Medicare Spending per Beneficiary (MSPB): Dexur Methodology, Calculations, and Importance

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Importance of MSPB and other VBP Measures

Dexur analyzes Medicare Claims data to evaluate MSPB cost per episode for hospitals. MSPB Hospital measure assesses the cost to Medicare for services performed by hospitals and other healthcare providers during an episode of care (episode), which is composed of the periods immediately prior to, during, and following a patient’s hospital stay. CMS stresses the importance of measuring the cost of care explicitly to recognize hospitals that are involved in the provision of high-quality care at a lower cost, in conjunction with other quality measures.

The Hospital VBP Program is designed to improve the quality, efficiency, and safety of care that patients receive during acute care inpatient stays, as well as to improve their experience of care during hospital stays. CMS evaluates hospital performance on an approved set of measures and dimensions grouped into four specific quality domains: clinical outcomes, efficiency and cost reduction, safety, and person and community engagement. Domains are assigned equal weights (percentages) of the Total Performance Score.

MSPB: Dexur Methodology

In order to calculate the Medicare spending per beneficiary for each hospital, we determined the following:

  1. The time frame, or length of the ‘‘spending per beneficiary episode’’ during which Medicare payments would be aggregated.
  2. The types of Medicare payments to be aggregated over this time frame.

MSPB Episode Length and Cost Calculations

Medicare Part A and B costs are measured from the 3 days prior to inpatient hospitalization, during inpatient hospitalization, and 30 days after discharge from the hospital. An acute care hospital admission triggers the MSPB Hospital measure episode. Episodes are considered only for beneficiaries who have enrolled in Medicare Part A and Part B for the period 90 days prior to the start of an episode (i.e., 93 days prior to the date of the index admission) until 30 days after discharge.


How Dexur’s MSPB calculations are different from CMS’?

Claim Types in each time period

Each time frame within the episode length constitutes costs which include inpatients, outpatients, skilled nursing facility, home health, hospice, durable medical equipment, prosthetics, orthotics, and supplies, and Medicare Part B Carrier (non-institutional Physician/Supplier) claims. The costs refer to total allowed amounts as defined in Medicare claims data, which include Medicare institutional costs and beneficiary payments; as long as the start of the claim falls within the episode window of 3 days prior to the index admission through 30 days post-hospital discharge.