MACRA Basics

Merit-based Incentive Payment System (MIPS) Alternative Payment Models (APMs), or MIPS APMs

A MIPS APM is a subset of alternative payment models that differ from Advanced Alternative Payment Models (AAPMs) in several important ways. Use this guide to help you learn the ins and outs of MIPS APMs.

MIPS APM: An Overview

The Medicare Access and CHIP Reauthorization Act (MACRA) was passed and signed into law in April of 2015. MACRA created the Quality Payment Program (QPP), which aims to transition Medicare from volume-based to value-based payment models. The QPP consists of two payment tracks that eligible clinicians (ECs) can participate in:

• Merit-based Incentive Payment System (MIPS) or an 
• Advanced Alternative Payment Model (AAPM)

ECs in certain APMs that do not meet the criteria to be an AAPM and those who do not meet the payment threshold or the patient threshold to be considered a Qualifying Participant fall into a subset of APMs called “MIPS APMs.” 

MIPS APM Criteria

MIPS APM include APMs that do not meet the criteria (e.g., taking on financial risk) to become an AAPM. However, APMs must still meet the following criteria to be a MIPS APM:

• Entities must participate in the APM under an agreement with CMS or by law or regulation
• APM requires participating entities to include at least one MIPS-eligible clinician
• APM must base payment incentives on performance on quality and cost measures

Primary care MIPS APMs include:

• ACO Realizing Equity Access and Community Health (REACH)
• Maryland Total Cost of Care Program - Care Redesign Program
• Maryland Total Cost of Care Program – Primary Care Program Tracks 1, 2, and 3
• Medicare Shared Savings Program (MSSP) All Tracks (BASIC A-E, ENHANCED)
• Primary Care First
• Vermont Medicare ACO Initiative (as part of the Vermont All-Payer ACO Model)
• Additional models will be announced by CMS as they are approved

Most AAPMs are also considered MIPS APMs. Eligible clinicians in AAPM entities that do not meet either the patient threshold or payment threshold to be qualifying participants (QPs) and are considered partial QPs can opt to participate in MIPS. Partial QPs who elect to participate in MIPS must report through Traditional MIPS or the APM Performance Pathway (APP).

APM Performance Pathway (APP)

The APP is a pre-determined set of measures that can be reported by MIPS APM participants. It is required for all Medicare Shared Savings Program Accountable Care Organizations (MSSP ACOs). The APP reporting requirements are outlined below:

Quality (50% of final score)

• The APP quality measure set includes two administrative claims measures, three MIPS Clinical Quality Measures (MIPS CQMs)/eCQMs, and the Consumer Assessment of Healthcare Providers and Systems (CAHPS) for MIPS.
• MSSP ACOs may report either the APP measure set or the Web Interface measures. CMS will sunset the Web Interface in 2025 and ACOs will be required to report the APP measure set.
• The data completeness threshold for the APP is the same as in MIPS. For the 2023 performance year, participants must report on at least 70 percent of the encounters eligible for the measure’s denominator, regardless of payer.

APP Measure Set:

• Hospital-wide, 30-day, All-cause Unplanned Readmission Rate for MIPS Eligible Clinician Groups
• Clinician and Group Risk-standardized Hospital Admission Rates for Patients with Multiple Chronic Conditions
• Diabetes: Hemoglobin A1c Poor Control
• Preventive Care and Screening: Screening for Depression and Follow-up Plan
• Controlling High Blood Pressure
• Consumer Assessment of Healthcare Providers and Systems for MIPS

Cost (0% of final score)

• The cost category is re-weighted to 0%, as APP participants are held accountable for cost performance through their APM.

Improvement Activities (20% of final score)

• APP participants automatically receive full credit for the improvement activities performance category.

Promoting Interoperability (30% of final score)

• The promoting interoperability requirements are the same as MIPS. Participants must report all measures within the promoting interoperability measure set.
• Data is reported at the individual or group level. CMS calculates a score for the APM Entity using a weighted average of the scores received from individuals and/or groups in the APM Entity.