How Do You Become an Advanced APM?
To receive incentivized CMS payments under MACRA, APMs
must meet certain criteria that define them as “Advanced”
APMs. An Advanced APM must meet the following criteria:
1. Participants must use certified EHR technology.
Advanced APMs must require at least 50%, then 75% (after
the first year) of participating/eligible clinicians to document and communicate clinical care through the EHR.
2. Participants must base payments on quality (similar to MIPS
quality performance category).
Advanced APMs must base payment on quality measures.
No minimum domain measurements are required, except
for one outcome measure that is evidenced-based, reliable and valid.
3. Participants must bear more than nominal financial risk
OR be a medical home model.
An Advanced APM must meet two standards: ( 1) bear
risk for monetary losses, and ( 2) the risk must be of a
certain magnitude. As defined by the proposed CMS
rule, the amount of risk must be at least 4% of expected
expenditures, marginal risk >30% and minimum loss ratio
of no more than 4%. The mechanism by which practices
will bear risk include reduction of payments to APMs,
withholds of payments or direct payments from the APM
What is a Medical Home?
Medical homes are APMs focused on primary care health care
delivery. They must involve primary care physician practices
or multispecialty practices that offer primary care services.
Patients must be “empaneled” to primary care physicians.
Medical homes must also meet select criteria such as: coordination of preventive care, adequate patient access, shared
decision-making, risk-stratified care management, etc. The
financial structures by which medical homes most bear risk is
similar to other APMs, with a few notable exceptions, such as a
provision for payments (otherwise guaranteed) to be withheld.
Becoming a Qualified Participant in an Advanced APM
Participating in an Advanced APM alone does not automatically qualify clinicians for the financial incentives of MACRA
and the MIPS exclusions. Additional steps are required to
prove eligibility. Essentially, each practice must prove that a
certain percentage of patient/payments must occur through
the APM. Through a complex formula, a “threshold score” is
calculated to assess either the percentage of Medicare Part
B payments or patients in the advanced APM. A threshold
percentage cut-off has been established by CMS, but escalates
before stabilizing in 2023. Starting in 2021, some arrangements with non-Medicare payers can count toward becoming
a qualified participant (QP). In addition, QPs will get a higher
fee schedule update each year (0.75% vs 0.25%), compared
with baseline providers.
Those eligible can then become QPs and will receive a lump
sum 5% bonus on their fee schedules and will also be excluded
from MIPS. Performance bonuses will be based on the previous year, eg, 2019 bonuses will be based on 2018 services.
Bundled payments involve delivery of a single payment for
all health care services over an established episode of care.
With the passage of the ACA and national concerns over rising health care costs, bundled payments have emerged as
a possible solution. They work to financially incentivize all
stakeholders along the care continuum to increase quality and
reduce costs. In general, most bundles require participants
to bear some financial risk. Within spine care, bundled payments remain in their infancy. The early results of voluntary
government APM demonstration projects such as the BPCI,
have been disappointing in spinal surgery. Within the private
sector, many small but heterogeneous arrangements have
been ongoing. In spite of the potential advantages, substantial
infrastructure and data management system establishment
may be required. Given the goal of CMS to link health care
payments to value, institutions considering bundle payment participation should understand the MACRA APM
1. Huang J. Bundled payment and enhanced recovery after surgery.
J Med Pract Manage. 2015; 30( 5):349-53.
2. Mechanic RE, Altman SH. Payment reform options: episode
payment is a good place to start. Health Aff (Millwood).
2009.28( 2): w262-71.
3. Centers for Medicare Medicaid Services. NHE Fact Sheet 20116.
4. Birkmeyer JD, Gust C, Baser O, Dimick JB, Sutherland JM, Skinner
JS. Medicare payments for common inpatient procedures:
implications for episode-based payment bundling. Health Serv
Res. 2010. 45( 6 Pt 1):1783-95, 2010.
5. Ugiliweneza B, Kong M, Nosova K, Huang KT, Babu R, Lad SP,
Boakye M. Spinal surgery: variations in health care costs and
implications for episode-based bundled payments. Spine. 2014;
6. Centers for Medicare Medicaid Services. Bundled Payments for
Care Improvement (BPCI): General Information. 2017. Available
Collaborative Spine Research. I: Impact of a bundled payment
system on resource utilization during spine surgery. Int J Spine
Surg. 2016;10: 19.
8. The Lewin Group. CMS Bundled Payments for Care Improvement
Initiative Models 2-4: Year 2 Evaluation & Monitoring Annual
Report. August 2016. Available at: https://innovation.cms.gov/
9. Kivlahan C, Orlowski JM, Pearce J, Walradt J, Baker M, Kirch DG.
Taking risk: early results from teaching hospitals’ participation in the
Center for Medicare and Medicaid Innovation Bundled Payments
for Care Improvement Initiative. Acad Med. 2016;91( 7): 936-42.
10. Odum SM, VanDoren BA, Spector LR. Is there value in
retrospective 90-day bundle payment models for cervical spine