Alternative Payment Model (APM) 

CMS released the proposed rule which identifies a number of models that will be considered Advanced APMs in 2017, and groups of clinicians with sufficient participation in one or a combination of these models will be excluded from MIPS and qualify for the 5 percent Medicare Part B incentive payment. 

Advanced APMs for 2017 include:

  • Comprehensive ESRD Care Model (Large Dialysis Organization arrangement)
  • Comprehensive Primary Care Plus (CPC+)
  • Medicare Shared Savings Program (Tracks 2 and 3)
  • Next Generation ACO Model
  • Oncology Care Model Two-Sided Risk Arrangement (available in 2018)

“Qualifying” participants in an Advanced APM are paid an annual 5 percent bonus equal to their Part B payments in the performance year. They are also exempt from MIPS. 

Sufficient participation is evaluated based on meeting specific thresholds regarding Part B revenue or patient counts. The thresholds are established by CMS and increase over time.

APM Thresholds

The Center for Medicare & Medicaid Services (CMS) has two methods for determining if participants are qualified; the Payment Amount Method, and the Patient Count Method. 

The Payment Amount Method consists of:

  • Sum of Part B payments for services from the Advanced APM to attributed patients
  • Sum of Part B payments for services from the Advanced APM for all patients
  • Divide the result of 1 by the result of 2 to determine the threshold score percentage
  • If it is at least 25 percent, all clinicians participating in the Advanced APM are deemed to be qualified, are eligible for the 5 percent bonus and are exempt from MIPS
  • If the threshold score is between 20 percent and 25 percent, all clinicians are deemed “partial” qualifying, they do not earn the 5 percent bonus but have the option to participate in MIPS or not

The Patient Count Method is similar but uses the attributed and attribution-eligible patient instead of the Part B payments. The 25 percent and 20 percent thresholds for qualified and partial qualifying are replaced by 20 percent and 10 percent respectively for 2017. Thresholds for both methods increase after 2017. 

CMS will calculate both methods and will select the result from the method that is most favorable to the clinician in terms of qualifying participation.