Is it Time to Join an Alternative Payment Model?

Have you been participating successfully in the Merit-based Incentive Program (MIPS). Possibly it is a good time to investigate joining an Alternative Payment Model (APM)? APMs were developed by the Centers for Medicare & Medicaid Services (CMS) in concert with the clinician community. They were developed to provide additional incentives for clinicians to administer high-quality healthcare at less cost. If you are already doing the work wouldn’t it be nice to benefit from greater incentives?

Providing high-quality care at a lower cost may sound counterintuitive, however, the implementation of APMs has done just that for patients. APMs use a quality-based patient-centered approach. Focusing on preventive and transitional care, and increased care management of patients with chronic conditions.

MIPS eligible clinicians who are in a MIPS APM are responsible for MIPS participation, however, your participation can cover most if not all of the MIPS categories.

Let’s dive into specifics on APMs.

Types of APMs

There are MIPS APMs and non-MIPS APMs any APM must meet the legal definition of an APM. MIPS APMs have MIPS eligible clinicians participating in the APM on their CMS-approved participation list.

Non-MIPS APMs are generally targeted to a specific episode of care. There is the Bundled Payments for Care Improvement which is targeted to hospitalizations. This APM does not require Certified Electronic Health Record Technology or quality measures. There are also APMs targeted at End-Stage Renal Disease and Oncology. The requirements are different for each but do include a financial incentive tied to cost savings and for some quality.


Are designed for MIPS eligible clinicians. Participants are accountable for the cost and quality of care provided to Medicare beneficiaries. Also participants receive special MIPS scoring under the APM scoring standard. We will cover this later.

MIPS APM Criteria

  • The APM Entities participate in the APM under an agreement with the Centers for Medicare and Medicaid Services (CMS);
  • The APM requires that APM Entities include at least one MIPS clinician on a Participation List; and
  • The APM bases payment incentives on performance (either at the APM Entity or clinician level) on cost/utilization and quality measures.

Two examples of MIPS APMs are:

  • Medicare Shared Savings Programs – this APM is for a coordinated group of practitioners to work together to provide high-quality care at a cost savings. These groups are Accountable Care Organizations (ACO). ACOs have an agreement with CMS and an approved list of participants. The enhanced incentive is in the name. Participants in an ACO will receive a share of savings they produce for CMS. Depending on the level it could be as much as 50% of the savings. The savings is based on risk-adjusted expected costs for patients that are assigned to the clinicians.
  • Primary Care First – this APM is not yet available but will be soon. This APM is also voluntary but is for an individual. Clinicians are assigned patients based on charges for Annual Wellness Visits and Welcome to Medicare visits. Clinicians are paid a flat fee for office visits and a few other CPTs. The additional incentive comes quarterly in

Learn more about MIPS APMs.

Advanced APMs

Advanced APMs tend to be MIPS APMs. The MIPS eligible clinician will be scored under MIPS according to the APM scoring standard.

MIPS Eligible clinicians participating in Advanced APMs are able to become a Qualifying APM Participant (QP). Clinicians must meet quality and patient threshold to become a QP. If a clinician is a QP they are not required to submit MIPS data.

An Advanced APM is a track of the Quality Payment Program that offers a 5 percent incentive for achieving threshold levels of payments or patients through Advanced APMs. If you achieve these thresholds, you are excluded from the MIPS reporting requirements and payment adjustment.

Advanced APM Criteria

  • Require participants to use certified electronic health record technology (CEHRT);
  • Provide payment for covered professional services based on quality measures comparable to those used in the quality performance category of the Merit-based Incentive Payment System (MIPS); and
  • Either: (1) be a Medical Home Model expanded under CMS Innovation Center authority; or (2) require participating APM Entities to bear more than a nominal amount of financial risk for monetary losses.

An example of an Advanced APM is the Medicare Shared Savings Programs. There are several tracks. The basic track is a MIPS APM, however, Tracks 1 – 3. In the advanced tracks, there is some financial risk. This means if the ACO does not create cost savings but a cost increase they are responsible for paying a portion of the increase. The incentive though is a 5% lump sum payment of all Medicare allowable charges. Thus you receive a portion of the savings as well as the 5% bonus.

Learn more about Advanced APMs.

All-Payer/Other-Payer Option

In the All-Payer or Other-Payer options, eligible clinicians must participate in a combination of an Advanced APM with Medicare and Other-Payer Advanced APMs. Other-Payer Advanced APMs are non-Medicare payment arrangements that meet criteria that are similar to Advanced APMs under Medicare.

Learn more about All-Payer Advanced APMs.

APM Scoring Standard

The APM Scoring Standard is adjusted because of the activities performed to be successful in a MIPS APM. The percentages for MIPS categories are weighted differently. Because cost savings is one of the goals in APMs the cost category is not included in the clinician MIPS score. The other categories are reweighted. You can see the percentages below.

Things to note for scoring in APMs there are set Quality measures in which to perform. There is not a list from which to choose. Improvement Activities may be scored automatically due to the activities included in APMs. Promoting Interoperability is not included in APM activities so performance in this category is on an individual basis, however, scoring is an average across the participants in some APMs.

APM Standard

MIPS Scoring Standard

Now is the time to consider participating in an APM. If you are performing well in MIPS you will perform well in an APM and deserve the incentives. You now have some information on your choices and can begin to dig further into the details of each type of APM to find what is right for you.

As always we are here to assist you in all things MIPS so please reach out if you would like assistance in exploring these opportunities. Contact us at 844-205-5540 Monday – Friday 8:30am – 5pm (Central Time) or through email