Physician Quality Reporting System (PQRS)

Physician Quality Reporting System (PQRS)

About PQRS

The Physician Quality Reporting System (PQRS) is a federal program administered by the Centers for Medicare & Medicaid Services (CMS) that uses Medicare payment adjustments to promote quality measure reporting among eligible health care professionals providing outpatient services to Medicare beneficiaries. The program was first implemented in CY 2007 for physician and non-physician providers pursuant to the Tax Relief and Health Care Act of 2006, and was made permanent with passage of the Medicare Improvement for Patients and Providers Act of 2008.

The payment adjustments take the form of incentives and disincentives based on a fraction of Medicare Part B physician fee schedule charges for covered professional services (0.5%-2%). The program initially involved payment incentives for eligible professionals to satisfactorily report data on certain quality measures, but only disincentives have been in place since 2013. The payment adjustments are based on a 2-year cycle, however, meaning in CY 2014 (this year) incentives will be paid based on satisfactory reporting in CY 2012.  But in CY 2015 (next year), eligible professionals who did not satisfactorily report data for CY 2013 will face Medicare negative payment adjustments of 1.5%. Eligible occupational therapists must therefore meet their PQRS reporting obligations this year in order to avoid payment cuts of 2% in CY 2016.


PQRS Incentives & Disincentives (based on a 2-year cycle)


+0.5% (based on 2011 reporting)
[performance year for 2015 penalty]


+0.5% (based on 2012 reporting)
[performance year for 2016 penalty]


-1.5% (based on 2013 reporting)


-2% (based on 2014 reporting)

. . .

See future rulemaking

PQRS reporting is entirely different from G-code functional data reporting on outpatient claims, and is only a small part of a much broader CMS effort to advance health care quality and to purchase services based on value rather than volume.


Occupational therapists who (1) are independent practitioners or who work in private practice, and (2) bill Medicare using an individual-level National Provider Identifier (NPI) are subject to PQRS. Occupational therapists working in hospitals or skilled nursing facilities whose employers bill for their services are not subject to the program rules because these clinicians do not bill for the services they provide through their own NPI.

AOTA Guide to PQRS
CMS Overview Fact Sheet on PQRS