Advanced Alternative Payment Models 

Last year, the Centers for Medicare and Medicaid Services (CMS) consolidated their existing Medicare reporting programs into a single Quality Payment Program, under the newly-unveiled Medicare Access and CHIP Reauthorization Act (MACRA). All providers who care for more than 100 Medicare patients a year (or who bill Medicare for more than $30,000 a year) will now have the option of selecting between Merit-based Incentive Payment System (MIPS) or Advanced Alternative Payment Models (APM) for receiving Medicare reimbursements. As the MIPS option has already been discussed in detail here, this article offers a closer look at advanced APMs.

More on Advanced Alternative Payment Models (APMs)

Advanced APMs are an alternative payment option to MIPS that rewards practices who take on added risks when treating their patients. Physicians earn a 5% incentive payment in 2019 in return for either:

1) Receiving 25% of their Medicare Part B payments through an advanced APM advanced APM or

2) Seeing 20% of their Medicare patients through an advanced APM in 2017

CMS lists the following three criteria to determine whether a practice qualifies as an Advanced APM:

1) Practice uses a certified EHR technology.

2) Practice employs quality measures similar to those used in the MIPS quality performance category to provide payments

3) Practice takes on an increased financial risk for monetary losses, in forms such as reduced rates or withheld payments.

For more information about whether your practice qualifies as an APM, refer to CMS’s comprehensive list of qualified APMs (most recently updated on October 14th, 2016). This list broadly includes practices that are:


There are some clinicians who participate in APMs, but who do not meet the qualifying threshold of having sufficient payments or patients. These MIPS eligible clinicians are considered “MIPS APMs.” While MIPS APM clinicians still report through MIPS, they receive special MIPS scoring under the “APM Scoring Standard.” The APM Scoring Standard aims to reduce the MIPS reporting and scoring burden for eligible clinicians by allowing them to aggregate their MIPS scores at the APM entity level. All eligible clinicians within an APM would thus receive the same MIPS composite performance score.

The following rubric is for clinicians who qualify for special MIPS scoring under the APM Scoring Standard:

1) Quality – Report measures through their APM.

2) Improvement Activities – Automatically receive full credit for all current APMs and will receive at least half credit for all future APMs.

3) Advancing Care Information – Submit individually according to the MIPS requirements

4) Resource Use – No data submission required. Calculated from claims.

All “MIPS APM” eligibilities are also identified in the most recent CMS list.

Advanced APMs and Independent Providers

Advanced APMs therefore offer an alternative approach to physician reporting and reimbursement under MACRA. In particular, independent providers who choose to participate in advanced APMs maintain much of their practice’s autonomy that would be otherwise shared in a MIPS organization. Furthermore, this autonomy is preserved without the independent physician having to take on significant financial downside risk while simultaneously granting them access to the 5% annual advanced APM bonus. As MACRA continues to roll out, it is thus crucial for independent physicians to fully understand their eligibility options so that they can continue to maximize both their Medicare patients’ care and the reimbursements received for providing such quality work.