Merit-Based Incentive Payment System (MIPS) Decoded!

Merit-Based Incentive Payment

Beginning in 2019, the Centers for Medicare & Medicaid Services (CMS) will be applying a positive, negative, or neutral payment adjustment, in a budget-neutral manner, to every Merit-based Incentive Payment System (MIPS) eligible clinician, which will be based on a composite performance score. MIPS measures providers on a scale from 0 to 100 on four performance based criteria:

  • Value-Based Payment Modifier (VBM) – Quality(30 Points)
  • Meaningful Use (25 Points)
  • Value-Based Payment Modifier – Resource Use(30 Points)
  • Clinical Practice Improvement(15 Points)

CMS will use separate rulemaking cycles to select measures for MIPS and to establish criteria for the performance categories. MIPS will build upon existing quality measure sets from the Value-based Payment Modifier, Physician Quality Reporting System (PQRS), and Medicare EHR Incentive Program for Eligible Professionals.

MIPS Timeline

  • Medicare Part B providers need to be prepared for the new value-based payment program by the start of the FY 2017.
  • Using the provider data from 2017, that is, the first performance year, significant Medicare reimbursements will be adjusted up or down in 2019, for the first time.
  • In 2019, the maximum adjustment to reimbursements will be (+/-) 4%,which will further increase to (+/-) 9% in 2022.
  • Following 2022, the program will continue reimbursing and penalizing at the rate of (+/-) 9%.
  • The rate will then be multiplied by Medicare’s scaling factor, which can be up to 3X the reimbursement increases, which will mean that if a provider receives a 9% increase in reimbursement based on a high MIPS score, he could receive an increase of 27%, theoretically. This scaling factor allows Medicare to remain budget neutral by distributing penalties, fairly, from low scoring providers to the high scoring providers.

Eligibility for MIPS

According to MIPS payment system, an Eligible Professional (EP) is:

For Years 1 and 2

  • Physicians
  • Physician Assistants
  • Clinical Nurse Specialists
  • Nurse Practitioners
  • Nurse Anesthetists

For Year 3 and beyond

  • Clinical Psychologists
  • Physical/Occupational Therapists
  • SLPs
  • Audiologists
  • Nurse Midwives
  • Clinical Social Workers
  • Dietitians/Nutrition Professionals

In addition to that, the providers participating in an Alternative Payment Model (APM), are also eligible to participate in MIPS. However, Patient Centered Medical Homes (PCMH) and Accountable Care Organizations (ACO) will not be reimbursed under MIPS.

MIPS Challenges

Lack of incentives

The providers taking part in MIPS or fee-for-service reimbursement models will not receive any bonuses or financial incentives, and will receive lower reimbursement rates than the providers taking part in alternative payments.

Aligning stakeholders

Quality measures under the Merit-Based Incentive Payment System like PQRS will need to be simplified, and quality data needs to be in user-friendly form to truly benefit beneficiaries. Complex documentation standards make it difficult to align beneficiaries among the payers and providers. There’s a lack of alignment between Medicare, Medicaid programs, and commercial payers in terms of quality measures. This has burdened the providers with a pressure to improve their performance.

How to Prepare for MIPS?

To prepare for MIPS, you are required to combine the processes in your organization based on collecting and processing of data for PQRS, VBM, and Meaningful Use. As MIPS draws close, you need to streamline the collection of the criteria required by those existing programs, which will benefit your organization.

To get insights about MACRA updates and their implications on your healthcare practice, register for the year’s biggest CMS MACRA events.

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