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Changes to MIPS in New Budget Deal

February 13, 2018

Late last week, the U.S. Congress passed the Bipartisan Budget Act of 2018 that ended a brief federal government shutdown. Included in the legislation are modifications to the Merit-Based Incentive Payment System (MIPS) that will affect physician payments.

MIPS is a payment system introduced as part of the Centers for Medicare & Medicaid Services’ (CMS) Quality Payment Program (QPP) required by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The QPP, which is comprised of two paths, MIPS and Alternative Payment Models (APM), is intended to help transition clinicians from Medicare payment based on volume to payments based on value.

The newly signed legislation (P.L. 115-123) implements the following changes to MIPS:

  • Allows CMS flexibility in applying a weight less than 30 percent in the MIPS cost category score for three additional years
  • Reverses the decision to include Medicare Part B drug costs in the determination of MIPS participation and scores recently finalized in the 2018 MACRA implementation rule
  • Creates flexibilities for CMS to institute a gradual and incremental transition to the performance thresholds for an additional three years

During October, the Medicare Payment Advisory Commission (MedPAC), after analyzing MIPS, recommended an immediate repeal and replacement of the payment system, highlighting the program’s flaws.

HAP has provided input to CMS regarding the implementation of the new physician payment system established through MACRA, and has called for as much flexibility as possible to ensure a smooth transition.   

Please contact Kate Slatt, HAP’s senior director, health care finance policy, with any questions.

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