MIPS Reform Proposed in Congress, Addressing Penalty Concerns
By Phil West

A physician in Congress is offering bipartisan legislation that organized medicine says would bring much-needed reform to the Merit-Based Incentive Payment System (MIPS) – especially for the smaller, independent practices disadvantaged by its financial unpredictability and administrative work.

U.S. Rep. Mariannette Miller-Meeks, MD (R-Iowa), introduced H.R. 8622, the “Medicare Physician Data-driven Performance Payment System Act of 2026,” seeking to retool several concerning elements of the performance-based MIPS payment model within the Quality Payment Program.

The American Medical Association’s May 22 letter backing the bill highlights its removal of MIPS’ system of choosing winners and losers, imposing negative payment adjustments of up to 9% on participants who score lower across the program’s four performance measurement categories: quality, cost, improvement activities, and promoting interoperability. The Texas Medical Association has joined AMA in supporting the proposal.

“MIPS, as currently structured, imposes steep and disproportionate penalties on the very practices least able to absorb them,” AMA wrote. “Nearly 50% of solo eligible clinicians, 29% of small practices, and 18% of rural practices received a MIPS penalty in 2023, the most recent year for which these data are available. MIPS compliance costs approximately $12,800 and requires 202 hours per physician annually, yet research shows that MIPS scores are approximately as effective as chance in identifying high versus low-quality performance.”

H.R. 8622 would replace the current bonus and penalty structure with the Data-Driven Performance Payment System (DDPS), tying performance to a portion of a physician’s annual payment update, with all participants getting positive payment updates within a range based on how they score.

TMA staff explain this new system as proposed could be beneficial because it would:

• Create a more predictable incentive structure;
• Align quality participation with positive payment updates instead of punishment; and

Acknowledge inflationary pressures in physician practice costs.

The bill would also freeze the MIPS performance threshold – the minimum score a participant needs to avoid a payment penalty – at 75 points through 2033. AMA says that move would provide stability and greater predictability during the transition to DDPS.

The legislation also calls for the Centers for Medicare & Medicaid Services (CMS) to provide participants quarterly performance feedback and prevents the agency from penalizing participants who do not receive sufficient performance data.

H.R. 8622 also proposes reinvesting funds not paid out as bonuses into an improvement fund, earmarked for what AMA identified in its letter as “small, rural, safety net, and other under-resourced practices, directing resources back to the practices that need them most, helping them to overcome barriers, modernize and innovate patient care, and advance towards innovative value-based payment models.”  

Lindsay Botsford, MD, former chair of TMA’s Council on Health Care Quality, sees how H.R. 8622 would make MIPS better for its participating physicians.

“There have been problems [with MIPS] since the start … and then over time we've seen it play out … especially for independent and small practices,” she said.

However, she cautions the bill still lacks one of organized medicine’s priorities to help practices keep up with costs and stay viable: tying physician payment updates to the Medicare Economic Index that CMS uses to measure practice inflation costs.

“The underlying problem is that Medicare payments have not increased and even kept pace with inflation, and so when you layer on penalties or additional burden on top of that fundamental flaw … that's where the insult starts to multiply,” she said.