Policy Brief: The Urgent Need for MIPS Reform

Sept. 2024 

In 2016, the Centers for Medicare and Medicaid Services (CMS) introduced the Quality Payment Program (QPP) under the Medicare Access & CHIP Reauthorization Act (MACRA) to enhance healthcare service quality and value. The Merit-based Incentive Payment System (MIPS), a core component of QPP, aimed to incentivize high-quality care delivery. However, persistent flaws in MIPS implementation call for immediate and comprehensive reform.

Despite ongoing efforts by CMS to refine the Merit-based Incentive Payment System (MIPS), persistent challenges remain in the healthcare landscape. Various healthcare organizations, such as LUGPA and the American Medical Association (AMA), have raised significant concerns regarding MIPS implementation. These concerns revolve around several key issues:

1. Inconsistent Scoring: MIPS scoring lacks consistency, often inaccurately reflecting clinician performance. This disparity disproportionately penalizes providers serving marginalized communities, exacerbating healthcare disparities.
2. High Compliance Costs: Participation in MIPS incurs significant financial burdens, estimated at $12,800 per physician annually, alongside substantial time investments. These costs strain smaller, independent practices, limiting their capacity to invest in patient care improvements.
3. Impact on Healthcare Inequities: MIPS penalties disproportionately affect physicians serving vulnerable populations and those in independent practices, widening disparities in healthcare access and quality.
4. Effectiveness in Promoting Value-Based Care: Despite its goal of promoting value-based care, MIPS has shown limited effectiveness, particularly in diverse healthcare settings and independent practices.

Proposed Solutions: To address these challenges and create a more equitable and effective reimbursement system, the following reforms are crucial:

1. Adjustment of Payment Updates: Link automatic payment updates to the Medicare Economic Index to ensure fair compensation and alleviate financial strain on clinicians.
2. Revision of Budget Neutrality Requirements: Revise the Medicare physician pay schedule's budget neutrality requirements to prevent undue financial penalties for MIPS-eligible physicians.
3. Expansion of APM Participation: Increase the availability of alternative payment models (APMs) to provide clinicians with more viable pathways to value-based care participation

MIPS's shortcomings highlight the urgent need for reform to align reimbursement policies with healthcare quality improvement goals. By addressing scoring inconsistencies, reducing financial burdens, and expanding APM opportunities, policymakers can enhance MIPS's effectiveness and promote equitable healthcare delivery across diverse practice settings. Continuing to evaluate and refine MIPS is essential to achieving sustainable improvements in healthcare quality and access for all patients and providers alike.