportionately to the other performance categories for 
which the MIPS eligible clinician did receive a performance category 
score. If a MIPS eligible clinician has only one scored quality 
measure, then we propose to reduce the weight of the quality 
performance category by two-fifths (for example, from 50 percent to 30 
percent in year 1) and redistribute the weight (for example, 20 percent 
in year 1) proportionately to the other performance categories for 
which the MIPS eligible clinician did receive a performance category 
score. Lowering the weight of the quality performance category would be 
consistent with the relatively low percentage of expected quality 
measures that are able to be scored.
    We request comment on these proposals to identify MIPS eligible 
clinicians without sufficient measures and activities applicable and 
available

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and our proposals to reweight those performance categories. We also 
seek comment on alternative methods for reweighting performance 
categories for MIPS eligible clinicians without sufficient measures and 
activities in certain performance categories. We seek to ensure that 
reweighting would not cause an eligible clinician to be either 
advantaged or disadvantaged due to a lack of sufficient measures and 
activities applicable and available, and a corresponding inability to 
generate a score for a certain performance category.
(c) Redistributing Performance Category Weights
    We propose at Sec.  414.1380(c)(3) to reweight the performance 
categories for MIPS eligible clinicians when there are not sufficient 
measures and activities applicable and available to them. We propose to 
reweight the performance categories in the following situations.
    If the MIPS eligible clinician does not receive a resource use or 
advancing care information performance category score, and has at least 
three scored measures (either submitted measures or those calculated 
from administrative claims) in the quality performance category, then 
we propose to reassign the weights of the performance categories 
without a score to the quality performance category. We believe this 
policy is appropriate for several reasons. First, section 
1848(q)(5)(E)(i)(I)(bb) of the Act redistributes weight from the 
resource use performance category to the quality performance category 
in the first two years of MIPS. This proposal is consistent with that 
redistribution logic. In addition, MIPS eligible clinicians have 
experience reporting quality measures through the PQRS program and 
measurement in this performance category is more mature. Finally, for 
the 2019 MIPS payment year, quality performance would be worth at least 
half of the CPS. By requiring the MIPS eligible clinician to have at 
least three scored quality measures, we believe the quality performance 
category would be robust enough to support more weight reassigned to it 
than other performance categories. We may revisit this policy in future 
years as the weight for the resource use performance category increases 
and the weight for the quality performance category decreases.
    We also propose an alternative that does not reassign all the 
weight to the quality performance category, but rather reassigns the 
weight proportionately to each of the other performance categories for 
which the MIPS eligible clinician has received a performance category 
score.
    We request public comments on the proposal to reassign the weights 
to the quality performance category, as well as the alternate proposal 
to redistribute proportionately to other performance categories.
    If the MIPS eligible clinicians have fewer than three scored 
measures in the quality performance category score, then we propose to 
reassign the weights for the performance categories without scores 
proportionately to the other performance categories for which the MIPS 
eligible clinician has received a performance category score. We 
request comment on this proposal.
    Finally, because the CPS is a composite score, we believe the 
intention of section 1848(q)(5) of the Act is for MIPS eligible 
clinicians to be scored based on multiple performance categories. 
Basing a CPS on a single performance category, even a robust and 
familiar performance category like quality, would frustrate that 
intent. In our proposals, CPIA is the only performance category which 
would always have a performance category score. We are particularly 
concerned about the possibility that a MIPS eligible clinician might, 
for the reasons discussed above, not have sufficient measures 
applicable and available for the quality, resource use, and advancing 
care information performance categories, and would only receive a score 
for the CPIA performance category. The CPIA performance category is 
based on activities that are reported by attestation, not on measured 
performance. In addition, because CPIA is not as mature as the other 
performance categories, each of which include certain aspects of 
existing CMS programs, we are unsure how much variation we will have in 
the CPIA performance category. We do not think it would be equitable to 
allow MIPS eligible clinicians that attest to receive the maximum 
points for that performance category and then base the CPS solely on 
the CPIA performance category. Such a scenario may result in higher CPS 
and payment adjustment factors for some MIPS eligible clinicians based 
solely on the CPIA performance category, while other MIPS eligible 
clinicians are measured based on their performance under the other 
performance categories. Therefore, we propose that if a MIPS eligible 
clinician receives a score for only one performance category, we would 
assign the MIPS eligible clinician a CPS that is equal to the 
performance threshold described in section II.E.5., which means the 
eligible clinician would receive a MIPS adjustment factor of 0 percent 
for the year. We anticipate this proposal would affect very few MIPS 
eligible clinicians in year 1 and even fewer in future years as more 
eligible clinicians are able to report on and receive scores for more 
of the performance categories.
    We welcome public comment on this proposal.
7. MIPS Payment Adjustments
a. Payment Adjustment Identifier and CPS Used in Payment Adjustment 
Calculation
i. Payment Adjustment Identifier
    As we describe in section II.E.2 of this preamble, we propose to 
allow MIPS eligible clinicians to measure performance as an individual, 
as a group defined by TIN, or as an APM Entity group using the APM 
scoring standard, yet for purposes of the application of the MIPS 
adjustment factors to payments in accordance with section 1848(q)(6)(E) 
of the Act (referred to as the payment adjustment), we are proposing to 
use a single identifier, TIN/NPI, for all MIPS eligible clinicians, 
regardless of whether the TIN/NPI was measured as an individual, group 
or APM Entity group. In other words, a TIN/NPI may receive a CPS based 
on individual, group, or APM Entity group performance, but the payment 
adjustment would be applied at the TIN/NPI level.
    We are proposing to use the single identifier, TIN/NPI, for the 
payment adjustment for a few reasons. First, the final eligibility 
status of some clinicians would not be known until after the 
performance period ends. For example, the calculations to determine 
which clinicians would be excluded from MIPS, such as identifying 
clinicians that are QPs or are below the low-volume threshold, occur 
after the performance period ends. Using TIN/NPI would allow us to 
correctly identify which TIN/NPIs are still MIPS eligible clinicians 
after the exclusion criteria have been applied.
    Second, the identifiers for measurement are not mutually exclusive 
and using TIN/NPI to apply the payment adjustment would allow us to 
resolve any inconsistencies that arise from the measurement 
identifiers. For example, a TIN may have 40 percent of its eligible 
clinicians participating in a MIPS APM and the remaining 60 percent are 
not participating in any APM. The TIN elects to submit performance 
information for all the eligible clinicians in the TIN, including those 
that are participating in the MIPS APM, so that it can ensure all of 
its eligible clinicians are being measured in MIPS. We cannot simply 
use the APM

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Entity and TIN identifiers because we either have eligible clinicians 
with duplicative data and overlapping scores, or we have portions of 
the measurement identifier carved out if we eliminate the overlap. In 
our example, the eligible clinicians participating in the MIPS APM 
would have data for two CPSs (one based on the APM Entity group 
performance and one based on the group TIN performance). The eligible 
clinicians not participating in the MIPS APM would have only one CPS 
(one based on the group TIN performance). Applying the payment 
adjustment at the TIN/NPI level provides us the flexibility to 
correctly identify and resolve the conflicts emerging when measurement 
identifiers overlap. The TIN/NPI identifier is mutually exclusive on 
all of our measurement identifier options; therefore, we believe this 
identifier can be consistently used for individual, group, or APM 
scoring standard identifiers. We refer readers to section II.E.2 for a 
discussion of identifiers and our proposals related to them.
ii. CPS Used in Payment Adjustment Calculation
    Because we are proposing to use only TIN/NPI to apply the MIPS 
payment adjustments and because there is a gap between the performance 
period and the MIPS payment year, we believe we should assign the 
historical CPS to each TIN/NPI that is subject to MIPS for the payment 
year.
    In general, we propose to use the CPS associated with the TIN/NPI 
combination in the performance period. For groups submitting data using 
the TIN identifier, we propose to apply the group CPS to all the TIN/
NPI combinations that bill under that TIN during the performance 
period. For individual MIPS eligible clinicians submitting data using 
TIN/NPI, we propose to use the CPS associated with the TIN/NPI that is 
used during the performance period. For eligible clinicians in MIPS 
APMs, we propose to assign the APM Entity group's CPS to all the APM 
Entity Participant Identifiers that are associated with the APM Entity 
on December 31 of the performance period. We refer readers to section 
II.E.5.h for more information about the process to identify 
participating APM Entities. For eligible clinicians that participate in 
APMs for which the APM scoring standard does not apply, we propose to 
assign a CPS using either the individual or group data submission 
assignments described above.
    In the case where a MIPS eligible clinician starts working in a new 
practice or otherwise establishes a new TIN that did not exist during 
the performance period, there would be no corresponding historical 
performance information or CPS for the new TIN/NPI. Because we want to 
connect actual performance to the individual MIPS eligible clinician as 
often as possible, in cases where there is no CPS associated with a 
TIN/NPI from the performance period, we propose to use the NPI's 
performance for the TIN(s) the NPI was billing under during the 
performance period. If the MIPS eligible clinician has only one CPS 
associated with the NPI from the performance period, then we propose to 
use that CPS. For example, if a MIPS eligible clinician worked in one 
practice (TIN A) in the performance period, but is working at a new 
practice (TIN B) during the payment year, then we would use the CPS for 
the old practice (TIN A/NPI) to apply the MIPS payment adjustment for 
the NPI in the new practice (TIN B/NPI). This proposal most closely 
links the MIPS eligible clinician's performance during the performance 
period to the payment adjustment. It also ensures that MIPS eligible 
clinicians who qualify for a positive payment adjustment are able to 
keep it, even if they change practices. For those who have a negative 
payment adjustment, this proposal also ensures MIPS eligible clinicians 
are still accountable for their performance.
    In scenarios where the MIPS eligible clinician billed under more 
than one TIN during the performance period, and the MIPS eligible 
clinician starts working in a new practice or otherwise establishes a 
new TIN that did not exist during the performance period, we propose to 
use a weighted average CPS based on total allowed charges associated 
with the NPI from the performance period. This proposal would provide a 
CPS that is based on all the services the NPI billed to Medicare during 
the performance period. Table 26 presents an example of how this 
proposed approach would work. In this example, a MIPS eligible 
clinician (NPI) was assigned a CPS for two unique TIN/NPI combinations 
from the performance period (TIN A/NPI and TIN B/NPI). In the MIPS 
payment year, the eligible clinician is now billing for Medicare 
services under a third TIN/NPI combination without a previously 
calculated CPS (TIN C/NPI). In this case, the eligible clinician's MIPS 
adjustment for payments made to TIN C/NPI would be based on a weighted 
average of CPSs for TIN A/NPI and TIN B/NPI.
[GRAPHIC] [TIFF OMITTED] TP09MY16.031

    If an NPI did not have any allowed charges in the performance 
period, then the clinician would not be included in MIPS due to the 
low-volume exclusion.
    We also propose an alternative proposal where in lieu of taking the

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weighted average, we take the highest CPS from the performance period, 
which would be a CPS of 67.5 in the above example which is the CPS for 
TIN A/NPI. We believe the alternative approach rewards eligible 
clinicians for their prior performance and may be easier to implement 
in year 1 of MIPS. Our concern with this approach is that the highest 
CPS may represent a relatively small portion of the eligible 
clinician's practice during the performance period.
    We request comment on the proposal to use the CPSs associated with 
the TIN(s) the NPI was billing under during the performance period when 
the TIN/NPI does not have a CPS from the performance period. We also 
request comment on our proposal to use a weighted average, and the 
alternative proposal to select the highest CPS from the performance 
period.
    We also considered, but are not proposing, a policy to have the 
performance follow the group (TIN) rather than the individual (NPI). In 
other words, the MIPS eligible clinician's performance would be based 
on the historical performance of the new TIN that the MIPS eligible 
clinician moved to after the performance period, even though the MIPS 
eligible clinician was not part of this group during the performance 
period. This policy is consistent with the policy for the VM and would 
create incentives for MIPS eligible clinicians to move to higher 
performing practices (77 FR 69308). We also believe this policy would 
provide a lower burden for practice administrators as all MIPS eligible 
clinicians in the TIN would have the same payment adjustment. On the 
other hand, having performance follow the TIN creates some challenges. 
We are concerned that MIPS eligible clinicians who earned a positive 
adjustment based on their performance during the performance period 
would not retain the positive adjustment if the new TIN had a lower 
CPS. Finally, we believe that having performance follow the TIN could 
create some unanticipated issues with budget neutrality if high-
performing TINs expand. For all of these reasons, we are not proposing 
to have performance follow the TIN, but rather have performance follow 
the NPI; however, we seek comment on this option.
    In some cases, a TIN/NPI could have more than one CPS associated 
with it from the performance period, if the eligible clinician 
submitted duplicative data sets. In this situation, the MIPS eligible 
clinician has not changed practices, rather for example, a MIPS 
eligible clinician has a CPS for an APM Entity and a CPS for a group 
TIN. If a MIPS eligible clinician has multiple CPSs, we propose a 
multi-pronged approach to select the CPS that would be used to 
determine the MIPS payment adjustment. First, we propose that if a MIPS 
eligible clinician is a participant in MIPS APM, then the APM Entity 
CPS would be used instead of any other CPS (such as a group TIN CPS or 
individual CPS). We propose that if a MIPS eligible clinician has more 
than one APM Entity CPS for the same TIN (by participating in multiple 
MIPS APMs), we would apply the highest APM Entity CPS to the eligible 
clinician. Second, if a MIPS eligible clinician reports as a group and 
as an individual, we would calculate a CPS for the group and individual 
identifier and use the highest CPS for the TIN/NPI. We request comment 
on this proposed approach.
b. MIPS Adjustment Factors
    Section 1848(q)(6)(A) of the Act requires the Secretary to specify 
a MIPS adjustment factor for each MIPS eligible clinician for a year 
determined by comparing the CPS of the MIPS eligible clinician for such 
year to the performance threshold established under paragraph (D)(i) 
for such year, in a manner such that the adjustment factors specified 
for a year result in differential payments. Section 1848(q)(6)(A)(iii) 
of the Act provides that MIPS eligible clinicians with CPS at or above 
the performance threshold receive a zero or positive adjustment factor 
on a linear sliding scale such that an adjustment factor of 0 percent 
is assigned for a CPS at the performance threshold and an adjustment 
factor of the applicable percent is assigned for a CPS of 100. Section 
1848(q)(6)(A)(iv) of the Act provides that MIPS eligible clinicians 
with CPS below the performance threshold receive a negative payment 
adjustment factor on a linear sliding scale such that an adjustment 
factor of 0 percent is assigned for a CPS at the performance threshold 
and an adjustment factor of the negative of the applicable percent is 
assigned for a CPS of 0; further, MIPS eligible clinicians with CPS 
that are equal to or greater than zero, but not greater than one-fourth 
of the performance threshold, receive a negative payment adjustment 
factor that is equal to the negative of the applicable percent.
    Section 1848(q)(6)(B) of the Act defines the applicable percent for 
each year as follows: (i) For 2019, 4 percent; (ii) for 2020, 5 
percent; (iii) for 2021, 7 percent; and (iv) for 2022 and subsequent 
years, 9 percent.
    Section 1848(q)(6)(C) of the Act provides for an additional 
positive MIPS adjustment factor for exceptional performance, for each 
of the years 2019 through 2024, for each MIPS eligible clinician with a 
CPS for a year at or above the additional performance threshold under 
paragraph (D)(ii) for such year. The additional MIPS adjustment factor 
shall be in the form of a percent and determined in a manner such that 
eligible clinicians having higher CPS above the additional performance 
threshold receive higher additional MIPS adjustment factors.
c. Determining the Performance Thresholds
(1) Establishing the Performance Threshold
    Under section 1848(q)(6)(D)(i) of the Act, for each year of the 
MIPS, the Secretary shall compute a performance threshold with respect 
to which the CPS of MIPS eligible clinicians are compared for purposes 
of determining the MIPS adjustment factors under section 1848(q)(6)(A) 
of the Act for a year. The performance threshold for a year must be 
either the mean or median (as selected by the Secretary, which may be 
reassessed every three years) of the CPS for all MIPS eligible 
clinicians for a prior period specified by the Secretary. Section 
1848(q)(6)(D)(iii) of the Act outlines a special rule for the initial 
two years of MIPS, which requires the Secretary, prior to the 
performance period for such years, to establish a performance threshold 
for purposes of determining the MIPS adjustment factors under paragraph 
(A) and an additional performance threshold for purposes of determining 
the additional MIPS adjustment factors under paragraph (C), each of 
which shall be based on a period prior to the performance periods and 
take into account data available with respect to performance on 
measures and activities that may be used under the performance 
categories and other factors determined appropriate by the Secretary.
    We define the term performance threshold at Sec.  414.1305, as the 
level of performance that is established for a performance period at 
the CPS level. CPSs above the performance threshold receive a positive 
MIPS adjustment factor and CPSs below the performance threshold receive 
a negative MIPS adjustment factor. CPSs that are equal to or greater 
than 0, but not greater than one-fourth of the performance threshold 
receive the maximum negative MIPS adjustment factor for the MIPS 
payment year. CPSs at the performance threshold

[[Page 28274]]

receive a neutral MIPS adjustment factor.
    To establish the performance threshold for the 2019 MIPS payment 
year, we propose to model 2014 and 2015 Part B allowed charges, 2014 
and 2015 PQRS data submissions, 2014 and 2015 QRUR and sQRUR feedback 
data, and 2014 and 2015 Medicare and Medicaid EHR Incentive Program 
data to inform where the performance threshold should be. We would use 
this data to estimate the impact of the quality and resource use 
scoring proposals. We would also use the EHR Incentive Program 
information to estimate which MIPS eligible clinicians are likely to 
receive points for the advancing care information performance category. 
Because of the lack of historical data for the CPIA performance 
category, we would apply some sensitivity analyses to help inform where 
the performance threshold should be.
    For the 2019 MIPS payment year, we propose to set the performance 
threshold at a level where approximately half of the eligible 
clinicians would be below the performance threshold and half would be 
above the performance threshold, which we believe is consistent with 
the intent of section 1848(q)(6)(D)(i) of the Act which requires the 
performance threshold in year 3 and beyond to be equal to the mean or 
median of CPS from a prior period. We also considered other policy 
options when setting the performance threshold. For example, we 
considered setting the performance threshold so that the scaling factor 
(which is described in section II.E.7.b) is 1.0. We could set the 
performance threshold based on policy goals to ensure a minimum number 
of points are earned before an eligible clinician is able to receive a 
positive adjustment factor and potentially an additional adjustment 
factor for exceptional performance. We seek comment on the policy 
options for setting the performance threshold.
    We would determine the performance threshold in accordance with the 
methodology established in the final rule. We intend to publish the 
performance threshold on the CMS Web site prior to the performance 
period.
(2) Additional Performance Threshold for Exceptional Performance
    In addition to the performance threshold, section 1848(q)(6)(D)(ii) 
of the Act requires the Secretary to compute, for each year of the 
MIPS, an additional performance threshold for purposes of determining 
the additional positive MIPS adjustment factors for exceptional 
performance under paragraph (C). For each such year, the Secretary 
shall apply either of the following methods for computing the 
additional performance threshold: (1) The threshold shall be the score 
that is equal to the 25th percentile of the range of possible CPS above 
the performance threshold determined under section 1848(q)(6)(D)(i) of 
the Act; or (2) the threshold shall be the score that is equal to the 
25th percentile of the actual CPS for MIPS eligible clinicians with CPS 
at or above the performance threshold with respect to the prior period 
described in section 1848(q)(6)(D)(i) of the Act.
    We define at Sec.  414.1305 the additional performance threshold as 
an additional level of performance, in addition to the performance 
threshold, for a performance period at the CPS level at or above which 
a MIPS eligible clinician may receive an additional positive MIPS 
adjustment factor. For each year of the MIPS, we will compute an 
additional performance threshold for purposes of determining the 
additional MIPS adjustment factors under section 1848(q)(6)(C) of the 
Act. We propose at Sec.  414.1405(e) the following methods for 
computing the additional performance threshold: the threshold shall be 
equal to the 25th percentile of the range of possible CPS above the 
performance threshold; or it shall be equal to the 25th percentile of 
the actual CPS for MIPS eligible clinicians with CPS at or above the 
performance threshold with respect to the prior period used to 
determine the performance threshold.
    As discussed above, section 1848(q)(6)(D)(iii) of the Act outlines 
a special rule for establishing the additional performance threshold 
for the initial two years of MIPS. Because 2019 is the first MIPS 
payment year, we do not have any actual CPS for MIPS eligible 
clinicians to use for purposes of defining an additional performance 
threshold under the methodology proposed above. Therefore, we propose 
to establish the additional performance threshold at the 25th 
percentile of the range of possible CPS above the performance 
threshold. For example, if the performance threshold is 60, then the 
range of possible CPS above the performance threshold would be 61-100. 
The 25th percentile of those possible values is 70. We intend to 
publish the exceptional performance threshold with the performance 
threshold prior to the performance period.
d. Scaling/Budget Neutrality
    Section 1848(q)(6)(F)(i) of the Act provides, with respect to 
positive MIPS adjustment factors for eligible clinicians whose CPS is 
above the performance threshold under paragraph (D)(i) for such year, 
the Secretary shall increase or decrease such adjustment factors by a 
scaling factor (not to exceed 3.0) in order to ensure that the budget 
neutrality requirement of clause (ii) is met. Stated generally, budget 
neutrality as required by section 1848(q)(6)(F)(ii) of the Act means 
the estimated increase in the aggregate allowed charges resulting from 
the application of positive MIPS adjustment factors under paragraph (A) 
(after application of the scaling factor) is equal to the estimated 
decrease in the aggregate allowed charges resulting from the 
application of negative MIPS adjustment factors under paragraph (A). 
Under section 1848(q)(6)(F)(iii) of the Act, budget neutrality 
requirements shall not apply if all MIPS eligible clinicians receive 
CPS for a year that are below the performance threshold under paragraph 
(D)(i) for such year, or if the maximum scaling factor (3.0) is applied 
for a year.
e. Additional Adjustment Factors
    Section 1848(q)(6)(C) of the Act requires, for each of the years 
2019 through 2024, the Secretary to specify an additional positive MIPS 
adjustment factor for each MIPS eligible clinician whose CPS for a year 
is at or above the additional performance threshold established under 
paragraph (D)(ii) for that year. This additional adjustment factor is 
required to take the form of a percentage and to be determined by the 
Secretary such that MIPS eligible clinicians with higher CPS above the 
additional performance threshold receive higher additional MIPS 
adjustment factors. Section 1848(q)(6)(F)(iv)(I) of the Act provides, 
in specifying the additional adjustment factors under paragraph (C) for 
each applicable MIPS eligible clinician for a year, the Secretary shall 
ensure that the estimated aggregate increase in payments under Part B 
resulting from the application of such additional adjustment factors 
shall be equal to $500,000,000 for each year beginning with 2019 and 
ending with 2024. We refer to the $500,000,000 increase in payments as 
aggregate incentive payments. Section 1848(q)(6)(F)(iv)(II) of the Act 
provides that the additional adjustment factor for each applicable MIPS 
eligible clinician shall not exceed 10 percent, which may result in an 
aggregate increase in payments that is less than $500,000,000 as 
described in subclause (I).
    To be consistent with the MIPS adjustment factors under section 
1848(q)(6)(A) of the Act, we propose to

[[Page 28275]]

apply a linear sliding scale where MIPS eligible clinicians with a CPS 
at the additional performance threshold would receive 0.5 percent 
additional adjustment factor and MIPS eligible clinicians with a CPS 
equal to 100 would receive a 10 percent maximum additional adjustment 
factor. Similar to the adjustment factor, we would apply a scaling 
factor that is greater than 0 and less than or equal to 1.0 if needed 
to ensure distribution of the $500,000,000 increase in payments. The 
scaling factor must be greater than 0 to ensure that MIPS eligible 
clinicians with higher CPS receive a higher additional adjustment 
factor. The scaling factor cannot exceed 1.0; the 10 percent maximum 
additional adjustment factor could only decrease and not increase 
because section 1848(q)(6)(F)(iv)(II) of the Act provides that the 
additional adjustment factor shall not exceed 10 percent. We are 
proposing the starting point for the additional adjustment factor at 
0.5 percent for a CPS at the additional performance threshold because 
this would provide a large enough incentive for MIPS eligible 
clinicians to strive for the additional performance threshold, while 
still providing the opportunity for a positive slope on the linear 
sliding scale. If we are unable to achieve a linear sliding scale 
starting at 0.5 percent (because the estimated aggregate increase in 
payments for a year would exceed $500 million), then we propose to 
lower the starting percentage for a CPS at the additional performance 
threshold until we are able to create the linear sliding scale with a 
scaling factor greater than 0 and less than or equal to 1.0. A MIPS 
eligible clinician with a CPS that is below the additional performance 
threshold would not be eligible for an additional adjustment factor. We 
request comments on these proposals.
f. Application of the MIPS Adjustment Factors
    Section 1848(q)(6)(E) of the Act provides that for items and 
services furnished by a MIPS eligible clinician during a year 
(beginning with 2019), the amount otherwise paid under Part B with 
respect to such items and services and MIPS eligible clinician for such 
year, shall be multiplied by 1 plus the sum of the MIPS adjustment 
factor determined under paragraph (A) divided by 100, and as 
applicable, the additional MIPS adjustment factor determined under 
paragraph (C) divided by 100. We would apply the adjustment factors in 
accordance with section 1848(q)(6)(E) of the Act.
    We request comment on our proposals.
g. Example of Adjustment Factors
    Figure A provides an example of how various CPS would be converted 
to an adjustment factor and potentially an additional adjustment 
factor, using the statutory formula. In this example, the performance 
threshold is 60. The applicable percentage is 4 percent for 2019. The 
adjustment factor is determined on a linear sliding scale from zero to 
100, with zero being the lowest negative applicable percentage 
(negative 4 percent for 2019), and 100 being the highest positive 
applicable percentage. However, there are two modifications to this 
linear sliding scale. First, there is an exception for a CPS between 0 
and \1/4\ of the performance threshold (0-15 in our example). All MIPS 
eligible clinicians with a CPS in this range would receive the lowest 
negative applicable percentage (negative 4 percent for 2019). Second, 
the linear sliding scale line for the positive adjustment factor is 
adjusted by the scaling factor (which is determined by the formula 
described in section II.E.7.c.) If the scaling factor is greater than 0 
and less than or equal to 1.0, then the adjustment factor for a CPS of 
100 would be less than or equal to 4 percent. If the scaling factor is 
above 1.0, but less than or equal to 3.0, then the adjustment factor 
for a CPS of 100 would be higher than 4 percent. Only those MIPS 
eligible clinicians with a CPS equal to 60 (which is the performance 
threshold in this example) would receive no adjustment. In Figure A, 
the scaling factor for the adjustment factor is 1.37. MIPS eligible 
clinicians with a CPS equal to 100 would have an adjustment of 5.5 
percent (4.0 percent x 1.37).
    For the performance threshold of 60, the additional performance 
threshold for exceptional performance is 70. A CPS of 70 would have an 
additional adjustment factor of 0.5 percent, and the amount of the 
additional adjustment factor would increase to 10 percent times a 
scaling factor that is greater than 0 and less than or equal to 1.0. In 
Figure A, the scaling factor for the additional adjustment factor is 
0.32. Therefore, MIPS eligible clinicians with a CPS of 100 would have 
an additional adjustment of 3.2 percent (10 percent x 0.32). The total 
adjustment for a MIPS eligible clinician with a CPS equal to 100 would 
be 1 + 0.055 + 0.032 = 1.087, for a total positive adjustment of 8.7 
percent.

[[Page 28276]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.032


    Note: The adjustment factor for CPS values above the performance 
threshold is illustrative. For MIPS eligible clinicians with a CPS 
of 100, the adjustment factor would be 4 percent times a scaling 
factor greater than 0 and less than or equal to 3.0. The scaling 
factor is intended to ensure budget neutrality, but cannot be higher 
than 3.0. The additional adjustment factor is also illustrative. The 
additional adjustment factor starts at 0.5 percent and cannot exceed 
10 percent.

    The final MIPS payment adjustments would be determined by the 
distribution of CPS across MIPS eligible clinicians and the performance 
threshold. More MIPS eligible clinicians above the performance 
threshold means the scaling factors would decrease because more MIPS 
eligible clinicians receive a positive adjustment. More MIPS eligible 
clinicians below the performance threshold means the scaling factors 
would increase because more MIPS eligible clinicians would have 
negative adjustments and relatively fewer MIPS eligible clinicians 
receive positive adjustments.
    We request comment on our proposals.
8. Review and Correction of MIPS Composite Performance Score
a. Feedback and Information To Improve Performance
    Through the MIPS and APMs RFI, we solicited comment on various 
questions related to performance feedback under section 1848(q)(12) of 
the Act, such as what type of information should be contained in the 
performance feedback data, how often the feedback should be made 
available, and who should be able to access the data. Several 
commenters stated that it would be beneficial if the performance 
feedback under MIPS contained all the data that contributes to an EP's 
CPS and any MIPS adjustment. Further, several commenters suggested that 
performance feedback allow for interactive use of the data. Commenters 
supported frequent availability of such data and many noted that a 
minimum of quarterly feedback data would be preferred. Commenters also 
noted that access to PQRS Feedback Reports currently was a challenge 
and some suggested that the EPs should be able to control who can 
access the feedback reports.
(1) Performance Feedback
(a) MIPS Eligible Clinicians
    Under section 1848(q)(12)(A)(i) of the Act, as added by section 
101(c)(1) of the MACRA, we are at a minimum required to provide MIPS 
eligible clinicians with timely (such as quarterly) confidential 
feedback on their performance under the quality and resource use 
performance categories beginning July 1, 2017, and we have discretion 
to provide such feedback regarding the CPIA and advancing care 
information performance categories.
    Beginning July 1, 2017, we propose to include information on the 
quality and resource use performance categories in the performance 
feedback. Within these performance categories, we propose to use fields 
similar (that is, quality and resource use) to those currently 
available in the Quality and Resource Use Reports (QRURs). Since the 
QRURs already provide information on quality and resource use we 
believe this is a good starting point for the data fields to be 
included in the performance feedback. Additional information on the 
current QRURs can be found at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Obtain-2013-QRUR.html.
    The first performance feedback is due on July 1, 2017. As this is 
prior to us having received any MIPS data, we propose to initially 
provide feedback to MIPS eligible clinicians who are participating in 
MIPS using historical data set(s), as available and applicable. For 
example, these historical data set(s) could be a baseline report, using 
data based off performance that occurred in CY 2015 or CY 2016 for 
applicable and available quality and resource use data. In the event 
that 2017 is the first MIPS performance period (as proposed in section 
II.E.4. of this rule), we would not anticipate receiving the first set 
of

[[Page 28277]]

data for MIPS until 2018 (as proposed in section II.E.5. of this rule). 
At a minimum for the first year, we propose to provide performance 
feedback on an annual basis since the first performance feedback, 
required on July 1, 2017 would be based on historic data set(s). As the 
program evolves, and we can operationally assess/analyze the MIPS data, 
we may consider in future years providing performance feedback on a 
more frequent basis, such as quarterly. Section 1848(q)(12)(A)(i) of 
the Act requires the performance feedback to be provided ``timely'' 
(such as quarterly), which is our goal as MIPS evolves. In addition, we 
seek comments on whether we should include first year measures in the 
performance feedback, meaning new measures that have been in use for 
less than 1 year, regardless of submission methods. The reasoning 
behind first-year measures potentially not being reported is we need to 
review the data from the measure before this data is incorporated into 
performance feedback, as we want to ensure the data we are providing in 
the performance feedback is useful and has usability for our 
stakeholders. We request comments on these proposals.
    In future years and as the program evolves, we intend to seek 
comment on the template, including but not limited to the data fields, 
for performance feedback. While section 1848(q)(12)(A)(i) of the Act 
only requires us to provide performance feedback for the quality and 
resource use performance categories, we understand that the CPIA and 
advancing care information performance categories are important MIPS 
data. Commenters to the MIPS and APMs RFI noted that CMS should consult 
with stakeholders to ensure this performance feedback is useful before 
this data is provided to MIPS eligible clinicians. Therefore, we may 
consider including feedback on the performance categories of CPIA and 
advancing care information in future years. Further, before we consider 
adding CPIA and advancing care information data to the performance 
feedback we would like to engage in stakeholder outreach to understand 
what data fields might be helpful and usable to MIPS eligible 
clinicians. Regarding the MIPS CPS, this is something we are targeting 
to provide annually as part of the performance feedback as the program 
evolves. As technically feasible, we are also planning to provide data 
fields such as the CPS and each of the four performance categories in 
future performance feedback once MIPS data becomes available. In 
addition, we plan to explore the possibility of including the MIPS 
adjustment factor (and, as applicable, the additional MIPS adjustment 
factor) in future performance feedback. We seek comment on the 
frequency with which this performance feedback should be provided, 
considerations for including CPIA and advancing care information, and 
data fields that should be included in the performance feedback as this 
program evolves.
(b) APM Entities
    We proposed in section II.E.5.h.(15) of this rule that MIPS 
eligible clinicians who participate in APM Entities would receive 
performance feedback, as technically feasible.
(2) Mechanisms
    Under section 1848(q)(12)(A)(ii) of the Act, the Secretary may use 
one or more mechanisms to make performance feedback available, which 
may include use of a web-based portal or other mechanisms determined 
appropriate by the Secretary. For the quality performance category, 
described in section 1848(q)(2)(A)(i) of the Act, the feedback shall, 
to the extent an eligible clinician chooses to participate in a data 
registry for purposes of MIPS (including registries under sections 
1848(k) and (m)) of the Act, be provided based on performance on 
quality measures reported through the use of such registries. With 
respect to any other performance category (that is, resource use, CPIA, 
or advancing care information), the Secretary shall encourage provision 
of feedback through qualified clinical data registries (QCDRs) as 
described in sections 1848(m)(3)(E) of the Act.
    We understand that the PQRS and VM programs have employed various 
communication strategies to notify health care providers of the 
availability of their PQRS Feedback Reports and QRURs, respectively, 
through the CMS portal. However, many health care providers are still 
unaware of these reports and/or have difficulty accessing their reports 
in the portal. Further, we are aware that some health care providers 
perceive the current reports as complex and often difficult to 
understand; while others find the QRURs, and the drill down data 
included in them on the Medicare beneficiaries they serve, very useful. 
We are continuing to work with stakeholders to improve the usability of 
these reports. As we transition to MIPS, we are committed to ensuring 
that eligible clinicians are able to access their performance feedback, 
and that the data are easy to understand while providing information 
that will help drive quality improvement. We propose to initially make 
performance feedback available using a CMS designated system, such as a 
web-based portal; if technically feasible perhaps an interactive 
dashboard. As further discussed in section II.E.7.e. of this proposed 
rule, we also propose to leverage additional mechanisms such as health 
IT vendors, registries, and QCDRs to help disseminate data/information 
contained in the performance feedback to eligible clinicians, where 
applicable. At this time, we believe that these additional mechanisms 
will only be able to provide information on the quality performance 
category for MIPS in regard to performance feedback.
    We plan to coordinate with third party intermediaries such as 
health IT vendors and QCDRs as MIPS evolves to enable additional 
feedback to be sent on the resource use, advancing care information and 
CPIA performance categories. We seek comment on this for future 
rulemaking.
    Comments received through the MIPS and APMs RFI noted issues 
associated with access to the current Feedback Reports for PQRS. 
Specifically, comments were received noting issues with Enterprise 
Identity Management (EIDM) and access to the portal to view PQRS 
Feedback Reports. Commenters also noted the need for a mechanism to be 
put in place to notify EPs when their PQRS Feedback Report is 
available. We propose to use the information contained in the provider 
or supplier's Medicare enrollment records, and stored in the Provider 
Enrollment, Chain, and Ownership System (PECOS), as the system of 
records for eligible clinicians' contact information that should be 
used when the MIPS performance feedback is available. It is therefore 
critical that eligible clinicians ensure that their Medicare enrollment 
records (especially in regard to phone and email contact information) 
are updated, meaning current, on a consistent basis in PECOS. If more 
than one email address is listed, then the email address that should be 
used for communication should be designated. We also intend to provide 
education and outreach on how to access performance feedback. We seek 
comment on additional means that could be used to notify or contact 
MIPS eligible clinicians and groups when their performance feedback is 
available.
(3) Use of Data
    Under section 1848(q)(12)(A)(iii) of the Act, for purposes of 
providing performance feedback, the Secretary may use data, for a MIPS 
eligible clinician, from periods prior to the

[[Page 28278]]

current performance period and may use rolling periods in order to make 
illustrative calculations about the performance of such professional. 
We believe ``illustrative calculations'' means an interim, snap shot in 
time of performance, or perhaps a ``dry-run'' of the data including 
measure rates. This would provide an indication of how a MIPS eligible 
clinician might be performing, but would not be conclusive. Since MIPS 
will not likely have comparable data until year 3 of the program, these 
``illustrative calculations'' could be based on historical data sets 
available to CMS until actual data for MIPS is available.
(4) Disclosure Exemption
    As stated under section 1848(q)(12)(A)(iv) of the Act, feedback 
made available under section 1848(q)(12)(A) of the Act shall be exempt 
from disclosure under 5 U.S.C. 552 (the Freedom of Information Act).
(5) Receipt of Information
    Section 1848(q)(12)(A)(v) of the Act, states that the Secretary may 
use the mechanisms established under section 1848(q)(12)(A)(ii) of the 
Act to receive information from professionals. This allows for expanded 
use of the feedback mechanism to not only provide feedback on 
performance to eligible clinicians, but to also receive information 
from professionals.
    We intend to explore the possibility of adding this feature to the 
CMS designated system, such as a portal, in future years under MIPS. 
This feature could be a mechanism where eligible clinicians can send 
their feedback (that is, if they are experiencing issues accessing 
their data, technical questions about their data, etc.) to CMS. We 
appreciate that eligible clinicians may have questions regarding the 
information contained in their performance feedback. In order to assist 
eligible clinicians, we intend to establish resources, such as a 
helpdesk or offer technical assistance, to help address questions with 
the goal of linking these resource features to the CMS designated 
system, such as a portal.
    Additionally, we seek comment on the types of information eligible 
clinicians would like to send to CMS via this mechanism.
(6) Additional Information--Type of Information
    Section 1848(q)(12)(B)(i) of the Act, states that beginning July 1, 
2018, the Secretary shall make available to MIPS eligible clinicians 
information about the items and services for which payment is made 
under Title 18 that are furnished to individuals who are patients of 
MIPS eligible clinicians by other suppliers and providers of services. 
This information may be made available through mechanisms determined 
appropriate by the Secretary, such as the proposed CMS designated 
system that would also provide performance feedback. Section 
1848(q)(12)(B)(ii) of the Act specifies that the type of information 
provided may include the name of such providers, the types of items and 
services furnished, and the dates items and services were furnished. 
Historical data regarding the total, and components of, allowed charges 
(and other figures as determined appropriate by the Secretary) may also 
be provided. We seek comment on the type of information MIPS eligible 
clinicians would find useful and the preferred mechanisms to provide 
such information, as well as, arrangements that should be in place 
regarding this data (that is, eligible clinicians sharing data). We 
also seek comment as to whether additional information regarding 
beneficiaries attributed to a MIPS eligible clinician under the 
resource use performance category or information about which MIPS 
eligible clinician(s) beneficiaries to whom a given MIPS eligible 
clinician provides services were attributed would be useful feedback in 
regards to quality improvement efforts.
(7) Performance Feedback Template
    The performance feedback under section 1848(q)(12)(A) of the Act is 
meant to be meaningful and usable to eligible clinicians. In an effort 
to ensure these data are tailored to the needs of eligible clinicians, 
we solicited comment through the MIPS and APMs RFI and received 
numerous comments regarding overall format of the performance feedback 
template. Suggestions were made on what this feedback should include 
for MIPS. We intend to collaborate with stakeholders outside of notice-
and-comment rulemaking on how the performance feedback should look for 
MIPS; as well as, what data elements would be useful for eligible 
clinicians. We seek comment on the fields that should be included in 
the performance feedback template for MIPS eligible clinicians.
b. Announcement of Result of Adjustments
    Section 1848(q)(7) of the Act requires that under the MIPS, the 
Secretary shall, not later than 30 days prior to January 1 of the year 
involved, make available to MIPS eligible clinicians the MIPS 
adjustment factor (and, as applicable, the additional MIPS adjustment 
factor) applicable to the eligible clinician for items and services 
furnished by the professional for such year. The Secretary may include 
such information in the confidential feedback under section 1848(q)(12) 
of the Act.
    If technically feasible, we propose to include the MIPS adjustment 
factor (and, as applicable, the additional MIPS adjustment factor) in 
the performance feedback for eligible clinicians provided under section 
1848(q)(12)(A) of the Act. If it is not technically feasible to provide 
this information in the performance feedback, we propose to make it 
available through another mechanism as determined appropriate by the 
Secretary (such as a portal or a CMS designated Web site) and seek 
comment on mechanisms that might be appropriate. The first announcement 
will be available no later than December 1, 2018 to meet statutory 
requirements. We request comment on these proposals.
c. Targeted Review
    Section 1848(q)(13)(A) of the Act requires the establishment of a 
process under which a MIPS eligible clinician may seek an informal 
review of the calculation of the MIPS adjustment factor (or factors) 
applicable to such MIPS eligible clinician for a year.
    We recognize that a principled approach to requesting and 
conducting a targeted review is required under the MACRA in order to 
minimize burdens on MIPS eligible clinicians and ensure transparency 
under MIPS. We also believe it is important to retain the flexibility 
to modify MIPS eligible clinicians' CPS or payment adjustment based on 
the results of targeted review. This will lend confidence to the 
determination of the CPS and payment adjustments, as well as, providing 
finality for the MIPS eligible clinician after the targeted review is 
completed. It will also minimize the need for claims reprocessing. We 
are proposing an approach below that outlines the factors that we would 
use to determine if a targeted review may be conducted. In keeping with 
the statutory direction that this process be ``informal,'' we have 
attempted to minimize the associated burden on the MIPS eligible 
clinician to the extent possible.
    In accordance with section 1848(q)(13)(A) of the Act, we propose at 
Sec.  414.1385 to adopt a targeted review process under MIPS wherein a 
MIPS eligible clinician may request that we review the calculation of 
the MIPS adjustment factor under section 1848(q)(6)(A) of the Act and, 
as applicable, the calculation of the additional MIPS adjustment factor

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under section 1848(q)(6)(C) of the Act applicable to such MIPS eligible 
clinician for a year. Because this review will be limited to the 
calculation of the MIPS adjustment factor and, as applicable, the 
additional MIPS adjustment factor, we anticipate we may find it 
necessary to review data related to the measures and activities and the 
calculation of the CPS according to the defined methodology. The 
following are examples of circumstances under which a MIPS eligible 
clinician may wish to request a targeted review. This is not a 
comprehensive list of circumstances:
     The MIPS eligible clinician believes that measures or 
activities submitted to CMS during the submission period and used in 
the calculations of the CPS and determination of the adjustment factors 
have calculation errors or data quality issues. These submissions could 
be with or without the assistance of a third party intermediary; or
     The MIPS eligible clinician believes that there are 
certain errors made by CMS, such as performance category scores were 
wrongly assigned to the MIPS eligible clinician (for example, the MIPS 
eligible clinician should have been subject to the low-volume threshold 
exclusion and should not have received a performance category score).
    We believe that a fair targeted review request process requires 
accessibility to all MIPS eligible clinicians within a reasonable 
period of time and provides electronic and telephonic communication for 
questions regarding the targeted review process, as well as for the 
actual request for review and receipt of the decision on that request. 
The targeted review process will use the same help desk support 
mechanism as is provided for MIPS as a whole.
    We further propose at Sec.  414.1385 to adopt the following general 
process for targeted reviews under section 1848(q)(13)(A):
     A MIPS eligible clinician electing to request a targeted 
review may submit their request within 60 days (or a longer period 
specified by us) after the close of the data submission period. All 
requests for targeted review must be submitted by July 31 after the 
close of the data submission period or by a later date that we specify 
in guidance.
     We will provide a response with our decision on whether or 
not a targeted review is warranted. If a targeted review is warranted, 
the timeline for completing that review may be dependent on the number 
of reviews requested (for example, multiple reviews versus a single 
review by one MIPS eligible clinician) and general nature of the 
review.
     As this process is informal and the statute does not 
require a formal appeals process, we will not include a hearing 
process. The MIPS eligible clinician may submit additional information 
to assist in their targeted review at the time of request. If we or our 
contractors request additional information from the MIPS eligible 
clinician, the supporting information must be received from the MIPS 
eligible clinician by us or our contractors within 10 calendar days of 
the request. Non-responsiveness to the request for additional 
information will result in the closure of that targeted review request, 
although another review request may be submitted if the targeted review 
submission deadline has not passed.
     Since this is an informal review process and given the 
limitations on review under section 1848(q)(13)(B) of the Act, 
decisions based on the targeted review will be final, and there will be 
no further review or appeal.
    If a request for targeted review is approved, the outcome of such 
review may vary. For example, we may determine that the clinician 
should have been excluded from MIPS, re-distribute the weights of 
certain performance categories within the CPS (for example, if a 
performance category should have been weighted at zero), or recalculate 
a performance category score in accordance with the scoring methodology 
for the affected category, if technically feasible.
    We request comments on these proposals.
d. Review Limitation
    Section 1848(q)(13)(B) of the Act, as added by section 101(c)(1) of 
the MACRA, provides there shall be no administrative or judicial review 
under sections 1869 and 1878 of the Act, or otherwise of the following:
     The methodology used to determine the amount of the MIPS 
adjustment factor and the amount of the additional MIPS adjustment 
factor and the determination of such amounts;
     The establishment of the performance standards and the 
performance period;
     The identification of measures and activities specified 
for a MIPS performance category and information made public or posted 
on our Physician Compare Web site; and
     The methodology developed that is used to calculate 
performance scores and the calculation of such scores, including the 
weighting of measures and activities under such methodology.
    We propose at Sec.  414.1385 to implement these provisions as 
written in the statute.
    We would reject any requests for targeted review under section 
1848(q)(13)(A) of the Act that focus on the areas precluded from review 
under section 1848(q)(13)(B) of the Act. We request comments on this 
proposal.
e. Data Validation and Auditing
    Our experience with the PQRS, VM and Medicare EHR Incentive 
Programs, has demonstrated the value of data validation and auditing as 
an important part of program integrity, which is necessary to ensure 
valid, reliable data. The current voluntary data validation process for 
PQRS and the audit process for the Medicare EHR Incentive Program are 
multi-step processes. We communicate the types of data elements that 
may be included for data validation across multiple Web sites and our 
documents. This includes defining specific data that may be abstracted 
from the certified EHR technology, as well as other documented records.
    As we begin the MIPS, our strategy is to combine our past program 
integrity processes of the data validation process used in PQRS, and 
the auditing process used in the Medicare EHR Incentive Program into 
one set of requirements for MIPS eligible clinicians and groups, which 
we refer to as ``data validation and auditing.'' Based on our need for 
valid and reliable data on which to base a MIPS eligible clinician's or 
group's payment, we propose certain requirements for MIPS eligible 
clinicians and groups submitting data for the 2017 performance period 
(see section II.E.4) under MIPS. Further, we propose at Sec.  414.1390 
to selectively audit MIPS eligible clinicians on a yearly basis, and 
that if a MIPS eligible clinician or group is selected for audit, the 
MIPS eligible clinician or group would be required to do the following 
in accordance with applicable law:
     Comply with data sharing requests, providing all data as 
requested by us or our designated entity. All data must be shared with 
CMS or our designated entity within 10 business days or an alternate 
time frame that is agreed to by CMS and the MIPS eligible clinician or 
group. Data would be submitted via email, facsimile, or an electronic 
method via a secure Web site maintained by CMS.
     Provide substantive, primary source documents as 
requested. These documents may include: Copies of claims, medical 
records for applicable patients, or other resources used in the data 
calculations for MIPS measures, objectives and activities. Primary 
source documentation also may include verification of records for 
Medicare and

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non-Medicare beneficiaries where applicable.
    We propose that we would monitor MIPS eligible clinicians and 
groups on an ongoing basis for data validation, auditing, program 
integrity issues and instances of non-compliance with MIPS 
requirements. If a MIPS eligible clinician or group is found to have 
submitted inaccurate data for MIPS, we propose that we would reopen, 
revise, and recoup any resulting overpayments in accordance with the 
rules set forth at Sec.  405.980 (re-opening rules), Sec.  450.982 and 
Sec.  450.984 (revising rules); and Sec.  405.370 and Sec.  405.373 
(recoupment rules). It is important to note that at Sec.  405.980(b)(3) 
there is an exception whereby we have the authority to re-open at any 
time for fraud or similar fault. If we re-open the initial 
determination we must revise it, and send out a notice of the revised 
determination under Sec.  450.982. We also propose that we would recoup 
any payments from the MIPS eligible clinician by the amount of any 
debts owed to us by the MIPS eligible clinician and likewise, we would 
recoup any payments from the group by the amount of any debts owed to 
us by the group. We also note that we would need to limit each such 
data validation and audit request to the minimum data necessary to 
conduct validation.
    We propose all MIPS eligible clinicians and groups that submit data 
to CMS electronically must attest to the accuracy and completeness to 
the best of their knowledge of any data submitted to us. This 
attestation will occur prior to any electronic data submissions, via a 
Web site maintained by CMS.
    We request comments on these proposals.
9. Third Party Data Submission
    One of our strategic goals in developing MIPS includes developing a 
program that is meaningful, understandable, and flexible for 
participating MIPS eligible clinicians. One way we believe this will be 
accomplished is through flexible reporting options to accommodate 
different practices and make measurement meaningful. We believe this 
goal can be accomplished by allowing MIPS eligible clinicians the 
flexibility of using third party intermediaries to collect or submit 
data on their behalf. Specifically, qualified registries, QCDRs, health 
IT vendors that obtain data from an eligible clinician's certified EHR 
technology, and CMS-approved survey vendors as discussed in the 
following proposed policies. In this section, we are specifying the 
requirements that must be met to become a third party intermediary.
    In the PQRS program, quality measures data may be collected or 
submitted by third party vendors on behalf of an individual EP or group 
by: (1) A registry; (2) a QCDR; or (3) an EHR vendor that obtains data 
from an EP's certified EHR technology; or (4) a CMS-approved survey 
vendor. We propose at Sec.  414.1400(a)(1) that MIPS data may be 
submitted by third party intermediaries on behalf of a MIPS eligible 
clinician or group by: (1) A qualified registry; (2) a QCDR; (3) a 
health IT vendor; or (4) a CMS-approved survey vendor. Furthermore, we 
propose at Sec.  414.1400(a)(3) that third party intermediaries must 
meet all the requirements designated by CMS as a condition of their 
qualification or approval to participate in MIPS as a third party 
intermediary. As proposed at Sec.  414.1400(a)(3)(ii), all submitted 
data must be submitted in the form and manner specified by CMS.
    In the MIPS and APMs RFI, we solicited feedback on how we should 
address data integrity, testing and standards, and review and 
qualification processes for QCDRs. Subsequently, we also met with 
several organizations that were either a QCDR or are in the process of 
becoming a QCDR. Commenters agreed that data quality is a critical 
issue for QCDRs. To address some of the data quality concerns, some 
commenters suggested having processes in place in advance of reporting 
that could mitigate data errors. For example, this could include a 
process to reconcile TIN and NPI combinations. Several commenters also 
suggested limiting submission mechanisms to one submission mechanism 
per performance category to the extent possible. Commenters generally 
agreed that QCDRs should be required to submit data using uniform 
submission standards, with several suggesting the use of the Quality 
Reporting Document Architecture (QRDA) standard, which certified EHR 
technology is required to support.
    Most commenters noted that uniform standards would ease 
participation by MIPS eligible clinicians and reduce barriers to entry. 
Others noted that we should work with ONC and the standards development 
organization Health Level Seven (HL7) to improve the QRDA standard for 
current submissions, and that in the future, we should prepare to 
support emerging standards such as Fast Healthcare Interoperability 
Resources. Commenters also noted that use of QRDA will align CMS 
requirements and ONC certification requirements as ONC's 2015 Edition 
Certification requires that all health information technology (IT) 
modules used for the submission of CQM data must at least be certified 
to the QRDA standard. Requiring QCDRs to use QRDA could help reduce 
vendor interface costs for MIPS eligible clinicians already using 
certified EHR technology and who desire to participate in registry 
reporting. Commenters also directed our attention towards the 2015 
Edition Certification for additional information on improved test 
methods and to address historic issues and inaccuracies observed with 
past calculation and reporting of quality and performance data. With 
regard to testing, commenters were divided about whether we should 
require QCDR-specific testing. Several noted that certified EHR 
technology that support QCDRs have been tested already and that onerous 
testing may discourage participation. Commenters in favor of testing 
recommended a degree of flexibility in the early years of the program. 
Suggestions for testing included the use of comprehensive 
specifications and accurate testing tools far enough in advance of the 
performance period to allow developers and implementers to conduct 
robust testing. These specifications could be included in an 
Implementation Guide. Opportunities for early testing, using sample 
data was also emphasized. Commenters did express concern on the amount 
of time needed for troubleshooting and fixing errors early enough in 
the testing process such as format, content, and measure accuracy. 
Commenters suggested several ways we might implement testing, 
recommending that we:
     Test the accuracy, completeness, and reliability of 
measure calculations for specific, individual measures.
     Test the feasibility of data collection requirements.
     Pilot new CQMs before release; establish a regular 
schedule of CQM revisions, and ensure adequate time is allowed for 
implementation of the revisions.
     Align the ONC Health IT Certification program and CMS 
testing requirements for data submission.
     Expand the test data sets used by the Cypress Testing 
Tool. More information on the Cypress Testing Tool is available at: 
http://projectcypress.org/about.html.
    There was a strong consensus that MIPS eligible clinicians should 
not be penalized for signing up with an entity that purported to offer 
reliable services but then was unable to accurately submit data to us. 
Several commenters suggested that entities that do not meet

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standards move to a probationary phase and eventually be prohibited 
from periods of future participation until standards are met. However, 
commenters also cautioned us not to move too quickly in moving entities 
to a probationary phase because many QCDRs are run by medical specialty 
societies and if they were to be disqualified to the detriment of 
physicians participating, it would also diminish physician enthusiasm 
for future submission of data.
    Commenters had mixed responses regarding how to resolve inaccurate 
data submission problems when time did not allow for continued review. 
Commenters felt we should use a ``trust but validate'' methodology, 
allowing the QCDR to recalculate the performance rate or authorizing us 
to do so, but also that we should have validation processes in place as 
well once the recalculation of the performance rate occurs. Ultimately, 
we would need to be able to calculate all rates based on a submitted 
numerator and denominator. Commenters suggested that MIPS eligible 
clinicians should be assessed an average score or a ``pass'' for the 
MIPS quality performance category if data problems cannot be resolved 
in a timely manner or at the least not be penalized due to data errors 
outside their control. One commenter suggested use of a Data Quality 
Management (DQM) program for MIPS eligible clinicians that includes 
early data qualification evaluation processes to take advantage of 
feedback and assessments with thresholds for acceptance of data. MIPS 
eligible clinicians who demonstrate effort toward achieving high 
quality data submissions but were not able to meet the threshold should 
be chaperoned to that target and provided with guidance.
    Commenters were also divided about our review and qualification of 
QCDRs to ensure our form and manner requirements are met. Several 
commenters were concerned with a CMS process in addition to an ONC 
certification process and recommended we work with ONC to align their 
certification to address our requirements for QCDRs. Commenters 
suggested that we also develop more robust implementation guides, and 
enhance our submission engine validation tool (SEVT).
a. Qualified Clinical Data Registries (QCDRs)
    Section 1848(q)(1)(E) of the Act requires the Secretary to 
encourage the use of QCDRs under section 1848(m)(3)(E) of the Act in 
carrying out MIPS. Section 1848(q)(5)(B)(ii)(I) of the Act requires the 
Secretary, under the CPS methodology, to encourage MIPS eligible 
clinicians to report on applicable measures with respect to the quality 
performance category through the use of certified EHR technology and 
QCDRs. Section 1848(q)(2)(B)(iii)(II) of the Act requires that the CPIA 
subcategories specified by the Secretary include population management, 
such as monitoring health conditions of individuals to provide timely 
health care interventions or participation in a QCDR. Section 
1848(q)(12)(A)(ii) of the Act requires the Secretary to encourage the 
provision of performance feedback through QCDRs.
    Section 1848(m)(3)(E)(i) of the Act requires the Secretary to 
establish requirements for an entity to be considered a QCDR, which 
must include a requirement that the entity provide the Secretary with 
such information, at such times, and in such manner, as the Secretary 
determines necessary to carry out section 1848(m) of the Act. Section 
1848(m)(3)(E)(iv) of the Act requires the Secretary to consult with 
interested parties in carrying out section 1848(m)(3)(E) of the Act.
    Currently, the QCDR reporting mechanism provides a method to 
satisfy PQRS requirements based on satisfactory participation. We 
propose that entities interested in becoming a QCDR for MIPS go through 
a qualification process. This includes the QCDR meeting the definition 
of a QCDR, self-nomination requirements, and the requirements of a 
QCDR, including the deadlines listed below. This qualification process 
allows us to ensure that the entity has the capability to successfully 
report MIPS eligible clinicians' data to us and allows for review and 
approval of the QCDR's proposed non-MIPS quality measures. We intend to 
compile and post a list of entities that we ``qualify'' to submit data 
to us as a QCDR for purposes of MIPS on a Web site maintained by CMS.
    Section 1848(q)(1)(E) of the Act encourages the use of QCDRs in 
carrying out the MIPS. Although section 1848(q)(5)(B)(ii)(I) of the Act 
specifically requires the Secretary to encourage MIPS eligible 
clinicians to use QCDRs to report on applicable measures with respect 
to the quality performance category and section 1848(q)(12)(A)(ii) of 
the Act requires the Secretary to encourage the provision of 
performance feedback through QCDRs, the statute does not specifically 
address usage of QCDRs for the other MIPS performance categories. 
Although we could limit the usage of QCDRs to assessing the quality 
performance category under MIPS and providing performance feedback, we 
believe it would be less burdensome for MIPS eligible clinicians if we 
expand the QCDRs capabilities. By allowing QCDRs to report on the 
quality, advancing care information, and CPIA performance categories we 
would alleviate the need for individual MIPS eligible clinicians and 
groups to use a separate mechanism to report data for these performance 
categories. It is important to note that no data will need to be 
reported for the resource use performance category since these measures 
are administrative claims-based. Therefore, we are proposing at Sec.  
414.1400(a)(2) to expand QCDRs' capabilities by allowing QCDRs to 
submit data on measures, activities, or objectives for any of the 
following MIPS performance categories:
    (i) Quality;
    (ii) CPIA; or
    (iii) Advancing care information, if the MIPS eligible clinician or 
group is using certified EHR technology.
    We believe this approach would permit a single QCDR to report on 
the quality, advancing care information, and CPIA performance category 
requirements for MIPS and should mitigate the risks, costs, and burden 
of MIPS eligible clinicians having to report multiple times to meet the 
requirements of MIPS.
    We propose to define a QCDR at Sec.  414.1305 as a CMS-approved 
entity that has self-nominated and successfully completed a 
qualification process to determine whether the entity may collect 
medical and/or clinical data for the purpose of patient and disease 
tracking to foster improvement in the quality of care provided to 
patients. Examples of the types of entities that may qualify as QCDRs 
include, but are not limited to, regional collaboratives and specialty 
societies using a commercially available software platform, as 
appropriate.
(1) Establishment of an Entity Seeking To Qualify as a QCDR
    We propose at Sec.  414.1400(c) the establishment of a QCDR entity 
is required as follows: for an entity to become qualified for a given 
performance period as a QCDR, the entity must be in existence as of 
January 1 of the performance period for which the entity seeks to 
become a QCDR (for example, January 1, 2017, to be eligible to 
participate for purposes of performance periods beginning in 2017). The 
QCDR must have at least 25 participants by January 1 of the performance 
period. These participants do not need to be using the QCDR to report 
MIPS data to us; rather, they need to be submitting data to the QCDR 
for quality improvement.

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(2) Self-Nomination Period
    For the 2017 performance period we propose at Sec.  414.1400(b) a 
self-nomination period from November 15, 2016 until January 15, 2017. 
For future years of the program, starting with the 2018 performance 
period, we propose to establish the self-nomination period from 
September 1 of the prior year until November 1 of the prior year. 
Entities that desire to qualify as a QCDR for the purposes of MIPS for 
a given performance period would need to self-nominate for that year 
and provide all information requested by CMS at the time of self-
nomination. Having qualified as a QCDR in a prior year does not 
automatically qualify the entity to participate in MIPS as a QCDR in 
subsequent performance periods. For example, a QCDR may choose not to 
continue participation in the program in future years, or the QCDR may 
be precluded from participation in a future year due to multiple data 
or submission errors as noted below. Finally, QCDRs may want to update 
or change the measures or services or performance categories they 
intend to provide. As such, CMS believes an annual self-nomination 
process is the best process to ensure accurate information is conveyed 
to MIPS eligible clinicians and accurate data is submitted to MIPS.
    We propose to require other information (described below) of QCDRs 
at the time of self-nomination. If an entity becomes qualified as a 
QCDR, they will need to sign a statement confirming this information is 
correct prior to listing it on their Web site. Once we post the QCDR on 
our Web site, including the services offered by the QCDR, we will 
require the QCDR to support these services/measures for its clients as 
a condition of the entity's qualification as a QCDR for purposes of 
MIPS. Failure to do so will preclude the QCDR from participation in 
MIPS in the subsequent year.
(3) Information Required at the Time of Self-Nomination
    We propose that a QCDR must provide the following information to us 
at the time of self-nomination to ensure that QCDR data is valid:
     Organization Name (Specify Sponsoring Organization name 
and software vendor name if the two are different. For example, a 
specialty society in collaboration with a software vendor).
     MIPS performance categories (that is, categories for which 
the entity is self-nominating. For example, quality, advancing care 
information, and/or CPIA).
     Performance Period.
     Vendor Type (for example, qualified clinical data 
registry).
     Provide the method(s) by which the entity obtains data 
from its customers for each performance category for which it is 
approved: Claims, web-based tool, practice management system, certified 
EHR technology, other (please explain). If a combination of methods 
(Claims, web-based tool, Practice Management System, certified EHR 
technology, and/or other) is utilized, the entity should state which 
method(s) it utilizes to collect data (for example, performance 
numerator and denominator).
     Indicate the method the entity will use to verify the 
accuracy of each TIN/NPI it is intending to submit (for example, 
National Plan and Provider Enumeration System (NPPES), CMS claims, tax 
documentation).
     Describe the method that the entity will use to accurately 
calculate performance rates for quality measures based on the 
appropriate measure type and specification. For composite measures or 
measures with multiple performance rates, the entity must provide us 
with the methodology the entity uses to calculate these composite 
measures and measures with multiple performance rates. The entity 
should be able to report to us a calculated composite measure rate if 
applicable.
     Describe the method that the entity will use to accurately 
calculate performance data for CPIA and advancing care information 
based on the appropriate parameters or activities.
     Describe the process that the entity will use for 
completion of a randomized audit of a subset of data prior to the 
submission to us (for all performance categories the QCDR is submitting 
data on, that is, quality, CPIA, and advancing care information, as 
applicable). Periodic examinations may be completed to compare patient 
record data with submitted data and/or ensure MIPS quality measures or 
other performance category (CPIA, advancing care information) 
activities were accurately reported and performance calculated based on 
the appropriate measure specifications (that is, accuracy of numerator, 
denominator, and exclusion criteria) or performance category 
requirements.
     Provide information on the entity's process for data 
validation for both individual MIPS eligible clinicians and groups 
within a data validation plan. For example, for individuals it is 
encouraged that 3 percent of the TIN/NPIs submitted to us by the QCDR 
be sampled with a minimum sample of 10 TIN/NPIs or a maximum sample of 
50 TIN/NPIs. For each TIN/NPI sampled, it is encouraged that 25 percent 
of the TIN/NPI's patients (with a minimum sample of five patients or a 
maximum sample of 50 patients) should be reviewed for all measures 
applicable to the patient.
     Provide the results of the executed data validation plan 
by May 31 of the year following the performance period. If the results 
indicate the QCDR's validation reveals inaccuracy or low compliance 
provide to CMS an improvement plan. Failure to implement improvements 
may result in the QCDR being placed in a probationary status or 
disqualification from future participation.
     For non-MIPS quality measures, if the measure is risk-
adjusted, the QCDR is required to provide details to CMS on their risk 
adjustment methodology (risk adjustment variables, and applicable 
calculation formula) at the time of the QCDR's self-nomination. The 
QCDR must submit the risk adjusted results to CMS when submitting a 
risk-adjusted measure on behalf of the QCDR's MIPS eligible clinicians 
for the performance period.
(4) QCDR Requirements for Data Submission
    In addition, we propose that a QCDR must perform the following 
functions:
     For measures under the quality performance category and as 
proposed at Sec.  414.1400(a)(4)(i), if the data is derived from 
certified EHR technology, the QCDR must be able to indicate this data 
source.
     QCDRs must provide complete quality measure specifications 
including data elements to us for non-MIPS quality measures intended 
for reporting from certified EHR technology.
     QCDRs must provide a plan to risk adjust (if appropriate 
for the measure) the non-MIPS quality measures data for which it 
collects and intends to transmit to us and must submit the risk-
adjusted results (not the non-risk adjusted rates), to CMS. The risk 
adjustment methodology (formula and variables) must be integrated with 
the complete quality measure specifications. Specifically, for risk-
adjusted non-MIPS quality measures, a QCDR is required to provide 
details to CMS on their risk adjustment methodology. The data elements 
used for risk adjustment may vary by measure and measure type. The risk 
adjustment methodology, including the risk adjustment variables, must 
be posted along with the measure's specifications on the QCDR's Web 
site. CMS believes risk-adjustment for certain outcomes measures is 
important to account for the differences in the complexities of care 
provided to

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different patients. That is, some patients may have additional 
comorbidities which could affect their response to treatment and 
subsequently their outcome. Risk adjustment will help offset potential 
poorer outcomes for those MIPS eligible clinicians caring for sicker 
patients.
     QCDRs submitting MIPS quality measures that are risk-
adjusted (and have the risk-adjusted variables and methodology listed 
in the measure specifications) must submit the risk-adjusted measure 
results to CMS when submitting the data for these measures.
     Submit quality, advancing care information, or CPIA data 
and results to us in the applicable MIPS performance categories for 
which the QCDR is providing data.
     A QCDR must have in place mechanisms for the transparency 
of data elements and specifications, risk models, and measures. That 
is, we expect that the non-MIPS measures and their data elements (that 
is, specifications) comprising these measures be listed on the QCDR's 
Web site unless the measure is a MIPS measure, in which case the 
specifications will be posted by us.
     Submit to us data on measures, activities, and objectives 
for all patients, not just Medicare patients.
     Provide timely feedback, at least 6 times a year, on all 
of the MIPS performance categories that the QCDR will report to us. 
That is, if the QCDR will be reporting on data for the CPIA, advancing 
care information, or quality performance category, all results as of 
the feedback report date should be included in the information sent 
back to the MIPS eligible clinician. The feedback should be given to 
the individual MIPS eligible clinician or group (if participating as a 
group) at the individual participant level or group level, as 
applicable, for which the QCDR reports. The QCDR is only required to 
provide feedback based on the MIPS eligible clinician's data that is 
available at the time the feedback report is generated.
     Possess benchmarking capacity (for non-MIPS quality 
measures) that compares the quality of care a MIPS eligible clinician 
provides with other MIPS eligible clinicians performing the same 
quality measures. For non-MIPS measures the QCDR must provide us, if 
available, data from years prior (for example, 2015 data for the 2017 
MIPS performance period) before the start of the performance period. In 
addition, the QCDR must provide us, if available, with the entire 
distribution of the measure's performance broken down by deciles. As an 
alternative to supplying this information to us, the QCDR may post this 
information on their Web site prior to the start of the performance 
period, to the extent permitted by applicable privacy laws.
     QCDRs must comply with any request by us to review the 
data submitted by the QCDR for purposes of MIPS in accordance with 
applicable law. Specifically, data requested would be limited to the 
minimum necessary for us to carry out, for example, health care 
operations or health oversight activities.
     Mandatory participation in ongoing support conference 
calls hosted by us (approximately one call per month), including an in-
person QCDR kick-off meeting (if held) at our headquarters in 
Baltimore, MD. More than one unexcused absence could result in the QCDR 
being precluded from participation in the program for that year. If a 
QCDR is precluded from participation in MIPS, the individual MIPS 
eligible clinician or group would need to find another QCDR or utilize 
another data submission mechanism to submit their MIPS data.
     Agree that data inaccuracies including (but not limited 
to) TIN/NPI mismatches, formatting issues, calculation errors, data 
audit discrepancies affecting in excess of 3 percent of the total 
number of MIPS eligible clinicians submitted by the QCDR may result in 
notations on our qualified QCDR posting of low data quality and would 
place the QCDR on probation (if they decide to self-nominate for the 
next program year). If the QCDR does not reduce their data error rate 
below 3 percent in the subsequent year, they would continue to be on 
probation and have their listing on the CMS Web site continue to note 
the poor quality of the data they are submitting for MIPS. Data errors 
affecting in excess of 5 percent of the MIPS eligible clinicians 
submitted by the QCDR may lead to the disqualification of the QCDR from 
participation in the following year's program. As we gain additional 
experience with QCDRs, we intend to revisit and enhance these 
thresholds in future years.
     Be able to submit results for at least six quality 
measures including one cross-cutting measure and one outcome measure. 
If an outcome measure is not available, be able to submit results for 
at least one other high priority measure (appropriate use, patient 
safety, efficiency, patient experience, and care coordination 
measures). If no outcome measure is available, then the QCDR must 
provide a justification for not including an outcome measure.
     QCDRs may request to report on up to 30 quality measures 
not in the annual list of MIPS quality measures. Full specifications 
will need to be provided to us at the time of self-nomination. CMS will 
review the quality measures and determine if they are appropriate for 
QCDR reporting.
     Enter into and maintain with its participating clinicians 
an appropriate Business Associate agreement that provides for the 
QCDR's receipt of patient-specific data from an individual MIPS 
eligible clinician or group, as well as the QCDR's disclosure of 
quality measure results and numerator and denominator data and/or 
patient specific data on Medicare and non-Medicare beneficiaries on 
behalf of MIPS eligible clinicians and groups.
     Obtain and keep on file signed documentation that each 
holder of an NPI whose data are submitted to the QCDR, has authorized 
the QCDR to submit quality measure results, CPIA measure and activity 
results, advancing care information objective results and numerator and 
denominator data and/or patient-specific data on Medicare and non-
Medicare beneficiaries to CMS for the purpose of MIPS participation. 
This documentation must be obtained at the time the MIPS eligible 
clinician or group signs up with the QCDR to submit MIPS data to the 
QCDR and must meet the requirements of any applicable laws, 
regulations, and contractual business associate agreements. Groups 
participating in MIPS via a QCDR may have their group's duly authorized 
representative grant permission to the QCDR to submit their data to us. 
If submitting as a group, each individual MIPS eligible clinician does 
not need to grant their individual permission to the QCDR to submit 
their data to us.
     Not be owned and managed by an individual locally owned 
single specialty group (for example, single specialty practices with 
only one practice location or solo practitioner practices are 
prohibited from self-nominating to become a qualified QCDR).
     Be able to separate out and report on all payers including 
Medicare Part B FFS patients and non-Medicare patients.
     Provide the measure numbers for the MIPS quality measures 
on which the QCDR is reporting.
     Provide the measure title for the MIPS quality measures 
and CPIAs (if applicable) on which the QCDR is reporting.
     Report the number of eligible instances (reporting 
denominator).
     Report the number of instances a quality service is 
performed (performance numerator).

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     Report the number of performance exclusions, meaning the 
quality action was not performed for a valid reason as defined by the 
measure specification.
     Comply with a CMS-specified secure method for data 
submission, such as submitting the QCDR's data in an XML file.
     Sign a document verifying the QCDR's name, contact 
information, cost for MIPS eligible clinicians or groups to use the 
QCDR, services provided, and the measures and specialty-specific 
measure sets the QCDR intends to report. Once posted, on the QCDR's or 
CMS Web site, the QCDR will need to support the measures/measure sets 
confirmed by the QCDR. Failure to do so will preclude the QCDR from 
participation in MIPS in the subsequent year.
     Must provide attestation statements during the data 
submission period that all of the data (quality measures, CPIAs, and 
advancing care information measures and objectives, if applicable) and 
results are accurate and complete.
     For purposes of distributing feedback reports to MIPS 
eligible clinicians, collect a MIPS eligible clinician's email 
addresses and have documentation from the MIPS eligible clinician 
authorizing the release of his or her email address.
     Be able to calculate and submit measure-level reporting 
rates or, upon request, the data elements needed to calculate the 
reporting and performance rates by TIN/NPI and/or TIN.
     Be able to calculate and submit, by TIN/NPI and/or TIN, a 
performance rate (that is the percentage of a defined population who 
receive a particular process of care or achieves a particular outcome 
based on a calculation of the measures' numerator and denominator 
specifications) for each measure on which the TIN/NPI and/or TIN 
reports or, upon request the Medicare beneficiary data elements needed 
to calculate the performance rates.
     Provide the performance period start date the QCDR will 
cover.
     Provide the performance period end date the QCDR will 
cover.
     Report the number of reported instances, performance not 
met, meaning the quality actions was not performed for no valid reason 
as defined by the measure specification.
     For data validation purposes, provide information on the 
entity's sampling methodology. For example, it is encouraged that 3 
percent of the MIPS eligible clinicians be sampled with a minimum 
sample of 10 MIPS eligible clinicians or a maximum sample of 50 MIPS 
eligible clinicians. For each MIPS eligible clinicians sampled, it is 
encouraged that 25 percent of the MIPS eligible clinicians' patients 
(with a minimum sample of five patients or a maximum sample of 50 
patients) should be reviewed for all measures applicable to the 
patient.
     Submit all of the measures (MIPS measures and non-MIPS 
measures) including specifications for the non-MIPS measures to CMS on 
a designated Web page. The measures must address a gap in care. Outcome 
or other high priority types of measures are preferred. Simple 
documentation or ``check box'' measures are discouraged.
(5) QCDR Measure Specifications Requirements
    A QCDR must provide specifications for each measure, activity, or 
objective the QCDR intends to submit to CMS. We propose at Sec.  
414.1400(f) the QCDR must provide the following information:
     Provide descriptions and narrative specifications for, 
each measure activity, or objective for which it will submit to us by 
no later than January 15 of the applicable performance period for which 
the QCDR wishes to submit quality measures or other performance 
category (CPIA and advancing care information) data. In future years, 
starting with the 2018 performance period, those specifications must be 
provided to us by no later than November 1 prior to the applicable 
performance period for which the QCDR wishes to submit quality measures 
or other performance category (CPIA and advancing care information) 
data.
     For non-MIPS quality measures, the quality measure 
specifications must include: Name/title of measures, NQF number (if 
NQF-endorsed), descriptions of the denominator, numerator, and when 
applicable, denominator exceptions, denominator exclusions, risk 
adjustment variables, and risk adjustment algorithms. The narrative 
specifications provided must be similar to the narrative specifications 
we provide in our measures list. CMS will consider all non-MIPS 
measures submitted by the QCDR but the measures must address a gap in 
care and outcome or other high priority measures are preferred. 
Documentation or ``check box'' measures are discouraged. Measures that 
have very high performance rates already or address extremely rare gaps 
in care (thereby allowing for little or no quality distinction between 
MIPS eligible clinicians) are also unlikely to be approved for 
inclusion.
     For MIPS measures, the QCDR only needs to submit the MIPS 
measure numbers and/or the specialty-specific measure sets (if 
applicable).
     The QCDR must publicly post the measure specifications (no 
later than 15 days following our approval of these measure 
specifications) for each non-MIPS quality measure it intends to submit 
for MIPS. The QCDR may use any public format it prefers. Immediately 
following posting of the measures specification information, the QCDR 
must provide CMS with the link to where this information is posted. CMS 
will then post this information when it provides its list of QCDRs for 
the year.
(6) Identifying Non-MIPS Quality Measures
    To clarify the definition of a non-MIPS quality measures for 
purposes of QCDRs submitting data for the MIPS quality performance 
category, we propose at Sec.  414.1400(e) to consider the following 
types of quality measures to be non-MIPS quality measures:
     A measure that is not contained in the annual list of MIPS 
quality measures for the applicable performance period.
     A measure that may be in the annual list of MIPS quality 
measures but has substantive differences in the manner it is submitted 
by the QCDR. For example, if a MIPS quality measure is only reportable 
via the CMS Web Interface and a QCDR wishes to report this quality 
measure on behalf of its MIPS eligible clinicians, the quality measure 
would be considered a non-MIPS quality measure. This is because we 
would have only extracted the data collected from this quality measure 
using the CMS Web Interface, in which we utilize a claims-based 
assignment and sampling methodology to inform the groups on which 
patients they are to report, and the reporting of this quality measure 
would require changes to the way that the quality measure is calculated 
and reported to us via a QCDR instead of through the CMS Web Interface. 
Therefore, due to the substantive changes needed to report this quality 
measure via a QCDR, this CMS Web Interface quality measure would be 
considered a non-MIPS quality measure. CMS would not be able to 
directly compare MIPS eligible clinicians submitting the quality 
measure using the CMS Web Interface to those submitting the quality 
measure using the QCDR. Thus, this would be considered a non-MIPS 
quality measure.
     In addition, the CAHPS for MIPS survey currently could be 
submitted only using a CMS-approved survey vendor. Although the CAHPS 
for MIPS survey is proposed for inclusion in the MIPS measure set, we 
consider the changes that will need to be made available for reporting 
by individual

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MIPS eligible clinicians (and not as a part of a group) significant 
enough as to treat the CAHPS for MIPS survey as a non-MIPS quality 
measure for purposes of reporting the CAHPS for MIPS survey via a QCDR. 
To the extent that further clarification on the distinction between a 
MIPS and a non-MIPS measure is necessary, we will provide additional 
guidance on our Web site.
(7) Collaboration of Entities To Become a QCDR
    In the CY 2016 PFS final rule (80 FR 71136 through 71138) we 
finalized our proposal to allow collaboration of entities to become a 
QCDR based on our experience with the qualifying entities wishing to 
become QCDRs for performance periods. We received feedback from 
organizations who expressed concern that the entity wishing to become a 
QCDR may not meet the requirements of a QCDR solely on its own. We 
believe this policy supporting entity collaboration should be continued 
under MIPS. Therefore, we are proposing at Sec.  414.1400 that an 
entity that may not meet the requirements of a QCDR solely on its own 
but could do so in conjunction with another entity, would be eligible 
for qualification through collaboration with another entity.
    We propose to allow that an entity that uses an external 
organization for purposes of data collection, calculation, or 
transmission may meet the definition of a QCDR provided the entity has 
a signed, written agreement that specifically details the relationship 
and responsibilities of the entity with the external organization 
effective as of September 1 the year prior to the year for which the 
entity seeks to become a QCDR (for example, September 1, 2016, to be 
eligible to participate for purposes of the 2017 performance period). 
Entities that have a mere verbal, non-written agreement to work 
together to become a QCDR by September 1 the year prior to the year for 
which the entity seeks to become a QCDR would not fulfill this proposed 
requirement. We request comments on these proposals.
b. Health IT Vendors That Obtain Data From MIPS Eligible Clinician's 
Certified EHR Technology
    Currently, EHR-based systems are required to be considered 
certified EHR technology for multiple CMS quality programs. The Office 
of the National Coordinator for Health Information Technology (ONC) 
certification process has established standards and other criteria for 
structured data that EHRs must use. We propose to maintain this 
standard and require EHR-based data submission (whether transmitted 
directly from the EHR or from a data intermediary) to be certified EHR 
technology to submit quality measures, advancing care information, and 
CPIA data for MIPS. In addition, we propose at Sec.  414.1400(a)(4) 
that health IT vendors that obtain data from a MIPS eligible 
clinician's certified EHR technology, like other third party 
intermediaries, would have to meet all requirements designated by CMS 
as a condition of their qualification or approval to participate in 
MIPS as a third party intermediary. This includes submitting data in 
the form and manner specified by CMS as proposed at Sec.  
414.1400(a)(4)(ii). We anticipate that for the initial years of MIPS 
the form and manner requirements will be similar to what was used in 
the PQRS program however, at a minimum these will be modified to 
address the four performance categories under MIPS and MIPS data 
calculation needs. As we gain experience under MIPS we anticipate that 
these form and manner requirements may change in future years to ease 
reporting burden. Historical form and manner requirements under the 
PQRS program are available here: https://www.qualitynet.org/imageserver/pqrs/registry2015/index.htm or https://www.cms.gov/Regulations-and-Guidance/Legislation/EHRIncentivePrograms/Downloads/QRDA_2016_CMS_IG.pdf. In addition, health IT vendors must comply with 
our QRDA Implementation Guides if submitting data from a certified EHR 
technology, which we anticipate will be similar to the one noted above. 
We anticipate providing further subregulatory guidance that would 
identify the certified EHR technology data formats that providers must 
submit. In addition, we propose at Sec.  414.1325(b)(2) and (c)(2) to 
allow individual MIPS eligible clinicians and groups to submit data 
using certified EHR technology for the quality, CPIA, or advancing care 
information performance categories.
    Although section 1848(q)(5)(B)(ii)(I) of the Act specifically 
requires the Secretary to encourage MIPS eligible clinicians to report 
on applicable measures using EHR technology with respect to the quality 
performance category, the statute does not specifically address 
allowing a third party intermediary--such as a health IT vendor to 
submit on a MIPS eligible clinician's behalf for the other performance 
categories. Although we could limit the usage of health IT vendors 
assessing the quality performance category under MIPS, we believe it 
would be less burdensome for MIPS eligible clinicians if we expand the 
health IT vendors' capabilities. By allowing health IT vendors to 
report on the quality, advancing care information, and CPIA performance 
categories we would alleviate the need for individual MIPS eligible 
clinicians and groups to use a separate mechanism to report data for 
these performance categories. Our intention is to encourage health IT 
vendors to design systems to be able to accept new types of EHR data 
(for example, CPIA and advancing care information) from MIPS eligible 
clinicians and groups--this would be in addition to the quality measure 
data that we already can accept. Therefore, we are proposing at Sec.  
414.1400(a)(2) to expand health IT vendors' capabilities by allowing 
health IT vendors to submit data on measures, activities, or objectives 
for any of the following MIPS performance categories:
    (i) Quality;
    (ii) CPIA; or
    (iii) Advancing care information.
    As proposed at Sec.  414.1400(a)(1), health IT vendors submitting 
data on behalf of a MIPS eligible clinician or group would be required 
to obtain data from the MIPS eligible clinician's certified EHR 
technology. We believe this approach would permit a single health IT 
vendor to report on quality, advancing care information, and CPIA 
performance category requirements for MIPS and should mitigate the 
risks, costs, and burden of MIPS eligible clinicians having to report 
multiple times to meet the requirements of MIPS.
Health IT Vendors Data Requirements
    We further propose that health IT vendors must be able to do the 
following:
     For measures, activities, and objectives under the 
quality, advancing care information, and CPIA performance categories, 
and as proposed at Sec.  414.1400(a)(4)(i); if the data is derived from 
certified EHR technology, the health IT vendor must be able to indicate 
this data source.
     Either transmit data from the certified EHR technology or 
through a data intermediary in the CMS-specified form and manner, or 
have the ability for the individual MIPS eligible clinician and group 
to be able to submit data directly from their certified EHR technology, 
in the CMS-specified form and manner.
    For MIPS eligible clinicians who choose to electronically submit 
quality, advancing care information, and CPIA data extracted from their 
certified EHR technology to an intermediary, the

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intermediary would then submit the measure and activity data to CMS in 
a CMS-specified form and manner on the MIPS eligible clinician's behalf 
for the respective performance period. In addition to meeting the 
appropriate data submission criteria for the quality, advancing care 
information, and CPIA performance categories for the MIPS EHR 
submission mechanism, MIPS eligible clinicians who choose the EHR 
submission mechanism would be required to have certified EHR technology 
meeting the proposed definition at Sec.  414.1305. We request comments 
on these proposals.
c. Qualified Registries
    We propose to define a qualified registry at Sec.  414.1305 as a 
medical registry, a maintenance of certification program operated by a 
specialty body of the American Board of Medical Specialties or other 
data intermediary that, with respect to a particular performance 
period, has self-nominated and successfully completed a vetting process 
(as specified by CMS) to demonstrate its compliance with the MIPS 
qualification requirements specified by CMS for that performance 
period. The registry must have the requisite legal authority to submit 
MIPS data (as specified by CMS) on behalf of a MIPS eligible clinician 
or group to CMS. In addition, we are proposing at Sec.  414.1400(a)(2) 
to expand a qualified registry's capabilities by allowing qualified 
registries to submit data on measures, activities, or objectives for 
any of the following MIPS performance categories:
    (i) Quality;
    (ii) CPIA; or
    (iii) Advancing care information, if the MIPS eligible clinician or 
group is using certified EHR technology.
(1) Establishment of an Entity Seeking To Qualify as a Registry
    We propose at Sec.  414.1400(h) that in order for an entity to 
become qualified for a given performance period as a qualified 
registry, the entity must be in existence as of January 1 of the 
performance period for which the entity seeks to become a qualified 
registry (for example, January 1, 2017, to be eligible to participate 
for purposes of performance periods beginning in 2017). The qualified 
registry must have at least 25 participants by January 1 of the 
performance period. These participants do not necessarily need to be 
using the qualified registry to report MIPS data to us; rather, they 
need to be submitting data to the qualified registry for quality 
improvement. We also propose a qualified registry must provide 
attestation statements from the qualified registry/MIPS eligible 
clinicians during the data submission period that all of the data 
(quality measures, CPIAs, and advancing care information measures and 
objectives, if applicable) and results are accurate and complete.
(2) Self-Nomination Period
    For the 2017 performance period, we propose at Sec.  414.1400(g) a 
self-nomination period from November 15, 2016 until January 15, 2017. 
For future years of the program, starting with the 2018 performance 
period, we propose to establish the self-nomination period from 
September 1 of the prior year until November 1 of the year in which the 
qualified registry seeks to be qualified. Entities that desire to 
qualify as a qualified registry for purposes of MIPS for a given 
performance period would need to provide all requested information to 
CMS at the time of self-nomination and would need to self-nominate for 
that performance period. Having qualified as a qualified registry does 
not automatically qualify the entity to participate in subsequent MIPS 
performance periods. For example, a qualified registry may choose not 
to continue participation in the program in future years, OR the 
qualified registry may be precluded from participation in a future 
year, due to multiple data or submission errors as noted below. As 
such, CMS believes an annual self-nomination process is the best 
process to ensure accurate information is conveyed to MIPS eligible 
clinicians and accurate data is submitted to MIPS.
    We propose to require further information (described below) of 
qualified registries at the time of self-nomination. If an entity 
becomes qualified as a qualified registry, they will need to sign a 
statement confirming this information is correct prior to us listing 
their qualifications on their Web site. Once we post the qualified 
registry on our Web site, including the services offered by the 
qualified registry, we will require the qualified registry to support 
these services/measures for its clients as a condition of the entity's 
qualification as a qualified registry for purposes of MIPS. Failure to 
do so will preclude the qualified registry from participation in MIPS 
in the subsequent performance year.
(3) Information Required at the Time of Self-Nomination
    We propose that a qualified registry must provide the following 
information to us at the time of self-nomination:
     Organization Name (Specify Sponsoring Organization name 
and software vendor name if the two are different. For example, a 
specialty society in collaboration with a software vendor).
     MIPS performance categories (that is, categories for which 
the entity is self-nominating to report. For example, quality measures, 
advancing care information, and/or CPIA).
     Performance Period.
     Vendor Type (for example, qualified registry).
     Provide the method(s) by which the entity obtains data 
from its customers for each performance category for which it is 
approved: Claims; web-based tool; practice management system; certified 
EHR technology; other (please explain). If a combination of methods 
(Claims, web-based tool, Practice Management System, certified EHR 
technology, and/or other) is utilized, please state which method(s) the 
entity utilizes to collect data (performance numerator and 
denominator).
     Indicate the method the entity will use to verify the 
accuracy of each TIN/NPI and/or TIN it is intending to submit (for 
example; National Plan and Provider Enumeration System (NPPES), CMS 
claims, tax documentation).
     Describe the method the entity will use to accurately 
calculate performance rates for quality measures based on the 
appropriate measure type and specification. For composite measures or 
measures with multiple performance rates, the entity must provide us 
with the methodology the entity uses to calculate these composite 
measures and measures with multiple performance rates. The entity 
should be able to report to us a calculated composite measure rate, if 
applicable.
     Describe the method that the entity will use to accurately 
calculate performance data for CPIA and advancing care information 
performance categories based on the appropriate parameters or 
activities.
     Describe the process that the entity will use for 
completion of a randomized audit of a subset of data prior to the 
submission to us (for all performance categories the qualified registry 
is submitting data on; that is, quality, CPIA, and advancing care 
information, as applicable). Periodic examinations may be completed to 
compare patient record data with submitted data and/or ensure MIPS 
quality measures or other performance category (CPIA and advancing care 
information) activities, measures, or objectives were accurately 
reported and performance calculated based on the appropriate measure 
specifications (that is, accuracy of numerator, denominator, and 
exclusion criteria) or performance category requirements.

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     Provide information on the entity's process for data 
validation for both individual MIPS eligible clinicians and groups 
within a data validation plan. For example, for individuals, it is 
encouraged that 3 percent of the MIPS eligible clinicians submitted to 
CMS by the qualified registry be sampled with a minimum sample of 10 
TIN/NPIs or a maximum sample of 50 MIPS eligible clinicians. For each 
MIPS eligible clinician sampled, it is encouraged that 25 percent of 
the MIPS eligible clinicians' patients (with a minimum sample of five 
patients or a maximum sample of 50 patients) should be reviewed for all 
measures applicable to the patient.
     Provide the results of the executed data validation plan 
by May 31st of the year following the performance period. If the 
results indicate the qualified registry's validation reveals inaccuracy 
or low compliance provide to us an improvement plan. Failure to 
implement improvements may result in the qualified registry being 
placed in a probationary status or disqualification from future 
participation.
(4) Qualified Registry Requirements for Data Submission
    Further, we propose that a qualified registry must perform the 
following functions:
     For measures, activities, and objectives under the 
quality, advancing care information, and CPIA performance categories 
and as proposed at Sec.  414.1400(a)(4)(i); if the data is derived from 
certified EHR technology, the qualified registry must be able to 
indicate this data source.
     A qualified registry submitting MIPS quality measures that 
are risk-adjusted (and have the risk-adjusted variables and methodology 
listed in the measure specifications) must submit the risk-adjusted 
measure results to CMS when submitting the data for these measures.
     Submit to us, quality measures and activities data on all 
patients, not just Medicare patients.
     Submit quality measures, advancing care information, or 
CPIA performance categories data and results to us in the applicable 
MIPS performance categories for which the qualified registry is 
providing data.
     Provide timely feedback, at least 4 times a year, on all 
of the MIPS performance categories that the qualified registry will 
report to us. That is, if the qualified registry will be reporting on 
data for the CPIA, advancing care information, or quality performance 
category, all results as of the feedback report date should be included 
in the information sent to the MIPS eligible clinician. The feedback 
should be given to the individual MIPS eligible clinician or group (if 
participating as a group) at the individual participant level or group 
level, as applicable, for which the qualified registry reports. The 
qualified registry is only required to provide feedback based on the 
MIPS eligible clinician's data that is available at the time the 
feedback report is generated.
     A qualified registry must comply with any request by us to 
review the data submitted by the qualified registry for purposes of 
MIPS in accordance with applicable law. Specifically, data requested 
would be limited to the minimum necessary for us to carry out, for 
example, health care operations or health oversight activities.
     Mandatory participation in ongoing support conference 
calls hosted by us (approximately one call per month), including an in-
person qualified registry kick-off meeting (if held) at our 
headquarters in Baltimore, MD. More than one unexcused absence could 
result in the qualified registry being precluded from participation in 
the program for that year. If a qualified registry is precluded from 
participation in MIPS, the individual MIPS eligible clinician or group 
would need to find another entity to submit their MIPS data.
     Agree that data inaccuracies including (but not limited 
to) TIN/NPI mismatches, formatting issues, calculation errors, data 
audit discrepancies affecting in excess of 3 percent of the total 
number of MIPS eligible clinicians submitted by the qualified registry 
may result in notations on our qualified registry posting of low data 
quality and would place the qualified registry on probation (if they 
decide to self-nominate for the next program year). If the qualified 
registry does not reduce their data error rate below 3 percent in the 
subsequent year, they would continue to be on probation and have their 
listing on the CMS Web site continue to note the poor quality of the 
data they are submitting for MIPS. Data errors affecting in excess of 5 
percent of the MIPS eligible clinicians submitted by the qualified 
registry may lead to the disqualification of the qualified registry 
from participation in the following year's program. As we gain 
additional experience with qualified registries, we intend to revisit 
and enhance these thresholds in future years.
     Be able to report at least six quality measures including 
one cross-cutting measure and one outcome measure. If an outcome 
measure is not available, be able to report another high priority 
measure (appropriate use, patient safety, efficiency, patient 
experience, and care coordination measures).
     Enter into and maintain with its participating clinicians 
an appropriate Business Associate agreement that provides for the 
qualified registry's receipt of patient-specific data from an 
individual MIPS eligible clinician or group, as well as the qualified 
registry's disclosure of quality measure results and numerator and 
denominator data and/or patient specific data on Medicare and non-
Medicare beneficiaries on behalf of MIPS eligible clinicians or group.
     Obtain and keep on file signed documentation that each 
holder of an NPI whose data are submitted to the qualified registry, 
has authorized the qualified registry to submit quality measure 
results, CPIA measure and activity results, advancing care information 
objective results and numerator and denominator data and/or patient-
specific data on Medicare and non-Medicare beneficiaries to us for the 
purpose of MIPS participation. This documentation must be obtained at 
the time the MIPS eligible clinician or group signs up with the 
qualified registry to submit MIPS data to the qualified registry and 
must meet any applicable laws, regulations, and contractual business 
associate agreements. Groups participating in MIPS via a qualified 
registry may have their group's duly authorized representative grant 
permission to the qualified registry to submit their data to us. If 
submitting as a group each individual MIPS eligible clinician does not 
need to grant their individual permission to the qualified registry to 
submit their data to us.
     Not be owned and managed by an individual locally-owned 
single specialty group (for example, single specialty practices with 
only one practice location or solo practitioner practices are 
prohibited from self-nominating to become a MIPS qualified registry).
     Be able to separate out and report on all payers, 
including Medicare Part B FFS patients and non-Medicare patients.
     Provide the measure numbers for the MIPS quality measures 
on which the qualified registry is reporting.
     Provide the measure title (and specialty-specific measure 
set title, if applicable) for the MIPS quality measures and CPIAs (if 
applicable) on which the qualified registry is reporting.
     Indicate if the qualified registry will be reporting the 
advancing care information component measures and objectives.

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     Report the number of eligible instances (reporting 
denominator).
     Report the number of instances a quality service is 
performed (performance numerator).
     Report the number of performance exclusions, meaning the 
quality action was not performed for a valid reason as defined by the 
measure specification.
     Comply with a CMS-specified secure method for data 
submission, such as submitting the qualified registry's data in an XML 
file.
     Sign a document verifying the qualified registry's name, 
contact information, cost for MIPS eligible clinicians or groups to use 
the qualified registry, services provided, and the specialty-specific 
measure sets the qualified registry intends to report. Once posted on 
the qualified registry's CMS Web site, the qualified registry will need 
to support the measures/measure sets confirmed by the qualified 
registry. Failure to do so will may preclude the qualified registry 
from participation in MIPS in the subsequent year.
     Must provide attestation statements during the data 
submission period that all of the data (quality measures, CPIAs, and 
advancing care information measures and objectives, if applicable) and 
results are accurate and complete.
     For purposes of distributing feedback reports to MIPS 
eligible clinicians, collect a MIPS eligible clinician's email 
address(es) and have documentation from the MIPS eligible clinician 
authorizing the release of his or her email address.
     Be able to calculate and submit measure-level reporting 
rates or, upon request, the data elements needed to calculate the 
reporting and performance rates by TIN/NPI and/or TIN.
     Be able to calculate and submit, by TIN/NPI and/or TIN, a 
performance rate (that is the percentage of a defined population who 
receive a particular process of care or achieves a particular outcome 
based on a calculation of the measures' numerator and denominator 
specifications) for each measure on which the TIN/NPI and/or TIN 
reports or, upon request the Medicare and non-Medicare level data 
elements needed to calculate the performance rates.
     Provide the performance period start date the qualified 
registry will cover.
     Provide the performance period end date the qualified 
registry will cover.
     Report the number of instances in which the applicable 
submission criteria were not met, for example, the quality measure was 
not reported and a performance exclusion did not apply.
     For data validation purposes, provide information on the 
entity's sampling methodology. For example, if is encouraged that 3 
percent of the MIPS eligible clinicians be sampled with a minimum 
sample of 10 MIPS eligible clinicians or a maximum sample of 50 MIPS 
eligible clinicians. For each MIPS eligible clinician sampled, it is 
encouraged that 25 percent of the MIPS eligible clinicians' patients 
(with a minimum sample of five patients or a maximum sample of 50 
patients) should be reviewed for all measures applicable to the 
patient.
    We request comments on these proposals.
d. CMS-Approved Survey Vendors
    As discussed in the section II.E.5.b. we propose to allow groups to 
report CAHPS for MIPS survey measures. We propose the data collected on 
the CAHPS for MIPS survey measures would be transmitted to us via a 
CMS-approved survey vendor.
    For purposes of MIPS, we propose to define a CMS-approved survey 
vendor at Sec.  414.1305 as a survey vendor that is approved by CMS for 
a particular performance period to administer the CAHPS for MIPS survey 
and transmit survey measures data to CMS. We propose at Sec.  
414.1400(i) that vendors are required to undergo the CMS approval 
process for each year in which the survey vendor seeks to transmit 
survey measures data to CMS. We anticipate retaining the same policies 
and procedures we currently follow for a CMS-approved survey vendor for 
PQRS and apply them to a MIPS CMS-approved survey vendor. We propose 
the following requirements for a CMS-approved survey vendor for the 
CAHPS for MIPS survey. A CMS-approved survey vendor for CAHPS for MIPS 
must:
    (1) Comply with and complete the Vendor Participation Form--We 
anticipate retaining the same application process and Vendor 
Participation Form that was required for the CAHPS for PQRS survey. 
Please refer to http://www.pqrscahps.org/en/participation-form/ for 
further details. Therefore, we are proposing at Sec.  414.1400(i) that 
all CMS-approved survey vendor applications and materials will be due 
April 30 of the performance period. However, we do seek comments on 
whether the deadline for CMS-approved survey vendor applications and 
materials should be earlier, such as prior to the beginning of the 
performance period. In addition, we propose the following items will be 
required for your organization to be a CMS-approved survey vendor of 
the CAHPS for MIPS Survey:
     Meet all of the Minimum Survey Vendor Business 
Requirements at the time of the submission of the Vendor Participation 
Form; and
     Complete the Vendor Participation Form.
    (2) Comply with the Minimum Survey Vendor Business Requirements--We 
anticipate retaining the same minimum survey business requirements that 
were required for the CAHPS for PQRS survey. Please refer to http://www.pqrscahps.org/en/business-requirements/ for further details. We 
propose Applicant Organizations (survey vendor and subcontractors) must 
possess all required facilities and systems to implement the CAHPS for 
MIPS Survey. Subcontractors will be subject to the same requirements as 
the applicant vendor. Organizations that are approved to administer the 
CAHPS for MIPS Survey must conduct all their CAHPS for MIPS business 
operations within the United States. This requirement applies to all 
staff and subcontractors. In addition, we propose to request 
information regarding:
     Relevant organization and survey experience.
     Survey capability and capacity.
     Adherence to quality assurance guidelines and 
participation in quality assurance activities.
     Documentation requirements.
     Adhere to all protocols and specifications, and agree to 
participate in training sessions.
    Specifically, to obtain our approval, we propose that survey 
vendors would be required to undergo training, meet our standards on 
how to administer the survey, and submit a quality assurance plan. We 
would provide the identified survey vendor with an appropriate sample 
frame of beneficiaries from each group that has contracted with the 
survey vendor and elected to participate in the CAHPS for MIPS survey. 
The survey vendor would also be required to administer the survey 
according to established protocols to ensure valid and reliable 
results. More information on quality assurance and protocols can be 
reviewed at http://www.pqrscahps.org/en/quality-assurance-guidelines/. 
CMS-approved survey vendors would be supplied with mail and telephone 
versions of the survey in electronic form, and text for beneficiary 
pre-notification and cover letters. CAHPS for MIPS surveys can be 
administered in English, Spanish, Cantonese, Mandarin, Korean, Russian 
and/or Vietnamese. Survey vendors would be required to use appropriate 
quality control, encryption, security and backup procedures to maintain 
survey response data. The data would then be securely

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sent back to us for scoring and/or validation in accordance with 
applicable law. To ensure that a survey vendor possesses the ability to 
transmit survey measures data for a particular performance period, we 
propose to require survey vendors to undergo this approval process for 
each year in which the survey vendor seeks to transmit survey measures 
data to us. We request comments on this proposal.
e. Probation and Disqualification of a Third Party Intermediary
    We propose at Sec.  414.1400(k) a process for placing third party 
intermediaries on probation and for disqualifying such entities for 
failure to meet certain standards established by CMS. Specifically, we 
propose that if at any time we determine that a third party 
intermediary (that is, a QCDR, health IT vendor, qualified registry, or 
CMS-approved survey vendor) has not met all of the applicable 
requirements for qualification, we may place the third party 
intermediary on probation for the current performance period and/or the 
following performance period, as applicable.
    In addition, we propose CMS requires a corrective action plan from 
the third party intermediary to address any deficiencies or issues and 
prevent them from recurring. We propose the corrective action plan must 
be received and accepted by CMS within 14 days of the CMS notification 
to the third party intermediary of the deficiencies or probation. 
Failure to comply with this would lead to disqualification from MIPS 
for the subsequent performance period.
    We propose probation to mean that, for the applicable performance 
period, the third party intermediary would not be allowed to miss any 
meetings or deadlines and would need to submit a corrective action plan 
for remediation or correction of deficiencies identified that resulted 
in the probation.
    In addition, we propose that if the third party intermediary has 
data inaccuracies including (but not limited to) TIN/NPI mismatches, 
formatting issues, calculation errors, data audit discrepancies 
affecting in excess of 3 percent (but less than 5 percent) of the total 
number of MIPS eligible clinicians or groups submitted by the third 
party intermediary, CMS would annotate on the CMS qualified posting 
that the third party intermediary furnished data of poor quality and 
would place the entity on probation for the subsequent MIPS performance 
period with the opportunity to go on probation for a year to correct 
their deficiencies.
    Further, we propose if the third party intermediary does not reduce 
their data error rate below 3 percent for the subsequent performance 
period, the third party intermediary would continue to be on probation 
and have their listing on the CMS Web site continue to note the poor 
quality of the data they are submitting for MIPS for one additional 
performance year. After two years on probation, the third party 
intermediary would be disqualified for the subsequent performance year. 
Data errors affecting in excess of 5 percent of the MIPS eligible 
clinicians or groups submitted by the third party intermediary may lead 
to the disqualification of the third party intermediary from 
participation for the following performance period. In placing the 
third party intermediary on probation; we would notify the third party 
intermediary of the identified issues, at the time of discovery of such 
issues.
    Finally, we propose if the third party intermediary does not submit 
an acceptable corrective action plan within 14 days of notification of 
the deficiencies and correct the deficiencies within 30 days or before 
the submission deadline--whichever is sooner, we may disqualify the 
third party intermediary from participating in MIPS for the current 
performance period and/or the following performance period, as 
applicable. We request comments on these proposals.
(f) Auditing of Third Party Intermediaries Submitting MIPS Data
    We propose at Sec.  414.1400(j) that any third party intermediary 
(that is, a QCDR, health IT vendor, qualified registry, or CMS-approved 
survey vendor) must comply with certain auditing requirements as a 
condition of their qualification or approval to participate in MIPS as 
a third party intermediary. Specifically, we propose the entity must 
make available to CMS the contact information of each MIPS eligible 
clinician or group on behalf of whom it submits data. The contact 
information will include, at a minimum, the MIPS eligible clinician or 
group's practice phone number, address, and, if available, email. 
Further, we propose the entity must retain all data submitted to CMS 
for MIPS for a minimum of 10 years. We request comments on this 
proposal.
10. Public Reporting on Physician Compare
    This section contains the proposed approach for publicly reporting 
on Physician Compare for the MIPS, APM, and other information as 
required by the MACRA.
    Physician Compare draws its operating authority from section 
10331(a)(1) of the Affordable Care Act. As required, by January 1, 
2011, we developed a Physician Compare Internet Web site with 
information on physicians enrolled in the Medicare program under 
section 1866(j) of the Act, as well as information on other EPs who 
participate in the PQRS under section 1848 of the Act. More information 
on Physician Compare can be accessed on the Physician Compare 
Initiative Web site at https://www.cms.gov/medicare/quality-initiatives-patient-assessment-instruments/physician-compare-initiative/.
    The first phase of Physician Compare was launched on December 30, 
2010 (http://www.medicare.gov/physiciancompare). Since the initial 
launch, Physician Compare has been continually improved and more 
information has been added. Currently, Web site users can view 
information about approved Medicare professionals, such as name, 
Medicare primary and secondary specialties, practice locations, group 
affiliations, hospital affiliations that link to the hospital's profile 
on Hospital Compare as available, Medicare Assignment status, 
education, residency, and American Board of Medical Specialties (ABMS) 
board certification information. For group practices, users can view 
group practice names, specialties, practice locations, Medicare 
assignment status, and affiliated professionals. In addition, Medicare 
professionals and group practices that satisfactorily or successfully 
participated in a CMS quality program have a green check mark on their 
profile page to indicate their commitment to quality.
    Consistent with section 10331(a)(2) of the Affordable Care Act, 
Physician Compare also phased in public reporting of information on 
physician performance that provides comparable information on quality 
and patient experience measures for reporting periods beginning January 
1, 2012. To the extent that scientifically sound measures are developed 
and are available, Physician Compare is required to include, to the 
extent practicable, the following types of measures for public 
reporting: Measures collected under PQRS and an assessment of 
efficiency, patient health outcomes, and patient experience, as 
specified. The first set of quality measures were publicly reported on 
Physician Compare in February 2014. Currently, Physician Compare 
publicly reports 14 group practice level measures

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collected through the Web Interface for groups of 25 or more EPs 
participating in 2014 under the PQRS and for ACOs participating in the 
Shared Savings Program or Pioneer ACO program, and six individual level 
measures collected through claims for individual EPs participating in 
2014 under the PQRS. A complete history of public reporting on 
Physician Compare is detailed in the CY 2016 PFS final rule (80 FR 
71117-22).
    As finalized in the CY 2015 and CY 2016 PFS final rules (79 FR 
67547 and 80 FR 70885) Physician Compare will expand public reporting 
over the next several years. This expansion includes publicly reporting 
both individual EP and group practice level QCDR measures starting with 
2015 individual EP measures to be publicly reported on Physician 
Compare in late 2016, and expanding to group practice QCDR measures in 
late 2017 (80 FR 71125), which is consistent with section 101(d)(1)(B) 
of the MACRA.
    Section 1848(q)(9)(A) and (D) of the Act facilitates the 
continuation of the phased approach to public reporting by requiring 
the Secretary to make available on the Physician Compare Web site, in 
an easily understandable format, individual MIPS eligible clinician and 
groups performance information, including:
     The MIPS eligible clinician's CPS;
     The MIPS eligible clinician's performance under each MIPS 
performance category (quality, resource use, CPIA and advancing care 
information);
     Names of eligible clinician's in Advanced APMs and, to the 
extent feasible, the names of such Advanced APMs and the performance of 
such models; and
     Periodically post aggregate information on the MIPS, 
including the range of composite scores for all MIPS eligible 
clinician's and the range of the performance of all MIPS eligible 
clinician's with respect to each performance category.
    Section 1848(q)(9)(B) of the Act also requires that this 
information indicate, where appropriate, that publicized information 
may not be representative of the eligible clinician's entire patient 
population, the variety of services furnished by the eligible 
clinician, or the health conditions of individuals treated. In order to 
ensure the information mandated under section 1848(q)(9) of the Act are 
publicly reported, the information must be in compliance with the 
existing mandate and regulations previously established under section 
10331(a)(2) and 10331(b) of the Affordable Care Act. As required under 
section 10331(a)(2) of the Affordable Care Act, all measure data 
included on Physician Compare must be comparable. In addition, section 
10331(b) of the Affordable Care Act requires that we include, to the 
extent practicable, processes to ensure that data made public are 
statistically valid, reliable, and accurate, including risk adjustment 
mechanisms used by the Secretary. In addition to the Affordable Care 
Act informed public reporting standards--statistically valid and 
reliable data, that are accurate and comparable--existing regulation 
notes that all the data must also prove through consumer testing to 
resonate with and be accurately interpreted by consumers in order to be 
included on Physician Compare profile pages. Together, we refer to 
these conditions as the Physician Compare public reporting standards 
(80 FR 71118-20). Section 10331(d) of the Affordable Care Act also 
requires us to consider input from multi-stakeholder groups, consistent 
with sections 1890(b)(7) and 1890A of the Act. We also continue to 
receive general input from stakeholders on Physician Compare through a 
variety of means, including rulemaking and different forms of 
stakeholder outreach (for example, Town Hall meetings, Open Door 
Forums, webinars, education and outreach, Technical Expert Panels, 
etc.).
    In addition, section 1848(q)(9)(C) of the Act requires the 
Secretary to provide an opportunity for MIPS eligible clinicians to 
review the information that will be publicly reported prior to such 
information being made public. This is generally consistent with 
section 10331(a)(2) of the Affordable Care Act and current regulations 
that established a 30-day preview period for all measurement 
performance data that will allow physicians and other EPs to view their 
data as it will appear on the Web site in advance of publication on 
Physician Compare (80 FR 71120). Section 1848(q)(9)(C) of the Act also 
requires that MIPS eligible clinicians be able to submit corrections 
for the information to be made public. We propose that this extension 
of the current Physician Compare 30-day preview period will be 
implemented starting with data from the 2017 MIPS performance period. 
We propose a 30-day preview period in advance of the publication of any 
data on Physician Compare. We will coordinate efforts between Physician 
Compare and the four components of MIPS in terms of data review and 
appeal and any relevant data resubmission or correction. All data 
available for public reporting--measure rates, scores, and/or 
attestations--will be available for review and correction during the 
targeted review process (see section II.E.8.c. of this proposed rule). 
The process will begin at least 30 days in advance of the publication 
of new data. Data under appeal and review will not be publicly reported 
until the review is complete. All corrected measure rates, scores, and/
or attestations submitted will be available for public reporting. The 
technical details of the process will be communicated directly to 
affected MIPS eligible clinicians and groups and detailed outside of 
rulemaking.
    As with the current process, the details will be made public on the 
Physician Compare Initiative page on cms.gov and communicated through 
Physician Compare and other CMS listservs.
    In addition, section 1848(q)(9)(D) of the Act requires that 
aggregate information on the MIPS be periodically posted on the 
Physician Compare Web site; including the range of composite scores for 
all MIPS eligible clinicians and the range of performance for all MIPS 
eligible clinicians with respect to each performance category.
    Lastly, section 104 of the MACRA requires the Secretary to make 
publicly available, on an annual basis (beginning with 2015), in an 
easily understandable format, information with respect to physicians 
and other eligible clinician's on items and services furnished to 
Medicare beneficiaries, and to include, at a minimum:
     Information on the number of services furnished under Part 
B, which may include information on the most frequent services 
furnished or groupings of services;
     Information on submitted charges and payments for Part B 
services; and
     A unique identifier for the physician or other eligible 
clinician that is available to the public, such as an NPI.
    The information would further be required to be made searchable by 
at least specialty or type of physician or other eligible clinician; 
characteristics of the services furnished (such as, volume or groupings 
of services); and the location of the physician or other eligible 
clinician.
    Therefore, at Sec.  414.1395(a) we propose public reporting of an 
eligible clinician's MIPS data; in that for each program year, we would 
post on a public Web site, in an easily understandable format, 
information regarding the performance of MIPS eligible clinicians or 
groups under the MIPS.
    Furthermore, in accordance with section 104(e) of the MACRA, we 
finalized in the CY 2016 PFS final rule

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(80 FR 71130) to add utilization data to the Physician Compare 
downloadable database. Utilization data is currently available at 
http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/Physician-and-Other-Supplier.html. As finalized (80 FR 71130), this information will be 
integrated on the Physician Compare Web site via the downloadable 
database targeted for late 2016. Not all available data will be 
included. The specific HCPCS codes included will be determined based on 
analysis of the available data, focusing on the most used codes. 
Additional details about the specific HCPCS codes that will be included 
in the downloadable database will be provided to stakeholders in 
advance of data publication. And, all data available for public 
reporting--on the consumer-facing Web site pages or in the downloadable 
database--will be available for preview during the 30-day preview 
period.
    We believe section 10331 of the Affordable Care Act supports our 
overarching goals of the MACRA by providing consumers with quality 
information that will help them make informed decisions about their 
health care, while encouraging clinicians to improve the quality of 
care they provide to their patients. In accordance with section 10331 
of the Affordable Care Act, section 1848(q)(9) of the Act, and section 
104(e) of the MACRA, we plan to continue to publicly report performance 
information on Physician Compare. As a result, we propose inclusion of 
the following information on Physician Compare.
a. Composite Score, Performance Categories, and Aggregate Information
    As noted, section 1848(q)(9)(A) and (D) of the Act requires that we 
publicly report on Physician Compare the composite score for each MIPS 
eligible clinician, performance of each MIPS eligible clinician for 
each performance category, and periodically post aggregate information 
on the MIPS, including the range of composite scores for all MIPS 
eligible clinicians and the range of performance of all the MIPS 
eligible clinicians for each performance category. We propose that 
these data, to the extent that they meet the previously established 
public reporting standards, will be added to Physician Compare for each 
MIPS eligible clinician or group, either on the profile pages or in the 
downloadable database, as technically feasible. Statistical testing and 
consumer testing, as well as consultation of the Physician Compare 
Technical Expert Panel (TEP), will determine how and where these data 
are reported on Physician Compare. We request comments on these 
proposals.
    In addition, we seek comment on the advisability and technical 
feasibility of including data voluntarily reported by EPs and groups 
that are not subject to MIPS payment adjustments, such as those 
practicing through RHC, FQHCs, etc., on Physician Compare. Any 
regulatory changes would be made through separate notice-and-comment 
rulemaking.
b. Quality
    The quality performance category is discussed in detail in section 
II.E.5.b. of this proposed rule. Consistent with the current policy 
that makes all current PQRS measures available for public reporting, we 
now propose to make all measures under the MIPS quality performance 
category (see section II.E.5.b. of this proposed rule) available for 
public reporting on Physician Compare. This includes all available 
measures reported via all available submission methods, and applies to 
both MIPS eligible clinicians and groups.
    Also consistent with current policy, although all measures will be 
available for public reporting not all measures will be made available 
on the consumer-facing Web site profile pages. As explained in the CY 
2016 PFS final rule (80 FR 71120), providing too much information can 
overwhelm consumers and lead to poor decision making. Therefore, we 
propose that all measures in the quality performance category that meet 
the public reporting standards would be included in the downloadable 
database, as technically feasible. We also propose that a subset of 
these measures would be publicly reported on the Web site's profile 
pages, as technically feasible. Statistical testing and consumer 
testing will determine how and where measures are reported on Physician 
Compare. In addition, we do not publicly report first year measures, 
meaning new measures that have been in use for less than 1 year, 
regardless of submission methods. After a measure's first year in use, 
we will evaluate the measure to see if and when the measure is suitable 
for pubic reporting (80 FR 71118).
    Currently, there is a minimum sample size requirement of 20 
patients for performance data to be included on the Web site. As part 
of the MIPS and APMs RFI we asked for comment on moving away from this 
requirement and moving to a reliability threshold for public reporting. 
In general, commenters supported a minimum reliability threshold. As a 
result, we are now proposing to institute a minimum reliability 
threshold for public reporting on Physician Compare.
    The reliability of a measure refers to the extent to which the 
variation in measure is due to variation in quality of care as opposed 
to random variation due to sampling. Statistically, reliability depends 
on performance variation for a measure across entities, the random 
variation in performance for a measure within an entity's panel of 
attributed beneficiaries, and the number of beneficiaries attributed to 
the entity. High reliability for a measure suggests that comparisons of 
relative performance across entities, in this case groups or eligible 
clinicians, are likely to be stable and consistent, and that the 
performance of one entity on the quality measure can confidently be 
distinguished from another. Conducting analysis to determine 
reliability of the data collected will allow us to calculate the 
minimum reliability threshold for those data. Once an appropriate 
minimum reliability threshold is determined, the reporting of 
reporters' performance rates for a given measure can be restricted to 
only those meeting the minimum reliability threshold.
    We propose to also include the total number of patients reported on 
per measure in the downloadable database to facilitate transparency and 
more accurate understanding and use of the data. We request comments on 
these proposals.
    We also are seeking comment on the types of data that should be 
reported on Physician Compare as the MIPS program evolves, specifically 
in regard to the quality performance category. Any regulatory changes 
would be made in separate notice-and-comment rulemaking.
c. Resource Use
    The resource use performance category is detailed in section 
II.E.5.e. of this proposed rule. We propose to make all measures under 
the MIPS resource use performance category (see section II.E.5.e. of 
this proposed rule) available for public reporting on Physician 
Compare. This includes all available measures reported via all 
available submission methods, and applies to both MIPS eligible 
clinicians and groups.
    We have found that resource use data do not resonate with consumers 
and can instead lead to significant misinterpretation and 
misunderstanding. Therefore, we propose to include a sub-set of 
resource use measures, that meet the aforementioned public reporting 
standards, on Physician Compare, either

[[Page 28292]]

on profile pages or in the downloadable database, if technically 
feasible. Statistical testing and consumer testing will determine how 
and where measures are reported on Physician Compare. In addition, we 
do not publicly report first year measures, meaning new measures that 
have been in use for less than 1 year, regardless of submission 
methods. After a measure's first year in use, we will evaluate the 
measure to see if and when the measure is suitable for pubic reporting 
(80 FR 71118). We request comments on these proposals.
    We also are seeking comment on the types of data that should be 
reported on Physician Compare as the MIPS program evolves, specifically 
in regard to the resource use performance category. Any regulatory 
changes would be made in separate notice-and-comment rulemaking.
d. CPIA
    The CPIA performance category is detailed in section II.E.5.f. of 
this proposed rule. We propose to make all activities under the MIPS 
CPIA performance category (see section II.E.5.f. of this proposed rule) 
available for public reporting on Physician Compare. This includes all 
available CPIAs reported via all available submission methods, and 
applies to both MIPS eligible clinicians and groups.
    We propose to include a subset of CPIA data that meet the 
aforementioned public reporting standards, on Physician Compare, either 
on the profile pages or in the downloadable database, if technically 
feasible. For those eligible clinicians that successfully meet the CPIA 
performance category requirements this may be posted on Physician 
Compare as an indicator. The CPIA performance category is a new field 
of data for Physician Compare so concept and consumer testing will be 
needed to ensure these data are understood by consumers. Therefore, 
statistical testing and consumer testing will determine how and where 
CPIAs are reported on Physician Compare. In addition, since we do not 
publicly report first year measures, we are also applying this policy 
to CPIA, meaning new CPIAs that have been in use for less than 1 year, 
regardless of submission methods. After a CPIA's first year in use, we 
will evaluate the activity to see if and when the activity is suitable 
for pubic reporting (80 FR 71118). We request comments on these 
proposals.
    We also are seeking comment on the types of data that should be 
reported on Physician Compare as the MIPS program evolves, specifically 
in regard to the CPIA performance category. Any regulatory changes 
would be made in separate notice-and-comment rulemaking.
e. Advancing Care Information
    Since the beginning of the EHR Incentive Programs in 2011, 
participant performance data has been publically available in the form 
of public use files on the CMS Web site. In the 2015 EHR Incentive 
Programs final rule, we addressed comments requesting that CMS not only 
continue this practice but also include a wider range of information on 
participation and performance. In that rule, we stated our intent to 
publish the performance and participation data on Stage 3 objectives 
and measures of meaningful use in alignment with quality programs which 
utilize publicly available performance data such as Physician Compare 
(80 FR 62901). At this time there is only a green check mark on 
Physician Compare profile pages to indicate that an EP successfully 
participated in the current Medicare EHR Incentive Program for EPs.
    As MIPS will now include advancing care information as one of the 
four MIPS performance categories, we are proposing to include more 
information on eligible clinician's performance on the objectives and 
measures of meaningful use on Physician Compare. An important 
consideration is that to meet the aforementioned public reporting 
standards, the data added to Physician Compare must resonate with the 
average Medicare consumer and their caregivers. Consumer testing to 
date has shown that people with Medicare value the use of certified EHR 
technology and see EHR use as something that if used well can improve 
the quality of their care. In addition, we believe the inclusion of 
indicators for providers who achieve high performance in key care 
coordination and patient engagement activities provide significant 
value for consumers.
    We are therefore proposing to include an indicator for any eligible 
clinician or group who successfully meets the advancing care 
information performance category, as detailed in section II.E.5.g. of 
this proposed rule, as technically feasible on Physician Compare. Also 
as technically feasible, we are proposing to include additional 
indicators, including but not limited to, identifying if the eligible 
clinician or group scores high performance in patient access, care 
coordination and patient engagement, or health information exchange; as 
further specified in section II.E.5.g. of this proposed rule. To 
reiterate, any advancing care information objectives or measures must 
meet the public reporting standards to be posted on Physician Compare, 
either on the profile pages or in the downloadable database. This 
includes all available objectives or measures reported via all 
available submission methods, and applies to both MIPS eligible 
clinicians and groups. Statistical testing and consumer testing will 
determine how and where objectives and measures are reported on 
Physician Compare. In addition, we do not publicly report first year 
measures, meaning new measures that have been in use for reporting for 
less than 1 year, regardless of submission methods. After a measure's 
first year in use, we will evaluate the measure to see if and when the 
measure is suitable for pubic reporting (80 FR 71118). We request 
comment on these proposals.
    We also are seeking comment on potentially including an indicator 
to show low performance in the advancing care information performance 
category, as well as, the types of data that should be reported on 
Physician Compare as the MIPS program evolves, specifically in regard 
to the advancing care information performance category. Additionally, 
we would need to perform consumer testing and evaluate the feasibility 
of potentially including an indicator to show low performance in the 
advancing care information performance category to ensure this is 
understood by consumers. Any regulatory changes would be made in 
separate notice-and-comment rulemaking.
f. Utilization Data
    As discussed above, we previously finalized to begin to include 
utilization data in the Physician Compare downloadable database in late 
2016 using the most currently available data (80 FR 71130) to meet 
section 104(e) of the MACRA. As there are thousands of Healthcare 
Common Procedure Coding System (HCPCS) codes in use, not all available 
data will be included. The specific HCPCS codes included will be 
determined based on analysis of the available data, focusing on the 
most used codes. The goal will be to include counts that can facilitate 
a greater understanding and more in-depth analysis of the other measure 
and performance data being made available. We propose to continue to 
include utilization data in the Physician Compare downloadable 
database. We request comment on this.
g. APM Data
    As discussed above, section 1848(q)(9)(A)(ii) of the Act requires 
us to publicly report names of eligible

[[Page 28293]]

clinicians in Advanced APMs and, to the extent feasible, the names and 
performance of Advanced APMs. We see this as an opportunity to continue 
and build on reporting we are now doing of ACO data on Physician 
Compare. At this time, if an EP or group submitted quality data as part 
of an ACO, there is an indicator on the EP's or group's profile page 
indicating this. In this way, it is known which EPs and groups took 
part in an ACO. Also, currently, all ACOs have a dedicated page on the 
Web site to showcase their data. If technically feasible, we propose to 
use this model as a guide as we add APM data to Physician Compare. We 
propose to indicate on eligible clinician and group profile pages when 
the eligible clinician or group is participating in an APM. We also 
propose to link eligible clinicians and groups to their APMs data, as 
relevant and possible, through Physician Compare. Data posting would be 
considered for both Advanced and non-eligible APMs.
    At the outset, APMs will be very new concepts for consumers. 
Testing shows that at this time, ACOs are not a familiar concept to the 
average Medicare consumer. It is very easy for consumers to 
misunderstand an ACO as just a type of group. We expect at least the 
same lack of familiarity when introducing the broader concept of APM, 
of which ACOs comprise only one type. In these early years, indicating 
who participated in APMs and testing language to accurately explain 
that to consumers provides useful and valuable information as we 
continue to evolve Physician Compare. As we come to understand how to 
best explain this concept to consumers, we can continue to assess how 
to most fully integrate these data on the Web site. We request comment 
on these proposals.

F. Overview of Incentives for Participation in Advanced Alternative 
Payment Models

    Section 1833(z) of the Act, as added by section 101(e)(2) of the 
MACRA, requires that an incentive payment be made to Qualifying APM 
Participants (QPs) for participation in eligible alternative payment 
models (referred to as Advanced APMs). Key statutory elements of the 
incentives for participation in Advanced APMs under the Quality Payment 
Program addressed in this proposed rule include:
     Beginning in 2019, if an eligible clinician participates 
in a certain type of APM (an Advanced APM), they may become a QP. 
Eligible clinicians who are QPs are excluded from the MIPS.
     For years from 2019 through 2024, QPs receive a lump sum 
incentive payment equal to 5 percent of their prior year's payments for 
Part B covered professional services, and beginning in 2026, QPs 
receive a higher update under the PFS than non-QPs.
     For 2019 and 2020, eligible clinicians may become QPs only 
through participation in Advanced APMs.
     For 2021 and later, eligible clinicians may become QPs 
through a combination of participation in Advanced APMs and APMs with 
other payers (Other Payer Advanced APMs).
     This section of the rule proposes the definitions, 
requirements, procedures, and thresholds of participation that will 
govern this program.
1. Policy Principles
    Several core policy principles are derived from both the MACRA law 
and the Department's broad vision for better care, smarter spending, 
and healthier people. These principles drive many of our decisions in 
developing the overall framework for making APM Incentive Payments to 
QPs and for approaching interactions between MIPS and APMs found in 
this proposed rule. In addition to increasing the quality and 
efficiency of care delivered in the Medicare program and across the 
health system, these principles include the following seven goals:
     To the greatest extent possible, continue to build a 
portfolio of APMs that collectively allows participation for a broad 
range of physicians and other practitioners. We believe finding better 
ways to deliver care across settings and specialties can lead to 
improved health outcomes and more efficient health care spending. Doing 
this requires active CMS engagement with stakeholders, as well as input 
from those stakeholders to refine ideas in ways that meet statutory and 
delivery system reform goals.
     Design the program such that the APM Incentive Payment is 
attainable by increasing numbers of practitioners over time, yet 
remains reserved for those eligible clinicians participating in 
organizations that are truly engaged in care transformation. We believe 
the structure of the law is clear in that the APM Incentive Payments 
are earned through participation in APMs that are designed to be 
challenging and involve rigorous care improvement activities. In 
general, we believe eligible clinicians that receive incentives should 
be those who: Take on financial risk for potential losses under an APM; 
are accountable for performance based on meaningful quality metrics; 
and use certified EHR technology.
     Maximize participation in both Advanced APMs and other 
APMs. Although we want to maintain high standards for eligible 
clinicians to earn the APM Incentive Payment, we also want to enable 
and encourage high levels of participation in a broad range of APMs, 
including those that are not Advanced APMs. We believe participation in 
any APM offers eligible clinicians and beneficiaries significant 
benefits.
     Create policies that allow for flexibility in future 
innovative Advanced APMs. We do not want to constrain the robust 
development of new Advanced APMs by framing standards only in terms of 
today's APMs but rather in ways that allow many avenues for meeting the 
Advanced APM criteria.
     Support multi-payer models and participation in innovative 
models in Medicaid and commercial markets in order to promote high 
quality and efficient care across the health care market.
     Recognize that the APM Incentive Payment added by the 
MACRA primarily incentivizes participation in Advanced APMs that 
involve covered professional services under Medicare Part B. We believe 
the new provisions of section 1833(z) of the Act distinguish between 
participation in Advanced APMs that involve Medicare Part B covered 
professional services and participation in Other Payer Advanced APMs, 
which could include those sponsored by Medicare Advantage 
organizations. The Quality Payment Program has the potential to 
influence a wide range of payment arrangements, such as those under 
Medicare Advantage, but there is a clear distinction between Medicare 
Part B and all other payers in how calculations are performed for QP 
determinations and the APM Incentive Payment. Through the all-payer 
route to the APM Incentive Payment, we hope to encourage cooperation 
across payers and create demand for arrangements that, like Advanced 
APMs, meaningfully incorporate financial risk, quality measure 
performance, and use of certified EHR technology as strategies for 
improving care outcomes.
     Minimize burden on organizations and professionals. 
Between APM participation and MIPS reporting, we hope to coordinate 
administrative processes, minimize overall reporting burden, and make 
transitioning between being a QP and being subject to MIPS as seamless 
as possible.

[[Page 28294]]

     We do not intend to create additional performance 
assessments or audits beyond those specified under an APM. Rather, we 
believe the process for determining whether an eligible clinician 
receives the APM Incentive Payment should focus on the relative degree 
of participation by eligible clinicians in Advanced APMs, not on their 
performance within the APM. The Quality Payment Program does not alter 
how each particular APM measures and rewards success within its design. 
Rather, it rewards a substantial degree of participation in certain 
APMs.
2. Overview of Proposed APM Policies
    The incentives for Advanced APM participation established by MACRA 
includes several sets of related requirements that must be met. Three 
distinct roles play important parts in the program structure: (1) The 
Advanced Alternative Payment Model (Advanced APM), which is a health 
care payment and/or delivery model that includes payment arrangements 
and other design elements as part of a particular approach to care 
improvement; (2) the Advanced APM Entity, which is the entity 
participating in the Advanced APM and which meets criteria established 
under section 1833(z) of the Act; and (3) the eligible clinician, who 
is the individual physician or practitioner, or group of physicians or 
practitioners, who is a participant of the Advanced APM Entity and may 
be determined to be a QP.
    In this rule we are proposing a series of steps that result in the 
determination of certain eligible clinicians as QPs for a particular 
year (the payment year). QPs would receive the APM Incentive Payment as 
specified in section 1833(z) of the Act for each of the years they 
qualify from 2019 through 2024, and the differential update incentive 
in section 1848(d)(20) of the Act for each of the years they qualify 
beginning in 2026. Per section 1833(z)(1)(A) of the Act, the APM 
Incentive Payment that an eligible clinician receives as a QP for a 
year between 2019 and 2024 is a lump sum payment equal to 5 percent of 
the QP's estimated aggregate payments for Medicare Part B covered 
professional services (services paid under or based on the Medicare 
PFS) for the prior year. Eligible clinicians who are QPs for a year are 
also excluded from MIPS for that year. In addition, beginning in 2026, 
QPs receive a higher Medicare PFS update (the ``qualifying APM 
conversion factor'') than non-QPs. This QP determination is made for 
one calendar year at a time.
    The proposed steps that would result in a QP determination can be 
summarized as follows: (1) We determine whether the design of an APM 
meets three specified criteria for it to be deemed an Advanced APM; (2) 
an entity (the Advanced APM Entity) with a group of individual eligible 
clinicians participates in the Advanced APM; (3) we determine whether, 
during a performance period (the QP Performance Period), the eligible 
clinicians in the Advanced APM Entity collectively have at least a 
specified percentage of their aggregate Medicare Part B payments for 
covered professional services, or patients who received covered 
professional services, through the Advanced APM; (4) all of the 
eligible clinicians in the Advanced APM Entity are designated QPs for 
the payment year associated with that QP Performance Period. Those QPs 
would receive the 5 percent lump-sum APM Incentive Payments mentioned 
above for the payment year. This QP determination process would occur 
each year following the QP Performance Period, with the first payment 
year being 2019. In section II.F.5.a, we propose that the QP 
Performance Period will be the calendar year 2 years prior to the 
payment year.
    Under the MACRA, for payment years 2019 and 2020, QP determinations 
must be based only on payments or patients under Medicare Part B (the 
Medicare payment threshold option, which we refer to as the ``Medicare 
Option''). Beginning in payment year 2021--which according to our 
proposal would be based on 2019 calendar year data--there would be an 
additional option for eligible clinicians to become QPs through a 
combination of their participation in Advanced APMs and similar payment 
arrangements with other payers (Other Payer Advanced APMs). This option 
is the combination all-payer and Medicare payment threshold option, 
which we refer to as the ``All-Payer Combination Option.'' An eligible 
clinician need only meet the threshold for one of the options to be a 
QP for a year. Thus, an Advanced APM Entity may be able to compensate 
for a relatively low level of Advanced APM participation with 
participation in Other Payer Advanced APMs such as those with State 
Medicaid programs and commercial payers. Figure B illustrates the 
stages of determinations that result in QP determinations.

[[Page 28295]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.033

3. Terms and Definitions
    The proposed Quality Payment Program relies on a set of 
interrelated defined terms. The bases for some core terms are set forth 
at sections 1833(z)(3) and 1848(q)(1)(C)(iii) of the Act, and others we 
will propose to define in this proposed rule.
    We use the statutory text as a foundation to develop definitions 
for other key terms used in this proposed rule. The terms cover three 
primary topics: (1) The different types of APMs and their participating 
individuals and entities; (2) the timing, process and thresholds for 
determining QPs and partial qualifying APM participants (Partial QPs); 
and (3) the payment of the 5 percent lump sum incentive to QPs.
    As discussed in sections II.D and II.F.3 of this proposed rule, we 
are proposing definitions for the following APM-specific terms at Sec.  
414.1302 of new subpart O:
     Affiliated Practitioner.
     APM Entity.
     APM Incentive Payment.
     Attributed beneficiary.
     Attribution-eligible beneficiary.
     Alternative Payment Model (APM).
     Advanced Alternative Payment Model (Advanced APM).
     Advanced APM Entity.
     Episode payment model.
     Incentive Payment Base Period.
     Medicaid APM.
     Medicaid Medical Home Model.
     Medical Home Model.
     Other Payer APM.
     Other Payer Advanced APM.
     Partial Qualifying APM Participant (Partial QP).
     Partial QP Patient Count Threshold.
     Partial QP Payment Amount Threshold.
     Qualifying APM Participant (QP).
     QP Patient Count Threshold.
     QP Payment Amount Threshold.
     QP Performance Period.
     Threshold Score.
    To organize the terms, we have proposed the term ``Advanced APM'' 
for those APMs defined by section 1833(z)(3)(C) of the Act that meet 
the criteria under section 1833(z)(3)(D) of the Act. The MACRA uses the 
term ``Eligible APM'' in the heading for section 1833(z) of the Act, in 
section 1848(q)(9)(A)(ii) of the Act, and indirectly defines it at 
section 1833(z)(3)(D) of the Act as the APMs in which ``eligible 
alternative payment entities'' participate. We have decided to use the 
term ``Advanced'' in lieu of ``Eligible,'' and rather than referring 
indirectly, as is done in section 1833(z)(3)(D)(i) of the Act, to the 
APM in which an eligible alternative payment entity participates, we 
believe it is essential to the understanding of this proposed rule to 
be able to identify and propose requirements directly for an Advanced 
APM.
    Similarly, we propose to use the term ``Advanced APM Entity'' 
instead of ``alternative payment entity'' because it highlights the 
connected but different roles of the Advanced APM (for example, a CMS 
Innovation Center ACO model meeting specified criteria) and the 
Advanced APM Entity (for example, a specific ACO participating in that 
ACO model). We also believe that it is important to the clarity of this 
proposed rule to define ``APM Entity'' in addition to ``Advanced APM 
Entity'' so that we can easily distinguish between the two under both 
MIPS and the APM incentives. We propose that an APM Entity would be any 
participating entity in an APM, whereas we propose that an Advanced APM 
Entity would be one that participates in an APM that CMS has in fact 
determined to be an Advanced APM.

[[Page 28296]]

    We also propose to define the terms ``Medical Home Model'' and 
``Medicaid Medical Home Model'' as subsets of APMs and Other Payer 
APMs, respectively. The MACRA provides no definition for the term 
``medical homes'' but makes it an instrumental piece of the law under 
sections 1848(q)(5)(C)(i), 1833(z)(2)(B)(iii)(II)(cc)(BB), 
1833(z)(2)(C)(iii)(II)(cc)(BB), and 1833(z)(3)(D)(ii)(II) of the Act.
    We note that medical homes would be the APM Entities in an APM, not 
the APM itself. The requirements in the MACRA and in this proposed rule 
actually relate to the disposition of the APM, not the participating 
medical homes. For instance, as described in section II.F.4.b.(6) of 
this preamble, section 1115A(c) of the Act relates to the expansion of 
models (APMs), not the participants (APM Entities) of such models. APM 
participants are not expanded under section 1115A(c) of the Act. 
Therefore, we discuss medical homes in terms of the Medical Home Model, 
which is the concept to which the MACRA and this proposed rule actually 
refer. Although the definitions are identical but for their payer 
context, we distinguish Medicaid Medical Home Models because there are 
specific requirements for them under the determination of Other Payer 
Advanced APMs as described in section II.F.7.b.(3) of this preamble.
    We propose that a Medical Home Model must have the following 
elements at a minimum:
     Model participants include primary care practices or 
multispecialty practices that include primary care physician and 
practitioners and offer primary care services.
     Empanelment of each patient to a primary clinician.
    In addition to these elements, we propose that a Medical Home Model 
must have at least four of the following elements:
     Planned coordination of chronic and preventive care.
     Patient access and continuity of care.
     Risk-stratified care management.
     Coordination of care across the medical neighborhood.
     Patient and caregiver engagement.
     Shared decision-making.
     Payment arrangements in addition to, or substituting for, 
fee-for-service payments (for example, shared savings, population-based 
payments).
    The two required elements are consistent with the fundamental 
characteristics of medical homes in the various incarnations and 
accreditation standards across the health care market. Therefore, we 
believe that an APM cannot be a Medical Home Model unless it has a 
primary care focus with an explicit relationship between patients and 
their practitioners. To determine that an APM has a primary care focus, 
we propose that the Medical Home Model would have to have involve 
specific design elements related to Eligible clinicians practicing 
under one or more of the following Physician Specialty Codes: 01 
General Practice; 08 Family Medicine; 11 Internal Medicine; 37 
Pediatric Medicine; 38 Geriatric Medicine; 50 Nurse Practitioner; 89 
Clinical Nurse Specialist; and 97 Physician Assistant. We solicit 
comments on whether this proposal for determining that an APM has a 
primary care focus is sufficiently specified.
    We believe the optional elements should be present in Medical Home 
Models, but individually, each is less definitive of a characteristic 
than the two required elements. We also want to adhere to our principle 
of enabling future flexibility of APM design. Extensive rigid Medical 
Home Model criteria would not serve the purpose of promoting the 
development of new and potentially better ways of managing patient care 
through primary care.
    We seek comment on these elements and which of the elements should 
be required as opposed to optional. Our proposed definition of Medicaid 
Medical Home Model is identical to Medical Home Model, except that it 
specifically describes a payment arrangement operated by a State under 
title XIX. It is important to separate the terms because Medicaid 
Medical Home Models have distinct implications in the Other Payer 
Advanced APM determination and the QP determination under the All-Payer 
Combination Option.
    We believe that these proposed terms and definitions are sufficient 
to clearly implement the Quality Payment Program. For example, these 
terms cover all steps of the incentive payment process, from 
participation in Advanced APMs to QP determinations and payment of 
incentives. We are aware that this is a complex program and that we are 
proposing a significant number of terms. We believe that using more 
distinctive terms is preferable to using fewer terms that could overlap 
and convey different meanings in different contexts. For instance, 
Partial QP Patient Count Threshold is a highly specific term, but we 
believe that it is necessary in context because there are differences 
between QPs and Partial QPs, and there are differences between the 
payment amount and patient count thresholds used to determine whether 
an Eligible clinician becomes a QP or a Partial QP.
    We seek comment on these terms, including how we have defined the 
term, the relationship between terms, any additional terms that we 
should formally define to clarify the explanation and implementation of 
this program, and potential conflicts with other terms used by CMS in 
similar contexts. We also seek comment on the naming of the terms and 
whether there are ways to name or describe their relationships to one 
another that make the definitions more distinct and easier to 
understand. For instance, we would like to know if commenters believe 
there are more intuitive or efficient terms than those proposed that 
would still adhere to the statutory language and the intended purposes 
of the terms. In particular, we would consider options for a framework 
of definitions that might more intuitively distinguish between APMs and 
Other Payer APMs and between APMs and Advanced APMs.
    We also seek comment on alternative terms or definitions that are 
both useful in the calculations described in Sec.  414.1430, Sec.  
414.1435, Sec.  414.1440, and Sec.  414.1445 of the proposed rule and 
easily understood by stakeholders.
4. Advanced APMs
    The purpose of this section is to define and outline the proposed 
criteria for Advanced APMs, APMs through which eligible clinicians 
would have the opportunity to become QPs as specified in section 
1833(z)(3)(C) and (D) of the Act. Other Payer Advanced APMs, types of 
alternative payment arrangements related to the All-Payer Combination 
Option, are addressed below in section II.F.7 of this preamble.
    First, an Advanced APM must, by statute, meet certain requirements, 
and we propose details for these requirements within this section. 
First, the broad category of APMs is defined at section 1833(z)(3)(C) 
of the Act, which states that an APM is any of the following: (i) A 
model under section 1115A (other than a health care innovation award); 
(ii) the Shared Savings Program under section 1899; (iii) a 
demonstration under section 1866C; or (iv) a demonstration required by 
Federal law.
    We believe it necessary to propose additional clarification around 
the requirements as defined in section 1833(z)(3)(C)(iv) of the Act 
given the broad scope of programs and demonstrations required by 
federal legislation that are administered by the Department. We propose 
that in order to be an APM as a ``demonstration

[[Page 28297]]

required by Federal law,'' the demonstration must meet the following 3 
criteria: (1) The demonstration must be compulsory under the statute, 
not just a provision of statute that gives the agency authority, but 
one that requires the agency to undertake a demonstration; (2) there 
must be some ``demonstration'' thesis that is being evaluated; and (3) 
the demonstration must require that there are entities participating in 
the demonstration under an agreement with CMS or under a statute or 
regulation. We seek comment on our proposal for these criteria defining 
a demonstration required under Federal law.
    Second, to be considered an Advanced APM, an APM must meet all 
three of the following criteria, as required under section 
1833(z)(3)(D) of the Act. The criteria are:
     The APM must require participants to use certified EHR 
technology;
     The APM must provide for payment for covered professional 
services based on quality measures comparable to those in the quality 
performance category under MIPS;
     The APM must either require that participating APM 
Entities bear risk for monetary losses of a more than nominal amount 
under the APM, or be a Medical Home Model expanded under section 
1115A(c) of the Act. For a discussion of our proposals for Medical Home 
Models under this criterion, see section II.F.4.b.(6) of this preamble.
    We propose that an APM Entity is the participating entity in an APM 
that is primarily responsible for the cost and quality of care provided 
to beneficiaries under the terms of a direct agreement with CMS. The 
term ``eligible alternative payment entity'' (which we refer to as an 
``Advanced APM Entity'') is defined under section 1833(z)(3)(D) of the 
Act. An Advanced APM Entity is an APM Entity that participates in an 
Advanced APM that, through terms of a Participation Agreement with CMS 
or through Federal law or regulation, meets the criteria proposed in 
this rule. In section II.E.2 of this proposed rule, we propose that 
each unit--APM, APM Entity, and eligible clinician--would be clearly 
identified in CMS systems by a unique combination of APM identifier/APM 
Entity identifier/TIN/NPI to be considered for possible determination 
as an Advanced APM, Advanced APM Entity, or QP, respectively.
    In some cases, APMs offer multiple options or tracks with 
variations in the level of financial risk, or multiple tracks designed 
for different types of organizations, and we propose to assess the 
eligibility of each such track or option within the APM independently. 
For instance, the Medicare Shared Savings Program (Shared Savings 
Program) has three distinct tracks, the Comprehensive ESRD Care 
Initiative (CEC) consists of one track for large dialysis organizations 
and another track for non-large dialysis organizations, and the Next 
Generation ACO Model has two risk arrangement options that feature 
different levels of financial risk.
    Significant distinctions between the design of different tracks or 
options may mean that some tracks or options within an APM would meet 
the proposed Advanced APM criteria while other tracks or options would 
not. For example, APM Entities may have the option to assume two-sided 
risk (meaning that they bear a portion of the losses when spending 
exceeds expectations and share in the savings when spending is below 
expectations) or one-sided risk (meaning that they share in the savings 
when spending is below expectations, but do not bear a portion of the 
losses when spending exceeds expectations) under an APM. If the one-
sided risk track does not meet the standard for financial risk as 
discussed in section II.F.4.b.(3) of this preamble, APM Entities in 
this track would not be Advanced APM Entities, whereas those in the 
two-sided risk track could be Advanced APM Entities. In these 
instances, we propose that we would distinguish that the APM is only an 
Advanced APM for specific options or tracks.
    All entities participating in Advanced APMs are Advanced APM 
Entities, and distinguishing between the model and the participating 
entities allows us to directly identify and discuss the requirements 
unique to each. This approach to identifying Advanced APMs and Advanced 
APM Entities is also consistent with our proposal for determining QPs, 
described in section II.F.5 of this preamble, at the Advanced APM 
Entity level. We believe that because the Advanced APM Entity is the 
main participant in an Advanced APM, it should therefore be the 
operative unit by which QP determinations are made.
    We propose that an eligible clinician's QP status for a given 
payment year would be based on a collective evaluation of a group 
consisting of all eligible clinicians participating in an Advanced APM 
Entity. All eligible clinicians in an Advanced APM Entity would be 
identified as participants according to their APM participant 
identifiers in CMS systems as described in section II.E.2 of this 
preamble. To attain QP status, we propose that an eligible clinician 
would have to be listed on December 31 of the QP Performance Period as 
part of an Advanced APM Entity that, through the collective calculation 
of all its eligible clinicians, meets the QP Payment Amount Threshold 
or the QP Patient Count Threshold, both of which are described in 
section II.F.5 of this preamble. The form and collection of this list 
is part of the APM's design. For example, an ACO in the Shared Savings 
Program is comprised of a list of participating Medicare-enrolled TINs 
(ACO participants) that includes all eligible clinicians, as identified 
by their NPIs, who bill through those TINs. The group of eligible 
clinician TIN/NPI combinations determined as of December 31 at the end 
of each performance year, consistent with the proposals above, would be 
used to make a QP determination that would apply to all eligible 
clinicians on the list.
    Only eligible clinicians in Advanced APM Entities during the QP 
Performance Period would have the potential to become QPs and to 
qualify for the APM Incentive Payment. If the eligible clinicians in 
the Advanced APM Entity collectively meet the QP Payment Amount 
Threshold, QP Patient Count Threshold, Partial QP Payment Amount 
Threshold, or Partial QP Patient Count Threshold criteria as described 
in section II.F.5 of this preamble, we propose that all of those 
eligible clinicians in the group defined by the Advanced APM Entity 
would receive the QP status for the relevant payment year. For example, 
in the event that a track in the Shared Savings Program is determined 
to be an Advanced APM and the eligible clinicians in an ACO 
participating in that track (the Advanced APM Entity) collectively meet 
the QP threshold criteria, all of the eligible clinicians (as 
identified by their TIN/NPI combinations) in the ACO would become QPs.
    In sections II.F.5 and II.F.8 of the proposed rule, we propose that 
such QP status would apply to the individual eligible clinician's NPI 
across all of the TINs to which he or she reassigned the right to 
receive Medicare payment, not solely to the billing TIN affiliated with 
the Advanced APM Entity. We believe that this approach is consistent 
with the statute and prevents situations in which an eligible clinician 
may be excluded from MIPS for part of his or her practice but still 
subject to MIPS with respect to another part of his or her practice.
    Table 27 illustrates how hypothetical APM designs could intersect 
with proposed MACRA definitions.

[[Page 28298]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.034

a. Advanced APM Determination
    In order to determine Advanced APMs and achieve transparency for 
the Quality Payment Program, we propose to establish a process by which 
we identify and notify the public of the APMs (including specific APM 
tracks or options) that would be considered Advanced APMs for a QP 
Performance Period. We would post this notification to the CMS Web site 
prior to the beginning of the first QP Performance Period and update 
the information on a rolling basis according to the proposals below. We 
believe that making this information available in an accessible format 
is important for stakeholders to understand how CMS applies the 
Advanced APM criteria to existing APMs, and to be informed as early as 
possible about whether an APM they are considering joining is an 
Advanced APM. Similar to our stated principles earlier in this 
preamble, we believe that participation in APMs that are not Advanced 
APMs would continue to offer significant opportunities to eligible 
clinicians who are not immediately able or prepared to take on the 
additional risk and requirements of Advanced APMs.
    To determine Advanced APMs, we propose two phases of determination 
and notice. First, we propose to release an initial set of Advanced APM 
determinations no later than January 1, 2017, for APMs that will be 
operating during the first QP Performance Period. Second, for new APMs 
that are announced after January 1, 2017, CMS would include its 
Advanced APM determination in conjunction with the first public notice 
of the model, such as the Request for Applications (RFA) or proposed 
rule. We propose that determinations of Advanced APMs would be posted 
on the CMS Web site and updated on an ad hoc basis to the extent 
feasible, but no less frequently than annually, as new APMs become 
available and others end or change. Both the initial and ad hoc 
notifications would contain descriptions of whether each track or 
option within an APM would result in different Advanced APM statuses. 
We believe that this proposal incorporates both the interest in 
immediate dissemination of Advanced APM determinations for the existing 
APM portfolio following finalization of this rule and the structure for 
making the Advanced APM status a regular part of the development and 
release of new APMs in the future.
    We seek comment on the proposals for both the initial and ad hoc 
notices of Advanced APM determinations. In particular, we seek comments 
on optimal times, locations, formats, and other methods of notice of 
Advanced APM determinations to promote clarity and consistency around 
which APMs are considered Advanced APMs for a particular QP Performance 
Period.
    In addition to identifying Advanced APMs, we propose that we would 
identify Other Payer Advanced APMs. The Other Payer Advanced APM 
identification process would go into effect starting in the third QP 
Performance Period (applicable for payment year 2021) and would align 
with the availability of the All-Payer Combination Option for QP 
determinations. We propose that Other Payer Advanced APM determinations 
and associated notice would rely on information submitted by APM 
Entities and eligible clinicians as described in section II.F.7.d of 
this preamble and would operate in conjunction with the QP 
determination process under the All-Payer Combination Option as 
described in section II.F.7 of this preamble. If the information needed 
by CMS to make a determination for the Other Payer Advanced APM is not 
submitted in the manner and by the deadlines set by CMS through 
subregulatory guidance, we would not assess that Other Payer APM as 
explained under section II.F.7 of this preamble.
b. Advanced APM Criteria
    Under MACRA, for an APM to be an Advanced APM it must meet the 
criteria set forth in sections 1833(z)(3)(C) and (D) of the Act and 
discussed below. An Advanced APM must be an APM that:
     Requires its participants to use certified EHR technology 
(CEHRT), as described in section II.F.4.b.(1) of this preamble;
     Provides for payment for covered professional services 
based on quality measures comparable to measures under the quality 
performance category under MIPS, as described in II.F.4.b(2); and
     EITHER (a) requires its participating Advanced APM 
Entities to bear financial risk for monetary losses that are in excess 
of a nominal amount, as described in section II.F.4.b(3) of this 
preamble, or (b) is a Medical Home Model expanded under section 
1115A(c) of the Act, as described in section II.F.4.b(4) of this 
preamble.
    These requirements as set forth in the statute and proposed in this 
section must be met through the design of the APM. Whether an APM is an 
Advanced APM depends solely upon how the APM is designed, rather than 
on assessments of participant performance within the APM. Some 
stakeholders have suggested that actual performance (for example, on 
clinical quality measures or on whether the Advanced APM Entity 
generates savings) be

[[Page 28299]]

considered in the determination of QPs. However, the incentives for 
Advanced APM participation, as required under section 1833(z) of the 
Act, does not provide for consideration of actual performance in making 
such determinations. Performance assessments are already part of APMs, 
and we believe it is important and consistent with the statutory 
framework to continue to foster flexibility in structuring the specific 
rewards and consequences of performance within each APM.
    For example, an APM that ties payments to performance on quality 
measures comparable to those under MIPS may be an Advanced APM 
regardless of an Advanced APM Entity's actual performance on those 
quality measures. If an Advanced APM Entity fails to meet quality 
performance standards under the Advanced APM, it would face 
consequences within the Advanced APM, such as financial penalties, loss 
of access to data or certain waivers, or termination of its 
participation agreement. The termination scenario would have the 
downstream effect of terminating Advanced APM Entity status and the 
eligible clinicians' potential eligibility for the APM Incentive 
Payment because the entity would no longer be participating in the 
Advanced APM. As another example, an Advanced APM Entity that bears 
more than nominal financial risk for monetary losses in accordance with 
the standards set forth in section II.F.4.b.(3) of this preamble would 
be an Advanced APM Entity regardless of whether it actually earns 
shared savings or generates shared losses under the Advanced APM. This 
would work similarly for an Other Payer Advanced APM.
    We do not intend to add additional performance assessments on top 
of existing Advanced APM standards. As stated in the discussion of 
policy principles at the beginning of section II.F.1 of this preamble, 
the proposed QP determination process assesses the relative degree of 
participation of the Advanced APM Entity and eligible clinician in 
Advanced APMs, not their performance success as assessed under the APM. 
The Quality Payment Program would not alter how each particular APM 
measures and rewards success within its design. Rather, the Quality 
Payment Program rewards a substantial degree of participation in 
certain APMs.
(1) Use of Certified EHR Technology
    The first criterion an APM must meet to be considered an Advanced 
APM is that it requires participants in such model to use certified EHR 
technology (as defined in section 1848(o)(4) of the Act), as specified 
in section 1833(z)(3)(D)(i)(I) of the Act. Furthermore, to be 
considered an Other Payer Advanced APM, as described under sections 
1833(z)(2)(B)(iii)(II)(bb) and 1833(z)(2)(C)(iii)(II)(bb) of the Act, 
payments must be made under arrangements in which certified EHR 
technology is used. Although the statutory requirement is phrased 
slightly differently for Advanced APMs and Other Payer Advanced APMs, 
we believe that there is value in keeping the two standards as similar 
as possible. We received a number of comments on the MIPS and APMs RFI 
regarding the definition and use of CEHRT by APMs. A number of 
commenters recommended that CMS use the same CEHRT definition for APMs 
that is used for the MIPS program to reduce confusion among 
participants in these programs and to align the program requirements. 
Some commenters suggested we should not require additional CEHRT 
requirements for APMs, while others indicated that current health IT is 
not adequate to support practice transformation efforts to perform as a 
patient centered medical home. Other commenters indicated the focus 
should not be on the technology used, but rather the design and purpose 
of the APM. A few commenters indicated there was a need to develop 
certified health IT for specialty eligible clinicians. Additionally, 
psychologists, plastic surgeons, radiologists, and other specialists 
commented that they did not want to be left out of APMs because they 
did not have certified health IT meeting the CEHRT definition now or 
may not use CEHRT for the same functions as other eligible clinicians.
    After consideration of these comments, we propose to adopt for 
Advanced APMs and Other Payer Advanced APMs, the definition of CEHRT 
that is proposed for MIPS and the APM incentive under Sec.  414.1305. 
In the 2015 EHR Incentive Programs final rule (80 FR 62872 through 
62873), we established the definition of CEHRT for EHR technology that 
must be used by Eligible Professionals to meet the meaningful use 
objectives and measures in specific years. In this proposed rule, we 
are proposing to adopt the specifications from within the current 
definition of CEHRT in this regulation at Sec.  414.1305 for eligible 
clinicians participating in MIPS or in APMs. This definition is similar 
to the definition that applies to eligible hospitals, CAHs, and 
eligible professionals (EPs) in the EHR Incentive Programs. The 
definition includes the certification criteria for a wide range of 
standards for use in capturing patient health information like vital 
signs, medications and medication allergies, problem list, and lab 
results among other data elements including the common clinical data 
set (CCDS). It also includes the certification criteria and standards 
for functions related to information exchange, patient engagement, 
quality reporting, and protecting the privacy of electronic protected 
health information. For further information on the certification 
criteria see the 2015 Edition Certification Criteria final rule (80 FR 
62602 through 62759) and for example Table 8: ``Common Clinical Data 
Set'' (80 FR 62696).
    This approach aligns the APM health IT certification requirements 
for Advanced APMs with those used by MIPS eligible clinicians. We 
understand this proposed CEHRT definition may include some EHR 
functionality used by MIPS eligible clinicians which may be less 
relevant for an APM participant, and likewise APM participants may use 
additional functions that are not required for MIPS participation. 
However, we observe that APM participants often work in the same office 
space, group, entity, or organization with eligible clinicians that are 
not APM participants. At times they might share common resources, such 
as the same EHR system. Using the same CEHRT definition for both MIPS 
and Advanced APMs would allow Eligible clinicians to continue to use 
shared EHR systems and give eligible clinicians flexibility of 
participation as a MIPS eligible clinician or an eligible clinician in 
an Advanced APM without needing to change or upgrade EHR systems. 
Although updates to the certified health IT for APM participants, MIPS 
participants, or both may be necessary in future years, we believe that 
aligning the APM and MIPS definition for CEHRT is appropriate at this 
time.
    We seek comment on the proposed definition of CEHRT for Advanced 
APMs and Other Payer Advanced APMs and whether the definition should be 
the same for both.
    The statute does not specify the number of eligible clinicians who 
must use CEHRT or how CEHRT must be used in an Advanced APM. We believe 
CMS has discretion to define the ways in which an Advanced APM uses 
CEHRT. In accordance with section 1833(z)(3)(D)(i)(I) of the Act, we 
propose that an Advanced APM must require at least 50 percent of 
eligible clinicians who are enrolled in Medicare (or each hospital if 
hospitals are the APM participants) to use the certified health IT 
functions outlined in the proposed

[[Page 28300]]

definition of CEHRT to document and communicate clinical care with 
patients and other health care professionals. Communicating clinical 
care means that other eligible clinicians and/or the patient can view 
the clinical care information. Later in this section, we also propose 
an alternative set of criteria applicable to the Shared Savings Program 
to demonstrate the use of CEHRT by their eligible clinicians in order 
to be an Advanced APM. We propose the 50 percent threshold be confined 
to the first QP Performance Period (proposed later in this rule to be 
2017). That is, only in 2017 could APMs use the 50 percent threshold 
for eligible clinicians in each participating entity to meet the use of 
CEHRT requirement. We propose that the threshold requirement for use of 
CEHRT would increase to 75 percent beginning for the second QP 
Performance Period (proposed to be 2018). The requirement for hospitals 
participating in Advanced APMs would remain the same over time because 
it is an all-or-nothing requirement of the hospital as a single entity.
    We believe there are a few reasons why having a lower threshold 
requirement for the use of CEHRT by the eligible clinicians 
participating in an APM Entity in the first year is appropriate. First, 
we want to ensure that APMs have sufficient time to alter their terms 
and conditions to meet this standard. We also acknowledge that eligible 
clinicians will be expected to upgrade from technology certified to the 
2014 Edition to technology certified to the 2015 Edition for use in 
2018, and some eligible clinicians who have not yet adopted CEHRT may 
wish to delay acquiring CEHRT products until a 2015 Edition certified 
product is available.
    Although these are important considerations for the first year of 
the program, we believe that APMs should expect their APM Entities to 
meet a higher standard for the use of certified EHR technology in 
future years. We note that several APMs that are likely to meet the 
other criteria to be an Advanced APM have already demonstrated higher 
rates of achievement of meaningful use under the EHR Incentive Program 
that exceed the requirements under the APM. For instance, an analysis 
of 2014 performance year quality reporting data under the SSP showed 
that an average of 86 percent of primary care physicians met meaningful 
use requirements in 2014 (See https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-08-25.html). Other APMs require all eligible clinicians to use CEHRT as a 
requirement for participation in the APM. We believe that, based on the 
focus of an Advanced APM, this criterion should challenge APMs and 
their participants to adopt CEHRT at high rates and use its 
capabilities to deliver high value care. The adoption of CEHRT is 
critical to supporting increased care coordination, electronic clinical 
quality measure reporting, electronic clinical decision support, and 
many other capabilities supportive of success in APMs, and we believe 
these capabilities should be widely available to eligible clinicians 
participating in APMs. Therefore, we believe that raising the threshold 
for use of CEHRT required to be an Advanced APM would be appropriate 
for future years beginning in QP Performance Period 2018.
    Stakeholders should keep in mind that this CEHRT requirement would 
be based on the requirements that an APM places on its participating 
APM Entities. In determining whether an APM meets this criterion, CMS 
does not propose to assess the level of use of each APM Entity or 
individual eligible clinician participating in the APM but rather 
whether the APM requirements meet the standard set forth in this 
proposed rule.
    We invite comment on whether the proposed thresholds for use of 
CEHRT for APM Entities that are not hospitals (50 percent for the first 
QP Performance Period (proposed 2017) and 75 percent for the second QP 
Performance Period (proposed 2018) and later are appropriate, or if we 
should consider additional options such as a higher or lower percentage 
in 2018, or an additional incremental increase for 2019. We also invite 
comment on whether we should consider higher thresholds for APMs that 
target eligible clinician populations with higher-than-average adoption 
of certified health IT, such as eligible clinicians in patient-centered 
medical homes. Finally, we invite comment on whether we should explore 
ways to set lower thresholds for those APMs targeting eligible 
clinician populations that may have lower average adoption of certified 
health IT, such as specialty-focused APMs.
    We also propose an alternative criterion for determining whether an 
APM meets the CEHRT requirement, exclusively applicable for the Shared 
Savings Program. We believe this method is appropriate for the Shared 
Savings Program because although the Shared Savings Program requires 
ACOs to encourage and promote the use of enabling technologies (such as 
EHRs) to coordinate care for assigned beneficiaries, the Shared Savings 
Program does not require a specific level of CEHRT use for 
participation in the program. Instead, the Shared Savings Program 
includes an assessment of EHR use as part of the quality performance 
standard which directly impacts the amount of shared savings/losses 
generated by the Shared Savings Program ACO. We believe it is important 
to incentivize ever-increasing level of CEHRT use. However, in contrast 
to CMS APMs under section 1115A of the Act, CMS would have to undertake 
significant rulemaking to adopt an eligibility standard for the Shared 
Savings Program that is consistent with the proposed criterion for 
other CMS APMs. Following such rulemaking, we would have to collect 
additional information from each existing and applying ACO outside the 
routine application process in the weeks prior to the start of the 2017 
performance year which we believe could introduce uncertainty and 
burden for CMS, ACOs, and participating EPs. Moreover, we believe that 
the proposed alternative criterion builds on established Shared Savings 
Program rules and incentives that directly tie the level of CEHRT use 
to the ACO's financial reward which in turn has the effect of directly 
incentivizing ever-increasing levels of CEHRT use among EPs. We believe 
that the proposed alternative criterion for the Shared Savings Program 
is consistent with the goals of the APM incentive and reduces burden 
and uncertainty for the Shared Savings Program participants. Therefore, 
because most other APMs can accommodate a new CEHRT use requirement for 
eligible clinicians without modifying our regulations, we are 
restricting this method to the Shared Savings Program. We propose that 
this alternative would allow the Shared Savings Program to meet the 
criterion if it holds APM Entities accountable for their eligible 
clinicians' use of CEHRT by applying a financial penalty or reward 
based on the degree of CEHRT use (such as the percentage of eligible 
clinicians that use CEHRT or the engagement in care coordination or 
other activities using CEHRT). One of the quality measures used in the 
Shared Savings Program's quality performance standard assesses the 
degree to which certain eligible clinicians in the ACO successfully 
meet the requirements of the EHR Incentive program, which requires the 
use of CEHRT by certain eligible clinicians in the ACO. Successful 
reporting of the measure for a performance year gives the ACO points 
toward its overall quality score, which in turn affects the amount of 
shared savings or shared losses an ACO could earn or be liable for, 
respectively. Because of this, ACOs in the Shared Savings Program 
actively promote and

[[Page 28301]]

seek to improve upon the EHR measures annually, leading to greater use 
of CEHRT among eligible clinicians participating in Shared Savings 
Program ACOs. We believe our proposed criteria for APMs, generally, and 
our alternative for the Share Savings Program, would meet the statutory 
requirement of section 1833(z)(3)(D)(i)(I) of the Act, as both hinge 
upon the Advanced APM requiring its participants use CEHRT with 
consequences for failure to meet the APM's standards. We solicit 
comment on our proposed methods for meeting the criterion for an 
Advanced APM to require its participants to use CEHRT as specified in 
section 1833(z)(3)(D)(i)(I) of the Act.
    In addition to these proposals, we are interested in what other 
health IT functionalities APM participants might need to effectively 
provide care to their patients and how the use of interoperable health 
IT can strengthen and encourage higher quality patient care and more 
effective care coordination across all APMs. Recent research and input 
from experts, practitioners, and the public (See https://www.healthit.gov/facas/sites/faca/files/HITPC_AHMWG_Meeting_Slides_Final_Version_9_2015-11-10.pdf) has 
identified priority health IT capabilities that will be important for 
participants in APMs but are not yet widely available in current health 
IT systems, such as the ability to manage and track status of referrals 
and create and maintain electronic shared care plans for team-based 
care management.
    We look forward to receiving comments as to whether new health IT 
standards and certification criteria may be needed to ensure that 
participants in APMs have access to interoperable health IT products 
and services necessary for effective care coordination, population 
health management, and patient engagement. We will work with the Office 
of the National Coordinator (ONC) to explore opportunities for 
certified health IT capabilities reflected in the CEHRT definition to 
evolve in ways that meet the needs of participants in APMs while 
supporting eligible clinicians in MIPS to fulfill the EHR performance 
category under MIPS.
    We believe that all patients, families, and healthcare 
professionals should have consistent and timely access to health 
information in a standardized format that can be securely exchanged 
between these parties (See HHS August 2013 Statement, ``Principles and 
Strategies for Accelerating Health Information Exchange''). The secure, 
appropriate exchange of health information can help health care 
professionals improve quality of care through more robust care 
coordination, and improve the efficiency of care through access to 
patient information across settings. Interoperability is a key priority 
for the healthcare industry. HHS recently received pledges from 
companies that provide 90 percent of the electronic health records used 
by hospitals nationwide, as well as the top five largest health care 
systems in the country, to: help consumers easily and securely access 
their electronic health information; help clinicians share individuals' 
health information for care with other clinicians and their patients 
whenever permitted by law and not block electronic health information; 
and implement federally recognized, national interoperability 
standards, policies, guidance, and practices for electronic health 
information.
    A growing number of organizations across the country are now 
focused on facilitating health information exchanges (HIEs) among 
healthcare professionals at the national, state, and community levels. 
According to one figure, there were 267 organizations providing HIE 
services operating in the U.S. in 2014 (see https://ehi-rails-app.s3.amazonaws.com/uploads/article/file/476/2014_eHI_Data_Exchange_Survey_Results_Webinar_Slides.pdf), including 
community-based organizations, statewide efforts, and other healthcare 
delivery entities supporting exchange. While representing a wide 
variety of stakeholders, services and structures, these organizations 
play an important role in facilitating care coordination and data 
sharing for many health care professionals across the country. We 
encourage the growth of these services and encourage healthcare 
professionals to explore partnering with organizations offering HIE 
services.
    We seek comment on how requirements for the use of CEHRT within 
APMs could evolve to support expanded participation in organizations 
supporting HIEs. For instance, should CMS consider expanding in future 
rulemaking the CEHRT criterion for Advanced APMs to include recognition 
of participation with an organization providing HIE services? Would 
this option be likely to spur further interest among entities in 
partnering with organizations that provide HIE services? Should these 
organizations be required to adhere to specific standards that promote 
interoperability across health information systems? How could a 
potential future governance mechanism for HIE (that is, establishing a 
common set of standards, services, policies, and practices) be 
incorporated into requirements for APMs? We seek comment on these and 
any other issues related to advancing participation in HIEs though the 
use of CEHRT in APMs.
(2) Comparable Quality Measures
    The second criterion for a APM to be an Advanced APM is that it 
provides for payment for covered professional services based on quality 
measures comparable to measures under the performance category 
described in section 1848(q)(2)(B)(i) of the Act, which is the MIPS 
quality performance category. We interpret this criterion to require 
the APM to incorporate quality measure results as a factor when 
determining payment to participants under the terms of the APM.
    Our proposed policy for this criterion is informed by our proposed 
policy for the MIPS quality performance category. For more information 
on quality measures under the MIPS quality performance category, please 
see section II.E.3.b of this preamble of this preamble, in which CMS 
proposes eligible clinicians will select quality measures from the MIPS 
measures list in section II.E.3 of this preamble for the first 
performance year of MIPS. We will publish a list of quality measures 
annually, through notice and comment rulemaking, from which MIPS 
eligible clinicians may choose measures for assessment under the MIPS 
quality performance category. The measures included in the annual list 
of MIPS measures must adhere to specific criteria that include the 
following: (1) Measures must have an evidence-based focus if the 
measures are not endorsed by a consensus-based entity as described in 
section 1848(q)(2)(D)(v) of the Act; and (2) new measures and the 
method for developing and selecting such measures, including clinical 
and other data supporting such measures, must be submitted to a 
specialty-appropriate, peer-reviewed journal prior to inclusion of the 
measure in MIPS as described in section 1848(q)(2)(D)(iv) of the Act.
    The statute also establishes priorities for both the quality 
domains of measures to be developed and the types of measures to be 
prioritized in the measure development plan, which are located, 
respectively at sections 1848(s)(1)(B) and (D) of the Act. The priority 
measure types include outcome, patient experience, care coordination, 
and measures of appropriate use of services such as measures of 
overuse.
    We are considering a number of ways to implement the Advanced APM 
requirement to base payment on measures comparable to those in MIPS, as 
well as how to define which measures would reflect the statutory

[[Page 28302]]

requirement to be ``comparable'' to MIPS quality measures. Some of the 
options we explored for defining measures comparable to those in MIPS 
included: (1) Limiting comparable measures to those from the annual 
MIPS list of measures; and (2) including quality measures from the 
annual MIPS list of measures and/or measures that have an evidence-
based focus and are found to be reliable and valid through measure 
testing. We also explored whether we should require a minimum number of 
measures for all Advanced APMs, and whether the number of measures 
would need to be the same as those required under the MIPS quality 
performance category.
    In exploring these options we decided that while they all have 
merit, we are concerned they may be overly restrictive for the variety 
of APMs, many of which are designed to have the flexibility to test new 
ways of paying for and delivering care. We want to ensure that APMs 
have the latitude to base payment on quality measures that meet the 
goals of the model and assess the quality of care provided to the 
population of patients that the APM participants are serving. It is 
important to note that many APMs include some common measures that are 
proposed for inclusion in MIPS. For example, many of the quality 
measures used in the Shared Savings Program and the Next Generation ACO 
Model that are submitted to CMS through the CMS web interface, are also 
proposed for inclusion in MIPS.
    However, APMs that focus on patients with specific clinical 
conditions, such as end-stage renal disease or patients undergoing 
specific surgical procedures, would have valid reasons for including 
different quality measures than those that target more general 
populations. Similarly, some models may focus on specialist eligible 
clinicians for whom there may be only a small number of valid and 
relevant quality measures. Lastly, we cannot predict the specific care 
goals and payment designs of future physician-focused payment models 
and other APMs. Consequently, we do not want to impose measure 
requirements that may prevent CMS from including quality measures that 
may be better suited to the specific aims of new innovative APMs.
    We received a number of comments on the MIPS and APMs RFI on the 
use of MIPS-comparable quality measures by an Advanced APM. A commenter 
suggested CMS include high-value performance measures to assess and 
improve the quality of care that are clinically important, evidence-
based, transparent, feasible, valid and reliable, actionable, and 
rigorously audited to ensure accuracy. Other commenters indicated APMs 
should not be required to have the same reporting requirements as is 
required under the quality reporting performance category for MIPS 
because each APM is designed differently and may be developed with a 
specific specialty or condition in mind, so broad reporting 
requirements would not be relevant. Commenters also indicated the need 
for measures that could be used across APMs and MIPs to reduce the 
eligible clinician's reporting burden when switching from one program 
to the other.
    After consideration of the comments and the options above, we 
recognize the need to propose a measure framework for comparable 
measures that reflects a few key principles. For the Advanced APM 
measures to be comparable to MIPS measures, the measures should have an 
evidence-based focus and as appropriate, target the same priorities, 
(for example, clinical outcomes, use and overuse). However, as each APM 
Entity is different, there needs to be the flexibility to determine 
which measures are most appropriate for use in their respective APM for 
the purpose of linking those measures to payment under the model. We 
agree that measures that could be used in both MIPS and APMs is 
beneficial to eligible clinicians who may switch from one program to 
the other, but we also do not want to restrict APMs from including new 
innovative measures that may not be included in MIPS initially, or 
until later years of the program.
    We also note that under the MACRA and in this proposal, not all 
quality measures under which an APM is assessed are required to be 
``comparable'' and not all payments under the APM must be based on 
comparable measures. However, at least some payments must be tied to 
measures comparable to MIPS, regardless of whether those comparable 
measures are the only ones the APM uses. Under this proposal, APMs 
retain sufficient freedom to innovate in paying for services and 
measuring quality. For instance, an APM may have incentive payments 
related to quality, total cost of care, participation in learning 
activities, and adoption of health IT. The existence of all of the 
payments associated with non-quality aspects does not preclude the APM 
from meeting this Advanced APM criterion. In other words, this 
criterion only sets standards for payments tied to quality measurement, 
not other methods of payment. Conversely, an APM may, as current models 
at the CMS Innovation Center currently do, test new quality measures 
that do not fall into the MIPS-comparable standard. So long as the APM 
meets the requirements set forth in this criterion, there is no 
additional prescription for how the APM tests additional measures that 
may or may not meet the standards under this criterion. Therefore, we 
propose that the quality measures on which the Advanced APM bases 
payment must include at least one of the following types of measures 
provided that they have an evidence-based focus and are reliable and 
valid:
    (1) Any of the quality measures included on the proposed annual 
list of MIPS quality measures;
    (2) Quality measures that are endorsed by a consensus-based entity;
    (3) Quality measures developed under section 1848(s) of the Act;
    (4) Quality measures submitted in response to the MIPS Call for 
Quality Measures under section 1848(q)(2)(D)(ii) of the Act; or
    (5) Any other quality measures that CMS determines to have an 
evidence-based focus and be reliable and valid.
    We believe that quality measures that are endorsed by the National 
Quality Forum would meet these criteria. We also propose to establish 
an Innovation Center quality measure review process for those measures 
that are not NQF-endorsed or included on the final MIPS measure list to 
assess if the quality measures have an evidence-based focus, and are 
reliable and valid. For example, the Comprehensive ESRD Care Model 
includes NQF #0226 Influenza Immunization for the ESRD Population which 
is not a measure included for reporting in MIPS but meets the proposed 
criteria for MIPS-comparable quality measures. We believe under the 
proposed categories above MIPS-comparable quality measures may include 
measures that are fully developed after being tested in an APM and 
found to be reliable and valid. Similarly, we believe that MIPS-
comparable quality measures may include QCDR measures provided that the 
QCDR measures used by the Advanced APM for payment have an evidence-
based focus and are reliable and valid.
    The statute identifies outcome measures as a priority measure type 
and we want to encourage the use of outcome measures for quality 
performance assessment in APMs. Therefore, we propose that in addition 
to the general comparable quality measure requirements proposed in this 
section, an Advanced APM must include at least one outcome measure if 
an appropriate measure (that is, the measure addresses the specific 
patient

[[Page 28303]]

population and is specified for the APM participant setting) is 
available on the MIPS list of measures for that specific QP Performance 
Period, determined at the time when the APM is first established. If 
there is no such measure available on the MIPS list at the time the APM 
is established, then CMS would not require an outcome measure be 
included after APM implementation.
    We believe that this framework would provide the flexibility needed 
to ensure APM quality performance metrics meet the APM's goals. We 
invite comments on whether measures to be considered comparable to MIPS 
should all be reliable and valid and have an evidenced-based focus.
(3) Financial Risk for Monetary Losses
(a) Overview
    The third criterion that a APM must meet to be an Advanced APM is 
that it must either be a Medical Home Model expanded under section 
1115A(c) of the Act as described below, or the APM Entities under the 
APM must bear financial risk for monetary losses under such APM that 
are in excess of a nominal amount. We will refer to the latter 
criterion as the ``financial risk criterion.'' The proposed correlating 
financial risk criterion for Other Payer Advanced APMs is described in 
section II.F.7 of this preamble with the requirements for consideration 
under the All-Payer Combination Option that is applicable in payment 
years 2021 and later.
    The proposed financial risk criterion for Advanced APMs would apply 
to the design of the APM financial risk arrangement between CMS and the 
participating APM Entity. If the structure of the arrangement meets the 
proposed financial risk requirements, then this criterion would be met. 
This proposal would not impose any additional performance criteria 
related to bearing financial risk. For example, eligible clinicians 
under the Advanced APM Entity would not need to bear financial risk 
under the APM so long as the APM Entity bears that risk. Furthermore, 
an APM Entity would not need to actually achieve savings or other 
metrics for success under the APM in order for the APM to meet this 
criterion.
    This discussion is broken into two main topics: (1) What it means 
for an APM Entity to bear financial risk for monetary losses under a 
APM; and (2) what levels of risk CMS would consider to be in excess of 
a nominal amount. In developing our proposed policies we prioritized 
keeping these standards consistent across different types of APMs, 
including Other Payer Advanced APMs as described in section 
II.F.7.b.(6) of this preamble. We believe that keeping these standards 
consistent to the extent possible would make it easier for 
stakeholders, APM Entities, and eligible clinicians to understand the 
type of financial risk required in order for an APM to be an Advanced 
APM. However, we do propose to specify small variations in the 
requirements in order to accord with the differing characteristics of 
certain types of APMs.
    In particular, we propose specific standards that would apply for 
Medical Home Models. We believe that, given the unique financial risk 
and nominal amount standards we are proposing for Medical Home Models 
in this section below, it would be appropriate to impose size and 
composition limits for the Medical Home Models to which the unique 
standards would apply in order to ensure that the focus is on 
organizations with a limited capacity for bearing the same magnitude of 
financial risk as larger APM Entities do. We propose that beginning in 
the second QP Performance Period (proposed to be 2018), the Medical 
Home Model financial risk standard and nominal amount standard, 
described in section II.F.4.b.(4) of this preamble, would only apply to 
APM Entities that participate in Medical Home Models and that have 50 
or fewer eligible clinicians in the organization through which the APM 
Entity is owned and operated. Thus, in a Medical Home Model that is an 
Advanced APM, the proposed Medical Home Model financial risk and 
nominal amount standards would only apply to those APM Entities owned 
and operated by organizations with 50 or fewer eligible clinicians. We 
believe it is appropriate to use eligible clinicians, rather than 
physicians, when setting this threshold as the number of eligible 
clinicians both reflects organizational resources and capacity and also 
may fluctuate widely around a specific number of physicians. We also 
believe that this size threshold of 50 eligible clinicians is 
appropriate because organizations of that size have demonstrated the 
capacity and interest in taking on higher levels of two-sided risk 
either by themselves or by joining with other organizations. In the 
event that a Medical Home Model happens to meet the generally 
applicable financial risk and nominal amount standards, this 
organizational size limitation would be moot.
    Measuring organizational size based on the size of the ``parent 
organization'' differs from measuring it based on the size of the APM 
Entity. Collecting accurate information on the number of eligible 
clinicians affiliated with a parent organization will require 
additional, but we believe achievable, reporting by APM Entities. We 
believe that size of the organization is generally a better indication 
of risk-bearing capacity than APM Entity size. For instance, an APM 
Entity may be very small if it represents one practice site, but that 
practice site may be one of many affiliated with a health system or 
independent physician association of substantial size. We believe that 
the proposed limits on the types and sizes of entities that can be 
Advanced APM Entities under Medical Home Models will encourage larger 
organizations to move into Advanced APMs with greater levels of risk 
than the smaller levels that could enable Medical Home Models to become 
Advanced APMs. This is consistent with our goals that the incentives 
for Advanced APM participation should reward commitment to challenging 
models. However, we do not intend to imply that participation in 
Medical Home Models is necessarily inappropriate for larger 
organizations. We recognize that Medical Home Models differ from other 
APMs, such as ACO initiatives, because Medical Home Models focus on 
improving primary care through much more targeted and intensive 
interventions than those commonly found in other APMs. We hope to 
encourage participation in Medical Home Models for all organizations 
that can derive value from their designs, not just those that are too 
small to join ACO initiatives and other higher risk APMs.
    We propose implementing this size limitation for Advanced APMs that 
are Medical Home Models beginning in the second year of the Quality 
Payment Program (proposed QP Performance Period 2018) because we 
understand that applications for many APMs will be due to CMS before 
this rule will be finalized, precluding APM Entities from having time 
to substantially adjust their APM participation strategies for the 2017 
QP Performance Period. We propose that CMS would make a determination 
of whether an APM Entity meets the size limitation prospectively before 
a QP Performance Period, and that the determinations would not 
subsequently change based on changes in organizational size during or 
after the QP Performance Period (although changes in organizational 
size would, as applicable, affect determinations for subsequent QP 
Performance Periods). We want all organizations to have the greatest 
amount of knowledge possible about their APM participation options 
prior to

[[Page 28304]]

making the important decision of which APM or APMs to pursue.
    We seek comment on this proposal, particularly with regard to the 
use of the count of eligible clinicians in the parent organization of 
the APM Entity as the metric of organizational size for Medical Home 
Models, and whether setting the limit at 50 for the number of eligible 
clinicians in the organization would constitute a reasonable threshold 
to distinguish between organizations that we could expect to have the 
financial capability to join APMs, such as ACO initiatives, that have 
two-sided risk. We also seek comment on an alternative option to 
establish the size limitation based on the number of eligible 
clinicians in the Medical Home Model, rather than on number of eligible 
clinicians in the APM Entity's organization. Under this alternative 
option, we would modify the Medical Home Model definition so that an 
APM could only be considered a Medical Home Model if no more than 10 
percent of eligible clinicians (or, alternatively, 10 percent of APM 
Entities) in the APM are part of parent organizations with more than 50 
eligible clinicians. If this element of the Medical Home Model 
definition were met (along with all other Medical Home Model elements), 
all APM Entities participating in the APM would be considered medical 
homes regardless of their size. Conversely, if more than 10 percent of 
eligible clinicians (or alternatively, 10 percent APM Entities) 
participating in the APM are part of parent organizations with more 
than 50 eligible clinicians, the entire APM would not be a Medical Home 
Model, and, in the event that the APM does not meet the generally 
applicable Advanced APM financial risk criterion, none of the 
participating APM Entities would be Advanced APM Entities.
(b) Bearing Financial Risk for Monetary Losses
    In this section, we propose a generally applicable financial risk 
standard for Advanced APMs and a unique standard that would apply only 
for Advanced APMs that are identified as Medical Home Models.
(i) Generally Applicable Advanced APM Standard
    First, we propose that the generally applicable financial risk 
standard for Advanced APMs would be that an APM must include provisions 
that, if actual expenditures for which the APM Entity is responsible 
under the APM exceed expected expenditures during a specified 
performance period, CMS can:
     Withhold payment for services to the APM Entity and/or the 
APM Entity's eligible clinicians;
     Reduce payment rates to the APM Entity and/or the APM 
Entity's eligible clinicians; or
     Require the APM Entity to owe payment(s) to CMS.
    The proposed financial risk standard for Advanced APMs reflects our 
interpretation of the statutory requirement that Advanced APM Entities 
must bear financial risk for monetary losses to encompass ``losses'' 
that could be incurred through either direct repayments to CMS or 
reductions in payments for services. The former would cover two-sided 
risk arrangements such as shared savings initiatives in which an 
Advanced APM Entity may receive shared savings or be liable for shared 
losses. The latter would cover a range of alternative methods for 
linking performance to payment, such as payment withholds subject to 
successful performance, or discounts in payment rates retrospectively 
applied at reconciliation similar to those in many episode-based 
bundled payment models. We note that the proposed generally applicable 
financial risk standard would not include reductions in bonus 
payments--such as shared savings payment incentives that vary based on 
quality performance--whereas, as described below, the Medical Home 
Model financial risk standard could be satisfied by such reductions in 
bonus payments if appropriate conditions are met. As such, except when 
the Medical Home Model standard applies, one-sided risk arrangements 
would not meet this financial risk criterion.
    We believe that statute supports a financial risk criterion that 
should be met only by those APMs that are most focused on challenging 
organizations, physicians, and practitioners to assume financial risk 
and provide high-value care. Our proposal reflects our belief that more 
and more APMs will meet this high bar over time. In response to the 
MIPS and APMs RFI, many stakeholders commented that business risk 
should be sufficient to meet this financial risk criterion to be an 
Advanced APM. We also considered whether the substantial time and money 
commitments required by participation in certain APMs would be 
sufficient to meet this financial risk criterion. However, we believe 
that financial risk for monetary losses under an APM must be tied to 
performance under the model as opposed to indirect losses related to 
financial investments APM Entities may make. The amount of financial 
investment made by APM Entities may vary widely and may also be 
difficult to quantify, resulting in uncertainty regarding whether an 
APM Entity had exceeded the nominal amount required by statute. In 
addition to the difficulty in creating an objective and enforceable 
standard for determining whether an entity's business risk associated 
with the Advanced APM exceeds a nominal amount, we strongly believe 
that the statutory scheme under section 1833(z) of the Act recognizes 
that not all APMs will meet this criterion. We do not intend for our 
proposal to diminish the substantial time and money commitments in 
which APM Entities invest in order to become successful participants. 
We welcome comments on how we could potentially create an objective and 
meaningful financial risk criterion that would define financial risk 
for monetary losses based on performance under the APM differently.
(ii) Medical Home Model Standard
    Second, we propose to adopt a slightly different financial risk 
standard for Medical Home Models. For a Medical Home Model to be an 
Advanced APM, it must include provisions that potentially:
     Withhold payment for services to the APM Entity and/or the 
APM Entity's eligible clinicians;
     Reduce payment rates to the APM Entity and/or the APM 
Entity's eligible clinicians;
     Require the APM Entity to owe payment(s) to CMS; or
     Lose the right to all or part of an otherwise guaranteed 
payment or payments, if either:
     Actual expenditures for which the APM Entity is 
responsible under the APM exceed expected expenditures during a 
specified performance period; or
     APM Entity performance on specified performance measures 
does not meet or exceed expected performance on such measures for a 
specified performance period.
    With regard to the proposed financial risk standard for Medical 
Home Models, we believe that the Medical Home Model is a unique type of 
APM that is treated differently under both the MIPS and APM programs. 
For example, under the MIPS clinical practice improvement activity 
performance category, as described in section II.E.3.f of this preamble 
of this proposed rule, eligible clinicians participating in medical 
homes receive an automatic 100 percent score, whereas eligible 
clinicians participating in other APM Entities receive a minimum of a 
50 percent score. Additionally, both Medical Home Models and Medicaid 
Medical Homes Models are distinct from other APMs in

[[Page 28305]]

that, if they are models tested under section 1115A of the Act, there 
is the possibility of having an alternate pathway through expansion 
under section 1115A(c) of the Act to meet the financial risk criterion, 
and Medicaid Medical Home Models play a role in whether Medicaid 
payments or patients are excluded in the All-Payer Combination Option 
for QP determinations (see sections 1833(z)(2)(B)(ii)(I)(bb) and 
(iii)(II)(cc)(BB), 1833(z)(2)(C)(ii)(I)(bb) and (iii)(II)(cc)(BB), 
1833(z)(3)(C)(ii)(II), and 1848(q)(5)(C)(i) of the Act). Medical Home 
Models and their APM Entities (medical homes) are different from other 
APMs in that: (1) Medical homes tend to be smaller in size and have 
lower Medicare revenues relative to total Medicare spending than other 
APM Entities, which affects their ability to bear substantial risk, 
especially in relation to total cost of care; and (2) to date, neither 
publicly nor commercially-sponsored medical homes have been required to 
bear the risk of financial loss, which means the assumption of any 
financial risk presents a new challenge for medical homes. For example, 
a common group practice in the Comprehensive Primary Care (CPC) 
initiative may consist of less than twenty individuals, including 
physicians, non-physician practitioners, and administrative staff. 
Making large lump sum loss payments or going without regular payment 
for a substantial period of time could put such practices out of 
business, whereas large ACOs may comprise an entire integrated delivery 
system with sufficient financial reserves to weather direct short-term 
losses.
    We therefore believe that the unique characteristics of Medical 
Home Models warrant the application of a financial risk standard that 
reflects these differences in order to provide incentives for 
participation in the most advanced financial risk arrangements 
available to medical homes practitioners.
    The proposed financial risk standard for Medical Home Models is 
similar to the generally applicable Advanced APM standard in its first 
three conditions. The difference is in the inclusion of the fourth 
condition for the proposed financial risk standard for Medical Home 
Models, which would allow a performance-based forfeiture of part of all 
of a payment under an APM to be considered a monetary loss. For 
example, a Medical Home Model would meet this standard if it conditions 
the payment of some or all of a regular care management fee to APM 
Entities upon meeting specified performance standards. Because the APM 
does not require any direct payment or repayment to CMS, a medical home 
penalized in such a manner would not necessarily be in a weaker 
financial position than it had been prior to the decreased payment; 
however, it would be in a comparatively worse position in the future 
than it otherwise would have been had it met performance standards. We 
believe that this financial risk standard respects the unique 
challenges of medical homes in bearing risk for losses while 
maintaining a more rigorous standard than business risk.
    We seek comment on the proposed standards set forth for both 
Advanced APM Medical Home Models and for all other APMs. We would 
consider any comments on alternative standards suggested by the public 
that could achieve our stated goals and the statutory requirements. We 
also seek comment on types of financial risk arrangements that may not 
be clearly captured in this proposal.
(4) Nominal Amount of Risk
    If the APM risk arrangement meets the proposed financial risk 
standard, we would then consider whether the amount of the risk is in 
excess of a nominal amount in order for this Advanced APM criterion to 
be met. We believe the statutory requirement that an APM Entity bear 
risk under an APM in excess of a nominal amount (which we will term the 
``nominal amount standard'') relates to a particular quantitative risk 
value at which CMS would consider the risk arrangement to involve 
potential losses of more than a nominal amount. Similar to the 
financial risk portion of this assessment, we propose to adopt a 
generally applicable nominal amount standard for Advanced APMs and a 
unique nominal amount standard for Medical Home Models. Under the 
generally applicable nominal amount standard, the total risk 
percentages are of the APM Entity benchmark or, in the case of episode 
payment models, the target price, which is the amount of Medicare 
expenditures (which can vary as to the involvement of Parts A and B 
depending on the APM) above which an APM Entity owes losses and below 
which an APM Entity earns savings. In the case of Medical Home Models, 
the risk percentages for Medical Home Models are based on Medicare 
Parts A and B revenue. As an alternative, we considered assessing total 
risk under the generally applicable nominal amount standard (for APM 
other than episode payment models) in relation to the APM Entity's 
Parts A and B revenue instead of in relation to the APM benchmark. We 
note that the ratio between entity revenue and the expenditures 
reflected in an APM's benchmark may vary across different types of 
entities, such as when the APM benchmark is based on total cost of 
care. However, we are not proposing the alternative of basing the 
generally applicable standard on Parts A and B revenue because that 
policy would prevent a general determination that an APM meets such 
standards. Instead, it would require case-by-case determinations at the 
APM Entity level that could change from year to year. We are also 
concerned that assessing total risk based on an APM Entity's revenue 
instead of the APM benchmark would set meaningfully different standards 
for different types of entities regarding the extent to which they must 
be held financially responsible if expenditures exceed the benchmark. 
In general, we believe we should apply a common standard to all types 
of entities. That being said, we understand that setting the total risk 
standard too high could create challenges for smaller organizations for 
which a total cost of care benchmark represents more risk in relation 
to revenue than it does for larger organizations.
(a) Advanced APM Nominal Amount Standard
    In general, we believe that the meaning of ``nominal'' is, as plain 
language implies, minimal in magnitude. However, in the context of 
financial risk arrangements, we do not believe it to be a mere 
formality. For instance, we do not believe the law was intended to 
consider one dollar of risk to be more than nominal. That would create 
an arbitrary distinction between an APM that has only upside reward 
potential and one that has the same upside reward potential with a 
fractional and relatively meaningless downside risk. Therefore, in 
arriving at the proposed values, we sought amounts that would be 
meaningful for the entity but not excessive. As reference points to 
anchor the proposed values, we used the percentage amounts of MIPS 
adjustments in the MACRA and surveyed current APM risk arrangements, 
including those in Tracks 2 and 3 of the Shared Savings Program, the 
Pioneer ACO Model, and the Bundled Payments for Care Improvement (BPCI) 
Initiative. We consider the potential losses and marginal risk rates of 
those initiatives to be optimal in that they have been vetted through 
the APM development process and determined to be the appropriate amount 
of risk for each initiative such that, in the context of the APM, it is 
anticipated that the amount of risk

[[Page 28306]]

would motivate the desired changes in care patterns in order to reduce 
costs and improve quality. As stated above, we believe that the term 
``nominal'' is clearly an amount that is lower than optimal but 
substantial enough to drive performance. In other words, we are 
confident that risk levels in current APMs with downside risk are 
sufficient for a wide variety of providers and suppliers, but in 
certain circumstances, we would want to encourage participation in APMs 
with slightly lower levels of risk, though not levels of risk that are 
so low that an APM becomes no more effective at motivating desired 
changes than APMs with no downside risk.
    Except for risk arrangements described under section II.F.4.b.(4) 
of this preamble, we propose to measure three dimensions of risk 
described in this section to determine whether an APM meets the nominal 
amount standard: (a) Marginal risk, which is a common component of risk 
arrangements--particularly those that involve shared savings--that 
refers to the percentage of the amount by which actual expenditures 
exceed expected expenditures for which an APM Entity would be liable 
under the APM; (b) minimum loss rate (MLR), which is a percentage by 
which actual expenditures may exceed expected expenditures without 
triggering financial risk; and (c) total potential risk, which refers 
to the maximum potential payment for which an APM Entity could be 
liable under the APM. Except for risk arrangements described under 
section II.F.4.b.(3) of this preamble, we propose that for a APM to 
meet the nominal amount standard the specific level of marginal risk 
must be at least 30 percent of losses in excess of expected 
expenditures, and a minimum loss rate, to the extent applicable, must 
be no greater than 4 percent of expected expenditures, and total 
potential risk must be at least 4 percent of expected expenditures. As 
described in greater detail in section II.F.7 of this preamble, the 
proposed Other Payer Advanced APM nominal risk standard parallels the 
standard described here for Advanced APMs. In general, we define 
expected expenditures to be the level of expenditures reflected in the 
APM benchmark. However, for episode payment models, we defined expected 
expenditures to be the level of expenditures reflected in the target 
price.
    To determine whether an APM satisfies the marginal risk portion of 
the nominal risk standard, we would examine the payment required under 
the APM as a percentage of the amount by which actual expenditures 
exceeded expected expenditures. We propose that we would require that 
this percentage exceed the required marginal risk percentage regardless 
of the amount by which actual expenditures exceeded expected 
expenditures. APM arrangements with less than 30 percent marginal risk 
would not meet the nominal risk standard. We believe that meaningful 
risk arrangements can be designed with marginal risk rates of greater 
than 30 percent. Any marginal risk below 30 percent creates scenarios 
in which the total risk could be very high, but the average or likely 
risk for an APM Entity would actually be very low. We also propose that 
the payment required by the APM could be smaller when actual 
expenditures exceed expected expenditures by enough to trigger a 
payment greater than or equal to the total risk amount required under 
the nominal risk standard (as specified in Table 28). This is 
essentially an exception to the marginal risk requirement so that the 
standard does not effectively require APMs to incorporate total risk 
greater than the amount required by the total risk portion of the 
standard.
    An example of marginal risk is the sharing rate in the Shared 
Savings Program. For instance, an ACO in Track 2 or Track 3 of the 
Shared Savings Program that has a sharing rate, or marginal risk, of 50 
percent and exceeds its benchmark (expected expenditures) by $1 million 
would be liable for $500,000 of those losses. The inclusion of a 
marginal risk standard is intended to focus on maintaining a more than 
nominal level of average or likely risk under an Advanced APM. For 
instance, a APM with a large (for example, 20 percent of benchmark) 
total potential risk could have a very small (for example, 10 percent) 
sharing rate as its marginal risk, which substantially mitigates the 
amount of loss the APM Entity would reasonably expect to incur. We 
believe that including marginal risk in the Advanced APM financial risk 
criterion clarifies for APM Entities and eligible clinicians the type 
of risk they must bear should they pursue becoming QPs. Focusing on 
marginal risk in the proposed criterion for Other Payer Advanced APMs 
in section II.F.7.b.(6) of this preamble additionally acts as a guard 
against gaming through strategic development of risk arrangements with 
very low marginal risk.
    We propose a maximum allowable ``minimum loss rate'' (MLR) of 4 
percent in which the payment required by the APM could be smaller than 
the nominal amount standard would otherwise require when actual 
expenditures exceed expected expenditures by less than 4 percent; this 
exception accommodates APMs that include zero risk with respect to 
small losses but otherwise satisfy the marginal risk standard. If 
actual expenditures exceed expected expenditures by an amount exceeding 
the MLR, then all excess expenditures (including excess expenditures 
within the MLR) would be subject to the marginal risk requirements. For 
example, ACOs participating in performance-based risk arrangements 
under Tracks 2 and 3 of the Shared Savings Program are permitted to 
choose their own minimum savings rate (MSR) and MLR as long as they are 
symmetrical. If losses do not exceed the chosen MLR, the ACO is not 
held responsible for losses. If the ACO has a very large MLR, there may 
be little to no risk with respect to losses below a certain percentage 
of the benchmark. Therefore, we believe that proposing a maximum 
allowable MLR is appropriate. We recognize that there may be instances 
where an APM can satisfy the marginal risk portion of the nominal risk 
standard even with a high MLR. Therefore, we also propose a process 
through which CMS could determine that a risk arrangement with an MLR 
higher than 4 percent could meet the nominal amount standard, provided 
that the other portions of the nominal risk standard are met. In 
determining whether such an exception would be appropriate, CMS would 
consider: (1) Whether the size of the attributed patient population is 
small; (2) whether the relative magnitude of expenditures assessed 
under the APM is particularly small; and (3) in the case of a test of 
limited size and scope, whether the difference between actual 
expenditures and expected expenditures would not be statistically 
significant even when actual expenditures are 4 percent above expected 
expenditures. We note that CMS would grant such exceptions rarely, and 
CMS would expect APMs considered for such exceptions to demonstrate 
that a sufficient number of APM Entities are likely to incur losses in 
excess of the higher MLR. In other words, the potential for financial 
losses based on statistically significant expenditures in excess of the 
benchmark must remain meaningful for participants.
    To determine whether an APM satisfies the total risk portion of the 
nominal risk standard, we would identify the maximum potential payment 
an APM Entity could be required to make as a percentage of expected 
expenditures under the APM. If that percentage exceeded the required

[[Page 28307]]

total risk percentage, then the model would satisfy the total risk 
portion of the nominal amount standard.
    In evaluating both the total and marginal risk portions of the 
nominal amount standard, we would not include any payments the APM 
Entity or its eligible clinicians would make to CMS under the APM if 
actual expenditures exactly matched expected expenditures. In other 
words, payments made to CMS outside the risk arrangement related to 
expenditures would not count toward the nominal risk standard. This 
requirement ensures that perfunctory or pre-determined payments do not 
supersede incentives for improving efficiency. For example, an APM that 
simply requires an APM Entity to make a payment equal to 5 percent of 
the APM benchmark at the end of the year, regardless of actual 
expenditure performance, would not satisfy the nominal amount standard.
    We believe that this approach to measuring the amount of risk 
flexibly accommodates a wide variety of risk structures, including APMs 
in which marginal risk varies with the amount of losses. For example, 
an APM could have a sharing rate of 75 percent for expenditure amounts 
that exceed the benchmark by up to 2 percent and a sharing rate of 50 
percent for expenditure amounts that exceed the benchmark by 2 percent 
or more. Because the smallest sharing rate is 50 percent, the marginal 
risk rate exceeds 30 percent at all levels of expenditures, so the 
model satisfies the marginal risk portion of the nominal amount 
standard. Because this hypothetical APM does not have MLR or stop loss 
provisions, it satisfies the total risk and MLR portions of the nominal 
amount standard.
    In particular, the financial risk an Advanced APM Entity would bear 
under an Advanced APM need not take a shared savings structure in which 
the financial risk increases smoothly based on the amount by which an 
Advanced APM Entity's actual expenditures exceed expected expenditures. 
An example of a risk arrangement being based on shared savings is 
Tracks 2 and 3 of the Shared Savings Program, where the greater the 
losses in relation to the expenditure benchmark, the greater the 
potential amount of shared losses an ACO would be required to repay 
CMS. On the other hand, an Advanced APM could require APM Entities to 
pay a penalty based on expenditure targets, regardless of the degree to 
which the APM Entity actually exceeded those expenditure targets, 
provided that the payments are otherwise structured in a way that 
satisfies both the marginal and total risk requirements under the 
nominal amount standard.
    We seek comment on appropriate levels for the allowable minimum 
loss rate and the parameters we should consider when determining 
whether a risk arrangement should warrant an exception from the minimum 
loss rate portion of the nominal amount standard.
    Table 28 summarizes the generally applicable nominal amount 
standard. Tables 29 and 30 provide examples of types of risk 
arrangements that would and would not meet the financial risk 
criterion. The examples are divided between shared savings-style 
arrangements in which marginal risk is a component and non-shared 
savings arrangements.
    Figures C and D illustrate types of payment arrangements would meet 
the nominal amount standard. Figure C represents the minimum nominal 
amount standard, so any APM in which the risk for required payments 
would be on or above the line would satisfy the nominal amount 
standard. Figure D represents an example of a risk arrangement that 
would exceed the nominal amount standard.
    We seek comment on the Advanced APM nominal amount standard. In 
particular, we seek comment on whether the Advanced APM benchmark or 
the Advanced APM Entity revenue is a more appropriate basis for 
assessing total risk and on the proposed amounts of total potential 
risk, marginal risk, and maximum allowable minimum loss rate. In 
particular, we seek comment on whether 30 percent is a sufficient level 
of marginal risk to be considered ``more than nominal.'' We also seek 
comment on whether CMS could adopt a meaningful standard that only 
includes total and marginal risk without the minimum loss rate 
component. Finally, we seek comment on a tiered nominal risk structure 
in which different levels of marginal risk could be paired with 
different levels of total risk.
    In commenting on possible alternatives, we encourage commenters to 
refer to the policy principles articulated in section II.F.1 and to 
consider the extent to which their proposed alternatives would be more 
or less consistent with those principles.

[[Page 28308]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.035


[[Page 28309]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.036


[[Page 28310]]


(b) Medical Home Model Standard
    We propose that for Medical Home Models, the total annual amount 
that an Advanced APM Entity potentially owes CMS or foregoes under the 
Medical Home Model must be at least the following amounts in a given 
performance year:
     In 2017, 2.5 percent of the APM Entity's total Medicare 
Parts A and B revenue;
     In 2018, 3 percent of the APM Entity's total Medicare 
Parts A and B revenue.
     In 2019, 4 percent of the APM Entity's total Medicare 
Parts A and B revenue.
     In 2020 and later, 5 percent of the APM Entity's total 
Medicare Parts A and B revenue.
[GRAPHIC] [TIFF OMITTED] TP09MY16.037

    We believe the statute's explicit discussion of medical homes gives 
us unique latitude to separately set financial risk and nominal amount 
standards for Medical Home Models that fall below an amount we consider 
sufficient to be ``more than nominal'' in the context of other types of 
APMs. We also believe that the meaning of the term ``nominal'' depends 
on the situation in which it is applied, so we believe it is 
appropriate to consider the characteristics of the medical home class 
of APM Entities in setting the nominal amount standard for Medical Home 
Models. As we noted in discussing the financial risk standard, few 
medical homes have had experience with financial risk, and many would 
be financially unable to provide sufficient care or even remain a 
viable business in the event of substantial disruptions in revenue. As 
such, we believe we should base the nominal amount standard on the APM 
Entity's total Medicare Parts A and B revenues and also not include a 
potentially excessive level of risk for such entities in the first year 
of the program. Thus, our proposal sets forth a gradually increasing 
but achievable long-term amount of risk that would apply in subsequent 
years. In general, we believe that this scheme allows Medical Home 
Models to craft incentive designs that allow medical homes to succeed 
through care transformation and the provision of high-value care while 
not threatening the ability of small practices to function.
    Some benchmarks are based on total cost of care, and, as discussed 
with respect to the generally applicable nominal amount standard, we 
generally believe that the APM benchmark or target price is the 
appropriate basis for evaluating the nominal amount standard. However, 
we note that, for a small practice, the benchmark can be an amount that 
is significantly greater than the practice's revenue from all payment 
sources. Thus, basing the Medical Home Model nominal amount standard on 
percentage of risk in relation to a total cost of care benchmark would 
mean that certain types of entities would be required to bear greater 
total risk in relation to their revenues than other entities, which we 
believe would be undesirable in light of the special characteristics of 
Medical Home Models. On the other hand, most APMs base risk on the 
benchmark instead of revenue, and using revenue as the basis for 
determining the nominal risk standard could cause the APM Entity's 
eligibility to vary from year to year based on changes in an APM 
entity's revenue despite the core risk arrangement remaining unchanged.
    For the Medical Home Model nominal amount standard, we seek 
additional comment on the length of the proposed multi-year ``ramp up 
period'' and the magnitude of the total risk amounts during such a 
period. We also seek comment on the potential addition of a marginal 
risk amount to the extent applicable and on whether the Advanced APM 
benchmark or Advanced APM Entity revenue is the most appropriate 
standard for measuring total risk.
    In commenting on possible alternatives, we encourage commenters to 
refer to the policy principles articulated in section II.F.1 and to 
consider the extent to which their proposed alternatives would be more 
or less consistent with those principles.
(5) Capitation
    We propose that full capitation risk arrangements would meet the 
Advanced APM financial risk criterion. We propose that, for purposes of 
this rulemaking, a capitation risk arrangement means a payment 
arrangement in which a per capita or otherwise predetermined payment is 
made to an APM Entity for all items and services furnished to a 
population of beneficiaries, and no settlement is performed for the 
purpose of reconciling or sharing losses incurred or savings earned by 
the APM Entity. We also would like to reiterate that--in line with 
statute--Medicare Advantage and other private plans paid to act as 
insurers on the Medicare program's behalf are not Advanced APMs.
    We believe that capitation risk arrangements, as defined here, 
involve full risk for the population of beneficiaries covered by the 
arrangement, recognizing that it might require no services whatsoever 
or could require exponentially more services than were expected in 
calculating the capitation rate. The APM Entity bears the full downside 
and upside risk in this regard. Thus, we believe capitation 
arrangements inherently require an APM Entity to bear financial risk 
for monetary losses in excess of a nominal amount. We propose that, 
where payment is made to participating entities in a APM using a 
capitation risk arrangement, the APM and participating entities would 
meet the criterion under section 1833(z)(3)(D)(ii)(I) of the Act.
    In implementing this proposed policy, it is important to 
distinguish capitation as a risk arrangement from capitation as only a 
cash flow mechanism. A capitation risk arrangement adheres to

[[Page 28311]]

the idea of a global budget for all items and services to a population 
of beneficiaries during a fixed period of time. Cash flow mechanisms 
that make payments in predetermined amounts that are later reconciled 
or adjusted based on actual services are not necessarily a full risk 
arrangement. For example, an APM Entity has a capitation arrangement 
under an APM that pays $1,000 per beneficiary per month for a 
population of 100 beneficiaries, totaling $1.2 million per year. If 
expenditures for services actually furnished to these beneficiaries 
would have totaled $1.3 million if paid on a fee-for-service basis, a 
payment mechanism without risk might make a reconciliation payment of 
$100,000 to the entity. In that case, the APM Entity is not bearing any 
financial risk for monetary losses under the APM. If there is partial 
reconciliation, the arrangement would not meet the proposed capitation 
risk arrangement definition but still may meet the financial risk and 
nominal amount standards through the assessments described in this 
section above. In contrast, if this arrangement is a capitation risk 
arrangement, there would be zero reconciliation for those losses. Under 
our proposal, we would categorically accept that a capitation risk 
arrangement under an APM would meet the Advanced APM financial risk 
criterion.
    We seek comment on our proposal for acceptance of capitation risk 
arrangements and on our proposed definition of a capitation risk 
arrangement. We also seek comment on other types of arrangements that 
may be suitable for such treatment for purposes of this financial risk 
criterion. Finally, we seek comment on potential limits or 
qualifications to the capitation standard in order to prevent potential 
abuse or incentives that are not consistent with the provision of high 
value care.
(6) Medical Home Expanded Under Section 1115A(c) of the Act
    Section 1833(z)(3)(D)(ii)(II) of the Act states that an Advanced 
APM must either meet the financial risk criterion or be a Medical Home 
Model expanded under section 1115A(c) of the Act. We will refer to the 
latter criterion as the expanded Medical Home Model criterion. We 
propose that a Medical Home Model that has been expanded under section 
1115A(c) of the Act would meet the expanded Medical Home Model 
criterion and thus would not need to meet the Advanced APM financial 
risk criterion as described above. Under this this proposal, an APM 
would have to both be determined to be a Medical Home Model as defined 
in this rulemaking and in fact be expanded using the authority under 
section 1115A(c) of the Act. Such expansion is contingent upon whether, 
for an APM tested under section 1115A(b) of the Act:
     The Secretary determines that such expansions is expected 
to reduce spending under the applicable title without reducing the 
quality of care; or improve the quality of patient care without 
increasing spending;
     CMS' Chief Actuary certifies that such expansion would 
reduce (or would not result in any increase in) net program spending 
under the applicable titles; and
     The Secretary determines that such expansion would not 
deny or limit the coverage or provision of benefits under the 
applicable title for applicable individuals. In determining which 
models or demonstration projects to expand under the preceding 
sentence, the Secretary shall focus on models and demonstration 
projects that improve the quality of patient care and reduce spending.
    We note that the expanded Medical Home Model criterion cannot met 
unless a Medical Home Model has been expanded under section 1115A(c). 
Merely satisfying expansion criteria would not be sufficient to meet 
this Advanced APM criterion. This expanded Medical Home Model criterion 
is directly related to a similar criterion addressed in this proposed 
rule for Medicaid Medical Home Models, which addresses how such APMs 
can meet the Other Payer Advanced APM financial risk criterion by 
having criteria comparable to an expanded Medical Home Model. We 
request comments on the proposed requirements for this and all proposed 
Advanced APM criteria.
(7) Application of Criteria to Current and Recently Announced APMs
    Using the Advanced APM criteria proposed in sections II.F.4.b.1-6 
of this preamble, we have identified the current APMs that we 
anticipate would be Advanced APMs for the first QP Performance Period. 
We note that since no CMS Medical Home APMs have been expanded under 
section 1115A(c) of the Act, we have not included this criterion in the 
table.
    The information presented in Table 32 is based on the preliminary 
application of proposed Advanced APM criteria in this preamble and does 
not preclude any changes to the list based on: (1) Any changes made to 
the proposed criteria in the publication of the final rule in response 
to public comments; (2) any modifications to the design of current 
APMs; or (3) any new APMs announced between publication of this 
proposed rule and the beginning of the first QP Performance Period. 
Consistent with our proposal in section II.F.4.a, we propose to post an 
official determination of which APMs would meet the final Advanced APM 
criteria prior to the beginning of the first QP Performance Period and 
update that list in accordingly.
    We note that the Comprehensive Care for Joint Replacement (CJR) 
model does not meet the Advanced APM criteria proposed in sections 
II.F.4.b.1-6 of this preamble. We seek comment on how we might change 
the design of CJR through future rulemaking to make it an Advanced APM, 
and we seek comment on how to include eligible clinicians in CJR for 
purposes of the QP determination as described in section II.F.5.

[[Page 28312]]

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[[Page 28313]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.039

5. Qualifying APM Participant (QP) and Partial QP Determination
    The QP determination process is specified under section 1833(z)(2) 
of the Act, in which QPs are defined as those eligible clinicians who 
meet the specified threshold(s).
    In this section, we propose a process for determining which 
eligible clinicians would be QPs or Partial QPs for a given payment 
year through their participation in Advanced APMs during a 
corresponding QP Performance Period. Per sections 1833(z)(2) and 
1848(q)(1)(C)(ii)(I) and (II) of the Act, an eligible clinician would 
become a QP or Partial QP for a payment year if they are determined at 
the end of the performance period to be eligible clinicians in an 
Advanced APM Entity that collectively meets the threshold values for 
participation in an Advanced APM during the corresponding QP 
Performance Period, and starting in 2021, the threshold values for 
participation in an Other Payer Advanced APMs as proposed here. Each 
year, CMS would determine whether an eligible clinician achieved the 
threshold to become a QP or Partial QP during the corresponding QP 
Performance Period. CMS would make this assessment independent of QP or 
Partial QP determinations made in previous years and accounting for 
Advanced APMs that begin or end on timeframes that do not align 
precisely with the QP Performance Period. The following would apply to 
an eligible clinician whom CMS determines to be a QP for a particular 
year:
     For payment years 2019-2024, the QP will receive a lump 
sum payment equal to 5 percent of the estimated aggregate payment 
amounts for Medicare Part B covered professional services for the prior 
year, as described in section II.F.8 of this preamble;
     The QP will be excluded from MIPS payment adjustments, as 
described in section II.E.3 of this preamble; and
     For payment years 2026 and later, payment rates under the 
Medicare physician fee schedule for services furnished by the eligible 
clinician will be updated by the 0.75 percent qualifying APM conversion 
factor as specified in sections 1848(d)(1)(A) and (d)(20) of the Act.
    Through the APM Entity group determination described in section 
II.F.5.b of this preamble, CMS would identify eligible clinicians who 
do not meet the QP threshold but reach the Partial QP threshold for a 
year to be Partial QPs. Partial QPs would not be eligible for the 5 
percent APM Incentive Payment for years from 2019 through 2024 or, 
beginning for 2026, the qualifying APM conversion factor. However, as 
described below, Partial QPs would have an opportunity to decide 
whether they wish to be subject to a MIPS payment adjustment, which 
could be positive or negative.
    The statute requires that we use two options to determine whether 
an eligible clinician is a QP or Partial QPs for a payment year--one is 
the Medicare Option and, beginning in 2021, the other is the All-Payer 
Combination Option. While these are the terms based on statutory 
language that we have chosen to use for the purposes of describing the 
process by which we can calculate an eligible clinician's Threshold 
Score, we note that the use of the word ``option'' does not imply that 
an eligible clinician will have the ability to choose between the two. 
We further outline in this section our proposed process by which we 
will assess eligible clinicians under both options (beginning in 2021) 
to the extent that sufficient data is submitted to CMS.
    The Medicare Option, described in this section, focuses on 
participation in Advanced APMs, and CMS would make determinations under 
this option based on Medicare Part B covered professional services 
attributable to services furnished through an Advanced APM Entity. The 
Medicare Option is the only option available for QP determinations 
during the first two years of this

[[Page 28314]]

program (payment years 2019-2020). The All-Payer Combination Option, 
described in section II.F.7 of this preamble, is applicable beginning 
in the third payment year (2021) and would allow CMS to make 
determinations based on participation in both Advanced APMs and Other 
Payer Advanced APMs. The All-Payer Combination Option would not replace 
or supersede the Medicare Option; instead it would allow eligible 
clinicians to become QPs by meeting a relatively lower threshold based 
on Medicare Part B covered professional services through Advanced APMs 
and an overall threshold based on services through both Advanced APMs 
and Other Payer Advanced APMs. With our proposals for the QP Threshold 
Score methodologies described in this section, we generally interpret 
payments ``through'' an Advanced APM Entity to mean payments made by 
CMS for services furnished to attributed beneficiaries, who are the 
beneficiaries for whose costs and quality of care an Advanced APM 
Entity is responsible under the Advanced APM. Under section 
1848(q)(1)(C)(iii) of the Act, the calculations used for Partial QP 
determinations are the same, but the threshold percentages to be a 
Partial QP for each year are lower than those required to be a QP.
    The QP and Partial QP Thresholds under the Medicare Option are 
shown in Tables 33 and 35. The QP and Partial QP Threshold values under 
the All-Payer Combination Option are shown in Tables 34 and 36. CMS 
will determine an eligible clinician's QP status for a payment year by 
calculating an eligible clinician's Threshold Score, and comparing the 
eligible clinician's Threshold Score (either based on payment amounts 
or patient counts) to the relevant QP Threshold or Partial QP 
Threshold. In addition, we discuss our proposal to make QP 
determinations at a group level based on an entire Advanced APM Entity 
in section II.F.5.b of this preamble.
    According to section 1833(z)(2)(D) of the Act, the Secretary may 
base the determination of whether an eligible clinician is a QP or a 
Partial QP by using counts of patients in lieu of using payment amounts 
and using the same or similar percentage criteria as those used for the 
payment amount method, as the Secretary determines is appropriate. For 
QP and Partial QP determinations using patient count calculations, we 
propose to use the percentage values displayed in Tables 35 and 36. The 
purpose of the proposed design of the Medicare patient count method is 
to make QP status determinations accessible to entities and individuals 
who are clearly and significantly engaged in delivering value-based 
care through participation in Advanced APMs. We also propose that when 
determining whether to use the payment amounts or patient counts method 
to calculate the QP threshold status, CMS will use both methods in 
tandem for each Advanced APM Entity group of eligible clinicians. We 
further propose that after QP and Partial QP threshold calculations 
have been completed, we will use the QP threshold method that is more 
favorable to the Advanced APM Entity group of eligible clinicians.
    By performing preliminary analyses using our proposed QP 
determination methodologies with historical APM data, we found that the 
proposed QP and Partial QP Patient Count Thresholds are similar in 
magnitude and trajectory to those specified in the statute for the 
payment-based calculations. Due to varying attribution and 
organizational characteristics, we anticipate that using our proposed 
thresholds, the method--payment amount or patient count--that results 
in the most favorable QP status will likely vary across different 
Advanced APMs and Advanced APM Entities. We believe that each eligible 
clinician should have every opportunity to reach the QP threshold for 
each year, and do not intend to limit this opportunity by preemptively 
selecting one method over another.
    We seek comment on the proposed QP Patient Count Threshold and 
Partial QP Patient Count Threshold percentage values for both the 
Medicare Option and the All-Payer Combination Option, on our proposal 
to calculate the Threshold Score under the payment amount and patient 
count methods simultaneously, and on our proposal to use the method 
that is most favorable to the Advanced APM Entity group of eligible 
clinicians.

[[Page 28315]]

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[[Page 28316]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.041

    We propose that, beginning with payment year 2021, CMS will conduct 
the QP determination sequentially so that the Medicare Option is 
applied before the All-Payer Combination Option. We propose to apply 
the All-Payer Combination Option only to an Advanced APM Entity group 
of eligible clinicians or eligible clinicians who do not meet either 
the QP Payment Amount or Patient Count Threshold under the Medicare 
Option but who do meet the lower Medicare threshold for the All-Payer 
Combination Option. This process is illustrated in Figures E and F, 
which show that the first assessment is whether the Medicare QP 
Threshold has been met under either the Medicare Option or the All-
Payer Combination Option.
    Because the Medicare Option (either based on payment amounts or 
patient counts) is also part of the All-Payer Combination Option, and 
because all eligible clinicians must reach at least a minimum Medicare 
Threshold Score through Advanced APMs to be QPs, we believe that this 
sequential approach streamlines the analytic and operational 
requirements to make QP determinations under the All-Payer Combination 
Option. Figure E illustrates the proposed process for making QP 
determinations under the Medicare Option for 2019 and 2020. Figure F 
illustrates the process proposed for making QP determinations under 
both the Medicare and All-Payer Combination Options for payment years 
2021-2024. Figure G provides an example of the proposed process for 
making QP determinations in payment years 2023-2024. Figures E, F, and 
G only discuss the payment amount method, but a similar process would 
apply for the patient count method.

[[Page 28317]]

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[[Page 28318]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.043

a. QP Performance Period
    According to section 1833(z)(2) of the Act, we are required to 
determine QP and Partial QP status based on payment amounts (or patient 
counts) during the most recent period for which data are available 
(which may be less than a year). We propose that the QP Performance 
Period is the full calendar year that aligns with the MIPS performance 
period (for instance, 2017 would be the QP Performance Period for the 
2019 payment year). We believe that having a QP Performance Period 
parallel with the proposed MIPS performance period offers will reduce 
operational complexity and gives CMS the opportunity to clearly 
communicate an eligible clinician's status in this program throughout 
the process. We also believe that having a QP Performance Period that 
concludes one year and one day before the payment year enables CMS to 
provide all eligible clinicians participating in Advanced APMs the best 
opportunity to monitor their performance through the Advanced APM and 
make the most informed decisions regarding their decision whether to 
not to be subject to MIPS in the event that they become a Partial QP. 
We seek comment on this proposal and any alternative QP Performance 
Period timeframes that would both enable meaningful QP assessment and 
ensure operational alignment with MIPS.
[GRAPHIC] [TIFF OMITTED] TP09MY16.044


[[Page 28319]]


b. Group Determination and Lists
(1) Group Determination
    The statute consistently refers to an eligible clinician throughout 
section 1833(z) of the Act and clearly identifies that the QP 
determinations are to be made for an eligible clinician. In section 
1833(z)(3)(B) of the Act, the definition of an eligible clinician 
includes a group of such professionals. We received several comments to 
our MIPS and APMs RFI recommending that CMS make QP determinations at a 
group level and indicating a preference for entity cohesion over a 
highly precise analysis for individual eligible clinicians. Commenters 
stated a number of reasons why they recommended that QP determinations 
should be made at the group level. These reasons included promoting 
administrative simplicity, the need to foster collaboration among group 
members (instead of promoting barriers), and the fact that while many 
beneficiaries are attributed to an APM Entity based on the services 
rendered by one eligible clinician, many of the eligible clinicians 
participating in the APM Entity may play a role in the actual 
diagnosis, treatment, and management of many beneficiaries in the APM 
Entity population. Each of these individual eligible clinicians could 
potentially view themselves as being instrumental in providing quality 
care to the beneficiary that is in line with the objectives of the APM, 
regardless of whether their individual services are counted towards 
APM-specific attribution methods. A few commenters indicated that the 
Advanced APM Entities themselves should determine whether individual 
eligible clinicians meet the annual threshold to become a QP.
    An Advanced APM Entity faces the risks and rewards of participation 
in an Advanced APM as a single unit, and is responsible for performance 
metrics that are aggregated to the level of that entity. This policy is 
also based on the premise that positive change occurs when entire 
organizations commit to participating in an Advanced APM and focusing 
on its cost and quality goals as a whole. It also mitigates situations 
in which individual eligible clinicians who practice together in an 
Advanced APM Entity receive different QP determinations and thus are 
treated differently for purposes of APM Incentive Payments, MIPS 
payment adjustments, and eventually, differential fee schedule updates 
under the PFS. We believe that such discrepancies could potentially 
lead to confusion and lack of cohesion among eligible clinicians and 
Advanced APM Entities and place additional burdens on eligible 
clinicians and organizations to track these differences. Additionally, 
we wish to avoid any additional burden, confusion, and operational 
difficulties for both eligible clinicians and CMS that would result 
from allowing eligible clinicians or Advanced APM Entities to elect 
whether to be assessed at the Advanced APM Entity level. We believe 
that a simple, overarching rule is preferable to adding extra variables 
to the already complex processes under this program.
    We understand that, as with any group assessment, there will be 
some situations in which individual Threshold Scores would differ from 
group Threshold Scores if assessed separately. This could lead to some 
eligible clinicians becoming QPs when they would not have met the QP 
Threshold individually (a ``free-rider'' scenario) or, conversely, some 
eligible clinicians not becoming QPs within an Advanced APM Entity when 
they might have qualified individually (a dilution scenario). We 
believe that through the methodology we propose for QP determination in 
this proposed rule, the magnitude of such discrepancies will be 
relatively small compared to the value of maintaining Advanced APM 
Entity cohesion.
    We propose, except in the specific situations discussed below in 
this section, to make the QP determination at a group level. As a 
result, the QP determination for the group would apply to all the 
individual eligible Clinicians who are identified as part of an 
Advanced APM Entity. If that eligible Clinician group's collective 
Threshold Score meets the relevant QP threshold, all eligible 
Clinicians in that group would receive the same QP determination for 
the relevant year. The QP determination calculations described in this 
proposed rule would be aggregated using data for all eligible 
clinicians participating in the Advanced APM Entity during the QP 
Performance Period.
    In some cases, the list of eligible clinicians who will be grouped 
together for purposes of the QP determination may include eligible 
clinicians who have relationships with the Advanced APM Entity but no 
relationship with each other. We believe this is appropriate for 
purposes of the QP determination because it support the Advanced APM 
Entity as the coordinator of its participating eligible clinicians to 
contribute to its success and promotes eligible clinician coordination 
when appropriate to further the success of the Advanced APM Entity.
(2) Groups Used for QP Determination
    We propose that the group of eligible clinicians would consist of 
all the eligible clinicians identified as participants in an Advanced 
APM Entity during the QP Performance Period on a Participation List 
provided to CMS, with one exception for Advanced APMs whose 
participants are not eligible clinicians. We propose to define 
participant for the purposes of participation in an APM as an entity 
participating in an APM under an agreement with CMS or statute or 
regulation that may either include eligible clinicians or be an 
eligible clinician and that is directly tied to beneficiary 
attribution, quality measurement or cost measurement under the APM. 
This definition encapsulates those entities and eligible clinicians 
under an APM who have roles of central importance to performance under 
the APM. We propose that the Participation List for each Advanced APM 
Entity would be compiled from CMS-maintained lists that will be used to 
identify each eligible clinician by a unique TIN/NPI combination 
attached to the identifier of the Advanced APM Entity. Therefore, an 
eligible clinician must be officially identified using an Advanced APM 
Entity's Participation List to be part of the QP determination for that 
group.
    In APMs, the APM Entity that has an agreement with CMS or is 
identified as such under statute or regulation is considered a 
participant in the APM. Some APMs have eligible clinicians under the 
APM Entity who are also under our definition considered participants in 
the Advanced APM Entity. For example, in an APM like the Comprehensive 
Primary Care Initiative with physician group practices as participants, 
the APM Entity, the Practice, may have a Participation List it provides 
to CMS that can be used to identify each eligible clinician participant 
participating in the APM through that APM Entity by a unique TIN/NPI 
combination attached to the identifier of the APM Entity. As stated 
above, we propose to include of all the eligible clinicians identified 
using a Participation List as participants in an Advanced APM Entity 
during the QP Performance Period for purposes of the QP determination.
    In certain APMs, a Participation List may not include any eligible 
clinicians. For example, in an APM where all APM Entities are 
hospitals, the APM Entity will not have eligible clinicians identified 
by a unique TIN/NPI combination attached to the identifier of the 
Advanced APM Entity on a

[[Page 28320]]

Participation List because there will not be eligible clinicians who 
are participants under the APM Entity. An Advanced APM Entity may have 
a list of entities, including eligible clinicians, who are affiliated 
with and support the Advanced APM Entity in its participation in the 
Advanced APM, but are not participants and are therefore not on a 
Participation List. For example, a list of gainsharers under an APM 
might include eligible clinicians where the Participation List does 
not.
    Where there is a Participation List that can be used to identify 
eligible clinicians, we propose that it automatically be the list that 
is considered for the QP Determination. Where there is no Participation 
List that can be used to identify eligible clinicians, but there is 
another list of eligible clinicians who have a contractual relationship 
with the Advanced APM Entity based at least in part on supporting the 
Advanced APM Entity's quality or cost goals under the Advanced APM 
(Affiliated Practitioners), we propose to use the list of those 
eligible clinicians, the Affiliated Practitioner List, for purposes of 
the QP determination. Where there is both a Participation List and an 
Affiliated Practitioner List that can be used to identify eligible 
clinicians under an Advanced APM, we propose only to use the 
Participation List for purposes of the QP determination. We seek 
comment on whether to limit the proposed policy to use an Affiliated 
Practitioner List for the QP Determination to the Medicare payment 
threshold option, as it may be less likely that Affiliated 
Practitioners support the Advanced APM Entity as a group in Other Payer 
Advanced APMs than eligible clinicians on a Participation List.
    This proposed policy was developed to capture the group or groups 
of eligible clinicians who are the most closely associated with the 
performance of the Advanced APM Entity under an Advanced APM and to 
recognize their role in supporting the Advanced APM Entity. We believe 
this policy appropriately considers those eligible clinicians who have 
the most central role or roles in supporting the Advanced APM Entity's 
performance under an Advanced APM to be the eligible clinician group 
for purposes of the QP determination. We believe this policy provides 
for flexibility in the design of Advanced APMs while providing the APM 
Incentive Payment to those eligible clinicians who are the most engaged 
in the Advanced APM. We believe this will promote more robust 
engagement by eligible clinicians in Advanced APMs, and appropriately 
incentivize participation in Advanced APMs where eligible clinicians 
have a less direct relationship with the Advanced APM Entity than 
eligible clinicians who are on a Participation List. We also believe 
that although the relationship an Affiliated Practitioner has with an 
Advanced APM Entity is less direct than an eligible clinician on a 
Practitioner List, the contractual relationship the Affiliated 
Practitioner has with the Advanced APM Entity is sufficient for an 
Affiliated Practitioner can become a QP based on their support of the 
Advanced APM Entity.
    We seek comment on our proposals for defining the eligible 
clinician group for QP determinations, particularly our proposals to 
define the eligible clinician group for QP determination as the 
Participation List, and the exception for Advanced APMs in which there 
are no eligible clinicians on the Participation List but there are 
eligible clinicians on an Affiliated Practitioner List. Because there 
may be Advanced APMs in the future that have multiple lists of 
Affiliated Practitioners, we plan to propose a policy for such 
situations in future rulemaking, and we seek comment on approaches for 
grouping those separate lists for purposes of the QP determination.
(3) Timing of Group Identification for Eligible Clinicians
    We propose that we will identify the eligible clinician group for 
each Advanced APM Entity at a specified point in time for each QP 
Performance Period. We propose that this point in time assessment will 
occur on December 31st of each QP Performance Period. We believe that 
taking a ``snapshot'' of the participant list on the last day of the 
proposed QP Performance Period provides the best opportunity to 
comprehensively assess the eligible clinicians' active participation in 
an Advanced APM throughout an entire QP Performance Period. Under this 
proposal, we would use the eligible clinicians identified using the 
Participant List as the group of eligible clinicians who would be 
assessed together for the purposes of QP determination. We considered 
taking the ``snapshot'' at an earlier point in the QP Performance 
Period, but we felt that because certain APMs allow for changes in 
participation (either adding or dropping participants from the APM 
Entity) during the calendar year, an earlier ``snapshot'' date would 
not be the most accurate reflection of active eligible clinician 
participation in a APM throughout the QP Performance Period. We believe 
that these proposals maintain cohesiveness for eligible clinicians and 
Advanced APM Entities and maintain consistency with the participation 
structure of Advanced APMs.
    We seek comment on our proposal to assess each Participation List 
for each Advanced APM Entity at a specified point in time during the QP 
Performance Period. We also seek comment on the proposed date of the 
Participant List assessment, and whether this date should be earlier in 
the QP Performance Period or should instead be a range of time.
(3) Exception
    We propose one exception to making QP determinations at the group 
level. Some eligible clinicians may participate in multiple Advanced 
APMs. For instance, an eligible clinician could participate in an ACO 
under the Shared Saving Program and an episode payment model with 
another entity, both of which have been determined to be Advanced APM 
Entities. In such a case, we propose the following:
     Consistent with the general policy proposed above, if one 
or more of the Advanced APM Entities in which the eligible clinician 
participates meets the QP threshold, the eligible clinician becomes a 
QP.
     If none of the Advanced APM Entities in which the eligible 
clinician participates meet the QP threshold, CMS proposes to assess 
the eligible clinician individually, using combined information for 
services associated with that individual's NPI and furnished through 
all such eligible clinician's Advanced APM Entities during the QP 
Performance Period. CMS will adjust to assure that services are not 
double-counted (for example, a surgeon participating in a bundled 
payments model, in which some of the procedures are performed on 
patients affiliated with an ACO that the surgeon is also a part of, 
would only have payments or patients from those procedures count once 
towards the QP determination).
    We believe that this proposal maintains the general simplicity of 
the Advanced APM Entity-level QP determination while acknowledging 
individual eligible clinicians who are participating in multiple 
advanced initiatives that support CMS goals. This also complements the 
policy described under the All-Payer Combination Option for QP 
determinations in which an eligible clinician may submit information on 
participation in Other Payer Advanced APMs in order to be assessed as 
an individual under that option in the event that the APM Entity or 
Entities in which the eligible

[[Page 28321]]

clinician participates do not submit sufficient information.
    We seek comment on the proposal to make most QP determinations at 
the Advanced APM Entity level and our proposals for exceptions to that 
policy. In particular, we seek comment on the merits of making all 
determinations at the individual eligible clinician level versus 
through some alternative grouping methodology. We also seek comment on 
our proposal to assess an eligible clinician who participates in 
multiple Advanced APM Entities, and any other potential exceptions to 
the proposed general policy to make QP determinations at the Advanced 
APM level.
c. Partial QP Election To Report to MIPS
    Section 1848(q)(1)(C)(ii)(II) of the Act excludes from the 
definition of MIPS eligible clinician an eligible clinician who is a 
Partial QP for a year. However, under section 1848(q)(1)(C)(vii) of the 
Act, an eligible clinician who is a Partial QP for a year and reports 
on applicable measures and activities as required under the MIPS is 
considered to be a MIPS eligible clinician for the year. To carry out 
these provisions, we propose to require that each Advanced APM Entity 
must make an election each year on behalf of all of its identified 
participating eligible clinicians on whether to report under MIPS in 
the event that the eligible clinicians participating in the Advanced 
APM Entity are determined as a group to be Partial QPs for a year. We 
propose that the Advanced APM Entity could change its election for a 
year at any time during the QP Performance Period, but the election 
would become permanent at the close of the QP Performance Period. We 
believe that this is consistent with our proposed general policy to 
make QP determinations at the Advanced APM Entity level; and with 
related MIPS policies described in section II.E.3.h of this preamble, 
under which we propose that each APM Entity would be considered a group 
for purposes of MIPS reporting. Therefore, we believe that the decision 
of whether to report and subsequently be subject to MIPS adjustments 
should also be made at the group level. We seek comment on whether the 
Advanced APM Entity or each individual eligible clinician should make 
the Partial QP MIPS reporting election.
    As discussed in section II.E.3.h. of this preamble, we recognize 
that the Shared Savings Program eligible clinicians participate as a 
complete TIN such that all of the eligible clinician participants in 
the participant billing TIN participate in the Shared Savings Program. 
Therefore, we also seek comment on an alternative approach for Shared 
Savings Program APM Entities in which each individual billing TIN 
participating in the APM Entity would make the Partial QP election on 
behalf of its individual eligible clinicians and that election would be 
applied to all eligible clinicians in that individual billing TIN, as 
opposed to having the APM Entity (ACO) make the Partial QP election. We 
would only undertake this alternative paired with determining MIPS CPS 
for each TIN within an APM Entity (ACO) at the TIN level, an 
alternative discussed under the APM scoring standard elsewhere in this 
proposed rule.
    Our proposal that Partial QPs may choose whether to report to MIPS 
has two additional interactions with other proposed policies. First, 
because we have proposed unique MIPS scoring policies for MIPS eligible 
clinicians participating in certain APMs, the election by the APM 
Entity not to report under MIPS is in effect a decision to tell CMS not 
to score the information submitted by the APM Entity under MIPS. Under 
our proposal, that decision would be made at the APM Entity level. APM 
Entities and eligible clinicians would continue to report to their 
respective APMs as required under the terms of their participation 
agreements with CMS.
    Second, given the proposed timeframe for QP determinations under 
section II.F.5.a, our proposed treatment of claims run-out, claims 
adjustments, supplemental service payments, and alternative payment 
methods for purposes of QP determination (further detailed in section 
II.F.8 of this preamble), and the and subsequent notification of QP 
determinations proposed under section II.F.5.d of this preamble, 
eligible clinicians who become Partial QPs would not receive 
notification of this status until after the proposed timeframe for the 
MIPS reporting period will have closed. We do not believe that it would 
be in the best interest of APM Entities and eligible clinicians, nor 
would it be operationally feasible, to have APM Entities wait to make a 
Partial QP election to be included in MIPS until after the close of the 
MIPS reporting period. Although the information necessary for MIPS 
reporting would already be prepared in the CMS systems by the time the 
Partial QP determination is made, a prospective election by the 
Advanced APM Entity to not be scored under MIPS and receive a MIPS 
payment adjustment would signal us to not transfer information from our 
reporting system to the MIPS scoring system in the event of a Partial 
QP determination, and that any submitted information is not to be used 
for purposes of a MIPS assessment or payment adjustment. Thus, by 
choosing not to report under MIPS, those Advanced APM Entities and 
eligible clinicians determined to be Partial QPs would be exempted from 
the MIPS payment adjustment for that year. We seek comment on the 
timing and process for Advanced APM entities to elect whether to be 
subject to MIPS in the event of a Partial QP determination. 
[GRAPHIC] [TIFF OMITTED] TP09MY16.045


[[Page 28322]]


d. Notification of QP Determination
    We propose to notify both Advanced APM Entities and their 
participating eligible clinicians of their QP and Partial QP status as 
soon as CMS has made the determination and performed all necessary 
validation of the results. Given the proposed timeframe for QP 
determinations under section II.F.5.a of this preamble and our proposed 
treatment of claims run-out (further detailed in section II.F.8 of this 
preamble), we do not anticipate that this notification could be made 
before the summer of the subsequent year. We propose that this 
notification would be made directly to the Advanced APM Entity and 
eligible clinician, and made in combination with a general public 
notice on the CMS Web site that such determinations have been completed 
for the applicable QP Performance Period. We propose that this 
notification would also contain other necessary and useful information, 
such as what actions, if any, an Advanced APM Entity or eligible 
clinician may or should take with respect to MIPS. We believe that this 
is the most efficient method for dissemination of this information to 
all QPs, Partial QPs, and MIPS eligible clinicians.
    We seek comment on our proposals to make the QP and Partial QP 
status notifications. We also seek comment on an alternative approach 
for Shared Savings Program ACOs in which we would separately notify 
each billing TIN participating in the ACO. We seek comment on other 
methods and media for the notification of QP and Partial QP status. We 
also seek comment on the content of such notifications so that they may 
be as clear and useful as possible.
6. Qualifying APM Participant Determination: Medicare Option
a. In General
    Under the Medicare Option, we propose to calculate a Threshold 
Score for an Advanced APM Entity--or eligible clinician in the cases of 
an exception described in section II.F.5.b of this preamble--based on 
participation in an Advanced APM by analyzing claims for Medicare Part 
B covered professional services. Under the alternative calculation 
using patient counts in lieu of payments (patient count method), we 
propose to similarly calculate a Threshold Score for the Advanced APM 
Entity based on patient attribution as described below. Under either 
the payment amount or patient count method, only Medicare Part B 
covered professional services under the physician fee schedule will 
count toward the numerator and denominator of the Threshold Score 
calculation.
    Section 1833(z)(2)(A), (B)(i) and (C)(i) of the Act describes the 
QP determination using the Medicare payment method as follows: A QP is 
an eligible clinician whose payments under this part for covered 
professional services furnished by such professional during the most 
recent period for which data are available (which may be less than a 
year) were attributable to such services furnished under this part 
through an Advanced APM Entity. Section 1833(z)(2)(D) of the Act 
describes the basis for the patient count method.
(1) Definitions
    In section II.F.3 of this preamble, we propose two definitions that 
would apply specifically for the purposes of QP determination: 
Attributed beneficiary and attribution-eligible beneficiary. Each term 
describes a particular relationship between an Advanced APM Entity and 
the beneficiaries for whose cost and quality of care the participating 
eligible clinicians are held accountable. These terms are the 
foundation for how we propose to count services furnished through an 
Advanced APM Entity.
    In section II.F.3 of this preamble, we propose that ``attributed 
beneficiary'' be defined as a beneficiary attributed to the Advanced 
APM Entity on the latest available list of attributed beneficiaries 
during the QP Performance Period based on each APM's respective 
attribution rules. There are some natural advantages to using this term 
for the purposes of QP determination because it is consistent with how 
many APMs--including the Shared Savings Program (assigned 
beneficiaries), Next Generation ACO Model (aligned beneficiaries), and 
BPCI Model (attributed beneficiaries) identify the beneficiaries whose 
outcomes and costs are included in an APM Entity's assessment. We 
believe that using the same construct also coordinates the incentives 
under the Advanced APM with the incentives under MACRA by addressing 
the same beneficiary population.
    In most episode payment models, such as the CJR Model, attribution 
is defined by the beneficiaries who trigger the defined episode of care 
under the model, often by presenting with a specific condition at the 
location of a participating APM Entity. In many attribution-based APMs, 
such as ACO initiatives or the Comprehensive Primary Care Initiative, 
CMS attributes beneficiaries to APM Entities through claims-based 
algorithms that identify the APM Entity with the plurality of 
evaluation and management visits for a beneficiary. In addition, most 
APMs do not allow beneficiaries to be attributed to more than one APM 
Entity. This means that the greater the APM Entity density in a market, 
the lower the attributed population for a given APM Entity will be as a 
percent of its total beneficiaries. We seek comment on the proposed 
methodology for defining the attributed beneficiary population, 
including comment on alternative methods for capturing the most 
meaningful cohort of attributed beneficiaries.
    Under these plurality-based approaches, typically only 30-50 
percent of an Advanced APM Entity's total population of beneficiaries 
for whom its eligible clinicians furnish services are actually 
attributed to the Advanced APM Entity for a performance period. These 
percentages reflect a combination of CMS' design decisions, 
beneficiaries' underlying care patterns, and the fact that 
beneficiaries in Medicare FFS retain freedom of choice to select 
clinicians. These percentages reflect conditions that are not entirely 
under the control of the APM Entity or its eligible clinicians. Thus, 
we recognize that because Advanced APMs have different attribution 
methodologies, using the specific Advanced APM attributed beneficiary 
as the definition may create a standard that advantages or 
disadvantages participation in certain Advanced APMs relative to others 
simply based on the specific attribution policies.
    The unintended consequence would be that greater APM participation 
in a given market could make it impossible for many highly engaged 
Advanced APM Entities to reach a 50 percent or 75 percent QP Payment 
Amount Threshold. The result could be that an ACO functioning under 
arrangements with significant financial risk, (for example, in the Next 
Generation ACO Model or Track 3 of the Shared Savings Program), would 
still not meet the QP threshold, particularly in later years of the 
program under higher thresholds. We believe this would undercut our 
stated CMS goal of broadly increasing participation in advanced APMs, 
and we have attempted to compensate for these differences with how we 
propose to define the terms attributed beneficiary and attribution-
eligible beneficiary for the purposes of making QP determinations.
    Consistent with our proposed definition of attributed beneficiary, 
our proposed definition for an attribution-eligible beneficiary would 
allow us to be

[[Page 28323]]

more consistent across Advanced APMs in how we consider the population 
of beneficiaries served by an Advanced APM Entity for the purposes of 
QP determination. To be attributed to an Advanced APM Entity in an 
Advanced APM, a beneficiary is first required to first meet certain 
eligibility criteria. Specifically, for purposes of QP determinations, 
we propose that an attribution-eligible beneficiary would be one who:
    (1) Is not enrolled in Medicare Advantage or a Medicare cost plan.
    (2) Does not have Medicare as a secondary payer.
    (3) Is enrolled in both Medicare Parts A and B.
    (4) Is at least 18 years of age.
    (5) Is a United States resident.
    (6) Has a minimum of one claim for evaluation and management 
services by an eligible clinician or group of eligible clinicians 
within an APM Entity for any period during the QP Performance Period.
    An attribution-eligible beneficiary may or may not be an attributed 
beneficiary. Attributed beneficiaries are a subset of attribution-
eligible beneficiaries. Much like the term ``attributed beneficiary,'' 
the term attribution-eligible beneficiary is generally consistent with 
the attribution methodologies used in most current APMs--such as the 
Shared Savings Program and the Next Generation ACO Model--to identify 
the beneficiaries who could potentially be attributed to an APM Entity. 
Although the factors we are proposing for the definition of an 
attribution-eligible beneficiary in this context would only apply for 
the purposes of QP determinations, and would not change APM-specific 
methodologies, we believe that the factors in the proposed definition 
are representative of the methodologies most current APMs use to 
perform attribution. Therefore, we believe it would serve as a 
practical common set to apply in QP threshold calculations.
    The purpose of using the attribution-eligible construct is to 
ensure that the denominator of QP determination calculations described 
in this section only includes payments for services furnished to 
patients who could potentially be attributed to an Advanced APM Entity 
under the Advanced APM, and thus could also appear in the numerator of 
the QP determination calculations. We believe that including amounts in 
the denominator that could not possibly be included in the numerator 
would be arbitrarily punitive toward certain Advanced APM Entities that 
furnish services to a substantial population of non-attribution-
eligible beneficiaries.
    We note that specialty-focused or disease-specific APMs may have 
attribution methodologies that are not based on evaluation and 
management services. Therefore, we anticipate needing targeted 
exceptions, especially related to the sixth factor of the definition of 
attribution-eligible beneficiary, for such APMs so that the attributed 
beneficiary population is truly a subset of the attribution-eligible 
population. Such exceptions would be made either through rulemaking or 
using available waiver authority and would be announced when the APM is 
announced.
    For example, under the CEC Model, one criterion, among others, to 
be an aligned beneficiary requires that the beneficiary receive 
maintenance dialysis services. In the event that the CEC Model were 
determined to be an Advanced APM, we would consider attribution-
eligible beneficiaries for the APM Entities participating in the CEC 
Model to be beneficiaries that meet the first five criteria outlined 
above and that have had at least one maintenance dialysis service 
billed through the Advanced APM Entity during the QP Performance 
Period. We would make this exception for the CEC Model to ensure that 
the denominator of QP determination calculations described in this 
section only includes payments for services furnished to patients who 
could potentially be attributed to an Advanced APM Entity under the 
Advanced APM.
    Although the availability of such exceptions, as outlined above, 
would create multiple standards, we believe this slightly more complex 
approach is more appropriate and equitable because it is consistent 
with the design of APMs. An alternative approach could be to have a 
simple standard that includes in the denominator all beneficiaries who 
are furnished any Medicare Part B covered professional service by 
eligible clinicians participating the Advanced APM Entity.
    We seek comment on the proposed general definition of attribution-
eligible beneficiary. We further seek comment on our proposal to use of 
APM-specific standards as necessary to fulfill our expressed goals for 
specialty- or disease-focused APMs that may use alternative attribution 
methodologies.
(2) Attribution
    We propose to use the attributed beneficiaries on Advanced APM 
attribution lists generated by each Advanced APM in making QP 
determinations. We also propose that the attributed beneficiary list 
would be taken from the Advanced APM's latest available list at the end 
of the QP Performance Period prior to making the QP determinations. For 
episode payment models, attributed beneficiaries would be those 
beneficiaries who trigger episodes of care under the terms of the APM.
    We believe that this approach to attribution lists maintains 
consistency with the panel of beneficiaries for whom Advanced APM 
Entities are responsible under their respective Advanced APMs during 
the QP Performance Period. Therefore, we believe that such lists would 
be appropriate for use in QP determinations. Advanced APM Entities are 
already accustomed to providing care for the panel of beneficiaries 
represented by their APM Entity specific list. We believe that our 
proposal to link attribution for QP determination to Advanced APM 
attribution lists further strengthens the goals of the Advanced APMs in 
which these Advanced APM Entities participate. By using the same 
beneficiary population for QP determination purposes, Advanced APM 
Entities may continue focusing on the care they furnish to the same 
panel of attributed beneficiaries, instead of shifting focus and 
changing practice patterns to reach a QP threshold. As stated in our 
principles in section II.F.1 of this preamble, we intend for the QP 
determination process to seamlessly reward participation in the most 
advanced APMs, not to create a new set of performance standards 
distinct from the goals of APMs.
    We seek comment on our proposal for determining which beneficiaries 
are considered attributed to an Advanced APM Entity for a QP 
Performance Period.
b. Payment Amount Method
    This section describes our proposal for calculating a Threshold 
Score for the eligible clinician group in an Advanced APM Entity--or 
individual eligible clinician in the exception situations under section 
II.F. 6 of this preamble--using the payment amount method, which would 
then be compared to the relevant QP Payment Amount Threshold and 
Partial QP Payment Amount Threshold to determine if the eligible 
clinician meets the QP status for a payment year.
(1) Claims Methodology and Adjustments
    For the payment amount method, section 1833(z)(2)(A), (B)(i) and 
(C)(i) of the Act requires that we use payments for Medicare Part B 
covered professional services to make QP determinations.

[[Page 28324]]

Covered professional services are defined under section 1848(k)(3)(A) 
of the Act as services for which payment is made under, or based on, 
the PFS. The payment amounts discussed in this proposal only include 
payments for Medicare Part B services under, or based on, the Physician 
Fee Schedule, even if an Advanced APM bases attribution and/or 
financial risk on payments other than or in addition to Medicare Part B 
payments.
    We propose to use all available Medicare Part B claims information 
generated during the QP Performance Period. Additionally, we propose 
that CMS will treat claims run-out, claims adjustments, supplemental 
service payments, and alternative payment methods in the same manner 
for purposes of calculating both the Threshold Score and for 
determining the APM Incentive Payment amount. We further detail our 
proposals to account for claims run-out, claims adjustments, non-
claims-based payments, and alternative payment methods in section 
II.F.8 of this preamble.
    We believe it is appropriate to maintain consistency across the QP 
determination and the incentive payment calculation in order to support 
internal CMS operational consistencies. It also ensures that any unique 
payment mechanisms within an Advanced APM do not affect the opportunity 
for an eligible clinician to reach the QP threshold.
    We seek comment on whether the claims methodology we use under the 
Medicare payment method should align with the proposed claims 
methodology for purposes of calculating the estimated aggregate payment 
amount for the APM Incentive Payment.
(2) Threshold Score Calculation
    In general, our proposed method for deriving a Threshold Score for 
an Advanced APM Entity is to divide the value described under paragraph 
(a) below by the value described under paragraph (b) below. This 
calculation would result in a percent value that CMS would compare to 
the QP Payment Amount Threshold and the Partial QP Payment Amount 
Threshold to determine the QP status for all eligible clinicians in the 
Advanced APM Entity for the payment year.
(a) Numerator
    We propose that the numerator for this calculation would be the 
aggregate of all payments for Medicare Part B covered professional 
services furnished by the eligible clinicians in the Advanced APM 
Entity to attributed beneficiaries during the QP Performance Period.
    We believe that this method is the most logical reading of the 
statute and is reflective of the population of beneficiaries for whom 
an Advanced APM Entity is responsible for cost and quality. Therefore, 
we believe that counting payments for covered professional services 
furnished to attributed beneficiaries is the most suitable metric for 
payments that are attributable to services furnished ``through'' an 
Advanced APM Entity. In episode payment models, because a beneficiary 
is considered attributed during the course of an episode, the payments 
included in the numerator for this calculation are those for Medicare 
Part B covered professional services furnished to an attributed 
beneficiary by eligible clinicians in the Advanced APM Entity during 
the course of an episode.
    One program integrity concern is that an Advanced APM Entity might 
meet the higher QP Payment Amount Threshold in later years by providing 
substantially disproportionate amounts of care for attributed 
beneficiaries relative to all others. However, because of the financial 
risk an Advanced APM Entity bears, which is usually based on 
expenditures, we believe that the relatively large potential loss under 
the Advanced APM would outweigh the advantage of any overutilization 
geared toward abusing Threshold Score calculations.
    We seek comment on any alternative numerators we could use for 
purposes of the Medicare payment method that meaningfully meet 
statutory requirements, are understandable, and operationally feasible.
(b) Denominator
    We propose that the denominator in the Medicare payment method 
would be the aggregate of all payments for Medicare Part B covered 
professional services furnished by the eligible clinicians in the 
Advanced APM Entity to attribution-eligible beneficiaries during the QP 
Performance Period. We propose that when the QP determination is made 
at the eligible clinician level as described in section II.F.5 of this 
preamble, the denominator will be the total of all payments for 
Medicare Part B covered professional services furnished to attribution-
eligible beneficiaries by the eligible clinician. In episode payment 
models, the payments included in the denominator for this calculation 
are those for Medicare Part B covered professional services furnished 
to any attribution-eligible beneficiary by eligible clinicians in the 
Advanced APM Entity. This includes all such services to all 
attribution-eligible beneficiaries whether or not such services occur 
during the course of an episode under the Advanced APM.
    We believe that this denominator represents a meaningful alignment 
with the way in which current APMs perform attribution. Including 
payment for services furnished only to attribution-eligible 
beneficiaries standardizes the denominator to ensure fairness across 
types of eligible clinicians and geographic regions. By using the 
attribution-eligible population, the denominator will not penalize 
entities for furnishing services to beneficiaries who could not 
possibly be in the numerator through attribution under an Advanced APM. 
For example, an ACO's eligible clinicians may furnish services to a 
large population of beneficiaries with Medicare as a secondary payer. 
Those beneficiaries may not be eligible for attribution to the ACO, and 
could never be included in the numerator. Therefore, we believe that 
this methodology focuses on factors for which Advanced APM Entities 
have some control rather than those for which they may have no control 
or that disadvantage certain organizational structures or types of 
APMs. We seek comment on alternative methods that are consistent with 
the statutory language.
c. Patient Count Method
    Similar to the Medicare payment method, this section describes our 
proposal for calculating a Threshold Score for the eligible clinicians 
participating in an Advanced APM Entity--or eligible clinician in 
situations under section II.F.6 of this preamble--using the Medicare 
patient count method, which would then be compared against the relevant 
QP Patient Count Threshold and Partial QP Patient Count Threshold to 
determine the QP status of an eligible clinician for the year. Given 
our authority under section 1833(z)(2)(D) of the Act to use patient 
counts in lieu of payments ``as the Secretary determines appropriate,'' 
we are interpreting the patient count method to offer a more flexible 
alternative to the payment method. As previously mentioned, the purpose 
of the proposed design of the Medicare patient count method is to make 
QP status determinations accessible to entities and individuals who are 
clearly and significantly engaged in delivering value-based care 
through participation in Advanced APMs.
(1) Unique Beneficiaries
    We propose that when counting the number of beneficiaries under 
this

[[Page 28325]]

method, CMS may count a given beneficiary in the numerator and 
denominator for multiple different Advanced APM Entities. For example, 
during a year, a beneficiary may be attributed to an ACO, Advanced APM 
Entity 1, be treated for an episode of care for a particular condition 
in a hospital participating in an episode payment model as Advanced APM 
Entity 2, and receive a few services from eligible clinicians in 
Advanced APM Entity 3. The beneficiary could be included in the 
numerator and denominator for Advanced APM Entity 1 and Advanced APM 
Entity 2 and in the denominator for Advanced APM Entity 3. However, the 
beneficiary could not be counted more than once under the proposed 
exception for determining QP status for individual eligible clinicians 
that do not reach QP status under a single Advanced APM; for this 
exception, each attributed beneficiary would only be counted once in 
the numerator, and the denominator would consist of all unique 
attribution-eligible beneficiaries for whom the eligible clinician 
received payment for covered Medicare professional services for the QP 
Performance Period.
    This is a distinct issue from the question of whether CMS pays 
shared savings to APM Entities more than once for a given beneficiary. 
Such payment overlap issues are handled separately through CMS' 
operational rules governing APM initiative overlaps that address double 
payments, and are not affected by decisions regarding QP Threshold 
Score calculations discussed in this regulation.
    We propose that CMS will not count any beneficiary more than once 
for any single Advanced APM Entity. In other words, for each Advanced 
APM Entity, CMS will count each unique beneficiary no more than one 
time in the numerator and one time in the denominator.
    We believe that counting beneficiaries this way retains integrity 
of the Threshold Scores by preventing double counting of beneficiaries 
within an Advanced APM Entity while recognizing the reality that 
beneficiaries often have relationships with eligible clinicians in 
different organizations. We seek comment on our proposal for counting 
beneficiaries.
(2) Claims Methodology and Adjustments
    To be consistent with the Medicare payment method, we propose that 
beneficiary counts would be based on any beneficiary for whom the 
eligible clinicians within an Advanced APM Entity receive payments for 
Part B covered professional services, even if an Advanced APM bases its 
attribution and/or financial risk on both Parts A and B. We propose 
that for this Threshold Score calculation, we would use any and all 
available Part B claims information generated during the QP Performance 
Period.
(3) Threshold Score Calculation
    We propose that the Threshold Score would be calculated under the 
Medicare patient count method as a percent, by dividing the value 
described under paragraph (a) below by the value described under 
paragraph (b) below. We include the formula and examples in the summary 
equation below.
(a) Numerator
    We propose that the numerator would be the number of unique 
attributed beneficiaries to whom eligible clinicians in the Advanced 
APM Entity furnish Medicare Part B covered professional services during 
the QP Performance Period. For episode payment models, this would 
include the number of attributed beneficiaries furnished Medicare Part 
B covered professional services by eligible clinicians in the Advanced 
APM Entity during the course of an episode under the Advanced APM.
(b) Denominator
    We propose that the denominator would be the number of attribution-
eligible beneficiaries to whom eligible clinicians in the Advanced APM 
Entity furnish covered professional services during the QP Performance 
Period. For episode payment models, this would include the number of 
attribution-eligible beneficiaries furnished Medicare Part B covered 
professional services by eligible clinicians in the Advanced APM Entity 
group at any point during the QP Performance Period, irrespective of 
whether such services occur during the course of an episode.
(c) Summary Equation
    The proposed Medicare patient score method Threshold Score 
calculation can be summarized with the following equations.

Threshold Score = A/B

    For episode payment models, the equation is:

Threshold Score = A/B

Where:

A = The numerator value under paragraph (a) above.
B = The denominator value under paragraph (b) above.

[GRAPHIC] [TIFF OMITTED] TP09MY16.046

    In general, we believe that through consistency with the payment 
amount method this approach balances our interests of relative 
simplicity and having a meaningful standard that recognizes the common 
aspects of attribution and accountability under Advanced APMs. Similar 
to the payment amount method, the patient count method represents a 
proportion of the patients for whom an Advanced APM Entity is 
accountable under the Advanced APM with respect to all patients who 
could potentially be attributed to the Advanced APM Entity under the 
Advanced APM. We believe that it important from any equity perspective 
to not include patients in the denominator if there is no possibility--
based on Advanced APM attribution methodologies--that such individuals 
could be included in the numerator. We note that although we believe 
this method to be a fair assessment of the degree of participation in 
an Advanced APM, our preliminary analyses indicate that many Advanced 
APM Entities would still miss high thresholds set for later years of 
the Quality Payment Program.

[[Page 28326]]

    We seek comment on alternative approaches to the patient count 
method that would achieve our goal of a simple and meaningful Threshold 
Score calculation.
(4) Participation in Multiple Advanced APMs
    We propose that if the same Advanced APM Entity participates in 
multiple Advanced APMs and if at least one of those Advanced APMs is an 
episode payment model, that we would add the number of unique 
beneficiaries in the numerator of the episode payment model Advanced 
APM Entity to the numerator(s) for non-episode payment models in which 
the Advanced APM Entity participates. For example, if an Advanced APM 
Entity is an ACO in Track 3 of the Shared Savings Program and also in 
the OCM, (both of which are hypothetically considered to be Advanced 
APMs for purposes of this example), we would add the entity's unique 
attributed beneficiaries in OCM to the numerator for its Shared Savings 
Program Track 3 Threshold Score calculation. We propose that for 
purposes of this proposal, Advanced APM Entities would be considered 
the same if CMS determines, that the eligible clinician participant 
lists are the same or substantially similar, or if the Advanced APM 
Entity participating in one Advanced APM is the same as, or is a subset 
of, the other.
    The purpose of this proposal is to allow the logical combination of 
activities under multiple Advanced APMs where appropriate. We believe 
that the purpose of the incentives for Advanced APM participation is to 
capture the degree of Advanced APM participation generally, not simply 
the degree of participation within a single Advanced APM. Where 
relevant and operationally feasible, we want this program to encourage 
participation in multiple Advanced APMs. The counterfactual where we 
would not account for a single Advanced APM Entity's participation in 
multiple Advanced APMs could be seen as punitive. For instance, an 
Advanced APM Entity could serve the vast majority of its beneficiaries 
through several Advanced APMs, but unless that participation is 
aggregated, the entity could end up with several lower Threshold Scores 
that are below the QP Patient Count Threshold and not indicative of its 
broader participation.
    We understand the difficulty associated with determining whether 
two Advanced APM Entities are in fact the same organization. It is 
highly unlikely that their participant lists will be exactly the same. 
Therefore, we seek comment on how best to make a determination of 
substantial similarity, which includes, for example, matching 
organizational information, aligning TINs, and comparing participant 
lists. We also seek comment on percentages of participant list or TIN 
similarity that would be sufficient for APM Entities to be considered 
under this policy.
d. Use of Methods
    CMS may apply one or both of two different methods--using payment 
amounts or patient counts--to arrive at an eligible clinician's 
Threshold Score. CMS will compare the Threshold Score against the 
relevant QP Threshold or Partial QP Threshold to determine an eligible 
clinician's QP status for the year.
    We propose that CMS would calculate Threshold Scores for eligible 
clinicians in an Advanced APM Entity under both the payment amount and 
patient count methods for each QP Performance Period. We also propose 
that CMS would assign QP status using the more advantageous of the 
Advanced APM Entity's two scores.
    We believe that both the payment amount and patient count methods 
should be considered in order to produce Threshold Scores. As the two 
calculations differ there may be cases in which Threshold Scores vary 
enough that different QP determinations could result depending on which 
is used. In such an event, we do not believe that prioritizing the 
Threshold Score using one calculation over the other would yield an 
appropriate, non-arbitrary result. By using the greater of the 
Threshold Scores achieved, we hope to promote simplicity in QP 
determinations and to maximize the number of eligible clinicians that 
attain QP status each year. We seek comment on the use of the payment 
and patient count methods for the Medicare Option.
e. Services Furnished Through CAHs, FQHCs, and RHCs
(1) Critical Access Hospitals (CAHs)
    We propose that professional services billed by CAHs under section 
1834(g)(2)(B) of the Act (Method II CAH professional services) would 
count towards the QP determination threshold calculations for both the 
Medicare payment and patient count methods in both the numerator and 
the denominator, as applicable. We believe these services would 
constitute ``covered professional services'' under section 1848(k)(3) 
of the Act because they are furnished by an eligible clinician and 
payment is based on the Medicare PFS. This policy is consistent with 
our treatment of payments for Method II CAH professional services for 
purposes of the EHR Incentive Program and PQRS adjustments under 
sections 1848(a)(7) and (8) of the Act, respectively. Under section 
1848(a)(7) and (8) of the Act, the PQRS and EHR Incentive Program 
adjustments are applied to payments for covered professional services 
furnished by an eligible clinician in a Method II CAH.
    CAHs were established under the Balanced Budget Act (BBA) of 1997 
as a separate provider type with a distinct set of Medicare Conditions 
of Participation and their own payment methodology. CAHs are not 
subject to the Medicare Inpatient Prospective Payment System (IPPS) or 
the Medicare Outpatient Prospective Payment System (OPPS). Instead, 
CAHs are generally paid based on 101 percent of reasonable costs for 
inpatient services and are paid for outpatient services under one of 
two methods: The Standard Payment method outlined in section 1834(g)(1) 
of the Act (Method I), or the Optional Payment Method outlined in 
section 1834(g)(2) of the Act (Method II). A CAH is paid under Method I 
unless it elects to be paid under Method II.
    Under Method I, for cost reporting periods beginning on or after 
January 1, 2004, payments to CAHs are made for outpatient CAH facility 
services at 101 percent of reasonable costs. Physicians and 
practitioners receive payment for professional services under the 
Medicare PFS. A CAH may elect Method II billing, under which the CAH 
bills Medicare for both facility services and professional services 
furnished to its outpatients by a physician or practitioner who has 
reassigned his or her billing rights to the CAH. Even if a CAH makes 
this election, each physician or practitioner who furnishes 
professional services to CAH outpatients can choose to either: (1) 
Reassign his or her billing rights to the CAH, agree to be included 
under the Method II billing, attest in writing that he or she will not 
bill Medicare for professional services furnished in the CAH outpatient 
department, and receive payment from the CAH for the professional 
services; or (2) elect to file claims for his or her professional 
services with Medicare for standard payment under the Medicare PFS.
    As of January 1, 2004, payment for a physician's professional 
services provided at a CAH billing under Method II is 115 percent of 
the allowable amount, after applicable deductions, under the Medicare 
PFS. For a non-physician practitioner's professional services, the 
payment amount is 115 percent of the amount that otherwise

[[Page 28327]]

would be paid for the practitioner's professional services, after 
applicable deductions, under the Medicare PFS.
(2) Rural Health Clinics (RHCs) and Federally Qualified Health Centers 
(FQHCs)
    RHCs and FQHCs are facilities that furnish services that are 
typically furnished in an outpatient clinic setting. They are located 
in areas that have been designated as HPSAs, and meet other 
requirements.
    Under section 1833(a)(3) of the Act, RHCs are paid an all-inclusive 
rate (AIR) based on reasonable costs, subject under section 1833(f) of 
the Act to a maximum payment per visit that is established by Congress 
and updated annually based on the percentage change in the Medicare 
Economic Index (MEI) and subject to annual reconciliation. The per-
visit limit does not apply to RHCs determined to be an integral and 
subordinate part of a hospital with fewer than 50 beds. Laboratory 
tests (excluding venipuncture) and technical components of RHC services 
are paid separately. The RHC payment limit per visit for CY 2016 is 
$81.32, effective January 1, 2016, through December 31, 2016.
    The FQHC Medicare benefit was added when section 1861(aa) of the 
Act was amended by section 4161 of the Omnibus Budget Reconciliation 
Act of 1990. FQHCs are paid according to the FQHC PPS set out under 
section 1834(o) of the Act, in which Medicare pays a national encounter 
based rate per beneficiary per day, with some adjustments based on 
where and by whom the services are furnished. The unadjusted 2016 PPS 
rate is $160.60.
    We propose that professional services furnished at RHCs and FQHCs 
that participate in ACOs, and are reimbursed under the RHC AIR or FQHC 
PPS (respectively), be counted towards the QP determination 
calculations under the patient count method but not under the payment 
amount method.
    In certain Medicare ACO APMs, RHC and FQHC services can be counted 
for purposes of attributing beneficiaries to an ACO. Therefore, we 
propose to include beneficiaries attributed to an Advanced APM Entity 
in full or in part because of services furnished by RHCs or FQHCs in 
the patient counts used for QP determination calculations.
    As previously stated, section 1833(z)(2)(D) of the Act permits us 
to use patient counts in lieu of payments when determining whether an 
eligible clinician is a QP ``as the Secretary determines appropriate.'' 
Our proposal to include the professional services furnished by eligible 
clinicians at RHCs and FQHCs in the QP threshold calculations for the 
patient count method is essential to assure consistency with this 
program and existing APM attribution methodologies. An Advanced APM 
Entity is responsible for the cost and quality of care for all 
beneficiaries attributed to an APM Entity, including all professional 
services furnished to such beneficiaries, regardless of whether or not 
attribution was based on services furnished by an eligible clinician or 
by an RHC or FQHC. We believe such beneficiaries are clearly served 
through the Advanced APM Entity, and it would be potentially confusing 
to eligible clinicians and Advanced APM Entities to track this 
distinction strictly for purposes of QP determination. We also believe 
that it would be unduly burdensome and impractical for CMS to develop 
and maintain a separate list of beneficiaries aligned to each Advanced 
APM Entity from the full list of beneficiaries for whom an Advanced APM 
Entity is responsible under an Advanced APM.
    Because professional services furnished by eligible clinicians at 
RHCs and FQHCs are not reimbursed under, or based on, the Medicare PFS, 
professional services furnished in these settings do not constitute 
``covered professional services'' under section 1848(k)(3)(A) of the 
Act. In the Medicare Payment Amount Method, where payments for 
specified covered professional services are summed, only payments for 
covered professional services can be included.
    We believe that our proposal will continue to encourage the 
development of APMs that span rural and/or underserved areas. We seek 
comment on this proposal.
7. Combination All-Payer and Medicare Payment Threshold Option
a. Overview
    Beginning in 2021, in addition to the Medicare Option, eligible 
clinicians may also become QPs through the All-Payer Combination 
Option, described under section 1833(z)(2)(B)(ii) and (C)(ii) of the 
Act as the Combination All-Payer and Medicare Payment Threshold Option. 
Thus, there will be two avenues for eligible clinicians to become QPs--
the Medicare Option and the All-Payer Combination Option--and an 
eligible clinician need only meet the QP threshold under one of them to 
be a QP for the payment year. The All-Payer Combination Option provides 
an incentive for eligible clinicians to participate in arrangements 
with non-Medicare payers that have payment designs similar to those in 
Advanced APMs. The All-Payer Combination Option uses both the methods 
described in the Medicare Option and methods that calculate payments 
for all services from all payers, with certain exceptions, that are 
attributable to participation in both Advanced APMs and Other Payer 
Advanced APMs.
    Although the statutory QP threshold for an eligible clinician to be 
a QP (the QP Payment Amount Threshold) under the Medicare Option 
increases from 25 percent in 2019 and 2020 under section 1833(z)(2)(A) 
of the Act, to 50 percent in 2021 and 2022 under section 
1833(z)(2)(B)(i) of the Act, to 75 percent beginning in 2023 under 
section 1833(z)(2)(C)(i) of the Act, the All-Payer Combination Option 
allows eligible clinicians with lower levels of participation in 
Advanced APMs to become QPs through sufficient participation in Other 
Payer Advanced APMs with payers such as State Medicaid programs and 
commercial payers, including Medicare Advantage plans. Similar to 
Medicare payment amount and patient count methods the statute also 
allows, under section 1833(z)(2)(D) of the Act, the QP determination to 
be based on payment amount or on counts of patients in lieu of payments 
using the same or similar percentage criteria. These QP thresholds are 
presented in Tables 38 and 39, and the process is shown in Figures J 
and K. The process shown in H and I will be similar for the patient 
count threshold, although only the process for the payment amount 
threshold is displayed. CMS may reassess the QP Patient Count 
Thresholds in future years based on the experience gained from eligible 
clinician Threshold Scores during the first years of operations. In 
summary, eligible clinicians may become QPs if the following steps 
occur as described below in the associated sections: (1) The eligible 
clinician submits to CMS sufficient information on all relevant payment 
arrangements with other payers; (2) CMS determines that an Other Payer 
APM is an Other Payer Advanced APM; (3) the eligible clinician meets 
the relevant QP thresholds by having sufficient payments or patients 
attributed to a combination of participation in Advanced APMs and Other 
Payer Advanced APMs.

[[Page 28328]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.047


[[Page 28329]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.048

    Sections 1833(z)(2)(B)(ii) and (C)(ii) of the Act describe the 
payment amount method for making the QP determination under the All-
Payer Combination Option. For purposes of making a QP determination 
under this

[[Page 28330]]

option, a QP is an eligible clinician for whom we determine with 
respect to items and services furnished by such professional during the 
most recent period for which data are available (which may be less than 
a year) that, at least the specified percent of the sum of combined 
Medicare payments and all other payments regardless of payer are 
through Advanced APMs and Other Payer Advanced APMs that meet the 
criteria set forth in this section.
b. Other Payer Advanced APM Criteria
(1) In General
    A payment arrangement with a non-Medicare payer (Other Payer APM) 
can become an Other Payer Advanced APM if the arrangement meets three 
criteria:
     Certified Electronic Health Record technology (CEHRT) is 
used;
     Quality measures comparable to measures under the MIPS 
quality performance category apply; and
     The APM Entity either: (1) Bears more than nominal 
financial risk if actual aggregate expenditures exceed expected 
aggregate expenditures; or (2) for beneficiaries under title XIX, is a 
medical home in a Medicaid Medical Home Model that meets criteria 
comparable to Medical Home Models expanded under section 1115A(c) of 
the Act.
    Other Payer APMs include payment arrangements under any payer other 
than traditional Medicare. Medicare Advantage and other Medicare-funded 
private plans are categorized as a payer other than traditional 
Medicare for these purposes. In this section, we explain how the three 
criteria are applied to determine whether arrangements are Other Payer 
Advanced APMs.
(2) Medicaid APMs
    We propose to define a Medicaid APM as a payment arrangement under 
title XIX that meets the criteria to be an Other Payer Advanced APM as 
proposed in this section. States can choose from different authorities 
in title XIX when implementing new payment models. We believe this 
proposal would provide some flexibility for States but align the core 
requirements for Medicaid APMs with the broader Advanced APM and Other 
Payer Advanced APM criteria. Otherwise, we intend to generally defer to 
states in their design of payment arrangements.
(3) Medicaid Medical Home Models
    We propose that a Medicaid Medical Home Model is a Medical Home 
Model that is operated under a State title XIX program instead of under 
section 1115A of the Act. Section 1833(z) of the Act mentions medical 
homes and what we have termed Medicaid Medical Homes (those with 
respect to beneficiaries under title XIX) several times, but does not 
define the terms. In addition, Medicaid Medical Home is not defined in 
title XIX or in Medicaid laws or regulations. Therefore, we need to 
define the terms because of their importance in the Quality Payment 
Program.
    We propose that a Medicaid Medical Home Model must have the 
following elements at a minimum:
     Model participants include primary care practices or 
multispecialty practices that include primary care physician and 
practitioners and offer primary care services, and
     Empanelment of each patient to a primary clinician.
    In addition to these elements, we propose that a Medicaid Medical 
Home Model must have at least four of the following elements:
     Planned chronic and preventive care.
     Patient access and continuity.
     Risk-stratified care management.
     Coordination of care across the medical neighborhood.
     Patient and caregiver engagement.
     Shared decision-making.
     Payment arrangements in addition to, or substituting for, 
fee-for-service payments (for example, shared savings, population-based 
payments).
    This definition of Medicaid Medical Home Model applies only for the 
purposes of the Quality Payment Program, and could be defined 
differently for other purposes. To define these terms, we reviewed 
existing and past Medical Home Models CMS developed under section 1115A 
of the Act, including the Comprehensive Primary Care Initiative (CPC). 
In addition, we reviewed a variety of other sources including several 
from the National Committee for Quality Assurance, the Joint Principles 
of the Patient-Centered Medical Home (a joint statement by the American 
Academy of Family Physicians, the American Academy of Pediatrics, the 
American College of Physicians, and the American Osteopathic 
Association), and the Agency for Healthcare Research and Quality. Our 
proposed definition of Medicaid Medical Home Model uses common elements 
from these sources. We believe that using a common set of elements 
ensures general comparability between Medical Home Models and Medicaid 
Medical Home Models while maintaining flexibility for the States under 
title XIX. In response to the MIPS and APMs RFI, some commenters 
suggested that we should require a specific method or accreditation 
process for recognizing Medicaid Medical Home Models, while others 
asked us not to use such an approach. We will not mandate a specific 
method or accreditation process. We believe that such a policy would 
provide limited additional benefit while unnecessarily restricting 
state innovation. However, we believe it likely that accredited models, 
such as those certified by the National Committee on Quality Assurance 
may also meet these proposed criteria. Medicaid Medical Home Models can 
be Other Payer Advanced APMs if they meet the criteria set forth in 
this section.
    We seek comment on the definitions of Medicaid APMs and Medicaid 
Medical Homes Models.
(4) Use of Certified Electronic Health Record Technology
    To be an Other Payer Advanced APM, as described under section 
1833(z)(2)(B)(iii)(II)(bb) and (z)(2)(C)(iii)(II)(bb) of the Act, 
payments must be made under arrangements in which certified EHR 
technology is used. This is slightly different than the requirement for 
Advanced APMs that ``requires participants in such model to use 
certified EHR technology (as defined in section 1848(o)(4) of the 
Act),'' as specified in section 1833(z)(3)(D)(i)(I) of the Act. 
Although the statutory requirements are phrased slightly differently, 
we believe that there is value in keeping the two standards--for 
Advanced APMs and Other Payer Advanced APMs--as similar as possible.
    We propose that Other Payer APMs would meet this Other Payer 
Advanced APM criterion under sections 1833(z)(2)(B)(iii)(II)(bb) and 
(z)(2)(C)(iii)(II)(bb) of the Act by requiring participants to use 
CEHRT as defined for MIPS and APMs under Sec.  414.1305. This approach 
is consistent with the approach for Advanced APMs as described in 
section II.F.4.b.(1) of this preamble. In the 2015 EHR Incentive 
Programs final rule (80 FR 62872 through 62873), we established the 
definition of CEHRT for EHR technology that must be used by eligible 
clinicians to meet the meaningful use objectives and measures in 
specific years. In this proposed rule, we are proposing to adopt the 
specifications from within the current definition of CEHRT in our 
regulation at Sec.  414.1305 for eligible clinicians participating in 
MIPS or in APMs. This definition is identical to the definition for use 
by eligible hospitals and CAHs and Medicaid eligible clinicians in the 
EHR Incentive Programs.
    In accordance with section 1833(z)(2)(C)(iii)(II) of the Act, we

[[Page 28331]]

propose that an Other Payer Advanced APM must require at least 75 
percent of eligible clinicians in each participating APM Entity (or 
each hospital if hospitals are the APM participants) to use the 
certified health IT functions outlined in the proposed definition of 
CEHRT to document and communicate clinical care with patients and other 
health care professionals.
    We seek comment on the proposed definition of CEHRT for Advanced 
APMs and Other Payer Advanced APMs and whether they should be the same 
for both. We seek comment on the proposed method for Other Payer APMs 
to meet the CEHRT use criterion.
(5) Application of Quality Measures Comparable to Those Under the MIPS 
Quality Performance Category
    Another of the criteria to be considered an Other Payer Advanced 
APM, as described in sections 1833(z)(2)(B)(ii)(II)(aa) and 
(C)(iii)(II)(aa) of the Act, are quality measures comparable to those 
under MIPS quality performance category apply under the Other Payer 
APM. Under the MACRA and in this proposal, not all quality measures in 
an APM are required to be ``comparable'' and not all payments under the 
APM must be based on comparable measures. This approach is similar to 
the requirement for Advanced APMs as described in section II.F.4.b.(2) 
of this preamble. Under this proposal, Other Payer APMs retain 
sufficient freedom to innovate in paying for services and measuring 
quality. For instance, an Other Payer APM may have incentive payments 
related to quality, total cost of care, participation in learning 
activities, and adoption of health IT. The existence of all of the 
payments associated with non-quality aspects does not preclude the 
Other Payer APM from meeting this Other Payer Advanced APM criterion. 
In other words, this criterion only sets standards for payments tied to 
quality measurement, not other methods of payment. Conversely, an Other 
Payer APM may test new quality measures that do not fall into the MIPS-
comparable standard. So long as the Other Payer APM meets the 
requirements set forth in this criterion, there is no additional 
prescription for how the Other Payer APM tests additional measures that 
may or may not meet the standards under this criterion. Therefore, we 
propose that the quality measures on which the Other Payer Advanced APM 
bases payment must include at least one of the following types of 
measures provided that they have an evidence-based focus and are 
reliable and valid as described in section II.F.4.b.(2) of this 
preamble:
    (1) Any of the quality measures included on the proposed annual 
list of MIPS quality measures;
    (2) Quality measures that are endorsed by a consensus-based entity;
    (3) Quality measures developed under section 1848(s) of the Act;
    (4) Quality measures submitted in response to the MIPS Call for 
Quality Measures under section 1848(q)(2)(D)(ii) of the Act; or
    (5) Any other quality measures that CMS determines to have an 
evidence-based focus and are reliable and valid.
    We want to encourage the use of outcome measures for quality 
performance assessment in Other Payer APMs. As we did for APMs in 
section II.F.4.b.(2) of this preamble, we propose that in addition to 
the general comparable quality measure requirement proposed in this 
section, an Other Payer Advanced APM must include at least one outcome 
measure if an appropriate measure (that is, the measure addresses the 
specific patient population and is specified for the APM participant 
setting) is available on the MIPS list of measures for that specific QP 
Performance Period.
    We believe that this framework will provide other payers the 
flexibility needed to ensure that their quality performance metrics 
meet their unique goals. We seek comment on this proposed criterion.
(6) Financial Risk for Monetary Losses
    As described in sections 1833(z)(2)(B)(iii)(II)(cc) and 
(C)(iii)(II)(cc) of the Act, the third criterion that an Other Payer 
APM must meet to be an Other Payer Advanced APM is that under the 
arrangement, the APM Entity must either bear more than nominal 
financial risk if actual aggregate expenditures exceed expected 
aggregate expenditures or the Other Payer APM be a Medicaid Medical 
Home Model that meets criteria comparable to Medical Home Models 
expanded under section 1115A(c) of the Act, as described in paragraph 
(d) below.
    The financial risk standard under this criterion is similar to that 
proposed for the Advanced APM criterion. For purposes of determining 
whether the Other Payer APM is an Other Payer Advanced APM, this 
proposal does not impose any additional performance criteria, such as 
actual achievement of savings, on APM Entities in other payer 
arrangements. As with all the proposed Advanced APM criteria, this 
requirement pertains to the payment arrangement structure, not of the 
performance of the participants within the payment arrangement.
    This section is broken into two main parts: (1) What it means for 
an Advanced APM Entity to bear financial risk if actual aggregate 
expenditures exceed expected aggregate expenditures under an Other 
Payer Advanced APM; and (2) what amounts of risk are considered to be 
more than nominal.
    We prioritized keeping the standards consistent across different 
types of APMs, including Advanced APMs as described in section 
II.F.4.b.(3) of this preamble.
(a) Bearing Financial Risk for Monetary Losses
    We propose a generally applicable standard for Other Payer Advanced 
APMs and a slightly different standard for Medicaid Medical Home 
Models. We want to be consistent with and comparable to the Advanced 
APM financial risk standard within the limits of the statutory text.
(i) Generally Applicable Other Payer Advanced APM Standard
    We propose that the generally applicable financial risk standard 
for Other Payer Advanced APMs would be that a payment arrangement must, 
if APM Entity actual aggregate expenditures exceed expected aggregate 
expenditures during a specified performance period:
     Withhold payment for services to the APM Entity and/or the 
APM Entity's eligible clinicians;
     Reduce payment rates to the APM Entity and/or the APM 
Entity's eligible clinicians; or
     Require direct payments by the APM Entity to the payer.
    We believe this financial risk criterion best distinguishes most 
Other Payer APMs from those that are focused on challenging physicians 
and practitioners to assume risk and provide high value care. We expect 
that an increasing proportion Other Payer APMs will meet that bar over 
time. This proposal is based on the statutory requirement that the APM 
Entity bear risk if aggregate actual expenditures exceed aggregate 
expected expenditures under the model, and is consistent with our 
proposal for the corresponding criterion proposed for Advanced APMs. 
Through the MIPS and APM RFI, many stakeholders commented that business 
risk should be sufficient to meet this Advanced APM criterion. We do 
not intend for our proposal to minimize the substantial time and 
financial commitments that APM Entities invest to become successful APM 
participants. We note that there is also difficulty in creating an

[[Page 28332]]

objective and enforceable standard for determining whether an entity's 
business risk exceeds a nominal amount, and that the statutory 
framework for the APM Incentive Payment recognizes that not all 
alternative payment arrangements will meet the criteria to be 
considered for purposes of the QP determination. We seek comments 
regarding the proposed standard and whether there are other types of 
arrangements that should be incorporated into the standard.
(ii) Medicaid Medical Home Model Financial Risk Standard
    We propose that for a Medicaid Medical Home Model to be an Other 
Payer Advanced APM if the APM Entity's actual aggregate expenditures 
exceed expected aggregate expenditures, the APM must:
     Withhold payment for services to the APM Entity and/or the 
APM Entity's eligible clinicians;
     Reduce payment rates to the APM Entity and/or the APM 
Entity's eligible clinicians;
     Require direct payment by the APM Entity to the payer; or
     Require the APM Entity to lose the right to all or part of 
an otherwise guaranteed payment or payments.
    For instance, a Medicaid Medical Home Model would meet our proposed 
financial risk criterion if it conditions the payment of some or all of 
a regular care management fee to medical home APM Entities upon 
expenditure performance in relation to a benchmark. Because the 
arrangement would require no direct payment as a consequence for 
failure to meet expenditure standards, such a medical home would not 
necessarily be worse off than it had been prior to the decreased 
payment. However, it would be worse off in the future than it otherwise 
would have been had it met expenditure standards. Similarly, a Medicaid 
Medical Home Model that offers expenditure and quality performance 
payments in addition to payment withholds that can be earned back for 
meeting minimum requirements would also meet this criterion. Consistent 
with the treatment of Medical Home Models under the statute, this 
proposal acknowledges the unique challenges of medical homes in bearing 
risk for losses while maintaining a more rigorous standard than mere 
business risk.
    We believe that because Medicaid Medical Home Models are unique 
types of Medicaid APMs and because they are identified and treated 
differently by the statute under the Quality Payment Program, it is 
appropriate to establish a unique standard for bearing financial risk 
that reflects these differences and remains consistent with the 
statutory scheme, which is to provide incentives for participation by 
eligible clinicians in advanced APMs.
    Similar to Medical Home Model standards for Advanced APMs in 
II.F.4.b.(3), we believe that it would be appropriate to impose size 
and composition limits for Medicaid Medical Home Models to ensure that 
the focus is on organizations with a limited capacity for bearing the 
same magnitude of financial risk as larger APM Entities do. We propose 
that this limit would only apply to APM Entities that participate in 
Medicaid Medical Home Models and that have 50 or fewer eligible 
clinicians in the organization through which the APM Entity is owned 
and operated. Thus, in a Medicaid Medical Home Model that is an Other-
Payer Advanced APM, only those APM Entities that are part of a parent 
organization with 50 or fewer eligible clinicians would be Advanced APM 
Entities. We believe it is appropriate to use eligible clinicians, 
rather than physicians, when setting this threshold as the number of 
eligible clinicians both reflects organizational resources and capacity 
and also may differ substantially across organizations with the same 
number of physicians.
    We also believe that this size threshold of 50 eligible clinicians 
is appropriate as organizations of that size have demonstrated the 
capacity and interest in taking on risk, and organizations may also 
join together to take on risk collectively, for example, in an ACO. In 
the event that a Medicaid Medical Home Model happens to have criteria 
that meet the Advanced APM financial risk criterion that is generally 
applicable to all Other Payer APMs, this organizational size limitation 
would be moot.
    There are several unique aspects of Medicaid Medical Home Models, 
which statute specifically singles out for unique treatment, and their 
participating APM Entities (medical homes) that support the need for a 
separate standard to assess financial risk if actual expenditures 
exceed expected expenditures. Medical homes are generally more limited 
in their ability to bear financial risk than other Entities because 
they tend to be smaller and predominantly include primary care 
practitioners, whose revenues are a smaller fraction of the 
beneficiaries' total cost of care than those of other eligible 
clinicians. Moreover, Medicaid medical homes serve low income 
populations and those with significant health disparities; due to the 
method of payment for care for these populations, Medicaid medical home 
practices often have relatively low revenues. Lastly, Medicaid Medical 
Home Models to date have not required participants to bear substantial 
downside risk, and including such a requirement under this program 
would create a significant challenge for medical homes to serve their 
patients.
    We seek comment on the proposed financial risk standard set forth 
for Medicaid Medical Home Models and on alternative standards that 
would be consistent with the statute and could achieve our stated 
goals. We also seek comment on types of financial risk arrangements 
that may not be clearly captured in this proposal.
(b) Nominal Amount of Risk
    When an Other Payer APM risk arrangement meets the proposed 
financial risk standard, we would then consider whether the risk is of 
a more than nominal amount such that it meets this nominal risk 
standard. Similar to the financial risk portion of this assessment, we 
propose to adopt a generally applicable nominal amount standard for 
Other Payer Advanced APMs and a unique nominal amount standard for 
Medicaid Medical Home Models.
    We propose to measure three dimensions of risk to determine whether 
a model meets the nominal amount standard: (a) Marginal risk, which is 
a common component of risk arrangements--particularly those that 
involve shared savings--that refers to the percentage of the amount by 
which actual expenditures exceed expected expenditures for which an APM 
Entity would be liable under an Other Payer APM; (b) minimum loss rate 
(MLR), which is a percentage by which actual expenditures may exceed 
expected expenditures without triggering financial risk; and (c) total 
potential risk, which refers to the maximum potential payment for which 
an APM Entity could be liable under an Other Payer APM. An example of 
marginal risk within an Other Payer APM could be set up in a manner 
similar to the Shared Savings Program, where an ACO that has a sharing 
rate, or marginal rate, of 50 percent and exceeds its benchmark 
(expected expenditures) by $1 million would be liable for $500,000 of 
those losses. The marginal risk could also vary with the amount of 
losses.
    When assessing whether an Other Payer APM meets the marginal and 
total risk portions of the nominal risk standard, we would use the same 
approach we proposed to use with respect to APMs. Specifically, to 
determine whether an Other Payer APM

[[Page 28333]]

satisfies the total risk portion of the nominal risk standard, we would 
identify the maximum potential payment an APM Entity could be required 
to make as a percentage of the expected expenditures under the Other 
Payer APM. If that percentage exceeded the required total risk 
percentage, then the arrangement would satisfy the total risk portion 
of the nominal risk standard.
    To determine whether an Other Payer APM satisfies the marginal risk 
portion of the nominal risk standard, we would examine the payment 
required under the Other Payer APM as a percentage of the amount by 
which actual expenditures exceeded expected expenditures. We propose 
that we would require that this percentage exceed the required marginal 
risk percentage regardless of the amount by which actual expenditures 
exceeded expected expenditures, with two exceptions.
    First, we propose a maximum allowable ``minimum loss rate'' (MLR) 
of 4 percent in which the payment required by the Other Payer APM could 
be smaller than the nominal amount standard would otherwise require 
when actual expenditures exceed expected expenditures by less than 4 
percent; this exception accommodates Other Payer APMs that include zero 
risk with respect to small losses but otherwise satisfy the marginal 
risk standard. We also propose a process through which CMS could 
determine that a risk arrangement with an MLR higher than 4 percent 
could meet the nominal amount standard, provided that the other 
portions of the nominal risk standard are met. In determining whether 
such an exception would be appropriate, CMS would consider: (1) Whether 
the size of the attributed patient population is small; (2) whether the 
relative magnitude of expenditures assessed under the Other Payer APM 
is particularly small; and (3) in the case of test of limited size and 
scope, whether the difference between actual expenditures and expected 
expenditures would not be statistically significant even when actual 
expenditures are 4 percent above expected expenditures. We note that 
CMS would grant such exceptions rarely, and CMS would expect APMs 
considered for such exceptions to demonstrate that a sufficient number 
of APM Entities are likely to incur losses in excess of the higher MLR. 
In other words, the potential for financial losses based on 
statistically significant expenditures in excess of the benchmark 
remains meaningful for participants.
    Second, we propose that the payment required by the Other Payer APM 
could be smaller when actual expenditures exceed expected expenditures 
by enough to trigger a payment greater than or equal to the total risk 
amount required under the nominal amount standard (as specified in 
Table 40). This exception ensures that the marginal risk requirement 
does not effectively require Other Payer APMs to incorporate total risk 
greater than the amount required by the total risk portion of the 
standard in order to become Other Payer Advanced APMs.
    In evaluating both the total and marginal risk portions of the 
nominal amount standard, we would not include any payments the APM 
Entity or its participating providers would make to the other payer if 
actual expenditures exactly matched expected expenditures. In other 
words, payments made to the other payer outside the risk arrangement 
related to expenditures would not count toward the nominal risk 
standard. This requirement ensures that perfunctory or pre-determined 
payments do not supersede incentives for improving efficiency. For 
example, an Other Payer APM that simply requires an APM Entity to make 
a payment equal to 5 percent of the Other Payer APM benchmark at the 
end of the year, regardless of actual expenditure performance, would 
not satisfy the nominal amount standard.
    Finally, like the Advanced APM criterion described in section 
II.F.4.b.(4) of this preamble, the amounts described in this section 
need not take a shared savings structure in which financial risk 
increases smoothly based on the amount by which an Other Payer Advanced 
APM Entity's actual expenditures exceed expected expenditures. The risk 
arrangement must be tied to expenditures, but the amount of that risk 
does not have to be directly proportional to expenditures. For 
instance, an APM Entity could be required to pay the payer a flat 
amount or an amount tied to the number of attributed beneficiaries in 
the case of exceeding an expenditure benchmark, provided that these 
amounts are otherwise structured in a way that satisfies the nominal 
amount standard.
(i) Generally Applicable Other Payer Advanced APM Nominal Amount 
Standard
    Except for risk arrangements described under the Medicaid Medical 
Home Standard in paragraph (ii) below, we propose that for an Other 
Payer APM to meet the nominal amount standard the specific level of 
marginal risk must be at least 30 percent of losses in excess of the 
expected expenditures and total potential risk must be at least four 
percent of the expected expenditures.
    Other Payer APM arrangements with less than 30 percent marginal 
risk would not meet the nominal amount standard. We believe that 
meaningful risk arrangements can be designed with marginal risk rates 
of greater than 30 percent. Any marginal risk below 30 percent creates 
scenarios in which the total risk could be very high, but the average 
or likely risk for an Other Payer APM Entity would actually be very 
low.
    Table 40 summarizes the generally applicable nominal amount 
standard.
[GRAPHIC] [TIFF OMITTED] TP09MY16.049

    In establishing the proposed criteria for Other Payer Advanced 
APMs, we are keeping the approach to nominal risk as consistent as 
possible with the approach for the proposed Advanced APM criteria as 
described in section II.F.4.b.(4) of this preamble. The statute 
specifies that the Other Payer Advanced APM Entity must bear more than 
nominal financial risk if actual aggregate expenditures exceed expected 
aggregate expenditures. We believe it is important, to the extent 
possible and consistent with the statute, to adopt consistent financial 
risk standards with the Advanced APM

[[Page 28334]]

standard as described in section II.F.4.b.(3) in this preamble, so that 
eligible clinicians can base their decisions on participation in these 
Other Payer APMs on a consistent set of criteria. The Advanced APM 
financial risk section of this preamble, II.F.4.b.(3) describes the 
process by which we arrived at the proposed values.
    For Medicaid APMs we propose the same standard as for Other Payer 
APMs. However, we recognize that Medicaid practitioners may be less 
able to bear substantial financial risk because they are generally 
reimbursed at lower payment rates, and they serve low-income 
populations and those with significant health disparities. Therefore, 
we seek comment and supporting evidence on whether the proposal offered 
identifies the appropriate amounts of nominal risk for Medicaid APMs.
(ii) Medicaid Medical Home Model Nominal Amount Standard
    For Medicaid Medical Home Models, we propose that the minimum total 
annual amount that an APM Entity must potentially owe or forego to be 
considered an Other Payer Advanced APM must be at least:
     In 2019, 4 percent of the APM Entity's total revenue under 
the payer.
     In 2020 and later, 5 percent of the APM Entity's total 
revenue under the payer.
    We believe that because few Medicaid Medical Homes have experience 
with financial risk, and because they tend to be smaller in size than 
other APM Entities, we should not include a potentially excessive 
nominal amount for such entities in the first year of the program. We 
have also taken into account that the MACRA explicitly highlights 
Medical Home Models, generally, for special treatment under the Quality 
Payment Program. We have less information on Medicaid Medical Home 
Models and their performance to date compared to our information on 
Medical Home Models. Medicaid Medical Home Models are still developing, 
and we believe the introduction of a nominal amount standard that is 
not currently widely represented in the marketplace should be 
approached in a measured manner. We therefore believe that the unique 
characteristics of Medicaid Medical Home Models warrant the application 
of a nominal amount standard that reflects these differences, and 
statute provides us with the flexibility to make such a distinction.
    We seek comment on all of the proposed nominal amount standards. We 
also seek comment on the potential inclusion of a marginal risk amount 
in the standard and the extent to which it is applicable.
(c) Capitation
    We propose that full capitation risk arrangements would meet this 
Other Payer Advanced APM financial risk criterion. We propose that for 
purposes of this rulemaking, a capitation risk arrangement means a 
payment arrangement in which a per capita or otherwise predetermined 
payment is made to an APM Entity for services furnished to a population 
of beneficiaries, and no settlement is performed for the purpose of 
reconciling or sharing losses incurred or savings earned by the APM 
Entity. Our rationale for this policy is the same as the rationale on 
capitation for Advanced APMs described in section II.F.4.b.(3) of this 
preamble. As such, we reiterate that capitation should not simply be a 
cash flow mechanism. We also reiterate that capitation arrangements 
qualifying under the financial risk standard must be structured to 
directly hold the provider--or the entity to which the provider has 
assigned their billing--accountable.
    We seek comment on our proposal for categorical definition of Other 
Payer APM capitation risk arrangements as meeting the financial risk 
criterion for Other Payer Advanced APMs, and on our proposed definition 
of a capitation risk arrangement. We also seek comment on other types 
of arrangements that may be suitable for such treatment for purposes of 
this financial risk criterion.
(d) Criteria Comparable to Expanded Medical Home Model
    In accordance with sections 1833(z)(2)(B)(iii)(II)(cc)(BB) and 
(C)(iii)(II)(cc)(BB) of the Act, we propose that Medicaid Medical Home 
Models that meet criteria comparable to a Medical Home Model expanded 
under section 1115A(c) of the Act would meet the Other Payer Advanced 
APM financial risk criterion. We propose that CMS will specify in 
subsequent rulemaking the criteria of any Medical Home Model that is 
expanded under section 1115A(c) of the Act that will be used for 
purposes of making this comparability assessment. We believe that the 
expanded Medical Home Model criteria can only be used for comparison 
when a Medical Home Model is, in fact, expanded as described in section 
II.F.4.b.(6) of this preamble, not merely by satisfying the expansion 
criteria under section 1115A(c) of the Act. If no such Medical Home 
Model has actually been expanded under section 1115A(c) of the Act, we 
would not have any criteria for comparison. In the absence of any 
expanded Medical Home Model to which we could draw comparisons, 
Medicaid Medical Home Models must meet the financial risk criterion 
through the other provisions (the financial risk and nominal amount 
standards) in order to be an Other Payer Advanced APM. We seek comment 
on how to determine the criteria of an expanded Medical Home Model that 
could be used for comparison, and on how similar the Medicaid Medical 
Home Model criteria must be to the expanded Medical Home Model criteria 
in order to be considered ``comparable.''
(7) Medicare Advantage (MA)
    We received multiple comments on the MIPS and APMs RFI requesting 
that participation in Medicare Advantage be credited as participation 
in Advanced APMs. We recognize that many eligible clinicians 
participating in Medicare Advantage may offer high-value care to 
Medicare beneficiaries enrolled in such plans.
    With respect to the APM Incentive Payment, section 1833(z)(1)(A) of 
the Act clearly states that the APM Incentive Payment is based on 
payments for Part B for covered professional services (which are made 
under the Medicare Physician Fee Schedule) and which do not include 
payments for services furnished to Medicare Advantage enrollees. For QP 
determination calculations, we believe it is important to note that 
APMs may involve Medicare Advantage plans and payers other than 
Medicare. Under the All-Payer Combination Option for QP determinations, 
eligible clinicians and Advanced APM Entities can meet the QP threshold 
based in part on payment amounts or patients counts associated with 
Medicare Advantage plans and other payers, provided that such 
arrangements meet the criteria to be considered Other Payer Advanced 
APMs. However, under sections 1833(z)(2)(A), (2)(B)(i), and (3)(B)(i) 
of the Act, such Medicare Advantage and other payer payments cannot be 
included in the QP determination calculations under the Medicare 
Option, which requires that we only consider payment amounts or patient 
counts for Medicare Part B covered professional services. Regardless of 
which option--Medicare or All-Payer Combination--is used to determine 
that an eligible clinician is a QP for a year, the APM Incentive 
Payment calculation will only be based upon payments for Medicare Part 
B covered professional services, which does not include payments for

[[Page 28335]]

services furnished to Medicare Advantage enrollees.
    We recognize that Medicare Advantage contracts can include 
financial risk as well as quality performance standards and certified 
EHR and other health IT requirements that support high-value care. We 
propose to evaluate payment arrangements between eligible clinicians, 
APMs Entities and MA plans as Other Payer APMs and according to the 
proposed Other Payer Advanced APM criteria. In the assessment of MA 
plans with respect to the Other Payer Advanced APM criteria, it is 
important to note that the requirements refer to aspects of the payment 
arrangement between the MA plan and the participating APM Entity, and 
this includes the criterion for bearing more than a nominal amount of 
financial risk. To qualify as an Other Payer Advanced APM, there must 
be a financial risk component. We would not consider an arrangement 
where the MA plan meets the CEHRT and quality measures criteria 
outlined in this proposed rule, but pays the APM Entity on a fee-for-
service basis, to be an Other Payer Advanced APM because there is no 
risk connected to actual cost of care exceeding projected cost of care. 
Because this arrangement would not be an Other Payer Advanced APM, it 
would not be assessed for the purposes of determining QPs. In addition, 
the financial relationship between CMS and the MA plan--even if the 
relationship is part of a APM--is not relevant to this assessment 
because there would not be a direct payment arrangement between CMS and 
the APM Entities or eligible clinicians.
    We also received comments on the MIPS and APMs RFI expressing 
concern that the distribution of APM Incentive Payments could 
disadvantage Medicare Advantage plans relative to Medicare FFS by 
changing payment rates for health plans in a given area based on the 
aggregate APM incentive amounts paid to eligible clinicians in that 
area. APM Incentive Payments will be lump-sum payments made under 
Medicare Part B, but outside of the claims payment system. Medicare 
Advantage rates are set through a separate process, and payment 
policies for 2019 will be addressed in the Advance Notice and Rate 
Announcement for that program.
c. Calculation of All-Payer Combination Option Threshold Score
(1) Submission of Information for Other Payer Advanced APM 
Determination and Threshold Score Calculation
    We propose that APM Entities and/or eligible clinicians must submit 
certain information for CMS to assess whether other payer arrangements 
meet the Other Payer Advanced APM criteria and to calculate Threshold 
Scores a QP determination under the All-Payer Combination Option. For 
CMS to make QP determinations at the individual eligible clinician 
level in the specified exception cases described in section II.F.5 and 
II.F.6 of this preamble, either the Advanced APM Entity or the eligible 
clinician may submit this information with respect to the individual 
eligible clinician. If we do not receive sufficient information to 
complete our evaluation of the other payer arrangement and perform the 
QP threshold calculation, we would not evaluate the eligible clinicians 
under the All-Payer Combination Option.
    We propose that submissions by APM Entities and/or eligible 
clinicians must include at least sufficient information for CMS to 
determine whether the payment arrangement meets the Other Payer 
Advanced APM criteria described in this section. To make the QP 
determination using the All-Payer Combination Option, submissions must 
include specific payment and patient numbers for each payer from whom 
the eligible clinician has received payments during the QP Performance 
Period, in order to calculate the Advanced APM Entity eligible 
clinician group's or individual eligible clinician's Threshold Score. 
We propose that--by a date and in a manner specified by CMS--the 
following data must be submitted to CMS for consideration under the 
All-Payer Combination Option: (1) The payment amounts and/or number of 
patients furnished any service through each Other Payer Advanced APM 
for each payer; and (2) the sum of their total payment amounts and/or 
number of patients furnished any service from each payer.
    CMS will ask each payer to attest to the accuracy of all submitted 
information including the reported payment and patient data. Contracts 
may be subject to audit by CMS. We propose that if a payer does not 
attest to the accuracy of the reported payment and patient data, these 
data will not be assessed under the All-Payer Combination Option. 
However, we recognize that such a requirement leaves eligible 
clinicians dependent on a payer over which they may have limited 
control. We therefore seek comment on alternatives to requiring payer 
attestation, such as addressing the scope and intensity of audits to 
verify the submitted data. For Advanced APM Entities and eligible 
clinicians participating in Medicaid, CMS will initiate a review and 
determine in advance of the QP determination period the existence of 
Medicaid Medical Home Models and Medicaid APMs based on information 
obtained from state Medicaid agencies and other authorities, such as 
professional organizations or research entities. We seek comment 
regarding how such a review and determination could be conducted.
    Detailed guidance on implementing data collection for Calculation 
of the All-Payer Combination Option Threshold Score will be issued 
prior to 2019.
(1) Use of Methods
    CMS may apply one or both of two different methods--using payment 
amounts or patient counts--to arrive at an eligible clinician's 
Threshold Score. CMS will compare the Threshold Score against the 
relevant QP Threshold or Partial QP Threshold to determine an eligible 
clinician's QP status for the year.
    We propose that CMS would calculate Threshold Scores for eligible 
clinicians in an Advanced APM Entity under both the payment amount and 
patient count methods for each QP Performance Period. We also propose 
that CMS would assign QP status using the more advantageous of the 
Advanced APM Entity's two scores.
    We believe that both the payment amount and patient count methods 
should be considered in order to produce Threshold Scores. As the two 
calculations differ there may be cases in which Threshold Scores vary 
enough that different QP determinations could result depending on which 
is used. In such an event, we do not believe that prioritizing the 
Threshold Score using one calculation over the other would yield an 
appropriate, non-arbitrary result. By using the greater of the 
Threshold Scores achieved, we hope to promote simplicity in QP 
determinations and to maximize the number of eligible clinicians that 
attain QP status each year. We seek comment on the use of the payment 
and patient count methods for the All-Payer Combination Option.
(2) Excluded Payments
    Section 1833(z)(2)(B)(ii)(I) and (C)(ii)(I) of the Act specifies 
that the calculation under the All-Payer

[[Page 28336]]

Combination Option is based on the sum of both payments for Medicare 
Part B covered professional services and, with certain exceptions, all 
other payments, regardless of payer. We propose that we will include 
such ``all other'' payments in the numerator and the denominator, and 
we will exclude payments as specified in the statute. We also propose 
to exclude patients associated with these excluded payments from the 
patient count method.
    The statue excludes payments made:
     By the Secretary of Defense for the costs of Department of 
Defense health care programs;
     By the Secretary of Veterans Affairs for the costs of 
Department of Veterans Affairs health care programs; and
     Under Title XIX in a state in which no Medicaid Medical 
Home Model or APM is available under the state plan.
    We propose that title XIX payments or patients would be excluded in 
the numerator and denominator for the QP determination unless: (1) A 
state has at least one Medicaid Medical Home Model or Medicaid APM in 
operation that is determined to be an Other Payer Advanced APM; and (2) 
the relevant Advanced APM Entity is eligible to participate in at least 
one of such Other Payer Advanced APMs during the QP Performance Period, 
regardless of whether the Advanced APM Entity actually participates in 
such Other Payer Advanced APMs. This will apply to both the payment 
amount and patient count methods. We believe this Medicaid exclusion 
avoids penalizing eligible clinicians who do not have the possibility 
of participation in an Other Payer Advanced APM under Medicaid. We 
believe that failing to exclude such payments and/or patients would 
unduly disadvantage potential QPs by inflating denominators based on 
circumstances beyond their control. For example, if a state's Medicaid 
Medical Home Model is determined to be an Other Payer Advanced APM and 
is operated on a statewide basis, Medicaid payments will be included in 
the denominator for all eligible clinicians in that state assessed 
under the All-Payer Combination Option. However, if the state operates 
such an Other Payer Advanced APM at a sub-state level, and eligible 
clinicians who do not practice in the geographic area where the 
Medicaid Medical Home Model is available are not eligible to 
participate, Medicaid payments would not be included in such eligible 
clinicians' QP calculations. We will more fully develop the approach to 
identify Medicaid Medical Home Models and Medicaid APMs, as well as 
eligible clinician eligibility to participate in them, through 
subsequent rulemaking.
    We seek comment on our proposals to determine exclusions and on how 
we could account for eligible clinician participation in Medicaid APM 
or Medicaid Medical Home Models, such as pilots where participation may 
be intentionally limited by the state.
(3) Payment Amount Method
    We propose to calculate an All-Payer Combination Option Threshold 
Score for eligible clinicians in an Advanced APM Entity using the 
payment amount method, which would then be compared to the relevant QP 
Payment Amount Threshold and Partial QP Payment Amount Threshold to 
make a QP determination.
(a) Threshold Score Calculation
(i) In General
    We propose to calculate the All-Payer Threshold Score for eligible 
clinicians in an Advanced APM Entity (or an eligible clinician that 
participates in multiple APMs, as this exception is discussed above) by 
dividing the value described under paragraph (ii) by the value 
described under paragraph (iii). This calculation would result in a 
percent value Threshold Score that CMS would compare to the QP Payment 
Amount Threshold and the Partial QP Payment Amount Threshold to 
determine the QP status of the eligible clinicians for the payment 
year. The calculations occur in two steps because there is a Medicare 
QP Threshold and an All-Payer QP Threshold. The formula for determining 
the payment Threshold Score is: Threshold Score = A/B, where:

A = The numerator value under paragraph (ii) below
B = The denominator value under paragraph (iii) below
(ii) Numerator
    We propose that the numerator would be the aggregate of all 
payments from all other payers, except those excluded under sections 
1833(z)(2)(B)(ii)(I) and (C)(ii)(I) of the Act, to the Advanced APM 
Entity's eligible clinicians--or the eligible clinician in the event of 
an individual eligible clinician assessment--under the terms of all 
Other Payer Advanced APMs during the QP Performance Period. For 
example, if a beneficiary is attributed to an ACO and sees a clinician 
outside that ACO, payments made to the non-ACO clinician would not 
count towards this numerator, even if the ACO is an Other Payer 
Advanced APM. Medicare Part B covered professional services will be 
calculated under the All-Payer Combination Option in the same manner as 
it is for the Medicare Option.
(iii) Denominator
    We propose that the denominator would be the aggregate of all 
payments from all other payers, except those excluded under sections 
1833(z)(2)(B)(ii)(I) and (C)(ii)(I) of the Act, to the Advanced APM 
Entity's eligible clinicians--or the eligible clinician in the event of 
an individual eligible clinician assessment--during the QP Performance 
Period. The portion of this amount that relates to Medicare Part B 
covered professional services will be calculated under the All-Payer 
Combination Option in the same manner as it is for the Medicare Option.
(b) Examples of Payment Amount Threshold Score Calculation
    In this example, an Advanced APM Entity participates in a Medicare 
ACO initiative, a commercial ACO arrangement, and a Medicaid APM. Each 
of the APMs is determined to be an Advanced APM. In the QP Performance 
Period for payment year 2021 (proposed in this proposed rule to be 
2019), the Advanced APM Entity receives the following payments:

[[Page 28337]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.050

    In Table 41, the Advanced APM Entity meets the minimum Medicare 
threshold (30% >25%). However, it falls short of the QP Payment Amount 
Threshold (43% <50%). In this case, the Advanced APM Entity would meet 
the Partial QP Payment Amount Threshold (43% >40%).
    Another Advanced APM Entity in the same year receives the following 
payments:
[GRAPHIC] [TIFF OMITTED] TP09MY16.051

    In Table 42, the Advanced APM Entity meets the minimum Medicare 
threshold (40% >25%). It also exceeds the QP Payment Amount Threshold 
(61% >50%). In this case, the eligible clinicians in the Advanced APM 
Entity would become QPs.
    We seek comment on the payment amount method described in this 
proposal and any potential alternative approaches.
(4) Patient Count Method
    We propose to calculate a Threshold Score for the eligible 
clinician group in an Advanced APM Entity--or eligible clinician in the 
exception situations under sections II.F.5 and II.F.6 of this 
preamble--using the patient count method, which would then be compared 
against the relevant QP Patient Count Threshold and Partial QP Patient 
Count Threshold to determine the QP status of an eligible clinician for 
the year based on the higher of the two values.
(a) Threshold Score Calculation
(i) In General
    We propose that the Threshold Score calculation for the patient 
count method would include patients for whom the eligible clinicians in 
an Advanced APM Entity furnish services and receive payment under the 
terms of an Other Payer Advanced APM, with certain exceptions as 
outlined in the previous section. This calculation would result in a 
percent value Threshold Score that CMS would compare to the QP Patient 
Count Threshold and the Partial QP Patient Count Threshold to determine 
the eligible clinicians' QP status for the payment year. The 
calculations occur in two steps as there is a Medicare Threshold 
requirement and an All-Payer Threshold requirement. The formula for 
determining the patient count Threshold Score is:

Threshold Score = A/B,

where:

A = The numerator value under paragraph (iii) below.
B = The denominator value under paragraph (iv) below.
(ii) Unique Patients
    First, we propose that, like the Medicare Option, the patient count 
method under the All-Payer Combination Option would only count unique 
patients, with multiple eligible clinicians able to count the same 
patient. Similarly, we propose to count a single patient, where 
appropriate, in the numerator and denominator for multiple different 
Advanced APM Entities when counting the number of beneficiaries under 
this method section II.F.6 of this preamble. We also propose that CMS 
will not count any patient more than once for any single Advanced APM 
Entity. In other words, for each Advanced APM Entity, CMS will count 
each unique patient one time in the numerator, and one time in the 
denominator.
    We believe that counting patients this way maintains integrity by 
preventing double counting of patients within an Advanced APM Entity 
while recognizing the reality that patients often have relationships 
with eligible clinicians in different organizations. We hope to avoid 
distorting patient counts for such overlap situations, especially in 
Advanced APM Entity-dense markets.
    We seek comment on our proposal for counting patients and on 
alternative methods for counting beneficiary overlaps across Advanced 
APM Entities.
(iii) Numerator
    We propose that the numerator would be the number of unique 
patients to whom eligible clinicians in the Advanced APM Entity furnish 
services that are included in the measures of

[[Page 28338]]

aggregate expenditures used under the terms of all of their Other Payer 
Advanced APMs during the QP Performance Period, plus the patient count 
numerator for Advanced APMs. A patient would count in the non-Medicare 
portion of this numerator only if, as stated above, the eligible 
clinician furnishes services to the patient and receives payment(s) for 
furnishing those services under the terms of an Other Payer Advanced 
APM.
(iv) Denominator
    We propose that the denominator would be the number of unique 
patients to whom eligible clinicians in the Advanced APM Entity furnish 
services under all non-excluded payers during the QP Performance 
Period.
(b) Examples of Patient Count Threshold Score Calculation
    In the QP Performance Period for payment year 2021 (proposed to be 
2019 under this proposed rule) the Advanced APM entity experienced the 
following patient counts:
[GRAPHIC] [TIFF OMITTED] TP09MY16.052

    In Table 43, the Advanced APM Entity meets the minimum Medicare 
threshold (30% >20%). However, it falls short of the QP Patient Count 
Threshold (30% <35%). In this case, the Advanced APM Entity would meet 
the Partial QP Patient Count Threshold (30% >25%).
    Another Advanced APM Entity in the same year experienced the 
following patient counts:
[GRAPHIC] [TIFF OMITTED] TP09MY16.053

    In Table 44, the Advanced APM Entity meets the minimum Medicare 
threshold (40% > 20%). It also exceeds the minimum QP Patient Count 
Threshold (61% > 35%). In this case, the eligible clinicians in the 
Advanced APM Entity would become QPs.
    We seek comment on the patient count method described above and any 
potential alternative approaches.
d. Submission of Information for Assessment Under the All-Payer 
Combination Threshold Option
    Under sections 1833(z)(2)(B)(ii)(III) and (C)(ii)(III), an eligible 
clinician can only become a QP using the All-Payer Combination Option 
by providing the Secretary such information as is necessary for the 
Secretary to determine whether an Other Payer APM is an Other Payer 
Advanced APM and to determine the eligible clinician's Threshold Score 
under section II.F.7.c of this preamble. To be considered under the 
All-Payer Combination Option we propose that APM Entities or individual 
eligible clinicians must submit by a date and in a manner determined by 
CMS: (1) Payment arrangement information necessary to assess whether 
each Other Payer APM is an Other Payer Advanced APM, including 
information on financial risk arrangements, use of certified EHR 
technology, and payment tied to quality measures; and (2) for each 
Other Payer APM, the amounts of revenues for services furnished through 
the arrangement, the total revenues from the payer, the numbers of 
patients furnished any service through the arrangement (that is, 
patients for whom the eligible clinician is at risk if actual 
expenditures exceed projected expenditures), and the total numbers of 
patients furnished any service through the payer. CMS would then assess 
the characteristics of the Other Payer APMs to determine if they are 
Other Payer Advanced APMs and would notify the APM Entities and/or 
eligible clinicians of the Other Payer Advanced APM determinations 
based on their submissions. We propose further, that an Other Payer 
Advanced APM is required to have an outcome measure. If an Other Payer 
Advanced APM has no outcome measure, the Advanced APM Entity must 
attest that there is no applicable outcome measure on the MIPs list. 
CMS intends to establish specific requirements regarding the timing and 
manner of submission of such information through future rulemaking.
    At this time, we seek comment from stakeholders on the specific 
types of payment arrangement information that would be necessary to 
assess whether an

[[Page 28339]]

Other Payer APM is an Other Payer Advanced APM, and the format in which 
CMS could reasonably expect to receive this information. We seek 
comment on the level of detail which CMS should require, and whether 
certain pieces of information would be most easily submitted directly 
from individual eligible clinicians or from an APM Entity. We also seek 
comment on the timing of when CMS could expect to receive this 
information from individual eligible clinicians and Advanced APM 
Entities for a performance year. In addition, we seek comment on the 
proposed requirement that an Other Payer Advanced APM must have an 
outcome measure.
    We seek comment on the possibility of receiving information on 
Other Payer APMs and their participants directly from other payers in 
order to minimize reporting burden for APM Entities and eligible 
clinicians. We seek comment on the extent to which collecting voluntary 
submissions of data from other payers could reduce burden and increase 
program integrity through more accurate determinations of QP status 
based on payment or patient threshold calculations for Other Payer 
Advanced APMs. Likewise, we seek comment on the extent to which such 
data collection is operationally feasible or could infringe upon other 
payers' interests in maintaining the confidentiality of their business 
practices.
    In addition, we propose to make early Other Payer Advanced APM 
determinations on other payer arrangements if sufficient information is 
submitted at least 60 days before the beginning of a QP Performance 
Period. This would allow CMS to offer eligible clinicians advance 
notice of their prospects of achieving QP status in the event they are 
assessed under the All-Payer Combination Option. This early 
determination would be considered final for the QP Performance Period 
based on the Other Payer APM information submitted. If new information 
is submitted based on a change in the Other Payer APM during the QP 
Performance Period, the initial determination could be subject to 
review and revision. We also propose that, to the extent permitted by 
federal law, CMS would maintain confidentiality of certain information 
that the Advanced APM Entities and/or eligible clinicians submit 
regarding Other Payer Advanced APM status in order to avoid 
dissemination of potentially sensitive contractual information or trade 
secrets. We propose that, unlike our proposal for Advanced APM 
determinations, the Other Payer Advanced APM determinations would be 
made available directly to participating APM Entities and eligible 
clinicians rather than through public notice, and we would explain how 
and within what timeframes such notifications will occur in 
subregulatory guidance. CMS may consider publicly releasing information 
on Other Payer Advanced APMs on the CMS Web site with general and/or 
aggregate information on the payers involved and the scopes of such 
agreements.
    We seek comment on the proposed timing and method of feedback to 
Advanced APM Entities and eligible clinicians regarding the status of 
Other Payer Advanced APMs for which they have submitted information and 
on the proposed early determination process and the ability of Advanced 
APM Entities and eligible clinicians to submit sufficient information 
prior to the beginning of a QP Performance Period. We also seek comment 
on the types of information that contain potentially sensitive 
information.
    The information submitted to determine whether an eligible 
clinician is a QP under the All-Payer Combination Option may be subject 
to audit, and eligible clinicians and Advanced APM Entities will be 
required to maintain copies of any supporting documentation. If an 
audit reveals a material discrepancy in the information submitted to 
CMS, and such discrepancy affected the eligible clinician's QP status, 
the APM Incentive Payment may be recouped. Providing false information 
may reflect a false claim subject to investigation and prosecution. We 
may provide further details on the audit and recoupment process under 
the All-Payer Combination Option in future rulemaking.
8. APM Incentive Payment
    The APM Incentive Payment is specified under section 1833(z)(1) of 
the Act.
a. Amount of the APM Incentive Payment
    This section describes our proposal for calculating the amount of 
the APM Incentive Payment and accounts for the specific scenarios 
outlined under sections 1833(z)(1)(A)(i) and 1833(z)(1)(A)(ii) of the 
Act. This section also describes the process by which CMS proposes to 
disburse these APM Incentive Payments to QPs.
    In accordance with section 1833(z)(1)(A) of the Act, CMS will make 
an APM Incentive Payment for a year to eligible clinicians that achieve 
QP status for the year during years 2019 through 2024. In accordance 
with the statute, we propose that this APM Incentive Payment shall be 
equal to 5 percent of the estimated aggregate amounts paid for Medicare 
Part B covered professional services furnished by the eligible 
clinician from the preceding year across all billing TINs associated 
with the QP's NPI.
(1) Incentive Payment Base Period
    The incentive payment base period is the range of dates that will 
be used to calculate the estimated aggregate payment amounts for the 
year preceding the QP payment year that will serve as the basis for the 
incentive payment. Section 1833(z)(1)(A) of the Act states that in 
calculating the amount that is equal to 5 percent of the estimated 
aggregate payment amounts for Medicare Part B covered professional 
services under this part for the preceding year, the payment amount for 
the preceding year may be an estimation for the full preceding year 
based on a period of such preceding year that is less than the full 
year. We believe this provision gives CMS flexibility in determining 
the incentive payment base period. We propose to use the full calendar 
year prior to the payment year as the incentive payment base period 
from which to calculate the estimated aggregated payment amounts.
    When determining the time period for the incentive payment base 
period, we considered using a partial calendar year and a completion 
factor to forecast and account for the remainder of claims that would 
be billed during the remainder of the calendar year. However, there are 
instances where eligible clinician practice patterns change during a 
given period of time. For example, an eligible clinician may begin 
practicing, retire, change practice locations, or switch between full-
time and part-time; or there could be seasonal fluctuations in an 
eligible clinician's practice. Given the possible variability in 
billings and payments over a calendar year, we believe an incentive 
payment base period of less than one year would produce a less accurate 
estimated aggregated payment amount and could potentially disadvantage 
some eligible clinicians based on the circumstances of their practice 
in a given year.
    Using a complete calendar year of claims would allow for the most 
accurate representation of the covered professional services delivered 
by each eligible clinician, which we believe outweighs a modest 
potential delay in making the APM Incentive Payment. We seek comment on 
our proposal to use the entire preceding calendar year as the incentive 
payment base period.

[[Page 28340]]

(2) Timeframe of Claims
    Section 1833(z)(1)(A) of the Act directs CMS to make the APM 
Incentive Payment in a lump sum on an annual basis ``as soon as 
practicable.'' We believe that, in implementing this provision, it is 
important to balance the desire for accuracy in the data used to 
calculate the APM Incentive Payment with the desire to expedite the 
payments so that the APM Incentive Payments are made in an appropriate 
and timely manner.
    We propose to calculate the APM Incentive Payment based on data 
available 3 months after the end of the incentive payment base period 
in order to allow time for claims to be processed. For example, for the 
2019 payment year, we would capture claims submitted with dates of 
service from January 1, 2018 through December 31, 2018 and processing 
dates of January 1, 2018 through March 31, 2019. We believe that 3 
months of claims run-out is sufficient to conduct the APM Incentive 
Payment calculations in an accurate and timely manner. This methodology 
is consistent with the claims run-out timeframes used for 
reconciliation payments in several current APMs, such as the Shared 
Savings Program, the Pioneer and Next Generation ACO Models, and CEC. 
We seek comment on the potential use of a completion factor. We note 
that several current APMs apply the 3 month claims run-out in 
conjunction with a completion factor. However, where a completion 
factor may be appropriate for payments based on claims submitted by 
groups of providers and suppliers that may be billing under multiple 
TINs, we believe that with payments based on individual eligible 
clinician claims, categorical variability in claims completion across 
type of eligible clinicians would cause inequitable results.
    We recognize that by pulling claims 3 months after the end of the 
performance year to conduct reconciliation, we would not have a 
complete claims run-out, especially for the later months of the year. 
We considered instead proposing a 6 month of claims run-out. On 
average, 99.3 percent of Medicare claims are processed within 3 months 
after the end of a calendar year, and 99.8 percent of claims are 
processed within 6 months after the end of a calendar year. We 
concluded that the benefit of making the incentive payments 3 months 
earlier outweighed the benefit of an additional 3 months of processed 
claims, since the difference in claims completion is extremely small. 
We also believe that our proposal provides an additional incentive for 
timely submission of claims at the end of the year because claims for 
services furnished during the incentive payment base period that are 
not submitted and processed within this 3 month run-out would not be 
considered in the incentive payment amount calculations.
    We also considered our regulations at Sec.  424.44 and the Medicare 
Claims Processing Manual (Pub. L. 100-04), Chapter 1, Section 70, 
stating that Medicare claims can be submitted no later than one 
calendar year from the date of service. We considered waiting for the 
full claims run-out 12 months after the end of the performance year, 
but were concerned that this approach would significantly delay the 
timing of the incentive payments and possibly dilute their effect as a 
reward for eligible clinician decisions to participate in APMs. We also 
believe that such a significant delay would not be consistent with the 
statutory intent of making payments as soon as practicable.
    In summary, for the incentive payment base period we propose to use 
a complete calendar year of claims with 3 months of claims run-out from 
the end of the calendar year. We believe our proposed approach balances 
our goals of providing incentive payments in a reasonable timeframe 
while being able to account for the vast majority (on average, 99.3 
percent of claims for) covered professional services. Given these 
parameters, we estimate that incentive payments could be made 
approximately 6 months after the end of the incentive payment base 
period, or roughly mid-way through the payment year. However, we 
propose that the APM Incentive Payment would be made no later than one 
year from end of the incentive payment base period. We do not propose 
to set a specific deadline mid-way during the payment year because we 
believe doing so could pose operational risks in the event that 6 
months is impracticable in a given year for reasons that CMS cannot 
predict. We seek comment on our proposed timing of the incentive 
payment base period.
(3) Treatment of Payment Adjustments in Calculating the Amount of APM 
Incentive Payment
    Part B covered professional services under the Medicare PFS are 
currently subject to several statutory provisions that are geared 
towards improving quality and efficiency in service delivery. Eligible 
clinicians are subject to payment adjustments under: The Medicare EHR 
Incentive Program for Eligible Professionals (MU), the PQRS, and the 
VM. Beginning in 2019, the MIPS adjustment, as described in section 
II.E.5, will replace payment adjustments under the MU, PQRS, and VM for 
all MIPS eligible clinicians. These special payment provisions directly 
adjust the payment amount that eligible clinicians receive under the 
PFS. In contrast, we consider the APM Incentive Payment to be separate 
from, and, as indicated under section 1833(z)(1)(A) of the Act, in 
addition to the amount of payments made for covered professional 
services under the Medicare PFS.
    We propose to exclude the MIPS, VM, MU and PQRS payment adjustments 
when calculating the estimated aggregate payment amount for covered 
professional services upon which to base the APM Incentive Payment 
amount. For example, a QP who receives an upward fee adjustment during 
2018 in VM would not see that adjustment reflected in the estimated 
aggregate payment amount for covered professional services used to 
calculate his or her APM Incentive Payment in 2019. Similarly, a QP who 
receives a downward fee adjustment during 2018 in VM would not see that 
amount reflected in the aggregate payment amount for the APM Incentive 
Payment.
    We believe this proposed policy is most consistent with the 
specification in section 1833(z)(1)(A) of the Act that the APM 
Incentive Payment is based on the estimated aggregate payment amounts 
for ``such'' covered professional services for the preceding year, 
which refers to the Part B covered professional services furnished by 
the particular eligible clinician.
    While we considered the alternative of including these performance-
related payment adjustments in calculating the APM Incentive Payment, 
we are concerned that such a policy would create incentives that are 
not aligned with the intent of the APM Incentive Payment. As previously 
stated in our policy principles, we believe that the APM Incentive 
Payment is best viewed as a complementary reward for eligible 
clinicians that have a substantial degree of participation in the most 
advanced APMs and deliver high-value care, not an evaluation of their 
performance within the APM or in another statutorily required 
performance-based payment adjustment.
    For example, the incentive payment base period for the 2019 payment 
year will be 2018, and any QP in payment year 2019 may have quality 
payment adjustments from the PQRS, MU, and VM payment provisions, which 
affect the amount of incentive payment for that year, in the incentive 
payment base period. The PQRS, MU, and VM payment adjustments will 
sunset at the end of 2018. In addition, in 2020 and

[[Page 28341]]

later, eligible clinicians who were subject to MIPS in the previous 
performance year and become newly qualified as QPs may have MIPS 
quality payment adjustments during the base period affecting their APM 
Incentive Payment amounts for that period. We do not believe the intent 
of the APM Incentive Payment is to further magnify the currently 
existing and future payment adjustments because of overlapping time 
periods.
    We also proposed in section II.F.6.b.(1) to account for payment 
adjustments in the QP determination process in the same manner as when 
calculating the amount of the APM Incentive Payment. If we were to 
include statutory payment adjustments when determining QP status, there 
could be situations where an eligible clinician could become a QP 
because of a positive payment adjustment amount, or conversely, there 
could be situations where an eligible clinician would not meet the QP 
threshold because of a negative payment adjustment. We believe that our 
proposal to not include payment adjustments when determining QP status 
for a year, or when calculating the amount of the APM Incentive 
Payment, allows CMS to assess all eligible clinicians on the same 
merits throughout the entire QP determination and APM Incentive 
Calculation process. We do not believe the intent of the statute was to 
enhance or negate an eligible clinician's opportunity to become a QP in 
a given performance year, or to enhance or negate the amount of APM 
Incentive Payment a QP receives, based on factors that are extraneous 
to APM participation.
    We seek comment on this proposed approach to coordinating the 
various Medicare Physician Fee Schedule payment adjustments when 
calculating the amount of the APM Incentive Payment.
(4) Treatment of Payments for Services Paid on a Basis Other Than Fee-
For-Service
    We recognize that many APMs use incentives and financial 
arrangements that differ from usual fee schedule payments. Section 
1833(z)(1)(A)(i) of the Act requires us to establish policies for 
payments that are made to an Advanced APM Entity rather than directly 
to the QP. Section 1833(z)(1)(A)(ii) of the Act requires us to 
establish policies for when payment is made on a basis other than fee-
for-service. For the purposes of this proposed regulation, we place 
such payments into three categories: Financial risk payments, 
supplemental service payments, and cash flow mechanisms.
    Financial risk payments are non-claims-based payments, based on 
performance in an APM when an APM Entity assumes responsibility for the 
cost of a beneficiary's care, whether it be for an entire performance 
year, or for a shorter duration of time, such as over the course of a 
defined episode of care. We note that in the context of categorizing 
these types of payments as ``financial risk payments,'' we refer to 
payments that may be based on the cost of a beneficiary's care and do 
not necessarily limit these payments to financial arrangements that 
would require an APM Entity to accept downside risk. For instance, we 
would consider the shared savings payments to ACOs in all tracks of the 
Shared Savings Program to be financial risk payments. We would also 
consider net payment reconciliation amounts from CMS to an Awardee (or 
vice versa) under the BPCI Initiative, and reconciliation payments from 
CMS to a participant hospital or repayment amounts from a participant 
hospital to CMS under the CJR model to be examples of financial risk 
payments.
    We propose to exclude financial risk payments such as shared 
savings payments or net reconciliation payments, when calculating the 
estimated aggregate payment amount. Financial risk payments are not for 
specific Medicare Part B covered professional services; rather they are 
for performance in an APM. Therefore, we believe their inclusion in the 
estimated aggregate payment amount would be inconsistent with the 
statutory language and our stated policy principles. In addition, the 
difficulty of disaggregating payments to individual QPs and the lagged 
timing of some financial risk payments creates significant policy and 
operational barriers that we do not believe are in line with our 
objective of making APM Incentive Payments in a timely manner.
    Supplemental service payments are Medicare Part B payments for 
longitudinal management of a beneficiary's health, or for services that 
are within the scope of medical and other health services under 
Medicare Part B that are not separately reimbursed through the 
physician fee schedule. Often these are per-beneficiary per-month 
(PBPM) payments that are made for care management services or 
separately billable services that share the goal of improving quality 
of care overall, enabling investments in care improvement, and reducing 
Medicare expenditures for services that could be avoided through care 
coordination. For example, the OCM makes a per beneficiary Monthly 
Enhanced Oncology Services (MEOS) payment to practices for care 
management and coordination during episodes of care initiated by 
chemotherapy treatment.
    We propose to determine on a case-by-case basis whether certain 
supplemental service payments are in lieu of covered services that are 
reimbursed under the PFS. In cases where payments are for covered 
services that are in lieu of services reimbursed under the PFS, those 
payments would be considered covered professional services and would be 
included in the APM Incentive Payment amounts. We propose to include a 
supplemental service payment in calculation of the APM Incentive 
Payment amount if it meets all of the following 4 criteria:
    (1) Payment is for services that constitute physician services 
authorized under section 1832(a) of the Act and defined under section 
1861(s) of the Act.
    (2) Payment is made for only Part B services under the first 
criterion above, that is, payment is not for a mix of Part A and Part B 
services.
    (3) Payment is directly attributable to services furnished to an 
individual beneficiary.
    (4) Payment is directly attributable to an eligible clinician.
    Table 45 provides an example of how a limited number of 
supplemental service payments in currently operating or recently 
announced APMs would be considered with respect to our proposed 
criteria. We further propose to establish a process by which we notify 
the public of the supplemental service payments in all APMs and 
identify the supplemental service payments that meet our proposed 
criteria and would be included in the APM Incentive Payment 
calculations. Similar to our proposal to announce Advanced APM 
determinations, we propose to post an initial list of supplemental 
service payments that would be included in our APM Incentive Payment 
calculations on the CMS Web site. As new APMs are announced, CMS would 
include its determination of whether an APM related supplemental 
service payment would be included in our APM Incentive Payment 
calculations, if applicable, in conjunction with the first public 
notice of the APM. We propose to update the list of supplemental 
service payments that would be included in our APM Incentive Payment 
calculations on an ad hoc basis, but no less frequently than on an 
annual basis.
    We seek comment on this proposed approach to include certain 
supplemental service payments when calculating the basis for the amount 
of the APM Incentive Payment.

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Specifically, we seek comment on our proposed criteria to include 
supplemental service payments in the basis for the APM Incentive 
Payment amounts, and our proposed method for announcing which 
supplemental service payments would be included in the basis for the 
APM Incentive Payment amounts.
[GRAPHIC] [TIFF OMITTED] TP09MY16.054

    Cash flow mechanisms involve changes in the method of payments for 
services furnished by providers and suppliers participating in an APM 
Entity. In themselves, cash flow mechanisms do not change the overall 
amount of payments. Rather, they change cash flow by providing a 
different method of payment for services. An example of a cash flow 
mechanism is the population-based payment (PBP) available in the 
Pioneer ACO Model and the Next Generation ACO Model. PBP provides ACOs 
with a monthly lump sum payment in exchange for a percentage reduction 
in Medicare fee-for-service payments to certain ACO providers and 
suppliers.
    For expenditures affected by cash flow mechanisms, we propose to 
calculate the estimated aggregate payment amount using the payment 
amounts that would have occurred for Part B covered professional 
services if the cash flow mechanism had not been in place. For example, 
for QPs in an ACO receiving PBP with a 50 percent reduction in fee-for-
service payments, we would use the amount that would have been paid for 
Part B covered professional services in the absence of the 50 percent 
reduction. Cash flow mechanisms represent a potential reallocation of 
dollars between eligible clinicians and entities for specific purposes 
related to care improvement. We do not believe that the presence of 
certain cash flow mechanisms should impact the APM Incentive Payment 
amount, and we do not intend for the APM Incentive Payment to influence 
the use or attractiveness of cash flow mechanisms in current and future 
APMs.
    We recognize that new payment methods and financial arrangements 
may be developed that do not fit into these categories as described. 
For instance, in the recently announced CPC + Model, the supplemental 
service payments (that is, the CMFs) would meet all of our proposed 
criteria to be included in the APM Incentive Payment calculations. The 
CMFs are for Medicare Part B covered professional services, and the CMF 
payments will only cover Medicare Part B covered professional services. 
The CMF amounts will be risk adjusted based on each individual 
beneficiary's HCC risk scores; therefore these payments will be 
attributable to individual beneficiaries. Additionally, the attribution 
method in the CPC + Model uses a combination of the TIN/Individual NPI/
Practice Address when attributing an individual beneficiary to a CPC 
Practice site. However, the CMF payments for attributed beneficiaries 
are aggregate payments is made to each CPC Practice Site. We recognize 
that throughout the course of a QP Performance Period more than one NPI 
may furnish covered professional services to an attributed beneficiary. 
If that occurs, more than one NPI could potentially receive the 
corresponding CMF for that eligible beneficiary. We do not believe it 
would be appropriate to count the same CMF for more than one NPI. 
Therefore, (assuming that the CPC + Model is deemed an Advanced APM and 
the APM Entity group achieves the QP threshold for a QP Performance 
Period), we could split the CMF amounts equally between the multiple 
NPIs, or we could develop a method to ``assign'' the NPI for which the 
CMFs would be counted in their APM Incentive Payment calculation based 
on the plurality of visits with that beneficiary.
    We seek comment on the methods that CMS could use to allocate the 
supplemental service payments to individual NPIs in these types of 
scenarios in which payment for a supplemental service payment is made 
in the aggregate to an APM Entity.
    We also recognize that payment methods and financial arrangements 
may evolve over time and would need to be addressed in future 
rulemaking. CMS seeks comment on the proposals for accounting for risk-
based payments, supplemental service payments, and cash flow mechanisms 
when calculating the amount of APM Incentive Payment.

[[Page 28343]]

(5) Treatment of Other Incentive Payments in Calculating the Amount of 
APM Incentive Payments
    Section 1833(z)(1)(D) of the Act specifies that CMS shall not 
include certain existing Medicare incentive payments in the calculation 
of the APM Incentive Payment. This includes payments made under section 
1833 of the Act (subsections (m), (x), and (y)). Section 1833(m) of the 
Act describes the HPSA Physician Bonus Program. The HPSA Physician 
Bonus Program provides bonus payments to physicians for physicians' 
services furnished in geographic areas that are designated as of 
December 31 of the prior year by the HRSA as HPSAs under section 332 
(a)(1)(A) of the PHS Act. The HPSA bonus payment is 10 percent of the 
Medicare Part B payment amount for the service; and this bonus is paid 
as a quarterly lump sum payment.
    Subsection (x) describes the Primary Care Incentive Payment (PCIP) 
program. The PCIP payment amount was 10 percent of the payment amount 
for Medicare Part B primary care services furnished by primary care 
practitioners for whom primary care services accounted for at least 60 
percent of their allowed fee-for-service charges in a prior 
qualification period. For purposes of the PCIP program, primary care 
practitioners were defined as those physicians with certain Medicare 
specialty codes and certain types of non-physician practitioners. The 
PCIP payment was made on a quarterly basis. This bonus payment expired 
under the statute on December 31, 2015.
    Subsection (y) describes the HPSA Surgical Incentive Payment 
(HSIP). For major surgical procedures furnished by physicians with a 
primary specialty designation of ``general surgeon'' in HPSAs (under 
section 332(a)(1)(A) of the PHS Act), physicians received an additional 
10 percent bonus payment in addition to the amount of payment that 
would otherwise be made. This additional payment was combined with any 
other HPSA payment outlined in 1833 of the Act, subsection (m), and was 
paid on a quarterly basis. This bonus payment expired under the statute 
on December 31, 2015.
    Section 1833(z)(1)(D) of the Act also directs CMS not to include 
APM Incentive Payments when calculating payments made under section 
1833 (subsections (m), (x), and (y)) of the Act. CMS considers the APM 
Incentive Payment to be separate from the incentive payments as 
previously discussed in this section and has established procedures to 
ensure that the APM Incentive Payment will not be included when 
calculating the amount of incentive payments made under section 1833 
(subsections (m), (x), and (y)) of the Act.
(6) Treatment of the APM Incentive Payment in APM Calculations
    Section 1833(z)(1)(C) states that the amount of the APM Incentive 
Payment shall not be taken into account for purposes of determining 
actual expenditures under an APM and for purposes of determining or 
rebasing any benchmarks used under the APM. As a lump sum payment, the 
APM Incentive Payments will be made outside of the Medicare claims 
processing system. Current APMs, such as the Medicare ACO initiatives 
and the CJR model, have established procedures for ensuring that lump 
sum payments from other APMs are accounted for when they do their APM 
reconciliations and rebasing calculations. We anticipate that each APM 
will have in place a procedure to avoid counting APM Incentive Payments 
toward determining actual expenditures or rebasing any benchmarks under 
the APM.
b. Services Furnished Through CAHs, RHCs, and FQHCs
(1) Critical Access Hospitals (CAHs)
    Eligible clinicians who furnish services at Critical Access 
Hospitals (CAHs) that have elected to be paid for outpatient services 
under section 1834(g)(2)(B) of the Act (Method II) will be eligible to 
become QPs and receive the APM Incentive Payment if they are part of an 
Advanced APM Entity. As stated in section II.F.6.d.(1) of this proposed 
rule, professional services furnished at a Method II CAH are considered 
``covered professional services'' because they are furnished by an 
eligible clinician and payment is based on the Medicare Physician Fee 
Schedule. Therefore, the APM Incentive Payment would be based on the 
amounts paid for those services attributed to the eligible clinician, 
as identified using the attending NPI included on a submitted claim, in 
the same manner as all other covered professional services.
    For an eligible clinician who becomes a QP based on covered 
professional services furnished at a Method II CAH, we propose that the 
APM Incentive Payment would be made to the CAH TIN that is affiliated 
with the Advanced APM Entity. This proposal is consistent with how CMS 
proposes to make the APM Incentive Payment to eligible clinicians who 
practice at locations other than Method II CAHs. We seek comment on 
this proposal.
(2) Rural Health Clinics (RHCs) and Federally Qualified Health Centers 
(FQHCs)
    As explained in section II.F.6.d.(2) of this preamble, payment for 
services furnished by eligible clinicians in RHCs and FQHCs is not 
reimbursed under or based on the PFS. Therefore, professional services 
furnished in those settings would not constitute covered professional 
services under section 1848(k)(3)(A) of the Act and would not be 
considered part of the amount upon which the APM Incentive Payment is 
based. For eligible clinicians that practice in RHCs or FQHCs, this 
does not preclude the inclusion of payment amounts for covered 
professional services furnished by those eligible clinicians in other 
settings. This only excludes payments made for RHC and FQHC services 
furnished by the eligible clinicians. For example, an eligible 
clinician may practice at both an FQHC and with a separate physician 
group practice that receives payment under the PFS. If the eligible 
clinician becomes a QP under the methodologies described in II.F.6, 
whether based on their participation in an Advanced APM Entity that 
includes the FQHC as outlined in section II.F.6.d.(2) or based on their 
participation in an Advanced APM Entity that includes the separate 
physician group practice, or both, only the eligible clinician's 
payments for covered professional services at the separate physician 
group practice setting would form the basis amount for the APM 
Incentive Payment.
c. Payment of the APM Incentive Payment
(1) Payment to the QP
    The APM Incentive Payment, as described in this section, will be 
made to QPs who are identified by their unique TIN/NPI combination as 
participants in an Advanced APM Entity on a CMS maintained list.
    We received a number of comments on the MIPS and APMs RFI regarding 
the process by which we should make the APM Incentive Payment. One 
commenter suggested that we give QPs the opportunity to select where 
they want the APM Incentive Payment to be sent, while another suggested 
that we send payments directly to the individual eligible clinician. A 
number of commenters recommended that CMS make the APM Incentive 
Payments directly to the Advanced APM Entity. Additionally, some 
commenters noted that making payments directly to the Advanced APM 
Entity would allow Advanced APM Entities to fairly and accurately 
allocate incentive payments

[[Page 28344]]

in accordance with the shared risk for individual eligible clinicians 
in the APM Entity. We thank the commenters for their feedback.
    After consideration of these comments, we propose that for eligible 
clinicians that are QPs, CMS would make the APM Incentive Payment to 
the TIN that is affiliated with the Advanced APM Entity through which 
the eligible clinician met the threshold during the QP performance 
period. For both individual eligible clinicians and group practices, 
CMS uses the TIN as the billing unit. Earlier in this section, we 
proposed that the APM Incentive Payment would be calculated across all 
billing TINs associated with an NPI. Medicare has the ability to track 
all unique TIN/NPI combinations associated with an individual NPI, 
including which TINs are affiliated with an Advanced APM entity. We 
considered making separate payments for each TIN/NPI combination 
associated with the individual eligible clinician's APM Incentive 
Payment, similar to the current PQRS incentive payment program. Under 
the current PQRS incentive payment program, incentive payments are paid 
to the holder of the TIN, aggregating individual incentive payments for 
groups that bill under one TIN. For eligible clinicians who submit 
claims under multiple TINs, CMS groups claims by TIN for payment 
purposes and any incentive payments earned are paid to that specific 
TIN. As a result, an eligible clinician with multiple TINs who 
qualifies for the PQRS incentive payment under more than one TIN would 
receive a separate PQRS incentive payment associated with each TIN.
    However, we believe that making the APM Incentive Payments to the 
TIN associated with the Advanced APM Entity during the QP Performance 
Period would be most consistent with section 1833(z) of the Act to 
incentivize participation in Advanced APMs. Rewarding TINs that are not 
involved in an Advanced APM for the activity of their constituent NPIs 
through separate entities seems to be antithetical to the objective of 
the APM Incentive Payment. We also believe that making the APM 
Incentive Payments to the TIN associated with the Advanced APM Entity 
during the QP Performance Period is most consistent with section 
1833(z) of the Act with regards to making the APM Incentive Payments to 
eligible clinicians who become QPs. We also hope to promote simplicity 
and foster QP awareness of the recipient of the APM Incentive Payment 
that is based on their activity within APMs. We also believe that 
making multiple separate payments would increase complexity for both 
CMS and eligible clinicians.
    Additionally, we proposed in section II.F.5 of this preamble, that 
in order to be a QP, an eligible clinician would need to be identified 
using a CMS maintained participation list of eligible clinicians for 
the Advanced APM entity. This proposal would allow CMS to track the APM 
Entity/TIN/NPI identifiers for each individual eligible clinician, and 
we believe that this information will allow CMS to determine which of 
the QP's TINs should receive the APM Incentive Payment.
    We recognize that there may be scenarios in which an individual 
eligible clinician may change his or her affiliation between the QP 
Performance Period and the payment year such that the eligible 
clinician no longer practices at the TIN affiliated with the Advanced 
APM Entity. In this instance, we propose to make the APM Incentive 
Payment to the TIN provided on the eligible clinician's CMS-588 EFT 
Application. This proposal is consistent with the process that CMS has 
used to make incentive payments under other programs, such as the PCIP 
program.
    We seek comment on our proposal to make the APM Incentive Payments 
to the TIN affiliated with the Advanced APM Entity through which an 
individual eligible clinician becomes a QP during the QP Performance 
Period and our proposal to make the APM Incentive Payment when an 
eligible clinician no longer practice at the TIN affiliated with the 
Advanced APM Entity. We also seek comment on alternative options that 
maintain the goals of equity and simplicity, and of using the APM 
Incentive Payment to encourage and reward participation in Advanced 
APMs.
(2) Exceptions
    As discussed in the exceptions section II.F.5 of this preamble, we 
recognize that there may be instances where none of the Advanced APM 
Entities with which an individual eligible clinician participates meets 
the QP threshold. In this instance, we have proposed to assess the 
eligible clinician individually, using services furnished through all 
Advanced APM Entities during the QP Performance Period. When we make 
the QP determination at the individual eligible clinician level, we 
propose to split the APM Incentive Payment amount proportionally across 
all of the QP's TINs associated with Advanced APM Entities. For 
example, if an eligible clinician is a QP who participates in two APMs 
(APM 1 and APM 2), and has 75 percent of his or her payments (or 
patients) used to make the QP determination through APM 1 and 25 
percent of his or her payments (or patients) used to make the QP 
determination APM 2, we would make 75 percent of the APM Incentive 
Payment to the TIN affiliated with APM 1, and 25 percent of the APM 
Incentive Payment to the TIN affiliated with APM 2. We believe that 
splitting the APM Incentive Payment in this way is most consistent with 
section 1833(z) of the Act, as well as our goal to encourage 
participation in APMs. We also believe that splitting the incentive 
payment in this way appropriately recognizes the several activities of 
the individual eligible clinician toward achieving the QP threshold.
    CMS seeks comment on the proposal to split the APM Incentive 
Payment among the QP's TINs associated with Advanced APM Entities in 
instances where the QP determination is made at the individual eligible 
clinician level. We also welcome comments regarding to which TIN(s) 
payments should be made in the cases where the QP changes TIN 
affiliations between the QP Performance Period and the payments of the 
APM Incentive Payment.
(3) Notification of APM Incentive Payment Amount
    We anticipate that the notification of the APM Incentive Payment 
amount will not occur at the same time as the notification of QP 
status, but will occur later in the year to allow for accurate 
calculation and validation of the incentive payment amount. We propose 
to send notification to both Advanced APM Entities and their individual 
participating QPs of their APM Incentive Payment amount as soon as CMS 
has calculated the amount of the APM Incentive Payment and performed 
all necessary validation of the results. Following our proposed method 
to notify eligible clinicians of their QP status, as discussed in 
section II.F.5 of this preamble, we propose that the APM Incentive 
Payment amount notification would be made directly to QPs in 
combination with a general public notice that such calculations have 
been completed for the year. For the direct QP notification, CMS 
intends to include the amount of APM Incentive Payment and the TIN to 
which the incentive payments will be made. In the case that a QP 
determination is made at the individual eligible clinician level, and 
the incentive payment is split across multiple TINS, CMS intends to 
identify which TINs we will make the incentive payment, and include the 
amount of APM Incentive Payment that will be

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made to each TIN. For the notification to Advanced APM Entities, CMS 
intends to include the total amount of APM Incentive Payments that will 
be made to each participating TIN within the Advanced APM Entity, as 
well as QP specific payment amounts. We believe that this is the most 
efficient method to disseminate of this information to all QPs.
    We seek comment on other methods for the notification of APM 
Incentive Payment amount. We also seek comment on the content of such 
notifications so that they may be as clear and useful as possible.
9. Monitoring and Program Integrity
    In an effort to accurately award the APM Incentive Payment and 
preserve the integrity of the Medicare program, we propose that CMS 
will monitor Advanced APM Entities and eligible clinicians on an 
ongoing basis for non-compliance with the conditions of participation 
for Medicare and the terms of the relevant Advanced APMs in which they 
participate during the QP Performance Period. This will include vetting 
of applicants to Advanced APMs to determine whether they are in 
compliance with the conditions of participation of Medicare and 
ongoing, periodic assessments of Advanced APM Entities and eligible 
clinicians by APMs in conjunction with the CMS Center for Program 
Integrity and other relevant federal government departments and 
agencies. These actions are currently taking place for APMs and will 
continue in the future as stated in the proposed rule.
    We propose that if an Advanced APM terminates an Advanced APM 
Entity or eligible clinician during the QP Performance Period for 
program integrity reasons, or if the Advanced APM Entity or eligible 
clinician is out of compliance with program requirements, CMS may 
reduce or deny the APM Incentive Payment to such eligible clinicians. 
In addition, if the APM Incentive Payment is paid during the QP 
Performance Period and the Advanced APM Entity or eligible clinician is 
later terminated due to a program integrity matter arising during the 
QP Performance Period, CMS may recoup all or a portion of the amount of 
the payment from the entity to which CMS made the payment.
    We also propose that CMS will reopen and recoup any payments that 
were made in error in accordance with procedures similar to those set 
forth at Sec. Sec.  405.980 and 405.370 et seq. or established under 
the relevant APM.
    As discussed in section II.F.7.b.(7) of the preamble, we propose 
that APM Entities and/or eligible clinicians must submit certain 
information for CMS to assess whether other payer arrangements meet the 
Other Payer Advanced APM criteria and to calculate the Threshold Score 
for a QP determination under the All-Payer Combination Option. We also 
propose that Advanced APM Entities and eligible clinicians must 
maintain copies of all records related to the All-Payer Combination 
Option for at least ten years and must provide the government with 
access to these records for auditing and inspection purposes. If an 
audit reveals that the information submitted is inaccurate, CMS may 
recoup the APM Incentive Payment. We note that nothing in this proposed 
rule limits or restricts the authority of the Office of the Inspector 
General.
    We seek comment on our monitoring and program integrity proposals.
10. Physician-Focused Payment Models
a. Introduction and Overview
    Section 101(e)(1) of the MACRA entitled, ``Increasing the 
Transparency of Physician-Focused Payment Models,'' adds a new section 
1868(c) to the Act. In general, this section establishes an innovative 
process for individuals and stakeholder entities (stakeholders) to 
propose physician-focused payment models (PFPMs) to the Physician-
Focused Payment Model Technical Advisory Committee (PTAC). A copy of 
the PTAC's charter, established by the Secretary on January 5, 2016, is 
available at https://aspe.hhs.gov/charter-physician-focused-payment-model-technical-advisory-committee.
(1) Overview of the Roles of the Secretary, the PTAC, and CMS
    Section 1868(c)(2)(A) of the Act requires the Secretary to 
establish, through notice and comment rulemaking following an RFI, 
criteria for PFPMs (PFPM criteria), including models for specialist 
physicians, that could be used by the PTAC in making comments and 
recommendations on PFPMs. We issued the MIPS and APMs RFI requesting 
stakeholder input on PFPMs on October 1, 2015, and propose PFPM 
criteria in this rule, section II.F.10.c. of this proposed rule.
    Section 1868(c)(2)(B) of the Act specifies that stakeholders may 
submit proposals to the PTAC on an ongoing basis for PFPMs that they 
believe meet the PFPM criteria established by the Secretary. We 
recognize this statutory directive, but do not propose to define 
``ongoing basis'' because we believe that the process for submitting 
proposals to the PTAC should be determined by the PTAC.
    Section 1868(c)(2)(C) of the Act requires the PTAC to review 
stakeholders' proposed PFPMs, prepare comments and recommendations 
regarding whether such PFPMS meet the PFPM criteria established by the 
Secretary, and submit those comments and recommendations to the 
Secretary.
    The PTAC, established under section 1868(c)(1)(A) of the Act, is an 
independent committee comprised of 11 members. As required under 
section 1868(c)(1)(B) of the Act, the initial appointments to the PTAC 
were made by the Comptroller General of the United States on October 9, 
2015. The terms of the first appointed members of the PTAC are intended 
to be staggered, with the first set of appointments for terms of 1, 2, 
or 3 years. After the initial appointments, all subsequent appointments 
would be for terms of 3 years. PTAC members who were among the initial 
appointments may be reappointed for subsequent 3-year terms. There are 
no limitations for how many terms a PTAC member may serve. No end date 
for the PTAC is specified. Section 1868(c)(1)(B)(ii) and (iii) of the 
Act state that no more than 5 members of the PTAC shall be providers of 
services or suppliers, or representatives of providers of services or 
suppliers, and no member of the PTAC shall be an employee of the 
federal government. We received responses to the MIPS and APMs RFI 
recommending that CMS ensure that the PTAC is made up of varying ratios 
of professionals from particular backgrounds. We appreciate these 
responses; however, section 1868(c) of the Act specifies that the 
Comptroller General of the United States is to appoint members of the 
PTAC. Therefore, CMS does not have the authority to appoint members of 
the PTAC.
    Section 1868(c)(2)(D) of the Act requires the Secretary to review 
the PTAC's comments and recommendations on proposed PFPMs and to post 
``a detailed response'' to those comments and recommendations on the 
CMS Web site. We received comments on the MIPS and APMs RFI requesting 
that we review PFPM proposals from stakeholders before they are 
submitted to the PTAC. We also received comments on the MIPS and APMs 
RFI requesting that the PTAC review PFPM proposals under development by 
stakeholders before they are formally submitted to the PTAC. Section 
1868(c) of the Act does not require either the PTAC or the Secretary to 
evaluate proposed PFPMs prior to their submission to the PTAC,

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nor does it require the Secretary to review and respond to proposed 
PFPMs that are not reviewed by the PTAC. The PTAC would determine 
whether and how it may provide feedback on proposed PFPMs. In addition, 
we do not propose to evaluate PFPM proposals prior to their submission 
to the PTAC because it might interfere with the PTAC's independent 
review process.
    We also received responses to the MIPS and APMs RFI recommending 
that all proposed PFPMs that the PTAC recommends to the Secretary 
should be tested by us. Without being able to predict the volume, 
quality, or appropriateness of the PFPMs that the PTAC would recommend, 
we are not in a position to propose a commitment to test all such 
models. Section 1868(c) of the Act does not require us to test models 
that are recommended by the PTAC and given a favorable response by the 
Secretary. However, this does not imply that we would not give serious 
consideration to proposed PFPMs recommended by the PTAC. The PTAC 
serves an important advisory role in the implementation of APMs, but 
there are additional considerations that must be made by the Secretary 
beyond what is provided by the PTAC, such as competing priorities and 
available resources. We believe that this flexibility is important 
because the Secretary, and CMS through its delegated authority to test 
APMs, must retain the ability to make final decisions on which models 
to test and when, based on multiple factors including those that the 
Innovation Center currently uses to determine which payment models to 
test as described in section II.F.10.d. of this proposed rule.
    While we would consider these factors separately from the PTAC's 
review process, the decision to test a model recommended by the PTAC 
would not require a second application process to us as speculated by 
some commenters on the MIPS and APMs RFI; we would review the proposal 
submitted to the PTAC along with comments from the PTAC, and any other 
resources we believe would be useful. Proposed PFPMs that the PTAC 
recommends to the Secretary but that are not immediately tested by us 
may be considered for testing at a later time. We would continue to 
test PFPMs that are developed within CMS.
(2) Deadlines for the Duties of the Secretary, the PTAC, and CMS
    We received multiple responses to the MIPS and APMs RFI 
recommending that we establish deadlines for the PTAC's comments and 
recommendations on proposed PFPMs, the Secretary's response to the 
PTAC's comments and recommendations, and our testing of PFPMs. We do 
not propose to set deadlines for these tasks through regulations. We 
believe that setting a deadline for the PTAC's comments and 
recommendations would interfere with the PTAC's freedom to govern 
itself and develop its own process and timeline for reviewing proposed 
PFPMs. We wish to preserve the PTAC's independence and to give it the 
freedom to determine how and when it would review proposed PFPMs 
without rulemaking.
    We believe that setting a deadline through rulemaking for the 
Secretary's review of the PTAC's comments and recommendations, 
publication of a response to them, and our potential testing of a 
proposed PFPM submitted to the PTAC is inappropriate because these 
tasks would take varying amounts of time depending on factors that we 
cannot predict. Proposed PFPMs may be submitted to the PTAC on ``an 
ongoing basis'' in accordance with section 1868(c)(2)(B) of the Act, 
and given that there may be variation in the number and frequency of 
proposals, setting a deadline would be difficult. We do not believe we 
can effectively set deadlines because we do not know how many PFPM 
proposals the PTAC would receive. The Secretary would need varying 
lengths of time to review, comment on, and respond to PFPM proposals 
depending on the volume and nature of each proposal.
    We do not believe it would be reasonable to require us to adhere to 
a deadline in deciding whether to test a particular proposed PFPM. It 
is important for us to retain the flexibility to test models when it 
believes that it is the right time to do so, taking into account the 
other models it is currently testing, any potential design changes to 
the proposed PFPM, interactions with other our policies, and resource 
allocation. APMs generally take 18 months for us to develop, although 
the period of development may vary in length significantly, making a 
deadline difficult to establish.
    We received comments on the MIPS and APMs RFI suggesting that that 
any proposed PFPM approved by the PTAC should be available immediately 
for participant enrollment, and that participant enrollment should 
continue on an ongoing basis. We believe that setting deadlines for 
testing proposed PFPMs that we decide to test would be inappropriate. 
Entities need time to complete applications for voluntary models and we 
need time to review applications and prepare participation agreements 
for entities to sign. Entities need time to review these participation 
agreements and to begin planning for implementation of the model. To 
maintain rigorous evaluation of model outcomes, we also need time to 
build the necessary model infrastructure for such functions as quality 
measurement, financial calculations, and payment disbursements, and to 
coordinate with other payers if they are included in the model's 
design.
    We believe that proposed PFPMs that meet all of the proposed 
criteria may need less time to go through the development process; 
however, we cannot guarantee that the development process would be 
shortened, or estimate by how much it would be shortened. These 
processes depend on the nature of the PFPM's design and any attempt to 
impose a deadline on them would not benefit stakeholders because it 
would not allow us to tailor its review and development process to the 
needs of the proposed PFPM.
b. Definition of PFPM
(1) Proposed Definition of PFPM
    Section 1868(c) of the Act does not define the term ``physician-
focused payment model'' (PFPM). In Sec.  414.1465, we are proposing to 
add the following definition of PFPM: An Alternative Payment Model 
wherein Medicare is a payer, which includes physician group practices 
(PGPs) or individual physicians as APM Entities and targets the quality 
and costs of physician services. We propose to require a PFPM to target 
physician services. To address physician services, proposed PFPMs may 
address such elements as physician behavior or clinical decision-
making. APM Entities may be individual eligible clinicians, physician 
group practices (PGPs), or other entities, depending on the payment 
model's design. Therefore a PFPM must focus on physician services and 
contain either individual physicians or PGPs as APM Entities, although 
it may also include facilities or other practitioner types.
    We propose to require that PFPMs be designed to be tested as APMs 
with Medicare as a payer. Other Payer APMs would therefore not be 
PFPMs. We believe this is an appropriate standard for PFPMs because the 
Secretary is interested in reviewing comments and recommendations from 
the PTAC on models that may be tested with Medicare as a payer and 
because this provision is in section 1868 of the Act, and title XVIII 
of the Act governs Medicare. A PFPM may include other payers in 
addition to Medicare under the proposed definition. We believe this 
definition is appropriate because it

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would include APMs with arms of their design that would include other 
payers beyond Medicare, but would not include models that are only 
Other Payer APMs.
    We received many responses to the MIPS and APMs RFI regarding the 
proposed definition of PFPMs. These recommendations ranged from 
broadening the definition to include any payment model that alters 
payment for particular programs or populations to restricting the 
definition to specialist physicians only. We also received responses to 
the MIPS and APMs RFI recommending the definition of PFPM be broadened 
to include other care providers in the definition, such as nurses. We 
did not accept these suggestions because we believe that a payment 
model that does not specifically include individual physicians or PGPs 
would not appropriately be termed physician-focused. While we agree 
that there is merit in allowing other practitioners and facilities to 
be included in proposed PFPMs, we do not agree that changing the 
definition to explicitly include additional care providers or 
broadening the definition such that physicians or PGPs might not be 
included would satisfy the statutory directives under section 1868(c) 
of the Act that promote the development of PFPMs. Defining PFPM to 
allow the inclusion of other entities and additional targets gives 
stakeholders more flexibility in their proposals and may lead to models 
that promote broader participation in PFPMs, greater potential for care 
redesign, and greater potential for cost reduction.
    We do not propose to limit a PFPM to exclusively targeting 
physicians and physician services because we believe that stakeholders 
should be able to propose payment models that include additional types 
of entities, as well as additional services. We do not propose to 
define PFPM as a payment model that exclusively addresses Medicare FFS 
payments. A proposed PFPM may also include other payers in addition to 
Medicare, including Medicaid, Medicare Advantage, CHIP, and private 
payers, which may promote broader participation in PFPMs and greater 
potential for cost reduction. If tested as an APM, a PFPM that includes 
payers in addition to Medicare would include an Other Payer APM as part 
of its design in addition to an APM.
(2) Relationship Between PFPMs and Advanced APMs
    Section 1868(c) of the Act does not require PFPMs to meet the 
criteria to be an Advanced APM for purposes of the incentives for 
participation in Advanced APMs under section 1833(z) of the Act, and we 
do not propose to define PFPMs solely as Advanced APMs. Stakeholders 
may therefore propose either Advanced APMs or other PFPMs that might 
lead to better care for patients, better health for our communities, 
and lower health care spending. We received responses to the MIPS and 
APMs RFI recommending that all proposed PFPMs selected for testing by 
us should be Advanced APMs without needing to meet the additional 
criteria for Advanced APMs. Section 1833(z)(3)(C) and (D) of the Act 
makes a clear distinction between APMs and Advanced APMs and we do not 
believe the statutory requirements for Advanced APMs can or should be 
waived for proposed PFPMs.
    We recognize that both stakeholders and the PTAC may want to 
discuss in their proposals, comments, and recommendations, 
respectively, whether a proposed PFPM would be an Advanced APM. 
Therefore, we recommend that stakeholders provide information in their 
proposal about whether their proposed PFPM might be an Advanced APM as 
described in section II.F.4 of this proposed rule.
c. Proposed PFPM Criteria
    Section 1868(c)(2)(A) of the Act requires the Secretary to 
establish PFPM criteria for PFPMs, including models for specialist 
physicians, not later than November 1, 2016. The PFPM criteria would be 
used by the PTAC to make comments and recommendations on proposed PFPMs 
to the Secretary. The proposed PFPM criteria are listed in section 
II.F.10.c.(1) of this rule, and at proposed Sec.  414.1465(b). We have 
designed these criteria so that they are broad enough to encompass all 
physician specialties and provide stakeholders with flexibility in 
designing PFPMs.
    We propose PFPM criteria organized into three categories that are 
consistent with the Administration's strategic goals for achieving 
better care, smarter spending and healthier people: Payment incentives; 
care delivery; and information availability. First, we propose a 
category of criteria that promote payment incentives for higher-value 
care, including paying for value over volume and providing resources 
and flexibility necessary for practitioners to deliver high-quality 
health care.
    To address paying for value over volume, we propose a criterion 
that PFPMs should provide incentives to practitioners to deliver high-
quality health care. We believe that the correct incentives are 
necessary to drive change to improve quality of care. To address this 
criterion, the PTAC may request or stakeholders may wish to provide 
information about specific incentives in the proposed PFPM and how they 
are expected to incentivize quality, or information about any 
adjustments to payments to APM Entities based on quality performance. 
Similarly, we believe that it is important for a PFPM to provide 
sufficient flexibility for practitioners to deliver high-quality care. 
Flexibility relates to operational feasibility, the PFPM's ability to 
adapt to accommodate clinical differences in patient subgroups, and the 
APM Entity's ability to respond to changes in healthcare. To address 
this criterion, the PTAC may request or stakeholders may wish to 
provide information about how feasible it would be for APM Entities in 
the PFPM to deliver high-quality care as defined by the PFPM, and how 
the model design facilitates and encourages delivery of high-value care 
with respect to the dynamic and evolving nature of healthcare. In 
addition, the PTAC may request or stakeholders may wish to provide 
information about how the proposed PFPM can adapt to accommodate 
clinical differences in patient subgroups, and how it can adapt to 
account for changing technology, including new drug therapies.
    This category of criteria also aligns with the Innovation Center's 
statutory authority under section 1115A of the Act to test models aimed 
to improve care, reduce cost, or achieve both of these goals, by 
proposing a criterion that assesses to what extent a PFPM proposal is 
expected to achieve these goals. To address this criterion, the PTAC 
may request or stakeholders may wish to provide information about 
specific quality measures included in the PFPM's design, including any 
prior validation of those measures, and whether any of those measures 
are patient reported outcome measures or measurements of beneficiary 
experience of care. We believe estimates of any cost reduction under 
the PFPM to the most precise extent possible would also be useful in 
addressing this criterion.
    We propose a criterion that the PFPM proposal must pay APM Entities 
under a payment methodology that furthers the PFPM Criteria. The 
payment methodology must address how it is different from current 
Medicare payment methodologies, and why the payment methodology cannot 
be tested under current payment methodologies. We believe it is 
necessary for PFPM proposals to contain such a payment methodology 
because the PTAC is tasked with reviewing payment models and therefore 
cannot evaluate a proposal

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without knowing the payment methodology. We believe that the more 
robust the description of the payment methodology is, the easier it 
would be for the PTAC to evaluate the impact of the proposed PFPM. In 
addition, including information about how the proposed PFPM differs 
from current methodologies and why it cannot be tested under them would 
allow the PTAC and the Secretary to evaluate how the proposed PFPM 
could improve on existing methodologies. It is important for the PFPM 
proposal to describe how the payment methodology is different from 
current Medicare payment methodologies to show how the PFPM would test 
differences in payment and their effect on paying for value over 
volume. It would also help the PTAC and the Secretary to understand why 
the PFPM would be a significant enough departure that an APM would be 
required to test it. We recommend that stakeholders include a thorough 
description of the payment methodology. To be robust, the description 
of a payment methodology should include the amount of any new payments 
to proposed APM Entities, such as per beneficiary per month payments, 
performance-based payments, or shared savings payments. It should also 
include a methodology for calculation of these payments. It should 
include information about whether the proposed PFPM could include other 
payers in addition to Medicare, and if so, the payment methodology 
proposed for those payers. The payment methodology description should 
also include information about the use of any payment methods such as 
bundled payments or capitated payments and a description of the type 
and degree of financial performance risk assumed by APM Entities. We 
received comments in response to the RFI suggesting that we accept 
proposed PFPMs that have different payment methodologies from current 
APMs such as ACOs and bundled payments. We welcome completely new and 
innovative ideas for payment methodologies that can improve care while 
reducing cost.
    We also propose to include in the first category a criterion that 
the PFPM must either aim to solve an issue in payment policy not 
addressed in the CMS APM portfolio at the time it is proposed or 
include in its design APM Entities who have had limited opportunities 
to participate in APMs. We believe this criterion would promote 
participation in APMs by broadening and expanding our portfolio of APMs 
in areas such as geographic location, specialty, condition, and 
illness, without overly limiting proposed PFPMs. We believe that 
because proposed PFPMs may satisfy this criterion by either addressing 
a new issue or including a new specialty, the criterion is sufficiently 
broad to allow stakeholders to submit many proposed PFPMs that could 
expand the CMS APM portfolio. Physicians and practitioners whose 
opportunities to participate in other PFPMs with us have been limited 
to date include, for example, those who have not been able to apply for 
any other PFPM because one has not been designed that would include 
physicians and practitioners of their specialty. We propose that a 
proposed PFPM that includes multiple specialties may meet the PFPM 
criteria where a minimum of one of the specialties in the proposed PFPM 
is not currently being addressed by another APM. We believe this 
reflects the intent of section 1868(c)(2)(A)(i) of the Act which 
specifically directs the Secretary to establish PFPM criteria, 
including models for specialist physicians.
    We also propose a criterion that a PFPM proposal must have 
evaluable goals for the impact of cost and quality under the PFPM. To 
make the decision to expand an APM under section 1115A(c) of the Act, 
the Secretary must evaluate the model's success. This standard informed 
our proposed criterion not only because it would be important for any 
APMs that are tested under section 1115A(c) of the Act, but also 
because it is necessary for measuring the success of any APM that it be 
evaluable. It is the evaluation of an APM that tells us whether the APM 
is successful in reducing cost or improving quality. We believe that 
the more detailed the information regarding how the impact of a 
proposed PFPM would be evaluated, the easier it would be for the PTAC 
to evaluate the impact of the proposed PFPM in terms of potential 
expansion, as well as in terms of incentivizing high quality care and 
reducing costs. To address this criterion, the PTAC may request or 
stakeholders may wish to provide information about potential approaches 
for evaluation including evaluation study design, comparison groups, 
key outcome measures, the level of precision the evaluation may reach, 
and the extent that the impact of each element of the PFPM can be 
evaluated.
    Second, we propose a category of criteria that address care 
delivery improvements that promote better care. Here we propose 
criteria to address integration and care coordination, patient choice, 
and patient safety. To address these criteria, the PTAC may request or 
stakeholders may wish to provide information about how the payment 
model would affect access to care for Medicare beneficiaries, including 
an explanation of how the payment model would not reduce benefits for 
Medicare beneficiaries, limit coverage for beneficiaries, how the 
payment model would affect disparities among Medicare beneficiaries by 
race, ethnicity, gender, disability, and geography, and what measures 
may be used to measure the provision of necessary care and monitor for 
any potential stinting of care. The PTAC may also request or 
stakeholders may wish to provide information about how patient choice 
is preserved under the model by accommodating individual differences in 
patient characteristics, conditions, and health-related preferences 
while furthering population health outcomes.
    Third, we propose a category of criteria that address information 
enhancements that improve the availability of information to guide 
decision-making. We believe that information enhancements, particularly 
through use of technology are important to improving Medicare payment 
policy and delivering better care. Here we propose a criterion for 
encouraging use of health information technology. In addition, we 
recommend that stakeholders include information about any information 
enhancements that encourage transparency concerning cost and quality of 
care to patients and other stakeholders. To address these criteria, the 
PTAC may request or stakeholders may wish to provide information about 
how the payment model could increase transparency, or how the payment 
model could incorporate certified EHR technology.
    In carrying out its review of PFPM proposals, the PTAC shall assess 
whether the PFPM meets the following criteria for PFPMs sought by the 
Secretary. The Secretary seeks PFPMs that:
    (1) Incentives: Pay for higher-value care.
     Value over volume: Provide incentives to practitioners to 
deliver high-quality health care.
     Flexibility: Provide the flexibility needed for 
practitioners to deliver high-quality health care.
     Quality and Cost: Are anticipated to improve health care 
quality at no additional cost, maintain health care quality while 
decreasing cost, or both improve health care quality and decrease cost.
     Payment methodology: Pays APM Entities with a payment 
methodology designed to achieve the goals of the PFPM Criteria. 
Addresses in detail

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through this methodology how Medicare, and other payers if applicable, 
pay APM Entities, how the payment methodology differs from current 
payment methodologies, and why the Physician-Focused Payment Model 
cannot be tested under current payment methodologies.
     Scope: Aim to either directly address an issue in payment 
policy that broadens and expands the CMS APM portfolio or include APM 
entities whose opportunities to participate in APMs have been limited.
     Ability to be evaluated: Have evaluable goals for quality 
of care, cost, and any other goals of the Physician-focused Payment 
Model.
    (2) Care delivery improvements: Promote better care coordination, 
protect patient safety, and encourage patient engagement.
     Integration and Care Coordination: Encourage greater 
integration and care coordination among practitioners and across 
settings where multiple practitioners or settings are relevant to 
delivering care to the population treated under the Physician-Focused 
Payment Model.
     Patient Choice: Encourage greater attention to the health 
of the population served while also supporting the unique needs and 
preferences of individual patients.
     Patient Safety: Aim to maintain or improve standards of 
patient safety.
    (3) Information Enhancements: Improving the availability of 
information to guide decision-making.
     Health Information Technology: encourage use of health 
information technology to inform care.
d. Facilitating CMS Consideration of Models Recommended by the PTAC
    In order to facilitate and potentially expedite the consideration 
of models for our testing following PTAC review and recommendation, we 
suggest ``supplemental information elements'' stakeholders may include 
in their PFPM proposals to assist our review. We do not propose to 
require these elements as PFPM criteria and defer to the PTAC on how it 
may approach requesting any supplemental information beyond that 
required to meet the PFPM criteria.
(1) Background on Factors Used To Evaluate Potential Innovation Center 
Models
    Section 1115A of the Act authorizes the Innovation Center to test 
innovative payment and service delivery models. We have an established 
process by which it routinely assesses proposals for new models. Many 
factors are typically used in the selection of models to be tested, and 
can be viewed on the Innovation Center Web site at https://innovation.cms.gov/Files/x/rfi-Websitepreamble.pdf.
(2) Why and How These Factors Informed the Supplemental Information 
Elements for PFPM Proposals
    These factors address a variety of details in an APM's design. 
Examining these factors helps us to answer important questions that 
inform its decision whether to test a payment model. They provide 
necessary insight about how a potential APM would fit within our 
current CMS APM portfolio, including information such as the scope of 
its impact, likelihood of success, how many practitioners and 
beneficiaries it would impact, whether those potential outcomes merit 
the required investments and opportunity costs, and whether the impact 
of the payment model can be measured to determine if it should be 
expanded. We believe that to the extent stakeholders develop PFPM 
proposals that address the factors used by us in evaluating payment 
model designs, they would increase the probability that PTAC 
recommendations would be positive and might lead us to test the 
proposed PFPMs.
    We considered each factor currently used by us when we developed 
the suggested supplemental information elements for PFPM submission. We 
balanced the burden these expectations would place on stakeholders in 
developing their proposed PFPMs with the value this information would 
provide to the PTAC in its review of the proposed PFPMs and to us in 
our decision whether or not to test a proposed PFPM. We acknowledge 
that the factors used by us may change in the future and we believe 
that the PFPM criteria we have proposed are sufficiently broad and 
relevant to our evaluation of the testing of models that they would 
align with any future changes in our factors. While we believe that the 
more detail concerning these factors the stakeholder can provide the 
more it would facilitate our review, we have determined that certain 
factors are of particular importance.
    We also chose not to include certain of these factors, including 
the size of investment required and waiver authority, in the suggested 
supplemental information elements because we believe the burden to 
evaluate how these factors apply to potential APMs should be on us, not 
stakeholders. For example, we received responses to the RFI both in 
favor of, and opposed to requiring information about whether, if the 
proposed PFPM cannot be implemented under existing law, we have the 
authority to waive any laws or regulations for purposes of testing the 
payment model. We decided it would be inappropriate to require 
stakeholders to speculate as to the scope of our waiver authority in 
their proposals. We and other components of HHS are responsible for 
interpreting the relevant laws and regulations, and for designing and 
issuing any potential waivers. We also decided not to include as a 
supplemental information element the size of investment for proposed 
PFPMs because we do not believe stakeholders would have the necessary 
information about our operational costs to include in a PFPM proposal.
(3) Supplemental Information Elements Considered Essential to CMS 
Consideration of New Models
    There are three pieces of information we consider fundamental to 
evaluating new models. First, the anticipated size and scope of a 
proposed PFPM is essential. For example, any proposed PFPM should 
describe the estimated number of Medicare beneficiaries that would be 
affected by the model, the number and scope of eligible clinicians 
expected to participate, including eligible clinician specialty(s), the 
potential geographic location(s) included in the model, the defined 
period of performance or clinical episode(s) of care in the model, and 
the number and quality of services that would be affected by the model. 
A definition of the target population and any criteria for including or 
excluding patients from the model would also be useful in addressing 
the scope of the PFPM. We believe this information is vital to 
evaluating a proposed PFPM. Second, we also consider an estimate of the 
burden in terms of morbidity and mortality on a population to be 
relevant in describing the scope of physician services addressed by the 
model. For example, stakeholders could provide estimates of morbidity 
and mortality from peer-reviewed publications and analyses of health 
care data such as Medicare or Medicaid data. Third, we believe an 
explanation of how a proposed model would be attractive to participate 
in and feasible to implement for potential APM Entities from a 
financial perspective is necessary for us to evaluate a proposed model.
    To summarize, the following specific supplemental information 
elements are considered essential:
     A description of the anticipated size and scope of the 
model in terms of eligible clinicians, beneficiaries, and services.

[[Page 28350]]

     A description of the burden of disease, illness or 
disability on the target patient population.
     An assessment of the financial opportunity for APM 
Entities, including a business case for how their participation in the 
model could be more beneficial to them than participation in 
traditional fee-for-service Medicare.
    In addition, we recommend that proposed PFPMs submitted to the PTAC 
include information about whether the stakeholder or individual 
submitting the proposal believes it would meet the criteria to be an 
Advanced APM, discussed in section II.F.4. of this proposed rule. This 
information would allow us to evaluate whether the proposed PFPM would 
provide eligible clinicians with an opportunity to become QPs for 
purposes of the incentives for participation in Advanced APMs. We are 
interested in receiving proposed PFPMs from stakeholders that would be 
Advanced APMs and we received comments on the RFI stating that 
stakeholders would like this opportunity as well. As discussed in 
section II.F.10.b. of this proposed rule, we do not believe that it is 
necessary to limit stakeholders' proposed PFPMs to only those that 
would be Advanced APMs, but believe that it is useful for proposed 
PFPMs to state whether, if tested by us, they would be Advanced APMs.
e. MIPS and APMs RFI Comments on PFPM Criteria
    We received multiple responses to the MIPS and APMs RFI 
recommending that the Secretary include specialty-specific criteria to 
be used by the PTAC. We appreciate the interest from multiple 
specialties and encourage them to submit proposed PFPMs for review by 
the PTAC, but do not believe that we should limit proposed PFPMs by 
adding specialty-specific criteria.
    We received multiple comments suggesting prioritization of certain 
patient groups, physician specialties, diseases, and other issues. We 
believe that the aim of section 1868(c) of the Act to promote 
development of PFPMs is best satisfied by not prioritizing certain 
specialties or issues over others in the PFPM criteria. However, the 
PTAC may decide to prioritize specific patient groups, specialties, or 
issues in its comments and recommendations.
    We received several responses to the MIPS and APMs RFI recommending 
that types of physicians and practitioners that have had the 
opportunity to participate in previous APMs should not be excluded from 
future proposals for PFPMs because current or previous APMs are not 
exhaustive of all possible APMs for any given specialty or issue. We 
agree with this recommendation, so long as the proposed PFPM instead 
aims to solve an issue in payment policy that broadens and expands the 
CMS APM portfolio at the time it is tested as stated in section 
II.F.10.c. of this proposed rule. We believe this best serves our goal 
of expanding and diversifying our portfolio of APMs. We believe that 
concurrently implementing multiple PFPMs that attempt to solve the same 
clinical or payment issue may not be the most efficient use of limited 
resources, and may complicate the evaluations of some or all of the 
relevant models. However, we would consider a proposed PFPM that 
focuses on an issue addressed in a model that we are no longer testing, 
even if that prior model was unsuccessful.
    We also received responses to the MIPS and APMs RFI recommending 
that we should consider proposals that modify or extend the testing of 
existing models. We do not believe that the PTAC is the proper forum 
for considering modifications or extensions of current models. We also 
note that our legal authority to modify or extend existing models is 
contingent on other criteria that are unrelated to the criteria for 
proposed PFPMs. Stakeholders who wish to discuss changes to models that 
we are currently testing may discuss them with us directly, outside of 
the PTAC review process.
    We received many comments suggesting payment for high-value 
services that we do not currently (or separately) reimburse as examples 
of potential PFPMs. These types of changes are an important part of 
moving toward value-based delivery system reform, but adding payment 
for specific services without any other change does not constitute a 
sufficient departure from current payment methodologies to meet our 
proposed PFPM criteria or to be considered an APM, and could be better 
achieved outside of the PTAC process. We do however welcome these 
suggestions within the context of broader model proposals.
    We received responses to the MIPS and APMs RFI recommending that in 
addition to criteria about how the proposed PFPM would either fit in to 
or replace the existing Medicare payment system, there should also be 
criteria to identify specific barriers to care improvement that exist 
in the current payment system. We believe that information about how 
the proposed PFPM changes or fits into existing payment systems is 
essential to understanding how the proposed PFPM operates. We believe 
information about existing barriers to improving care and reducing 
costs and how the proposed PFPM addresses those barriers is also 
important. Therefore, we encourage stakeholders to include this 
information in their proposals although we do not propose to require 
it.
    We received many responses to the MIPS and APMs RFI recommending 
that the PFPM criteria include specific quality measures and 
guidelines, such as those set by the Core Quality Measures 
Collaborative. We do not believe it would be appropriate to limit 
proposed PFPMs to include specific quality measures. We encourage 
stakeholders to propose quality measures that are tailored to their 
particular proposed PFPM. We also received responses to the MIPS and 
APMs RFI recommending we should not include criteria requiring 
information on the impact that the proposed PFPM would have on quality 
of care. We understand that the full scope of the potential impact a 
proposed PFPM may have on quality of care and cost reduction might not 
be known at the time of submission. However, we believe proposed PFPMs 
should provide realistic assessments and estimates of the impacts, as 
well as information to justify these estimates. Commentators also 
voiced opinions about the utilization of Clinical Data Registries 
managed by specialty societies or other groups. We believe that this 
information, if applicable, should be included in the PFPM proposal as 
an aspect of CEHRT use.
    Finally, we received many responses to the MIPS and APMs RFI 
offering proposed PFPMs that we should implement. We appreciate the 
interest in PFPMs and encourage these commenters to submit their 
proposed PFPMs to the PTAC.

III. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 60-day notice in the Federal Register and solicit public 
comment before a collection of information requirement is submitted to 
the Office of Management and Budget (OMB) for review and approval. In 
order to fairly evaluate whether an information collection should be 
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act 
of 1995 requires that we solicit comment on the following issues:
     The need for the information collection and its usefulness 
in carrying out the proper functions of our agency.
     The accuracy of our estimate of the information collection 
burden.

[[Page 28351]]

     The quality, utility, and clarity of the information to be 
collected.
     Recommendations to minimize the information collection 
burden on the affected public, including automated collection 
techniques.
    We are soliciting public comment on each of these issues for the 
following sections of this document that contain information collection 
requirements (ICRs).

A. Wage Estimates

    To derive wage estimates, we used data from the U.S. Bureau of 
Labor Statistics' May 2014 National Occupational Employment and Wage 
Estimates and the December 2015 Employer Costs for Employee 
Compensation. In this regard, Table 46 presents the mean hourly wage, 
the cost of fringe benefits and overhead, and the adjusted hourly wages 
for Billing and Posting Clerks, Computer Systems Analysts, and 
Physicians. We are adjusting our employee hourly wage estimates by a 
factor of 100 percent to reflect current HHS department-wide guidance 
on estimating the cost of time spent by employees of regulated 
entities. These are necessarily rough adjustments, both because fringe 
benefits and overhead costs vary significantly from employer to 
employer, and because methods of estimating these costs vary widely 
from study to study. Nonetheless, there is no practical alternative and 
we believe that these are reasonable estimation methods. In addition, 
in order to calculate the costs to beneficiaries for their time, we 
have used Bureau of Labor Statistics (BLS) estimates for Civilian, all 
occupations. We have not adjusted these costs for fringe benefits and 
overhead because only the direct wage costs represent the ``opportunity 
cost'' to beneficiaries themselves for time spent in health care 
settings.
[GRAPHIC] [TIFF OMITTED] TP09MY16.055

B. A Framework for Understanding the Burden of MIPS Data Submission

    Because the entities permitted to submit MIPS data on behalf of 
eligible clinicians will vary based on APM participation and the type 
of data, Table 47 presents a framework for understanding the entities 
facing the burden of MIPS data submission. As shown in the first row of 
Table 47, eligible clinicians that are not in APMs will submit data 
either as individuals or groups to the quality, advancing care 
information, and CPIA performance categories.\19\
---------------------------------------------------------------------------

    \19\ Eligible clinicians will not be required to submit data for 
the resource use performance category. Resource use measures will be 
calculated using administrative claims data.
---------------------------------------------------------------------------

    For APMs, the entities submitting data on behalf of model 
participants will vary across categories of data and APM Model. When 
APM Entities submit quality data to fulfill the requirements of their 
APMs, the burden will be ascribed to their APMs, and will not 
contribute to the MIPS data submission burden.\20\ Many APM 
participants will be scored on advancing care information and CPIA 
performance categories, and the submitting entity for those categories 
differs between the Shared Savings Program and other APMs. For the 
Shared Savings Program, billing TINs (or groups) will submit advancing 
care information and CPIA performance category data on behalf of model 
participants.\21\ In other APMs, eligible clinicians will submit data 
as individuals to the advancing care information and CPIA performance 
categories. For Advanced APMs, Partial Qualifying APM Participant 
(Partial QP) elections (which will be discussed in more detail in 
Section I below) will be submitted by the Advanced APM Entity on behalf 
of all its participating eligible clinicians.
---------------------------------------------------------------------------

    \20\ The quality data that APM participants or Entities submit 
to fulfill the requirements of their models are not subject to the 
requirements of the Paperwork Reduction Act. Sections 3021 and 3022 
of the Affordable Care Act exempt any collection of the information 
shared with the Shared Savings Program or Innovation Center APMs 
with the requirements of the Paperwork Reduction Act of 1995 (44 
U.S.C. 3501 et seq.)

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[[Page 28352]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.056

C. ICRs Regarding Quality Performance Reporting Category (Sec.  
414.1330 and Sec.  414.1335 and Section II.E.5.b of This Preamble) and 
Previously Approved Under PQRS

    This section discusses the information collection requirements for 
the eligible clinicians who are not APM participants because burden for 
APM Entities' submission of quality data to fulfill the requirements of 
their APMs will not be ascribed to MIPS.\22\ Based on historical data 
in the 2014 PQRS Experience Report, we estimate that up to 703,467 MIPS 
eligible clinicians will submit quality performance category data 
including those participating as groups. Because of the exclusion of 
QPs from our quality performance data burden estimates, our estimates 
of the number of eligible clinicians submitting MIPS quality data is 
lower than the estimate of 822,810 professionals that submitted quality 
data to the 2014 PQRS.\23\ We assume that clinicians not in APMs that 
reported quality data to PQRS in 2014 will continue to report quality 
data to MIPS. We assume that some of those clinicians will be 
submitting voluntarily because they are not required (but are allowed) 
to report quality data to MIPS because they are in specialties not 
required to participate in MIPS.
---------------------------------------------------------------------------

    \22\ For example, this burden estimate does not include CMS Web 
Interface or CAHPS data that will be submitted by Shared Savings 
Program and NextGen ACO Entities to fulfill the requirements of 
their models.
    \23\ See https://www.cms.gov/site-search/search-results.html?q=PQRS%20Experience%20Report. Our estimate of 703,467 
eligible clinicians that will submit quality performance category 
data as individuals or groups is the sum of the eligible clinicians 
submitting data in each of the different submission mechanisms. 
(703,467 = 299,169 + 214,590 + 77,241 + 112,467).
---------------------------------------------------------------------------

    We assume that the number of MIPS eligible clinicians who will 
submit through claims mechanisms (299,169), Qualified Registry or QCDR-
mechanisms (214,590), certified EHR technology mechanisms (77,241), and 
as groups through CMS Web Interface (112,467) will be the same as the 
numbers submitting data through those mechanisms under the 2014 
PQRS.\24\

[[Page 28353]]

We also assume that the number of groups that will submit quality 
performance category data through the CMS Web Interface will be the 
same as the number submitting PQRS data through the GRPO Web Interface 
in 2014 (300 groups submitting on behalf of 112,467 MIPS eligible 
clinicians). Historically, the PQRS has never experienced 100 percent 
participation; the participation rate for 2014 was 63 percent.
---------------------------------------------------------------------------

    \24\ The most recently available counts of eligible clinicians 
submitting to PQRS are from 2014.
---------------------------------------------------------------------------

    For MIPS eligible clinicians or groups, the burden associated with 
the requirements of the MIPS quality performance category is the time 
and effort associated with MIPS eligible clinicians identifying 
applicable quality measures for which they can report the necessary 
information, collecting the necessary information, and reporting the 
information needed to submit the MIPS eligible clinician's measures. We 
believe it is difficult to quantify the burden accurately because MIPS 
eligible clinicians and groups may have different processes for 
integrating quality reporting into their practices' work flows. 
Moreover, the time needed for an MIPS eligible clinician to review the 
quality measures and other information, select measures applicable to 
his or her patients and the services he or she furnishes to them, and 
incorporate the use of quality data codes into the office work flows is 
expected to vary, along with the number of measures that are 
potentially applicable to a given professional's practice.
    For MIPS eligible clinicians and groups, we estimate a total of 6 
hours as the amount of time needed for an MIPS eligible clinician's 
billing clerk to review the quality measures list, review the various 
submission options, select the most appropriate submission option, 
identify the applicable measures or specialty measure sets for which 
they can report the necessary information, review the measure 
specifications for the selected measures or measures groups, and 
incorporate submission of the selected measures or specialty measure 
sets into the office work flows. The measures list contains the measure 
title and brief summary information for the MIPS eligible clinician's 
billing clerk to review. The 6 hour estimate for the billing clerk is 
comprised of reviewing the performance criteria (up to 2 hours) and 
reviewing measure specifications (up to 4 hours). Assuming the MIPS 
eligible clinician has received no training from his/her specialty 
society, we estimate it will take an MIPS eligible clinician's billing 
clerk up to 2 hours to review this list, review the submission method, 
and select a submission method and measures on which to report. If an 
MIPS eligible clinician has received training, then we believe this 
would take less time. We believe 4 hours is a reasonable estimate for 
an MIPS eligible clinician's billing clerk to review the measure 
specifications of measures they select to report and to develop a 
mechanism for incorporating submission of the selected measures or into 
the office work flows. Further, we estimate that it will take a 
physician up to 1 hour to review MIPS quality performance category 
measure specifications for each MIPS eligible clinician.\25\ Therefore, 
we believe that the start-up cost for a MIPS eligible clinician's 
billing clerk to report measures data may be calculated as: 6 hours x 
$34.20/hour = $205.20, and the start-up cost for a physician to review 
quality performance category measure specifications to be calculated as 
1 hour x $182.46/hour = $182.46.\26\ These start-up costs pertain to 
the specific quality submission methods below, and hence appear in the 
burden estimate table.\27\
---------------------------------------------------------------------------

    \25\ Lawrence P. Casalino et al, ``US Physician Practices Spend 
More than $15.4 Billion Annually to Report Quality Measures,'' 
Health Affairs, 35, no. 3 (2016): 401-406.
    \26\ Because MIPS has different reporting requirements than 
PQRS, the assumptions for the burden of startup costs of reporting 
are higher than they were under the most recently approved PQRS PRA 
package (OMB Control Number (OCN) 0938-105). The PQRS burden 
estimate was based on the assumption that startup costs involved 
five hours at a clerk's labor rate, and 0 hours of a physician's 
time.
    \27\ The one exception is the start-up cost for a billing clerk 
to submit data is not listed in the CMS Web Interface Reporting 
Burden.
---------------------------------------------------------------------------

    We believe the burden associated with actually submitting the 
quality measures will vary depending on the submission method selected 
by the MIPS eligible clinician. As such, we break down the burden 
estimates by MIPS eligible clinicians and groups according to the 
submission method used. The revised quality performance requirements 
and burden estimates will be submitted along with all other ICRs listed 
below under a new OMB control number (0938-NEW).
1. Burden for Quality Performance Category Reporting by MIPS Eligible 
Clinicians: Claims-Based Submission
    We anticipate the claims submission process for MIPS will be 
operationally similar as it was under the PQRS. MIPS eligible 
clinicians must gather the required information, select the appropriate 
quality data codes (QDCs), and include the appropriate QDCs on the 
claims they submit for payment. MIPS eligible clinicians will collect 
QDCs as additional (optional) line items on the CMS-1500 claim form or 
the electronic equivalent HIPAA transaction 837-P, approved by OMB 
under control number 0938-0999. This rule does not revise either of 
those forms. We note that the claims submission option is only 
available to individual MIPS eligible clinicians and is not available 
for groups.
    The total estimated burden will vary along with the volume of 
claims on which the quality data is reported. Based on our experience 
with the PQRS, we estimate that the burden for submission of quality 
data will range from 7.22 hours to 17.8 hours per MIPS eligible 
clinician. The wide range of estimates for the time required for a MIPS 
eligible clinician to submit quality measures via claims reflects the 
wide variation in complexity of submission across different clinician 
quality measures. As shown in Table 48 we also estimate that the cost 
of quality data submission will range from $18.47 (.22 hours x $83.96) 
to $906.77 (10.8 hours x $83.96). The total estimated annual cost per 
MIPS eligible clinician ranges from the minimum burden estimate of 
$406.13 to a maximum burden estimate of $1,294.43. The burden will 
involve becoming familiar with MIPS data submission requirements. 
Therefore, we believe that the start-up cost for a MIPS eligible 
clinician's billing clerk to report measures data may be calculated as: 
6 hours x $34.20/hour = $205.20, and the start-up cost for a physician 
to review quality performance category measure specifications to be 
calculated as 1 hour x $182.46/hour = $182.46. Therefore, total annual 
burden cost is estimated to range from a minimum burden estimate of 
$121,501,865 (299,169 x $406.13) to a maximum burden estimate of 
$387,252,730 (299,169 x $1294.43).
    Based on the assumptions discussed above, Table 48 summarizes the 
range of total annual burden associated with MIPS eligible clinicians 
using the claims submission mechanism.
---------------------------------------------------------------------------

    \28\ In Tables 47-56, the numbers have been truncated to two 
decimals for readability.

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[[Page 28354]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.057

2. Burden for Quality Performance Category Reporting by MIPS Eligible 
Clinicians and Groups Using Qualified Registry and QCDR Submissions
    For qualified registry and QCDR submissions, we estimate an 
additional time burden for MIPS eligible clinicians and groups to 
become familiar with MIPS submission requirements and, in some cases, 
new specialty measure sets. Therefore, we believe that the start-up 
cost for a MIPS eligible clinician's billing clerk to report measures 
data may be calculated as: 6 hours x $34.20/hour = $205.20, and the 
start-up cost for a physician to review quality performance category 
measure specifications to be calculated as 1 hour x $182.46/hour = 
$182.46. These start-up costs pertain to the specific quality 
submission methods below, and hence appear in the burden estimate 
table.
    Little, if any, additional data will need to be reported to the 
qualified registry or QCDR solely for purposes of participation in 
MIPS. However, MIPS eligible clinicians and groups will need to 
authorize or instruct the qualified registry or QCDR to submit quality 
measures results and numerator and denominator data on quality measures 
to CMS on their behalf. We estimate that the time and effort associated 
with this will be approximately 5 minutes (0.083 hours) per MIPs 
eligible clinician for a total burden cost of $6.97, at a computer 
systems analyst's labor rate. Hence, we estimated 10.083 burden hours 
per MIPS eligible clinician, with annual total burden hours of 
2,163,711 (10.083 burden hours x 214,590 MIPS eligible clinicians). The 
total estimated annual cost per MIPS eligible clinician is estimated to 
be approximately $646.51. Therefore, total annual burden cost is 
estimated to be $138,734,298 (214,590 x $646.51). Based on these burden 
requirements and the number of eligible clinicians historically using 
the Qualified Registry and QCDR

[[Page 28355]]

submissions, we have calculated a burden estimate for quality 
performance category reporting for these submissions:
[GRAPHIC] [TIFF OMITTED] TP09MY16.058

3. Burden for Quality Performance Category Reporting by Eligible 
Clinician and Groups: EHR Submission
    Based on our experience with the PQRS, we estimate that the time 
needed to perform all the steps necessary for MIPS eligible clinicians 
to report quality performance measures includes the time to prepare for 
participating in quality performance category submissions for MIPS 
(calculated at 6 hours plus 1 hour of physician time for reviewing 
specifications), and an additional 3 hours for data submission through 
an EHR.
    For EHR submission, the MIPS eligible clinician or group must 
review the quality measures on which we will be accepting MIPS data 
extracted from EHRs, select the appropriate quality measures, extract 
the necessary clinical data from his or her EHR, and submit the 
necessary data to the CMS-designated clinical data warehouse. To submit 
data to CMS directly from their EHRs, MIPS eligible clinicians must 
have access to a CMS-specified identity management system which we 
believe takes less than 1 hour to obtain. Once an MIPS eligible 
clinician has an account for this CMS-specified identity management 
system, he or she will need to extract the necessary clinical data from 
his or her EHR, and submit the necessary data to the CMS-designated 
clinical data warehouse. We estimate that obtaining a CMS-specified 
identity management system will require 1 hour per MIPS eligible 
clinician cost of $83.96 (1 x $83.96), and that submitting a test data 
file to CMS will also require 1 hour for a per MIPS eligible clinician 
for a cost of $83.96. With respect to submitting the actual data file 
for the respective reporting period, we believe that this will take an 
MIPS eligible clinician or group no more than 2 hours for a per MIPS 
eligible clinician cost of submission of $167.92 (2 x $83.96). The 
burden will involve becoming familiar with MIPS submission. In 
addition, we believe that the start-up cost for a MIPS eligible 
clinician's billing clerk to report measures data may be calculated as: 
6 hours x $34.20/hour = $205.20, and the start-up cost for a physician 
to review quality performance category measure specifications to be 
calculated as 1 hour x $182.46/hour = $182.46. Hence, we estimated 11 
burden hours per MIPS eligible clinician, with annual total burden 
hours of 849,651 (11 burden hours x 77,241 MIPS eligible clinicians). 
The total estimated annual cost per MIPS eligible clinician is 
estimated to be $723.50. Therefore, total annual burden cost is 
estimated to be $55,883,864 (77,241 x $723.50).
    Based on these burden requirements and the number of eligible 
clinicians historically using the EHR submission mechanism, we have 
calculated a burden estimate for quality performance category reporting 
for this submission mechanism:

[[Page 28356]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.059

4. Burden for Quality Performance Category Reporting for Groups Using 
the CMS Web Interface
    We estimate that 112,467 MIPS eligible clinicians submitting as 300 
groups will participate in MIPS using the CMS Web Interface in the 2017 
Performance Period. Groups interested in participating in the MIPS 
using the CMS Web Interface must complete a registration process. 
However, since a group using the CMS Web Interface would not need to 
determine which measures to report under MIPS, we believe that the 
registration process is handled by the group's administrative staff. We 
estimate that the registration process for groups under MIPS involves 
approximately 1 hour per group. We assume that the group staff involved 
in the group registration process has an average labor cost of $34.20 
per hour. Therefore, assuming the total burden hours per group 
associated with the group registration process is 1 hour, we estimate 
the total cost to a group associated with the group registration 
process to be approximately $34.20 ($34.20 per hour x 1 hour per 
group).
    The burden associated with the group submission requirements under 
the CMS Web Interface is the time and effort associated with the group 
submitting the quality measures data. For physician groups, this would 
be the time associated with the physician group completing the CMS Web 
Interface. We estimate that, on average, it will take each group 79 
hours to submit quality measures data via the CMS Web Interface at a 
cost of $83.96 per hour, for a total cost of $6,6632.84 (79 x $83.96). 
We also estimate that a physician for each group will need to spend 1 
hour per year to review quality performance measure specifications, for 
a total cost of $182.46. As mentioned above, we estimate it will take 1 
hour for a group to register to submit through the CMS Web Interface, 
for a total of cost of $34.20 (1 x $34.20). Therefore, the total 
estimated annual cost per group is estimated to be approximately 
$6,632.84. The total annual burden hours are estimated to be 24,300 
(300 eligible groups x 81 annual hours), and the total annual burden 
cost is estimated to be $2,052,850 (300 x $6,849.50).
    Based on the assumptions discussed above we have calculated the 
following burden estimate for groups submitting to MIPS with the CMS 
Web Interface.

[[Page 28357]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.060

D. ICRs Regarding Burden for Third Party Reporting and Data Validation 
(Sec.  414.1400 and Sec.  414.1390)

1. Burden for Qualified Registry and QCDR Self-Nomination \29\
---------------------------------------------------------------------------

    \29\ We do not anticipate any changes in the CEHRT process for 
health IT vendors as we transition to MIPS. Hence, health IT vendors 
are not included in the burden estimates for MIPS.
---------------------------------------------------------------------------

    For CY 2015, 98 qualified registries and 49 QCDRs were qualified to 
report quality measures data to CMS for purposes of the PQRS.\30\ Under 
MIPS we believe that the number of QCDRs and qualified registries will 
increase because (1) many MIPS eligible clinicians will be able to use 
the qualified registry and QCDR for all MIPS submission (not just for 
quality submission) and (2) QCDRs will be able to provide innovative 
measures that address practice needs. Qualified registries or QCDRs 
interested in submitting quality measures results and numerator and 
denominator data on quality measures to CMS on their participants' 
behalf will need to complete a self-nomination process in order to be 
considered qualified to submit on behalf of MIPS eligible clinicians or 
groups, unless the qualified registry or QCDR was qualified to submit 
on behalf of MIPS eligible clinicians or groups for prior program years 
and did so successfully. We estimate that the self-nomination process 
for qualifying additional qualified registries or QCDRs to submit on 
behalf of MIPS eligible clinicians or groups for MIPS will involve 
approximately 1 hour per qualified registry or QCDR to complete the 
online self-nomination process.
---------------------------------------------------------------------------

    \30\ The full list of qualified registries for 2015 is available 
at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/Downloads/2015QualifiedRegistries.pdf 
and the full list of QCDRs is available at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/Downloads/2015QCDRPosting.pdf.
---------------------------------------------------------------------------

    Please note that the self-nomination statement is an online form 
that entities will use to provide information on their business. The 
self-nomination statement will be available at https://jira.oncprojectracking.org/login.jsp.\31\
---------------------------------------------------------------------------

    \31\ The current online self nomination form for QCDRs and 
qualified registries was approved under the PQRS PRA (OMB Control 
Number (OCN) 0938-105). We anticipate the MIPS form will be very 
similar to the PQRS online form.
---------------------------------------------------------------------------

    In addition to completing a self-nomination statement, qualified 
registries and QCDRs will need to perform various other functions, such 
as meet with CMS officials when additional information is needed. In 
addition, QCDRs must benchmark and calculate their measure results. We 
note, however, that many of these capabilities may already be performed 
by QCDRs for purposes other than to submit data to CMS for MIPS. The 
time it takes to perform these functions may vary depending on the 
sophistication of the entity, but we estimate that a qualified registry 
or QCDR will spend an additional 9 hours performing various other 
functions related to being a MIPS qualified registry or QCDR.
    We estimate that the staff involved in the qualified registry or 
QCDR self-nomination process will mainly be Computer Systems Analysts 
or the equivalent, at an average labor cost of $83.96/hour. Therefore, 
assuming the total burden hours per qualified registry or QCDR 
associated with the self-nomination process is 10 hours, the annual 
burden hours is 1,500 (150 QCDRs x 10 hours). We estimate that the 
total cost to a qualified registry or QCDR associated with the self-
nomination process will be approximately $839.60 ($83.96 per hour x 10 
hours per qualified registry). We also estimate that 150 new qualified 
registries or QCDRs will go through the self-nomination

[[Page 28358]]

process leading to a total burden of $125,940 ($839.60 x 150).
    The burden associated with the qualified registry and QCDR 
submission requirements in MIPS will be the time and effort associated 
with the qualified registry calculating quality measures results from 
the data submitted to the qualified registry or QCDR by its 
participants and submitting the quality measures results, the numerator 
and denominator data on quality measures, and the advancing care 
information performance category and CPIA data to CMS on behalf of 
their participants. We expect that the time needed for a qualified 
registry or QCDR to review the quality measures and other information, 
calculate the measures results, and submit the measures results and 
numerator and denominator data on the quality measures and the 
advancing care information performance category and CPIA data on their 
participants' behalf will vary along with the number of MIPS eligible 
clinicians submitting data to the qualified registry or QCDR and the 
number of applicable measures. However, we believe that qualified 
registries and QCDRs already perform many of these activities for their 
participants. Therefore, there may not necessarily be an additional 
burden on a particular qualified registry or QCDR associated with 
calculating the measure results and submitting the measures results and 
numerator and denominator data on the quality measures to CMS on behalf 
of their MIPS participants. Whether there is any additional burden to 
the qualified registry or QCDR as a result of the qualified registry's 
or QCDR's participation in MIPS will depend on the number of measures 
that the qualified registry or QCDR intends to report to CMS and how 
similar the qualified registry's measures are to CMS' MIPS quality 
measures.
    Based on the assumptions previously discussed, we provide an 
estimate of total annual burden hours and total annual cost burden 
associated with a qualified registry or QCDR self-nominating to be 
considered ``qualified'' for the purpose of submitting quality measures 
results and numerator and denominator data on MIPS eligible clinicians.
[GRAPHIC] [TIFF OMITTED] TP09MY16.061

2. Burden for MIPS Data Validation
    Under MIPS, a CMS contractor will conduct a data validation survey 
in order to identify and address problems with data handling, data 
accuracy, and incorrect payments for the MIPS Program. Because the data 
that will be submitted by, or on behalf of, MIPS eligible clinicians to 
the MIPS Program will be used to calculate payment adjustments, it is 
critical that this data be accurate. Additionally, the data will be 
used to generate Feedback Reports for MIPS eligible clinicians and 
groups and, in some cases, is posted publicly on the CMS Web site, 
further supporting the need for accurate and complete data. The CMS 
data validation contractor will conduct surveys of Groups, Registries, 
Qualified Clinical Data Registries (QCDRs), EHR Vendors, and MIPS 
eligible clinicians in support of evaluating the data submitted for 
MIPS. The MIPS Data Validation survey will be similar to the PQRS Data 
Validation Survey. The PQRS Data Validation Survey uses a series of 
approximately thirty questions, arranged by category, to gather 
information about data handling practices, training, and quality 
assurance, as well as the challenges that stakeholders faced in 
participating in the PQRS program. Under MIPS, the survey's topics will 
be expanded beyond validation of quality measures to include CPIA and 
potentially advancing care information performance category data.
    The MIPS Data Validation Survey for Performance Year 2017 will be 
conducted in late 2018 for data reported in early 2018. Because the 
MIPS verification process is still under development, the precise 
sample size for respondents has not yet been determined. We anticipate 
that at most 500 entities would be contacted for MIPS data verification 
for Performance Year 2017. Based on the most recent year of the PQRS 
data validation survey, we will assume that the response rate will be 
86 percent. Hence, we estimated the total number of respondents for 
Performance Year 1 will be 430 (500 entities contacted x 86 percent 
response rate).
    We estimate the total annual burden for the ongoing MIPS data 
validation will be up to 750 hours each performance year (500 responses 
x 1.5 hours), and the data validation will be conducted at a clerk's 
labor rate of $34.20 per hour for a total burden cost of $25,650 
($34.20 x 1.5).

[[Page 28359]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.062

E. Burden for Reporting Quality Performance Category via CAHPS for MIPS 
Survey

    Under MIPS, groups may elect to report on the CAHPS for MIPS Survey 
by contracting for survey administration with a CMS approved vendor. At 
this point, we do not believe that the groups that elect to report on 
CAHPS for MIPS will experience additional burden because CAHPS will 
cover one of their six Quality performance category measures. 
Beneficiaries will experience burden under the CAHPS survey; and 
because the survey will be similar to the CAHPS for PQRS survey, we are 
assuming that the burden per beneficiary will be the same.\32\
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    \32\ We are not proposing any changes to the CMS survey vendor 
certification process as we transition from CAHPS for PQRS to CAHPS 
for MIPS. Hence, we do not anticipate any new reporting burden for 
CAHPS survey vendors.
---------------------------------------------------------------------------

    The usual practice in estimating the burden on public respondents 
to surveys such as CAHPS is to assume that respondent time is valued, 
on average, at civilian wage rates. As previously explained, the BLS 
data show the average hourly wage for civilians in all occupations to 
be $23.06. Although most Medicare beneficiaries are retired, we believe 
that their time value is unlikely to depart significantly from prior 
earnings expense, and have used the average hourly wage to compute the 
dollar cost estimate for these burden hours.
    Under the first performance year of MIPS, we assume the number of 
groups that elect to report on the CAHPS for MIPS survey will be the 
same as 2014, when the CAHPS for PQRS survey was used. Table 54 shows 
the estimated annualized burden for beneficiaries to participate in the 
CAHPS for MIPS survey. We assume that all 300 groups submitting via the 
CMS Web Interface will elect to use the CAHPS for MIPS Survey. Based on 
historical information on the numbers of CAHPS for PQRS respondents, we 
assume that an average of 287 beneficiaries will respond per group. The 
CAHPS Survey for MIPS will be administered to approximately 86,100 
beneficiaries per year (300 groups x an average of 287 beneficiaries 
per group responding). The survey contains 83 items and is estimated to 
require an average administration time of 18.4 minutes in English (at a 
pace of 4.5 items per minute) and 22 minutes in Spanish (assuming 20 
percent more words in the Spanish translation), for an average response 
time of 20.24 minutes or 0.337 hours. These burden and pace estimates 
are based on CMS's experience with surveys of similar length that were 
fielded with Medicare beneficiaries. As indicated below, the annual 
total burden hours are estimated to be 29,106 hours (86,100 respondents 
x .337 burden hours per respondent to report).
[GRAPHIC] [TIFF OMITTED] TP09MY16.063

F. ICRs Regarding Burden Estimate for Advancing Care Information 
Performance Category (Sec.  414.1375 and Section II.E.5.g. of This 
Preamble)

    Advancing care information performance category data will not be 
submitted separately by MIPS eligible clinicians in most cases as was 
required under the Medicare EHR Incentive Program. MIPS eligible 
clinicians and clinician groups will submit this data using the same 
submission mechanism, or a similar submission mechanism they have 
selected for the other MIPS performance categories. For the purpose of 
submission advancing care information performance category objectives 
and measures under the MIPS, we have proposed in section II.E.1.f. of 
this proposed rule to allow for MIPS eligible clinicians to submit 
advancing care information performance category data through qualified 
registry, EHR, QCDR, and CMS Web Interface submission methods. Also, we 
have streamlined the submission requirements for advancing care 
information as part of the MIPS program. Compared to the reporting 
requirements in the 2015 Medicare EHR Incentive Program Final Rule, two 
objectives and their associated measures (Clinical Decision Support and

[[Page 28360]]

Computerized Provider Order Entry) will no longer be required for 
submission purposes. We have also worked to align the advancing care 
information performance category with other MIPS performance 
categories, such as submitting eCQMs to the quality category, which 
will streamline submission requirements and reduce MIPS eligible 
clinician confusion. Hence, a MIPS eligible clinician's estimated 
burden for the advancing care information performance category is lower 
than the estimated 7 hours per MIPS eligible clinician in the Medicare 
EHR Incentive Program--Stage 3 PRA (OMB control number 0938-1278) 
currently under review at OMB. We are requesting that effective January 
1, 2017, the MIPS Collection of Information Requirements replace those 
for eligible clinicians in the Medicare EHR Incentive Program Stage 3 
PRA.\33\
---------------------------------------------------------------------------

    \33\ We do not anticipate any changes in the CERHT process for 
EHR vendors as we transition to MIPS. Hence, EHR vendors are not 
included in these burden estimates.
---------------------------------------------------------------------------

    As noted above in Section B, a variety of entities will report 
advancing care information performance category data on behalf of 
clinicians. Based on historical data and 2015 Medicare EHR Incentive 
Program attestation, we estimate that approximately 436,500 clinicians 
not participating in APMs would submit advancing care information 
performance category data to MIPS.
[GRAPHIC] [TIFF OMITTED] TP09MY16.064

Because Performance Year 2017 will be the first year for MIPS eligible 
clinicians to report the advancing care information performance 
category data as groups, there is considerable uncertainty about what 
number of MIPS eligible clinicians will report as part of a groups. For 
the purposes of our burden estimate, we conservatively estimate that 
all the clinicians that reported as individuals under the 2015 Medicare 
EHR Incentive Program will continue to report as individuals in MIPS 
Year 1, but may transition to group submission in future years. Because 
some participants in APM Entities will be required to report advancing 
care information performance category data to fulfill the requirements 
of submitting to MIPS, we have included them in our burden estimate for 
the advancing care information performance category. Further we 
anticipate that the 434 Shared Savings Program ACOs will submit data at 
the ACO participant billing TIN level, for a total of 25,925 submitting 
entities, and approximately 55,000 other APM participants will report 
as individual MIPS eligible clinicians. Hence, as shown in Table 56, we 
estimate that up to approximately 517,425 entities will be submitting 
data under the advancing care information performance category (436,100 
MIPS eligible clinicians + 25,925 billing TINS within the Shared 
Savings Program ACOs + 55,000 APM participants). The total burden hours 
for a MIPS eligible clinician or group to report on the objectives and 
measures specified for the advancing care information performance 
category will be 4 hours. The total estimated burden hours are 
1,552,275 (517,425 x 4). At a physician's hourly rate, the total burden 
cost is $283,228,097 (1,552,275,300 x $182.46).
[GRAPHIC] [TIFF OMITTED] TP09MY16.065


[[Page 28361]]



G. ICRs Regarding Burden for Clinical Practice Improvement Activities 
Submission (Sec.  414.1355, Sec.  414.1365, and Section II.E.5.d of 
This Preamble)

    Requirements for submitting clinical practice improvement 
activities are new, and we do not have historical data which is 
directly relevant. As noted in section III.B, a variety of entities 
will report advancing care information performance category data on 
behalf of eligible clinicians. For eligible clinicians who are not part 
of APMs, we assume that the number of eligible clinicians submitting as 
part of a group will be approximately the same as the number of 
eligible clinicians submitting PQRS data through the GPRO Web Interface 
in 2014. We estimate that that there could be as many as 595,100 MIPS 
eligible clinicians submitting CPIA category data as individuals, which 
is equal to the number of eligible clinicians using the claims, QCDR or 
qualified registry, or EHR submission mechanisms under the 2014 
PQRS.\34\ We estimate that approximately 112,500 MIPS eligible 
clinicians comprising 300 groups may report at the group level.
---------------------------------------------------------------------------

    \34\ Because of the lack of historical data on CPIA submission, 
our estimate of 595,100 eligible clinicians submitting CPIA data is 
based on 2014 PQRS historical data (595,100 eligible clinicians = 
299,169 eligible clinicians submitting quality data through claims + 
214,590 eligible clinicians submitting quality data through QCDR or 
qualified registry + 77,241 eligible clinicians submitting quality 
data through EHR).
[GRAPHIC] [TIFF OMITTED] TP09MY16.066

Because some APM Entities and participants will be required to report 
CPIA data to fulfill the requirements of submitting to MIPS, we have 
included them in our burden estimate for the CPIA submitting. As with 
the advancing care information performance category, participants in 
Shared Savings Program ACOs will report at the ACO participant billing 
TIN level, and other APM participants will report as individual MIPS 
eligible clinicians. We anticipate MIPS eligible clinicians, groups, 
APM billing TINs, will submit CPIA data using the same mechanism, or a 
similar mechanism as they select for submitting quality data. In 
addition to collecting necessary supporting documentation, each MIPS 
eligible clinician, group, ACO participant billing TIN, or APM 
participant will provide a yes/no attestation submitted during the data 
submission period for successfully completed CPIAs. We estimate that up 
to approximately 676,325 entities will be submitting data for CPIA. We 
estimate it will take no longer than 3 hours per entity to submit data 
for the CPIA category. The total estimated burden is 2,028,975 (676,325 
entities x 3 hours each). At a physician's hourly rate, the total 
estimated burden cost is $370,206,779 (2,028,975 x $182.46).
[GRAPHIC] [TIFF OMITTED] TP09MY16.067


[[Page 28362]]



H. ICRs Regarding Burden for Resource Use (Sec.  414.1350 and Section 
II.E.5.c of This Preamble)

    The resource use performance category relies on administrative 
claims data. For claims-based submitting, the Medicare Parts A and B 
claims submission process is used to collect data on resource measures 
from MIPS eligible clinicians. MIPS eligible clinicians are not asked 
to provide any documentation by CD or hardcopy. Therefore, we do not 
anticipate any new or additional submitting for MIPS eligible 
clinicians as a result of this performance category within MIPS.

I. ICR Regarding Partial QP Elections for Advanced APMs

    Section II.E.5.h. of this preamble discusses the MIPS-related 
submission requirements for participants in the Shared Savings Program 
and certain APMs. APM Entities participating in Advanced APMs will face 
an additional submission requirement under MIPS related to Partial 
Qualifying APM Participant (QP) elections. A representative from each 
APM Entity will log into the MIPS portal to indicate whether eligible 
clinicians would wish to participate in MIPS if the eligible clinicians 
participating in the APM Entity are later deemed to be Partial QPs. We 
estimate it will take each APM Entity representative 15 minutes to make 
this election, and an additional 15 minutes to register for the MIPS 
Portal. We estimate that 543 APM Entities will make this election on 
the MIPS Portal, for a total burden estimate of 272 hours (543 x .5). 
At a computer systems analyst's hourly labor cost, the total burden 
cost is estimated to be $22,795 (272 x $83.96).
[GRAPHIC] [TIFF OMITTED] TP09MY16.068

J. Summary of Annual Burden Estimates

    The total gross burden estimate includes the total burden of 
recordkeeping and data submission under MIPS. Table 60 provides an 
estimate of the total annual burden of MIPS of 12,493,654 hours and a 
total annual burden cost of $1,327,177,683. Some of the information 
collection burden under MIPS does not represent an additional burden to 
the public, but replaces information collection burden that existed 
under two of its predecessor programs, the PQRS and the Medicare EHR 
Incentive Program. The estimated total existing burden approved for 
information collections related to PQRS and the Medicare EHR Incentive 
Program (for EPs) was 9,969,514 hours for a total annual burden cost of 
$1,199,257,029. The net burden estimate reflects only the incremental 
burden associated with this rule, and excludes the burden of existing 
recordkeeping and data submission under the PQRS, the Medicare EHR 
Incentive Program, CAHPS for PQRS, and PQRS Data Validation.\35\ 
Mindful of the combined data submission burden of MIPS, we have sought 
to avoid duplication of data submission efforts and simplified data 
submission structures within the unified program.
---------------------------------------------------------------------------

    \35\ The previously approved data collections OMB control 
numbers were as follows: PQRS (OCN 0938-1059), CAHPS for PQRS (OCN 
0938-1222), and PQRS Data Validation (OCN 0938-1255) and the 
Objectives/Measures (EP) ICR in the EHR Incentive Program Stage III 
PRA under review at OMB (OCN 0938-1278).

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[[Page 28363]]

[GRAPHIC] [TIFF OMITTED] TP09MY16.069


[[Page 28364]]


[GRAPHIC] [TIFF OMITTED] TP09MY16.070

K. Submission of PRA-Related Comments

    To obtain copies of the supporting statement and any related forms 
for the proposed collections discussed above, please visit CMS's Web 
site at www.cms.hhs.gov/PaperworkReductionActof1995, or call the 
Reports Clearance Office at 410-786-1326.
    We invite public comments on these potential information collection 
requirements. If you wish to comment, please submit your comments 
electronically as specified in the ADDRESSES section of this proposed 
rule and identify the rule (CMS-5517-P), the ICR's CFR citation, CMS ID 
number, and OMB control number.
    ICR-related comments are due July 8, 2016.

IV. Response to Comments

    Because of the large number of public comments we normally receive 
on Federal Register documents, we are not able to acknowledge or 
respond to them individually. We will consider all comments we receive 
by the date and time specified in the DATES section of this preamble, 
and, when we proceed with a subsequent document, we will respond to the 
comments in the preamble to that document.

V. Regulatory Impact Analysis

A. Statement of Need

    This proposed rule is necessary to make payment and policy changes 
under the Medicare PFS and to make statutorily-required changes under 
the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The 
MACRA's enactment consolidated certain aspects of physician quality 
reporting and performance programs into the new Merit-Based Incentive 
Payment System, including using certified EHR technology (Section 
1848(o) of the Act), the PQRS (Section 1848(k) and (m) of the Act), and 
the value-based payment modifier (Section 1848(p) of the Act). These 
programs have been developed and most recently implemented by CMS as 
the Medicare EHR Incentive Program (80 FR 62761), the PQRS (80 FR 
71135), and the VM (80 FR 71273). The MACRA's enactment altered the 
Medicare EHR Incentive Program such that the existing Medicare payment 
adjustment for EPs under section 1848(a)(7)(A) of the Act will end in 
CY 2018. Similarly, MACRA ends the separate PQRS Program in CY 2018 and 
provides for the inclusion of various aspects of PQRS in MIPS, and 
sunsets the VM program, ending it in CY 2018 and establishing certain 
aspects of the VM as a component of MIPS in CY 2019. Finally, the MACRA 
introduces incentive payment to eligible clinicians who become 
Qualifying APM Participants (QPs) through participation in Advanced 
APMs.
    This consolidated program for physicians and other eligible 
clinicians represents a new approach to the delivery of health care in 
this care setting aimed at reducing burden on Medicare-enrolled 
eligible clinicians, improving population health, lowering growth in 
overall health care costs, and providing clear incentives for the 
provision of the best quality care for Medicare beneficiaries. MIPS 
provides payment adjustments for eligible clinicians for providing 
value-driven health care services to their patients, and APMs offer a 
variety of opportunities that substantially alter the methods of 
payment for health care and enable clinicians to make fundamental 
changes to their day-to-day operations to improve the quality and 
reduce the cost of health care.

B. Overall Impact

    We have examined the impact of this rule as required by Executive 
Order 12866 on Regulatory Planning and Review (September 30, 1993), 
Executive Order 13563 on Improving Regulation and Regulatory Review 
(February 2, 2013), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), section 1102(b) of the Act, section 202 of the 
Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. L. 14-04), 
Executive Order 13132 on Federalism (August 4, 1999) and the 
Congressional Review Act (5 U.S.C. 804(2)).
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
regulatory impact analysis (RIA) must be prepared for major rules with 
economically significant effects ($100 million or more in any 1 year). 
We estimate, as discussed below in this section, that the PFS 
provisions included in this proposed rule will redistribute more than 
$100 million in 1 year. Therefore, we estimate that this rulemaking is 
``economically significant'' as measured by the $100

[[Page 28365]]

million threshold, and hence also a major rule under the Congressional 
Review Act. Accordingly, we have prepared a RIA that, to the best of 
our ability, presents the costs and benefits of the rulemaking. The RFA 
requires agencies to analyze options for regulatory relief of small 
entities. For purposes of the RFA, small entities include small 
businesses, nonprofit organizations, and small governmental 
jurisdictions. Most hospitals, practitioners and most other providers 
and suppliers are small entities, either by nonprofit status or by 
having annual revenues that qualify for small business status under the 
Small Business Administration (SBA) standards. (For details, see the 
SBA's Web site at http://www.sba.gov/content/table-smallbusiness-size-standards (refer to the 620000 series)). Individuals and States are not 
included in the definition of a small entity.
    The RFA requires that we analyze regulatory options for small 
businesses and other entities. We prepare a regulatory flexibility 
analysis unless we certify that a rule would not have a ``significant 
economic impact on a substantial number of small entities.'' The 
analysis must include a justification concerning the reason action is 
being taken, the kinds and number of small entities the rule affects, 
and an explanation of any meaningful options that achieve the 
objectives with less significant adverse economic impact on the small 
entities.
    There are over 1 million physicians, other practitioners, and 
medical suppliers that receive Medicare payment under the PFS. 
Approximately 95 percent of practitioners, other providers and 
suppliers are considered to be small entities, based upon the SBA 
standards. As shown later in this analysis, however, potential losses 
to these practitioners under the MIPS program are a small percentage of 
their total Medicare Part B PFS revenue--4 percent in the first year--
though rising to as high as 9 percent in subsequent years. On average, 
practitioners' Medicare billings are only about 22 percent of total 
revenue,\36\ so even those practitioners adversely affected by MIPS 
would rarely face losses in excess of 3 percent of revenues, the HHS 
standard for determining whether an economic effect is ``significant.'' 
(In order to determine whether a rule meets the RFA threshold of 
``significant'' impact HHS has for many years used as a standard 
adverse effects that exceed 3 percent of either revenues or costs.) 
However, because there are so many affected eligible clinicians, even 
if only a small proportion is significantly adversely affected, the 
number could be ``substantial.'' Therefore, we are unable to conclude 
that an Initial Regulatory Flexibility Analysis (IRFA) is not required. 
Accordingly, the analysis and discussion provided in this section, as 
well as elsewhere in this proposed rule, together meet the requirements 
for an IRFA. We note that whether or not a particular eligible 
clinician is adversely affected would depend in large part on the 
performance of that eligible clinician and that CMS will offer 
significant technical assistance to eligible clinician in meeting the 
new standards.
---------------------------------------------------------------------------

    \36\ Based on National Health Expenditure Data, Physicians and 
Clinical Services Expenditures, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html.
---------------------------------------------------------------------------

    In addition, section 1102(b) of the Act requires us to prepare an 
RIA if a rule may have a significant impact on the operations of a 
substantial number of small rural hospitals. This analysis must conform 
to the provisions of section 603 of the RFA. For purposes of section 
1102(b) of the Act, we define a small rural hospital as a hospital that 
is located outside of a Metropolitan Statistical Area for Medicare 
payment regulations and has fewer than 100 beds. We are not preparing 
an analysis for section 1102(b) of the Act because we have determined, 
and the Secretary certifies, that this proposed rule would not have a 
significant impact on the operations of a substantial number of small 
rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also 
requires that agencies assess anticipated costs and benefits on State, 
local, or tribal governments or on the private sector before issuing 
any rule whose mandates require spending in any 1 year of $100 million 
in 1995 dollars, updated annually for inflation. In 2016, that 
threshold is approximately $146 million. This proposed rule would 
impose no mandates on state, local, or tribal governments or on the 
private sector because participation in Medicare is voluntary and 
because physicians and other professionals have multiple options as to 
how they will participate under MIPS and discretion over their 
performance. Moreover, HHS interprets UMRA as applying only to 
``unfunded'' mandates. We do not interpret Medicare payment rules as 
being ``unfunded mandates,'' but simply as conditions for the receipt 
of payments from the Federal government for providing services that 
meet Federal standards. This interpretation applies whether the 
facilities or providers are private, state, local, or tribal.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on state 
and local governments, preempts state law, or otherwise has Federalism 
implications. Since this regulation does not impose any costs on state 
or local governments, the requirements of Executive Order 13132 are not 
applicable.
    We have prepared the following analysis, which together with the 
information provided in the rest of this preamble, meets all assessment 
requirements. The analysis explains the rationale for and purposes of 
this proposed rule; details the costs and benefits of the rule; 
analyzes alternatives; and presents the measures we would use to 
minimize the burden on small entities. As indicated elsewhere in this 
proposed rule, we are proposing to implement a variety of changes to 
our regulations, payments, or payment policies to implement statutory 
provisions. We provide information for each of the policy changes in 
the relevant sections of this proposed rule. We are unaware of any 
relevant federal rules that duplicate, overlap, or conflict with this 
proposed rule. The relevant sections of this proposed rule contain a 
description of significant alternatives if applicable.

C. Changes in Medicare Payments

    Section 101 of the, (1) repeals the Sustainable Growth Rate formula 
for physician payments in Medicare, and (2) requires that we establish 
a Merit-based Incentive Payment System for eligible clinician under 
which the Secretary must use an eligible clinician's composite 
performance score (CPS) to determine and apply a MIPS adjustment factor 
to the professional for a year.
    Repealing the Sustainable Growth Rate formula eliminated 
significant and immediate problems with Medicare's physician fee 
schedule payments, including implausible payment reductions (such as 
the 21.2 percent decrease that was scheduled for April 1, 2015). The 
Office of the Actuary estimated that avoiding those payment reductions 
results in a budgetary cost of $150.5 billion for fiscal years 2015 
through 2025 compared to the prior-law baseline. However, that cost is 
partially offset by other MACRA provisions that are estimated to have a 
net reduction in Federal expenditures of $47.7 billion.\37\ The largest 
component of the MACRA costs is its replacement of scheduled

[[Page 28366]]

reductions in physician payments with payment rates first frozen at 
2015 levels and then increasing at a rate of 0.5 percent a year during 
calendar years 2016 through 2019. The estimates in this RIA take those 
legislated rates as the baseline for the estimates we make as to the 
costs, benefits, and transfer effects of the regulation, with some data 
collection provisions taking effect in 2017 and substantial payment 
reforms first taking effect in 2019.
    As required by the MACRA, overall payment rates for services for 
which payment is made under the PFS would remain at the 2019 level 
through 2025, but starting in 2019, the amounts paid to individual 
eligible clinicians would be subject to adjustment through one of two 
mechanisms, depending on whether the eligible clinician meets the 
threshold for participation in Advanced APMs to be considered a 
Qualifying APM Participant (QP) or Partial QP, or is instead evaluated 
under MIPS.
    For APMs, from 2019 through 2024, eligible clinicians receiving a 
substantial portion of their revenue through Advanced APMs and meeting 
other applicable requirements to become QPs would receive a lump-sum 
payment after each year equal to 5 percent of their Medicare covered 
professional services for services reimbursed according to the PFS in 
the preceding year. The APM Incentive Payment is separate from, and in 
addition to, the reimbursement for services furnished by an eligible 
clinician during that year. Eligible clinicians who become QPs would 
not receive a MIPS performance adjustment under the PFS. Eligible 
clinicians who do not become QPs, but meet a slightly lower threshold, 
would be deemed Partial QPs for that year, and may elect to report to 
and be scored under MIPS. In QP Performance Period 2017, we define 
Partial QPs to be Advanced APM participants that have at least 20 
percent but less than 25 percent, of their Medicare Part B payments for 
covered professional services through an Advanced APM Entity, or at 
least 10 percent, but less than 20 percent, of their Medicare patients 
served through an Advanced APM Entity. If the Partial QP elects to be 
scored under MIPS, they would be subject to all MIPS requirements and 
would receive a MIPS payment adjustment. This adjustment may be 
positive or negative. If an eligible clinician does not meet either of 
those standards, the eligible clinician would be subject to MIPS and 
would report to MIPS and receive the corresponding MIPS payment 
adjustment.
    Beginning in 2026, payment rates for eligible clinicians who 
achieve QP status for a year would be increased each year by 0.75 
percent, while payment rates for eligible clinicians who do not achieve 
QP status would be increased each year by 0.25 percent. MIPS eligible 
clinicians would receive positive, neutral, or negative adjustments to 
their PFS payments in a payment year based on performance during a 
prior performance period. Although the legislation establishes overall 
payment rate and procedure parameters until 2026 and beyond, this 
impact analysis covers only the initial payment year (2019) in detail. 
After 2019, while overall payment levels will be partially bounded, we 
have also acknowledged in the preamble that the Department will revise 
its quality and other payment measures and overall payment thresholds 
and other parameters as eligible clinicians' behavior changes.
    As discussed further in the preamble to this proposed rule, we are 
proposing requirements for MIPS that may result in the exclusion of 
certain eligible clinicians for various reasons. For example, MACRA 
requires us to exclude eligible clinicians from MIPS participation if 
they are QPs, or if they are a type of eligible clinician whose 
specialty is excluded from MIPS for the 2019 and 2020 MIPS payment 
years. Additionally, we are proposing above to exclude low volume 
eligible clinicians, or those with less than $10,000 in allowable 
claims and fewer than 100 Medicare patients.
    We estimated the number of physicians and other professionals that 
would be excluded from MIPS due to their being QPs using data from APM 
entities that existed in 2014. First, we identified APM entities that 
participated in APMs that have similar design characteristics to those 
proposed for Advanced APMs in section II.F.4.b. of this proposed rule. 
In 2014, those models included the Pioneer Accountable Care 
Organization (ACO) Model (which is scheduled to end in 2016), 
Comprehensive ESRD Care (CEC) (which began in 2015, but used historical 
data from 2014), and Comprehensive Primary Care Initiative (CPC). 
Further, we assigned Shared Savings Program ACOs that existed in 2014 
their 2016 track assignments because several ACOs have since 
transitioned to higher risk tracks. Next, we analyzed 2014 claims data 
to identify the APM Entities within each of those APMs to determine 
which of those APM Entities met the criteria for having at least 25 
percent of their beneficiaries or allowable charges through the APM 
Entity.
    Using those procedures, we arrived at a lower bound estimate that 
approximately 30,658 physicians and other professionals would become 
QPs, representing an estimated total incentive payment amount of 
approximately $146,000,000. However, we expect that the number of QPs 
may be significantly higher than the estimate based on 2014 data. CMS 
has continued to introduce new APMs since 2014, and intends to continue 
to introduce more APMs in future years. We base this expectation on 
prior experience with increased enrollment in current models and 
targets for new models that are expected to be adopted in the future. 
Additionally, CMS anticipates increased participation in currently 
existing APMs. Our upper bound estimate of QPs, based on the same 
estimating procedures, is 90,000 and the corresponding estimated total 
incentive payment is $429,000,000. In this regard, it is longstanding 
HHS policy not to attempt to predict the effects of future rulemakings, 
in order to maximize future Secretarial discretion over whether, and if 
so how, payment or other rules would be changed.
    To estimate the number of physicians and other professionals 
ineligible or excluded due to the proposed low-volume exclusion, 
ineligible specialties, and newly-enrolled eligible clinicians, we 
began with a sample of clinicians participating in Medicare B in 
2014.\38\ We then estimated the number of ineligible clinicians by 
applying the low-volume exclusion proposed for MIPS--that is, eligible 
clinicians with less than $10,000 in allowable charges and fewer than 
100 Medicare patients--and number of clinicians ineligible for MIPS in 
Year 1 based on their specialty. We then removed eligible clinicians 
that were newly enrolled in Medicare.
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    \38\ We calculated the number of eligible clinicians (at TIN-NPI 
level) that had positive allowable charges and a reported specialty 
NPPES data.
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    We have estimated the effects of these various exclusions in Table 
61.

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[GRAPHIC] [TIFF OMITTED] TP09MY16.071

    We have also estimated the number of clinicians \39\ that we 
believe will be excluded from MIPS in CY 2017 by specialty. Our 
estimates follow in Table 62. We note that the estimates in Table 62 
are based on clinicians in our 2014 data that were in ineligible 
specialties, newly enrolled, or met the proposed low-volume exclusion. 
However, due to data limitations, the estimates include only a portion 
of the 30,658-90,000 QPs that are listed in Table 61 above.\40\
---------------------------------------------------------------------------

    \39\ Allowed charges only include allowed charges for covered 
professional services under Part B. For the QPs, the allowable 
charges for the lower bound were estimated using 2014 data, whereas 
the allowable charges for the upper bound were based on CMS 
projections about potential increase in APM participation.
    \40\ The QP estimates in Table 62 are counts of eligible 
clinicians that participated in the two APMs that were in effect in 
2014 and meet the criteria for Advanced APMs, that is, Comprehensive 
Primary Care and Pioneer ACO Models. (In our 2014 data, Pioneer ACO 
serves as a proxy for its successor, the Next Generation ACO Model). 
However, due to data limitations, the QP estimate in Table 62 does 
not count participants in Advanced APMs that were implemented after 
2014, including the Shared Savings Program Track 2 and 3, CEC, 
Comprehensive Primary Care Plus Model, and additional models still 
in development. In addition, the QP estimate in Table 62 does not 
count eligible clinicians that joined Advanced APMs already in 
existence.
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    Based on the estimates of excluded providers in Table 61, we 
estimate that between approximately 687,000 and 746,000 clinicians will 
be assigned a CPS score in MIPS Year 1.\41\ They are clinicians in 
eligible specialties that (a) are not QPs participating in Advanced 
APMs (b) exceeded the low volume threshold (c) have been enrolled as 
Medicare physicians for more than one year, (d) had measures that met 
or exceeded the relevant case size thresholds.
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    \41\ We estimate that 29,613 eligible clinicians with $2.443 
billion in allowable charges will submit quality performance 
category data to MIPS but will not receive scores in quality or 
resource use because their measures will not meet minimum case size 
requirements. Because our model assigned composite performance 
scores using data from the quality and resource use performance 
categories, our model did not assign CPSs to eligible clinicians who 
did not meet minimum case sizes for measures in these two 
categories. Shared Savings Program participants were not scored on 
resource use, so they did not receive a composite performance score 
in the model if they did not meet the minimum case sizes for their 
quality performance category measures. However, these eligible 
clinicians may be scored on advancing care information and CPIA, and 
those two performance categories could not be modeled at this time 
given limited historical data.

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[[Page 28370]]


    According to National Health Expenditure data,\42\ in 2013, 
physicians and other professionals received a total of $586.7 billion 
from all sources. Medicare paid $130.3 billion of that amount. Based on 
the lower bound total in Table 61 of $13,909 billion in allowed charges 
for professionals excluded from MIPS, we estimate that less than 11 
percent of professionals' Medicare Part B spending for services covered 
under the Medicare PFS will be excluded from MIPS, and less than 3 
percent of all professionals' spending from all sources will be 
excluded.
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    \42\ Physicians and Clinical Services Expenditures, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html.
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    We used 2014 VM, PQRS, and other available data to model the 
scoring provisions described in this regulation. First, we 
arithmetically calculated a hypothetical CPS for each eligible 
clinician. Then, we implemented an exchange function based on the 
provisions of this proposed rule to translate the hypothetical CPS into 
a negative payment adjustment or positive payment adjustment. This 
entailed modifying parameters of the exchange function iteratively in 
order to achieve distributions in payment adjustments that meet 
requirements related to budget neutrality and aggregate exceptional 
performance payment amounts. However, because of the lack of historical 
data for the proposed advancing care information and CPIA measures, 
this version of the model does not estimate scores for the advancing 
care information and CPIA performance categories. Based on 2015 
Medicare EHR Incentive Program data, we estimate that approximately 
226,514 Medicare attesters would receive a 90 percent score in the 
advancing care information performance category and thereby receive an 
estimated 23 more points to their CPS, and that 209,000 eligible 
clinicians receiving a negative adjustment for 2016 would receive an 
advancing care information performance category score of 0. We also 
estimate that approximately 412,678 clinicians are non-eligible 
provider types, and therefore, would not be measured on the advancing 
care information performance category. Hence we estimate the CPS using 
only quality and resource use performance category scores, but 
recognize the scores would adjust by the advancing care information 
characteristic estimates described above. The model also set a 
hypothetical performance threshold, and estimated a MIPS payment 
adjustment associated with each CPS.\43\
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    \43\ The model assigned the following weights were assigned to 
the quality and resource use categories in estimating the composite 
performance score. If an eligible clinician had a valid score in 
both the quality performance and resource use categories, then the 
quality measure would be assigned a maximum of 50 points, and the 
resource use measure 10 points. If one category was missing, the 
other category was assigned its weight.
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    The costs for implementation and complying with the advancing care 
information performance category requirements could potentially lead to 
higher operational expenses for MIPS eligible clinicians. However, we 
believe that the combination of payment adjustments and long-term 
overall gains in efficiency will likely offset the initial 
expenditures. Additionally, because we are proposing above to reweight 
the advancing care information performance category scores for eligible 
clinicians that were exempt from the Medicare EHR Incentive Program or 
received hardship exemptions, these proposals would not impose 
additional requirements for EHR adoption during the first MIPS 
performance period. Health IT vendor may face additional costs in the 
first year of MIPS if they choose to develop additional capabilities in 
their systems in order to submit advancing care information and CPIA 
performance category data on behalf of eligible clinicians.
    Additionally, we believe a majority of MIPS eligible clinicians who 
are able to report the advancing care information performance category 
of MIPS have already adopted an EHR during Stage 1 and 2 of the prior 
Medicare EHR Incentive Program. As we have stated with respect to the 
Medicare EHR Incentive Program, we believe that future retrospective 
studies on the costs to implement an EHR and the return on investment 
(ROI) will demonstrate efficiency improvements that offset the actual 
costs incurred by eligible clinicians participating in MIPS and 
specifically in the advancing care information performance category, 
but we are unable to quantify those costs and benefits at this time.
    At present, evidence on EHR benefits in either improving quality of 
care or reducing health care costs is mixed. This is not surprising 
since the adoption of EHR as a fully functioning part of medical 
practice is still in its infancy. Even physician offices and hospitals 
that can meet Medicare EHR Incentive Program standards have not 
necessarily fully implemented all the functionality of their systems or 
fully exploited the diagnostic, prescribing, and coordination of care 
capabilities that these systems promise. Moreover, many of the most 
important benefits of EHR depend on interoperability among systems and 
this functionality is still lacking in many EHR systems. A recent RAND 
report prepared for the ONC reviewed 236 recent studies that related 
the use of health IT to quality, safety, and efficacy in ambulatory and 
non-ambulatory care settings and found that--

    A majority of studies that evaluated the effects of health IT on 
healthcare quality, safety, and efficiency reported findings that 
were at least partially positive. These studies evaluated several 
forms of health IT: metrics of satisfaction, care process, and cost 
and health outcomes across many different care settings. The 
relationship between health IT and [health care] efficiency is 
complex and remains poorly documented or understood, particularly in 
terms of healthcare costs, which are highly dependent upon the care 
delivery and financial context in which the technology is 
implemented. \44\
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    \44\ Paul G. Shekelle, et al. Health Information Technology: An 
Updated Systematic Review with a Focus on Meaningful Use 
Functionalities. RAND Corporation. 2014.

Other recent studies have not found definitive quantitative evidence of 
benefits.\45\ We request comments providing better evidence concerning 
EHR benefits in reducing the costs or increasing the value of EHR-
supported health care.
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    \45\ See, for example, Saurabh Rahurkar, et al, ``Despite the 
Spread of Health Information Exchange, There Is Little information 
Of Its Impact On Cost, Use, And Quality Of Care,'' Health Affairs, 
March 2015; and Hemant K. Bharga and Abhay Nath Mishra, ``Electronic 
Medical Records and Physician Productivity: Evidence from Panel Data 
Analysis,'' Management Science, July 2014.
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    Similarly, the costs for implementation and complying with the CPIA 
performance category requirements could potentially lead to higher 
expenses for MIPS eligible clinicians. Costs per full-time equivalent 
primary care clinician for CPIA will vary across practices, including 
for some activities or patient-centered medical home practices, in 
incremental costs per encounter, and in estimated costs per member per 
month. Costs may vary based on panel size and location of practice 
among other variables. For example, Magill (2015), conducted a study of 
PCMH in two states.\46\ Magill (2015), found that costs associated with 
a full-time equivalent primary care clinician, who were associated with 
PCMH functions, varied across practices. Specifically, Magill (2015) 
found an average of $7,691 per month in Utah practices, and an average 
of $9,658 in Colorado practices.

[[Page 28371]]

Consequently, PCMH incremental costs per encounter were $32.71 in Utah 
and $36.68 in Colorado (Magill, 2015). Magill (2015) also found that 
the average estimated cost per member, per month, for an assumed panel 
of 2,000 patients was $3.85 in Utah and $4.83 in Colorado. However, 
given the lack of comprehensive historical data for proposed CPIA, we 
are unable to quantify those costs in detail at this time. We request 
public comments on the costs associated with CPIA from practices that 
have implemented clinical practice improvements in the past.
---------------------------------------------------------------------------

    \46\ Magill et. al. ``The Cost of Sustaining a Patient-Centered 
Medical Home: Experience from 2 States.'' Annals of Family Medicine, 
2015; 13:429-435.
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    Payment impacts in this proposed rule reflect averages by specialty 
based on Medicare utilization. The payment impact for an individual 
eligible clinician could vary from the average and would depend on the 
mix of services that the eligible clinician furnishes. The average 
percentage change in total revenues would be less than the impact 
displayed here because eligible clinicians generally furnish services 
to both Medicare and non-Medicare patients. In addition, eligible 
clinicians may receive substantial Medicare revenues for services under 
other Medicare payment systems that would not be affected by MIPS 
adjustment factors.
    Table 63 shows the estimated payment impact on PFS services of the 
proposals contained in this proposed rule. To the extent that there are 
year-to-year changes in the volume and mix of services provided by 
eligible clinicians, the actual impact on total Medicare revenues will 
be different from those shown in Table 63. We conducted sensitivity 
analyses with low, high, and midpoint estimates, and we believe the 
midpoint estimate represents our best projection of the effects of the 
MIPS program on Medicare charges. As noted above, given the limitations 
on the data used for this simulation, differences between specialties 
are attributable to different performance levels on the quality and 
resource use performance category measures available from historical 
PQRS and VM data. Our midpoint estimate, with a performance threshold 
set at 50, follows as Table 63.\47\ Additionally, using the same data, 
we have estimated the impact on PFS services of the proposals contained 
in this proposed rule by practice size. That estimate follows as Table 
64.
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    \47\ Note to reviewers: This analysis has been updated with the 
latest estimates.

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    Based on National Health Expenditure data,\49\ total Medicare 
payments for physicians and clinical services expenditures in 2013 
reached $130.3 billion. Payments from all sources reached $586.7 
billion. Table 63 shows that the aggregate negative payment adjustment 
for all eligible clinicians under MIPS is estimated at $833 million, 
which represents less than 1 percent of eligible clinicians' Medicare 
payments and less than 0.2 percent of eligible clinicians' payments 
from all sources. Table 63 also shows that the aggregate positive 
payment adjustment for eligible clinicians under MIPS is estimated at 
$1.333 billion (including exceptional performance adjustments), which 
represents approximately 1.02 percent of eligible clinicians' Medicare 
payments and 0.23 percent of payments from all sources.
---------------------------------------------------------------------------

    \49\ Physicians and Clinical Services Expenditures, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html.
---------------------------------------------------------------------------

D. Impact on Beneficiaries

    There are a number of changes in this proposed rule that would have 
an effect on beneficiaries. In general, we believe that the proposed 
changes will have a positive impact and improve the quality and value 
of care provided to Medicare beneficiaries.
    More broadly, we expect that over time both the overall MIPS 
program and increasing participation in APMs will increasingly result 
in improved quality of care, resulting in lower morbidity and 
mortality, and in reduced spending, as physicians respond to the 
incentives offered by MIPS and APMs and adjust their clinical practices 
in order to maximize their performance on specified quality measures 
and activities. The various shared savings initiatives already 
operating have had modest success but have demonstrated that all three 
outcomes are possible. For example, in August of 2015, we issued 2014 
quality and financial performance results showing that Medicare ACOs 
continue to improve the quality of care for Medicare beneficiaries 
while generating financial savings.\50\ Additionally, in their first 
years of implementation, both Pioneer and Shared Savings Program ACOs 
had higher quality care than Medicare fee for service (FFS) providers 
on measures for which comparable data were available. Shared Savings 
Program patients with multiple chronic conditions and with high 
predicted Medicare spending received better quality care than 
comparable FFS patients.\51\ Between the first and third performance 
periods, Pioneer ACOs improved their average quality score from 73 
percent to 87 percent. Taken together, Pioneer and Shared Savings 
Program ACOs yielded $411 million in cost savings in 2014.\52\
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    \50\ https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-08-25.html.
    \51\ J. M. McWilliams et al., ``Changes in Patients' Experiences 
in Medicare Accountable Care Organizations.'' New England Journal of 
Medicine 2014; 371:1715-1724, DOI: 10.1056/NEJMsa1406552.
    \52\ The cost savings were for the second year of Shared Savings 
Program implementation and the third year of Pioneer ACO 
implementation. https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-08-25.html.
---------------------------------------------------------------------------

    Results from the first year of the CPC Initiative indicate that it 
has generated nearly enough savings in Medicare health care 
expenditures to offset care management fees paid by CMS.
     The primary sources of the savings were reduced rates of 
hospital admissions and emergency department visits.
     The bulk of the savings was generated by patients in the 
highest-risk quartile, but favorable results were also seen in other 
patients.
     Over 90 percent of practices successfully met all first-
year transformation requirements.
     The expenditure impact estimates differ across the seven 
regions.
     Additional time and data are needed to assess impact on 
care quality.
    These results should be interpreted cautiously as effects are 
emerging earlier than anticipated, and additional research is needed to 
assess how the initiative affects cost and quality of care beyond the 
first year. Because the effects of the CPC Initiative are likely to be 
larger in subsequent years, these early results suggest it is likely 
the model will eventually break-even or generate savings.\53\
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    \53\ https://blog.cms.gov/2015/01/23/moving-forward-on-primary-care-transformation/. For more detail see https://innovation.cms.gov/files/reports/cpci-evalrpt1.pdf.
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    Basing reimbursement in part on performance metrics is still an 
evolving art and, as discussed throughout this preamble, there are 
multiple variables and as yet no definitive answers as to what 
combinations of measures, benchmarks, and other variables will achieve 
the best results over time. Accordingly, we are unable at this time to 
provide specific dollar estimates of these benefits and cost 
reductions.

E. Impact on Other Health Care Programs and Providers

    The MIPS program is aimed at Medicare FFS physicians and other 
professionals paid under the PFS. These physicians and other 
professionals are almost all engaged in serving patients covered by 
other payers as well. Because Medicare covers only about one person in 
seven (though a considerably higher share of total healthcare spending, 
since older persons incur far higher expenses on average than younger 
persons), for most of those services that will be subject to MIPS 
payment adjustments, Medicare provides only a fraction of practice 
revenues. Moreover, it is unlikely that many insurance payers will 
adopt MIPS or MIPS-like payment models in the short run. Hence, MIPS 
incentives are necessarily attenuated. On the other hand, changing 
practices for one group of patients will possibly lead to changes for 
other patients (for example, EHR systems are almost always used for all 
patients served by a physician). Physicians and other professionals may 
find it simpler and more efficient to adopt clinical practice 
improvements for all patients, regardless of payer, in response to 
MACRA's incentives, through the use of both MIPS measures and 
activities and alternative payment models. Furthermore, since MACRA 
eventually rewards participation in APMs beyond those in Medicare, 
other payers may start to develop more models in which clinicians and 
patients can participate. Hence, there are likely to be beneficial 
effects on a far broader range of patients in the health care system 
than simply Medicare patients, and we believe those effects would 
include improved health care quality and lower costs over time. 
However, we have no basis at this time for quantifying such effects.
    We note that large proportions of the Medicare and Medicaid 
programs are already delivered through capitated insurance payments to 
HMOs, PPOs, and related organizations. The Medicare Advantage program 
and related State programs therefore already have substantial 
incentives to improve quality and reduce costs. MIPS does not affect 
provider payments under those programs directly, which have their own 
reimbursement mechanisms for physicians and other professionals. In 
many but not all cases, those insurance carriers do use incentive 
mechanisms that are similar in purpose and design to the kinds of APMs 
that we expect will arise under the new payment adjustments. We would 
not expect major near-term changes in HMO and PPO payment arrangements, 
or performance, from any MIPS or APM spillover effects. Regardless, we 
have no

[[Page 28377]]

basis at this time for quantifying any such effects.
    There are other potentially affected provider entities, including 
hospitals, skilled nursing facilities, Critical Access Hospitals 
(largely small rural hospitals), and providers serving unique 
populations, such as providers of tribal health care services. In none 
of these cases do we believe that MIPS would have significant effects 
on substantial numbers of providers. But to the extent that MIPS and 
increasing participation in APMs over time succeed in improving quality 
and reducing costs, there may be some beneficial effects not only on 
patients but also on some providers.
    As noted previously in this section of the preamble, and as 
discussed in this subsection, we have concluded that financial effects 
on either directly or indirectly affected small entities, including 
rural hospitals, will be minimal. We welcome comments on these 
conclusions.

F. Alternatives Considered

    This proposed rule contains a range of policies, including many 
provisions related to specific statutory provisions. The preceding 
preamble provides descriptions of the statutory provisions that are 
addressed, identifies those policies where discretion has been 
exercised, presents our rationale for our proposed policies and, where 
relevant, analyzes alternatives that we considered. While it is hard to 
single out any one alternative for public comment, we particularly call 
attention to the performance threshold and the level at which it is set 
for scoring purposes under MIPS.
    As described above, pursuant to section 1848(q)(6)(D)(i) of the 
Act, for each year of the MIPS, the Secretary shall compute a 
performance threshold with respect to which the CPSs of MIPS eligible 
clinicians are compared for purposes of determining the MIPS adjustment 
factors under section 1848(q)(6)(A) of the Act for a year. The 
performance threshold for a year must be either the mean or median (as 
selected by the Secretary, which may be reassessed every 3 years) of 
the CPSs for all MIPS eligible clinicians for a prior period specified 
by the Secretary. Section 1848(q)(6)(D)(iii) of the Act outlines a 
special rule for the initial 2 years of MIPS, which requires the 
Secretary, prior to the performance period for such years, to establish 
a performance threshold for purposes of determining the MIPS adjustment 
factors under paragraph (A) and an additional performance threshold for 
purposes of determining the additional MIPS adjustment factors under 
paragraph (C), each of which shall be based on a period prior to the 
performance periods and take into account data available with respect 
to performance on measures and activities that may be used under the 
performance categories and other factors determined appropriate by the 
Secretary.
    Depending on where the threshold is set within those parameters, 
the proportions and distributions of MIPS eligible clinicians receiving 
payment reductions versus positive payment adjustments can change 
dramatically from our estimates. For example, in Table 63, we estimated 
(based on available data) that 40.0 percent of Colon/Rectal Surgery 
specialists will receive a negative payment adjustment under MIPS. 
Setting the performance threshold at a lower level would enable more 
Colon/Rectal Surgery specialists to avoid negative adjustments and 
potentially qualify for more positive adjustments. Conversely, we 
estimated above that 59.2 percent of Interventional Radiology 
specialists would receive a positive adjustment under the current 
proposal. Setting the performance threshold at a higher level would 
result in fewer Interventional Radiology specialists qualifying for 
positive adjustments, and potentially more of them receiving negative 
adjustments. But any payment changes resulting from changes to the 
performance threshold policy will depend primarily on changes to 
practices and other responses from MIPS eligible clinicians.
    We request comment on these alternatives, on all previous estimates 
of effects, and on any other issues or options that might improve the 
substantive effects of this proposed rule, or our estimates of those 
effects. We are particularly interested in comments on any aspects of 
this proposed rule that might inadvertently or unintentionally create 
adverse effects on the delivery of high quality and high value health 
care, and on options that might reduce such effects.

G. Assumptions and Limitations

    We would like to note several limitations to the analyses that 
estimated eligible clinicians' eligibility, negative payment 
adjustments, and positive payment adjustments based for the first MIPS 
performance period (2017) based on 2014 data described above:
     The scoring model cannot reflect that eligible clinicians' 
behavioral responses to MIPS will be different than their responses to 
the 2014 PQRS requirements. As with all scoring models based on 
historical data, the model assumes that the measures reported and the 
distribution of scores on those measures would be the same under MIPS' 
first performance period as they were under the 2014 PQRS program. 
However, the intent of the MIPS program is to incentivize eligible 
clinicians both in terms of the reporting of measures and in terms of 
improving the quality of patient care.
     Limited historical data for two performance categories. 
Because we have limited historical data for the proposed advancing care 
information and CPIA performance categories, the modeled scoring 
estimates do not include advancing care information or CPIA performance 
category scores. The model also set a hypothetical performance 
threshold and estimated a MIPS payment adjustment for each CPS.
     Some of the MIPS scoring provisions could not be applied 
because MIPS will have different reporting requirements than PQRS. For 
example, the proposed MIPS scoring provisions require at least one 
cross-cutting quality measure, whereas the 2014 PQRS program did not 
have such a requirement.
     The scoring model does not reflect the growth in Advanced 
APM participation between 2014 and 2017. Due to data limitations, the 
scoring model could only identify clinicians that participated in 
Advanced APMs and would have exceeded the QP threshold in 2014. Several 
new Advanced APM have been implemented or will be implemented between 
2014 and 2017. Further, some clinicians will join the successors of 
Advanced APMs already in existence in 2014.
    Due the limitations above, there is considerable uncertainty around 
our estimates that is difficult to quantify in detail.

H. Accounting Statement

    As required by OMB Circular A-4 (available at http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf), in Table 65 (Accounting 
Statement), we have prepared an accounting statement.
    We have not attempted to quantify the benefits of this rule because 
of the many uncertainties as to both provider behaviors and resulting 
effects on patient health and cost reductions. For example, the 
applicable percentage for MIPS incentives changes over time, increasing 
from 4 percent in 2019 to 9 percent in 2022 and subsequent years, and 
we are unable to estimate precisely how physicians will respond to the 
increasing incentives. As noted above, in CY 2019, we estimate that we 
will distribute approximately $833 million in payment adjustments on a 
budget-

[[Page 28378]]

neutral basis, which represents the applicable percent for 2019 
required under section 1848(q)(6)(B)(i) of the Act and excludes $500 
million in exceptional performance payments. In 2020, section 
1848(q)(6)(B)(ii) of the Act specifies that the applicable percent will 
be 5 percent, which we estimate would mean that we will distribute 
approximately $1,041 million in payment adjustments on a budget-neutral 
basis, ignoring changes in clinical practice, volume growth, or other 
changes that may affect Medicare physician payments. Finally, in 2021, 
section 1848(q)(6)(B)(iii) of the Act specifies that the applicable 
percent will be 7 percent, which we estimate would mean that we will 
distribute approximately $1,458 million in payment adjustments on a 
budget-neutral basis, again ignoring changes in clinical practice, 
volume growth, or other changes that may affect Medicare physician 
payments, as well as the $500 million in exceptional performance 
payments.
    Further, the addition of new APMs and participants over time will 
affect the pool of MIPS eligible clinicians, and for those that are 
MIPS eligible clinicians, may change their relative performance. The 
$500 million available for exceptional performance and the 5 percent 
incentive for QPs are only available from 2019 through 2024. Beginning 
in 2026, QPs will receive a higher conversion factor than non-QPs. 
However, we are unable to estimate the number of QPs in those years, as 
we cannot project the number or types of Advanced APMs that will be 
made available in those years through future CMS initiatives proposed 
and implemented in those years, nor the number of QPs for those models.
    The percentage of the CPS attributable to each performance category 
will change over time, and we will incorporate improvement scoring in 
future years. The CPIA category represents an entirely new category for 
measuring eligible clinicians' performance. We may also propose policy 
changes in future years as we continue implementing MIPS and as 
eligible clinicians accumulate experience with the new system. 
Moreover, there are interactions between the MIPS and APM incentive 
programs and other shared savings and incentive programs that we cannot 
model or project. Nonetheless, even if ultimate savings and health 
benefits represent only low fractions of current experience, benefits 
are likely to be substantial in overall magnitude.
    The table that follows includes our estimate for MIPS payment 
adjustments ($833 million), the exceptional performance payments under 
MIPS ($500 million), and payments to QPs (using the lower bound 
estimate described in the preceding analysis, $146 million). However, 
of these three elements, only the budget-neutral MIPS payment 
adjustments are shown as estimated decreases.
[GRAPHIC] [TIFF OMITTED] TP09MY16.078

List of Subjects

42 CFR Part 414

    Administrative practice and procedure, Biologics, Drugs, Health 
facilities, Health professions, Kidney diseases, Medicare, Reporting 
and recordkeeping requirements.

42 CFR Part 495

    Administrative practice and procedure, Health facilities, Health 
maintenance organizations (HMO), Health professions, Health records, 
Medicaid, Medicare, Penalties, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services proposes to amend 42 CFR chapter IV as set forth 
below:

PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES

0
1. The authority citation for part 414 continues to read as follows:

    Authority: Secs. 1102, 1871, and 1881(b)(l) of the Social 
Security Act (42 U.S.C. 1302, 1395hh, and 1395rr(b)(l)).


Sec.  414.90  [Amended]

0
2. In Sec.  414.90--
0
a. Amend paragraph (e) introductory text by removing the phrase ``and 
subsequent years'' and adding in its place the phrase ``through 2018''.
0
b. Amend paragraph (e)(1)(ii) by removing the phrase ``and each 
subsequent year'' and adding in its place the phrase ``through 2018''.
0
3. Subpart O is added to part 414 to read as follows:

[[Page 28379]]

Subpart O--Merit-Based Incentive Payment System and Alternative Payment 
Model Incentive
Sec.
414.1300 Basis and scope.
414.1305 Definitions.
414.1310 Applicability.
414.1315 [Reserved]
414.1320 MIPS performance period.
414.1325 Data submission requirements.
414.1330 Quality performance category.
414.1335 Data submission criteria for the quality performance 
category.
414.1340 Data completeness criteria for the quality performance 
category.
414.1350 Resource use performance category.
414.1355 Clinical practice improvement activity performance 
category.
414.1360 Data submission criteria for the clinical practice 
improvement activity performance category.
414.1365 Subcategories for the clinical practice improvement 
activity performance category.
414.1370 APM scoring standard for MIPS.
414.1375 Advancing care information performance category.
414.1380 Scoring.
414.1385 Targeted review and review limitations.
414.1390 Data validation and auditing.
414.1395 Public reporting.
414.1400 Third party data submission.
414.1405 Payment.
414.1410 Advanced APM determination.
414.1415 Advanced APM criteria.
414.1420 Other payer advanced APMs.
414.1425 Qualifying APM participant determination: In general.
414.1430 Qualifying APM participant determination: QP and partial QP 
thresholds.
414.1435 Qualifying APM participant determination: Medicare option.
414.1440 Qualifying APM participant determination: All-payer 
combination option.
414.1445 Identification of other payer advanced APMs.
414.1450 APM incentive payment.
414.1455 Limitation on review.
414.1460 Monitoring and program integrity.
414.1465 Physician-focused payment models.

Subpart O--Merit-Based Incentive Payment System and Alternative 
Payment Model Incentive


Sec.  414.1300  Basis and scope.

    (a) Basis. This subpart implements the following provisions of the 
Act:
    (1) Section 1833(z)--Incentive Payments for Participation in 
Eligible Alternative Payment Models.
    (2) Section 1848(a)--Payment Based on Fee Schedule.
    (3) Section 1848(k)--Quality Reporting System.
    (4) Section 1848(q)--Merit-Based Incentive Payment System.
    (b) Scope. This subpart part sets forth the following:
    (1) The circumstances under which eligible clinicians are not 
considered MIPS eligible clinicians with respect to a year.
    (2) How individual MIPS eligible clinicians can have their 
performance assessed as a group.
    (3) The data submission methods and data submission criteria for 
each of the MIPS performance categories.
    (4) Methods for calculating a performance category score for each 
of the MIPS performance categories.
    (5) Methods for calculating a MIPS composite performance score and 
applying the MIPS payment adjustment to MIPS eligible clinicians.
    (6) The elements an APM must require of its participants to be 
designated an ``Advanced APM.''
    (7) Methods for how eligible clinicians and entities participating 
in Advanced APMs can meet the participation thresholds to become 
Qualifying APM Participants (QPs) and Partial QPs.
    (8) Methods and processes for counting participation in certain 
other payer arrangements (Other Payer Advanced APMs) in making QP and 
Partial QP determinations.
    (9) Methods for calculating and paying the APM Incentive Payment to 
QPs.
    (10) Evaluation of stakeholder submissions of Physician-Focused 
Payment Models (PFPMs).


Sec.  414.1305  Definitions.

    As used in this section, unless otherwise indicated--
    Additional performance threshold means an additional level of 
performance, in addition to the performance threshold, for a 
performance period at the composite level at or above which a MIPS 
eligible clinician may receive an additional positive MIPS adjustment 
factor.
    Advanced Alternative Payment Model (Advanced APM) means an APM that 
CMS determines meets the criteria set forth in Sec.  414.1415.
    Advanced APM Entity means an APM entity that participates in an 
Advanced APM or Other Payer Advanced APM through a direct agreement 
with CMS or a non-Medicare other payer, respectively.
    Affiliated practitioner means an eligible clinician identified by a 
unique APM participant identifier on a CMS-maintained list who has a 
contractual relationship with the Advanced APM Entity based at least in 
part on supporting the Advanced APM Entity's quality or cost goals 
under the Advanced APM.
    Alternative Payment Model (APM) means any of the following:
    (1) A model under section 1115A of the Act (other than a health 
care innovation award).
    (2) The shared savings program under section 1899 of the Act.
    (3) A demonstration under section 1866C of the Act.
    (4) A demonstration required by Federal law.
    APM Entity means an entity that participates in an APM or Other 
Payer APM through a direct agreement with CMS or a non-Medicare other 
payer, respectively.
    APM Entity group means the group of eligible clinicians 
participating in an APM Entity, as identified by a combination of the 
APM identifier, APM Entity identifier, Taxpayer Identification Number 
(TIN), and National Provider Identifier (NPI) for each participating 
eligible clinician.
    APM Incentive Payment means the lump sum incentive payment paid to 
Qualifying APM Participants.
    Attestation means a secure mechanism, specified by CMS, with 
respect to a particular performance period, whereby a MIPS eligible 
clinician or group may submit the required data for the advancing care 
information and/or CPIA performance categories of MIPS in a manner 
specified by CMS.
    Attributed beneficiary means a beneficiary attributed, according to 
the Advanced APM's attribution rules, to the Advanced APM Entity on the 
latest available list of attributed beneficiaries during the QP 
Performance Period.
    Attribution-eligible beneficiary means a beneficiary who during the 
QP performance period:
    (1) Is not enrolled in Medicare Advantage or a Medicare cost plan,
    (2) Does not have Medicare as a secondary payer,
    (3) Is enrolled in both Medicare Parts A and B,
    (4) Is at least 18 years of age,
    (5) Is a United States resident, and
    (6) Has a minimum of one claim for evaluation and management 
services furnished by an eligible clinician in the APM Entity group for 
any period during the QP Performance Period. For APMs that CMS 
determines to be focused on specific specialties or conditions or to 
have an attribution methodology that is not based on evaluation and 
management services, CMS uses a comparable standard related to the APM-
specific attribution methodology for identifying beneficiaries as 
potential candidates for attribution.
    Certified electronic health record technology (CEHRT) means the 
following:
    (1) For any calendar year before 2018, EHR technology (which could 
include

[[Page 28380]]

multiple technologies) certified under the ONC Health IT Certification 
Program that meets one of the following:
    (i) The 2014 Edition Base EHR definition (as defined at 45 CFR 
170.102) and that has been certified to the certification criteria that 
are necessary to report on applicable objectives and measures specified 
for the MIPS advancing care information performance category, including 
the applicable measure calculation certification criterion at 45 CFR 
170.314(g)(1) or (2) for all certification criteria that support a 
meaningful use objective with a percentage-based measure.
    (ii) Certification to--
    (A) The following certification criteria:
    (1) CPOE at--
    (i) 45 CFR 170.314(a)(1), (18), (19) or (20); or
    (ii) 45 CFR 170.315(a)(1), (2) or (3).
    (2)(i) Record demographics at 45 CFR 170.314(a)(3); or
    (ii) 45 CFR 170.315(a)(5).
    (3)(i) Problem list at 45 CFR 170.314(a)(5); or
    (ii) 45 CFR 170.315(a)(6).
    (4)(i) Medication list at 45 CFR 170.314(a)(6); or
    (ii) 45 CFR 170.315(a)(7).
    (5)(i) Medication allergy list 45 CFR 170.314(a)(7); or
    (ii) 45 CFR 170.315(a)(8).
    (6)(i) Clinical decision support at 45 CFR 170.314(a)(8); or
    (ii) 45 CFR 170.315(a)(9).
    (7) Health information exchange at transitions of care at one of 
the following:
    (i) 45 CFR 170.314(b)(1) and (2).
    (ii) 45 CFR 170.314(b)(1), (b)(2), and (h)(1).
    (iii) 45 CFR 170.314(b)(1), (b)(2), and (b)(8).
    (iv) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and (h)(1).
    (v) 45 CFR 170.314(b)(8) and (h)(1).
    (vi) 45 CFR 170.314(b)(1), (b)(2), and 170.315(h)(2).
    (vii) 45 CFR 170.314(b)(1), (b)(2), (h)(1), and 170.315(h)(2).
    (viii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and 170.315(h)(2).
    (ix) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), and 
170.315(h)(2).
    (x) 45 CFR 170.314(b)(8), (h)(1), and 170.315(h)(2).
    (xi) 45 CFR 170.314(b)(1), (b)(2), and 170.315(b)(1).
    (xii) 45 CFR 170.314(b)(1), (b)(2), (h)(1), and 170.315(b)(1).
    (xiii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and 170.315(b)(1).
    (xiv) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), and 
170.315(b)(1).
    (xv) 45 CFR 170.314(b)(8), (h)(1), and 170.315(b)(1).
    (xvi) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), 170.315(b)(1), 
and 170.315(h)(1).
    (xvii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), 170.315(b)(1), 
and 170.315(h)(2).
    (xviii) 45 CFR 170.314(h)(1) and 170.315(b)(1).
    (xix) 45 CFR 170.315(b)(1) and (h)(1).
    (xx) 45 CFR 170.315(b)(1) and (h)(2).
    (xxi) 45 CFR 170.315(b)(1), (h)(1), and (h)(2); and
    (B) Clinical quality measures at--
    (1) 45 CFR 170.314(c)(1) or 170.315(c)(1);
    (2) 45 CFR 170.314(c)(2) or 170.315(c)(2);
    (3) Clinical quality measure certification criteria that support 
the calculation and reporting of clinical quality measures at 45 CFR 
170.314(c)(2) and (3) and optionally (4); or 45 CFR 170.315(c)(3)(i) 
and (ii) and optionally (c)(4); and can be electronically accepted by 
CMS if the provider is submitting electronically.
    (C) Privacy and security at--
    (1) 45 CFR 170.314(d)(1) or 170.315(d)(1);
    (2) 45 CFR 170.314(d)(2) or 170.315(d)(2);
    (3) 45 CFR 170.314(d)(3) or 170.315(d)(3);
    (4) 45 CFR 170.314(d)(4) or 170.315(d)(4);
    (5) 45 CFR 170.314(d)(5) or 170.315(d)(5);
    (6) 45 CFR 170.314(d)(6) or 170.315(d)(6);
    (7) 45 CFR 170.314(d)(7) or 170.315(d)(7);
    (8) 45 CFR 170.314(d)(8) or 170.315(d)(8); and
    (D) The certification criteria that are necessary to report on 
applicable objectives and measures specified for the MIPS advancing 
care information performance category, including the applicable measure 
calculation certification criterion at 45 CFR 170.314(g)(1) or (2) or 
45 CFR 170.315(g)(1) or (2) for all certification criteria that support 
a meaningful use objective with a percentage-based measure.
    (iii) The definition for 2018 and subsequent years specified in 
paragraph (2) of this definition.
    (2) For 2018 and subsequent years, EHR technology (which could 
include multiple technologies) certified under the ONC Health IT 
Certification Program that meets the 2015 Edition Base EHR definition 
(as defined at 45 CFR 170.102) and has been certified to the 2015 
Edition health IT certification criteria--
    (i) At 45 CFR 170.315(a)(12) (family health history) and 45 CFR 
170.315(e)(3) (patient health information capture); and
    (ii) Necessary to report on applicable objectives and measures 
specified for the MIPS advancing care information performance category 
including the following:
    (A) The applicable measure calculation certification criterion at 
45 CFR 170.315(g)(1) or (2) for all certification criteria that support 
a meaningful use objective with a percentage-based measure.
    (B) Clinical quality measure certification criteria that support 
the calculation and reporting of clinical quality measures at 45 CFR 
170.315(c)(2) and (c)(3)(i) and (ii) and optionally (c)(4), and can be 
electronically accepted by CMS.
    Clinical Practice Improvement Activity (CPIA) means an activity 
that relevant eligible clinician organizations and other relevant 
stakeholders identify as improving clinical practice or care delivery 
and that the Secretary determines, when effectively executed, is likely 
to result in improved outcomes.
    CMS-approved survey vendor means a survey vendor that is approved 
by CMS for a particular performance period to administer the CAHPS for 
MIPS survey and to transmit survey measures data to CMS.
    CMS Web Interface means a web product developed by CMS that is used 
by groups that have elected to utilize the CMS Web Interface to submit 
data on the MIPS measures and activities.
    Composite performance score (CPS) means a composite assessment 
(using a scoring scale of 0 to 100) for each MIPS eligible clinician 
for a specific performance period determined using the methodology for 
assessing the total performance for a MIPS eligible clinician according 
to performance standards for applicable measures and activities for 
each performance category. The CPS is the sum of each of the products 
of each performance category score and each performance category's 
assigned weight.
    Covered professional services has the meaning given that term in 
section 1848(k)(3)(A) of the Act.
    Eligible clinician has the meaning of the term ``eligible 
professional'' as defined in section 1848(k)(3) of the Act, is 
identified by a unique TIN and NPI combination and, means any of the 
following:
    (1) A physician.
    (2) A practitioner described in section 1842(b)(18)(C) of the Act.
    (3) A physical or occupational therapist or a qualified speech-
language pathologist.

[[Page 28381]]

    (4) A qualified audiologist (as defined in section 1861(ll)(3)(B) 
of the Act).
    Episode payment model means an APM or other payer arrangement that 
incentivizes improving the efficiency and quality of care for an 
episode of care by bundling payment for services furnished to an 
individual over a defined period of time for a specific clinical 
condition or conditions.
    Estimated aggregate payment amounts means the total payments to a 
QP for Medicare Part B covered professional services for a year 
estimated by CMS as described in Sec.  414.1450(b).
    Group means a single TIN with two or more MIPS eligible clinicians, 
as identified by their individual NPI, who have reassigned their 
Medicare billing rights to the TIN.
    Health professional shortage areas (HPSA) means areas as designated 
under section 332(a)(1)(A) of the Public Health Service Act.
    High priority measure means an outcome, appropriate use, patient 
safety, efficiency, patient experience, or care coordination quality 
measure.
    Hospital-based MIPS eligible clinician means a MIPS eligible 
clinician who furnishes 90 percent or more of his or her covered 
professional services in sites of service identified by the codes used 
in the HIPAA standard transaction as an inpatient hospital or emergency 
room setting in the year preceding the performance period.
    Incentive payment base period means the calendar year prior to the 
year in which CMS disburses the APM Incentive Payment. CMS uses 
estimated aggregate payments to a QP for Medicare Part B covered 
professional services during this period as the basis for determining 
the Estimated Aggregate Expenditures described in Sec.  414.1450(b)(3).
    Low-volume threshold means an individual MIPS eligible clinician or 
group who, during the performance period, have Medicare billing charges 
less than or equal to $10,000 and provides care for 100 or fewer Part 
B-enrolled Medicare beneficiaries.
    Meaningful EHR user for MIPS means a MIPS eligible clinician who 
possesses CEHRT, uses the functionality of CEHRT, and reports on 
applicable objectives and measures specified for the advancing care 
information performance category for a performance period in the form 
and manner specified by CMS.
    Measure benchmark means the level of performance that the MIPS 
eligible clinician is assessed on for a specific performance period at 
the measures and activities level.
    Medicaid APM means a payment arrangement authorized by a state 
Medicaid program that meets the criteria for an Other Payer Advanced 
APM under Sec.  414.1420(a).
    Medical Home Model means an APM under section 1115A of the Act that 
is determined by CMS to have the following characteristics:
    (1) The APM's participants include primary care practices or 
multispecialty practices that include primary care physicians and 
practitioners and offer primary care services. For the purposes of this 
provision, primary care focus means involving specific design elements 
related to eligible clinicians practicing under one or more of the 
following Physician Specialty Codes: 01 General Practice; 08 Family 
Medicine; 11 Internal Medicine; 37 Pediatric Medicine; 38 Geriatric 
Medicine; 50 Nurse Practitioner; 89 Clinical Nurse Specialist; and 97 
Physician Assistant;
    (2) Empanelment of each patient to a primary clinician; and
    (3) At least four of the following:
    (i) Planned coordination of chronic and preventive care.
    (ii) Patient access and continuity of care.
    (iii) Risk-stratified care management.
    (iv) Coordination of care across the medical neighborhood.
    (v) Patient and caregiver engagement.
    (vi) Shared decision-making.
    (vii) Payment arrangements in addition to, or substituting for, 
fee-for-service payments (for example, shared savings or population-
based payments).
    Medicaid Medical Home Model means a payment arrangement under title 
XIX that CMS determines to have the following characteristics:
    (1) The Other Payer APM's participants include primary care 
practices or multispecialty practices that include primary care 
physicians and practitioners and offer primary care services. For the 
purposes of this provision, primary care focus means involving specific 
design elements related to eligible clinicians practicing under one or 
more of the following Physician Specialty Codes: 01 General Practice; 
08 Family Medicine; 11 Internal Medicine; 37 Pediatric Medicine; 38 
Geriatric Medicine; 50 Nurse Practitioner; 89 Clinical Nurse 
Specialist; and 97 Physician Assistant.;
    (2) Empanelment of each patient to a primary clinician; and
    (3) At least four of the following:
    (i) Planned chronic and preventive care.
    (ii) Patient access and continuity.
    (iii) Risk-stratified care management.
    (iv) Coordination of care across the medical neighborhood.
    (v) Patient and caregiver engagement.
    (vi) Shared decision-making.
    (vii) Payment arrangements in addition to, or substituting for, 
fee-for-service payments (for example, shared savings or population-
based payments).
    Merit-Based Incentive Payment System (MIPS) means the program 
required by section 1848(q) of the Act.
    MIPS APM means an APM for which the APM scoring standard under 
Sec.  414.1370 applies.
    MIPS eligible clinician as identified by a unique TIN and NPI 
combination, means any of the following:
    (1) A physician as defined in section 1861(r) of the Act.
    (2) A physician assistant, a nurse practitioner, and clinical nurse 
specialist as such terms are defined in section 1861(aa)(5) of the Act.
    (3) A certified registered nurse anesthetist as defined in section 
1861(bb)(2) of the Act.
    (4) A group that includes such clinicians.
    MIPS payment year means the calendar year in which MIPS payment 
adjustments are applied.
    New Medicare-Enrolled MIPS eligible clinician means an eligible 
clinician who first becomes a Medicare-enrolled eligible clinician 
within the Provider Enrollment, Chain and Ownership System (PECOS) 
during the performance period for a year and who had not previously 
submitted claims as a Medicare-enrolled eligible clinician either as an 
individual, an entity, or a part of a physician group or under a 
different billing number or tax identifier.
    Non-patient-facing MIPS eligible clinician means an individual MIPS 
eligible clinician or group that bills 25 or fewer patient-facing 
encounters during a performance period.
    Other Payer Advanced APM means a payment arrangement that meets the 
criteria set forth in Sec.  414.1420.
    Partial Qualifying APM Participant (Partial QP) means an eligible 
clinician determined by CMS to have met the relevant Partial QP 
Threshold under Sec.  414.1430(a)(2), (a)(4), (b)(2), and (b)(4) for a 
year.
    Partial QP patient count threshold means the minimum threshold 
score in Sec.  414.1430(a)(4) and (b)(4) an eligible clinician must 
attain through a patient count methodology described in Sec. Sec.  
414.1435(b) and 414.1440(c) to become a Partial QP for a year.
    Partial QP payment amount threshold means the minimum threshold 
score in Sec.  414.1430(a)(2) and (b)(2) an eligible clinician must 
attain through a payment amount methodology described Sec. Sec.  
414.1435(a) and 414.1440(b) to become a Partial QP for a year.

[[Page 28382]]

    Participation List means the list of participants in an APM Entity 
that is compiled from a CMS-maintained list.
    Performance category score means the assessment of each MIPS 
eligible clinician's performance on the applicable measures and 
activities for a performance category for a performance period based on 
the performance standards for those measures and activities.
    Performance standards means the level of performance and 
methodology that the MIPS eligible clinician is assessed on for a MIPS 
performance period at the measures and activities level for all MIPS 
performance categories.
    Performance threshold means the level of performance that is 
established for a performance period at the composite performance score 
level. CPSs above the performance threshold receive a positive MIPS 
adjustment factor and CPSs below the performance threshold receive a 
negative MIPS adjustment factor. CPSs that are equal to or greater than 
0, but not greater than one-fourth of the performance threshold receive 
the maximum negative MIPS adjustment factor for the MIPS payment year. 
CPSs at the performance threshold receive a neutral MIPS adjustment 
factor.
    Qualified Clinical Data Registry (QCDR) means a CMS-approved entity 
that has self-nominated and successfully completed a qualification 
process to determine whether the entity may collect medical and/or 
clinical data for the purpose of patient and disease tracking to foster 
improvement in the quality of care provided to patients.
    Qualified registry means a medical registry, a maintenance of 
certification program operated by a specialty body of the American 
Board of Medical Specialties or other data intermediary that, with 
respect to a particular performance period, has self-nominated and 
successfully completed a vetting process (as specified by CMS) to 
demonstrate its compliance with the MIPS qualification requirements 
specified by CMS for that performance period. The registry must have 
the requisite legal authority to submit MIPS data (as specified by CMS) 
on behalf of a MIPS eligible clinician or group to CMS.
    QP patient count threshold means the minimum threshold score in 
Sec.  414.1430(a)(3) and (b)(3) an eligible clinician must attain 
through a patient count methodology described in Sec. Sec.  414.1435(b) 
and 414.1440(c) to become a QP for a year.
    QP payment amount threshold means the minimum threshold score in 
Sec.  414.1430(a)(1) and (b)(1) an eligible clinician must attain 
through the payment amount methodology described in Sec. Sec.  
414.1435(a) and 414.1440(b) to become a QP for a year.
    QP Performance Period means the period of time that CMS will 
analyze to assess eligible clinician participation in Advanced APMs and 
Other Payer Advanced APMs for purposes of making the QP determinations 
in Sec.  414.1425. The QP Performance Period is the calendar year that 
is two years prior to the payment year.
    Qualifying APM Participant (QP) means an eligible clinician 
determined by CMS to have met or exceeded the relevant payment amount 
or patient count QP threshold under Sec.  414.1430(a)(1), (a)(3), 
(b)(1) or (b)(3) for a year based on participation in an Advanced APM 
Entity.
    Rural areas means clinicians in counties designated as micropolitan 
or non-Core Based Statistical Areas (CBSAs), using HRSA's 2014-2015 
Area Health Resource File (http://datawarehouse.hrsa.gov/data/datadownload/ahrfdownload.aspx).
    Small practices means practices consisting of 15 or fewer 
clinicians.
    Threshold Score means the percentage value that CMS determines for 
an eligible clinician based on the calculations described in Sec. Sec.  
414.1435 or 414.1440.
    Topped out measure means a measure where the Truncated Coefficient 
of Variation is less than 0.10 and the 75th and 90th percentiles are 
within 2 standard errors; or median value for a process measure that is 
95 percent or greater.


Sec.  414.1310  Applicability.

    (a) Except as specified in paragraph (b) of this section, MIPS 
applies to payments for items and services furnished by MIPS eligible 
clinicians on or after January 1, 2019.
    (b) Exclusions. (1) For a year, a MIPS eligible clinician does not 
include an eligible clinician who:
    (i) Is a Qualifying APM Participant as defined at Sec.  414.1305;
    (ii) Is a Partial Qualifying APM Participant (as defined at Sec.  
414.1305) for the most recent period for which data are available and 
who, for the performance period for the year, elects to not have 
measures and activities reported that are otherwise required to be 
reported by such professional under the MIPS; or
    (iii) For the performance period with respect to a year, does not 
exceed the low-volume threshold as defined at Sec.  414.1305.
    (2) [Reserved]
    (c) Treatment of new Medicare-enrolled eligible clinicians. New 
Medicare-enrolled eligible clinicians, as defined at Sec.  414.1305, 
must not be treated as a MIPS eligible clinician until the subsequent 
year and the performance period for such subsequent year.
    (d) In no case will a MIPS adjustment factor (or additional MIPS 
adjustment factor) apply to the items and services furnished by 
individuals who are not MIPS eligible clinicians, including the MIPS 
eligible clinicians described in paragraphs (b) and (c) of this 
section.
    (e) Requirements for groups. (1) The following way is for 
individual MIPS eligible clinicians to have their performance assessed 
as a group:
    (i) As part of a single TIN associated with two or more MIPS 
eligible clinicians, as identified by a NPI, that have their Medicare 
billing rights reassigned to the TIN.
    (ii) [Reserved]
    (2) A group must meet the definition of a group at all times during 
the performance period for the MIPS payment year in order to have its 
performance assessed as a group.
    (3) Individuals MIPS eligible clinicians within a group must 
aggregate their performance data across the TIN.
    (4) A group that elects to have its performance assessed as a group 
will be assessed as a group across all four MIPS performance 
categories.
    (5) A group must adhere to an election process established and 
required by CMS.


Sec.  414.1315  [Reserved]


Sec.  414.1320  MIPS performance period.

    For purposes of this subpart, the performance period for the year 
is the calendar year (January 1 through December 31) 2 years prior to 
the year in which the payment adjustment applies.


Sec.  414.1325  Data submission requirements.

    (a) Data submission performance categories. MIPS eligible 
clinicians and groups must submit measures, objectives, and activities 
for the quality, CPIA, and advancing care information performance 
categories.
    (b) Data submission mechanisms for individual eligible clinicians. 
An individual MIPS eligible clinician may elect to submit their MIPS 
data using:
    (1) A qualified registry for the quality, CPIA, or advancing care 
information performance categories;
    (2) The EHR submission mechanism (which includes submission of data 
by health IT vendors on behalf of MIPS eligible clinicians) for the 
quality, CPIA,

[[Page 28383]]

or advancing care information performance categories;
    (3) A QCDR for the quality, CPIA, or advancing care information 
performance categories;
    (4) Medicare Part B claims for the quality performance category; or
    (5) Attestation for the CPIA and advancing care information 
performance categories.
    (c) Data submission mechanisms for groups that are not reporting 
through an APM. Groups may submit their MIPS data using:
    (1) A qualified registry for the quality, CPIA, or advancing care 
information performance categories;
    (2) The EHR submission mechanism (which includes the submission of 
data by health IT vendors on behalf of groups) for the quality, CPIA, 
or advancing care information performance categories;
    (3) A QCDR for the quality, CPIA, or advancing care information 
performance categories;
    (4) A CMS Web Interface (for groups comprised of at least 25 MIPS 
eligible clinicians) for the quality, CPIA, and advancing care 
information performance categories;
    (5) Attestation for the CPIA and advancing care information 
performance categories; or
    (6) A CMS-approved survey vendor for groups that elect to include 
the CAHPS for MIPS survey as a quality measure. Groups that elect to 
include the CAHPS for MIPS survey as a quality measure must select one 
of the above data submission mechanisms to submit their other quality 
information.
    (d) Requirement to use only one submission mechanism per 
performance category. Except as described in paragraph (c)(6) of this 
section, MIPS eligible clinicians and groups may elect to submit 
information via multiple mechanisms; however, they must use the same 
identifier for all performance categories and they may only use one 
submission mechanism per performance category.
    (e) Requirement to use a CMS-approved survey vendor to submit CAHPS 
data. Groups that elect to include CAHPS for MIPS survey as a quality 
measure must use a CMS-approved survey vendor to submit CAHPS data but 
other quality data may be reported by any single one of the other 
available submission mechanisms for the quality performance category.
    (f) No data submission requirements for the resource use 
performance category and selected CPIA activities and quality measures. 
There are no data submission requirements for the resource use 
performance category and for certain quality measures used to assess 
performance on the quality performance category and for certain 
activities in the CPIA performance category. CMS will calculate 
performance on these measures using administrative claims data.
    (g) Data submission deadlines for all submission mechanisms for 
individual eligible clinician and groups for all performance 
categories. The submission deadlines are:
    (1) For the qualified registry, QCDR, EHR, and attestation 
submission mechanisms shall be March 31 following the close of the 
performance period.
    (2) For Medicare Part B claims, shall be on claims with dates of 
service during the performance period that must be processed no later 
than 90 days following the close of the performance period.
    (3) For the CMS Web Interface, shall be an eight-week period 
following the close of the performance period. The period shall begin 
no earlier than January 1 and end no later than March 31.


Sec.  414.1330  Quality performance category.

    (a) For purposes of assessing performance of MIPS eligible 
clinicians on the quality performance category, CMS will use:
    (1) Quality measures included in the MIPS final list of quality 
measures.
    (2) Quality measures used by QCDRs.
    (b) Subject to CMS's authority to reweight performance category 
weights under section 1848(q)(5)(F) of the Act, performance in the 
quality performance category will comprise:
    (1) 50 percent of a MIPS eligible clinician's composite performance 
score for 2019.
    (2) 45 percent of a MIPS eligible clinician's composite performance 
score for 2020.
    (3) 30 percent of a MIPS eligible clinician's composite performance 
score for each year thereafter.


Sec.  414.1335  Data submission criteria for the quality performance 
category.

    (a) Criteria. A MIPS eligible clinician or group must submit data 
on MIPS quality measures in one of the following manners, as 
applicable:
    (1) Via claims, qualified registry, EHR or QCDR submission 
mechanism. For the 12-month performance period--
    (i) Submit data on at least six measures including one cross-
cutting measure and at least one outcome measure. If an applicable 
outcome measure is not available, report one other high priority 
measure (appropriate use, patient safety, efficiency, patient 
experience, and care coordination measures). If fewer than six measures 
apply to the MIPS eligible clinician or group, report on each measure 
that is applicable.
    (ii) Subject to paragraph (a)(1)(i) of this section, MIPS eligible 
clinicians and groups can either select their measures from the 
complete MIPS final measure list or a subset of that list, MIPS 
specialty-specific measure sets, as designated by CMS.
    (2) Via the CMS Web Interface--for groups only. For the 12-month 
performance period--
    (i) For a group of 25 or more MIPS eligible clinicians, report on 
all measures included in the CMS Web Interface. The group must report 
on the first 248 consecutively ranked beneficiaries in the sample for 
each measure/module.
    (ii) If the sample of eligible assigned beneficiaries is less than 
248, then the group must report on 100 percent of assigned 
beneficiaries. In some instances, the sampling methodology will not be 
able to assign at least 248 patients on which a group may report, 
particularly those groups on the smaller end of the range of 25-99 MIPS 
eligible clinicians.
    (3) Via CMS-approved survey vendor for CAHPS for MIPS survey--for 
groups only. (i) For the 12-month performance period, a group who 
wishes to voluntarily elect to participate in the CAHPS for MIPS survey 
measures must use a survey vendor that is approved by CMS for a 
particular performance period to transmit survey measures data to CMS.
    (A) The CAHPS for MIPS survey counts for one measure towards the 
MIPS quality performance category and also fulfills the requirement to 
report at least one cross-cutting measure (and in the absence of an 
applicable outcome measure, the requirement to report at least one high 
priority measure as a patient experience measure).
    (B) Groups that elect this reporting mechanism must select an 
additional group data submission mechanism in order to meet the data 
submission criteria for the MIPS quality performance category.
    (ii) [Reserved]
    (b) Exception. MIPS eligible clinicians who are non-patient-facing 
eligible clinicians, as defined at Sec.  414.1305, are not required to 
submit data on a cross-cutting measure.


Sec.  414.1340  Data completeness criteria for the quality performance 
category.

    (a) MIPS eligible clinicians and groups submitting quality measures 
data using the QCDR, qualified registry, or

[[Page 28384]]

EHR submission mechanism must submit data on at least 90 percent of the 
MIPS eligible clinician or group's patients that meet the measure's 
denominator criteria, regardless of payer.
    (b) MIPS eligible clinicians submitting quality measures data using 
Medicare Part B claims, must submit data on at least 80 percent of the 
applicable Medicare Part B patients.
    (c) Groups submitting quality measures data using the CMS Web 
Interface or a CMS-approved survey vendor to submit the CAHPS for MIPS 
survey must meet the data submission requirement on the sample of the 
Medicare Part B patients CMS provides.


Sec.  414.1350  Resource use performance category.

    (a) For purposes of assessing performance of MIPS eligible 
clinicians on the resource use performance category, CMS specifies 
resource use measures for a performance period.
    (b) Subject to CMS's authority to reweight performance category 
weights under section 1848(q)(5)(F) of the Act, performance in the 
resource use performance category comprises:
    (1) 10 percent of a MIPS eligible clinician's composite performance 
score for MIPS payment year 2019.
    (2) 15 percent of a MIPS eligible clinician's composite performance 
score for MIPS payment year 2020.
    (3) 30 percent of a MIPS eligible clinician's composite performance 
score for each year thereafter.


Sec.  414.1355  Clinical practice improvement activity performance 
category.

    (a) For purposes of assessing performance of MIPS eligible 
clinicians on the CPIA performance category, CMS specifies an inventory 
of measures and activities for a performance period.
    (b) Subject to CMS's authority to reweight performance category 
weights under section 1848(q)(5)(F) of the Act, performance in the CPIA 
performance category comprises:
    (1) 15 percent of an MIPS eligible clinician's composite 
performance score for MIPS payment year 2019 and for each year 
thereafter.
    (2) [Reserved]
    (c) The CPIA inventory shall include one or more of the following 
criteria (in any order):
    (1) Relevant to an existing CPIA subcategory (or a proposed new 
subcategory).
    (2) Importance of activity toward achieving improved beneficiary 
health outcome.
    (3) Importance of activity that could lead to improvement in 
practice to reduce healthcare disparities.
    (4) Aligned with patient-centered medical home.
    (5) Representative of activities that multiple providers could 
perform (for example, primary care, specialty care).
    (6) Feasible to implement, recognizing importance in minimizing 
provider burden, especially for small (consisting of 15 or fewer 
clinicians), practices located in rural areas, and geographic HPSAs 
designated by HRSA.
    (7) CMS is able to be validate the activity; or
    (8) Evidence supports that an activity has a high probability of 
contributing to improved beneficiary health outcomes.
    (d) For purposes of assessing performance of MIPS eligible 
clinicians on the CPIAs performance category, CMS uses activities 
included in the CPIA Inventory described in paragraph (c) of this 
section.


Sec.  414.1360  Data submission criteria for the clinical practice 
improvement activity performance category.

    (a) MIPS eligible clinicians must submit data on MIPS CPIAs in one 
of the following manners:
    (1) Via administrative claims (if technically feasible), qualified 
registry, EHR submission mechanisms, QCDR, CMS Web Interface or 
Attestation. For activities that are performed for at least 90-days 
during the performance period, MIPS eligible clinicians must--
    (i) Submit a yes/no response for activities within the CPIA 
Inventory.
    (ii) [Reserved]
    (2) [Reserved]
    (b) [Reserved]


Sec.  414.1365  Subcategories for the clinical practice improvement 
activity performance category.

    (a) MIPS eligible clinicians select subcategories from the 
following:
    (1) Expanded practice access, such as same day appointments for 
urgent needs and after-hours access to clinician advice.
    (2) Population management, such as monitoring health conditions of 
individuals to provide timely health care interventions or 
participation in a QCDR.
    (3) Care coordination, such as timely communication of test 
results, timely exchange of clinical information to patients or other 
providers, and use of remote monitoring or telehealth.
    (4) Beneficiary engagement, such as the establishment of care plans 
for individuals with complex care needs, beneficiary self-management 
assessment and training, and using shared decision-making mechanisms.
    (5) Patient safety and practice assessment, such as through the use 
of clinical or surgical checklists and practice assessments related to 
maintaining certification.
    (6) Participation in an APM, as defined in section 1833(z)(3)(C) of 
the Act.
    (7) Achieving health equity, as its own category or as a multiplier 
where the achievement of high quality in traditional areas is rewarded 
at a more favorable rate for MIPS eligible clinicians that achieve high 
quality for underserved populations, including persons with behavioral 
health conditions, racial and ethnic minorities, sexual and gender 
minorities, people with disabilities, people living in rural areas, and 
people in geographic HPSAs.
    (8) Emergency preparedness and response, such as measuring MIPS 
eligible clinician participation in the Medical Reserve Corps, 
measuring registration in the Emergency System for Advance Registration 
of Volunteer Health Professionals, measuring relevant reserve and 
active duty military MIPS eligible clinician activities, and measuring 
MIPS eligible clinician volunteer participation in domestic or 
international humanitarian medical relief work.
    (9) Integrated behavioral and mental health, such as measuring or 
evaluating such practices as: Co-location of behavioral health and 
primary care services; shared/integrated behavioral health and primary 
care records; cross-training of MIPS eligible clinicians, and 
integrating behavioral health with primary care to address substance 
use disorders or other behavioral health conditions, as well as 
integrating mental health with primary care.
    (b) [Reserved]


Sec.  414.1370  APM scoring standard for MIPS.

    (a) General. The APM scoring standard establishes a scoring 
methodology for APM Entity groups participating in MIPS APMs, defined 
at Sec.  414.1305.
    (b) Criteria for the APM scoring standard under MIPS. The APM 
scoring standard under MIPS applies to APM Entity groups participating 
in MIPS APMs, which are APMs that meet the following criteria:
    (1) APM Entities participate in the APM under an agreement with 
CMS;
    (2) The participating APM Entities include one or more MIPS 
eligible clinicians on a Participation List;
    (3) The APM bases payment on cost/utilization and quality measures; 
and
    (4) The APM does not have the following characteristics:
    (i) New APMs. The APM scoring standard does not apply to an APM

[[Page 28385]]

during a MIPS performance period if the APM's first performance year 
begins after the first day of that MIPS performance period.
    (ii) APMs for which using the APM scoring standard is 
impracticable. If CMS determines within 60 days after the beginning of 
the MIPS performance period that it is impracticable for APM Entity 
groups to report to MIPS using the APM scoring standard in an APM's 
last year of operation, the APM scoring standard would not apply.
    (c) APM scoring standard performance period. The MIPS performance 
period under Sec.  414.1320 applies to the APM scoring standard.
    (d) APM participant identifier. The APM participant identifier for 
an eligible clinician is the combination of four identifiers:
    (1) APM identifier (established for the APM by CMS; for example, 
XXXXXX);
    (2) APM Entity identifier (established for the APM by CMS; for 
example, AA00001111);
    (3) Medicare-enrolled billing TIN (for example, XXXXXXXXX); and
    (4) Eligible clinician NPI (for example, 1111111111).
    (e) APM Entity group. (1) The APM Entity group consists of all 
eligible clinicians identified on the Participation List of the APM 
Entity on December 31 of the performance period.
    (2) The APM scoring standard only applies to the eligible 
clinicians identified on the Participation List for an APM Entity 
group.
    (3) CMS communicates to each APM Entity the list of eligible 
clinicians included in the APM Entity group as soon as practicable 
following the end of each calendar year.
    (4) The MIPS composite performance score calculated for the APM 
Entity group is applied to each eligible clinician in the APM Entity 
group.
    (5) The MIPS payment adjustment is applied at the TIN/NPI level for 
each of the eligible clinicians in the APM Entity group.
    (f) APM Entity group scoring under the APM scoring standard--(1) 
Quality. (i) APMs that submit quality data using the CMS Web Interface. 
The MIPS performance category score for quality will be calculated for 
the APM Entity group using the data submitted for the APM Entity 
through the CMS Web Interface according to the terms of the APM.
    (ii) APMs that do not submit quality data using the CMS Web 
Interface. For the MIPS 2019 payment year only, the quality performance 
category does not apply to MIPS eligible clinicians participating in 
MIPS APMs. This does not affect the requirements of an eligible 
clinician or APM Entity with regards to reporting and scoring under the 
APM. Starting in the MIPS 2020 payment year, the quality performance 
category will apply to MIPS eligible clinicians participating in MIPS 
APMs.
    (2) Resource use. APM Entity groups are not assessed under the MIPS 
resource use performance category.
    (3) Clinical practice improvement activities. (i) For APM Entity 
groups in the Shared Savings Program, each APM participant TIN submits 
data on the CPIA performance category according to the CPIA data 
submission criteria at Sec.  414.1360 and have their performance on the 
CPIA performance category assessed as a group in accordance with Sec.  
414.1310(e). The APM Entity group CPIA performance category score is 
the weighted mean of the TIN group scores, weighted based on the number 
of MIPS eligible clinicians in the APM Entity that have reassigned 
their billing right to each respective TIN in the APM Entity.
    (ii) For APM Entity groups in MIPS APMs other than the Shared 
Savings Program, each MIPS eligible clinician in the APM Entity submits 
data on the CPIA performance category according to the CPIA data 
submission criteria at Sec.  414.1360. The MIPS eligible clinicians 
within the APM Entity will have their performance on the CPIA 
performance category assessed as individual MIPS eligible clinicians. 
The APM Entity group CPIA performance category score is the mean of the 
individual scores for each MIPS eligible clinician in the APM Entity 
group.
    (4) Advancing care information. (i) For APM Entity groups in the 
Shared Savings Program, each APM participant TIN submits data on the 
advancing care information performance category according to the 
criteria at Sec.  414.1375(b) and have their performance on the 
advancing care information performance category assessed as a group in 
accordance with Sec.  414.1310(e). The APM Entity group advancing care 
information performance category score is the weighted mean of the TIN 
group scores, weighted based on the number of MIPS eligible clinicians 
in the APM Entity that have reassigned their billing right to each 
respective TIN in the APM Entity.
    (ii) For APM Entity groups in MIPS APMs other than the Shared 
Savings Program, each MIPS eligible clinician in the APM Entity submits 
data on the advancing care information performance category according 
to the criteria at Sec.  414.1375(b). The MIPS eligible clinicians 
within the APM Entity will have their performance on the advancing care 
information performance category assessed as individual MIPS eligible 
clinicians. The APM Entity group advancing care information performance 
category score is the mean of the individual scores for each eligible 
clinician in the APM Entity group.
    (g) APM Entity group performance category weights. For the 2019 
payment adjustment, the performance category weights for APM Entity 
groups are:
    (1) Quality. (i) The Shared Savings Program and other MIPS APMs 
that submit quality data through the CMS Web Interface: 50 percent.
    (ii) MIPS APMs that do not submit quality data through the CMS Web 
Interface: 0 percent.
    (2) Resource use: 0 percent.
    (3) Clinical practice improvement activities. (i) Shared Savings 
Program and other MIPS APMs that submit quality data through the CMS 
Web Interface: 20 percent.
    (ii) MIPS APMs that do not submit quality data through the CMS Web 
Interface: 25 percent.
    (4) Advancing care information. (i) Shared Savings Program and 
other APMs that submit quality data through the CMS Web Interface: 30 
percent.
    (ii) MIPS APMs that do not submit quality data through the CMS Web 
Interface: 75 percent.


Sec.  414.1375  Advancing care information performance category.

    (a) Composite performance score. Subject to CMS's authority to 
reweight performance category weights under section 1848(q)(5)(E)(ii) 
and (q)(5)(F) of the Act, performance in the advancing care information 
performance category will comprise 25 percent of a MIPS eligible 
clinician's composite performance score for payment year 2019 and each 
year thereafter.
    (b) Reporting for the advancing care information performance 
category: To earn a performance category score for the advancing care 
information performance category for inclusion in the composite 
performance score a MIPS eligible clinician must:
    (1) Use CEHRT as defined at Sec.  414.1305 for the MIPS performance 
period;
    (2) Report MIPS--advancing care information objectives and 
measures: Report on the objectives and associated measures as defined 
for the performance period as follows:
    (i) Report the numerator and denominator for all measures; or
    (ii) Report the number and denominator for all applicable and 
available measures and a null value for any measure that:
    (A) Is not applicable and available for the MIPS eligible 
clinician; and

[[Page 28386]]

    (B) Includes a null value as an acceptable result in the measure 
specification.
    (3) Support information exchange and the prevention of health 
information blocking, and cooperate with authorized surveillance of 
CEHRT. (i) The MIPS eligible clinician must attest to CMS that he or 
she cooperated in good faith with the surveillance and ONC direct 
review of his or her CEHRT under the ONC Health IT Certification 
Program, as authorized by 45 CFR part 170, subpart E, including by 
permitting timely access to such technology and demonstrating its 
capabilities as implemented and used by MIPS eligible clinician in the 
field.
    (ii) Support for health information exchange and the prevention of 
information blocking. The MIPS eligible clinician must attest to CMS 
that he or she--
    (A) Did not knowingly and willfully take action (such as to disable 
functionality) to limit or restrict the compatibility or 
interoperability of CEHRT.
    (B) Implemented technologies, standards, policies, practices, and 
agreements reasonably calculated to ensure, to the greatest extent 
practicable and permitted by law, that the CEHRT was, at all relevant 
times--
    (1) Connected in accordance with applicable law;
    (2) Compliant with all standards applicable to the exchange of 
information, including the standards, implementation specifications, 
and certification criteria adopted at 45 CFR part 170;
    (3) Implemented in a manner that allowed for timely access by 
patients to their electronic health information; and
    (4) Implemented in a manner that allowed for the timely, secure, 
and trusted bi-directional exchange of structured electronic health 
information with other health care providers (as defined by 42 U.S.C. 
300jj(3)), including unaffiliated providers, and with disparate CEHRT 
and health IT vendors.
    (c) Good faith and timely responses. Responded in good faith and in 
a timely manner to requests to retrieve or exchange electronic health 
information, including from patients, health care providers (as defined 
by 42 U.S.C. 300jj(3)), and other persons, regardless of the 
requestor's affiliation or health IT vendor.


Sec.  414.1380  Scoring.

    (a) General. MIPS eligible clinicians are scored under MIPS based 
on their performance on measures and activities in four performance 
categories. MIPS eligible clinicians are scored against performance 
standards for each performance category and receive a Composite 
Performance Score (CPS), composed of their scores on individual 
measures and activities, and calculated according to the finalized CPS 
methodology.
    (1) Measures and activities in the four performance categories are 
scored against performance standards.
    (i) For the quality and resource use performance categories, 
measures are scored between zero and 10 points against performance 
standards that we refer to as measure benchmarks. Bonus points are 
available for the quality performance category for both reporting 
specific types of measures and using CEHRT systems to capture and 
report quality measures.
    (ii) For the CPIA performance category, each CPIA is worth a 
certain number of points. The points for each reported activity is 
summed and compared against the highest potential score.
    (iii) For the advancing care information performance category, 
performance is the sum of a base score and performance score.
    (A) Base score: Achieved by meeting the Protect Patient Health 
Information measure and reporting the numerator (of at least one) and 
denominator or yes/no statement as appropriate (only a yes statement 
would qualify for credit under the base score) for each required 
measure.
    (B) Performance score: Decile scale for additional achievement on 
selected measures above their base score requirement.
    (2) MIPS eligible clinicians meeting applicable data completeness 
criteria receive credit for applicable measures and activities.
    (3) All performance levels receive points provided that data meet 
the required case minimum, data completeness and sufficient benchmark 
for the quality and resource use performance categories.
    (4) The baseline period is 2 years prior to the performance period 
for the MIPS payment year.
    (b) Performance categories. MIPS eligible clinicians are scored 
under MIPS in four performance categories.
    (1) Quality performance category. MIPS eligible clinicians receive 
one to ten achievement points for each scored quality measure in the 
quality performance category based on the MIPS eligible clinician's 
performance compared to applicable measure benchmarks. Each scored MIPS 
quality measure must have a measure benchmark. Exception. The maximum 
number of points for a topped out measure is the midpoint of the 
highest and lowest scores within a cluster.
    (i) Measure benchmarks are based on historical performance for the 
measure based on a baseline period and each benchmark must have a 
minimum of 20 MIPS eligible clinicians who reported the measure meeting 
the data completeness requirement and minimum case size criteria.
    (ii) Exception. If there is no comparable data from the baseline 
period, CMS would use information from the performance period to assess 
measure benchmarks and actual performance benchmarks would not be 
published until after the performance period.
    (A) CMS Web Interface submission uses benchmarks from the 
corresponding reporting year of the Shared Savings Program.
    (B) [Reserved]
    (iii) Separate benchmarks are used for the following submission 
mechanisms:
    (A) EHR submission options;
    (B) Administrative claims submission options;
    (C) QCDR and qualified registry submission options;
    (D) CMS Web Interface submission options;
    (E) Claims submission options.
    (iv) Minimum case requirements for quality measures are 20 cases, 
unless a measure is subject to an exception.
    (v) Exception. The minimum case requirements for the all-cause 
readmission measure is 200 cases.
    (vi) MIPS eligible clinicians failing to report a measure expected 
under this category receive zero points for that measure.
    (vii) MIPS eligible clinicians do not receive zero points if the 
expected measure is submitted (meeting the data completeness criteria) 
but is unable to be scored because it does not meet the required case 
minimum or if the measure does not have a measure benchmark.
    (viii) Measures that are not able to be scored would not be 
included for the MIPS quality performance category scoring.
    (ix) MIPS eligible clinicians are scored using a percentile 
distribution, separated by decile categories.
    (x) For each set of benchmarks, CMS calculates the decile breaks 
for measure performance and assigns points based on which benchmark 
decile range the MIPS eligible clinician's measure rate is between.
    (xi) CMS assigns partial points based on the percentile 
distribution.
    (xii) MIPS eligible clinicians are required to submit measures 
consistent with Sec.  414.1335.

[[Page 28387]]

    (xiii) Bonus points are available for measures determined to be 
high priority measures when two or more high priority measures are 
reported.
    (A) Bonus points are not available for the first reported high 
priority measure which is required to be reported. To qualify for bonus 
points, each measure must be reported with sufficient case volume to 
meet the required case minimum and does not have a zero percent 
performance rate, regardless of whether it is included in the 
calculation of the quality performance category score.
    (B) Outcome and patient experience measures receive two bonus 
points.
    (C) Other high priority measures receive one bonus point.
    (D) Bonus points for high priority measures cannot exceed 5 percent 
of the total possible points.
    (xiv) Bonus points are also available for each measure submitted 
with end-to-end electronic reporting for a quality measure under 
certain criteria determined by the Secretary. Bonus points cannot 
exceed 5 percent of the total possible points.
    (xv) A MIPS eligible clinician's quality performance score is the 
sum of all the points assigned for the measures required for the 
quality category criteria plus the bonus points in paragraph 
(b)(1)(xiii) and bonus points in paragraph (b)(1)(xiv) of this section. 
The sum is divided by the sum of total possible points.
    (2) Resource use performance category. MIPS eligible clinicians 
receive one to ten achievement points for each measure in the resource 
use performance category based on the MIPS eligible clinician's 
performance compared to applicable benchmarks.
    (i) Each MIPS resource use measure has a measure benchmark that is 
based on the performance period.
    (ii) Only measures meeting the required case minimum are scored 
under this category. Minimum case requirements for resource use 
measures are 20 cases.
    (iii) A MIPS eligible clinician's resource use performance category 
score is the equally-weighted average of all scored measures.
    (3) Clinical practice improvement activities (CPIA) performance 
category. MIPS eligible clinicians and groups receive points for CPIA 
based on patient-centered medical home or comparable specialty practice 
participation, APM participation, and CPIA reported by the MIPS 
eligible clinician in comparison to the highest potential score (60 
points) for a given MIPS year.
    (i) CMS assigns points for each reported CPIA within two weights: 
Medium-weighted; and high-weighted activities.
    (ii) CPIA with high weighting receive 20 points.
    (iii) CPIA with medium weighting receive 10 points.
    (iv) MIPS eligible clinician or group in a practice that is 
certified as a patient-centered medical home or comparable specialty 
practice, as determined by the Secretary, receives full credit for CPIA 
performance. For purposes of this paragraph (b)(3)(iv), ``full credit'' 
means that the MIPS eligible clinician or group has met the highest 
potential score. A practice is certified as a patient-centered medical 
home if it meets any of the following criteria:
    (A) The practice has received accreditation from one of four 
accreditation organizations that are nationally recognized;
    (1) The Accreditation Association for Ambulatory Health Care;
    (2) The National Committee for Quality Assurance (NCQA);
    (3) The Joint Commission; or
    (4) The Utilization Review Accreditation Commission (URAC).
    (B) The practice is a Medicaid Medical Home or Medical Home Model.
    (C) The practice is a comparable specialty practice that has 
received the NCQA Patient-Centered Specialty Recognition.
    (v) CMS compares the points associated with the reported activities 
against the CPIA highest potential score (60 points).
    (vi) A MIPS eligible clinician or group's CPIA category score is 
the sum of points for all of their reported activities divided by the 
CPIA highest potential score of 60 points.
    (vii) Non-patient-facing MIPS eligible clinicians and groups, small 
practices (consisting of 15 or fewer professionals), and practices 
located in rural areas and geographic HPSAs receive credit for CPIA by 
selecting one or two of any type of CPIA weighted activity.
    (A) For purposes of this paragraph (b)(3)(vii), ``credit'' is 
considered 50 percent of the total of 60 points for one activity of any 
weight, and 100 percent of the total of 60 points for two activities of 
any weight.
    (B) [Reserved]
    (4) Advancing care information performance category. (i) For the 
advancing care information performance category, MIPS eligible 
clinicians receive an overall performance category score equal to the 
sum of the base score, performance score and optional Public Health and 
Clinical Data Registry bonus point. The total score shall not exceed 
100 percent.
    (A) MIPS eligible clinicians earn a base score by reporting the 
numerator (of at least one)/denominator or yes/no statement as 
applicable (only a yes statement would qualify for credit under the 
base score) in the objectives and measures.
    (B) MIPS eligible clinicians earn percentage points towards the 
performance score by reporting on the eight associated measures under 
the Patient Electronic Access, Coordination of Care through Patient 
Engagement, and Health Information Exchange objectives.
    (C) MIPS eligible clinicians earn one additional bonus point for 
reporting any additional measures above the base score requirement for 
the Public Health and Clinical Data Registry objective.
    (ii) [Reserved]
    (c) Composite performance score (CPS) calculation. MIPS eligible 
clinicians receive a CPS of 0 to 100 points based on the sum of the 
products of each performance category's score and its assigned weight, 
multiplied by 100.
    (1) Performance category weights. The following are the performance 
category weights subject to CMS's authority to reweight the measure 
categories under section 1848(q)(5)(F) of the Act are defined as 
follows.
    (i) Quality performance category weight is defined under Sec.  
414.1330(b).
    (ii) Resource use performance category weight is defined under 
Sec.  414.1350(b).
    (iii) CPIA performance category weight is defined under Sec.  
414.1355(b).
    (iv) Advancing care information performance category weight: 25 
Percent for the 2019 MIPS payment year.
    (2) Calculating the CPS. (i) CMS applies category weights to each 
performance category score.
    (ii) CMS calculates the CPS according to its finalized formulas.
    (3) CMS reweights the performance category scores for MIPS eligible 
clinicians when they do not have sufficient applicable or available 
measures using the authority under section 1848(q)(5)(F) of the Act.
    (4) The CPS forms the basis for payment adjustments under this 
section. The CPS must be based on a minimum of two scored performance 
categories. If a MIPS eligible clinician only has one scored 
performance category, the MIPS eligible clinician is assigned a CPS 
that is equal to the performance threshold and the MIPS eligible 
clinician receives a MIPS adjustment factor of 0 percent for the year.

[[Page 28388]]

    (e) Scoring for APM entities. MIPS eligible clinician in APM 
entities that are subject to the APM scoring standard are scored using 
the method under Sec.  414.1370.


Sec.  414.1385  Targeted review and review limitations.

    (a) Targeted review. MIPS eligible clinicians or groups may request 
a targeted review of the calculation of the MIPS adjustment factor 
under section 1848(q)(6)(A) of the Act, and, as applicable the 
calculation of the additional MIPS adjustment factor under section 
1848(q)(6)(C) of the Act to such MIPS eligible clinician for a 
performance year. This review will be limited to the calculation of the 
MIPS adjustment factor and, as applicable, the additional MIPS 
adjustment factor for which we may find it necessary to review data 
related to measures and activities and the calculation of the CPS 
according to the defined methodology. The process for targeted reviews 
is:
    (1) A MIPS eligible clinician may submit their election to request 
a targeted review to CMS within 60 days (or a longer period specified 
by CMS) after the close of the data submission period. All requests for 
targeted review must be submitted by July 31 after the close of the 
data submission period or by a later date that we specify.
    (2) A response on whether or not a targeted review is warranted 
will be provided by CMS.
    (3) There will not be a hearing or evidence submission process, 
although the MIPS eligible clinician may submit information to assist 
in the review.
    (4) All decisions based on the targeted review will be final.
    (5) There will be no further review or appeal.
    (b) Limitations on review. Except as specified in paragraph (a)(4) 
of this section, there is no administrative or judicial review under 
section 1869 or 1879 of the Act, or otherwise of--
    (1) The methodology used to determine the amount of the MIPS 
adjustment factor and the amount of the additional MIPS adjustment 
factor and the determination of such amounts;
    (2) The establishment of the performance standards and the 
performance period;
    (3) The identification of measures and activities specified for a 
MIPS performance category and information made public or posted on a 
CMS public Web site; and
    (4) The methodology developed that is used to calculate performance 
scores and the calculation of such scores, including the weighting of 
measures and activities under such methodology.


Sec.  414.1390  Data validation and auditing.

    (a) General. CMS will selectively audit MIPS eligible clinicians on 
a yearly basis. If a MIPS eligible clinician or group is selected for 
audit, the MIPS eligible clinician or group is be required to do the 
following in accordance with applicable law:
    (1) Comply with data sharing requests, providing all data as 
requested by us or our designated entity. All data must be shared with 
CMS or our designated entity within 10 business days or an alternate 
time frame that is agreed to by CMS and the MIPS eligible clinician or 
group. Data will be submitted via email, facsimile, or an electronic 
method via a secure Web site maintained by CMS.
    (2) Provide substantive, primary source documents as requested. 
These documents may include: Copies of claims, medical records for 
applicable patients, or other resources used in the data calculations 
for MIPS measures, objectives, and activities. Primary source 
documentation also may include verification of records for Medicare and 
non-Medicare beneficiaries where applicable.
    (b) [Reserved]


Sec.  414.1395  Public reporting.

    (a) Public reporting of an MIPS eligible clinician's MIPS data. For 
each program year, CMS would post on a public Web site, in an easily 
understandable format, information regarding the performance of MIPS 
eligible clinicians or groups under the MIPS.
    (b) [Reserved]


Sec.  414.1400  Third party data submission.

    (a) General. (1) MIPS data may be submitted by third party 
intermediaries on behalf of a MIPS eligible clinician or group by:
    (i) A qualified registry;
    (ii) A QCDR;
    (iii) A health IT vendor that obtains data from a MIPS eligible 
clinician's CEHRT; or
    (iv) A CMS-approved survey vendor.
    (2) Qualified registries, QCDRs, and health IT vendors may submit 
data on measures, activities, or objectives for any of the following 
MIPS performance categories:
    (i) Quality;
    (ii) CPIA; or
    (iii) Advancing care information, if the MIPS eligible clinician or 
group is using CEHRT.
    (3) CMS-approved survey vendors may submit data for the CAHPS for 
MIPS survey under the MIPS quality performance category.
    (4) Third party intermediaries must meet all the requirements 
designated by CMS as a condition of their qualification or approval to 
participate in MIPS as a third party intermediary, including the 
following requirements:
    (i) For measures, activities, and objectives under the quality, 
advancing care information, and CPIA performance categories, if the 
data is derived from CEHRT, the QCDR, qualified registry, or health IT 
vendor must be able to indicate its data source.
    (ii) All submitted data must be submitted in the form and manner 
specified by CMS.
    (b) QCDR self-nomination requirements. QCDRs must self-nominate, 
for the 2017 performance period, from November 15, 2016 until January 
15, 2017. For future years of the program, starting with the 2018 
performance period, QCDRs must self-nominate from September 1 of the 
prior year until November 1 of the prior year. Entities that desire to 
qualify as a QCDR for the purposes of MIPS for a given performance 
period will need to self-nominate for that year and provide all 
information requested by CMS at the time of self-nomination. Having 
qualified as a QCDR does not automatically qualify the entity to 
participate in subsequent MIPS performance periods.
    (c) Establishment of a QCDR entity. For an entity to become 
qualified for a given performance period as a QCDR, the entity must:
    (1) Be in existence as of January 1 of the performance period for 
which the entity seeks to become a QCDR.
    (2) Have at least 25 participants by January 1 of the performance 
period.
    (d) Collaboration of entities to become a QCDR. In situations where 
an entity may not meet the requirements of a QCDR solely on its own but 
can do so in conjunction with another entity, the entity must also 
comply with the following:
    (1) An entity that uses an external organization for purposes of 
data collection, calculation, or transmission may meet the definition 
of a QCDR as long as the entity has a signed, written agreement that 
specifically details the relationship and responsibilities of the 
entity with the external organization effective as of September 1 the 
year prior to the year for which the entity seeks to become a QCDR.
    (2) Entities with a mere verbal, non-written agreement to work 
together to become a QCDR by September 1 of the year prior to the year 
for which the entity seeks to become a QCDR would not fulfill this 
requirement.
    (e) Identifying non-MIPS quality measures. For purposes of QCDRs 
submitting data for the MIPS quality

[[Page 28389]]

performance category, CMS considers the following types of quality 
measures to be non-MIPS quality measures:
    (1) A measure that is not contained in the annual list of MIPS 
quality measures for the applicable performance period.
    (2) A measure that may be in the annual list of MIPS quality 
measures but has substantive differences, as determined by the 
Secretary, in the manner it is reported by the QCDR.
    (3) CAHPS for MIPS survey.
    (f) QCDR measure specifications requirements. A QCDR must provide 
specifications for each measure, activity, or objective the QCDR 
intends to submit to CMS. The QCDR must provide CMS descriptions and 
narrative specifications for each measure, activity, or objective no 
later than January 15 of the applicable performance period for which 
the QCDR wishes to submit quality measures or other performance 
category (CPIA and advancing care information) data. In future years, 
starting with the 2018 performance period, those specifications must be 
provided to CMS by no later than November 1 prior to the applicable 
performance period for which the QCDR wishes to submit quality measures 
or other performance category (CPIA and advancing care information) 
data.
    (1) For non-MIPS quality measures, the quality measure 
specifications must include the following for each measure: Name/title 
of measures, NQF number (if NQF-endorsed), descriptions of the 
denominator, numerator, and when applicable, denominator exceptions, 
denominator exclusions, risk adjustment variables, and risk adjustment 
algorithms. The narrative specifications provided must be similar to 
the narrative specifications we provide in our measures list. CMS will 
consider all non-MIPS quality measures submitted by the QCDR but the 
measures must address a gap in care and outcome or other high priority 
measures are preferred. Documentation or ``check box'' measures are 
discouraged. Measures that have very high performance rates already or 
address extremely rare gaps in care (thereby allowing for little or no 
quality distinction between eligible clinicians) are also unlikely to 
be approved for inclusion.
    (2) For MIPS quality measures, the QCDR only needs to submit the 
MIPS measure numbers and/or specialty-specific measure sets (if 
applicable).
    (3) The QCDR must publicly post the measure specifications (no 
later than 15 days following CMS approval of the measure 
specifications) for each non-MIPS quality measure it intends to submit 
for MIPS. The QCDR may use any public format it prefers. Immediately 
following posting of the measures specification, the QCDR must provide 
CMS with the link to where this information is posted.
    (g) Qualified registry self-nomination requirements. Qualified 
registries must self-nominate, for the 2017 performance period from 
November 15, 2016 until January 15, 2017. For future years of the 
program, starting with the 2018 performance period, the qualified 
registry must self-nominate from September 1 of the prior year until 
November 1 of the prior year and provide all requested information to 
CMS at the time of self-nomination. Entities that desire to be a 
qualified registry for a given performance period will need to self-
nominate for that performance period. Having qualified as a qualified 
registry does not automatically qualify the entity to participate in 
subsequent MIPS performance periods.
    (h) Establishment of a qualified registry entity. In order for an 
entity to become qualified for a given performance period as a 
qualified registry, the entity must:
    (1) Be in existence as of January 1 the performance period for 
which the entity seeks to become a qualified registry.
    (2) Have at least 25 participants by January 1 of the performance 
period.
    (i) CMS-approved survey vendor application requirements. Vendors 
are required to undergo the CMS approval process for each year in which 
the survey vendor seeks to transmit survey measures data to CMS. All 
CMS-approved survey vendor applications and materials will be due by 
April 30 of the performance period.
    (j) Auditing of entities submitting MIPS data. Any third party 
intermediary (that is, a QCDR, health IT vendor, qualified registry, or 
CMS-approved survey vendor) must comply with the following requirements 
as a condition of their qualification or approval to participate in 
MIPS as a third party intermediary.
    (1) The entity must make available to CMS the contact information 
of each MIPS eligible clinician or group on behalf of whom it submits 
data. The contact information will include, at a minimum, the MIPS 
eligible clinician or group's practice phone number, address, and, if 
available, email.
    (2) The entity must retain all data submitted to CMS for MIPS for a 
minimum of 10 years.
    (k) Probation and disqualification of a third party intermediary. 
(1) If at any time we determine that a third party intermediary (that 
is, a QCDR, health IT vendor, qualified registry, or CMS-approved 
survey vendor) has not met all of the applicable requirements for 
qualification, CMS may place the third party intermediary on probation 
for the current performance period and/or the following performance 
period, as applicable.
    (2) CMS requires a corrective action plan from the third party 
intermediary to address any deficiencies or issues and prevent them 
from recurring. The corrective action plan must be received and 
accepted by CMS within 14 days of the CMS notification to the third 
party intermediary of the deficiency or probation. Failure to comply 
with this requirement will lead to disqualification from the MIPS 
program for the subsequent performance period.
    (3) Probation means that, for the applicable performance period, 
the third party intermediary is not allowed to miss any meetings or 
deadlines and will need to submit a corrective action plan for 
remediation or correction of any deficiencies identified by CMS that 
resulted in the probation.
    (4) If the third party intermediary has data inaccuracies including 
(but not limited to) TIN/NPI mismatches, formatting issues, calculation 
errors, data audit discrepancies affecting in excess of 3 percent (but 
less than 5 percent) of the total number of MIPS eligible clinicians or 
groups submitted by the third party intermediary, CMS will annotate on 
the CMS qualified posting that the entity furnished data of poor 
quality and will place the third party intermediary on probation for 
the subsequent MIPS performance period with the opportunity to go on 
probation for a year to correct deficiencies.
    (5) If the third party intermediary does not reduce their data 
error rate below 3 percent for the subsequent performance period, the 
third party intermediary will continue to be on probation and have 
their listing on the CMS Web site continue to note the poor quality of 
the data they are submitting for MIPS for one additional year. After 
two years on probation, the third party intermediary will be 
disqualified for the subsequent performance period.
    (6) In placing the third party intermediary on probation; CMS would 
notify the third party intermediary of the identified issues, at the 
time of discovery of such issues.
    (7) Data errors affecting in excess of 5 percent of the MIPS 
eligible clinicians or groups submitted by the third party intermediary 
may lead to the disqualification of the third party intermediary from 
participation in MIPS for the following performance period.
    (8) If the third party intermediary does not submit an acceptable 
corrective

[[Page 28390]]

action plan within 14 days of notification of deficiencies, and correct 
the deficiencies within 30 days or before the submission deadline--
whichever is sooner, CMS may disqualify the third party intermediary 
from participating in MIPS for the current performance period and/or 
the following performance period, as applicable.


Sec.  414.1405  Payment.

    (a) General. MIPS eligible clinicians receive payment adjustments 
based on their composite performance scores (CPS).
    (b) Performance threshold. The performance threshold for the 2019 
MIPS payment year is set at a level where approximately half of MIPS 
eligible clinicians fall below the threshold and approximately half are 
above it, as estimated by the Secretary.
    (c) Applicable percentage. Applicable percentage for MIPS payment 
year 2019 is 4 percent.
    (d) Linear sliding scale. The CPS is measured on a linear sliding 
scale between the negative applicable percentage and positive 
applicable percentage.
    (1) Exception. MIPS eligible clinicians with a CPS that fall 
between zero points and one-quarter of the performance threshold 
receive the negative applicable percentage.
    (2) MIPS eligible clinicians with a positive adjustment receive a 
payment against the applicable percentage and a scaling factor not to 
exceed 3.0.
    (e) Additional performance threshold. MIPS eligible clinicians with 
a CPS at least equal to the 25th percentile of the range of possible 
scores above the performance threshold, or the 25th percentile of the 
actual CPS at or above the performance threshold for the prior period 
used to determine the performance threshold, receive an additional 
positive adjustment factor for exceptional performance.
    (f) Linear sliding scale for additional payment adjustment. The CPS 
is measured on a linear sliding scale between 0.5 percent at the 
additional performance threshold and 10 percent at a CPS of 100. If 
necessary, the scale is adjusted downward by applying a scaling factor 
between 0 and 1 so that total dispersed payments are not expected to 
exceed $500,000,000 and the maximum payment adjustment would not exceed 
10 percent.


Sec.  414.1410  Advanced APM determination.

    (a) General. An Alternative Payment Model (APM) is an Advanced APM 
for a payment year if CMS determines that it meets the criteria in 
Sec.  414.1415 during the QP Performance Period.
    (b) Advanced APM determination process. (1) CMS identifies Advanced 
APMs and Other Payer Advanced APMs in the following manner:
    (i) Advanced APM determination. (A) No later than January 1, 2017, 
CMS will post on its Web site a list of all Advanced APMs for the first 
QP Performance Period.
    (B) CMS updates the Advanced APM list on its Web site at intervals 
no less than annually.
    (ii) Notwithstanding paragraph (b)(2) of this section, CMS includes 
notice of whether a new APM is an Advanced APM in the first public 
notice of the new APM.
    (2) Other Payer Advanced APM determination process. (i) CMS 
identifies Other Payer Advanced APMs following the QP performance 
period using information submitted to CMS according to Sec.  414.1445. 
CMS will not make determinations for other payer arrangements for which 
insufficient information is submitted.
    (ii) CMS makes early Other Payer Advanced APM determinations prior 
to QP determinations under Sec.  414.1440.
    (iii) CMS makes final Other Payer Advanced APM determinations and 
notifies Advanced APM Entities and eligible clinicians of such 
determinations as soon as practicable.


Sec.  414.1415  Advanced APM criteria.

    (a) Use of certified electronic health record technology. The 
following constitutes use of CEHRT:
    (1) Definition of certified EHR technology (CEHRT). For the 
purposes of the Advanced APM criteria, CMS uses the definition of CEHRT 
provided in the EHR performance category in MIPS and defined at Sec.  
414.1305.
    (2) Required use of certified EHR technology. To be an Advanced 
APM, an APM must:
    (i) Require at least 50 percent of eligible clinicians in each 
participating APM Entity group, or each hospital if hospitals are the 
APM Entities, to use CEHRT to document and/or communicate clinical care 
to their patients or other health care providers.
    (ii) For the Shared Savings Program, apply a penalty, reward, and/
or similar financial component to an APM Entity based on the degree of 
the use of CEHRT of the eligible clinicians in the APM Entity.
    (b) Payment based on quality measures. (1) To be an Advanced APM, 
an APM must include quality measure results as a factor in determining 
payment to APM Entities.
    (2) At least one of the quality measures upon which an Advanced APM 
bases the payment in paragraph (b)(1) of this section must have an 
evidence-based focus, be reliable and valid, and meet at least one of 
the following criteria:
    (i) Used in the MIPS quality performance category, as described in 
Sec.  414.1330.
    (ii) Endorsed by a consensus-based entity;
    (iii) Developed under section 1848(s) of the Act;
    (iv) Submitted in response to the MIPS Call for Quality Measures 
under section 1848(q)(2)(D)(ii) of the Act; or
    (v) Any other quality measures that CMS determines to have an 
evidence-based focus and be reliable and valid.
    (3) In addition to the quality measure requirements under paragraph 
(b)(2) of this section, the quality measures upon which an Advanced APM 
bases the payment in paragraph (b)(1) of this section must include at 
least one outcome measure. This requirement does not apply if CMS 
determines that there are no available or applicable outcome measures 
included in the MIPS quality measures list for the Advanced APM's first 
QP Performance Period.
    (c) Financial risk. To be an Advanced APM, an APM must either meet 
both the financial risk standard and nominal risk standard described in 
paragraphs (c)(1) and (c)(2) of this section or be an expanded Medical 
Home Model as described in paragraph (c)(5) of this section.
    (1) Financial risk standard. Except for paragraph (c)(1)(ii) of 
this section, to be an Advanced APM, an APM must, based on whether an 
APM Entity's actual expenditures for which the APM Entity is 
responsible under the APM exceed expected expenditures during a 
specified performance period do one or more of the following:
    (i) Withhold payment for services to the APM Entity or the APM 
Entity's eligible clinicians;
    (ii) Reduce payment rates to the APM Entity or the APM Entity's 
eligible clinicians; or
    (iii) Require the APM Entity to owe payment(s) to CMS.
    (2) Medical home financial risk standard. For an APM Entity owned 
and operated by an organization with fewer than 50 Clinicians whose 
Medicare billing rights have been reassigned to the TIN of the 
organization or any of the organization's subsidiary entities, the 
following standard applies instead of the standard set forth in 
paragraph (c)(1)(i) of this section. An APM Entity participates in a 
Medical Home Model that, based on the APM Entity's failure to meet or 
exceed one or more specified performance standards, does one or more of 
the following:

[[Page 28391]]

    (i) Withholds payment for services to the APM Entity or the APM 
Entity's eligible clinicians.
    (ii) Reduces payment rates to the APM Entity or the APM Entity's 
eligible clinicians.
    (iii) Requires the APM Entity to owe payment(s) to CMS.
    (iv) Causes the APM Entity to lose the right to all or part of an 
otherwise guaranteed payment or payments.
    (3) Nominal amount standard. (i) Except for risk arrangements 
described under paragraph (c)(3)(ii) of this section, the risk 
arrangement must have:
    (A) A marginal risk rate of at least 30 percent; and
    (B) Total potential risk of at least four percent of the expected 
expenditures.
    (ii) Medical home model nominal amount standard. For an APM Entity 
owned and operated by an organization with fewer than 50 eligible 
clinicians whose Medicare billing rights have been reassigned to the 
TIN of the organization or any of the organization's subsidiary 
entities, the following standard applies instead of the standard set 
forth in this paragraph (c)(3)(ii). For a Medical Home Model to be an 
Advanced APM, the minimum total annual amount that an APM Entity must 
potentially owe or forego under the APM must be:
    (A) In 2017, 2.5 percent of the APM Entity's total Medicare Parts A 
and B revenue;
    (B) In 2018, 3 percent of the APM Entity's total Medicare Parts A 
and B revenue.
    (C) In 2019, 4 percent of the APM Entity's total Medicare Parts A 
and B revenue.
    (D) In 2020 and later, 5 percent of the APM Entity's total Medicare 
Parts A and B revenue.
    (4) Marginal risk rate. For purposes of this section, the marginal 
risk rate is defined as the ratio of financial risk to the amount that 
actual expenditures exceed expected expenditures.
    (i) In the event that the marginal risk rate varies depending on 
the amount by which actual expenditures exceed expected expenditures, 
the lowest marginal risk rate across all possible levels of actual 
expenditures would be used for comparison to the marginal risk rate 
specified in paragraph (c)(3)(i)(A) of this section, with exceptions 
for large losses as described in paragraph (c)(4)(ii) of this section 
and small losses as described in paragraph (c)(4)(iii) of this section.
    (ii) Allowance for large losses. The determination in paragraph 
(c)(4)(i) of this section may disregard the marginal risk rates that 
apply in cases when actual expenditures exceed expected expenditures by 
an amount sufficient to require the APM Entity to make financial risk 
payments to CMS greater than or equal to the total risk requirement 
under paragraph (c)(3)(i)(B) of this section.
    (iii) Allowance for minimum loss rate. The determination in 
paragraph (c)(4)(i) of this section may disregard the marginal risk 
rates that apply in cases when actual expenditures exceed expected 
expenditures by less than 4 percent of expected expenditures.
    (5) Expected expenditures. For the purposes of this section, 
expected expenditures is defined as the APM benchmark, except for 
episode payment models, for which it is defined as the episode target 
price.
    (6) Capitation. A full capitation arrangement meets this Advanced 
APM criterion. For purposes of this subpart, a capitation arrangement 
means a payment arrangement in which a per capita or otherwise 
predetermined payment is made to an APM Entity for all items and 
services furnished to a population of beneficiaries, and no settlement 
is performed to reconcile or share losses incurred or savings earned by 
the APM Entity. Arrangements made between CMS and Medicare Advantage 
Organizations under the Medicare Advantage program (42 U.S.C. section 
422) are not considered capitation arrangements for purposes of this 
paragraph (c)(6).
    (7) Medical Home Model Expanded under section 1115A(c) of the Act. 
A Medical Home Model that has been expanded under section 1115A(c) of 
the Act meets the financial risk criterion under this section.


Sec.  414.1420  Other payer advanced APMs.

    (a) Other Payer Advanced APM criteria. A payment arrangement with a 
payer other than CMS is an Other Payer Advanced APM for a QP 
Performance Period if CMS determines that the arrangement meets the 
following criteria during the QP Performance Period:
    (1) Use of CEHRT, as described in paragraph (b) of this section;
    (2) Quality measures comparable to measures under the MIPS quality 
performance category apply, as described in paragraph (c) of this 
section; and
    (3) Either:
    (i) Requires APM Entities to bears more than nominal financial risk 
if actual aggregate expenditures exceed expected aggregate 
expenditures, as described in paragraph (d) of this section; or
    (ii) Is a Medicaid Medical Home Model that meets criteria 
comparable to Medical Home Models expanded under section 1115A(c) of 
the Act, as described in paragraph (d)(3) of this section.
    (b) Use of certified EHR technology (CEHRT). To be an Other Payer 
Advanced APM, another payer arrangement must require participants to 
use the CEHRT defined in paragraph (b)(1) of this section in the manner 
described in paragraph (b)(2) of this section.
    (1) For purposes of this Advanced APM criterion, CEHRT is defined 
at Sec.  414.1305.
    (2) Required use of certified EHR technology. To be an Other Payer 
Advanced APM, an APM must require at least 75 percent of eligible 
clinicians in each participating APM Entity group, or each hospital if 
hospitals are the APM Entities, to use CEHRT to document and/or 
communicate clinical care to their patients or other health care 
providers.
    (c) Other Payer Advanced APM quality measures. (1) To be an Other 
Payer Advanced APM, an Other Payer APM must apply quality measures 
comparable to measures under the MIPS quality performance category, as 
described in paragraph (c)(2) of this section.
    (2) At least one of the quality measures used in the arrangement 
with an APM Entity must have an evidence-based focus, be reliable and 
valid, and meet at least one of the following criteria:
    (i) Used in the MIPS quality performance category, as described in 
Sec.  414.1330;
    (ii) Endorsed by a consensus-based entity;
    (iii) Developed under section 1848(s) of the Act;
    (iv) Submitted in response to the MIPS Call for Quality Measures 
under section 1848(q)(2)(D)(ii) of the Act; or
    (v) Any other quality measures that CMS determines to have an 
evidence-based focus and are reliable and valid.
    (3) To meet the quality measure criterion, an Other Payer Advanced 
APM must use an outcome measure if there is an applicable outcome 
measure on the MIPS quality measure list. If an Other Payer Advanced 
APM has no outcome measure, the Advanced APM Entity must attest that 
there is no applicable outcome measure on the MIPS list.
    (d) Other Payer Advanced APM financial risk. To be an Other Payer 
Advanced APM, an Other Payer APM must meet either the criterion 
described in paragraph (d)(1) of this section or the criterion 
described in Sec.  414.1420(d)(3).
    (1) Other Payer Advanced APM financial risk standard. Except for 
APM Entities to which paragraph (d)(2) of this

[[Page 28392]]

section applies, to be an Other Payer Advanced APM an Other Payer APM 
must, if APM Entity actual aggregate expenditures exceed expected 
aggregate expenditures during a specified performance period:
    (i) Withhold payment for services to the APM Entity or the APM 
Entity's eligible clinicians;
    (ii) Reduce payment rates to the APM Entity or the APM Entity's 
eligible clinicians; or
    (iii) Require direct payment by the APM Entity to the payer.
    (2) Medicaid medical home financial risk standard. For an APM 
Entity owned and operated by an organization with fewer than 50 
eligible clinicians whose Medicare billing rights have been reassigned 
to the TIN of the organization or any of the organization's subsidiary 
entities, the following standard applies instead of the standard set 
forth in paragraph (c)(1)(i) of this section. The Advanced APM Entity 
participates in a Medicaid Medical Home Model that, based on the APM 
Entity's failure to meet or exceed one or more specified performance 
standards, does one or more of the following:
    (i) Withhold payment for services to the APM Entity or the APM 
Entity's eligible clinicians;
    (ii) Require direct payment by the APM Entity to the payer;
    (iii) Reduce payment rates to the APM Entity or the APM Entity's 
eligible clinicians, or
    (iv) Require the APM Entity to lose the right to all or part of an 
otherwise guaranteed payment or payments.
    (3) Other Payer Advanced APM nominal amount standard. (i) Except 
for risk arrangements described under paragraph (d)(2) of this section, 
the risk arrangement must have:
    (A) A marginal risk rate of at least 30 percent; and
    (B) Total potential risk of at least four percent of expected 
expenditures.
    (ii) Medicaid Medical Home Model nominal amount standard. For an 
APM Entity owned and operated by an organization with fewer than 50 
eligible clinicians whose Medicare billing rights have been reassigned 
to the TIN of the organization or any of the organizations subsidiary 
entities, the following standard applies instead of the standard set 
forth in paragraph (d)(1) of this section. For Medicaid Medical Home 
Models, the minimum total annual amount that an APM Entity must 
potentially owe or forego under the APM must be:
    (A) In 2019, 4 percent of the APM Entity's total Medicare Parts A 
and B revenue.
    (B) In 2020 and later, 5 percent of the APM Entity's total Medicare 
Parts A and B revenue.
    (4) Marginal risk rate. For purposes of this section, the marginal 
risk rate is defined as the ratio of financial risk to the amount that 
actual expenditures exceed expected expenditures.
    (i) In the event that the marginal risk rate varies depending on 
the amount by which actual expenditures exceed expected expenditures, 
the lowest marginal risk rate across all possible levels of actual 
expenditures would be used for comparison to the marginal risk rate 
specified in paragraph (d)(3)(i)(A) of this section, with exceptions 
for large losses as described in paragraph (d)(4)(ii) of this section 
and small losses as described in paragraph (d)(4)(iii) of this section.
    (ii) Allowance for large losses. The determination in paragraph 
(d)(4)(i) of this section may disregard the marginal risk rates that 
apply in cases when actual expenditures exceed expected expenditures by 
an amount sufficient to require the APM Entity to make financial risk 
payments under the Other Payer Advanced APM greater than or equal to 
the total risk requirement under paragraph (d)(3)(i)(B) of this 
section.
    (iii) Allowance for minimum loss rate. The determination in 
paragraph (d)(4)(i) of this section may disregard the marginal risk 
rates that apply in cases when actual expenditures exceed expected 
expenditures by less than 4 percent of expected expenditures.
    (5) Expected expenditures. For the purposes of this section, 
expected expenditures is defined as the Other Payer APM benchmark, 
except for episode payment models, for which it is defined as the 
episode target price.
    (6) Capitation. A capitation arrangement meets this Other Payer 
Advanced APM criterion. For purposes of paragraph (d)(3) of this 
section, a capitation arrangement means a payment arrangement in which 
a per capita or otherwise predetermined payment is made to an APM 
Entity for services furnished to a population of beneficiaries, and no 
settlement is performed for the purpose of reconciling or sharing 
losses incurred or savings earned by the APM Entity. Arrangements made 
directly between CMS and Medicare Advantage Organizations under the 
Medicare Advantage program (42 U.S.C. 422) are not considered 
capitation arrangements for purposes of this paragraph (d)(6).
    (7) Comparability to expanded Medical Home Model. (i) The financial 
risk criterion under Sec.  414.1420(d) is met for a Medicaid Medical 
Home Model if CMS determines that it has characteristics that are 
comparable to any Medical Home Model expanded under section 1115A(c) of 
the Act.
    (ii) For each Medical Home Model that is expanded under section 
1115A(c) of the Act, CMS will publish the characteristics of such 
models against which Medicaid Medical Home Models will be compared 
under paragraph (a) of this section through notice and comment 
rulemaking.


Sec.  414.1425  Qualifying APM participant determination: In general.

    (a) QP Performance Period. The QP Performance Period for a payment 
year is the period of time during which CMS assesses claims to make a 
QP determination under this Sec.  414.1425. The QP Performance Period 
for a payment year is the calendar year that ends 1 year and 1 day 
before the payment year.
    (b) Advanced APM Entity group determination. Except for Sec.  
414.1445, for purposes of determining QPs for a year, eligible 
clinicians are grouped and assessed through their collective 
participation in an Advanced APM Entity, as described in Sec.  
414.1305. To be included in the eligible clinician group defined by an 
Advanced APM Entity for purposes of the QP determination, an eligible 
clinician's APM participant identifier must be present on a 
Participation List on December 31 of the QP Performance Period:
    (1) Participation List. For Advanced APMs that include a 
Participation List that can be used to identify eligible clinicians, 
the Participation List will be the APM Entity group for the QP 
determination.
    (2) Affiliated Practitioner List. For Advanced APMs that do not 
include a Participation List that can be used to identify eligible 
clinicians and do include an Affiliated Practitioner List, the 
Affiliated Practitioner List will be the APM Entity group for the QP 
determination.
    (c) QP determination. (1) CMS makes QP determinations in accordance 
with the methods set forth in Sec. Sec.  414.1435 and 414.1440.
    (2) An eligible clinician cannot be both a QP and a Partial QP for 
a year. A determination that an eligible clinician is a QP means that 
the eligible clinician is not a Partial QP.
    (3) An eligible clinician is a QP for a year if the eligible 
clinicians that constitute the group for the QP Determination under 
paragraph (b) of this section for an Advanced APM Entity collectively 
achieve a Threshold Score that meets or exceeds the corresponding QP 
threshold for that

[[Page 28393]]

year, as described in Sec.  414.1430(a)(1), (3), (b)(1) and (3).
    (4) Notwithstanding paragraph (c)(3) of this section, an eligible 
clinician is a QP for a year if:
    (i) The eligible clinician is grouped with eligible clinicians for 
the QP Determination pursuant to paragraph (b) of this section for more 
than one Advanced APM Entity;
    (ii) None of the eligible clinician's Advanced APM Entity eligible 
clinician groups meets the QP threshold; and
    (iii) CMS determines that the eligible clinician individually 
achieves a Threshold Score that meets or exceeds the corresponding QP 
threshold.
    (5) An eligible clinician is a Partial QP for a year if the 
eligible clinician group used for the QP Determination pursuant to 
paragraph (b) of this section collectively achieves a Threshold Score 
that meets or exceeds the corresponding Partial QP threshold for that 
year, as described in Sec.  414.1430(a)(2), (4), (b)(2), and (4).
    (6) Notwithstanding paragraph (c)(5) of this section, an eligible 
clinician is a Partial QP for a year if:
    (i) The eligible clinician is grouped with eligible clinicians for 
the QP Determination pursuant to Sec.  414.1425(b) for more than one 
Advanced APM Entity;
    (ii) None of the eligible clinician's Advanced APM Entity eligible 
clinician groups meets the QP or Partial QP threshold; and
    (iii) CMS determines that the eligible clinician individually 
achieves a Threshold Score that meets or exceeds the corresponding 
Partial QP threshold.
    (d) Notification of QP determination. CMS notifies eligible 
clinicians determined to be QPs or Partial QPs for a year as soon as 
practicable following the end of the QP Performance Period. CMS may 
inform all eligible clinicians determined to be QPs collectively 
through their APM Entity determined to be an Advanced APM Entity.
    (e) Order of threshold options. (1) For payment years 2019 and 
2020, CMS performs QP determinations for an eligible clinicians only 
under the Medicare Option described in Sec.  414.1435.
    (2) For payment years 2021 and later, CMS performs QP 
determinations for eligible clinicians under the Medicare Option, as 
described in Sec.  414.1435 and, except for (i) and (ii), the All-Payer 
Combination Option, described in Sec.  414.1440.
    (i) If CMS determines the eligible clinician or group of eligible 
clinicians to be a QP under the Medicare Option, then CMS does not 
perform a QP determination for such eligible clinician(s) under the 
All-Payer Combination Option.
    (ii) If the Threshold Score for an eligible clinician or eligible 
clinician group under the Medicare Option is less than the amount in 
Sec.  414.1430(b)(2)(ii) and (b)(3)(iii), then CMS does not perform a 
QP determination for such eligible clinician(s) under the All-Payer 
Combination Option.


Sec.  414.1430  Qualifying APM participant determination: QP and 
partial QP thresholds.

    (a) Medicare Option--(1) QP payment amount threshold. The QP 
payment amount thresholds are the following values for the indicated 
payment years:
    (i) 2019 and 2020: 25 percent.
    (ii) 2021 and 2022: 50 percent.
    (iii) 2023 and later: 75 percent.
    (2) Partial QP payment amount threshold. The Partial QP payment 
amount thresholds are the following values for the indicated payment 
years:
    (i) 2019 and 2020: 20 percent.
    (ii) 2021 and 2022: 40 percent.
    (ii) 2023 and later: 50 percent.
    (3) QP patient count threshold. The QP patient count thresholds are 
the following values for the indicated payment years:
    (i) 2019 and 2020: 20 percent.
    (ii) 2021 and 2022: 35 percent.
    (ii) 2023 and later: 50 percent.
    (4) Partial QP patient count threshold. The Partial QP patient 
count thresholds are the following values for the indicated payment 
years:
    (i) 2019 and 2020: 10 percent.
    (ii) 2021 and 2022: 25 percent.
    (iii) 2023 and later: 35 percent.
    (b) All-Payer Combination Option--(1) QP payment amount threshold. 
(i) The QP payment amount thresholds are the following values for the 
indicated payment years:
    (A) 2021 and 2022: 50 percent.
    (B) 2023 and later: 75 percent.
    (ii) To meet the QP payment amount threshold under this option, the 
eligible clinician group or eligible clinician must also meet a 25 
percent QP payment amount threshold under the Medicare Option.
    (2) Partial QP payment amount threshold. (i) The Partial QP payment 
amount thresholds are the following values for the indicated payment 
years:
    (A) 2021 and 2022: 40 percent.
    (B) 2023 and later: 50 percent.
    (ii) To meet the QP payment amount threshold under this option, the 
eligible clinician group or eligible clinician must also meet a 20 
percent Partial QP payment amount threshold under the Medicare Option.
    (3) QP patient count threshold. (i) The QP patient count thresholds 
are the following values for the indicated payment years:
    (A) 2021 and 2022: 35 percent.
    (B) 2023 and later: 50 percent.
    (ii) To meet the QP patient count threshold under this option, the 
eligible clinician group or eligible clinician must also meet a 20 
percent QP patient count threshold under the Medicare Option.
    (4) Partial QP patient count threshold. (i) The Partial QP patient 
count thresholds are the following values for the indicated payment 
years:
    (A) 2021 and 2022: 25 percent.
    (B) 2023 and later: 35 percent.
    (ii) To meet the Partial QP patient count threshold under this 
option, the eligible clinician group or eligible clinician must also 
meet a 10 percent QP patient count threshold under the Medicare Option.


Sec.  414.1435  Qualifying APM participant determination: Medicare 
option.

    (a) Payment amount method. The Threshold Score for an eligible 
clinician group or eligible clinician is calculated as a percent by 
dividing the value described under paragraph (a)(1) of this section by 
the value described under paragraph (a)(2) of this section.
    (1) Numerator. The aggregate of all payments for Medicare Part B 
covered professional services furnished by the APM Entity group or 
eligible clinician to attributed beneficiaries during the QP 
Performance Period.
    (2) Denominator. The aggregate of all payments for Medicare Part B 
covered professional services furnished by the APM Entity group or 
eligible clinician to all attribution-eligible beneficiaries during the 
QP Performance Period.
    (3) Claims and adjustments. In the calculation under paragraph (2), 
CMS compiles claims and treats claims adjustments, supplemental service 
payments, and alternative payment methods in the same manner as 
described in Sec.  414.1450.
    (b) Patient count method. The threshold score for an APM Entity 
group or eligible clinician is calculated as a percent under the 
patient count method by dividing the value described under paragraph 
(b)(1) of this section by the value described under paragraph (b)(2) of 
this section.
    (1) Numerator. The number of attributed beneficiaries to whom the 
APM Entity group or eligible clinician furnishes Medicare Part B 
covered professional services during the QP Performance Period.
    (2) Denominator. The number of attribution-eligible beneficiaries 
to whom the APM Entity group or eligible clinician furnish Medicare 
Part B

[[Page 28394]]

covered professional services during the QP Performance Period.
    (3) Unique beneficiaries. For each APM Entity group or eligible 
clinician, a unique Medicare beneficiary is counted no more than one 
time for the numerator and no more than one time for the denominator.
    (4) Beneficiaries count multiple times. CMS may count a single 
Medicare beneficiary in the numerator and/or denominator for multiple 
different Advanced APM Entities or eligible clinicians.
    (c) Attribution. (1) Attributed beneficiaries are determined from 
Advanced APM attribution lists generated by each Advanced APM's 
specific attribution methodology.
    (2) When operationally feasible, this attributed beneficiary list 
will be the final beneficiary list used for reconciliation purposes in 
the Advanced APM.
    (3) When it is not operationally feasible to use the final 
attributed beneficiary list, the attributed beneficiary list will be 
taken from the Advanced APM's most recently available attributed 
beneficiary list at the end of the QP Performance Period.
    (d) Participation in multiple Advanced APMs. If the same Advanced 
APM Entity participates in multiple Advanced APMs and if at least one 
of those Advanced APMs is an episode payment model, the numerator of 
the episode payment model Advanced APM Entity will be added to the non-
episode payment model Advanced APM Entities' numerator(s), regardless 
of whether eligible clinicians are identifiable on a Participation List 
or Affiliated Practitioner List for the Advanced APM Entity. For 
purposes of this provision, Advanced APM Entities are considered the 
same if CMS determines that the Participation Lists are substantially 
similar or if one Advanced APM Entity is a subset of the other.
    (e) Use of methods. CMS calculates threshold scores for an Advanced 
APM Entity under both the payment amount and patient count methods for 
each QP Performance Period. CMS then assigns the higher of the two 
scores to the Advanced APM Entity.


Sec.  414.1440  Qualifying APM participant determination: All-payer 
combination option.

    (a) Payments excluded from calculations. (1) These calculations 
include a combination of both Medicare payments for Part B covered 
professional services and all other payments for all other payers, 
except payments made by:
    (i) The Secretary of Defense for the costs of Department of Defense 
health care programs.
    (ii) The Secretary of Veterans Affairs for the cost of Department 
of Veterans Affairs health care programs.
    (iii) Under Title XIX in a state in which no Medicaid Medical Home 
Model or APM is available.
    (2) Title XIX payments will only be included in the numerator 
(paragraph (b)(2) of this section) and denominator (paragraph (b)(3) of 
this section) for an Advanced APM Entity if:
    (i) A state has at least one Medicaid Medical Home Model (as 
defined in Sec.  414.1305) or Medicaid APM (as defined in Sec.  
414.1305) in operation that is determined to be an Other Payer Advanced 
APM; and
    (ii) The Advanced APM Entity is eligible to participate in at least 
one of such Other Payer Advanced APMs during the QP Performance Period, 
regardless of whether the Advanced APM Entity actually participates in 
such Other Payer Advanced APMs. This will apply to both the payment 
amount and patient count methods.
    (b) Payment amount method--(1) In general. The threshold score for 
an Advanced APM Entity or eligible clinician will be calculated by 
dividing the value described under the numerator (paragraph (b)(2) of 
this section) by the value described under the denominator (paragraph 
(b)(3) of this section).
    (2) Numerator. The aggregate of all payments from all payers, 
except those excluded under paragraph (a) of this section, to the 
Advanced APM Entity group or eligible clinician under the terms of 
Other Payer Advanced APMs during the QP Performance Period. CMS 
calculates Medicare Part B covered professional services under the All-
Payer Combination Option in the same manner as it is calculated under 
the Medicare Option.
    (3) Denominator. The aggregate of all payments from all payers, 
except those excluded under Sec.  414.1440(a), to the Advanced APM 
Entity group or eligible clinician during the QP Performance Period. 
The portion of this amount that relates to Medicare Part B covered 
professional services is calculated under the All-Payer Combination 
Option in the same manner as it is calculated under the Medicare 
Option.
    (c) Patient count method--(1) In general. The Threshold Score for 
an Advanced APM Entity group or eligible clinician is calculated by 
dividing the value described under the numerator (paragraph (c)(2) of 
this section) by the value described under the denominator (paragraph 
(c)(3) of this section).
    (2) Numerator. The number of unique patients to whom the Advanced 
APM Entity group or eligible clinician furnishes services that are 
included in the measures of aggregate expenditures used under the terms 
of all of their Other Payer Advanced APMs during the QP Performance 
Period, plus the patient count numerator under Sec.  414.1435(a)(1).
    (3) Denominator. The number of unique patients to whom eligible 
clinicians in the Advanced APM Entity furnish services under all non-
excluded payers during the QP Performance Period.
    (d) Participation in multiple Other Payer Advanced APMs. (1) For 
each APM Entity group or eligible clinician, a unique patient is 
counted no more than one time for the numerator and no more than one 
time for the denominator for each payer.
    (2) CMS may count a single patient in the numerator and/or 
denominator for multiple different Advanced APM Entities or eligible 
clinicians.
    (3) If the same Advanced APM Entity participates in two or more 
Other Payer Advanced APMs and at least one of those Other Payer 
Advanced APMs is an episode payment model, the numerator of the episode 
payment model Advanced APM Entity would be added to the non-episode 
payment model Advanced APM Entities' numerator(s), regardless of 
whether eligible clinicians are on the Participation List or Affiliated 
Practitioner List for an Advanced APM Entity.
    (4) For purposes of this section, Advanced APM Entities are 
considered the same entity across Other Payer Advanced APMs if CMS 
determines that the Participation Lists are substantially similar or if 
one entity is a subset of the other.


Sec.  414.1445  Identification of other payer advanced APMs.

    (a) Identification of Medicaid APMs. For APM Entities and eligible 
clinicians participating in Medicaid, CMS makes an annual determination 
prior to the performance period of the existence of Medicaid Medical 
Home Models and Medicaid APMs, as defined in Sec.  414.1305, in a state 
based on information obtained from state Medicaid agencies and other 
relevant sources.
    (b) Obtaining data to calculate the threshold score under the All-
Payer Combination Option. To be assessed under the All-Payer 
Combination Option, APM Entities or eligible clinicians must submit the 
following information for each payer in a manner and by a date 
specified by CMS:

[[Page 28395]]

    (1) Payment arrangement information necessary to assess the Other 
Payer APM on all Other Payer Advanced APM criteria under Sec.  
414.1420;
    (2) For each Other Payer APM, the amount of revenues for services 
furnished through the arrangement, the total revenues from the payer, 
the numbers of patients furnished any service through the arrangement, 
and the total numbers of patients furnished any service through the 
payer.
    (3) An attestation from the payer that the submitted information is 
accurate.
    (c) Outcome measure. An Other Payer Advanced APM is required to 
have payment based on at least one outcome measure.
    (1) If an Other Payer Advanced APM has no outcome measure, the 
Advanced APM Entity must submit an attestation in a manner and by a 
date determined by CMS that there is no applicable outcome measure on 
the MIPS list of quality measures.
    (2) Failure to submit adequate information. (i) CMS makes a QP 
determination with respect to the individual eligible clinician under 
the All-Payer Combination Option if:
    (A) The eligible clinician's Advanced APM Entity submits the 
information required under this section for CMS to assess the APM 
Entity group under the All-Payer Combination Option; and
    (B) The eligible clinician submits adequate information under this 
section.
    (ii) If neither the Advanced APM Entity nor the eligible clinician 
submit the information required under this section, then CMS does not 
make a QP assessment for such eligible clinician under the All-Payer 
Combination Option.


Sec.  414.1450  APM incentive payment.

    (a) In general. (1) CMS makes a lump sum payment to QPs in the 
amount described in paragraph (b) of this section in the manner 
described in paragraphs (d) and (e) of this section
    (2) CMS provides notice of the amount of the APM Incentive Payment 
to QPs as soon as practicable following the calculation and validation 
of the APM Incentive Payment amount, but in any event no later than 1 
year after the incentive payment base period.
    (b) APM Incentive Payment amount. (1) The amount of the APM 
Incentive Payment is equal to 5 percent of the estimated aggregate 
payments for covered professional services as defined in section 
1848(k)(3)(A) of the Act, furnished during the year immediately 
preceding the payment year.
    (2) The estimated aggregate payment amount for covered professional 
services includes all such payments to any and all of the TIN/NPI 
combinations associated with the NPI of the QP.
    (3) The incentive payment base period, as defined in Sec.  
414.1305, is the entire calendar year immediately preceding the payment 
year.
    (4) In calculating the estimated aggregate payment amount for a QP, 
CMS uses claims submitted with dates of service from January 1 through 
December 31 of the incentive payment base period, and processing dates 
of January 1 of the base period through March 31 of the subsequent 
payment year.
    (5) Adjustments, such as use of a completion factor, are not made 
to the estimated aggregate payment amount.
    (6) The payment adjustment amounts, negative or positive, as 
described in sections 1848(m), (o), (p), and (q) of the Act are not 
included in calculating the APM Incentive Payment amount.
    (7) Incentive payments made to eligible clinicians under sections 
1833(m), (x), and (y) of the Act are not included in calculating the 
APM Incentive Payment amount.
    (8) Financial risk payments such as shared savings payments or net 
reconciliation payments are excluded from the amount of covered 
professional services in calculating the APM Incentive Payment amount.
    (9) Supplemental service payments in the amount of covered 
professional services are included in calculating the APM Incentive 
Payment amount according to this paragraph (b). Supplemental service 
payments are included in the amount of covered professional services 
when calculating the APM Incentive Payment amount when the supplemental 
service payment meets the following four criteria:
    (i) Is payment for services that constitute physicians services 
authorized under section 1832(a) and defined under section 1861(s) of 
the Act.
    (ii) Is made for only Part B services under the criterion in 
paragraph (b)(9)(i) of this section.
    (iii) Is directly attributable to services furnished to an 
individual beneficiary.
    (iv) Is directly attributable to an eligible clinician, including 
an eligible clinician that is a group of individual eligible 
clinicians.
    (v) For payment amounts that are affected by a cash flow mechanism, 
the payment amounts that would have occurred if the cash flow mechanism 
were not in place are used in calculating the APM Incentive Payment 
amount.
    (c) Incentive payment recipient. (1) CMS pays the entire APM 
Incentive Payment amount to the TIN associated with the QP's 
participation in the Advanced APM entity that met the applicable QP 
threshold during the QP Performance Period.
    (2) In the event that an eligible clinician is no longer affiliated 
with the TIN associated with the QP's participation in the Advanced APM 
Entity that met the applicable QP threshold during the QP Performance 
Period, CMS makes the APM Incentive Payment to the TIN listed on the 
eligible clinician's CMS-588 EFT Application form.
    (3) In the event that an eligible clinician becomes a QP through 
participation in multiple Advanced APMs, as described in Sec.  
414.1425(c)(4)(iii), CMS divides the APM Incentive Payment amount 
between the TINs associated with the QP's participation in each 
Advanced APM during the QP Performance Period. Such payments will be 
divided in proportion to the amount of payments associated with each 
TIN that the eligible clinician received for covered professional 
services during the QP Performance Period.
    (d) Timing of the incentive payment. APM Incentive Payments made 
under this section are made as soon as practicable following the 
calculation and validation of the APM Incentive Payment amount, but in 
any event no later than 1 year after the incentive payment base period.
    (e) Treatment of incentive payment amount in APMs. (1) APM 
Incentive Payments made under this section are not included in 
determining actual expenditures under an APM.
    (2) APM Incentive Payments made under this section will not be 
included in calculations for the purposes of rebasing benchmarks in an 
APM.
    (f) Treatment of incentive payment amount in other Medicare 
incentive payments and payment adjustments. Incentive payments made 
under this section will not be included in determining the amount of 
incentive payment made to eligible clinicians under section 1833(m), 
(x), and (y) of the Act.


Sec.  414.1455  Limitation on review.

    There is no administrative or judicial review under sections 1869, 
1878, or otherwise, of the Act of the following:
    (a) The determination that an eligible clinician is a QP under 
Sec.  414.1425 and the determination that an APM Entity is an Advanced 
APM Entity under Sec.  414.1410.
    (b) The determination of the amount of the APM Incentive Payment 
under Sec.  414.1450, including any estimation as part of such 
determination.

[[Page 28396]]

Sec.  414.1460  Monitoring and program integrity.

    (a) Vetting eligible clinicians prior to payment of the APM 
Incentive Payment. Prior to payment of the APM Incentive Payment, CMS 
determines if eligible clinicians are in compliance with all Medicare 
conditions of participation and the terms of the relevant Advanced APMs 
in which they participate during the QP Performance Period. For QPs not 
meeting these standards there may be a reduction or denial of the APM 
Incentive Payment. A determination under this provision is not binding 
for other purposes.
    (b) Termination by Advanced APMs. CMS may reduce or deny an APM 
Incentive Payment to Advanced APM Entities or eligible clinicians who 
are terminated by APMs for non-compliance with all Medicare conditions 
of participation or the terms of the relevant Advanced APMS in which 
they participate during the QP Performance Periods.
    (c) Information submitted for All-Payer Combination Option. 
Information submitted by eligible clinicians or Advanced APM Entities 
to meet the requirements of the All-Payer Combination Option may be 
subject to audit by CMS. Eligible clinicians and Advanced APM Entities 
must maintain copies of any supporting documentation related to All-
Payer Combination Option for at least 10 years. The APM Incentive 
Payment will be recouped if an audit reveals a lack of support for 
attested statements provided by eligible clinicians and Advanced APM 
Entities.
    (d) Recoupment of APM Incentive Payment. For any QPs who are 
terminated from an Advanced APM or found to be in violation of any 
Federal, state, or tribal laws or regulations during the QP Performance 
Period or Incentive Payment Base Period or terminated after these 
periods as a result of a violation occurring during the periods, CMS 
may rescind such eligible clinicians' QP determinations and, if 
necessary, recoup part or all of such eligible clinicians' APM 
Incentive Payments or deduct such amounts from future payments to such 
individuals. CMS may reopen and recoup any payments that were made in 
error in accordance with procedures similar to those set forth at 42 
CFR 405.980 and 42 CFR 405.370 through 405.379 or established under the 
relevant APM.
    (e) Maintenance of records. An Advanced APM Entity or eligible 
clinician that submits information to CMS under Sec.  414.1445 for 
assessment under the All-Payer Combination Option must maintain such 
books contracts, records, documents, and other evidence for a period of 
10 years from the final date of the QP Performance Period or from the 
date of completion of any audit, evaluation, or inspection, whichever 
is later, unless--
    (1) CMS determines there is a special need to retain a particular 
record or group of records for a longer period and notifies the 
Advanced APM Entity of eligible clinician at least 30 days before the 
formal disposition date; or
    (2) There has been a termination, dispute, or allegation of fraud 
or similar fault against the Advanced APM Entity or eligible clinician, 
in which case the Advanced APM Entity or eligible clinician must retain 
records for an additional 6 years from the date of any resulting final 
resolution of the termination, dispute, or allegation of fraud or 
similar fault.
    (f) OIG authority. None of the provisions of this part limit or 
restrict OIG's authority to audit, evaluate, investigate, or inspect 
the Advanced APM Entity, its eligible clinicians, and other individuals 
or entities performing functions or services related to its APM 
activities.


Sec.  414.1465  Physician-focused payment models.

    (a) Definition. A physician-focused payment model is an Alternative 
Payment Model wherein Medicare is a payer, which includes physician 
group practices or individual physicians as APM Entities and targets 
the quality and costs of physician services.
    (b) Criteria. In carrying out its review of physician-focused 
payment model proposals, the PTAC shall assess whether the physician-
focused payment model meets the following criteria for PFPMs sought by 
the Secretary. The Secretary seeks physician-focused payment models 
that:
    (1) Incentives: Pay for higher-value care. (i) Value over volume: 
Provide incentives to practitioners to deliver high-quality health 
care.
    (ii) Flexibility: Provide the flexibility needed for practitioners 
to deliver high-quality health care.
    (ii) Quality and Cost: Are anticipated to improve health care 
quality at no additional cost, maintain health care quality while 
decreasing cost, or both improve health care quality and decrease cost.
    (iv) Payment methodology: Pay APM Entities with a payment 
methodology designed to achieve the goals of the PFPM Criteria. 
Addresses in detail through this methodology how Medicare, and other 
payers if applicable, pay APM Entities, how the payment methodology 
differs from current payment methodologies, and why the Physician-
Focused Payment Model cannot be tested under current payment 
methodologies.
    (v) Scope: Aim to either directly address an issue in payment 
policy that broadens and expands the APM portfolio or include APM 
Entities whose opportunities to participate in APMs have been limited.
    (vi) Ability to be evaluated: Have evaluable goals for quality of 
care, cost, and any other goals of the Physician-focused Payment Model.
    (2) Care delivery improvements: Promote better care coordination, 
protect patient safety, and encourage patient engagement. (i) 
Integration and Care Coordination: Encourage greater integration and 
care coordination among practitioners and across settings where 
multiple practitioners or settings are relevant to delivering care to 
the population treated under the Physician-focused Payment Model.
    (ii) Patient Choice: Encourage greater attention to the health of 
the population served while also supporting the unique needs and 
preferences of individual patients.
    (iii) Patient Safety: Aim to maintain or improve standards of 
patient safety.
    (3) Information Enhancements: Improving the availability of 
information to guide decision-making. (i) Health Information 
Technology: Encourage use of health information technology to inform 
care.
    (ii) [Reserved]

PART 495--STANDARDS FOR THE ELECTRONIC HEALTH RECORD TECHNOLOGY 
INCENTIVE PROGRAM

0
4. The authority citation for part 495 continues to read as follows:

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 
U.S.C. 1302 and 1395hh).

0
5. Section 495.4 is amended by revising the definition of ``Meaningful 
EHR user'' to read as follows:


Sec.  495.4  Definitions.

* * * * *
    Meaningful EHR user means--
    (1) Subject to paragraph (3) of this definition, an EP, eligible 
hospital or CAH that, for an EHR reporting period for a payment year or 
payment adjustment year, demonstrates in accordance with Sec.  495.40 
meaningful use of certified EHR technology by meeting the applicable 
objectives and associated measures under Sec. Sec.  495.20, 495.22, and 
495.24, supporting information exchange and the prevention of health 
information blocking and cooperating with the authorized surveillance 
of health

[[Page 28397]]

information technology, and successfully reporting the clinical quality 
measures selected by CMS to CMS or the States, as applicable, in the 
form and manner specified by CMS or the States, as applicable; and
    (2)(i) Except as specified in paragraph (2)(ii) of this definition, 
a Medicaid EP or Medicaid eligible hospital, that meets the 
requirements of paragraph (1) of this definition and any additional 
criteria for meaningful use imposed by the State and approved by CMS 
under Sec. Sec.  495.316 and 495.332.
    (ii) An eligible hospital or CAH is deemed to be a meaningful EHR 
user for purposes of receiving an incentive payment under subpart D of 
this part, if the hospital participates in both the Medicare and 
Medicaid EHR incentive programs, and the hospital meets the 
requirements of paragraph (1) of this definition.
    (3) To be considered a meaningful EHR user, at least 50 percent of 
an EP's patient encounters during an EHR reporting period for a payment 
year (or, in the case of a payment adjustment year, during an 
applicable EHR reporting period for such payment adjustment year) must 
occur at a practice/location or practices/locations equipped with 
certified EHR technology.
* * * * *
0
6. Section 495.40 is amended by--
0
a. Revising paragraph (a) introductory text.
0
b. Revising paragraphs (a)(2)(i)(E) and (F).
0
c. Adding paragraphs (a)(2)(i)(G), (H) and (I) and (b)(2)(i)(H) and 
(I).
    The revision and additions read as follows:


Sec.  495.40  Demonstration of meaningful use criteria.

    (a) Demonstration by EPs. An EP must demonstrate that he or she 
satisfies each of the applicable objectives and associated measures 
under Sec.  495.20 or Sec.  495.24, supported information exchange and 
the prevention of health information blocking, and cooperated with 
authorized surveillance of health information technology, as follows:
* * * * *
    (2) * * *
    (i) * * *
    (E) For CY 2015 and 2016, satisfied the required objectives and 
associated measures under Sec.  495.22(e) for meaningful use.
    (F) For CY 2017, the EP may satisfy either the objectives and 
measures specified in Sec.  495.22(e); or the objectives and measures 
specified in Sec.  495.24(d).
    (G) For CY 2018 and subsequent years, EPs, satisfied the required 
objectives and associated measures under Sec.  495.24(d) for meaningful 
use.
    (H) Cooperation with surveillance of certified EHR technology. 
Beginning on April 16, 2016, the EP must attest that he or she 
cooperated in good faith with the surveillance and ONC direct review of 
his or her health information technology certified under the ONC Health 
IT Certification Program, as authorized by 45 CFR part 170, subpart E, 
to the extent that such technology meets (or can be used to meet) the 
definition of CEHRT, including by permitting timely access to such 
technology and demonstrating its capabilities as implemented and used 
by the EP in the field.
    (I) Support for health information exchange and the prevention of 
information blocking. Beginning on April 16, 2016, the EP must attest 
that he or she--
    (1) Did not knowingly and willfully take action (such as to disable 
functionality) to limit or restrict the compatibility or 
interoperability of certified EHR technology.
    (2) Implemented technologies, standards, policies, practices, and 
agreements reasonably calculated to ensure, to the greatest extent 
practicable and permitted by law, that the certified EHR technology 
was, at all relevant times--
    (i) Connected in accordance with applicable law;
    (ii) Compliant with all standards applicable to the exchange of 
information, including the standards, implementation specifications, 
and certification criteria adopted at 45 CFR part 170;
    (iii) Implemented in a manner that allowed for timely access by 
patients to their electronic health information; and
    (iv) Implemented in a manner that allowed for the timely, secure, 
and trusted bi-directional exchange of structured electronic health 
information with other health care providers (as defined by 42 U.S.C. 
300jj(3)), including unaffiliated providers, and with disparate 
certified EHR technology and vendors.
    (3) Responded in good faith and in a timely manner to requests to 
retrieve or exchange electronic health information, including from 
patients, health care providers (as defined by 42 U.S.C. 300jj(3)), and 
other persons, regardless of the requestor's affiliation or technology 
vendor.
* * * * *
    (b) * * *
    (2) * * *
    (i) * * *
    (H) Cooperation with surveillance of certified EHR technology. 
Beginning on April 16, 2016, the eligible hospital or CAH must attest 
that it has cooperated in good faith with the surveillance and ONC 
direct review of its certified EHR technology certified under the ONC 
Health IT Certification Program, as authorized by 45 CFR part 170, 
subpart E, including by permitting timely access to such technology and 
demonstrating its capabilities as implemented and used by the eligible 
hospital or CAH in the field.
    (I) Support for health information exchange and the prevention of 
information blocking. Beginning on April 16, 2016, the eligible 
hospital or CAH must attest that it--
    (1) Did not knowingly and willfully take action (such as to disable 
functionality) to limit or restrict the compatibility or 
interoperability of certified EHR technology.
    (2) Implemented technologies, standards, policies, practices, and 
agreements reasonably calculated to ensure, to the greatest extent 
practicable and permitted by law, that the certified EHR technology 
was, at all relevant times--
    (i) Connected in accordance with applicable law;
    (ii) Compliant with all standards applicable to the exchange of 
information, including the standards, implementation specifications, 
and certification criteria adopted at 45 CFR part 170;
    (iii) Implemented in a manner that allowed for timely access by 
patients to their electronic health information; and
    (iv) Implemented in a manner that allowed for the timely, secure, 
and trusted bi-directional exchange of structured electronic health 
information with other health care providers (as defined by 42 U.S.C. 
300jj(3)), including unaffiliated providers, and with disparate 
certified EHR technology and vendors.
    (3) Responded in good faith and in a timely manner to requests to 
retrieve or exchange electronic health information, including from 
patients, health care providers (as defined by 42 U.S.C. 300jj(3)), and 
other persons, regardless of the requestor's affiliation or technology 
vendor.
* * * * *
0
7. Section 495.102 is amended by--
0
a. Revising paragraph (d)(1).
0
b. Revising paragraph (d)(2)(iv).
0
c. Revising paragraph (d)(3).
    The revisions read as follows:


Sec.  495.102  Incentive payments to EPs.

* * * * *
    (d) Payment adjustment effective in CY 2015 and subsequent years 
for nonqualifying EPs. (1) Subject to

[[Page 28398]]

paragraphs (d)(3) and (4) of this section, for CY 2015 through the end 
of CY 2018, for covered professional services furnished by an EP who is 
not hospital-based, and who is not a qualifying EP by virtue of not 
being a meaningful EHR user (for the EHR reporting period applicable to 
the payment adjustment year), the payment amount for such services is 
equal to the product of the applicable percent specified in paragraph 
(d)(2) of this section and the Medicare physician fee schedule amount 
for such services.
    (2) * * *
    (iv) For 2018, 97 percent, except as provided in paragraph (d)(3) 
of this section.
    (3) Decrease in applicable percent in certain circumstances. In CY 
2018, if the Secretary finds that the proportion of EPs who are 
meaningful EHR users is less than 75 percent, the applicable percent 
must be decreased by 1 percentage point for EPs from the applicable 
percent in the preceding year.
* * * * *
0
8. Section 495.316 is amended by revising paragraph (g)(2) and adding 
paragraph (g)(3) to read as follows:


Sec.  495.316  State monitoring and reporting regarding activities 
required to receive an incentive payment.

* * * * *
    (g) * * *
    (2) Subject to paragraph (h)(2) of this section, provider-level 
attestation data for each eligible hospital that attests to 
demonstrating meaningful use for each payment year beginning with 2013.
    (3) Subject to paragraph (h)(2) of this section, provider-level 
attestation data for each eligible EP that attests to demonstrating 
meaningful use for each payment year beginning with 2013 and ending 
after 2016.
* * * * *

    Dated: April 18, 2016.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
    Dated: April 25, 2016.
Sylvia M. Burwell,
Secretary, Department of Health and Human Services.

    Note: The following Appendix will not appear in the Code of 
Federal Regulations.


[[Page 28399]]



Appendix
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[FR Doc. 2016-10032 Filed 4-27-16; 4:15 pm]
BILLING CODE C