Changes Ahead for Medicare Physician Payment

Current implementation plans for the Medicare Access and CHIP Reauthorization Act

As of April 2015, the Medicare physician payment system that relied on the sustainable growth rate formula (SGR) became history. The Medicare Access and CHIP Reauthorization Act (MACRA, Public Law 114-10) immediately repealed the SGR and replaced it with a new framework for paying physicians who provide Medicare services. It’s not just new set of rules that physicians need to follow, but a fundamental shift in CMS’ expectations of how health care should be delivered. 


Top 3 Things To Know About MACRA Implementation

  1. Physicians who see fewer than 100 Medicare Part B patients OR have less than $30,000 in Medicare Part B allowable charges are not required to participate in MIPS.

  2. 2017 is a "transition year" for MIPS participation. Physicians who take one of three actions in 2017 can avoid payment penalties in 2019:
    • Test: Report only one measure in either the quality or practice improvement category, or all 5 required measures in the advancing care information category and avoid a negative adjustment.
    • Partial: Report more than one measure for a minimum 90 day reporting period and be eligible for a small positive payment adjustment.
    • Full: Report all required measures and activities in each category for a minimum 90 day reporting period and be eligible for a larger positive payment adjustment.
    • Physicians who choose to do nothing will get the maximum 4% penalty in 2019.

  3. The Resource Use category will be assigned a weight of 0% in 2017; cost of care will not be part of the final MIPS score in 2017.

Quality Payment Program

The MACRA legislation set these changes in motion. On October 14, 2016, CMS released a final rule outlining exactly how MACRA would be implemented in the first year.

"Quality Payment Program"

New name for the “unified framework” established by MACRA, which includes the MIPS and advanced APM pathways.

CMS has set up a comprehensive web site:


  • Performance period begins January 1, 2017 for payment adjustments beginning in 2019
  • Low volume threshold of fewer than 100 Medicare Part B patients OR less than $30,000 in claims - CMS will notify practices if they meet the low-volume threshold
  • Group or individual reporting option available for all components

  • Quality reporting requirements (60%):
    • 6 measures out of 200 available
    • Measures available for individual selection or selection by specialty to facilitate choice
    • On additional population health measure calculated by CMS based on claims data
    • Measures worth up to 10 points, based on benchmark comparison
    • Measure points averaged to determine category score
    • pie chartMust report on up to 50% of patients to receive credit on a measure
    • Bonus points available for choosing certain kinds of measures and reporting methods

  • Resource Use (0% in 2017 only): CMS will still calculate based on claims data and provide an informational report to physicians.

  • Advancing Care Information reporting requirements (25%):
    • Replaces Meaningful Use
    • Score determined by 50-point base score plus additional performance score of up to 50 points
    • Base score is “pass fail;” requires attestation or yes/no reporting on five measures
    • Performance score allows for partial credit

  • Clinical Practice Improvement Activities (15%):
    • Allows physicians to select from more than 90 activities in 8 categories
    • Practice needs to be engaged in activities for at least 90 days
    • Maximum 40 points for category, with “high” value activities worth 20 points and “medium” value activities worth 10 points
    • Full category credit received for participation in recognized patient-centered medical home
    • Partial category credit for practices participating in an APM
    • Lower thresholds for small, rural, and non-patient facing specialties


  • Performance period for determining eligible APM participation begins January 1, 2017 for 5% bonus in 2019 - CMS will notify physicians if they meet the requirements for being a qualifying participant in an advanced APM

  • Defines an "advanced" APM as:
    • 50% of APM participants must use EHR technology
    • Quality measures used by APM must be comparable to those used in MIPS
    • Minimum 8% of average estimated Medicare Part A and B revenues OR 3% of benchmark spending must be at risk
    • Lower risk thresholds for medical homes

  • Current CMS programs that qualify as an advanced APM:
    • Track 2 and Track 3 Medicare Shared Savings Program ACOs
    • Next Generation ACOs
    • Comprehensive ESRD Care Organizations

  • CMS is expanding options for existing APMs to qualify as "advanced"

QPP Accommodations

CMS attempted to promote flexibility when it developed the Quality Payment Program. The Program includes numerous accommodations for small and rural practices, non-patient facing specialties, and specialties that may have difficulty identifying applicable measures and activities in the MIPS categories. Examples include:

  • The ability to reweight MIPS performance categories if applicable measures are not available
  • Reduced reporting requirements in the quality and clinical practice improvement categories
  • Flexible scoring in the advancing care information category, which allows clinicians to select relevant measures
  • Availability of specialty measure sets to help practices identify potentially relevant quality measures
  • Designated funding for education and practice transformation

Preparing for MACRA Changes

Changes are definitely coming. ISMS recommends practices take steps now to help prepare for the final implementation, and the other changes that are likely to follow:

ISMS staff is willing to present to your group or work with your individual practice to help you learn more about MACRA and what you need to do to get ready.


For more information, please contact the ISMS Division of Health Policy Research and Advocacy 800-782-4767 ext. 1470 or

  1. Determine how much of your volume is attributable to Medicare Part B
    • Low volume thresholds could exempt you from MIPS participation
    • Small, rural and non-patient facing practices that exceed low volume thresholds are eligible for some MIPS accommodations

  2. Review your performance in PQRS, Meaningful Use, and the Value Based Modifier Programs
    • Some measures and objectives will carry over to MIPS
    • Access and review most recent Quality and Resource Use Reports and PQRS feedback reports
    • Understand performance and look for opportunities for improvement

  3. Consider participating in a qualified clinical data registry to streamline reporting and assist with MIPS performance scoring

  4. Evaluate your EHR capabilities, and engage with your EHR vendor to understand certification status and how the system edition affects reporting options

  5. Stay up to date with ISMS resources. We will provide updates regarding key developments on MACRA implementation. Contact us for hands on support and to learn about additional resources that may help ease the transition

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