What Exactly is MACRA & MIPS?

The majority of practices across the US reported confusion with MACRA and MIPS requirements. Similarly, these concerns are reflected in the reporting results of both 2018 and 2019 – with poor outcomes overall across the country.

With so much confusion and poor results overall, we’ve broken down everything you need to know about MACRA and MIPS so you can reach or exceed your audit requirements for 2020.

What is MIPS and MACRA

MACRA is an acronym for the Medicare Access and CHIP Reauthorization Act. It is a landmark legislation aimed at changing Medicare payments to physicians. However, this act directly affects healthcare providers attending to Medicare beneficiaries.

Changes to the bill include repealing the sustainable growth rate (SGR) formula, altering how Medicare payments are determined. The act also combines the existing quality reporting programs into one system system.

In short, MACRA aims at streamlining the Medicare payments process to favor a pay-for-performance system. The new system rewards a higher quality of care (instead of a volume threshold), value to patients, and accountability in care.

MIPS tries to improve the quality of the act by moving Medicare Part B providers to a performance-based payment system. They include (VM) Value-based payment modifier, (EHR) Medicare Electronic Health Record usage, and the Physician Quality Reporting System (PQRS).

MIPS improves the measures of Meaningful Use by combining them into one program. Physicians who prioritize patient satisfaction and clinic efficiency get rewarded with additional reimbursements, payment adjustments, and bonuses. Likewise, non-adherence to the MIPS criteria can result in penalties to the practice.



Is MACRA Important for Your Practice?

One year after the enactment of MACRA, 65% of physicians reported not knowing anything about the act. Only 8% reported having been familiar with the policy.

On its introduction in 2015, physicians praised the act, hoping to see a measurable improvement in payment procedures. However, most were unaware that the act replaced the SGR, which was used to determine the Medicare reimbursements every year prior.

MACRA has two mechanisms (called Quality Payment Programs qpp) aimed at improving reimbursement procedures. We’ll review both in detail.

  1. Merit-based Incentive Payment System (MIPS) and
  2. Alternative Payment Models (APMs)

MIPS affects the majority of physicians in the US – meaning a majority of practices should participate in MIPS. It dictates how physicians get penalized or incentivized through reimbursements depending on their performance metrics. The program gives scores to the physicians with weighted averages across the following performance categories;

  • Quality of Care – 50%
    • This includes outcome measures and patient experiences
  • Clinical Practice Improvement Activities – 15%
    • These include increasing patient access and engagement
  • Cost of delivery and resource use – 10%
    • How efficient the practice can be in delivering care

These are the performance metrics that will determine the physicians’ penalties and incentives in terms of reimbursements.

Some small practices may be excluded from MIPS. Exclusions cover practices with 200 or fewer Medicare Part B patients, and/or less than $90,000 in Medicare Part B charges.

Payment adjustments span +/- 7%, and are weighed against your composite performance score. Below are the broad impacts you can expect vs your score after a review.


A Score Of Impact to Compensation
30 or more Positive Payment Adjustment
30 No Impact to Payments
Between 7.51 and 29 Moderate Negative Payment Adjustment
Less than 7.5 Highest Negative Payment Adjustment


APMs: This program targets larger and more technologically advanced clinical practices. Such practices include those engaging in the next generation accountable care organization model. It Fewer than 4% of the physician population are affected by APMs – meaning you are likely to be focusing on MIPS for your practice.

APMs also include a subset called Advanced Alternative Payment Models – which allow certain practices to receive additional compensation for assuming more risk in delivering patient outcomes.

MACRA Comes With Good Intention; Does MIPS Mean Well?

About 80 percent of physicians reported positive views towards MACRA. However, their opinions differ on the mechanisms used to ensure that the system meets its objectives.

Leaders have raised concerns against MIPS. They have highlighted the possibility of unintended outcomes in future. According to them, MACRA may mean well, but MIPs may hinder the act transition to value-based care.

Prepare Your Practice for MACRA

MACRA intends to boost reimbursement standards across the USA. Unfortunately, as mentioned in the introduction – the first 2 performance periods (in 2018 and 2019) registered poor results overall.

For the third audit period (2020), physicians are urged to consider embracing the changes outlined in the act. To accelerate results across MACRA and MIPS, providers are encouraged to engage professional organizations for support.

The reality remains that MACRA is here to stay. Physicians need to evaluate and modify their practices to better align to the new act requirements. There are clear ways to achieve the requirements by following best practices and easy optimizations.

If you’re looking for help hitting MACRA & MIPS quality standards, give us a call and let one of our healthcare consultants assess your current systems.


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