Time is ticking down to the Oct. 31 deadline for Academy members to sign up with the Academy’s IRIS™ Registry to use the Web-based portal option to report 2014 Physician Quality Reporting System measures. Physicians who don’t report for PQRS in 2014 face a 2 percent 2016 penalty. Practices of 10 or more eligible professionals (MDs and ODs) face an additional 2016 penalty for 2014 failure to participate in PQRS. The IRIS Registry reporting mechanism does not require an electronic health record system.

All physicians face:

• A 2 percent Physician Quality Reporting System 2016 penalty for not successfully reporting in 2014; and
• A 2 percent 2016 reduction for failing to adopt electronic health records in 2014 under the Medicare and Medicaid EHR incentive programs.

Large practices (10 or more MDs and ODs) also face:

• A 2 percent 2016 value-based modifier penalty for 2014 failure to participate in PQRS.

All three possible penalties are on top of the ongoing 2 percent sequestration reduction that went in effect in 2013.

Further Penalties Tied to 2015 Performance
Beginning in 2015, all ophthalmologists and other fee-for-service providers face future rewards or penalties based not only on quality of care, but cost of care — and the hardest hit could be specialties. 

The Affordable Care Act mandates that by 2017, the Centers for Medicare & Medicaid Services adjust provider payments based on cost and quality through the value-based modifier. This payment adjustment program, which is tied to PQRS, uses financial incentives to reward or penalize physicians for the quality and cost of care they provide.

All physicians face 2017 value-based modifier adjustments based on their 2015 performance.

The Academy does not support the VBM program and believes that the methodology used for calculating costs and evaluating physician performance is flawed and will have negative implications for specialists. 

The Academy has met with senior officials from CMS to explain its position against the VBM, and continues to work with the American Medical Association and other physician groups to stop or limit its implementation.

The Academy’s concern is that in 2017, physicians not successfully participating in the 2015 PQRS would receive:

• A 2 percent financial penalty under the PQRS program;
• A potential 4 percent penalty under the VBM program; and
• An additional 3 percent penalty under the meaningful use program if the physician has not also implemented an EHR system.

This totals 9 percent in potential penalties in 2017 — but the penalties may not stop there. There currently is no cap on the amount of penalties that could be imposed under the VBM.

The Academy believes that the VBM and its mounting provider penalties, coupled with the overwhelming changes in various physician reporting programs, could cause many unintended consequences for ophthalmology practices and their patients. Specifically though, the VBM puts specialists at an even greater disadvantage. Cost calculations unfairly penalize specialists due to the poor risk-adjustment methodology. The cost measure also includes Part B drugs in the calculation, but excludes Part D drugs.

However, some relief is possible if Congress passes the proposed bipartisan, bicameral SGR Repeal and Medicare Provider Payment Modernization Act of 2014, which gained broad support from the Academy and other physician groups earlier this year. The legislation would repeal the flawed sustainable growth rate formula that is used to calculate Medicare payments to physicians, and would also eliminate the VBM program.

The Academy’s Eye on Advocacy blog provides more information on the value-based modifier and new reports that current PQRS participants should evaluate.

Send questions or comments to pqrs@aao.org.