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Analysis and Payment

Each year, the Physician Quality Reporting System (PQRS) incentive payment and the PQRS feedback report are issued through separate processes. PQRS feedback report availability is not based on whether or not an incentive payment was earned. Feedback reports will be available for every Taxpayer Identification Number (TIN) under which at least one eligible professional (identified by his or her National Provider Identifier, or NPI) submitting Medicare Part B PFS claims reported at least one valid PQRS measure a minimum of once during the reporting period. PQRS participants will not receive claim-level details in the feedback reports.

Incentive Payments

Eligible professionals who satisfactorily report quality-measures data for services furnished during a PQRS reporting period are eligible to earn an incentive payment equal to a percentage of the eligible professional's estimated total allowed charges for covered Medicare Part B Physician Fee Schedule (PFS) services provided during the reporting period.

Below are the authorized incentive payment amounts for each program year:

  • 2010 PQRS – 2.0%
  • 2009 PQRS – 2.0%
  • 2008 PQRS – 1.5%
  • 2007 PQRS – 1.5% subject to a cap

The Affordable Care Act authorized incentive payment through 2014:

  • 2011 PQRS – 1.0%
  • 2012 PQRS – 0.5%
  • 2013 PQRS – 0.5%
  • 2014 PQRS – 0.5%

Incentive payments for each program year are issued separately as a single consolidated incentive payment in the following year. Incentive payments are issued to the first valid group location listed under the TIN; or, for solo practitioners, to the first valid practice location listed under the TIN. The Medicare claims-processing contractors (Carrier or A/B MAC) will make the payment electronically or via check, based on how the TIN normally receives payment for Medicare Part B PFS covered professional services furnished to Medicare beneficiaries. If a TIN submits claims to multiple Carriers or A/B MACs, each contractor may be responsible for a proportion of the TIN incentive payment equivalent to the proportion of Medicare Part B PFS claims the contractor processed during the applicable reporting period. Note: If splitting an incentive across contractors would result in any contractor issuing a PQRS incentive payment less than $20 to the TIN, the incentive will be issued by fewer contractors than may have processed PFS from the TIN for the reporting period. The PQRS incentive payment can be offset by an outstanding debt for the TIN.

The incentive payment, with the remittance advice, will be issued by Carrier/MAC and identified as a separate payment under the PQRS. Medicare contractors will use the indicator of LE ("Levy") to indicate federally mandated payments. LE will appear in the PLB-03-1 segment of the 835. In an effort to further clarify the type of incentive payment issued LE will appear on the remit, along with a 4-digit code to indicate the type of incentive and reporting year.

For example, eligible professionals will see the LE to indicate an incentive payment, along with PQ10 to identify that payment as the 2010 PQRS incentive payment. Additionally, the paper remittance advice will read, "This is a PQRS incentive payment." The year will not be included in the paper remittance.

Once we begin distributing incentive payments for a particular program year and if your incentive does not arrive or the incentive payment amount does not match what is reflected in your PQRS feedback report, contact your Carrier or A/B MAC (click on the "Help Desk Support" link at left for contact information). Note: The incentive amount may differ by a penny or two from what is reflected in your feedback report due to rounding.

Important Notice!  Sequestration and Physician Quality Reporting System

Incentive payments made through PQRS are subject to the mandatory reductions in federal budgetary resources known as sequestration, required by the Budget Control Act of 2011. The American Taxpayer Relief Act of 2012 postponed sequestration for 2 months. As required by law, President Obama issued a sequestration order on March 1, 2013. Under these mandatory reductions, PQRS incentive payments made to eligible professionals and group practices will be reduced by 2%. For example: An EP has $100,000 in allowed charges. The 0.5% (0.005) incentive = $500. The $500 incentive will be reduced by 2% ($500 x 0.02= $10), so the total incentive payment with sequestration would be $490. This 2% reduction will be applied to any PQRS incentive payment for a reporting period that ends on or after April 1, 2013.  Since the 2013 reporting period ends after this date, incentive payments for this reporting period are subject to sequestration. Incentive payments for prior reporting periods will not be subject to the reduction.

2013 PQRS and/or eRx Incentive Program: Stripped N365 Remark Code

For those eligible professionals participating in the 2013 Physician Quality Reporting System (PQRS) and/or Electronic Prescribing (eRx) Incentive Program via claims, CMS is aware the Remittance Advice (RA)/Explanation of Benefits (EOBs) may not be displaying the N365 remark code for program quality-data codes (QDCs) for claims processed April 2013 through July 2013. The N365 remark code will reappear again starting for claims that are processed in July 2013. QDCs submitted on Medicare Part B Physician Fee Schedule (PFS) claims with $0.00 line items have been (and will be) processed into the National Claims History (NCH) file even though the RA/EOB did not indicate the N365 remark code, given the claim was in final-action status and not pended, rejected, etc.

What should I do if I don’t see the N365 Remark Code?

The N365 remark code on the RA/EOB is an indication that the QDC is associated with current program year PQRS and/or eRx Incentive Program specifications, but does not confirm whether the QDC was accurately reported per program requirements. If the QDC $0.00 line item shows on the RA, but without the N365, it is possible the QDC is not within current program year specifications. It is also possible that the N365 is simply missing due to reporting using the $0.00 line item. All submitted QDCs on fully processed claims are forwarded to the NCH for analysis by the PQRS and/or eRx programs, so providers will first want to be sure they do see the QDC line item on the RA/EOB, regardless of whether the N365 appears. If there is no QDC line item, it is possible that the provider’s claims software has stripped any $0.00 line items, and this will need to be corrected, either within the software, or by adding a $0.01 charge rather than $0.00.

Adding the $0.01 charge to the QDC line item will help generate the N365 remark code, which will indicate whether the QDC is current. Providers may work with their vendors/billing systems/clearing houses to determine whether the option to submit a $0.00 or $0.01 charge for QDC line items will work best for their practice.

Tips for Reporting

CMS would like to remind providers that no PQRS/eRx Incentive Program reporting validation or analysis occurs at the Carrier or A/B Medicare Administrative Contractor (MAC) claims level, beyond forwarding QDCs to the NCH. So it is imperative that providers make sure they are coding claims with the current program year measure specifications, either for individual measures or measures groups. They will want to verify that the patient they are reporting on falls within the measure’s denominator for age/gender, as well as diagnosis and service/encounter when applicable. Then be sure to follow the specifications showing the available numerator QDC reporting options, and report the one(s) that best describes the quality action performed.

Again, CMS is aware that RA/EOBs may not display the N365 remark codes for $0.00 QDC line items and is actively working with Carrier/Medicare Administrative Contractors (MACs) to resolve this issue. The N365 remark code will reappear again with claims that are processed after July 2013.

2013 PQRS

2013 PQRS Feedback Report User Guide

A quick reference guide for understanding the 2013 PQRS Feedback Report has been posted on this page.  The Physician Quality Reporting System (PQRS) Feedback Report User Guide is designed to assist eligible professionals (EPs) and their authorized users with accessing and interpreting the 2013 PQRS feedback reports. To view this document click on the following link:  2013 PQRS Feedback Report User Guide.

2013 Interim Feedback Dashboard User Guide

The 2013 Interim Feedback Dashboard User Guide is designed to assist eligible professionals, and their authorized users, with accessing and interpreting the 2013 interim Dashboard data. The Dashboard allows organizations and eligible professionals to log-in to a web-based tool and access interim PQRS data on a quarterly basis in order to monitor the status of claims-based individual measures and measures group reporting. To view this document click on the following link: 2013 Interim Feedback Dashboard User Guides.

2013 PQRS Incentive Payment User Guide

This document describes how the 2013 PQRS incentive payment was calculated for 1) individual eligible professionals (EPs), 2) self-nominated/registered group practices participating via the Group Practice Reporting Option (GPRO), and 3) EPs participating in PQRS through another program such as Medicare Shared Savings Program (MSSP), Comprehensive Primary Care Initiative (CPCI), or Pioneer Accountable Care Organizations (ACOs).  To view this document click on the following link: 2013 PQRS Incentive Payment User Guide. 

Note: The Dashboard does not provide the final data analysis for full-year reporting, or indicate PQRS incentive eligibility. The Dashboard will only provide claims-based data for interim feedback. Data submitted via registry reporting, CMS-selected Group Practice Reporting Option (GPRO), Center for Medicare and Medicaid Innovation (CMMI, includes Physician Group Practice [PGP] and Accountable Care Organizations [ACO] participants), or qualified Electronic Health Records (EHR) systems will not be included for purposes of the Dashboard data feedback. Data submitted for 2013 PQRS reporting via methods other than claims will be available for review in the fall of 2014 through the final PQRS feedback report.

2014 PQRS Measure-Applicability Validation (MAV) Process for Claims and Registry-Based Reporting of Individual Measures

The following documents pertaining to the 2014 (PQRS) Measure-Applicability Validation (MAV) Process for Claims-Based Reporting of Individual Measures are available in the zip file titled "2014 PQRS Claims Measure Applicability Validation Documents" in the "Downloads" section below:

  • 2014 PQRS Measure-Applicability Validation (MAV) Process for Claims-Based Reporting of Individual Measures – provides guidance for those eligible professionals who satisfactorily submit quality-data codes for fewer than nine PQRS measures or for fewer than three NQS domains, and how the MAV process will determine whether they should have submitted QDCs for additional measures.
  • 2014 PQRS Measure-Applicability Validation (MAV) Process Release Notes – the release notes for the changes occurring from the 2012 PQRS Measure-Applicability Validation (MAV) Process.
  • 2014 PQRS Claims-Based Measure-Applicability Validation (MAV) Process Flow – a chart that depicts the MAV Process for claims-based reporting.

The following documents pertaining to the 2014 (PQRS) Measure-Applicability Validation (MAV) Process for Registry-Based Reporting of Individual Measures are available in the zip file titled "2014 PQRS Registry Measure Applicability Validation Documents" in the "Downloads" section below:

• 2014 PQRS Measure-Applicability Validation (MAV) Process for Registry-Based Reporting of Individual Measures – provides guidance for those eligible professionals who satisfactorily submit via a Qualified Registry for fewer than nine PQRS measures or for fewer than three NQS domains, and how the MAV process will determine whether they should have submitted additional measures.
• 2014 PQRS Registry-Based Measure-Applicability Validation (MAV) Process Flow
– a chart that depicts the MAV Process for registry-based reporting.

2012 PQRS eRx Experience Report

The following documents pertaining to the 2012 Physician Quality Reporting System (PQRS) and Electronic Prescribing (eRx) Experience Report are available in the zip file titled "2012 PQRS and eRx Experience Report" in the "Downloads" section below:

  • 2012 Physician Quality Reporting System (PQRS) and Electronic Prescribing (eRx) Experience Report - summarizes the reporting experience of eligible professionals in these programs in 2012, historical trends, and preliminary results for the 2013 program year.
  • 2012 PQRS and eRx Incentive Program Release Appendix - provides tables and explains data and methods for the report.

A data brief highlighting participation in these programs in 2012 is also available.