An Advanced Alternative Payment Model (APM) is a new concept introduced through the Quality Payment Program (QPP), created by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). An Advanced APM requires eligible clinicians to take on a higher level of financial risk for patient outcomes than participation in the traditional track, the Merit-Based Incentive Payment System (MIPS). In return, Advanced APMs provide the opportunity to earn greater rewards.

Criteria

For an APM to be considered an Advanced APM, it must meet all three of the following criteria:

  • CEHRT requirement: Use certified electronic health record technology
  • Quality measure requirement: Base payments on quality measures comparable to those used in MIPS (Quality performance category) AND
  • Financial risk requirement: Must either be a Medical Home Model expanded under the Center for Medicare and Medicaid Innovation OR requires participants to bear a more than nominal amount of financial risk in terms of total Medicare expenditures or participating organizations’ Medicare revenue (*note: revenue may be significantly lower for small practices)

As an eligible clinician, an individual or his/her organization can submit proposals of other models to be considered as Advanced APMs provided they meet the criteria above. These proposals should be submitted to the Physician-Focused Payment Technical Advisory Committee to review and assess.

Approved Models

The following models are considered Advanced APMs for 2017:

The Medicare Shared Saving Program – Track 2, Medicare Shared Savings Program – Track 3 and Next Generation ACO Model provide opportunities for the cardiovascular care team.

Rewards

There are three types of rewards that can be earned through participating in Advanced APMs:

  • A 5 percent lump sum incentive bonus based on Medicare Part B payment (starting in 2019)
  • A significantly higher Medicare Physician Fee Schedule update than would be received through participating in MIPS (starting in 2026)
  • Advanced APM model-specific rewards

It is important to understand that participation in the program is insufficient to qualify for earning the rewards. Eligible clinicians must see a sufficient number of Medicare patients or receive a sufficient amount of revenue through an Advanced APM. This is because Advanced APMs are designed to give the greatest rewards for significant or substantial participation in Advanced APM(s).

Qualifying

In general, qualifying APM Participant or “QP” status is determined at the Advanced APM entity level rather than at the level of the individual eligible clinician with rare exceptions. Clinicians under the Advanced APM entity can either be designated a full “QP” or a “Partial QP.” There will be three times a year the Advanced APM entity can apply for QP or Partial QP status. Once determined, status does not change for that performance year. The Advanced APM entity must reapply for QP or Partial QP status each year.

QP

If the APM entity (such as an ACO or physician group practice) meets the specified thresholds for “Qualifying APM Participant” or “QP” status, then all eligible clinicians belonging to the Advanced APM entity become “Qualifying APM Participants” or “QPs.” QPs are excluded from MIPS reporting requirements and payment adjustments. Each QP will earn:

  • A 5 percent lump sum incentive bonus based on Medicare Part B payment (starting in 2019)
  • A 0.75 percent Medicare Physician Fee Schedule update (starting in 2026) AND
  • Advanced APM Model Specific benefits

Partial QP

If the Advanced APM entity (such as an ACO or physician group practice) does not meet the specified thresholds for full QP status, it may qualify for partial QP status. If the Advanced APM Entity qualifies for partial QP status, all eligible clinicians belonging to the Advanced APM entity will be considered partial QPs. Partial QPs will not earn the 5 percent lump bonus. Unlike, QPs, which are automatically excluded from MIPS, partial QPs may participate in MIPS. The Advanced APM entity will make the decision to either stay out of MIPS or enter MIPS.

  • A .25 percent Physician Fee Schedule update starting in 2026 AND
  • Advanced APM model-specific benefits

Objectives and Measures

Each Advanced APM has its own model-specific measures and reporting requirements. Note the following:

  • Medicare Shared Savings Program participants report at the group Tax Identification Number level
  • Bundled Payment Program participants report at the National Provider Identifier level

Scoring

QPs

Scoring is specific to the Advanced APM model(s) eligible clinicians are participating in.  MIPS reporting requirements and payment adjustments do not apply.

Partial QP

If eligible clinicians participating in the Advanced APM do not meet the QP thresholds, then the Advanced APM entity (such as an ACO) that eligible clinicians belong to will decide whether or not to be scored under MIPS.

If a QP participates under MIPS, his/her score may be weighted differently than the standard MIPS scoring.

Quick Tips to Prepare for Advanced APM Participation

  • Find out if the Advanced APM entity (such as a physician group practice or hospital) you belong to already participates in one or more APMs. Search for your facility using this tool.
  • Determine if the APM your organization participates in is considered an Advanced APM
  • Find out who is in charge of your practice’s or hospital’s APM and ask if you meet the requirements to become  a QP (specifically whether your Advanced APM Entity believes it is possible to meet either the patient count or payment amount thresholds).

Additional Resources

As of 12/19/2016