Introduction
This document details the methodology for the Psychoses and Related Conditions measure and should be reviewed along with the Psychoses and Related Conditions Measure Codes List file, which contains the medical codes used in constructing the measure.
Measure Description
Episode-based cost measures represent the cost to Medicare for the items and services provided to a patient during an episode of care (“episode”). In all supplemental documentation, “cost” generally means the standardized1 Medicare allowed amount,2 and claims data from Medicare Parts A and B are used to construct the episode-based cost measures.
The Psychoses and Related Conditions episode-based cost measure evaluates a clinician’s risk-adjusted cost to Medicare for patients who receive inpatient treatment for psychoses or related conditions during the performance period. The measure score is the clinician’s riskadjusted cost for the episode group averaged across all episodes attributed to the clinician. This acute inpatient medical condition measure includes costs of services that are clinically related to the attributed clinician’s role in managing care during each episode the clinical event that opens, or “triggers,” the episode through 45 days after the trigger.
Measure Rationale
Psychotic disorders, including schizophrenia spectrum disorders, are associated with disturbances in thought processing and behaviors that result in a loss of contact with reality, and these disorders occur throughout the lifespan. A 2017 study found that Medicare patients being treated for psychotic disorders had both longer (1.52 days longer) and higher cost hospital stays compared to the mean hospital stay.3 The direct costs of treating schizophrenia in the US are estimated to range from $33 to $65 billion annually, with inpatient services and medication representing the largest proportion of the costs.4 Indirect costs also represent a large cost burden, costing an estimated $18.68 billion annually to community-dwelling US patients.5
The Psychoses and Related Conditions episode-based cost measure was recommended for development by an expert clinician committee—the Neuropsychiatric Disease Management Clinical Subcommittee—because of its high impact in terms of patient population and Medicare spending, and the opportunity for incentivizing cost-effective, high-quality clinical care in the mental health clinical area. Based on the initial recommendations from the Clinical Subcommittee, the subsequent measure-specific Psychoses and Related Conditions clinician expert workgroup provided extensive, detailed input on this measure. The workgroup, which was originally convened during Wave 2 of measure development and met several times throughout 2018 to provide input on the full measure specifications, was reconvened in October 20216 and April 2022 to discuss refinements to the measure.
Measure Numerator
The cost measure numerator is the sum of the ratio of observed to expected7 paymentstandardized cost to Medicare for all Psychoses and Related Conditions episodes attributed to a clinician. This sum is then multiplied by the national average observed episode cost to generate a dollar figure.
Measure Denominator
The cost measure denominator is the total number of episodes from the Psychoses and Related Conditions episode group attributed to a clinician.
Data Sources
The Psychoses and Related Conditions cost measure uses the following data sources:
- Medicare Part A and B claims data from the Common Working File (CWF)
- Enrollment Data Base (EDB)
- Long Term Care Minimum Data Set (LTC MDS)8
Care Settings
Methodologically, the Psychoses and Related Conditions cost measure can be triggered based on claims data from: acute inpatient (IP) hospitals and inpatient psychiatric facilities (IPF).
Cohort
The cohort for this cost measure consists of patients who are Medicare beneficiaries enrolled in Medicare fee-for-service and who receive inpatient treatment for psychoses or related conditions that triggers a Psychoses and Related Conditions episode.
The cohort for this cost measure is also further refined by the definition of the episode group and measure-specific exclusions (refer to Section 4).
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1 Claim payments are standardized to account for differences in Medicare payments for the same service(s) across Medicare providers. Payment standardized costs remove the effect of differences in Medicare payment among health care providers that are the result of differences in regional health care provider expenses measured by hospital wage indexes and geographic price cost indexes (GPCIs) or other payment adjustments such as those for teaching hospitals. For more information, please refer to the “CMS Part A and Part B Price (Payment) Standardization - Basics" and “CMS Part A and Part B Price (Payment) Standardization - Detailed Methods” documents posted on the CMS Price (Payment) Standardization Overview page. (https://resdac.org/articles/cms-price-payment-standardization-overview)
2 Cost is defined by allowed amounts on Medicare claims data, which include both Medicare trust fund payments and any applicable beneficiary deductible and coinsurance amounts.
3 Bessaha, Melissa L., Martha Shumway, Melissa Edmondson Smith, Charlotte L. Bright, and George J. Unick. "Predictors of Hospital Length and Cost of Stay in a National Sample of Adult Patients with Psychotic Disorders." Psychiatric Services (Washington, D.C.) 68, no. 6 (2017): 559-65.
4 Wilson, Leslie S., Gitlin, Matthew, Lightwood, Jim. "Schizophrenia Costs for Newly Diagnosed Versus Previously Diagnosed Patients." The American Journal of Pharmacy Benefits, vol. 3, no. 2, 2011, pp. 107- 115.
5 Desai, Pooja R., Kenneth A. Lawson, Jamie C. Barner, and Karen L. Rascati. "Estimating the Direct and Indirect Costs for Community-Dwelling Patients with Schizophrenia." Journal of Pharmaceutical Health Services Research 4, no. 4 (2013): 187-94.
6 “Summary of Psychoses/Related Conditions Workgroup Webinar,” QPP Cost Measure Information, Prior cost measure development and input (https://www.cms.gov/medicare/quality-payment-program/costmeasures/prior).
7 Expected costs refer to costs predicted by the risk adjustment model. For more information on expected costs and risk adjustment, please refer to Section 4.5.
8 For information on how LTC MDS data are used in risk adjustment, please refer to Section 4.5.