Policy Researchers: MIPS Must Be Redesigned to Achieve Clinical and Financial Outcomes
The Merit-Based Incentive Payment System (MIPS) embedded into physician payment under Medicare has been complex and controversial since its rollout in 2017, with some practicing physicians complaining that it has punished or sub-optimally incentivized them in different ways, while some healthcare policy experts and observers have asserted that MIPS has not gone far enough to prod physicians to practice measurably higher-quality medicine.
Now, a pair of healthcare policy researchers has come up with a set of proposals for the reform of the MIPS system that they believe could result in better quality outcomes. The title of the March 2 article in the Health Affairs Blog, “Medicare Should Transform MIPS, Not Scrap It,” goes right to the heart of the matter, arguing that MIPS should be reformed by “aligning it as closely as possible with alternative payment models (APMs)—payment arrangements that more directly link payment to value-based care. Medicare remains the nationwide leader in implementing APMs, which already account for more than one-third of all health payments in the US. Under this continued shift, clinicians would benefit from greater alignment between MIPS and APMs, which would reduce administrative complexity and harmonize financial incentives across traditional Medicare.”
Joshua M. Liao, M.D., MSc, FACP, is a board-certified internal medicine physician and the medical director of payment strategy at UW Medicine (the University of Washington, Seattle), where he is also an associate professor and director of the Value and Systems Science Lab in the UW School of Medicine. His payment and delivery redesign experience includes service on the national Physician-Focused Payment Model Technical Advisory Committee (PTAC) as well as the RUC Advisory Committee. Amol S. Navathe, M.D., Ph.D., is a core investigator at the Corporal Michael J. Cresenc Veterans Affairs Medical Center in Philadelphia and an assistant professor in the Department of Medical Ethics and Health Policy in the Perelman School of Medicine and a senior fellow at the Leonard Davis Institute of Health Economics at the University of Pennsylvania.
Drs. Liao and Navathe argue that three steps will be essential to transforming MIPS: changing the connection between clinical and cost performance; revising financial rewards in MIPS; and redesigning the program towards more explicit, predictable results.
As they write, “First, Medicare can couple clinicians’ performance in the Quality and Cost domains. Currently, MIPS evaluates quality and cost performance independently, assessing clinicians on quality measures that may be unrelated to cost measures in topic or care setting (for example, assessing quality based on ambulatory-based blood pressure screening but costs based on unrelated inpatient-based dialysis spending). This approach is misaligned with APMs, which define and evaluate value based on simultaneous quality and cost considerations.” Instead, they write, “To address these issues, Medicare should invest energy in creating cost measures to couple with related quality measures—for instance, evaluating the value of clinicians’ diabetes care by jointly considering quality via diabetes control measures and cost as via diabetes-related hospitalization spending. Unfortunately, such coupling is largely infeasible in MIPS as currently designed.”
Meanwhile, the researchers write, “Medicare could revise financial rewards in MIPS to better reflect APM incentives. Currently, MIPS incentives are structured as upward or downward reimbursement rate adjustments. This approach could unintentionally reward increased spending by paying clinicians higher rates for all services, while failing to expose clinicians to APM incentives, which are not based on reimbursement rates. Instead, Medicare could design more APM-aligned incentives for MIPS and apply them to different clinician types. Primary care-focused APMs such as Primary Care First are based in part on per-member-per-month payments. In turn, MIPS incentives for primary care clinicians could be based on per-beneficiary spending measures. Conversely, subspecialty-focused APMs, such as the Comprehensive Care for Joint Replacement Model, involve episode-based payments that could provide a basis for rewarding or penalizing subspecialists in MIPS.”
And, they insist, “Medicare should redesign MIPS to move clinicians through the program in a more explicit, predictable fashion. Currently, MIPS does not require clinicians to progress through specific competencies and milestones over time—a contrast to both the early overarching roadmap created for APMs, as well as recent changes to specific APMs such as the Medicare Shared Savings Program (after years of permitting clinicians to participate without financial risk, Medicare overhauled the program to require all participants to progress through a pathway toward downside-risk on set timelines). Creating a similar structure for MIPS would bring the program in line with APMs, offer clinicians more certainty about performance, and create a timeline that compels them to prioritize and make care improvement investments.”
