2025 MIPS and MACRA updates: A guide for clinicians and medical billers

Over the last decade, the way in which Medicare pays clinicians has changed significantly. Long gone are the days in which clinicians can automatically earn more money by simply providing more services. While today’s clinicians do continue to receive fee-for-service (FFS) payments, they’re also increasingly held accountable for the quality of the care they render. 

It all goes back to a law introduced in 2015 called the Medicare Access and CHIP Reauthorization Act (MACRA). This law reformed the entire Medicare payment system by repealing the Sustainable Growth Rate formula for payment and replacing it with a value-based payment system.

Read on for essential 2025 MACRA and Merit-based Incentive Payment System (MIPS) updates impacting medical practices and billing companies.

MACRA is the law that required Medicare to establish valued-based payment models collectively referred to as the Quality Payment Program. Since Medicare implemented this program in 2017, the agency has continued to take steps toward a merit-based incentive payment system that represents a ‘new’ way of thinking about healthcare reimbursement. 

Under this program, payment models reward clinicians who provide high-value, high-quality care with payment increases while simultaneously reducing payments to clinicians who don’t meet performance standards. 

Patients are the beneficiaries of MACRA because they receive higher-quality care through the advanced use of healthcare information and more streamlined care coordination. MACRA also promotes patient education, engagement, and empowerment — all good things that can improve outcomes and help patients lead happier, healthier lives. 

However, clinicians benefit from MACRA as well because its payment models support them in improving patient satisfaction and providing meaningful care that aligns with value-based principles. Clinicians are paid to do exactly what they were trained (and deeply want) to do: keep patients healthy. 

MIPS is one way in which eligible clinicians can comply with MACRA. (Note: The other way is through advanced alternative payment models [APM] that are not covered in this article.) 

According to Medicare, MIPS was designed to “tie payments to quality and cost-efficient care, drive improvement in care processes and health outcomes, increase the use of healthcare information, and reduce the cost of care.”

In performance year 2025, there are 3 MIPS reporting options available to eligible clinicians:

MIPS-eligible clinicians include the following:

The short answer is ‘yes.’ All eligible clinicians in the United States must participate in MIPS. However, there are some exceptions. These include clinicians who qualify for one or more of the following:

Clinicians are exempt from MIPS if they meet the low volume threshold — meaning they: 

The MIPS Determination Period involves CMS reviewing past and current Medicare Part B claims and Provider Enrollment, Chain, and Ownership System (PECOS) data for clinicians and practices twice each performance year. These reviews determine MIPS eligibility and low-volume criteria. Each time, a review analyzes a 12-month period.

Clinicians and practices generally must exceed the low-volume threshold during each segment of the MIPS Determination Period to be eligible for MIPS.

It’s important to note that clinicians within the low-volume margin can still opt to join MIPS.

Determinations are assessed both individually and within group practice contexts. A clinician might not meet the low-volume threshold when reporting solo and thus be exempt from MIPS. However, if they report as part of a group practice that surpasses the threshold, they are then required to participate in MIPS.

Clinicians can use this tool to determine MIPS eligibility. If eligible, clinicians may be able to participate at one or more of the following levels: individual, group, virtual group, subgroup, or advanced APM entity. 

Clinicians may also have additional choices for participation depending on their chosen MIPS reporting option (i.e., traditional MIPS, APM Performance Pathway, or MVP).

The 4 performance categories that potentially drive the final MIPS score are: 

However, the specific contribution of these components (or lack thereof) to the final MIPS score depends on the reporting option an eligible clinician chooses (i.e., traditional MIPS, APM Performance Pathway, or MVP).

Under MIPS, eligible clinicians report certain data to Medicare and then earn a ‘MIPS performance score’ from 0-100. This score, known as the ‘final MIPS score,’ ultimately determines an eligible clinician’s future Medicare Part B payment adjustment — and particularly whether that adjustment is negative, neutral, or positive. 

More specifically, a performance year 2025 final MIPS score affects payment as follows:

However, it’s important to note that there is no immediate impact of MIPS data on payment. In fact, there’s actually a two-year delay. This means the data that eligible clinicians submit during performance year 2025 doesn’t affect payments until 2027. Likewise, current-day payments are based on a clinician’s MIPS score from performance year 2023. 

The MIPS performance year begins on January 1. The end date depends on the specific MIPS category. 

For quality and cost, the performance year ends on December 31 each year. To promote interoperability, it ends after 180 consecutive days. And for improvement activities, the end date depends on the specific activities selected.

Under traditional MIPS, a performance year 2025 final MIPS score is based on the following performance categories:

See the Appendices of the 2025 Quality Program Fact Sheet for more information about new, revised, and deleted measures in each of the categories listed above.

In general, APMs are designed to create a more stable and uniform set of MIPS reporting requirements that increase an eligible clinician’s confidence in moving into more risk-bearing arrangements.

For MIPS purposes, an APM Performance Pathway relies on a final MIPS score driven by these 3 performance categories:

To view the 2025 comprehensive list of APMs, visit this resource.

MVPs were brand-new for performance year 2023. Medicare created this reporting option to provide eligible clinicians with clinically related performance measures that align more closely with their specialty and scope of practice. 

In an MVP, clinicians select from a smaller, more meaningful set of quality measures and improvement activities. They also report on a set of foundational measures to promote interoperability as well as certain clinician-selected population MACRA MIPS health measures. 

In 2025, eligible clinicians can choose from the following:

The good news is that eligible clinicians can report multiple MVPs. For example, an entire internal medicine group can participate as a group to report the ‘value in primary care’ MVP, and a subset of those clinicians can participate as a subgroup to report the ‘advancing care for heart disease’ MVP.

Independent practices may face specific challenges when trying to meet MIPS requirements because they often operate with a smaller budget for training. This means clinicians and medical coders may not be aware of the 2025 performance year MIPS changes, and they may inadvertently overlook quality measure reporting opportunities. 

The good news is that there are plenty of free resources available that are tailored to small and independent practices. This includes a newsletter, a "quick start" guide for small practices, and more.  

Here are some important MIPS facts for small practices (i.e., practices with 15 or fewer clinicians identified by National Provider Identifier) to note:

To see whether your medical practice is considered a ‘small practice,’ visit Participation Lookup (cms.gov).

The Medicare cuts — sometimes referred to as Medicare sequestration cuts — are automatic reductions in Medicare FFS payments resulting from the Budget Control Act of 2011. Note that the MIPS payment adjustment percentage is applied to the Medicare paid amount for covered professional services after calculating deductible and coinsurance amounts but before sequestration.  

Each year, the Medicare Clinician Fee Schedule (MPFS) final rule outlines changes to the merit-based incentive payment program. What are the 2025 quality payment program changes that haven’t already been covered in this article? Here are a few of them:

MIPS performance year 2025 began on January 1, 2025. However, there are several other MIPS deadlines to know and bookmark on your calendar. These include the following:

The following are some strategies to promote revenue integrity:

It’s important to monitor these codes to understand MIPS performance and whether and how MIPS payment adjustments could affect medical practice revenue. This data gives clinicians insight into the types of claims that are adjusted so they can dig into and address any potential root causes.

CMS plans to sunset traditional MIPS in the future, at which point MVPs will become mandatory. However, it will be a while before this goes into effect. In the meantime, it makes sense to focus on traditional MIPS and choose the right measures for your medical practice. Learn how Tebra can help.