MIPS / MACRA
What is MACRA?
The Medicare Access and CHIP Reauthorization Act (MACRA), signed into law on April 16, 2015, overhauled the existing Medicare reimbursement system by eliminating the Sustainable Growth Rate (SGR) formula. In its place, MACRA introduced a pay-for-performance model that emphasizes quality of care, value, and accountability, shifting away from the traditional fee-for-service approach.
Quality Payment Program
MACRA consolidated three previous Medicare programs—the Physician Quality Reporting System (PQRS), the Value-Based Payment Modifier (VBM), and the Medicare Electronic Health Record (EHR) Incentive Program—into a single streamlined initiative known as the Quality Payment Program (QPP). The QPP offers two participation tracks for providers:
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Merit-based Incentive Payment System (MIPS): A performance-based system that adjusts payments based on quality, cost, improvement activities, and use of certified EHR technology.
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Advanced Alternative Payment Models (APMs): A path for providers who take on more risk through innovative care models, potentially earning greater rewards for high-quality, cost-efficient care.
Most providers will initially participate through MIPS.
What is MIPS?
Under the Merit-based Incentive Payment System (MIPS), clinicians are included if they qualify as an eligible clinician or eligible professional (EC/EP) and meet the Low-Volume Threshold (LVT). This threshold is determined by:
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The amount of allowed charges for covered professional services under the Medicare Physician Fee Schedule (PFS), and
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The number of Medicare Part B patients who receive these covered services.
Clinicians who fall below the LVT are generally excluded from MIPS participation, while those who meet or exceed it are required to report and are subject to performance-based payment adjustments.
The 4 scorable MIPS categories in 2021 are:
40% of Total Score Quality
25% of Total Score Promoting Interoperability
15% of Total Score Improvement Activities
20% of Total Score Cost
Who Qualifies as an EP?
- Physicians (including doctors of medicine, osteopathy, dental surgery, dental medicine, podiatric medicine, and optometry)
- Osteopathic practitioners
- Chiropractors
- Physician assistants
- Nurse practitioners
- Clinical nurse specialists
- Certified registered nurse anesthetists
- Physical therapists
- Occupational therapists
- Clinical psychologists
- Qualified speech-language pathologists
- Qualified audiologists
- Registered dietitians or nutrition professionals
Who is Eligible?
Providers must participate in MIPS if they bill over $90,000 annually, serve more than 200 Medicare Part B patients, and provide over 200 covered services under the Medicare Physician Fee Schedule.
Who is Exempted?
How MIPS will be Scored?
Clinicians have the option to participate in MIPS either individually or as part of a group for each TIN/NPI combination they bill under. For individual participation, CMS applies payment adjustments at the individual NPI under each TIN. For group participation, adjustments are made at the group or practice level based on the collective performance.
Under MIPS, eligible clinicians (ECs) receive an annual performance score based on four key categories: Quality, Cost, Promoting Interoperability, and Improvement Activities. These categories are combined to generate a MIPS composite score ranging from 0 to 100, which determines potential payment adjustments.
Quality
(45% of the final score)
This performance category, which replaces the former Physician Quality Reporting System (PQRS), focuses on the quality of care provided by clinicians. It is evaluated using performance measures developed by the Centers for Medicare & Medicaid Services (CMS) in collaboration with medical professionals and stakeholder organizations.
Promoting Interoperability
(25% of the final score)
This MIPS performance category replaces the Value-Based Payment Modifier (VBM) and focuses on the cost of care provided by clinicians. CMS calculates these costs using Medicare claims data, assessing both the total cost of care over a year and during specific episodes, such as hospital stays. Since 2018, the cost category has been factored into the clinician’s final MIPS score.
Improvement Activities
(15% of the final score)
This newer MIPS performance category evaluates improvements in care processes, patient engagement, and access to care. Clinicians can select activities that best align with their practice from categories such as enhancing care coordination, expanding access to services, and promoting shared decision-making between patients and providers.
Cost Measures
(15% of the final score)
We provide a full range of dental billing services, including thorough dental eligibility verifications and additional support designed to help you manage your practice more efficiently.
What determines my final MIPS Score (CPS)?
Final MIPS Score = Quality Weighted Score (40%) + PI Weighted Score (25%) + IA Weighted Score (15%) + Cost Weighted Score (15%) + Complex Patient Bonus (if applicable) + Small Practice Bonus (if applicable)
- A clinician’s or group’s MIPS score for a given performance year determines the payment adjustment applied to all Medicare Part B reimbursements.
- These adjustments are implemented two calendar years after the performance period. For example, performance in PY2021 impacts Medicare payments starting in 2023.
Why Report MIPS:
Under this system, physicians can earn financial incentives for delivering high-quality care, making improvements, and submitting accurate reports to CMS. Those who meet or exceed performance standards receive positive payment adjustments, while those who fail to report risk penalties and reduced compensation.
- 2019: +/- 4% of Medicare payments based on performance
- 2020: +/- 5% of Medicare payments based on performance
- 2021: +/- 7% of Medicare payments based on performance
- 2022: +/- 9% of Medicare payments based on performance
What is the minimum MIPS score I have to achieve to avoid a penalty in 2023?
For 2021 the performance threshold is set at 60 points (increased from 45 in 2020).