The MIPS Cost category plays a significant role in determining your overall Merit-based Incentive Payment System (MIPS) score. Unlike other categories, cost performance is automatically calculated based on Medicare claims, meaning providers cannot submit cost data manually.
Cost is weighted at 30% of your total MIPS score, making it essential to deliver care efficiently. CMS evaluates cost through various measures, such as total per capita cost (TPCC) and Medicare spending per beneficiary (MSPB).
Many providers struggle with controlling costs while maintaining quality care. Cost efficiency does not mean cutting necessary services; instead, it focuses on reducing unnecessary billing and optimizing patient care workflows.
Related: MIPS Essentials: What Healthcare Professionals Must Know
Key MIPS Cost Measures
Understanding the specific cost measures used in MIPS reporting is essential for improving performance. Each measure evaluates different aspects of CMS expenditures for types of providers, patient conditions, episodes of care, and etc.
By identifying where your practice incurs the highest costs, you can implement strategies to optimize spending while maintaining high-quality care. The following example cost measures provide a structured approach to assessing financial efficiency in MIPS.
Total Per Capita Cost (TPCC)
TPCC measures overall CMS spending per Medicare beneficiary under a provider’s care. It considers inpatient, outpatient, and post-acute care services. Lowering unnecessary hospital visits and optimizing follow-up care helps reduce TPCC scores.
A strong focus on preventative care and chronic disease management can also help lower per capita costs. By addressing health concerns early, providers can minimize the need for expensive hospitalizations and emergency interventions.
Medicare Spending Per Beneficiary (MSPB)
MSPB tracks spending during an episode of care focusing on hospital stays and post-discharge services. Providers who focus on reducing readmissions and improving care coordination can improve their MSPB performance.
One effective way to manage MSPB costs is by implementing discharge planning and follow-up programs. Ensuring that patients have proper post-hospitalization care, such as medication management and specialist referrals, can prevent costly complications and unnecessary readmissions.
Episode-Based Cost Measures
These measures evaluate spending for specific medical conditions or procedures, such as joint replacements or cardiac procedures. Managing episode-based care efficiently helps providers control costs while maintaining high-quality outcomes.
Providers can reduce episode-based costs by utilizing evidence-based treatment guidelines and standardizing care pathways. Streamlining processes across different providers ensures that patients receive consistent, cost-effective care, reducing variations that contribute to excess spending.
Strategies to Improve Your MIPS Cost Score
Improving your MIPS cost score requires a combination of strategic care management, financial efficiency, and technology-driven solutions. Since cost is calculated using claims data, proactive decision-making is key to achieving better performance.
Providers must focus on reducing unnecessary billing while maintaining high-quality care, ensuring that their cost scores reflect efficient patient management.
By identifying areas of high spending, optimizing care coordination, and utilizing data analytics, providers can make informed changes that enhance cost efficiency. The following strategies outline effective ways to control costs and improve overall MIPS performance.
Improve Care Coordination
Effective communication between primary care providers, specialists, and hospitals reduces unnecessary tests, duplicate treatments, and readmissions. Encouraging better patient follow-ups and seamless transitions between care settings leads to lower costs.
Reduce Unnecessary Services
Ordering only necessary tests and procedures helps cut costs without compromising care quality. Reviewing patient histories before ordering imaging or lab tests prevents redundant diagnostics and minimizes Medicare spending.
Optimize Post-Acute Care Management
Proper post-acute care planning reduces readmissions and excess spending. Coordinating with skilled nursing facilities, home health agencies, and rehabilitation centers ensures patients receive the right care at the right time.
Related: MIPS Data Completeness Requirements
Using Technology to Reduce Costs
Technology plays a crucial role in optimizing cost efficiency in MIPS reporting. By leveraging digital tools, providers can identify billing patterns, streamline workflows, and improve patient outcomes.
Implementing data-driven solutions helps reduce unnecessary expenses while maintaining high-quality care. The following strategies highlight how technology can support cost reduction efforts.
Implement Data Analytics Tools
Analytics platforms help providers track spending patterns and identify areas for improvement. Reviewing claims billing reports regularly can highlight high-expense areas and allow for timely interventions.
Leverage EHR Integration
Integrating electronic health records (EHRs) improves data sharing between providers, reducing unnecessary tests and ensuring efficient care coordination. EHRs also facilitate clinical guidelines-based treatment plans, improving patient outcomes and reducing unwarranted practice variation.
Automate Patient Outreach
Automated systems for follow-up appointments, medication reminders, and chronic disease management help reduce costly emergency visits and hospitalizations.
Understanding MIPS Reporting and Scoring
What Is MIPS Reporting?
MIPS reporting evaluates provider performance across four categories for quality, cost, improvement activities, and promoting interoperability. Providers must ensure compliance with MIPS reporting to maximize their scores.
How MIPS Scoring Works
CMS assigns a weighted score to each category, with cost contributing 30% to the total score. Providers can review MIPS scoring guidelines to understand how each measure impacts their final reimbursement.
Meeting MIPS Requirements
Providers must stay updated with MIPS requirements to ensure compliance. Failing to meet reporting requirements or cost efficiency benchmarks can result in negative payment adjustments.
Leveraging Patient360 to Improve Cost Performance
Achieving Excellence with MIPS
Partnering with a trusted MIPS support provider helps streamline cost-related data collection. With achieving excellence with MIPS, providers can access expert guidance on understanding CMS cost measures as a basis for care efficiency improvement efforts .
Understanding MIPS Basics
For those new to the system, learning what is MIPS provides foundational knowledge on reporting requirements, cost measures, and compliance strategies.
Optimizing MIPS Scores
Focusing on strategic reporting and cost management is essential for success. Optimize MIPS scoring by using analytics tools, performance tracking, and proactive reporting approaches.
For expert assistance in improving your MIPS cost score, visit Patient360. Gain access to tools, reporting support, and strategic guidance to enhance your MIPS performance today.
Conclusion
Managing MIPS cost performance is critical to improving reimbursement and avoiding penalties. Providers must focus on care coordination, post-acute care management, and technology-driven efficiency to reduce spending while maintaining high-quality care.
By using data analytics, automated outreach, and EHR integration, providers can track billing patterns and optimize cost efficiency. Reviewing MIPS scoring criteria and reporting guidelines helps ensure compliance and maximizes financial incentives.
