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Quality Payment Program (QPP)

What is the Quality Payment Program (QPP)?

The Quality Payment Program (QPP) is a healthcare payment initiative created by the Centers for Medicare & Medicaid Services (CMS). It was established under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) with the goal of improving the quality of care provided to Medicare beneficiaries while also controlling healthcare costs.

QPP reimburses Medicare providers, who are MIPS-eligible clinicians, for Medicare Part B covered professional services and rewards them for improving the quality of patient care and outcomes.

The QPP has two main tracks through which eligible providers can participate. Which track they choose will vary based on their practice, size, location, specialty, and patient population:

  1. Merit-based Incentive Payment System (MIPS): Most eligible clinicians participate in MIPS. MIPS evaluates clinicians based on four performance categories: cost, quality, promoting interoperability, and improvement activities. Providers receive a composite performance score that determines their Medicare payment adjustment. Based on their score, providers have the potential to have their payments adjusted by 9%, either positively or negatively.
  2. Advanced alternative payment models (APMs): An alternative payment model (APM) is a payment approach that gives added incentive payments to provide high-quality, cost-efficient care. APMs can apply to a specific clinical condition, a care episode, or a population. Examples of APMs include accountable care organizations (ACOs) and certain bundled payment models.

The difference between MIPS and APMs is the amount of risk providers are willing to take on and the amount of payment adjustment. APMs encourage providers to assume more financial risk and reward them for meeting certain performance metrics. While APMs offer additional opportunities for providers to engage in innovative care models and potentially earn higher rewards, they often involve substantial care delivery changes, which may not be feasible or practical for all providers.

How does the Quality Payment Program (QPP) improve healthcare?

The Quality Payment Program (QPP) aims to reward high-value, high-quality Medicare clinicians with payment increases, while reducing payments to those clinicians who aren’t meeting performance standards. Some of the program's objectives include:

  • Improving Medicare beneficiary population health and care received by Medicare beneficiaries 
  • Lowering costs to the Medicare program
  • Advancing the use of healthcare information between providers and patients
  • Expanding alternative payment model (APM) participation

It was designed to replace the sustainable growth rate (SGR) law, which capped increases in spending based on the growth of the Medicare population and led to less reimbursement for units of service.