Can virtual groups help independent practices?

Medical associations and experts have noted that performance reporting will be a burden on small practices under Medicare’s new Merit-based Incentive Payment System (MIPS), a value-based payment program that began on January 1.

To help small practices with this reporting next year, the government has promised to create “virtual groups”-electronically connected networks of independent physicians that can use the group’s health IT infrastructure to report performance data on their eligible clinicians. Each group will include between two and 10 eligible clinicians, according to the Centers for Medicare & Medicare Services (CMS).

Last fall’s final rule for the Medicare
Access and CHIP Reauthorization Act of 2015 (MACRA) created MIPS and authorized virtual groups, but details regarding the latter were scant. CMS officials say future rulemaking will explain it all. 

So we don’t yet know whether the groups will consist of physicians located in the same geographic area, where the funds will come from to build the groups’ technical infrastructure, or how they will help practices collect the requisite data.

Here’s what we do know about virtual groups and how physicians can use organizations outside their practice to report performance data.

Postponed Start  

CMS has decided not to implement virtual groups in 2017, which the agency regards as a “transition year” for physicians. 

In the executive summary of the MACRA final rule, CMS said it needed more information from stakeholders on how to structure and implement virtual groups. The agency also notes in the body of the rule that it has “identified significant barriers regarding the development of a technological infrastructure required for successful implementation.”

CMS has invited comments on minimum standards for members of virtual groups, how these networks could use their data for analytic purposes, the use of group identifiers and “requirements that could facilitate use of virtual groups to enhance health outcomes and goals such as coordination of care.”

The latter goal suggests that CMS has plans for virtual groups that extend beyond group reporting by independent practices. But before agency officials write rules, they want to make sure they understand all the ramifications of its proposal, says Billy Wynne, JD, who heads the health policy division of Thorn Run Partners, a Washington, D.C., lobbying firm.

“CMS has been burned by tech barriers in healthcare.gov, so they’re being extra cautious before they green-light this mechanism,” Wynne says. “But CMS is also concerned about the ability of small practices to succeed under MIPS. So they want to get virtual groups out there, but want to make sure they do it right.”

Interoperability barrier

Other observers question whether virtual groups will be able to offer practices the health IT infrastructure they need to report their data to CMS. 

A virtual group, they note, would have to aggregate and standardize quality data from many different electronic health records (EHRs)-unless all of the practices used the same EHR, which is unlikely.

Because of the lack of interoperability among EHRs, such standardization would require a considerable investment in data mapping software and technical staff.
Yet CMS has said nothing about government subsidies for virtual groups, nor has it announced how groups will submit data.

Without subsidies, health IT for these groups might be prohibitively expensive. Michael LaPenna, MBA, a healthcare consultant for Grand Rapids, Michigan-based The LaPenna Group, recalls putting together a plan for a small independent practice association (IPA) affiliated with a hospital. The cost for IT staff and software totaled $800,000 a year. 

Even with the hospital kicking in two-thirds of the cost, the doctors would have had to pay  $500-$600 each per year, LaPenna says.

Financial risk management

The Government Accountability Office (GAO) recently released a report to Congress on how financial risk management firms and other kinds of organizations might be able to help small and rural practices with MIPS and other value-based payment models. 

The report predicts that many small practices will be unable to make the transition to MIPS on their own because they lack the financial resources to invest in infrastructure. The report adds, however, that such practices could seek financing and technical expertise from outside partners.  Among these potential partners are larger physician groups, nonprofit groups, private companies, IPAs, hospitals and health systems.

“Non-partner” organizations that provide a set of services without sharing risk include technology vendors, Medicare quality improvement organizations and regional extension centers, the GAO says.

Having small practices partner with or hire these outside organizations to help them cope with value-based reimbursement is “aligned” with the virtual group concept, Wynne says.

Paul Keckley, Ph.D., a health policy expert and publisher of the health policy newsletter The Keckley Report, speculates that CMS is looking at more than just having these virtual groups report performance data. The agency also wants virtual groups to help small practices improve care quality and take on financial risk, he says.

Déjà vu all over again

In Keckley’s view, virtual groups are essentially the same as IPAs, which grew rapidly in the 1990s before fading out. 

Most IPAs failed because they weren’t able to win better insurance contracts for physicians, he recalls. IPAs also promised to help doctors retain their independence, but physicians found they had submit to medical management for the IPA to thrive in the marketplace.

Today, LaPenna notes, very few doctors have access to “a working, effective, functional IPA.” While the model has had success in California, he says, it took decades for independent doctors in that state to learn how to work together in IPAs that took financial risk.

Despite past failures, IPAs can succeed in today’s market if they’re properly structured and managed, argues John Franco, MD, medical director of the IPA of Nassau and Suffolk Counties on New York’s Long Island.

He regards his 800-member IPA, which is affiliated with another IPA of similar size in New York’s Westchester County, as a kind of virtual group. His IPA, he notes, will help its members both report to MIPS and improve their quality of care.

“If a doctor wants to be an independent providing healthcare, he or she has to be part of something,” he says. “To go it alone is a challenge. An IPA is the solution.”

ACO solution

Accountable care organizations (ACOs) also can help doctors report under MIPS. Partly for that reason, Jennifer Brull, MD, and her four colleagues in a primary care group in Plainville, Kansas, recently joined a physician-owned ACO, one of many formed by Aledade, a management and technical services company. 

The Kansas ACO includes about 45 doctors in 15 different practices, and Brull says she has “a large voice in how the ACO runs.”

Another reason why Brull’s practice participates is that the ACO provides strong health IT support. 

“I can’t imagine how the tech would work in a virtual group,” she says. “I know how challenging the tech is for us, and we have tremendous support from Aledade. I can’t imagine how it would be easier for a group of doctors who have no affiliation to report [to MIPS] together. That would be the biggest challenge.”

Reporting Alternatives

Physicians need not rely on virtual groups to cope with MIPS or value-based reimbursement. 

For example, some are having their EHR vendors report to CMS for them. Solo internist Edward Rippel, MD, of Hamden, Connecticut, says that his vendor configured his system so it could report his data “for a small fee.” 

Moreover, he gets full credit for clinical practice improvement activities because he’s a patient-centered medical home. So Rippel doesn’t need to join a virtual group to report to MIPS, he says. 

Doctors can also look to other methods of group reporting, such as qualified clinical data registries. Originally used for reporting to CMS’ Physician Quality Reporting System, most registries are operated either by specialty societies, specialty-specific or disease-oriented collaboratives, or quality improvement collaboratives. 

The fees to use these registries are generally only a few hundred dollars per doctor per year, and experts in these organizations can walk practices through the reporting process. The main drawback of data registries is that they usually require manual data entry, although some registries are more automated than others. (For more information, see bit.ly/QCDR-info.)

Participating in a registry formed by a specialty society, Wynne says, is a good alternative for physicians who don’t want to join a virtual group. “If you’re a small practice,” he says, “participating in a clinical registry is going to be your best bet.”