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2016 PQRS to 2018 Value-Based Adjustment

If you didn’t report 2014 PQRS measures you are already seeing a 2% reduction of reimbursement from Medicare. Providers had until March 31st to report via registry for 2015 activity to avoid a penalty in 2017.

In addition to PQRS, providers should be concerned about the Value-Based Payment Modifier (VBM) established by the Affordable Care Act. The modifier builds on PQRS in providing a differential payment based on the quality of care furnished to beneficiaries compared to the cost of that care. The current year adjustment only affects groups of 10 or more. The 2017 adjustment will affect all providers based on 2015 reporting. The modifier is not a CPT modifier like one would expect, but is tied to the provider’s Tax ID number. Individual patients are “attributed” to a provider’s practice. The modifier is based on PQRS and is composed of quality and cost “tiering” measures comparing to the mean of the provider’s peer group.

The modifier works as follows:

  • PQRS-reported quality information, along with CMS-calculated outcomes and cost measures are analyzed;

  • Each practice receives 2 composite scores; a quality and cost composite;

  • CMS classifies each score into “high”, “average”, or “low” based on standard deviation above/below or at the national mean score. This identifies statistically significant outliers;

  • CMS assigns practices to their respective quality and cost “tiers” to determine a positive, neutral or negative payment adjustment to their payment based on performance. This is known as “quality tiering” analysis.

During the Fall of 2016, CMS will make available to providers’ their Quality & Resource Use Report (QRUR) which will show the 2017 Value Modifier payment adjustment.

With sequestration, the potential reduction of reimbursement is 11% in 2017 with no PQRS or EHR and up to 13% in 2018. It’s time to think about reporting PQRS in 2016!

What is MIPS?

MIPS is the new Medicare payment incentive/penalty system which will begin in 2019. The SGR repeal in 2015 included the creation of a new pay-for-performance program called the Merit-Based Incentive Payment System (MIPS). This new program will replace the current PQRS, EHR and VBM as we know it now. The program is budget neutral, so for every provider that gets a pay increase, there is a provider whose pay is decreased by the same amount.

Providers are rated receiving a score on quality and performance. Payments will either go up or down based on the MIPS score. By 2022, significant payment adjustments will take place.

The MIPS score is calculated based on four areas:

  1. Quality (initially measures from PQRS, EHR, MU and QCDRs)

  2. Resource Use (initially VBM and episodes of care measures)

  3. EHR Meaningful Use

  4. Clinical practice improvement (gives credit for clinical practice improvement).

This composite score is then compared to a “benchmark” which will be the mean or median of the composite performance scores for all MIPS eligible professionals during a period prior to the performance period. This composite is basically a Bell Curve.

One thing is for sure, value-based pay for performance is not going away. If your practice isn’t participating, you are leaving a great deal of reimbursement on the table.

Start Now on 2016 PQRS!

If you’ve previously reported PQRS– take note that each year brings changes! Review your reporting measures for 2016 on to see if any changes will affect you. There are fewer measures that can be reported via claims. Included diagnoses and CPT codes have changed on some measures and entire measures have been deleted /replaced in reporting groups.

If you’ve never reported PQRS you should review the available Measures Groups first. The groups only require reporting on 20 patients for specific measures. There are 25 groups for 2016. The most common groups for our clients include Diabetes, Cataracts and Sinusitis.

Diabetic retinopathy, Cardiovascular Prevention and Multiple Chronic Conditions Measures are new reporting groups for 2016.

If none of the 25 measures groups are applicable to a provider then Individual Measures must be reported in the following manner:

  • Report 9 individual measures across 3 domains

  • Report on at least 50% of eligible Medicare Part B Fee For Service patients or encounters for each measure.

If a provider cannot report on 9 measures from 3 domains then they become subject to Measure Applicability Validation (MAV) where basically all you can report is reported.

  • Report 1 MAV cluster of clinically-related measures and/or report between 1-8 measures that are not included in any MAV cluster.

  • Report on at least 50% of eligible Medicare Part B Fee For Service patients or encounters for each measure.

MAV is worrisome because CMS has to determine if you reported all applicable measures. If they determine there was more to report, the provider will not be credited with their efforts.

Regardless how you report, take time NOW to review the requirements for 2016 to stop the hemorrhaging in 2018! Find new training resources at!

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