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Merit-based Incentive Payment System (MIPS)

What is the Merit-based Incentive Payment System (MIPS)?

Since the passing of MACRA in 2015, CMS is required by law to maintain a quality payment incentive program. This program, known as the Quality Payment Program, breaks down into two plans: The Merit-based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs).

Under MIPS specifically, clinicians are weighed against four performance categories to produce a final score. This score is used to calculate the eventual payment adjustment, which determines the final reimbursement rate for a claim. The four scoring categories in MIPS are:

  • Quality performance
  • Promoting Interoperability (PI)
  • Improvement Activities
  • Care Cost

Why is MIPS important in healthcare?

MIPS is designed to incentivize higher quality and more cost-efficient care, improve care processes and health outcomes, as well as increase the use of healthcare information to better inform decision-making.

CMS sets the example for what can be done in the healthcare industry. MIPS is a powerful step away from fee-for-service payment models that encourage providers to over treat patients for greater return. Private insurers can take note of the success of MIPS and choose to follow suit or implement their own variations that can also contribute to the overall betterment of healthcare in the U.S.