For most doctors, Medicare payment system didn’t pay off

Doctor putting money in pocket
Only 20,000 doctors got a pay increase this year under Medicare's value-based payment program. (Getty/Niyazz)

The physician Medicare reimbursement system that was the predecessor to MIPS didn’t end up paying off for many doctors.

Few doctors or other clinicians will see a Medicare pay increase in 2018, the final year of the value-based modifier program, according to a fact sheet (PDF) from the Centers for Medicare & Medicaid Services (CMS).

The pay-for-performance program—now replaced by the Merit-based Incentive Payment System (MIPS) under MACRA—will provide 20,000 clinicians with between a 6.6% and 19.9% increase in their Medicare physician fee schedule payments in 2018 as a result of their high performance on quality and cost measures in 2016, the fact sheet said.


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That’s a small number considering an estimated 1.1 million clinicians bill Medicare annually.

“In 2018, the overwhelming majority of clinicians received neutral payment adjustments,” according to the fact sheet.

The value-based modifier program promised doctors more money for hitting key quality metrics in caring for patients. The good news is that all practices will receive an upward or neutral payment in 2018 based on performance on quality and cost measures, CMS said.

Typically, decreased payment adjustments are applied only to clinicians in practices that did not meet minimum quality reporting requirements. CMS said one-fourth of clinicians did not meet those requirements and would have received a downward payment adjustment.

However, practices got a break in 2018 and were held harmless if they didn’t meet those requirements as a result of policy changes in the 2018 physician fee schedule. CMS decided to give providers a pass this year in order to smooth the transition to MIPS.

Two recent studies found major flaws with the value-based modifier program—results that don’t bode well for the future success of MIPS, which is now entering its second year.

Researchers found the program failed to meet its goals and likely exacerbated disparities in healthcare delivery, driving providers to turn away low-income patients with complex care needs.

A separate study found that almost 30% of practices took a financial penalty that cut their Medicare revenue rather than participate in the program. CMS has yet to release figures on how many practices took a penalty in the first year of MIPS rather than report quality data.

The debate over the value of MIPS is ramping up. The Medicare Payment Advisory Commission voted earlier this month to recommend to Congress that it replace the complex program with an alternative payment system.

As much as they dislike aspects of MIPS, two major physician groups—the American Medical Association and the Medical Group Management Association—said they are not ready to abandon MIPS and want to see CMS fix the program instead.

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