Most of the healthcare professionals by now are aware of the recent change made in the healthcare industry at the start of 2019: the switch of Physician Quality Reporting System or PQRS with Merit-Based Incentive Payment System or MIPS.  Perhaps, you too, know about the change but haven’t come to an understanding on how this will disrupt your practice. So, if that stands to be the case, then here’s everything you need to know about MIPS, its benefits over the previous systems, its exclusions, why it is necessary to have a payment reimbursement system, and what medical billing companies need to know about it.

What is MIPS?

Law has made it obligatory for CMS to have a quality payment incentive program, better referred to as the Quality Payment Program, which has two ways enlisted to reward value and service; MIPS and APMS.

MIPS, the acronym for Merit-Based Incentive Payment System is in this day and age, the biggest value-based care reimbursement system that basically is the amalgamation of three old Medicare systems.  MIPS is aimed to be a major contributor in turning the healthcare sector from fee-for-service to pay-for-value. Practitioners can be included in MIPS if they fall in the eligible practitioner type category.

The performance is figured out by analyzing typically four areas which are reported by the doctor himself in multiple reports. The four areas are quality, improvement activities, promoting interoperability (formerly advancing care information), and cost. These categories enable practitioners to stay updated on their annual performance and can help them figure out the areas that need improvement.

How does it work?

As discussed above, there are four categories that help establish the performance of a clinic. The categories are further elaborated below:

  1. Quality:

This point defines the kind of quality of service you provide. The quality is determined by the measures defined by CMS and stakeholders, if any. Out of the pool of measures, you choose six which are most apt for your practice.

  • Promoting Interoperability (PI)

CMS has renamed Advance Care Information performance to Promoting Interoperability to shed light on factors that often go unnoticed such as patient engagement. To increase patient engagement, transmit healthcare information swiftly and for doctors to stay connected to patients, healthcare practitioners can use multiple tools such as patient portals, EMRs or EHRs.

  • Improvement activities

In contrast to the previous categories, this is a relatively new category which has been introduced to measure how a practice improves its care process, encourages patient engagement, and provides patients easy access to the care they are receiving.

  • Cost

The cost that a clinician provides his services for will be calculated by CMS against the Medicare claims you make. MIPS utilizes the cost measure to assess the entire year’s cost of services availed or the total cost of the hospital stay. Since this category has replaced VBM not too long ago, it has begun been adding to a clinician’s MIPS score since the beginning of 2018. 

How is a clinician’s MIPS score established?

A clinician is rated out of 100 for his MIPS score yearly and the score is established by the four qualities we discussed earlier on. We have given below weights for the 2019 performance year, and associated 2021 payment adjustment year:

Quality (45% weight, or 45 MIPS points maximum).

Cost (15% weight, or 15 MIPS points maximum).

Promoting Interoperability (PI) (25% weight, or 25 MIPS points maximum).

Improvement Activities (IA) (15% weight, or 15 MIPS points maximum).

Complex Patient Bonus (5 MIPS points maximum).

In case, the total points received by the practitioner exceed 100, a point cap will be enforced. If certain conditions are met, a practitioner can be excluded from the performance category. If that happens, then the given points from that respective category is allocated to either one or more than one of the other given categories. Keep in mind, that re-evaluation of categories takes place in the presence of the following conditions.

The percentage adjustment allotted to each Medicare Part B service payment to the practitioner in the payment adjustment year is established by the MIPS score received by a practitioner for a particular performance year

 The payment adjustment year is the calendar year that succeeds the performance year. Succeeding 7 months of the end of the performance year, CMS issues a MIPS feedback report to each practitioner or his group that comprises of the official MIPS score determined for that performance year.

Benefits of using MIPS:

MIPS has substantial benefits which are quite prominent to all the practitioners that have adopted it. Let’s take a look at the most important ones:

  1. Stronger standards and pull for alternative payment models

In a research conducted by the New England Journal of Medicine, the recent practices introduced by MACRA are encouraging practitioners to take part in alternative payment models. Furthermore, CMS is going so far as to enhance bundled payments and enable its use in joint replacement surgeries. To be brief, MIPS and Alternative Payment Models use much more rigid standards in order to ensure that practitioners maintain quality standards in order to improve the quality of the care that is provided to the patients.

  • MIPS advances healthcare reform

The American College of Cardiology declared that the new payment reimbursement program, MIPS will be an amalgamation of three other preexisting programs – Physician Quality Reporting System, Meaningful Use, and the Value-based Payment Modifier. These preexisting programs were pretty good on their own, and now their extension; MIPS is considered to take them a step further in functionality. In addition to being an amalgamation of the previous programs, there is an additional feature that the MIPS reimbursement program has which is called the Clinical Practice Improvement category, like discussed above.

The Clinical Practice Improvement category aims to reward practitioners that make it their business to implement strategies in order to better provide for their patients, increase their satisfaction along with their engagement.

  • Focus on value-based care cuts costs

The Commonwealth Fund highlights how repealing the SGR policy will possibly bring practitioners to go for different payment models and value-based care while avoiding fee-for-service payment methods in the past.

With the core focal point being value-based care, practitioners will tend to reduce unnecessary expenses and undue procedures which require wasteful spending as the focus will be more on quality rather than quantity.

“To accelerate the move from volume-based to value-based payment, a merit-based incentive payment system (MIPS) will be established beginning in 2019,” The Commonwealth Fund reports. “The MIPS will replace three previous incentive programs with a combined value-based payment program that assesses the performance of each eligible provider based on quality, resource use, clinical practice improvement activities, and meaningful use of certified electronic health record technology.”

 What are the financial and reputational impacts of MIPS?

Overview of Financial Impacts

MACRA states two categories of financial effects for Medicare Part B practitioners utilizing MIPS:

  • A negligible, yearly inflationary adjustment to the Part B fee schedule.
  • MIPS value-based payment adjustments (incentives or penalties) dependent upon the MIPS 100-point final score

The Medicare Part B inflationary adjustment is a yearly +0.5% raise for the payment years 2016 to 2019, which is the initial payment year for MIPS linked with the initial performance year (2017). The inflationary adjustment from 2020 to 2025 is none. Additionally, a subsequent yearly inflationary adjustment of +0.25% applies to the payment year 2026 and thereafter.

Who is subject to MIPS?

MIPS is subject to only certain practitioners in the categories enlisted below who file for either Medicare Part B (which is also commonly referred to as the Physician Fee Schedule), or bill Critical Access Hospital (CAH) method II payments allotted to CAH.

The eligibility is further elaborated for the initial couple of years as follows:

  • 2017 and 2018 performance years: physicians (MD/DO and DMD/DDS), physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists
  • Additions for 2019 performance year: stretches to also include physical and occupational therapists, speech-language pathologists, audiologists, clinical psychologists, and registered dietitians or nutrition professionals
  • Applicable payments for MIPS adjustments: For performance year 2019, Part B payments for services are made eligible for MIPS payment adjustments (excludes payments for items, such as Part B drugs).
  • Excluded Payments:
  • Medicare Part A
  • Medicare Advantage Part C
  • Medicare Part D
  • CAH Method I facility payments
  • Federally qualified health center (FQHC), rural health clinic (RHC), ambulatory surgical center (ASC), home health agency (HHA), hospice, or hospital outpatient department (HOPD) facility payments filed for billing based on the facility’s all-inclusive payment methodology or prospective payment system methodology.

Is there anyone who gets excluded from MIPS?

There are in total three exceptions for MIPS. These exceptions are given below:

  • Practitioners in their first calendar year of running the practice are omitted from MIPS.
  • Practitioners in clinics that are a participating in Advanced APM are also essentially omitted from MIPS. 
  • “Low-volume exclusion”: in a 1-year timeline, practitioners or groups each (a) billing $90,000 or below in Medicare Part B allowed charges for services, (b) giving care for 200 or lower number of patients Part B beneficiaries, or (c) delivering 200 or lesser covered services to Part B beneficiaries.

Opt-in to MIPS

The recent reform enables practitioners and groups of practitioners to the low-volume exclusion to still be a part of MIPS and be rewarded with a payment adjustment. Assuming that at least one or two of the low-volume conditions (a), (b) or (c) is NOT met, then the practitioner can find himself eligible to opt in to MIPS.

MIPS APM Clinicians

There are a few practitioners that have opted for APM and are also eligible for MIPS. For instance, practitioners that are part of the Advanced APM and are deemed as not “sufficiently participating” are also subject to MIPS. In certain cases, though, if certain criteria of the APM design is met deeming the APM as a “MIPS APM”, in that case an entity can also be subject to a special version of MIPS.

To elucidate the MIPS APM, the Medical Shared Savings Program (MSSP) is a great example, according to which practitioners that don’t assume apt downside financial risk are additionally subject to MIPS scoring and reporting demands.

How does a practice continuously succeed on the MIPS path?

Perseverance and grit on the part of a clinician towards the practice’s sustainable growth and performance improvement is a vital step towards its success in MIPS and to propel the practice in the way of providing value-based care. As the practice grows, its financial stakes grow as well and with a surge in the financial stakes, the MIPS program gets more daunting and the rating, more public. Therefore, it is essential for the healthcare company to have apt scorecards by having a control on the quality and performance factors, which is done on the basis of accurate data to manage key factors.

Boosting quality and optimizing costs in the healthcare sector requires a multi-year MIPS success plan that encompasses of key pointers and decisions such as ones given below: 

  • Developing an understanding of where your practice lies currently with MIPS and how alterations in 2019 will affect your scores, months succeeding the 2018 MIPS feedback report (released by CMS in mid-2019).
  • Making valuable staff in the organization well-informed about the development of MIPS in the upcoming 2 years and the resource reforms needed to position the practice for success.
  • Handling MIPS PI category performance to make sure that the clinicians are positioned for the required measures that are now available.
  • Educating your staff about how the MIPS program is related to your other, previous VBC or quality improvement measure to become more efficient in managing and improving performance and give a boost to the financial health of the practice.
  • Taking decisions about MIPS submissions that are well-educated and will only land you on the right side of the market, to give your scores and your financial health a boost.
  • Solidifying a plan which ensures that the company personnel goes through a performance improvement effort regularly catalyzed by MIPS and can be moved on to other value-based programs.
  • Establishing a quarterly QPP roadmap that comprised of your involvement in MIPS and APMs and that is related to your practice’s goals.

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