Five Things You Need to Know About the Merit-Based Incentive Payment System (MIPS)

On April 16, 2015, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law. The legislation’s purpose was two-fold. It repealed the sustainable growth rate (SGR) and introduced a new quality reporting program called the Merit-Based Incentive Payments System (MIPS).

As we enter into 2016, MIPS will take on more importance as some of the requirements of the program start to take shape. Here are the five key things you need to know about the Merit-Based Incentive Payment System (MIPS) program:

#1 – What is the Merit-Based Incentive Payment (MIPS) program?

MIPS will measure Medicare Part B providers in four performance categories to derive a MIPS composite score which is based on a scale of 0-100. The score will determine a positive, negative or neutral payment adjustment which can greatly impact a provider's Medicare reimbursement each year.  

The performance categories are:

  • MU (25 points)
  • VBM quality based upon PQRS measures (up to 30 points)
  • VBM cost or resource use performance (30 points)
  • Clinical practice improvement (15 points)

#2 – When Does the MIPS Program Begin?

The MIPS program begins with the 2017 performance year and results in payment adjustments in 2019. CMS has indicated that the program criteria will be available in spring of 2016.

#3 – Who is Eligible?

For the first two years of MIPS, the following Part B providers are eligible: physicians, physician assistants, nurse practitioners, clinical nurse specialists, and nurse anesthetists.

In the third and succeeding years of the program, eligibility expands to physical or occupational therapists, speech-language pathologists, audiologists, nurse midwives, clinical social workers, clinical psychologists, and dietitians or nutrition professionals.

Three classes of Part B providers are exempt from MIPS:

  • Providers participating in an "alternative payment model" such as the Medicare Shared Savings Program
  • Providers not exceeding a low-patient-volume threshold
  • Providers who enroll in Medicare Part B for the first time during a performance year

#4 – How are Incentives Calculated?

The financial impacts of the MIPS scoring system can be very significant. As previously discussed, the composite score will determine if a provider receives a positive, negative or neutral payment adjustment.

  • Positive Adjustments
    Providers whose composite performance scores are above the threshold will receive positive payment adjustments. These adjustments can be up to 4% in 2019 and grow over time to a maximum of 9% in 2022 and beyond. If the number of physicians attaining high composite scores is low, these incentives can be increased by a factor of up to 3. If it is higher than those receiving lower scores, these incentives can be scaled down to ensure budget neutrality.
  • Zero Adjustments
    Providers whose composite performance score is at the threshold will not receive a MIPS payment adjustment.
  • Negative Adjustments
    Providers whose composite performance score falls between 0 and one-quarter of the threshold will receive the maximum possible negative payment adjustment for the year.Professionals with composite performance scores closer to the threshold will receive proportionally smaller negative payment adjustments.  Negative adjustments will be capped at 4% in 2019, 5% in 2020, 7% in 2021, and 9% in 2022 and beyond.
  • Exceptional Performance Bonus
    A special Additional Incentive Payment funded with $500 million per year is applied for the top 75% of physicians above the performance threshold, ensuring that even if all physicians meet the MIPS threshold, there will still be funds for positive updates.

#5 – What are Clinical Practice Improvement Activities?

Providers will be given credit for working to improve their practices. The list of activities include:

  • Expanded Practice Access
    • Same day appointment for urgent matters
    • After hours clinician advice
  • Population Management
    • Monitoring conditions and providing timely intervention
    • Participation in a clinical data registry
  • Care Coordination
    • Timely communication with patients and other providers
    • Remote monitoring and use of telehealth
  • Beneficiary Engagement
    • Use of care plans
    • Shared decision making
  • Patient Safety Practice Assessment
    • Use of clinical checklists
    • Maintenance of certifications
  • Alternative Payment Models

Providers in a practice certified as a patient-centered medical home (PCHM) or "comparable specialty practice" shall be given the maximum score of 15 for the practice improvement category.  Or, if the provider participates in an APM, then the minimum score will be 7.5 for this category.

Bonus – What Should I Do to Prepare?

Keep an eye on our blog and the CMS blog for future educational posts. Look for a proposed rule from CMS in the spring of 2016. We encourage all providers to review the proposal and provide comments. The final rule is targeted for release in early fall 2016.