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NPs to transition to merit-based payment system

Increased public support of patients’ rights is driving new state laws. Legal decisions about health issues and national legislation on healthcare funding could change the way care in the U.S. is accessed and paid for. To help keep readers informed, highlights some important healthcare policy issues for nurses to watch.

Say goodbye to sustainable growth rate formula

What’s happening now: In April, Congress passed and President Obama signed into law the Medicare Access and CHIP (Children’s Health Insurance Program) Reauthorization Act of 2015. Among other things, the act repeals the sustainable growth rate formula for calculating reimbursement for Medicare providers, including advanced practice nurses. The act also institutes a 0.5% payment increase for the next five years, then freezes rates through 2025, as Medicare transitions to a new method of paying providers based on the quality of care they provide.

The new payment formula, scheduled to begin in 2019, creates a Merit-Based Incentive Payment System intended to reward providers who deliver documented quality care, use resources efficiently, employ practices shown to improve outcomes and keep patients out of the ED. Providers who use alternative payment models such as accountable care organizations, bundled payment arrangements and medical homes, can opt out of the merit payment system and are eligible for 5% bonus payments.

In contrast, the old sustainable growth rate formula attempted to hold down costs by tying Medicare payment rates to domestic economic growth. When spending exceeded targets, as it almost always did, payments to providers were cut, resulting in outcry among physicians, hospital administrators and others. Congress regularly restored the cuts, but the process was confusing and expensive, and increased rather than limited Medicare spending.

How it affects nurses in their practice

By repealing the sustainable growth rate formula, the new law eliminated a looming 21% cut in provider reimbursement “that would have had great consequences for both Medicare recipients and providers such as nurse practitioners,” Ken Miller, PhD, RN, CFNP, FAAN, FAANP, president of the American Association of Nurse Practitioners, said in an email response to questions about the new law.

The new law also authorizes NPs to certify patient eligibility for durable medical equipment such as catheters and hospital beds. Previously, if an NP ordered certain types of equipment, the patient still needed a face-to-face visit with a physician who would certify the equipment was needed. Under the new law, NPs can see a patient, determine eligibility and order the equipment without intervention by a physician or any other provider, Miller said.

What to watch for in the future

Although it does not change a formula that pays NPs 85% of physician rates, the new Medicare payment formula moves away from traditional fee-for-service models, and allows NPs to participate in the merit-based incentive system that will start in 2019, Miller said, which means they will be eligible for financial incentives for providing quality care. It also will reward APNs for participating in successful alternative payment models and ensure NP-led medical homes are eligible to receive incentive payments for management of patients with chronic disease, he said.

“Instead of being added to a physician-based system, NPs will participate in value-based payment systems from their inception,” Miller said. “This means the same revisions in payment and quality requirements as for physicians, along the same time line. This should create a more equitable system of care, better access, more efficiency, higher quality and accountability by clinicians, including nurse practitioners providing care to patients.” The new payment system will apply to all nurse practitioners, whether they are employed by physicians or have their own practices, he said.

Other aspects of the Medicare Access and CHIP Reauthorization Act of 2015 include that it:

  • Extends the Children’s Health Insurance Program through September 2017
  • Provides funds for community healthcare centers and the National Health Service Corps
  • Cuts or limits Medicare payments to hospitals and post-acute care providers
  • Requires high-income beneficiaries to pay a greater portion of Medicare premiums starting in 2018

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By | 2015-07-01T16:58:20-04:00 June 22nd, 2015|Categories: National, Nursing specialties|1 Comment

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    smarty July 6, 2015 at 5:05 pm - Reply

    the ACA isn’t about quality of care, it is about rationing care and controlling costs, and it also decreases autonomy of all health care providers. It is adding on yet another layer of bureaucrats and taking away health care dollars from patients. And patients will see costs rise dramatically while quality and access falls rapidly.
    You will see nurse practitioner and MD’s disappearing as the incentive to go to school and then work for peanuts will destroy the professions.

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