PQRI Update
By: Christine Locay, JD, RHIA, CPC
Vice President, Corporate Compliance Counsel

In 2007, the Centers for Medicare and Medicaid Services (CMS) implemented the Physician Quality Reporting System or PQRS (formerly, the Physician Quality Reporting Initiative or PQRI), a voluntary claims-based reporting system.

Under the program, group practices or eligible providers that satisfactorily report data on PQRI measures for a particular reporting period are eligible to earn a PQRI incentive payment. The incentive payment is equal to a specified percentage of the group practice’s or provider’s total estimated Medicare Part B allowed charges for covered professional services furnished during the reporting period. In 2010, group practices or eligible providers were required to report quality data codes (QDCs) on eighty percent (80%) of eligible claims in order to receive the two percent (2%) incentive payment.

Under CMS’ 2011 final rule, two important changes were made to incentive payments. First, group practices or eligible providers must report QDCs on fifty percent (50%), instead of eighty percent (80%), of eligible claims to receive the incentive payment. Second, the incentive payment for calendar year 2011 is equal to one percent (1%), instead of two percent (2%), of the group practice’s or provider’s total estimated Medicare Part B allowed charges for covered professional services furnished during the 2011 reporting period.

In addition to the CMS final rule, the Affordable Care Act (ACA) implemented the following changes to the PQRI program:

(1) authorizing incentive payments through 2014;

(2) requiring a payment adjustment beginning in 2015 for eligible professionals who do not satisfactorily report data on quality measures in the applicable reporting period for the year [and such payment adjustments would be made by reducing the fee schedule payment by 1.5 percent in 2015 and 2.0 percent in 2016 and thereafter];

(3) requiring timely feedback to participating eligible professionals;

(4) requiring the establishment of an informal appeals process whereby eligible professionals may seek a review of the determination that an eligible professional did not satisfactorily submit data on quality measures for purposes of qualifying for a PQRI incentive payment;

(5) making available an additional incentive payment [of 0.5%] for those eligible professionals satisfactorily reporting data on quality measures for a year and having such data submitted on their behalf through a Maintenance of Certification Program and participating in a Maintenance of Certification Program practice assessment more frequently than is required to qualify for or maintain board certification status;

(6) requiring the establishment of a Physician Compare Web site; and

(7) requiring the development of a plan to integrate reporting on quality measures relating to the meaningful use of electronic health records (EHRs).

42 Fed. Reg. Parts 405, 409, 410, 411, 413, 414, 415, and 424, pp. 1054, 1095-99 (Nov. 2, 2010); CMS & HHS Fact Sheet, 2010.11.03: Physician Quality Reporting System and E-Prescribing Program, Nov. 3, 2010.

The information presented herein reflects general information that is current as of the date it was first published.  In light of changes that may occur in the health care regulatory and compliance environments, the author's presentation of this information might become outdated.  Please check with your individual legal and/or compliance advisor(s) prior to taking any significant actions based upon the information and advice presented.