To Avoid Reduction in Medicare Payment in 2019,

You Must Act Quickly In 2017!


By: Donald R. Moy, Esq.

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) repealed the Medicare sustainable growth rate (SGR) and replaced it with a new program that is named the “Quality Payment Program” (QPP). Under the QPP, physicians and other clinicians must choose between two tracks: (1) the Merit-based Incentive Payment System (MIPS) or (2) Advanced Alternate Payment Models (Advanced APMs). Final Rules establishing the QPP were published in the Federal Register on November 4, 2016, and these rules became effective on January 1, 2017. Calendar Year 2017 has been designated as the first performance year.  There is generally a two year lag between an eligible clinician’s performance in reporting data required under MIPS and the payment consequences or payment year. This means a physician’s performance in submitting MIPS data for the 2017 performance year will determine whether the physician will receive a positive adjustment, negative adjustment or zero adjustment in Medicare Part B payment in the 2019 payment year. This also means that in order to avoid a negative payment adjustment in 2019, an eligible clinician must act quickly in 2017.  The Final Rule designates CY 2017 as a transitional year that is intended to give physicians and other clinicians a year to gain experience under the program. In CY 2017, clinicians will get to “choose their pace of participation”, with four options.

The four options in the CY 2017 performance year are: 

(1)  Physician can choose to report to MIPS for a full 90 day period, or “ideally” the full year, and maximize the eligible clinician’s chances to qualify for a positive adjustment.  In addition, MIPS eligible physicians who are “exceptional performers” in MIPS, as shown by the practice information that they submit are eligible for an additional positive adjustment for each year of the first 6 years of the program.

(2) Physicians can choose to report to MIPS for a period of time less than the full performance for 2017 but for the full 90 day period at a minimum and report more than one quality measure, more than one improvement activity, or more than the required measures in the advancing care information performance category in order to avoid a negative MIPS payment adjustment and possibly receive a positive MIPS payment adjustment. 

(3)  Physicians can choose to report one measure in the quality performance category; one activity in the improvement activities performance category; or report the required measures of the advancing care information category and avoid a negative payment adjustment in the 2019 payment year.

(4)  MIPS eligible physicians can participate in an Advanced APM, and if they receive a sufficient portion of their Medicare Part B payments or see a sufficient portion of their Medicare patients through the Advanced APM, they will qualify for a 5% bonus incentive payment in 2019. 

It is believed that a small percentage of physicians will qualify under option 4 in 2017, but the number of physicians who participate in Advanced APMs may increase over time.  Physicians have varying experience in participating in the MIPS program, but even physicians who have little experience or familiarity with the program should participate under option 3.

If a physician does nothing, the physician will receive a 4% negative adjustment in 2019.  Accordingly, rather than settle for a 4% negative adjustment in 2019, physicians should, at the very least, choose option 3 in CY for 2017.  Physicians should also familiarize themselves about the QPP in order to more fully participate in subsequent performance years.

Third Party Data Submission 

What if a physician or other clinician lacks ability or familiarity and is unable to submit MIPS data? The Final Rule permits third party intermediaries to submit MIPS data on behalf of a MIPS eligible clinician or group practice. A (i) qualified registry, (ii) qualified clinical data registry (QCDR) or (iii) a health IT vendor or other authorize party that obtains data from a MIPS eligible certified EHR technology (CEHRT) may submit data on behalf of the MIPS eligible clinician for the three performance categories: quality, improvement activities, and advancing care information.

The HHS website provides a list of qualified registries and QCDRs.  If a physician needs assistance and could benefit by reporting through a third party, it is recommended that the physician consider a qualified registry or QCDR. 

Quick facts

  Who are the clinicians covered under the QPP?
"Physicians" are covered clinicians. "Physicians” include not only doctors of medicine and doctors of osteopathy, but also includes dentists, optometrists, podiatrists and the chiropractors.  Clinicians also include physician assistants, nurse practitioners, clinical nurse specialists and certified registered nurse anesthetists.

Who is excluded from MIPS?

a) Newly enrolled in Medicare - A professional who first becomes a Medicare enrolled clinician within the PECOS during the performance year. These clinicians will not be treated as MIPS eligible clinicians until the subsequent year.

b) Low Volume - Individual clinicians and groups that meet either at the threshold of Medicare Part B allowed charges less than $30,000 a year or 100 or fewer Medicare Part B patients a year.

Identified as follows:

12 months data from September 1, 2015 to August 31, 2016, with a 60 days claims run out.

 Second assessment 12 months data from September 1, 2016 to August 31, 2017 with a 60 days claims run out.  MIPS eligible clinician who exceeded low volume threshold during the first determination assessment, may qualify under the second assessment.


c) Significantly participating in Advanced APMs – Physicians who participate in Advanced Alternative Payment Models (APMs) are exempt from MIPS reporting requirements.

·         Receive 25% of Medicare payments, or
·         See 20% of Medicare patients through the Advanced APM

(3)  What are the four MIPS performance categories?

Improvement Activities
Advancing Care Information

(4)  How are the Performance Categories weighted in the final score for the 2019 payment year?

Quality                                                60%
Cost                                                       0%
Improvement Activities                      15%
Advancing Care Information              25%

(5)  How are Performance Categories weighted in the final score in subsequent years?

                                                             2020                               2021 and beyond

Quality                                                50%                                         30%
Cost                                                     10%                                         30%
Improvement Activities                      15%                                         15%
Advancing Care Information              25%                                         25%

(6)  How is cost data reported?

There are no reporting requirements.  CMS will calculate cost measures using administrative claims data.

CMS will provide feedback on how clinician performed in this category in 2017, but it will not affect 2019 payments.

(7) What options does a group practice have in reporting MIPS data?

Groups have the option of reporting at the individual (TIN/NPI) level or group level (TIN)

 If group is assessed as a group all performance categories will be aggregated.

Depending on the composition of the group it may be advantageous for the group to report on the individual level, or vice versa.

Example – A group that may not be excluded from MIPS under the low volume exclusion when reporting as a group may find it advantageous to report at the individual level.

(8)  How many quality measures must be reported?

Clinician or group must report at least six measures including at least one outcome measure.  If an applicable outcome measure is not available, the MIPS eligible clinician or group must report one other high priority measure (appropriate use, patient safety, efficiency measures, patient experience, and care coordination).

If more measures than the six are reported, HHS will score all the measures and use only those with the highest performance result.

Quality Measures found at Table 8 of Appendix and Table E of Appendix, specialty specific measures.

(9)  What is the Improvement Activities Category?

These are activities that HHS has identified as improving clinical practice or care delivery; are found at Table H of Appendix.

Report no more than four medium-weighted activities, two high-weighted activities, or any combination thereof, for a total of 40 points.

High-weighted activity = 20 points

Medium-weighted = 10 points

(10) What is the Advancing Care Information category?

In order to earn a performance score for the Advancing Care Information category, a MIPS eligible clinician must use CEHRT.

In 2017, MIPS eligible clinicians may use EHR technology certified to the 2014 edition or the 2015 edition, or a combination of the two.

In 2018, MIPS eligible conditions must use 2015 edition.

(11)  Advancing Care Information Scoring

             Base Score +   Performance Score +   Bonus Score = Final Score

50%                     90%                       15% 

Earn 100% or more and receive the full 25 points performance category final score.

Bonus Score - clinicians must submit a numerator/denominator or Yes/No response for certain measures.  For any measure requiring a Yes/No statement only a Yes statement qualifies for credit under the base score.

e.g. Patient Access Measure

Denominator: The number of unique patients seen by the MIPS eligible clinician during the performance period.                                   

Numerator: The number of patients in the denominator (or patient representative) who are provided timely access to health information to view online, download and transmit to a third-party and to access using an application of their choice.

e.g.      Information Requiring Yes/No
Security Risk Analysis was performed.

Performance Score
. Builds upon the Base Score and is based on the performance rate of each measure where numerator/denominator was reported.
Each measure may earn up to 10% or 20%. The percentage score is based on the performance rate.  Higher performance rate = higher score.
Performance Period: Minimum of 90 consecutive days.
2017 - 7 measures
2018 and beyond - 9 measures available

Bonus Points

5% for reporting to one or more public health or clinical data registries the on the immunization reporting registry. 

10% for using CEHRT to report Improvement Activities.

  Payment AdjustmentsRevenue Neutral

2019                -4% - 0 - +4%

2020                -5% - 0 - +5%

2021                -7% - 0 - +7%

2022                -9% - 0 - +9%

But you can avoid -4% in 2019 by selecting option 3 in 2017.  If you do nothing in 2017 you will be subject to -4% in 2019.


(13)  What is an Advanced APM?

Advanced APM must meet certain criteria

·         Require participants to use CEHRT
·         Pay its participants based in part on quality measures similar to MIPS
·         Either require its participating Advanced APM entities to bear financial risk for monetary losses that are in excess of “nominal” or is a “Medical Home”

CEHRT – To be an Advanced APM, at least 50% of eligible clinicians must use CERHT.

Financial Risk – If actual expenditures exceed expected expenditures, one of the following must occur;

i. Withhold payments for services to the APM entity or to APM entity’s clinicians
ii. Reduce payment rates
iii. Require APM entity to owe payments to CMS

“Nominal” amount is met for 2017 and 2018 period if, under the terms of the APM, the total amount that the APM entity owes or must forego is (1) 8% of the average estimated total Medicare Parts A and B revenues for participating APM entities (the “revenue-based standard”), or (2) 3% of the expected expenditures for which the APM entity is responsible. (the “benchmark-based standard”).

(14)  What are some of the Advanced APMS?
  • Comprehensive End Stage Renal Disease Care Model (Two-sided Risk) 
  • Comprehensive Primary Care Plus (CPC +)
  • Shared Savings Program ACO Track 2
  • Shared Savings Program ACO Track 3
  •  Next generation ACO

The list of Advanced APMs is posted at

ACO Track 1 + may be Advanced APM in 2018.

(15)  What is a Qualifying APM Participant (QP)?

QP must participate in an Advanced APM and meet participation thresholds based on payment amount or patient count.

Payment Amount Threshold is based on the percentage of Medicare Part B payment received through an Advanced APM.

2019 and 2020: 25%
2021 and 2022: 50%
2023 and later: 75%

Patient Count Threshold is based on the percentage of Medicare patients treated through an Advanced APM

2019 and 2020: 20%
2021 and 2022: 35%
2023 and later: 50%

(16)  What are advantages of being a QP?

·         Excluded from MIPS reporting
·       Receive a 5% lump sum bonus
·        Will recieve a higher fee schedule update starting in 2026



      This content is not intended as, and does not constitute, legal or other professional advice.  This publication is distributed with the understanding that Kern Augustine P.C. is not engaged in rendering legal or other professional advice through this content.  This content should be used for informational purposes only.