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What is MIPS and How it Affects My Practice?

What is MIPS and How it Affects My Practice?

What is MIPS?

On November 1, 2018, CMS released revisions to payment policies under the Medicare Part B physician fee schedule for the Quality Payment Program (QPP) for the calendar year 2019. In accordance with one of the most bipartisan and significant legislative changes to Medicare in a generation, the Medicare Access and CHIP Re-authorization Act of 2015 (MACRA) repeals the legacy Medicare Part B Sustainable Growth Rate (SGR) reimbursement formula and replaces it with the QPP, a new value-based reimbursement system impacting Part B payments to clinicians nationally. The QPP rule is updated at least once per year and consists of two major tracks:

  1. The Merit-based Incentive Payment System (MIPS)
  2. Alternative Payment Models (APMs)

For the 2019 performance year, CMS predicts that 800,000 Part B clinicians will be subject to MIPS. MIPS is effectively the “new default” for Part B where clinicians are excluded from MIPS only under certain conditions.

Under MIPS, clinicians are included if they are an eligible clinician type and meet the low volume threshold, which is based on allowed charges for covered professional services under the Medicare Physician Fee Schedule (PFS) and the number of Medicare Part B patients who are furnished covered professional services under the Medicare Physician Fee Schedule.

Who is subject to MIPS?

MIPS eligibility includes only those eligible clinicians in the categories below who bill for Medicare Part B (otherwise known as the Physician Fee Schedule) or Critical Access Hospital (CAH) Method II payments assigned to the CAH. The eligibility net includes these professionals: Physicians (MD/DO and DMD/DDS), Physician Assistants, Nurse Practitioners, Clinical Nurse Specialists, Certified Registered Nurse Anesthetists, Physical and Occupational Therapists, Speech-Language Pathologists, Audiologists, Clinical Psychologists, and Registered Dietitians or Nutrition Professionals.

Exclusions from MIPS

  • Clinicians in their first calendar year of Medicare Part B participation
  • “Low-volume exclusion”: in a 12-month period, clinicians or groups each (a) billing $90,000 or less in Medicare Part B allowed charges for services, (b) providing care for 200 or fewer Part B beneficiaries, or (c) delivering 200 or fewer covered services to Part B beneficiaries
  • Clinicians in entities sufficiently participating in an Advanced APM

How it going to affect my practice?

The Merit-based Incentive Payment System (MIPS) is one of the two payment tracks created under MACRA; the other is the Advanced Alternative Payment Model (AAPM) track. MIPS adjusts payment based on performance in four performance categories:

  • Quality – based on the Physician Quality Reporting System (PQRS) (45%)
  • Cost – based on the Value-based Payment Modifier (VBPM) (15%)
  • Promoting Interoperability (PI) – based on the Medicare EHR Incentive Program (Meaningful Use) (25%)
  • Improvement Activities – a new category (15%)
Performance Category 2019 2020 2021
Quality 45% 40%** 35%**
Cost 15% 20%** 25%**
Promoting Interoperability 25%* 25%* 25%*
Improvement Activities 15% 15% 15%

*If the Secretary of the U.S. Department of Health and Human Services (HHS) determines the proportion of eligible clinicians who are “meaningful users of electronic health records (EHRs)” is estimated at 75% or greater, the weight of the PI category may be reduced. The remaining performance categories will be increased by the corresponding number of percentage points. The lowest weight the PI category can carry is 15%.

**Anticipated category weights

The MIPS payment adjustment amount will be determined based on an eligible clinician or group’s MIPS Final Score, which can be a maximum of 100 points. In 2017, the payment adjustments and associated MIPS Final Scores will be as follows:

MIPS Final Score Payment Adjustment
≥ 70 points Positive adjustment
Eligible for the exceptional performance bonus, which means at least an additional 0.5%
4-69 points Positive adjustment
Not eligible for exceptional performance bonus
3 points Neutral payment adjustment
0 points Negative payment adjustment of -4%
0 points mean an eligible clinician did not participate

The exceptional performance bonus is an annual pool of $500,000,000 incentive dollars that are allocated to eligible clinicians who are part of the top tier of MIPS participants in a given performance year. Only MIPS participants (individual clinicians or groups) are eligible for the exceptional performance bonus.

PERFORMANCE YEAR MEDICARE PART B PAYMENT ADJUSTMENT YEAR MAXIMUM -% MIPS PENALTY MAXIMUM +% MIPS BASE INCENTIVE MAXIMUM +% MIPS EXCEPTIONAL PERFORMANCE BONUS
2017 2019 -4% +4%*X
(Actual 0.29%)
+10%*Y
(Actual 1.59% )
2018 2020 -5% +5%*X
(CMS predicts 0.30% )
+10%*Y
(CMS predicts 1.75% )
2019 2021 -7% +7%*X
(CMA predicts 1.11%)
+10%*Y
(CMS predicts 3.58%)
2020 2022 -9% +9%*X +10%*Y
2021 2023 -9% +9%*X +10%*Y
2022 2024 -9% +9%*X +10%*Y

Performance is measured through the data clinicians report in four areas – Quality, Improvement Activities, Promoting Interoperability (formerly Advancing Care Information), and Cost. We designed MIPS to update and consolidate previous programs, including: Medicare Electronic Health Records (EHR) Incentive Program for Eligible Clinicians, Physician Quality Reporting System (PQRS), and the Value-Based Payment Modifier (VBM).

(Source: Centers for Medicare and Medicaid Services. Merit-based Incentive Payment System webinar. November 29, 2016.)

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