What Exactly is MACRA & What is MIPS?

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The healthcare industry is constantly evolving, with one of the most significant changes in recent years being the introduction of MACRA and MIPS, or the Medicare Access and CHIP Reauthorization Act and its associated Merit-based Incentive Payments System (MIPS).

For healthcare providers, understanding MACRA and MIPS is crucial. Participating in these programs can significantly impact your reimbursement rates and overall financial health.

That’s why, in today’s blog, we’ll answer what are MIPS and MACRA; we’ll explore what they are, how they work, and how they impact healthcare practices.


What is MACRA?

MACRA, or the Medicare Access and CHIP Reauthorization Act of 2015, is a law that changed the way Medicare pays physicians for the services they provide to beneficiaries.

The law was passed in response to concerns about the unsustainable growth in healthcare spending, along with the need to improve the quality of care delivered to patients.

Prior to MACRA, Medicare paid physicians under a fee-for-a-service model. Under this model, physicians were incentivized to provide more services, even if unnecessary, as this increased their revenue.

Under MACRA, Medicare pays physicians for the services they provide to beneficiaries while physicians are encouraged to participate in one of two payment models:

  • Alternative Payment Model (APMS)Under APMS, physicians are eligible for a 5% bonus payment.
  • Merit-based Incentive Payment System (MIPS) – Physicians who participate in MIPS can earn positive payment adjustments of up to 9% of their Medicare payments.

Overall, the objective of MACRA is to improve the quality of care delivered to patients while reducing healthcare costs, promoting the long-term sustainability of the Medicare program, and improving the overall health of Medicare beneficiaries.

What Are MACRA and MIPS Impacts


What is MIPS?

The Merit-based Incentive Payment System (MIPS) is a program created to help physicians transition to the new value-based payment model. The MIPS program is regulated and governed by the Quality Payment Program (QPP), and is made from combined parts of MACRA, including:

  • Value-based Payment Modifier (VMB)
  • The Physician Quality Reporting System (PQRS)
  • The Medicare Electronic Health Record (EHR) incentive program

Under MIPS, a physician’s performance is measured across four categories. These include:

  • Cost: This category measures the cost of care provided to patients. While physicians aren’t required to report on this category, their performance is measured based on Medicare claims data. These related measures include:
    • Total per capita cost
    • Episode-based cost measures
    • Medicare spending per beneficiary
  • Quality: Composed of 6 quality measures, this category measures the quality of care provided to patients while the other five measures are process measures that determine how well a physician adhered to evidence-based clinical guidelines.

What Are MACRA and MIPS Impacts on Your Organization?

Most professionals don’t have a clear understanding of MIPS and MACRA and how they can affect the practice
  • Improvement Activities: This measures effort to improve clinical practice. In this category, physicians must attest to completing the following activities:
    • Participating in a clinical trial
    • Implementing care coordination processes
    • Engaging in regular quality improvement activities
  • Promoting Interoperability: This measures the use of electronic health records (EHRs) and other health information technology to improve patient care. In this category, physicians are required to report on measures like:
    • Health information
    • The use of clinical decision support tools
    • Measures related to patient engagement

Scoring System for MIPS

The four categories of MIPS (cost, quality, improved activities, and promoting interoperability) are the backbone of the 100-point scale system used to measure a physician’s performance. A closer breakdown of the scoring system reveals the following:


MIPS Score System
CategoryMIPS ScoringImpact
  • Performance is derived on Medicare claims data and related measures (shared above)
  • Physicians must report on 6 quality measures
    • 1 outcome measure
    • 5 quality measures
  • The outcome measure assesses whether the care the physician provided resulted in a positive outcome for the patient
  • The other 5 measures are scored on a scale of 0 to 10 points, with up to 10 bonus points available for reporting additional high-priority measures
Improvement Activities15%
  • Physicians must attest to completing 4 activities that improve clinical practice.
  • Each activity is worth 10 points, for a total of 40 points – bonus points are available for reporting additional activities.
Promoting Interoperability25%
  • Physicians must report on 4 measures related to the use of EHRs and other health information technology used to improve patient care.
  • Each measure is gauged on a scale of 0 to 10 points, with up to 10 bonus points for reporting additional measures.
  • Physicians are required to earn no less than 50% of the total possible points in the category, otherwise they will face a penalty.


How MIPS and MACRA Impact Providers

The impact of MACRA and MIPS on healthcare practices is multifaceted.

For starters, physicians who participate in MIPS must report on a range of performance measures across several categories. This requires significant time and resources, as physicians must collect, analyze, and report on data related to patient outcomes, clinical processes, and resource utilization.

Additionally, the performance data collected under MIPS is made public through the Physician Compare website, which allows patients to compare the performance of different providers in their area. This puts pressure on physicians to improve their performance final score and deliver high-quality care that meets or exceeds performance standards.

Finally, MACRA and MIPS have financial implications for healthcare practices.

Physicians who perform well under MIPS are eligible for positive payment adjustments, while those who perform poorly may face a negative payment adjustment. These adjustments can have a significant impact on a practice’s bottom line, particularly for practices that are heavily dependent on Medicare payments.



Who Qualifies for MIPS?

It’s not uncommon for Medicare providers to wonder if they qualify for the MIPS program.

While it may seem straightforward that all Medicare providers qualify for MIPS, the reality is more complex. Several factors determine whether one qualifies for MIPS, including:

  • A practice’s volume
  • The type of practitioner
  • Whether you participate in a qualifying Alternative Payment Model (APM)

The Centers for Medicare & Medicaid Services (CMS) automatically qualifies physicians, physician assistants, nurse practitioners, clinical nurse specialists, and several other types of practitioners for MIPS.

However, if you fall outside these categories, you may not qualify for MIPS. 

Furthermore, you must have enrolled as a Medicare provider in 2021 or earlier, and your Medicare Part B claims must identify you as one of the eligible practitioners.

Another qualification factor is the volume threshold. To qualify for MIPS, your practice must exceed this threshold. This means you must have billed at least $90,000 for professional services covered under Medicare Part B, had more than 200 encounters with Part B patients, and provided Part B patients with at least 200 covered professional services.

The rules for individual and group qualifications are mostly the same, but there are a few differences. For instance, if you practice as part of a group, your group, not you alone, must exceed the low-volume threshold. Additionally, if you or your group meets only one or two of the three low-volume criteria, you can opt into MIPS, which could lead to higher reimbursements.


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How ISOwire Can Help With MACRA and MIPS

MACRA and MIPS are complex programs that require thoughtful consideration and planning to succeed. By participating in MIPS, providers can not only improve patient outcomes and quality of care but also increase their Medicare reimbursements.

Additionally, by leveraging technology and innovative solutions like ISOwire, providers can streamline their reporting and compliance with MACRA and MIPS, reducing administrative burdens and freeing up time to focus on patient care.

We help healthcare providers just like you with every aspect of MIPS reporting and compliance, from data collection and submission to quality measure selection and tracking. With ISOwire, automate data collection and submission, reducing the risk of errors and saving time and effort.

Furthermore, we offer real-time analytics and reporting, allowing you to monitor performance and adjust strategies as needed to maximize MIPS scores. So don’t wait – contact us today and get started.