MIPS Payment Track:

Cost Performance Category

Learn the Basics

Get the Making Sense of MACRA: Supplements Bundle to learn the basics of QPP. This downloadable resource features information about the law and reporting requirements for the MIPS track.

Free for Members!

Not a member?

Take Action in MIPS

Learn how to Pick Your Pace, select and report quality measures, and more, with Making Sense of MACRA: MIPS Playbook, a step-by-step, downloadable guide.

Free for Members!

Not a member?

MIPS: Explaining the Cost Performance Category

The Medicare Access and CHIP Reauthorization Act (MACRA) was passed and signed into law in April 2015. Under MACRA, eligible clinicians (ECs) will participate in either the Merit-based Incentive Payment System (MIPS) or an Advanced Alternative Payment Model (AAPM). MIPS and AAPMs are collectively referred to as the Quality Payment Program (QPP).

With the MIPS track, ECs receive a final score based on performance in four performance categories: quality, cost, advancing care information (ACI), and improvement activities.

To give ECs more time to learn about and adjust to QPP, the Centers for Medicare & Medicaid Services (CMS) deemed 2017 a transition year to “Pick Your Pace.”

Cost Reporting

As part of Pick Your Pace, the cost performance category will not be scored for the 2017 performance period. However, clinicians will receive feedback on their cost performance.

The cost category will be weighted at 10% of a clinician’s final score under MIPS for the 2018 performance period, and 30% for the 2019 performance period and beyond.

There is no data submission required for the cost category. CMS will calculate cost measures of a clinician’s performance using claims data.

Beginning in 2018, clinicians will be assessed on their performance in:

  • Medicare spending per beneficiary (MSPB)
  • Total per capita costs
  • Condition and treatment episode-based measures

The MSPB and total per capita cost measures were included in the Value-Modifier calculation. In addition, physicians have been provided with feedback on the episode-based measures through the supplemental Quality and Resource Use Report (sQRUR).

The MSPB measure assesses Medicare Part A and B costs incurred during an episode. An episode includes the dates falling between three days prior to an Inpatient Prospective Payment System (IPPS) hospital admission (referred to as an index admission) and 30 days post-hospital discharge. The MSPB measure evaluates the observed cost of episodes compared to their expected costs. For the MSPB measure:

  • Clinicians who do not see patients in the hospital will not be attributed to any episodes and not scored on the measure.
  • Clinicians must be attributed to at least 35 cases to be scored on this measure.
  • Episodes will be attributed to the clinician who provided the plurality of Medicare Part B services to a beneficiary during an index admission.

The total per capita cost measure assesses all Medicare Part A and B costs for each attributed beneficiary. For the total per capita cost measure:

  • Clinicians must be attributed to at least 20 unique beneficiaries to be scored on this measure.
  • Attribution uses a two-step process:
    • 1) A beneficiary is attributed to a tax identification number (TIN) if the beneficiary received more primary care services from primary care physicians, nurse practitioners, physician assistants, clinical nurse specialists within that TIN than from clinicians in any other TIN.
    • 2) If a beneficiary cannot be attributed to a TIN using the first step, the beneficiary will be attributed to a TIN if they received more primary care services from specialist physicians within a TIN than from clinicians in any other TIN.

Click the magnifying glass at the top left of the image to enlarge.

There are 10 episode-based measures, most of which are triggered by an inpatient stay or by procedure current procedural terminology (CPT) codes.

  • Many of the episode measures will not apply to clinicians who only practice in an ambulatory care setting.
  • Clinicians must be assigned a minimum of 20 cases to be scored on these measures.
  • One measure that may apply to family physicians is “colonoscopy and biopsy.”
  • The episode-based measures each have different attribution methodologies, depending on the type of measure.

Cost measures are risk-adjusted to account for differences in patient characteristics, such as multiple chronic conditions that may affect a clinician’s performance on the measure.

Cost measure benchmarks are established using data from the performance period and not the historical two-year look-back period.

  • A measure will be benchmarked if it has 20 groups or individual clinicians who can be attributed to the case minimum for the measure.
  • A measure without a benchmark will not be scored or included in the performance category score.

An EC’s performance will be compared to the measure benchmark and assigned 1 to 10 points.

The cost performance category score is the average of all scored cost measures.

When reporting as a group, CMS will aggregate the scores of individual clinicians within the TIN.

  • For example, a TIN may have one clinician with 10 attributed cases and another with 12 attributed cases. If they are reporting as individuals, they would not be scored on the measure. However, if they were reporting as a group, they would receive a score since they reach the 20-case minimum threshold (10 cases + 12 cases = 22 cases).

Beginning in 2018, if an individual or group does not receive a cost score, the weight for the cost category will be redistributed to the quality category.