MIPS 2026: How to Avoid the 9% Medicare Penalty

Step 1: Determine Whether You Are Subject to MIPS

Not every clinician who sees Medicare patients is subject to MIPS. CMS excludes clinicians who fall below the low-volume threshold, which for 2026 is defined as: billing less than $90,000 in Medicare Part B allowed charges, OR seeing fewer than 200 Medicare Part B beneficiaries, OR furnishing fewer than 200 covered professional services during the determination period.

The determination period for 2026 is the 12-month period ending September 30, 2025 (the prior year determination period). CMS uses this data to send preliminary determination notifications in spring 2026. If you did not receive a notification and are unsure of your status, check QPP.cms.gov using your individual NPI or group TIN.

Clinicians in their first year of Medicare Part B participation are also excluded. Additionally, if you are already participating in an Advanced APM that qualifies for the QP threshold, you receive the APM Incentive Payment instead of MIPS scoring and are excluded from MIPS.

Step 2: Understand the Four Performance Categories

MIPS scoring in 2026 uses four performance categories. The final MIPS score is a weighted composite of your performance in each:

• Quality (30% weight): Performance on at least 6 quality measures, including at least 1 outcome or high-priority measure
• Cost (30% weight): CMS calculates this from your claims data automatically — no reporting required, but you cannot opt out
• Promoting Interoperability / PI (25% weight): EHR meaningful use criteria; 180-day minimum reporting period
• Improvement Activities / IA (15% weight): Document 40 points worth of activities completed during the performance year

The performance threshold for 2026 (the score below which penalties apply) has not been finalized at time of writing, but based on CMS's trend since 2022, the threshold is expected to be in the 75-point range. Scores above the performance threshold receive positive adjustments; scores at the exceptional performance threshold (top quartile) receive additional bonus payments.

Step 3: Choose Your Six Quality Measures Strategically

The Quality category is where practices have the most control and where strategic measure selection makes the largest difference. You report on at least 6 measures from the MIPS measure set, and your score is based on how your performance rates compare to national benchmarks.

The scoring model is: your performance rate on a measure is compared to the national benchmark for that measure, which produces a decile ranking (1-10), which maps to a point value (3-10 points). A measure where you perform in the 10th decile (top 10% nationally) earns 10 points. Performing below the minimum threshold earns 1-3 points.

The strategic implication: choose measures where your actual performance is high relative to the benchmark. This requires knowing your own performance data before the start of the performance year. A practice that performs well on diabetic hemoglobin A1c control should select that measure. A practice with poor cancer screening rates should avoid screening measures they can't improve within the year.

You must also include at least one outcome measure or, if no outcome measure applies to your practice type, at least one high-priority measure (appropriate use, patient safety, efficiency, or patient experience). Failing to include an outcome or high-priority measure does not automatically reduce your score to zero, but it limits the maximum Quality points available and is noted in your feedback report.

Step 4: The Cost Category (You Can't Opt Out, But You Can Improve)

The Cost category is calculated entirely from Medicare claims data. CMS applies episode-based cost measures and the Medicare Spending Per Beneficiary (MSPB) measure to your attributed patients and compares your costs to risk-adjusted national benchmarks. You do not submit anything for Cost — it happens automatically.

The practical implication is that you cannot improve your Cost score through documentation alone. You can improve it by reducing unnecessary resource use: avoiding low-value imaging for conditions where imaging changes management rarely, reducing unnecessary 30-day readmissions (which add significant cost to the episode), and improving discharge planning to avoid post-acute care overutilization. These are clinically appropriate interventions that happen to also improve your MIPS score.

If you received a negative Cost adjustment in a prior MIPS performance year, the CMS feedback report (available on QPP.cms.gov after results are published) specifies which cost measures drove the penalty and provides attribution-level data. This is the starting point for improvement planning.

Step 5: Promoting Interoperability — Base Score Plus Bonus

PI scoring in 2026 has a base score of 90 points possible (85 required for the base score in most cases) plus bonus opportunities. The base score requires: completing the Health Information Exchange objectives, e-prescribing, the Prevention of Information Blocking Attestation, the ONC Direct Review Attestation, and the Security Risk Analysis.

Most practices on a certified EHR can meet the base PI requirements without significant additional work. The risk areas: practices that switched EHR platforms mid-year may have gaps in their 180-day reporting period; practices using a certified EHR that was decertified during 2026 have specific hardship exemption processes available.

PI hardship exemptions are available for small practices (15 or fewer clinicians), practices in health professional shortage areas, and practices facing demonstrated extreme and uncontrollable circumstances. Hardship exemptions must be applied for through QPP.cms.gov before the submission deadline.

Step 6: Improvement Activities — 40 Points, Strategically Selected

The IA category requires 40 total points of documented improvement activities. Activities are categorized as High Weight (20 points each) and Medium Weight (10 points each). You need 2 High Weight activities, 4 Medium Weight activities, or any combination totaling 40 points.

Common Mistakes That Lead to Penalties

Not submitting at all. CMS assigns an automatic -9% MIPS penalty to any clinician subject to MIPS who does not submit. This is the most common cause of penalties and the most easily avoidable. If you are subject to MIPS and submit even a minimal dataset — one quality measure, the PI attestation — you avoid the worst-case outcome.

Submitting too few measures. Submitting fewer than 6 quality measures (when submitting as an individual) means CMS applies a zero to the missing measure slots. This significantly depresses your Quality score.

Missing the outcome measure requirement. Not including an outcome or high-priority measure is a common oversight that can reduce your Quality score by limiting the maximum points available.

Late submission. The March 31, 2027 deadline is hard. CMS does not grant extensions for late submissions except in declared public health emergencies. The 90-day window prior to the deadline — January through March 2027 — is when most submission errors are discovered and corrected. Plan your submission workflow to have data reviewed by February 15.

How Vizier Tracks Your 2026 MIPS Score in Real Time

Vizier connects to your EHR data exports and calculates your MIPS score continuously through the 2026 performance year. You can see your projected Quality score by measure, your PI attestation status, your documented IA activities, and your estimated final composite score — at any point during the year, not just at submission time.

This matters because MIPS is not a year-end exercise. The quality measures that will determine your score are being calculated every week on your current patient encounters. A practice that checks their MIPS score in October has two months to improve their performance rates on gap measures. A practice that first looks at their score in February 2027 has missed the opportunity entirely.

The submission timeline is fixed. Your performance window is the entire calendar year. Track it accordingly.