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Value-Based Payment Modifier Resource Center

A provision of the Patient Protection and Affordable Care Act implements a Value-Based Payment Modifier (VBPM) under the Medicare Physician Fee Schedule, which is directly tied to PQRS participation. 2016 PQRS performance will be used to determine the 2018 VBPM. The program will sunset after the 2018 payment adjustment year and be replaced by the new Merit-Based Incentive Payment System (MIPS), which is a consolidated quality reporting program under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). for more information about MIPS, visit MGMA's MACRA/QPP Resource Center.

The VBPM uses a two-year lookback schedule in which the performance year that is used to determine payment occurs two years prior. Therefore, 2016 PQRS performance will be used to determine the 2018 VBPM, which applies to nearly all Medicare Part B physicians and non-physician practitioners who are physician assistants (PAs), nurse practitioners (NPs), clinical nurse specialists (CNSs), and certified registered nurse anesthetists (CRNAs), including those participating in the Medicare Shared Savings Program for Accountable Care Organizations. The 2018 VBPM will be waived, however, if any eligible professional (EP) in the group participates in the Pioneer ACO model, Comprehensive Primary Care Initiative, Next Generation ACO model, Oncology Care Model, or Comprehensive ESRD model in 2016. Under the VBPM's mandatory quality tiering methodology, physicians, PAs, NPs, CNSs, and CRNAs may be subject to Medicare payment adjustments based on how their performance on quality and cost metrics compares to national averages and the size of their group practice. Specifically:

  1. Physicians, PAs, NPs, CNSs, and CRNAs in groups of ten or more EPs will be subject to a negative, neutral or positive payment adjustment ranging from -4% to +4x (where x equals the to-be-determined upward payment adjustment factor) based on how their performance on quality and cost measures compares with the national average.
  2. Physicians, PAs, NPs, CNSs, and CRNAs in groups of nine or fewer EPs and physician solo practitioners will be subject to a negative, neutral or positive payment adjustment ranging from -2% to +2x (where x equals the to-be-determined upward payment adjustment factor) based on how their performance on quality and cost measures compares with the national average.
  3. PAs, NPs, CNSs, and CRNAs who are solo practitioners and in groups consisting solely of non-physician practitioners will be held harmless from penalties but will be eligible for a positive payment adjustment up to +2x (where x equals the to-be-determined upward payment adjustment factor) based on how their performance on quality and cost measures compares with the national average.

Should physicians, PAs, NPs, CNSs, or CRNAs not satisfactorily participate in PQRS in 2016, they will face an automatic penalty in 2018 under the VBPM that is in addition to the penalty applied under PQRS.

For more information on the impact of the VBPM, visit MGMA's latest resource The Value-Based Payment Modifier: How to Prepare your Practice.

All practices should review their Quality and Resource Use Reports (QRUR), which contain information on how the VBPM could be applied to your practice. For more information and instruction on how to access your QRUR please visit MGMA’s QRUR Resource Center.

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