Value Care: CMS Value Modifier Programs Ends Not with a Bang but a Whimper

Thanks for nothing. While CMS likes to congratulate itself for using provider pay adjustments to "transform the healthcare delivery system," more often than not, the rhetoric fails to live up to the reality. Case in point: the Value Modifier, the pay-for-performance program started in 2015 that offers a Medicare reimbursement bump to clinicians, i.e., physicians, nurse practitioners, physician assistants, clinical nurse specialists, and certified registered nurse anesthetists for hitting specific patient care quality metrics. The size of the increase ranges (in 2018, the range was 6.6% to 19.9%) based on an actuarial formula.

The 2018 Adjustments
On Jan. 12, CMS announced the adjustments for 2018, the last year of the program. The results were pretty underwhelming. Thus of the over 1.1 million eligible clinicians:

  • Only 20,480, or 1.8%(!), earned the promised positive payment bump;
  • Nearly 300,000, or 25.8%, qualified for negative adjustments that in previous years would have earned them a pay cut but won’t result in pay cuts in 2018 due to rules changes; and
  • The "overwhelming majority," i.e., 744,556, or 64%, qualified for neutral pay adjustments.

Bottom line: In 2018, 98.2% of clinicians will get to Value Modifier adjustments. This year’s uninspired results are pretty consistent with the previous two years of the program, as illustrated by the Table below.

  2018 2017 2016 2015
Value Modifier
Payment Adjustment
Total Practices Total Clinicians Total Physicians
# % # % % % %
All upward payment adjustments (1.0x, 2.0x, 3.0x in 2018) 3,478 1.7% 20,481 1.8% 1.4% 0.9% 3.2%
Neutral payment adjustment due to performance 74,024 35.7% 746,556 64.8% 61.3% 65.3% 72.1%
Neutral payment adjustment due to holding harmless from performance 8,007 3.9% 87,841 7.6% 1.3% 3.8% NA
Downward adjustment due to performance NA NA NA NA 3.0% 2.2% 1.1%
Downward adjustment due to lack of quality reporting 121,642 58.7% 296,475 25.8% 33.0% 27.8% 23.6%
Total Value Modifier Practices & Clinicians 207,151 100% 1,151,353 100% 100% 100% 100%

Takeaway: Perhaps mercifully, 2018 is the final year of the Value Modifier program which is being phased out in favor of the new Merit-based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs). It remains to be seen whether the new models will have more impact than their predecessor.


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