E10, Part 3 – Get the Facts on COVID-19: Impacts on Provider Performance-Based Payment Incentives

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Tune into part 3 of our tenth episode of Avalere Health Essential Voice podcast series. In this segment, Avalere experts from the Center for Healthcare Transformation will discuss the impacts of the COVID-19 pandemic on provider performance-based incentive programs.
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“There are some specialties that have been asking for targeted and urgent relief payments from the federal government. And this is a result of feeling that these specialties, especially OB/GYN have been excluded from the distributions that have been aimed at alleviating the financial fallout from the disruption of care due to COVID-19.” Sura Edmond


Angel Valladares , Consultant II

Angel Valladares provides strategic guidance and implementation support for various healthcare stakeholders, specifically on digital health, real-world evidence generation, quality measure development and adoption, and patient and provider engagement.

Sura Edmond , Research Scientist I, Center for Healthcare Transformation

Sura Edmond advises clients on quality landscape developments, healthcare quality improvement, and performance measurement related to different therapeutic areas and clinical practices.

Penelope Solis , Research Scientist II

Penelope Solis supports clients through the design, implementation, and evaluation of data-driven solutions to support next-generation healthcare delivery.

This interview was originally published as a podcast. The audio is no longer available, but you can read the transcript below. For updates on our newly released content, visit our Insight Subscription page.


Angel: Hello and welcome to episode 10 part 3 in the Avalere Health Essential Voice series focused on the COVID-19 pandemic. Today’s episode will focus on provider performance-based payment incentives. My name is Angel Valladares, and I am a consultant in the Center for Healthcare Transformation at Avalere. I am joined today by Sura Edmonds and Penelope Solis, two of my colleagues who are also in the Center for Healthcare Transformation. We have had a couple discussions on this topic, in today’s episode we will discuss the impacts to payments. We have talked about performance and the patient implications and how that can translate to performance, but what about the impact of those implications on provider payment? Providers are participating in value-based programs and performance-based reporting programs, like the Merit-based Incentive Payment System (MIPS). To keep with the groups of providers that we have spoken about – cardiovascular care providers, diabetes care providers, primary care providers, and obstetrics and gynecology (OB/GYN) providers – all of these will likely have implications from impacts to performance on measures and the significant impacts of patient behaviors due to the COVID-19 pandemic itself and the social impacts. Penelope I will start with you, what are your thoughts about the overall repercussions to payment for the providers on focus on in cardiovascular disease (CVD) and diabetes?

Penelope: Thank you, Angel. I think one of the interesting things to highlight is that none of the measures that were developed, nor any of the programs that you mentioned, including MIPS, were formulated with the forethought to give credit for clinician care provided during a pandemic. So, to build on that, in previous discussions we have talked about how the pandemic has increased telemedicine use. However, due to the care events needed to meet and satisfy measures related to CVD or diabetes care, require lab test or diagnostic values to be assessed in order to determine what therapeutic changes may be necessary or to determine if the patient is in good control or poor control. There is an inability to perform these tests during the pandemic for these patients that would have otherwise gone in to see their physicians. What does this mean? For some clinicians, they will be able to report on some of those measures, if they have a large enough population that was able to go in to see them prior to the occurrence of the pandemic. However, if they select to report those measures, the data will be skewed since the benchmarking component will not reflect the total number of patients that would typically be seen by that provider, that practice, or generally across the United States. Alternatively, those clinicians will have to look and determine if they can leverage an existing performance measure to meet the MIPS reporting criteria. For some of these clinicians, they will be able to do this, for others they will not. But it will be interesting to see how that could potentially skew the data for certain metrics that typically have been hallmarks of the types of measures that would be reported by physicians treating patients with CVD or diabetes. Those are some of the implications that have transpired due to the pandemic. It is also creating a recognition by measure developers and payer organizations for metrics that are typically used to gauge intermediate outcomes such as control or ones that heavily rely on laboratory tests are not going to be fully functional during a crisis such as this.

Angel: Great Penelope, that was helpful. That feedback is important. Providers are certainly going to be impacted in different ways. At what point are providers going to be impacted by the low volume threshold? Knowing there is a minimum number of patients you must see and charges that you must post before you can qualify to participate in the MIPS. From your experience working at registries and professional societies in the CVD and diabetes space, what proportion of providers will be impacted by this? Also, how many patients traditionally are these providers caring for?

Penelope: That is a great question, Angel! I think they will meet the minimum threshold that is required for the measure. But the larger the patient population, from a clinician perspective, the more opportunities to track. In other words, because this has been going on for a number of months, and theoretically patients may be more hesitant to go into the physician’s office, – let’s say in an August or September timeframe – the total number of patients for that physician or practice is going to drop. Therefore, opportunities for improvement or to show a positive impact will be smaller. Going from seeing 200 patients to seeing 20 patients – while they may meet that threshold, the opportunity to create the robust data needed to benchmark and show practice performance compared to other practices is going to be strained.

Angel: That is very interesting! There are some similarities in the primary care space in terms of being able to compare. In a previous episode, we discussed the reduction in primary care patients in response to the pandemic with the elimination of elective procedures and closing of practices. Some of the impacts of those activities have already been reported with 40-60% of reduction of visits for outpatient visits, so it is very likely that the ability to serve these patient populations will have an impact on payment overall. As you mentioned earlier, patients with CVD and diabetes will likely see similar declines since we are seeing it across the board. I think it is interesting, and I appreciated your comment about the low-volume threshold, because what I was thinking about for primary care in particular, is some of the reduction in services may knock a few 100 clinicians and clinical practices out of eligibility for the MIPS program, unless they are in some sort of virtual group or cooperating cross-practice to report to the MIPS program.

For reference, and as a reminder, the low-volume threshold is the minimum participation criteria to be able to participate in the MIPS, and that is a minimum $90,000 in Medicare Part B services that are billed to the Centers for Medicare & Medicaid Services (CMS) and seeing greater than 200 patients in the measurement period. It must be both, rather than one or the other. This is important, because there were quite a number of providers who were on that threshold line. So, if we are seeing reduction in patient care across the board, quite a few providers will fall off. It will be up to them whether they do the extra work to participate and it is likely that the effort will not be valuable to providers. The recent payment adjustment was not a big incentive. Providers who achieved the maximum scores two years ago, remembering that payment is applied two years after that performance period, are just receiving those. So, if you reported your payments from 2018, that score is applied, and the payment adjustment is applied in 2020. For 2020, the positive payment adjustment was only 1.68% for excellent providers because it includes the monies that were allocated to reward and incentivize exceptional performance. Almost everyone received some adjustment. From the reports I have seen, 84% of MIPS providers scored at or above the exceptional performance threshold. The bar is low, and it requires a pool of poor performers to fund the monies that are allocated for the incentive. It may appear that providers are going to be impacted, but the impacts are going to be much larger on the reduction and reimbursement overall due to reduced Fee-for-Service, rather than any major impacts to the payment adjustment, given that the reduced pool of providers contributing. In addition, the performance reduction will likely happen across the board. What we will likely see is that the bar will drop for everyone and given the way the program works, the negative performers fund the positive performers who meet the exceptional performance threshold.

Given some of the discussion we had in the previous episode about what exceptions and flexibilities would look like from CMS, that will likely determine the extent in which we see any payment adjustments. Generally, with the MIPS it is possible that this pandemic will push more providers into the Advance Payment Model track. If you recall the Advance Payment Model provides 5% bonus payment for participation if you meet the minimum participation criteria. Given that many practices are closing, mergers are happening, and we are seeing more practice consolidation, we may see more providers incentivized to go into that direction since the reporting burden is significantly lower than it is in the MIPS program. It would be interesting to see how providers weigh the benefits and risks associated with switching over. Sura I am curious to see from your perspective how all of this relates to OB/GYN providers? And also, how OB/GYN providers will face unique payment impacts that are different from the providers we have talked about?

Sura: Okay, thank you Angel! In contrast, OB/GYN has a unique situation. As for Medicaid pay-for-performance examples, there was a survey put out by the Island Peer Review Organization (IPRO) that showed over half of state Medicaid programs operate on one or more pay-for-performance programs. The effort so far has been focused on pediatrics and women’s health. In April of 2020, American College of Obstetricians and Gynecologists (ACOG) published information for physicians on how to properly bill for digital and telehealth services, to ensure that providers are on the same page for how to navigate this new “normal” and track patient utilization moving forward. Interestingly, there are some specialties, including OB/GYN that have been asking for targeted and urgent relief payments from the federal government. And this is a result of feeling that these specialties, especially OB/GYN have been excluded from the distributions that have been aimed at alleviating the financial fallout that has resulted from the disruption of care due to COVID-19. These are just some of the unique situations to OB/GYN.

Angel: That is helpful. It showcases that across specialties there will be unique circumstances. For example, one provider area that will likely have contrasting financial circumstances is with End Stage Renal Disease (ESRD). This is a provider group that is chronically needed since this is a patient population with a long-term disease. And we know from the early data that there have been some impacts there and we will see what those outcomes will look like. ESRD providers and patients are in quite a few incentive programs, which will be an interesting area to explore in the future. For those tracking this area, certainly monitor it since there will be implications that affect different types of providers.

The Medicaid program is different from the Medicare program, but it is important to acknowledge that Medicaid providers are participating in pay-for-performance programs. Many of the states have programs that are specific to them and there is not a lot of attention put on Medicaid with regards to incentives. Some of the economic effects of COVID-19 include: over 40 million people laid off or reporting to unemployment, estimates of ~10 million people having lost their employer-sponsored healthcare coverage – most likely in states where Medicaid had been expanded, and many more anticipated patients will be signing up for Medicaid for the foreseeable future until the economy recovers, which could be a year or two. The Medicaid pay-for-performance programs will actually be much more important and receive much more attention at the state level, given that we are going to see states with a significantly higher number of enrollees and providers will be facing a larger proportion of patients with Medicaid. From a payment perspective this has implications since the Medicaid reimbursement rates are for the most part much lower than Medicare or private insurance. One other important aspect in terms of Medicare participation for specialty care and primary care providers specific to reduction in patient volume, and how that can translate to performance and ultimately payment is that due to patients waiting much longer to seek care, they will likely be much sicker or have much higher severity of illness than providers are accustomed to during a normal period. One of the implications is the outcome measures and some of the performance on outcomes. So, providers are either reporting those or through the components in the MIPS program that automatically look at outcomes via claims, it is likely that these providers will see positive or negative impacts on performance given that the pool of patients will have a higher severity of index and be much more sick than the general population. This will certainly depress their performance across outcome measure that are part of their evaluation for the MIPS payment adjustment.

Thank you, Penelope and Sura for joining me in today’s discussion. Your insights are invaluable to our listeners. Thank you all for tuning in today to Avalere Health Essential Voice. If you would like to learn more please visit to our COVID-19 Intel Center. Thanks everybody!

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