Centers for Medicare & Medicaid Services Merit-based Incentive Payment System

Centers for Medicare & Medicaid Services Merit-based Incentive Payment System
Name	Merit-based Incentive Payment System
Formation	2015
Jurisdiction	United States
Parent organization	Centers for Medicare & Medicaid Services

Centers for Medicare & Medicaid Services Merit-based Incentive Payment System is a payment and performance program administered by the Centers for Medicare & Medicaid Services that adjusts Medicare Part B clinician payments based on quality, resource use, advancing care information, and improvement activities. Established under the Medicare Access and CHIP Reauthorization Act, the program intersects with policies from the Department of Health and Human Services, influences behavior among clinicians covered by Medicare, and operates alongside alternative payment models promoted by the Office of the Secretary.

Overview

The Merit-based Incentive Payment System emerged from the Medicare Access and CHIP Reauthorization Act of 2015 and interacts with initiatives from the Department of Health and Human Services, the Office of Inspector General, the Department of Veterans Affairs, the Social Security Administration, and state Medicaid agencies. It replaced the Sustainable Growth Rate formula, drawing on frameworks used by the Agency for Healthcare Research and Quality, the National Quality Forum, the Joint Commission, the American Medical Association, and the American Hospital Association. The program’s design references payment reform precedents such as the Affordable Care Act, the Medicare Shared Savings Program, the Physician Quality Reporting System, the Value-Based Purchasing program, and programs overseen by the Centers for Disease Control and Prevention.

Eligibility and Participation

Eligibility rules specify clinician types and organizational entities eligible for participation, including physicians recognized by the American Board of Medical Specialties, nurse practitioners certified through the National Council of State Boards of Nursing, physician assistants credentialed via the American Academy of Physician Associates, clinical nurse specialists, certified registered nurse anesthetists, and groups or virtual groups defined by CMS policy documents. Participation pathways consider exemptions tied to low-volume thresholds, participation in Alternative Payment Models endorsed by the Center for Medicare and Medicaid Innovation, and hardship applications reviewed with input from the Department of Justice and the Office of Personnel Management. Organizations such as the American Medical Association, the American Osteopathic Association, the Federation of State Medical Boards, and specialty societies influence guidance and educational outreach to eligible clinicians.

Performance Categories and Scoring

Scoring comprises distinct categories: Quality measures aligned with the National Quality Forum and the Agency for Healthcare Research and Quality measure sets; Cost/resource use measures developed with claims analysis used by the Medicare Payment Advisory Commission; Advancing Care Information elements based on health information technology frameworks from the Office of the National Coordinator for Health Information Technology and standards from Health Level Seven International; and Improvement Activities informed by models from the Patient-Centered Outcomes Research Institute, the Institute for Healthcare Improvement, and professional societies like the American College of Physicians and the American Academy of Family Physicians. Composite scores are calculated using methodologies similar to those applied in the Hospital Readmissions Reduction Program and the Hospital-Acquired Condition Reduction Program, and ties to benchmarks reflect historical performance and national standards used by the Centers for Disease Control and Prevention and the National Institutes of Health.

Payment Adjustment Methodology

Payment adjustments apply to Medicare Part B Physician Fee Schedule payments and are budget-neutral in many implementation years, reflecting statutory requirements from Congress and oversight from the Government Accountability Office. Adjustments are determined by composite performance scores compared against performance thresholds and exceptional performance bonuses, with methodologies paralleling those used by the Office of Management and Budget for budget-neutral transfers and by the Congressional Budget Office in scoring legislation. The Center for Medicare and Medicaid Innovation’s Alternative Payment Models provide an opt-out pathway affecting payment adjustment calculations, and reconciliation processes involve claims adjudication handled by Medicare Administrative Contractors and fiscal intermediaries.

Reporting Requirements and Data Submission

Clinicians submit data through mechanisms including claims-based reporting, registry submission to entities accredited by the National Committee for Quality Assurance, direct electronic health record reporting consistent with standards from the Office of the National Coordinator for Health Information Technology, and attestation portals operated by CMS. Data submission deadlines and validation processes reference procedures used by the Internal Revenue Service for electronic filings, by the Bureau of Labor Statistics for survey data integrity, and by the Social Security Administration for beneficiary records. Third-party intermediaries such as Qualified Clinical Data Registries, health information exchanges like those certified under the Trusted Exchange Framework and Common Agreement, and professional registries administered by organizations like the American College of Surgeons often assist clinicians in meeting reporting requirements.

Criticisms, Impact, and Policy Changes

Critiques echo analyses from the Government Accountability Office, academic studies in journals supported by the National Institutes of Health, and policy commentary from think tanks such as the Brookings Institution and the Kaiser Family Foundation, focusing on administrative burden, measure validity, disparities in performance across safety-net providers studied by the Commonwealth Fund, and the potential for unintended consequences documented by the Institute of Medicine. Empirical impact assessments reference research from Harvard Medical School, Johns Hopkins University, Stanford University, and the University of Pennsylvania evaluating care quality, cost, and access. Policy adjustments over time have been shaped by rulemaking in the Federal Register, congressional hearings before committees such as the House Ways and Means Committee and the Senate Finance Committee, and recommendations from advisory bodies including the Medicare Payment Advisory Commission and the Physician-Focused Payment Model Technical Advisory Committee.

Category:Medicare programs