Avoid the 2% Medicare Quality Reporting Penalty: Get the Facts and Some Tips for Success

Date: December 10th, 2014Category: CORHIO e-NewsletterTopics: EHRs, Meaningful Use, PQRS, Transformation Support Services

Andrew Bienstock, CORHIO’s Transformation Services Manager, demystifies the Physician Quality Reporting System (PQRS) program and offers advice on selecting measures that make the most sense for your practice.

Q: What is the Physician Quality Reporting System program?

A: The Physician Quality Reporting System (PQRS) is a voluntary pay-for-reporting program where Medicare gives you an incentive to report your clinical quality measures. You choose measures that are relevant to your practice  – there are no thresholds you have to meet. PQRS is based on the calendar year and starts on the first of the year. Everyone must report on one full year and the reporting is due at the end of the following February. 2014 is the last year participants can receive incentive payments of 0.5% of Medicare Part B allowable charges, so now is an excellent time to get into this program.

If your practice has 10 or more physicians, you are automatically in the Value Based Payment Modifier program, which looks at the clinical measures you submitted for PQRS (plus cost, quality and hospital readmission data), and ranks Eligible Professionals against others in the country. The top Eligible Professionals receive an additional incentive and the lowest performing practices receive penalties in the second year of the program. Last year, the program was for 100+ provider practices, this year it is for 10+ provider practices, and next year, there will be no threshold -- all Eligible Professionals will be in this program (with a few exceptions).

Q: Who is eligible to participate in PQRS?

A: Generally any provider type, regardless of specialty, who has Medicare Part B allowable charges, is eligible to participate. (For more details, http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/downloads/Eligible_Professionals03-08-2011.pdf)

Q: Why should an Eligible Professional participate?

A: Overall, PQRS is one of the programs supporting the Triple Aim in health care. It’s a way for providers to support better consumer transparency and to gear up for a Pay-for-Performance reimbursement system. Specifically, there is a 0.5% financial incentive, which ends this year, if you successfully submit your measures.

The most important part is avoiding the penalties – this year, there’s a 2% penalty off your Part B reimbursement if you qualify for PQRS and don’t participate. Those in the Value Based Payment Modifier program get an additional penalty of 2% if they don’t participate.

Q: What are the different ways providers can report their quality data?

A: There are several ways an Eligible Professional can report PQRS measures:

  • Through CMS claims reporting via Quality Data Codes – this is very manual and time-consuming if your EHR doesn’t do it for you.
  • Registry through your EHR vendor – pulls your data out for you and report it. (Costs vary depending on vendor.)
  • Registry through a third party – you enter your own data for all nine measures. With this method, you can also choose measure group reporting. Some measure groups have as little as four quality measures to report on. (This service typically costs $250-$350 per provider per year.)
  • EHR direct reporting – practices pull down a file from their EHR and upload it to Medicare’s secure portal.
  • Data submission vendors – similar to the EHR direct reporting, but the vendor does the actual submission to Medicare for you.  

Q: What happens to all of this quality data providers are submitting?

A: The data is starting to be publically available on the Physician Compare website. There’s not much data right now, but more is being added as more providers report through the Value Based Payment Modifier program. The data is also put into a report (QRUR-Quality and Resource Use Report) given to the Eligible Professional each year. It’s a report card of sorts so they can see how they’re doing. The Eligible Professional will receive the QRUR before their data is published on the Physician Compare website.

Q: Do you have any general best practices or tips for successfully reporting to PQRS?


  • Choose the clinical measures that you’re reporting well on – that you have the highest percentages in.
  • Be sure the nine measures you choose to report on are across three of the National Quality Strategy domains. If you don’t, you might not qualify for an incentive payment.
  • Consider Measures Group reporting as an option for registry reporting.
  • Do double duty with your clinical quality measures. If you’re already doing Meaningful Use, you have to report on clinical quality measures anyway, so you might as well do PQRS as well.
  • For EHR direct reporting, start as early as you can in January. Sometimes the electronic reporting system can be slow.
  • Look at your practice’s quality data throughout the year – not just at the end of the year.

Q: Can CORHIO help practices with PQRS?

A: Yes, CORHIO has staff who specialize in PQRS and who can work hands-on with practices to make sure that the clinical quality measures physicians and their office staff select are the right ones for their practice. We can help you pick the ideal reporting choice for your EHR, run reports, submit to the IACS system, and make sense of the value-based payment modifier program. We can meet with practices on a regular basis to review quality measures and assist in interpreting the QRUR reports.  

If you’re just getting started with PQRS, CMS offers these step-by-step instructions.

For PQRS assistance, please contact us