MIPS 2020 Final Rule: Cost Category

The Cost category for the Merit-based Incentive Payment System (MIPS) reporting seems to be the most confusing, with questions coming from practices throughout the year. The questions will continue as the Centers for Medicare and Medicaid Services (CMS) made the most changes to this category for the 2020 Final Rule.

CMS did keep the Cost category weight of the total performance score at 15 percent instead of the proposed 20 percent, but the category will reweight to 30 percent for the 2022 performance year, as MACRA law mandates that percentage by that year.

Total Per Capita Cost (TPCC)

TPCC has been around for years as part of the Value Modifier program and previously looked at the total allowed charges for a Part B beneficiary during a performance year (January 1 – December 31). All costs would be attributed to one clinician or physician group tax ID number (TIN) but also include the cost of Medicare billed by other tax ID numbers of clinicians or facilities who may have seen the patient during that same year. To update the measure, CMS has decided to segment the performance year into 13 four-week periods called “beneficiary months.”  As far as attribution is concerned, CMS will look at the beneficiary month to see which TIN billed an E&M service and a general primary care service or a second E&M service code. Clinicians would have to see the patient at least twice during one of those four-week periods to be attributed the cost during that time.

CMS will also exclude clinicians who are unlikely to be responsible for primary care services, including certain surgeons or specialists. CMS will make this determination based on the Health Care Finance Administration (HCFA)  specialty used on the Part B claims assigned by the Medicare Administrative Contractors (MACs) when processing claims payment. There is a downloadable file  of what specialties this could apply to at: https://qpp.cms.gov/about/resource-library. Search 2020 Cost Measure Code Lists.

Medicare Spending Per Beneficiary, now called Medicare Spending Per Beneficiary – Clinician (MSPB-C)

In the past, this measure was focused only at the TIN level, but now CMS will also asses this measure at the individual clinician level (which is a combination of the TIN and the clinician NPI number).

The methodology is also being updated to attribute the cost of an inpatient Episode of Care by either medical episode or surgical episode – looking at the actual patient situation. Medical episodes will be attributed to any TIN billing at least 30 percent of the E&M codes during an inpatient stay. As an example, if a physician in your practice billed an E&M code for a patient during an inpatient stay, your TIN would only be attributed the medical episode if that E&M service made up at least 30 percent of the E&Ms billed by an TIN during the patient’s inpatient stay. So, if the patient had four E&M visits by four different TINs, the medical episode would not be attributed to your TIN (E&M is only 25 percent). But if the E&M your TIN billed was only one of two, you would be attributed the medical episode (E&M is 50 percent). Surgical episodes will be attributed to the TIN or TIN-NPI of the surgeon performing the main procedure.

Also, new exclusions apply to this measure, such as unrelated services that are specific to groups of Diagnosis-Related Groups that are aggregated by Major Diagnostic Category. For example, the exclusion of an orthopedic procedure for episodes that are triggered by a diagnosis-related groups under disorders of the gastrointestinal system coding. In addition, CMS will exclude any hospice costs incurred during the inpatient stay.

New Episode-Based Measures for Cost

Some of the new Episode-Based measures will apply to specialty practices, if they meet the case minimum.


For 2020 MIPS reporting, CMS will calculate your score for the Cost category based on submitted claims over a 12-month performance period, including any Cost measures where the case minimums are met:

  • Total per Capita Cost (TPCC)
  • Medicare Spending per Beneficiary – Clinician (MSPB-C)
  • 20 Episode-Based Measures

Information for this article was taken from the MIPS 2020 Final Rule webinar presented in January by the Quality Reporting Engagement Group. The team is ready to assist with all your MIPS needs, from submission assistance for 2019 reporting to a full-service consulting partnership for 2020. Contact them at sales@intrinsiq.com.

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