MIPS Payment Adjustments - How to Turn Compliance into Financial Gains | Electronic Health Record News

MIPS Payment Adjustments - How to Turn Compliance into Financial Gains

Tue Jan 6, 2026 by DrChrono Staff

The Medicare Merit-based Incentive Payment System (MIPS) is the largest value-based payment program in the United States, influencing reimbursement for nearly 1 million clinicians annually.

Still, providers find navigating the complexities of the MIPS challenging.

For practices that manage to align their reporting with MIPS requirements, the program offers not just regulatory compliance but also opportunities for significant economic gains.

So, how can your practice achieve these goals?

This blog will explore how MIPS payment adjustments work, their impact on practice finances, and strategies to maximize your MIPS scores and bonuses.

Understanding MIPS Payment Adjustments

MIPS is a value-based payment program introduced by CMS (Centers for Medicare & Medicaid Services) as part of the Quality Payment Program (QPP).

Its goal is to encourage providers to deliver high-quality, cost-effective care to patients.
MIPS directly ties a provider’s performance to Medicare reimbursement rates through MIPS payment adjustments.

Healthcare providers submit performance data across four categories:

Quality: Providers are assessed on the quality of their care.
Improvement Activities: Providers are evaluated on improving their practices.
Cost: Assessment of the cost-efficiency of the care provided.
Promoting Interoperability: Assess the use of certified electronic health record (EHR) technology to improve healthcare quality and patient safety.

Based on their performance, CMS uses a MIPS scoring system that determines whether they receive a positive payment adjustment (bonus), a negative adjustment (penalty), or remain neutral.

Who is eligible?

The Medicare Physician Fee Schedule (PFS) final ruling outlines CMS policies for eligible providers to participate in MIPS, including QPP policies for the 2026 performance year. While the final ruling introduces many changes, fundamental aspects of the MIPS reporting requirements will stay the same. Here are some key elements of the final rule:

The 75% data completeness criteria threshold will remain unchanged through the 2028 performance period/2030 MIPS payment year
A total of 190 quality measures for the 2026 performance period
The performance period will also include 5 new quality measures, substantive changes to 30 quality measures, and the removal of 10 quality measures

When are the MIPS Submission Deadlines?

The performance year begins on January 1 and ends on December 31 each year. Eligible providers must report data collected during the calendar year by March 31 of the following calendar year.

The payment adjustments are then applied to Medicare Part B reimbursements two years after the performance period.

Whether you’re a physician, medical biller, or part of a billing team, understanding the MIPS reporting requirements is critical. Why? Because it works.

A JAMA study revealed that nearly 80% of surgical healthcare professionals participating in the MIPS earned bonus payments in 2021, while just 2% received penalties.

Not only can MIPS participation boost practice revenue and increase Medicare reimbursements, but it also incentivizes high-quality care and promotes Interoperability.

Doctor has a bussinessmeeting

The Financial Impact of MIPS Compliance

MIPS isn’t just a system for tracking performance; it’s a mechanism that can radically impact your practice’s financial health.

MIPS impacts Medicare payments to eligible clinicians by applying a payment adjustment (either positive or negative) based on their performance across the four key performance areas listed above.

Through CMS payment adjustments, a healthcare provider’s Medicare reimbursement rates may be adjusted from -9% (penalty) to over +9% (bonus). This gap can make a substantial difference in the annual revenue of a practice that relies heavily on Medicare payments.

For providers scoring well in the MIPS scoring system, there are several benefits:

Positive adjustments enhance revenue streams and underscore your practice’s commitment to quality care.
Excelling at MIPS boosts a provider’s reputation, retaining current patients and attracting new ones.
Funds earned via MIPS reimbursement rates can be reinvested into technology, staff development, or patient services.

However, non-compliance or failure to meet MIPS reporting requirements can result in steep penalties, eroding valuable resources from your practice.

Unless you qualify for a MIPS exemption, the maximum MIPS penalty is -9%.

FROM ONE OF OUR PARTNERS: What Is MIPS? A Complete Guide for Healthcare Professionals

Leveraging MIPS for Practice Growth

When done right, providers can optimize MIPS incentives and maximize payment bonuses to fuel growth and innovation within their practices. Here’s how:

Reinvesting MIPS Adjustments

Here’s a scenario: a practice group with $1 million in annual Medicare billings earns a +5% adjustment due to strong performance in MIPS reporting requirements. This translates to an additional $50,000 in annual revenue, which can be reinvested into the practice.

This is just an example of how a practice can benefit from a MIPs adjustment, but the result is very real. Here are a few more ways favorable MIPS payment bonuses can elevate your practice:

Purchase new medical equipment.
Invest in more in-depth staff training or certifications.
Improve your organization to enhance the patient experience.
Create community outreach programs.

Marketing MIPS Success

Did you know that excelling at MIPS can boost your reputation? Before we share how, a little background first.

In 2020, CMS began publishing MIPS performance scores and consolidated these results under one Medicare Care Compare tool. Since then, MIPS has published each provider’s final score within 12 months following the performance year.

This allows patients to see their practitioners rated on a 100-point scale and learn how they compare to other providers.

This publication is a perfect way to showcase your performance to attract new patients, build trust, and stand out in a competitive marketplace.

Here’s how:

Share success with patients and referral networks through your website, newsletters, podcasts, or social media.
Highlight awards or certifications earned under the MIPS scoring system.
Illustrate your dedication to high-quality care during patient consultations.
Showcase improvements in areas like patient satisfaction, reduced readmission rates, or improved health outcomes.
Develop case studies demonstrating how MIPS participation has improved patient outcomes.

Women workign with laptop

Strategies for Maximizing MIPS Scores

Meeting MIPS reporting requirements is often easier said than done, especially for small to medium-sized healthcare practices.

That said, strategic planning can significantly improve your chances of achieving positive payment adjustments. Here’s how:

Strengthen Promoting Interoperability

One of the most critical categories of MIPS is Promoting Interoperability, which directly connects to your EHR. The CMS offers a Promoting Interoperability Program that provides incentives for EHRs that meet MIPS program requirements.

To be successful in this category, your EHR must be certified and capable of exchanging health information with other systems.

For example, the cloud-based DrChrono EHR is certified as a Complete EHR and meets MU standards. In other words, providers can use this EHR in their practice to qualify for government incentives.

Here are additional steps to promote strong interoperability in your practice:

Check if your current EHR is compliant with MIPS standards. Go to the CMS Qualified Payment Program website, use the “Participation Lookup” tool, and enter your NPI to see if your system is listed on the Certified Health IT Product List (CHPL).
Utilize open APIs to facilitate seamless communication and data exchange between different systems.
Standardize data formats using recognized measures like FHIR (Fast Healthcare Interoperability Resources) and HL7 (Health Level Seven).

Elevate Quality and Cost Performance

Utilize preventative care initiatives and advanced technology to boost MIPS Cost and Quality scores and improve practice management workflows. Here’s how:

Automate tasks like appointment scheduling, medical billing, and prescription management. This allows providers to focus more on patients and less on paperwork, saving time and money.
Leverage performance-tracking solutions to monitor quality metrics consistently. For example, with features like real-time data tracking and auto-generation of reports, DrChrono EHR can boost MIPS compliance. These measures ensure that providers consistently meet requirements.
Participate in preventive care programs that improve patient health while reducing long-term costs.
Track cost data and identify areas for improvement.

Excel in Improvement Activities and Monitor Score

To boost your MIPS Improvement Activities score, choose measures that align with your practice’s needs.

For example, use a clinical decision support system (CDSS) or adopt a prescription drug monitoring program (PDMP). These activities can improve patient care and safety. Other tips include:

Engage in patient education, which qualifies as an improvement activity under MIPS.
Participate in local community health initiatives or collaborations with other healthcare providers.
Regularly review feedback from CMS on your MIPS performance scores and identify areas for improvement.

For providers, MIPS payment adjustments can feel daunting, but they also present a clear opportunity for financial and professional growth.

By mastering MIPS reporting requirements, improving performance across categories, and leveraging incentives strategically, you can transform compliance into a significant competitive advantage.

Ready to streamline your MIPS reporting and maximize your score?

Contact DrChrono today to learn how our EHR solutions can turn MIPS compliance into value-based patient care and significant financial gains.