Practitioner Resources

PQRI to shift from bonus payment to penalty program

Under the new federal health care reform law, the Physician Quality Reporting Initiative (PQRI) becomes a mandatory rather than voluntary Medicare reporting program in 2015.

by Government Relations Staff

June 30, 2010 — The Patient Protection and Affordable Care Act of 2010 (PPACA) makes several changes to Medicare’s voluntary reporting program known as the Physician Quality Reporting Initiative (PQRI). This program currently offers bonuses to providers who report on designated quality measures.

The change of greatest importance to psychologists will be PQRI’s transformation from a voluntary bonus program to one in which penalties will be assessed against providers who do not successfully participate.

Currently physicians and specified other health care professionals including psychologists are eligible to participate in PQRI. Successful participation generally requires that providers report on at least 80 percent of their applicable cases. Providers who have several applicable measures must report on at least three, but those providers who are able to utilize only one or two measures are still eligible for the bonus. PQRI will continue to provide bonuses of 1.0 percent for 2011 and 0.5 percent for 2012 through 2014.

However, in 2015 the program becomes mandatory and switches to imposing penalties on those who do not successfully report. The penalty is 1.5 percent for 2015 and increases to 2.0 percent for 2016 and subsequent years.

PPACA does not make clear just how this penalty will be applied. The Centers for Medicare and Medicaid Services (CMS) will have to address this matter and many other questions through regulations. For example, there will have to be a way to determine whether an individual provider has applicable measures on which to report before he or she can be penalized. Another key issue will be when the penalty is applied.  If successful reporting can only be determined after the reporting period is over, retroactive adjustments would have to be made for claims already processed, which in turn suggests that providers might be expected to return money.

A May 2009 letter to Senate Finance Committee Chairman Max Baucus and Ranking Member Charles Grassley affirmed the American Psychological Association’s (APA) objection to the imposition of penalties under PQRI and requested that the program remain voluntary.

The new legislation directs the Department of Health and Human Services (HHS) to provide eligible professionals with timely feedback on their performance in submitting data on quality measures. HHS must have an informal appeals process in place by January 1, 2011 to review the determination that an individual failed to satisfactorily submit data.

Further, HHS must develop a plan to integrate reporting on PQRI measures with electronic health records (EHR) reporting requirements by January 1, 2012.