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Understanding MIPS Hardship Exemption 2023  

by | Jun 13, 2023

As a healthcare professional, the Merit-Based Incentive Payment System (MIPS) is a term you are all too familiar with. While the program is meant to encourage quality reporting and performance improvement, it can put excess strain on healthcare providers. That is where MIPS extreme and uncontrollable hardship exceptions come in — a way for eligible providers to be granted exemption from certain MIPS requirements. 

What is MIPS? 

The Merit-Based Incentive Payment System is a reporting program from the Centers for Medicare and Medicaid Services (CMS) that measures healthcare providers’ performance based on multiple quality measures. The primary goal of the MIPS program is to incentivize improvements in healthcare delivery and promote health outcomes that reduce wasteful spending. 

The 2023 MIPS hardship exception is a way for eligible healthcare providers unable to participate in MIPS to avoid receiving a negative payment adjustment. This exception applies to providers who have not submitted any MIPS data or submitted data that does not meet the required submission guidelines.  

The exception’s main purpose is to give eligible clinicians time to adjust to an ever-changing healthcare environment. Clinicians may face unforeseeable challenges, such as a natural disaster, the COVID-19 public health emergency, or unexpected vendor problems that interfere with their ability to participate in MIPS. Without proper preparation time, clinicians may face severe consequences, including financial penalties. The 2023 MIPS Hardship Exception aims to alleviate this potential burden. 

Participating in MIPS Hardship Exception Process 

The MIPS hardship exception offers relief to clinicians or clinician groups who may face significant barriers to participating in the MIPS program. However, eligibility and approval for the exception depend on meeting strict criteria and providing supporting evidence. 

Who is Eligible? 

The MIPS hardship exception is applicable to clinicians, clinician groups, and eligible clinicians who participate in a MIPS Alternative Payment Model, also known as APM entities, who meet any of the following criteria: 

  • Extreme and uncontrollable circumstances (EUC), such as a natural disaster or public health emergency (PHE) like the COVID-19 pandemic, significantly impact the clinician’s ability to provide patient care or submit data for MIPS final score. 
  • Lack of control or influence over the availability or functionality of certified electronic health record technology (CEHRT) for more than 90 consecutive days in the MIPS performance year, despite an effort to upgrade or obtain new CEHRT. 
  • Lack of control or influence over the availability or functionality of a qualified clinical data registry (QCDR) for more than 90 consecutive days in the MIPS performance year, despite an effort to obtain or maintain access to a QCDR. 

How to Apply 

The MIPS hardship exception application period usually opens on January 1 of the following MIPS performance year and closes on December 31 of the same year. Clinicians or groups must submit an application to the Centers for Medicare & Medicaid Services (CMS) explaining their hardship circumstances and providing evidence of eligibility and follow these steps: 

  1. Visit the CMS Quality Payment Program website and log in to their account 
  1. Select “Exceptions Applications” under the “Applications” tab 
  1. Select the hardship exception category that applies to the clinician or group 
  1. Provide a brief description of the hardship circumstances and the duration of the issue, as well as any supporting documentation, such as news articles or data from the provider’s electronic health record system 
  1. Review and submit the application 

What Happens After Applying for MIPS Hardship Exception? 

Upon receiving the hardship exception application, CMS reviews the application and determines eligibility. If approved, MIPS-eligible clinicians or groups will receive a neutral payment adjustment and will not be required to participate in the MIPS reporting program for the performance year. 

However, receiving a MIPS hardship exception in one performance year does not guarantee eligibility for future years. Clinicians or groups must reapply for a hardship exception each year they have reason to avoid penalties. Moreover, clinicians or groups that qualify for multiple hardship exception categories should apply for each category to increase approval chances.

Effects of MIPS Hardship Exception on Your Practice 

A MIPS hardship exception can have varying impacts on your medical practice, depending on the specific circumstance. For instance, if a practice were affected by a natural disaster, such as a hurricane or wildfire, it may be granted a hardship exception, which could result in a positive impact on their MIPS score.  

In contrast, if a practice experienced a significant reduction in patient volume or a major transition, such as a merger or acquisition, during the performance period, the resulting hardship exception could negatively impact the MIPS score. 

MIPS Payment Adjustments 

For eligible clinicians who do not apply for the MIPS hardship exception, failing to meet or exceed the performance threshold would result in a penalty fee. However, for those who successfully apply and are granted a hardship exception, there will not be any payment adjustments. As a result, the strain on smaller medical practices would be lessened. 

It is crucial to note that the application process for the MIPS hardship exception is specific and only applies to specific criteria. Eligible clinicians must provide sufficient evidence that supports their hardship and that it was beyond their control. A successful application depends on the credibility and accuracy of the information provided. 

MIPS Hardship Exemption for Interoperability 

The deadline to submit applications for interoperability exceptions in 2023 is 8 p.m. ET on January 2, 2024. According to CMS, hardship exceptions are available for the following reasons: 

  • You have decertified EHR technology 
  • You have insufficient internet connectivity 
  • You face extreme and uncontrollable circumstances such as a disaster, practice closure, severe financial distress, or vendor issues 
  • You lack control over the availability of CEHRT 

CMS also notes that lacking the required CEHRT does not qualify you for reweighting. 

Conclusion: MIPS Hardship Exemption 2023 

MIPS hardship exceptions are an essential measure for clinicians to maintain their revenue and ensure that they can continue to provide quality care to their patients, even during emergency situations. Additionally, the application of this exception may allow for better compliance with other CMS initiatives, such as value-based care, which increases the quality of care for their patients while reducing overall costs. 

Helping Providers Stay on Track with Hardship Exceptions 

Medical Advantage can help providers stay on the path that averts penalties and earns that positive payment adjustment, even in extreme circumstances. Our skilled consultants can provide a full practice assessment that will uncover every opportunity to ensure accurate reporting and improve performance among the MIPS’ categories. Additionally, Medical Advantage’s Accountable Care Organization (ACO) can provide a complete support system that helps practices earn top-performer status. Contact us today to learn more about how your practice can achieve MIPS success. 


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