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What You Need to Understand about the MIPS Reporting System

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The MIPS stands for merit-based incentive payment system. This is one of the two tracks in the quality payment program that moves the Medicare Part B providers to the performance-based payment system. The new system is designed to streamline physical quality reporting system, value-based payment modifier program and Medicare electronic health record incentive program. With the merit-based incentive payment system, focus is on delivering high-quality patient care. With the help of several tools, the physicians report crucial data to the CMS, get valuable feedback about their practice and show their eligibility for payment adjustments.

Medicare Part B providers that qualify for the MIPS eligible clinician are required to participate in the MIPS. Failure to do so will lead to negative 4% payment adjustment on their Medicare Part B reimbursement come 2019.


The best thing about the merit-based incentive payment system is that the eligible clinicians get the option of participating as part of a group or as individuals. As an individual, you will be required to report the MIPS data to the CMS under the NPI number which is tied to one TIN. If you are two or more clinicians with unique NPIs but you have reassigned your billing rights to one TIN, you get the option of participating in the MIPS as a group. In this case, the clinicians participating as a group will be assessed across all the four MIPS performance categories as a group.

The four categories of MIPS

The performance based payment system has four categories that offer clinicians the freedom of selecting activities as well as measures that are more meaningful to their practice. The MIPS composite performance score is created by combining the performance of eligible clinicians in the four categories. This is then used to create the Medicare Part B payment for the future. The four categories of the MIPS reporting system are as follows:

  • Quality

This category was designed to replace the PQRS (physician quality reporting system). Eligible clinicians must report their data to the CMS for quality measures that are related to their patients’ outcomes, patient safety, appropriate use of the medical resources, patient experience, efficiency as well as care coordination. This constitutes 60%. 

  • Advancing care information

This replaces the Medicare HER incentive program. It reflects how the clinicians are using HER technology with focus on objectives that are related to the interoperability and the information exchange. This makes up for 25%.

  • Improvement activities

This is designed to encourage the clinicians to participate in activities that will improve their practice in areas like patient safety, shared decision making, increasing access and coordinating care. This accounts for 15% of the final score.

  • Cost

This replaced the CMS value-based payment modifier program. It evaluates how effectively a clinician uses resources relating to resource utilization and is calculated using the Medicare claims.

It is important to note that the MIPS payment adjustments only reflect eligible clinicians’ performance 2 years prior. That means payment for the 2018 transition year will be applied in the Medicare Part B reimbursements in 2020.


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