2017 is fast approaching, and so is the Merit-based Incentive Payment System (MIPS), the new Medicare payment system for physicians and other clinicians.

Beginning in January, the Centers for Medicare & Medicaid Services will put in place a new payment system to implement the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). CMS estimates that more than 90% of eligible clinicians will participate in MIPS—one of the two payment paths set up under MACRA.

Here are three ways that practices and hospitals can prepare, according to a Hospitals & Health Networks report:

Understand the financial impact of the new system. MIPS penalties and bonuses start at 4% in 2017 and will grow to 9% in 2022, with additional money given to exceptionally performing clinicians. That adds up to an 18% to 28% payment swing between the best- and worst-performing clinicians in 2022, Joe Damore, vice president of population health management at Premier Inc., told the publication. The economic impact will be felt by hospitals and health systems, since many hospitals employ physicians.

Make decisions on how to participate. For instance, 2017 is a transition year to give providers time to adjust to the new reporting requirement and MACRA offers a “pick your pace” option. By reporting at least some data, such as one quality measure, clinicians will avoid a 4% penalty that will impact revenues in 2019. Physicians will also need to decide whether to report quality data as individuals or a part of a group practice.

Start slowly and build from there. You don’t need to make huge investments in data and analytics right away, said Evan Benjamin, M.D., chief quality officer at Baystate Health. Focus first on creating a physician-hospital network that engages clinicians in improvement activities, he recommended.

Here's some good news: Practices that are successful under current programs will probably be successful under MACRA, Mollie Gelburd, J.D., an associate director at the Medical Group Management Association, noted earlier this year at the association's annual conference in San Francisco.