Tiered pricing buckets every transaction into one of three categories: qualified (lowest rate, advertised), mid-qualified, and non-qualified (highest rate, often advertised in fine print). The processor decides which tier each transaction falls into — and the criteria are deliberately opaque.
In practice, most rewards cards, business cards, keyed-in transactions, card-not-present transactions, and any transaction with even a small irregularity gets bumped to mid-qualified or non-qualified. A merchant whose advertised rate is 1.79% (qualified) often sees an effective rate of 3.0%+ because the bulk of their volume is non-qualified.
What to do: switch off tiered pricing entirely. Interchange-plus shows the actual cost of each card type instead of hiding it inside arbitrary tiers.