The Department of Health & Human Services (HHS) has finalized a new payment system for Medicare clinicians that will continue transforming how the health care system pays for care. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) Quality Payment Program, which replaces the Sustainable Growth Rate, will equip clinicians with the tools to deliver patient-centered care, government officials say.

“It’s time to modernize the Medicare physician payment system to be more streamlined and effective at supporting high-quality patient care,” says Andy Slavitt, Acting Administrator of the Centers for Medicare & Medicaid Services (CMS).

“To be successful, we must put patients and clinicians at the center of the Quality Payment Program,” Slavitt adds. “A critical feature of the program will be implementing these changes at a pace and with options that clinicians choose. Today’s policies are designed to get all eligible clinicians to participate in the program, so they are set up for successful care delivery as the program matures.”

CMS’ ruling comes after a months-long listening tour, where officials entered discussions with nearly 100,000 individuals and heard nearly 4,000 public comments. A common theme in the input HHS received was the need for flexibility, simplicity, and support for small practices—something this final policy aims to provide, CMS officials say.

First, the new payment system creates two pathways, according to CMS. Such paths let clinicians pick the right pace for them to participate in the transition from a fee-for-service health care system to one that uses alternative payment models that reward quality of care over quantity of services. Clinicians will choose between two options:

  • The first path, which gives clinicians the opportunity to be paid more for better patient care, reduces existing requirements. In the first year, it also provides a flexible performance period, so that those who are ready can dive in immediately; those who need more time, however, can prepare for participation later in the year.
  • The second path helps clinicians go further by participating in organizations that get paid primarily for keeping people healthy. For example, they could be part of an Accountable Care Organization, where clinicians come together to coordinate high-quality care for the patients they serve. When they get better health results and reduce costs for the care of their patients, the clinicians receive a portion of the savings.

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