A Simulation Study of the Medicare Access and Chip Reauthorization Act

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Project Summary New financing models are a fundamental component of current changes to primary care. On April 16th, 2015 the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law. Title I of MARCA repealed the sustainable growth rate formula (SGR), the system in which Medicare reimbursement fees have been determined since 1997. In the place of the SGR, Medicare will pay health care providers through one of two Quality Payment Programs: The Merit-based Incentive Payment System (MIPS) or the Advanced Alternative Payment Model (APMs) by 2019. Both of the Quality Payment Programs link provider payment to performance, which will force healthcare providers who are reimbursed by Medicare to address outcome-based metrics within their practices. Practices will need to determine how to best motivate their providers to achieve outcome measures provided by the Physician Quality Reporting System (PQRS), while maintaining high quality patient centered care. There are two underlying barriers with implementing a successful outcome-based payment program: (i) it is unclear how new monetary incentives interact with the fundamental drivers of provider behavior; and (ii) it is difficult to ascertain the appropriate outcomes to incentivize. Insights into these barriers will be valuable in informing primary care providers how to best adapt the changes in reimbursement. The focus of this study is on a.) how different financing models for primary care affect the delivery of high quality care; and b.) how different external supports, delivery or financing models of primary care improve patient and/or provider satisfaction. The significance of this study is triple-fold: First, we will provide a better understanding of the interaction between monetary incentives and behavior, which is a key component of implementing outcome- based payment; secondly, we will leverage the use health care simulations to isolate and test the impact of finance reform on provider behavior; and lastly, we will build and infrastructure to test the appropriate outcomes to incentivize is pivotal to improving quality of care through outcome-based payment. The results of this study will produce evidence needed to ensure healthcare policy promotes payment models designed to make healthcare affordable continue to increase patient safety and quality care and thereby, public health.