The Chiefs looked on course for a narrow victory but Bath replacement fly-half Tom Heathcote converted a penalty try three minutes from time to ensure the spoils were shared.
"Whenever a team peg you back that late in the game, specifically when you have quite good control of things, it feels tough," said Baxter.
"But there is a reality, I don't think we played well enough in the first half and I don't think our forwards were right on the money.
"That changed pretty dramatically in the second half and ultimately they gave us the control to really pull away. Then we kind of did what we did in the first half, which was double-up a couple of errors and a couple of penalties.
"All of a sudden we were defending in the corner and the penalty try happens and the game has gone from you. That is a little frustrating but this is the best result that we have had against Bath and it shows that we are getting a lot of things right.
"We are still unbeaten at home in the Premiership and we are still collecting points as we need to. We are in the top half of the league which is where we want to be."
Bath first-team coach Toby Booth said: "The resilience and bounce-back from last week (defeat to Saracens) was really important because it is a test of character. It is that character that gets you through the dark months and gets through to the other side.
"There was a bump in the road last week and we knew this game would be a massive test of character and we have come through that test."
