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Value-Based Payment Modifier

Value Modifier Transition to the Quality Payment Program

Calendar Year 2015 (2015) was the first payment adjustment period under the Value-Based Payment Modifier (Value Modifier) based on performance in Calendar Year 2013 (2013). Calendar Year 2018 (2018) was the final payment adjustment period under the Value Modifier based on performance in Calendar Year 2016 (2016). Therefore, the Quality and Resource Use Reports (QRURs) are no longer available after December 31, 2018.  Frequently asked questioned related to the end of the Value Modifier program are available on the FAQs on the QRUR and Value-Based Payment Modifier [PDF, 222KB]  document.

The Merit-based Incentive Payment System (MIPS) under the Quality Payment Program has replaced the Value Modifier program. The Centers for Medicare & Medicaid Services (CMS) encourages everyone to learn more about the Quality Payment Program by visiting https://qpp.cms.gov/. Please note that the QRURs are not the same as the MIPS Performance Feedback available under the Quality Payment Program.

What is the Value-Based Payment Modifier (Value Modifier)

The Value Modifier provided for differential payment to solo practitioners and medical practice groups under the Medicare Physician Fee Schedule (PFS) based on the quality of care furnished compared to the cost of care during a performance period.  The Value Modifier was an adjustment made to Medicare payments for items and services under the Medicare PFS. It was applied at the Medicare-enrolled Taxpayer Identification Number (TIN) level to physicians (and beginning in 2018, to certain non-physician eligible professionals (EPs) billing under the TIN).

Quality and Cost Measures Used in the Value Modifier

We aligned the Value Modifier quality measurement component with the reporting requirements under the Physician Quality Reporting System (PQRS). Our primary interests in aligning these programs were to improve the quality of care for Medicare beneficiaries, to provide a common base that does not increase physician reporting burden, and to emphasize the importance of reporting quality performance.

In addition, the quality measurement component of the Value Modifier included up to three outcome measures that CMS calculated from Medicare Fee-For-Service claims:

  • Two composite measures of hospital admissions for ambulatory care-sensitive conditions
    • acute conditions
    • chronic conditions
  • One measure of 30-day all-cause hospital readmissions.  

For the cost measure component of the Value Modifier, we include the performance of 6 cost measures:

  • Total Per Capita Costs for All Attributed Beneficiaries measure,
  • Total Per Capita Costs for Beneficiaries with Specific Conditions: 
    • diabetes
    • coronary artery disease
    • chronic obstructive pulmonary disease
    • heart failure
  • Medicare Spending per Beneficiary (MSPB) measure (beginning with the 2016 Value Modifier). 

Calendar Year 2015 Payment Adjustment – Physicians in Groups of 100 or more EPs

In Calendar Year 2015 (2015), Medicare applied the Value Modifier to payments under the Medicare PFS for physicians in groups of 100 or more EPs.  Calendar Year 2013 (2013) was the performance period for the Value Modifier that was applied in 2015. In order to avoid an automatic negative one percent (“-1.0%”) Value Modifier payment adjustment in 2015, groups with 100 or more EPs were required to (1) self-nominate/register for a PQRS Group Practice Reporting Option (GPRO) and report at least one measure via the GPRO web interface or a registry, or (2) elect the CMS-calculated administrative claims option as a group in 2013.  Groups of 100 or more EPs that elected to have their Value Modifier calculated using the quality-tiering methodology were subject to upward, neutral, or downward payment adjustment in 2015.

Visit the 2013 QRUR and 2015 Value Modifier webpage for detailed information about the 2015 Value Modifier.  

Calendar Year 2016 Payment Adjustment - Physicians in Groups of 10 or more EPs

In Calendar Year 2016 (2016), Medicare applied the Value Modifier to payments under the Medicare PFS for physicians in groups of 10 or more EPs.  Calendar Year 2014 (2014) was the performance period for the Value Modifier that was applied in 2016. To be eligible for upward, downward, or neutral payment adjustments under the Value Modifier quality-tiering methodology and to avoid an automatic negative two percent (“-2.0%”) Value Modifier payment adjustment in 2016, EPs in groups with 10 or more EPs must have participated in the PQRS and satisfied reporting requirements as a group or as individuals in 2014.  Quality-tiering was mandatory for groups subject to the Value Modifier in 2016. Groups with 100 or more EPs were subject to upward, neutral, or downward adjustment under quality-tiering, and groups with between 10 to 99 EPs were subject to only upward or neutral adjustment under quality-tiering in 2016.

Visit the 2014 QRUR and 2016 Value Modifier webpage for detailed information about the 2016 Value Modifier. 

Calendar Year 2017 Payment Adjustment - Physician Solo Practitioners and Physicians in Groups of 2 or more EPs

In Calendar Year 2017 (2017), Medicare applied the Value Modifier to physician payments under the Medicare PFS for physician solo practitioners and physicians in groups of 2 or more EPs. This policy completed the phase-in of the Value Modifier to all physicians and groups of physicians as required by the statute. Calendar Year 2015 (2015) was the performance period for the Value Modifier that was be applied in 2017. To be eligible for upward, downward, or neutral payment adjustments under the Value Modifier quality-tiering methodology and to avoid an automatic negative two percent (“-2.0%”) (for physician groups with between 2 to 9 EPs and physician solo practitioners) or negative four percent ("-4.0%") (for physician groups with 10 or more EPs) Value Modifier payment adjustment in 2017, EPs in groups and solo practitioners must have participated in the PQRS and satisfied reporting requirements as a group or as individuals in 2015.  Quality-tiering was mandatory for groups and solo practitioners subject to the Value Modifier in 2017.  Groups with 10 or more EPs were subject to upward, neutral, or downward adjustment under quality-tiering, and groups with between 2 to 9 EPs and physician solo practitioners were subject to only upward or neutral adjustment under quality-tiering in 2017.

Visit the 2015 QRUR and 2017 Value Modifier webpage for detailed information about the 2017 Value Modifier. 

Calendar Year 2018 Payment Adjustment - Physicians, Physician Assistants, Nurse Practitioners, Clinical Nurse Specialists, and Certified Registered Nurse Anesthetists Who Were Solo Practitioners or in Groups of 2 or More EPs

In Calendar Year 2018 (2018), Medicare applied the Value Modifier to payments under the Medicare PFS for physicians, physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists who are solo practitioners and physicians, physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists in groups with 2 or more EPs. Calendar Year 2016 (2016) was the performance period for the Value Modifier that was applied in 2018. Avoiding the 2018 PQRS payment adjustment by satisfactorily reporting via a PQRS GPRO was one of the ways groups could have avoided the automatic downward payment adjustment and qualified for adjustments based on performance under the Value Modifier in 2018. Alternatively, groups could have also avoided the automatic downward payment adjustment and qualified for adjustments based on performance in 2018, if the EPs in the group participated in the PQRS as individuals in 2016 and at least 50% of the EPs met the criteria to avoid the 2018 PQRS payment adjustment. Solo practitioners could have avoided the automatic downward payment adjustment and qualified for adjustments based on performance in 2018 by meeting the criteria to avoid the CY 2018 PQRS payment adjustment as individuals.

Calendar Year 2018 was the final payment adjustment period under the Value Modifier.

Visit the 2016 QRUR and 2018 Value Modifier webpage for detailed information about the 2018 Value Modifier.