April 27, 2016 — The Department of Health and Human Services (HHS) issued a proposal to align and modernize how Medicare payments are tied to the cost and quality of patient care for hundreds of thousands of doctors and other clinicians. The Notice of Proposed Rulemaking is a first step in implementing certain provisions of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). This legislation — supported by a bipartisan majority and stakeholders such as patient groups and medical associations — ended more than a decade of last-minute fixes and potential payment cliffs for Medicare doctors and clinicians, while making numerous improvements to America’s healthcare system.
“The legislation Congress passed a little over a year ago was a milestone in our efforts to advance a healthcare system that rewards better care, smarter spending and healthier people,” said HHS Secretary Sylvia M. Burwell. “We have more work to do, but we are committed to implementing this important legislation and creating a healthcare system that works better for doctors, patients and taxpayers alike. We look forward to listening to and learning from the public on our proposal for how to advance that goal.”
Currently, Medicare measures the value and quality of care provided by doctors and other clinicians through a patchwork of programs. Some clinicians are part of Alternative Payment Models such as the Accountable Care Organizations, the Comprehensive Primary Care Initiative and the Medicare Shared Savings Program — and most participate in programs such as the Physician Quality Reporting System (PQRS), the Value Modifier Program and the Medicare Electronic Health Record (EHR) Incentive Program.
Congress streamlined these various programs into a single framework to help clinicians transition from payments based on volume to payments based on value. The new proposed rule would implement these changes through the unified framework called the Quality Payment Program, which includes two paths:
- The Merit-based Incentive Payment System (MIPS); and
- Advanced Alternative Payment Models (APMs).
“We are working with the medical community to advance our collective vision for Medicare payment reform,” said Patrick Conway, M.D., CMS acting principal deputy administrator and chief medical officer. “By proposing a flexible, rather than a one-size-fits-all program, we are attempting to reflect how doctors and other clinicians deliver care and give them the opportunity to participate in a way that is best for them, their practice and their patients. Reducing burden and improving how we measure performance supports clinicians in doing what they do best – caring for their patients.”
Most Medicare clinicians will initially participate in the Quality Payment Program through MIPS. The ACA moved many Medicare payment systems, including that for clinicians, towards value, and MACRA builds on that work. Consistent with the goals of the law, the proposed rule would improve the relevancy and depth of Medicare’s quality-based payments and increase clinician flexibility by allowing clinicians to choose measures and activities appropriate to the type of care they provide. MIPS allows Medicare clinicians to be paid for providing high-value care through success in four performance categories: Quality, Advancing Care Information, Clinical Practice Improvement Activities and Cost:
- Quality (50 percent of total score in year 1): For this category, clinicians would choose to report six measures from among a range of options that accommodate differences among specialties and practices;
- Advancing Care Information (25 percent of total score in year 1): For this category, clinicians would choose to report customizable measures that reflect how they use technology in their day-to-day practice, with a particular emphasis on interoperability and information exchange. Unlike the existing reporting program, this category would not require all-or-nothing EHR measurement or redundant quality reporting;
- Clinical Practice Improvement Activities (15 percent of total score in year 1): This category would reward clinical practice improvements, such as activities focused on care coordination, beneficiary engagement and patient safety. Clinicians may select activities that match their practices’ goals from a list of more than 90 options; and
- Cost (10 percent of total score in year 1): For this category, the score would be based on Medicare claims, meaning no reporting requirements for clinicians. This category would use 40 episode-specific measures to account for differences among specialties.
The proposed rule seeks to streamline and reduce reporting burden across all four categories, while adding flexibility for physician practices. CMS would begin measuring performance for doctors and other clinicians through MIPS in 2017, with payments based on those measures beginning in 2019.
Thanks to new tools created by the Affordable Care Act, increasing numbers of Medicare clinicians are participating in alternative payment models. Building on the Affordable Care Act, the bipartisan MACRA legislation created additional rewards for clinicians who take this further step towards care transformation. Medicare clinicians who participate to a sufficient extent in Advanced Alternative Payment Models would be exempt from MIPS reporting requirements and qualify for financial bonuses. These models include the new Comprehensive Primary Care Plus (CPC+) model, the Next Generation ACO model, and other Alternative Payment Models under which clinicians accept both risk and reward for providing coordinated, high-quality care.
Many clinicians who participate to some extent in Alternative Payment Models may not meet the law’s requirements for sufficient participation in the most advanced models. The proposed rule is designed to provide these clinicians with financial rewards within MIPS, as well as to make it easy for clinicians to switch between the components of the Quality Payment Program based on what works best for them and their patients.
CMS expects that the number of clinicians who qualify as participating in Advanced Alternative Payment Models will grow as the program matures.
For more information: www.hhs.gov
March 13, 2026 
