High Rates Of Partial Participation In The First Year Of The Merit-Based Incentive Payment System

Abstract

There has been widespread concern over the design of the Merit-based Incentive Payment System (MIPS) since its authorization with the Medicare Access and CHIP Reauthorization Act of 2015. Using detailed performance data from 2017, the first implementation year of MIPS, we found that although 90 percent of participating clinicians reported performance equal to or better than the low performance threshold of 3 out of 100 (a calculated composite score), almost half of clinicians did not participate in at least one of the three program categories (quality, advancing care information, and improvement activities). The decision to participate in each category explained 86 percent of the total variance in clinicians' overall score, whereas actual performance explained just 14 percent, as a result of the ease of achieving high scores within each category. Still, 74 percent of clinicians who only partially participated in the program received positive payment adjustments. These findings underline concerns that MIPS's design may have been too flexible to effectively incentivize clinicians to make incremental progress across all targeted aspects of the program. In turn, this is likely to lead to resistance when payment penalties become more severe in 2022, as required by the MIPS authorizing legislation.

Keywords: Financial incentives; Health policy; MIPS; Medicaid services; Medicare; Payment; Payment models; Performance data; Physician payment; Physician reporting; Quality improvement; Quality measurement; Quality of care; Quality payment program.

Exhibit 1. Distribution of MIPS composite scores & Payment Adjustments

Source: Authors’ analysis of 2017 MIPS performance data from CMS Physician Compare database. Notes: In the first year of MIPS, clinicians reporting below the performance threshold of 3 received negative payment adjustments to Medicare Part B reimbursements. Those reporting a score of exactly 3 received a neutral adjustment, while those between 3 and 70 received positive adjustments. Any provider scoring over 70 was eligible for a share of a $500 million “exceptional performance” bonus payment adjustment. In 2017, the maximum positive payment adjustment a clinician could obtain was 1.88 percent. High observed frequencies at 15 points were achieved by clinicians achieving the maximum points in Improvement Activities (IA) but not participating in Quality or Advancing Care Information (ACI), and the high frequency at 40 points was due to clinicians achieving the maximum in IA and ACI but not participating in the Quality component.

Exhibit 2. Clinician Participation in Each Category of MIPS

Source: Authors’ analysis of 2017 MIPS performance data from CMS Physician Compare database. Notes: The circles illustrate clinicians not participating in each category of MIPS in 2017. Overlapping sections illustrate the percentages of clinicians not participating in two or more categories. For example, 5.8 percent of clinicians did not participate in either improvement activities and advancing care information (ACI). 10.9 percent did not participate in any categories, while 13.3 percent did not participate in only the ACI category.

Exhibit 3. Distribution of ACI Category Scores in MIPS Year 1

Source: Authors’ analysis of 2017 MIPS performance data from CMS Physician Compare database. Notes: The zero bar to the left of the distribution includes clinicians that did not participate in ACI and therefore received no score. For ACI, this includes 306,512 non-participant clinicians. Scores for are scaled to be out of 100 percent, rather than the points available for each component. Similar distributions of category scores for Quality and Improvement Activities are in Appendix Exhibit A2.