Insurance Circular Letter No. 18 (1988): Reimbursement for Hospital Inpatient Services Under No-Fault for Treatment Rendered on and After January 1, 1988 - WITHDRAWN

August 30, 1988

SUBJECT: INSURANCE

Circular Letter No. 18 (1988)

WITHDRAWN

TO: AUTOMOBILE SELF-INSURERS & INSURERS LICENSED TO WRITE AUTOMOBILE INSURANCE IN NEW YORK

RE: REIMBURSEMENT FOR HOSPITAL INPATIENT SERVICES UNDER NO-FAULT FOR TREATMENT RENDERED ON AND AFTER JANUARY 1, 1988

This Circular Letter supplements Circular Letter No. 11 (1988), and is designed to provide guidance respecting the relatively complicated procedures that automobile no-fault payers must understand in reimbursing hospitals for inpatient services under the new DRG (Diagnosis-Related Group) system, which became effective. January 1, 1988 in New York pursuant to Chapter 2 of the Laws of 1988; Hospital reimbursement for outpatient services remains subject to fee schedules issued by this Department by periodic. Circular Letter.

The DRG system establishes a reimbursement methodology dramatically different and more difficult than that previously in force for no-fault payors. Under the new law, a no-fault payor must reimburse the appropriate DRG amount, regardless of the hospital's billed charges. How a no-fault payor verifies a hospital's DRG billing is quite complex and can be confusing, however.

Therefore, several sample calculations and rate schedules accompany this Circular Letter, to help you understand the DRG system in practice and to assist your, claims personnel in making appropriate and timely DRG payments:

Schedule

Attachment

** 1988 Workers' Compensation/

No-Fault Case Payment Rates

** 1988 Workers' Compensation/

No-Fault Exempt Hospital/Unit Rates

** 1988 Workers' Compensation No/Fault ALC Rates

** Short Stay and Transfer Capital Per Diem

** 1988 SPARCS Allowances Calculations

** DRG Descriptions

** 1988 Case Payment Data Elements for Rate Setting

In practice, the majority of no-fault inpatient hospitalizations will be computed essentially as shown in the first sample calculation. The remaining sample calculations represent other typical hospitalization situations, as described in the headings for each illustration.

The correctness of a DRG classification should be confirmed prior to reimbursement using the UBF-1 information supplied by the hospital.. The UBF-1 Form should be completed and submitted by the hospital with all statements seeking reimbursement from no-fault and other third-party payors. The principal diagnosis (box 42 on UBF-I) plus any secondary diagnosis (boxes 48-51) are grouped to determine the DRG classification.

These diagnostic designations by the hospital can be verified by review of the underlying hospital record, which the no-fault payor is entitled to inspect upon timely request. No-fault payors should consider inspecting hospital records for this purpose on a random or selective basis.

The Insurance Department is concerned that there has been inadequate comprehension of, and compliance with, the DRG reimbursement system to date. The Department is also conducting a special study to evaluate the cost impact of conversion and compliance.

Any questions or problems in connection with DRG implementation involving no-fault insurers should be brought to the attention of Barbara Neidich (212-602-0334), Associate Examiner in the Department's Property & Casualty Insurance Bureau, at the above address.

Very truly yours,

[SIGNATURE]

JAMES P. CORCORAN

SUPERINTENDENT OF INSURANCE

EXAMPLE

(1) NO-FAULT 1988 CALCULATION OF INPATIENT HOSPITALIZATION BILLS FOR INLIERS (HOSPITALIZATION WITHIN TRTMPOINTS)

(2) NO-FAULT 1988 PAYMENT CALCULATION OF SHORT STAY OUTLIER DRG

(3) NO-FAULT 1988 PAYMENT CALCULATION FOR LONG STAY OUTLIER DRG

(4) NO-FAULT ALTERNATE LEVEL OF CARE

(5) NO-FAULT 1988 TRANSFER PAYMENT WITH ALTERNATE LEVEL. OF CARE CARED TO INLIER PAYMENT

(6) NO-FAULT 1988 SHORT STAY OR TRANSFER PAYMENT CALCULATION

(7) NO-FAULT 1988 TRANSFER PAYMENT WITH ALTERNATE LEVEL OF CARE COMPARED TO LONG STAY OUTLIER PAYMENT

(8) NO-FAULT HIGH COST OUTLIER WITH ALTERNATE LEVEL OF CARE

(9) NO-FAULT DETERMINATION OF EXEMPT UNIT (HOSPITAL) ACUTE CARE PAYMENT

(10) NO-FAULT DETERMINATION OF ALTERNATE LEVEL OF CARE PAYMENT-EXEMPT HOSPITAL OR UNIT

EXAMPLE

(1) Inlier

This calculation is used for an inpatient hospitalization where the stay is within the trimpoints as listed on Table S for that specific DRG and No alternate level of care (ALC) is required.

(2) Short Stay Outlier

This calculation is used for an inpatient hospitalization where the stay is less than the short trimpoint listed on Table S for that specific DRG.

(3) Long Stay Outlier

This calculation is used for an inpatient hospitalization where the stay is longer than the long trimpoint listed on Table S for that specific DRG. This calculation will provide the additional amount to be paid over a regular DRG (Inlier).

(4) Alternate Level of Care (ALC)

This calculation is for an additional amount to be paid over the calculated amount for the DRG when the patient is awaiting for the DRG when the patient is awaiting release from the hospital either to a non acute facility or when arrangements are being made for home health care.

(5), (6) and (7)

These calculations are made by a hospital which is transferring a patient to another acute facility. The transfer amount cannot exceed the amount of inlier, short stay outlier or long stay inlier DRG.

(8) This calculation is used when a hospital's actual charges are far in 1(8) excess of a calculated inlier DRG payment only. It does not apply on a short stay outlier, long, stay outlier, or transfers. There are test Checks within this calculation which are in accordance with New York State Health Department Laws [subpart 86.1.55(c)(2)] and should be followed carefully when determining any additional payment to be made.

(9) This calculation is for an exempt unit (hospital) - medical rehabilitation, Psychiatric, AIDS center, Alcohol Rehabilitation, etc.

(10) This calculation is for a patient in an exempt facility awaiting release to a non acute facility or awaiting arrangements for home health care. NO-FAULT

EXAMPLE 1

NO-FAULT

1988 CALCULATION OF INPATIENT HOSPITALIZATION BILLS

FOR INLIERS (HOSPITALIZATIONS WIMIN TRD4POINTS)

SAMPLE

CALCULATION

(1)

Case Mix Neutral Cost

Per Discharge x 1.13

Table M. Col. 1

$ 2,712.00

(2)

DRG Classification

UBF-1

(3)

Per Case Service

Intensity

Weight (SIW) for DRG

Classification

Table S, Col. 3

2.8738

(4)

Inlier DRG

Line 1 x Line 3

$ 7,793.75

(5)

Capital Cost Per

Discharge x 1.13

Table M, Col. 2

$ 316.40

(6)

Inlier DRG Before

Add -Ons

Line 4 x Line 5

$ 8,110.15

(7)

Bad Debt Regional

% Add-On

Table M, Col. 3

3.80%

(8)

Bad Debt and Charity

Care Amount

Line 6 x Line 7

$ 308.19

(9)

Excess Physicians

Malpractice Per

Discharge

x 1.13

Table M, Col. 4

$ 67.80

(10)

SPARCS Allowance

a. Per Discharge

Table R, Col. K

1.50

b. Increase by 13%

Line 10a x 1.13

1.70

(11)

Total No-Fault-Inlier

Line 6 + Line 8 +

Line 9 + Line 10b

$ 8,487.84

EXAMPLE 2

NO-FAULT

1988 PAYMENT CALCULATION OF SHORT STAY

OUTLIER DRG *

SAMPLE

CALCULATION

(1)

Case Mix Neutral Cost

Per Discharge x 1.13

Table M, Col. 1

$ 2,712.00

(2)

DRG Classification

UBF-1

(3)

Per Case Service

Intensity Weight (SIW)

for DRG Classification

Table S, Col. 3

2.8738

(4)

Subtotal

Line 1 x Line 3

$ 7,793.60

(5)

Group Average Arithmetic

Inner Length of Stay

for DRG

Table S, Col.

6 OR 7

(6)

Subtotal

Line 4 + Line 5

$ 599.52

(7)

Short Stay Adjustment

Factor

Subpart

150.00%

86-1.55(a)

(8)

Short Stay Outlier DRG

Cost Per Day

Line 6 x Line 7

$ 899.28

(9)

a. Short Stay Capital

Per Diem

Table Q

$ 35.00

b. Increase by 13%

Line 9a x 1.13

$ 39.55

(10)

Short Stay Outlier Cost

Per Day

Line 8, + Line 9b

$ 938.83

(11)

Number of Total Days

UBF-1

(12)

Short Trimpoint

Table S, Col. 4

*NOTE: PROCEED ONLY IF LINE 11 IS LESS THAN 12 OR SAME

WY /MISSION AND DISCHARGE

(13)

Subtotal

Line 10 x Line 11

$ 938.83

(14)

Bad Debt Regional %

Add-On

Table WI, Col. 3

3.80%

(15)

Bad. Debt and Charity

Care Amount

Line 13 x Line 14

$ 35.68

NO-FAULT

1988 PAYMENT CALCULATION OF SHORT STAY

OUTLIER DRG*

SAMPLE CALCULATION

(16) Excess Physicians'

Malpractice Per

Discharge x 1.13

Table Id, Col. 4

$ 67. 80

(17) SPARCS Allowance

a. Per Discharge

Table R, Col. K

1.50

b. Increase by 13%

Line 17a x 1.13

$ 1.70

(18) Total No-Fault Short Stay

Outlier Payment

Line 13 + Line 15 +

Line 16 + Line 17b

$ 1, 044. 01

* DO NOT USE THIS METHODOLOGY FOR PATIENTS ASSIGNED TO A DRG SPECIFICALLY DESIGNATED AS A DRG FOR TRANSFERRED PATIENT'S ONLY; BURNS TRANSFERRED TO ANOTHER ACUTE FACILITY (DRG 456), NEONATE, TRANSFERRED 4. 4 DAYS OLD (DRG 601); NORMAL NEWBORN (111 Gs 620 629); NORMAL DELIVERY am 373); AND TRANSFERS. SUBPART 86.150(8)(2)

(1) Long Stay Group Price

x 1.13

Table M, Col. S

$ 2,881.50

(2) DRG Classification

UBF-1

(3) Per Case Service Intensity

Weight (SIW) For DRG

Classification

Table S, Col. 3

2,8738

(4) Subtotal

Line 1 x Line 3

$ 8,280.85

(5) Group Average

Arithmetic Inner Length

of Stay for DRG$ HTable S, Col. 6 OR 7

(6) Subtotal

Line 4 + Line 5

$ 636.99

(7) Long Stay Outlier Cost

Adjustment Factor

Subpart 86-1.55(b)

0.60

(8) Subtotal

Line 6 x Line 7

$ 382.19

(9) Price Component Percent

Subpart 86-1.53

10.00%

(10) Long Stay Outlier DRG

Cost Per Day

Line 8 x Line 9

$ 38.22

(11) Number of Total Days

UBF-1

(12) Long Trimpoint

Table S, Col. 5

(13) Number of Long Stay Days

Line 11 - Line 12

(14) Long Stay Outlier DRG

Line 10 x Line 13

$ 382.20

(15) Bad Debt Regional % Add-On

Table NI, Col. 3

3.80%

(16) Bad Debt and Charity Care

Amount

Line 14 x Line 15

$ 14.52

(17) Total No-Fault Payment

a. Long Length of

Stay Outlier

Line 14 + Line 16

$ 396.72

b. Inlier

(Must Compute as Illustrated

$ 8,487.84

c. Total No-fault payment

Line 17a + Line 17b

$ 9,395.26

(1) Alternate Level of

Care Case payment

Increased by 13%

Table P, Col. 1

$ 98.40

(2) Bad Debt Regional

% Add-On

Table M, Col. 3

3.80%

(3) Bad Debt and Charity

Care Amount

Line 1 x Line 2

$ 3.74

(4) ALC Per Diem Rate

Line 1 Line 3

$ 102.14

(5) Number ALC Days in

Billing Period

UBF-1 Box 144

(6) Total Alternate

Level of Care Payment

Line 4 x Line 5

$ 510.70

*NOTE: ADD TO INLIER PAYMENT, INLIER AND LONG STAY OUTLIER PAYMENT, HIGH COST OUTLIER PAYMENT OR TRANSFER PAYMENT PDR TOTAL PAYMENT ALTERNATE LEVEL OF CARE EMMERT HAS TO BE ADDED TO ANOTHER DRG PAYMENT COMPONENT. THIS ALTERNATE LEVEL OF CARE PAYMENT CANNOT BE USED WITH EXEMPT UNITS OR EXEMPT HOSPITALS

(1) Case Mix Neutral Cost

Per Discharge x 1.13

Table M, Col. 1

$ 2,712.00

(2) DRG Classification

UBF-1

(3) Per Case Service

Intensity Weight (SIW)

for DRG Classification

Table S, Col. 3

2.8738

(4) Subtotal

Line 1 x Line 3

$ 7,793.15

(5) Group Average Arithmetic

Inlier Length of Stay

for DRG

Table S, Col. 6 or 7

(6) Subtotal

Line 44-Line 5

$ 599.52

(7) Transfer Adjustment

Factor

Subpart 86-1.55(1)

120.00%

(8) Transfer DRG Cost Per Day

Line 6 x Line 7

$ 719.42

(9) Number of Transfer Days

UBF-1 (Field 199-S)

(10) Transfer ERG. Cost

Line 8 x Line 9

$ 7,194.20

***A NOTE: TOTAL 1RANSF/311 PAYMENT CAN NOT EXCEED AMOUNT THAT WOULD HAVE BEM PAID IF THE PATIENT HAD BEEN DISCHARGED (SUBPART 86-1.54(1)****

(11) Discharge DRG Test

a. Inlier DRG

Example (1), Line 4

$ 7,793.75

b. Long Stay Outlier DRG

Example (3), Line 14

c. Short Stay Outlier DRG

1. Short Stay Outlier

DRG Cost Per Day

Example (2), Line 8

2. Number of Days

Example (2), Line 11

3.Short Stay.

Outlier DRG

Line 11c1 x Line 11c2

d. Total

Line 11a + Line 11b +

$ 7,793.75

Line 11c3

e. Transfer DRG Less

Than Discharge DRG

Line 10< Line 11d

$ 7,194.20

f. Transfer DRG Greater

Than Discharge DRG

Line 10> Line 11d

****NOTE: PROCEED ONLY IF LINE 10 IS LESS THAN LINE 11d ****

(12) a. Transfer Capital Per

Diem

Table Q

$ 35.00

b. Increase by 13%

Line 12a x 1.13

$ 39.55

c. Total Transfer Capital

Line 9 x Line 12b

$ 395.50

(13) Subtotal

Line 11e + Line 12c

$ 7,589.70

(14) Bad Debt Regional %

3.80%

Add-On

Table M, Col. 3

(15) Bad Debt and Charity

Care Amount

Line 13 x Line 14

$ 288.41

(16) Excess Physicians

Malpractice Per

Discharge x 1.13

Table M, Col. 4

$ 67.80

(17) SPARCS Allowance

a. Per Discharge

Table R, Col. K

1.50

b. Increase by 13%

Line 17a x 1.13

1.70

(18) Total No-Fault Payment

a. Transfer

Line 13 + Line 15 +

$ 7,947.61

b. Alternate Level

of Care

Example 4

$ 510.70

c. Total

Line 18a + Line 18b

$ 8,458.31

*DO NOT USE THIS NETHODOLOGY FOR PATIENTS ASSIGNED TO A TRG SPECIFICALLY DESIGNATED AS A DRG FOR TRANSFERRED PATIENTS ONLY. BURNS TRANSFERRED 1X) AN THER ACUT E F A CILITY (DRG 456), NEONATE, TRANSFERRED <= 4 DAYS OLD (DRG 601 SUBPART 86-1.50(j)

NO-FAULT 1988 SHORT STAY OR TRANSFER PAYMENT CALCULATION*

SAMPLE

CALCULATION

(1)

Case Mix Neutral

Cost Per Discharge

x 1.13

Table M, Col. 1

$ 2,712.00

(2)

DRG Classification

UBF-1

(3)

Per Case Service

Intensity Weight (SIW)

For DRG Classification

Table S, Col. 3

2.8738

(4)

Subtotal

Line 1 x Line 3

$ 7,793.75

(5)

Group Average Arithmetic

Inlier Length of Stay

For DRG

Table S, Col. 6 or 7

(6)

Subtotal

Line 4/Line 5

$ 599.52

(7)

Transfer Adjustment

Factor

Subpart 86-1.55(1)

120.00%

(8)

Transfer DRG Cost Per Day

Line 6 x Line 7

$ 719.42

(9)

Number of Transfer Days

UBF-1

(10)

Transfer DRG Cost

Line 8 x Line 9

$ 719.42

**** NOTE: TOTAL TRANSFER PAYMENT CAN NOT EXCEED AMOUNT THAT WOULD

HAVE BEEN PAID IF THE PATIENT HAD BEEN DISCHARGED

(SUBPART 86-1.54(1) ****

(11)

Discharge DRG Test

a. Inlier DRG

Line 4 on Example (1)

b. Long Stay Outlier DRG

Line 14 on Example (3)

c. Short Stay Outlier DRG

1. Short Stay Outlier

DRG Cost Per Day

Line 8 on Example (2)

$ 899.28

2. Number of Days

Line 11 on Example (2)

3. Short Stay Outlier

DRG

Line 11c.1 x 11c.2

$ 899.28

d. Total

Line lla + Line llb +

Line 11c.3

$ 899.28

e. Transfer DRG Less

$ 719.42

Than Discharge DRG

f. Transfer DRG Greater

Than Discharge DRG

**** NOTE: PROCEED ONLY IF LINE 10 IS LESS THAN LINE 11d ****

(12)

a. Transfer Capital

Per Diem

Table Q

$ 35.00

b. Increase by 13%

Line 12a x 1.13

$ 39.55

c. Total Transfer Capital

Line 9 x Line 12b

$ 39.55

(13)

Subtotal

Line lle + Line 12c

$ 758.97

(14)

Bad Debt Regional % Add-On

Table M, Col. 3

3.80%

(15)

Bad Debt and Charity

Care Amount

Line 13 x Line 14

28.84

(16)

Excess Physicians

Malpractice Per Discharge

x 1.13

Line M, Col. 4

67.80

(17)

SPARCS Allowance

a. Per Discharge

Table R Col. K

1.50

b. Increase by 13%

Line 17a x 1.13

1.70

(18)

Total No-Fault Payment

a. Transfer

Line 13 + Line 15

+ Line 16 + Line 17b

$ 857.31

b. Alternate Level of Care

Example 4 Line 6

c. Total

Line 18a x Line 18b

$ 857.31

*DO NOT USE THIS METHODOLOGY FOR PATIENTS ASSIGNED TO A DRG SPECIFICALLY DESIGNATED AS A DRG FOR TRANSFERRED PATIENTS ONLY. BURNS TRANSFERRED TO ANOTHER ACUTE FACILITY (DRG 456), NEONATE, TRANSFERRED<= 4 DAYS OLD (DRG 601) SUBPART 86-1.50(j)

NO-FAULT 1948 TRANSFER PAYMENT WITH ALTERNATE LEVEL OF CARE COMPARED TO LONG STAY OUTLIER PAYMENT*

SAMPLE

CALCULATION

(1)

Case Mix Neutral Cost

Cost Per Discharge

x 1.13

Table M, Col. 1

$ 2,712.00

(2)

DRG Classification

UBF-1

(3)

Per Case Service

Intensity Weight (SIW)

2.8738

for DRG Classification

Table S, Col. 3

(4)

Subtotal

Line 1 x Line 3

$ 1,793.75

(5)

Group Average Arithmetic

Inlier Length of Stay

for DRG

Table S,

Col. 6 or 7

(6)

Subtotal

Line 4 / Line 5

$ 599.52

(7)

Transfer Adjustment

Factor

Subpart 86-1.SS(1)

120.00%

(8)

Transfer DRG Cost Per Day Line

6 x Line 7

$ 719.42

(9)

Number of Transfer Days

UBF-1

(10)

Transfer DRG Cost

Line 8 x Line 9

$ 38,848.68

**** NOTE: TOTAL TRANSFER PAYMENT CAN NOT EXCEED AMOUNT THAT WOULD

HAVE BEEN PAID IF THE PATIENT HAD BEEN DISCHARGED

(SUBPART 86-1.54(1) ****

(11)

Discharge DRG Test

a. Inlier DRG

Example (1), Line 4

$ 7,793.75

b. Long Stay Outlier DRG

Example (3), Line 14

$ 382.20

c. Short Stay Outlier DRG

1. Short Stay Outlier

DRG Cost Per Day

Example (2), Line 8

2. Number of Days

Example (2), Line 11

3. Short Stay Outlier

DRG

Line 11c.1 x 11c.2

d. Total

Line 11a + Line 11b +

Line 11c.3

$ 8,175.95

e. Transfer DRG Less

Than Discharge DRG

Line 10< Line 11d

f. Transfer DRG Greater

Than Discharge DRG

Line 10> Line 11d

$ 38 848.68

**** NOTE: PROCEED ONLY IF LINE 10 IS LESS THAN LINE 11d ****

(12)

a. Transfer Capital

Per Diem

b. Increase by 13%

c. Total Transfer Capital

(13)

Subtotal

(14)

Bad Debt Regional % Add-On

(15)

Bad Debt and Charity

Care Amount

(16)

Excess Physicians

Malpractice Per

Discharge

x 1.13

(17)

SPARCS Allowance

a. Per Discharge

b. Increase by 13%

(1)

Total No-Fault Payment

a. Transfer

b. Alternate Level of Care

c. Total

*DO NOT USE THIS METHODOLOGY FOR PATIENTS ASSIGNED TO A DRG SPECIFICALLY DESIGNED AS A DRG FOR TRANSFERRER PATIENTS ONLY. BURNS TRANSFERRED TO ANOTHER ACUTE FACILITY (DRG 456), NEONATE, TRANSFERRED4<=4 DAYS OLD (DRG 601) SUBPART 86-1.50(j)

NO-FAULT HIGH COST OUTLIER WITH ALTERNATE LEVEL OF CARE*

(1)

High Cost Outlier Charge

Converter

Table T, Col. 11

(2)

Total Inpatient Gross

Charges Per Patient UBF-1

UBF-1, Field 197

(3)

Adjustment to Total

Inpatient Gross Charges

a. Telephone and Telegraph

UBF-1, Field 196, Code 561

b. Television and Radio

Rentals

UBF-1 Field 196, Code 584

c. Private Room

Differential

UBF-1 Field 193, Code 2031-

d. Blood

UBF-1, Field 187

e. Other

UBF-1 Field 193 or 196

(4)

Total Inpatient Gross

Charges for Cost Centers

201-234

Line 2-(Line 3a + Line 3b

+ Line 3c + Line 3d + Line 3e)

(5)

Total Gross Inpatient

Charges Reduced to Cost

Line 1 x Line 4

(6)

Inlier DRG Before Add-Ons

Example 1, Line 6

(7)

Twice Inlier DRG Before

Add-Ons

Line 6 x 2 [Subpart

86-1.55(C)(2)]

(8)

Inlier Blended Acute Cost

Per Discharge

Increased by 13%

Example 1, Line 1

(9)

Hospital Specific Average

Non-Medicare Case Mix Index

Table T, Col. 11

(10)

Subtotal

Line 8 x Line 9

(11)

Capital Cost Per Discharge

Increased by 13%

Example 1, Line 5

SAMPLE

CALCULATION

(1)

High Cost Outlier Charge

Converter

0.850007

(2)

Total Inpatient Gross

Charges Per Patient UBF-1

$ 31,883.71

(3)

Adjustment to Total

Inpatient Gross Charges

a. Telephone and Telegraph

20.00

b. Television and Radio

Rentals

60.00

c. Private Room

Differential

d. Blood

e. Other

(4)

Total Inpatient Gross

Charges for Cost Centers

201-234

$ 31,803.71

(5)

Total Gross Inpatient

Charges Reduced to Cost

$ 27,033.38

(6)

Inlier DRG Before Add-Ons

$ 8,110.15

(7)

Twice Inlier DRG Before

Add-Ons

$ 16,220.30

(8)

Inlier Blended Acute Cost

Per Discharge

Increased by 13%

$ 2,712.00

(9)

Hospital Specific Average

Non-Medicare Case Mix Index

1.4435

(10)

Subtotal

$ 3,914.77

(11)

Capital Cost Per Discharge

Increased by 13%

$ 316.40

EXAMPLE 8

NO-FAULT

HIGH COST OUTLIER WITH ALTERNATE LEVEL OF CARE*

SAMPLE

CALCULATION

(12)

Average Cost Per Discharge

Line 10 + Line 11

$ 4,231.17

(13)

Six Times Average Cost

Line 12 x Line 6

Per Discharge

[Subpart 86-1.55(c)(2)]

$ 25,387.02

(14)

Greater of Twice Inlier

DRG Before Add-Ons or

Line 7 > Line 13

Six Times Average Cost

Line 13> Line 7

Per Discharge

[Subpart 86-1.55(c)(2)]

$ 25,387.02

(15)

Total Co Gross Inpatient

Covered Charge Reduced

To Cost Less Greater

of Twice Inlier DRG

Before Add-Ons or

Six Time Average Cost

Line 5 - Line 14

$ 1,646.36

Per Discharge

[Subpart 86-1.55(c)(2)]

(16)

Alternate Level of Care

a. Operating Per Diem

Example 4, Line 1

$ 98.40

b. Number of ALC Days

Example 4, Line 5

c. Total

Line 16a x Line 16b

$ 492.00

(17)

Total Gross Inpatient

Covered Charges Reduced

to Cost Less Greater

of Twice Inlier DRG

Before Add-Ons or Six

Times Average Cost Per

Discharge and Less

Alternate Level of Care

Line 15 - Line 16c

$ 1,154.36

**** NOTE: CONTINUE CALCULATION STEPS ONLY IF LINE 5 GREATER

THAN LINE 17 ****

(18)

Bad Debt Regional

% Add-On

Example 1, Line 7

3.80%

(19)

Bad Debt and Charity

Care Amount

Line 17 x Line 18

$ 43.87

(20)

Total No-Fault. Payment

a. High Cost Outlier

Line 17 + Line 19.

$ 1,198.23

b. Inlier

Example 1, Line 11

$ 8,487.84

c. alternate Level of Care

Example 4, Line 6

$ 510.70

d. Total

Line 20a + Line 20b

+ LINE 11c

$ 10,196.77

THIS CALCULATION IS USED WHEN A HOSPITAL'S ACTUAL CHARGES EXCEED THE DRG PAYMENT BY A WIDE MARGIN. THIS CALCULATION MAY GENERATE A HIGHER PAYMENT THAN COMPUTED IN EXAMPLE 1 + EXAMPLE 4

NOTE: HIGH COST OUTLIER PAYMENT DOES NOT APPLY TO CASES THAT QUALIFY AS LONG STAY OUTLIERS, SHORT STAY OUTLIERS OR TRANSFERS (OTHER THAN PATIENTS ASSIGNED TO TRANSFER DRGS) SUBPART 86-1.55 (c)(3)

EXAMPLE 9

NO-FAULT

DETERMINATION OF EXEMPT UNIT (HOSPITAL) ACUTE CARE PAYMENT (MEDICAL REHAB., ALCOHOL REHAB., PSYCH, AIDS CENTER, CHILDREN, CENTER, CHILDREN, CANCER, MENTAL RETARDATION, HOSPICE)

1988 PAYMENT CALCULATION WORKSHEETS

SAMPLE

CALCULATION

(1)

Per Diem x 1.13

Table N, Col. 1,3,5,7,9,11

$ 406.80

(whichever col. applies)

(2)

Bad Debt Regional Add-On

Line 14, Col. 3

3.80%

(3)

Bad Debt and Charity

Care Per Diem Amount

Line 1 x Line 2

$ 15.46

(4)

Excess Malpractice

Per Diem x 13%

Table N, Col. 2,4,6,8,10,12

7.12

(whichever col. applies)

(5)

SPARCS Allowance

a. Per Day

Table R, Col. G

0.25

b. Increase by 13%

Line Sa x 1.13

0.28

(6)

Exempt Unit Acute

Care Rate Per Day

Line 1 + Line 3 +

$ 429.66

Line 4 + Line Sb

(7)

Number of Exempt

Unit Days

UBF-1, Field 199-

Field 5

(8)

Total No-Fault Exempt

Unit (Hospital) Acute

Care Payment

Line 6 x Line 7

$ 6,444.90

EXAMPLE 10

NO-FAULT

DETERMINATION OF ALTERNATE LEVEL OF CARE PAYMENT

EXEMPT HOSPITAL OR UNIT

SAMPLE

CALCULATION

(1)

Alternate Level of

Care Increased by 13%

Table P, Col. 2,3,4,5,6, or 7

$ 114.50

(2)

Bad Debt Regional % Add-On

Table M, Col. 3

3.80%

(3)

Bad Debt and Charity

Care Amount

Line 1 x Line 2

$ 4.35

(4)

Excess Malpractice

Per Diem x 13%

Table N, Col. 2,4,6,8,10 or 12

7:12

(5)

SPARCS Allowance

a. Per Day

Table Col. G

0.25

b. Increase by 13%

Line Sa x 1.13

0.28

(6)

Exempt Unit or Hospital

Alternate Level of

Line 1 + Line 3 +

Care Rate Per Day

Line 4 + Line 5b

$ 126.25

(7)

Number of ALC Days

in Billing Period

UBF-1

(8)

Total No-Fault Exempt

Unit or Hospital

Alternate Level of Care

Payment

Line 6 x Line 7

$ 631.25

NOTE: DO NOT USE THIS ALC PAYMENT CALCULATION WITH INLIER, LONG STAY, SHORT STAY, TRANSFER, OR HIGH COST OUTLIER PAYMENT CALCULATIONS. THIS ALC PAYMENT CALCULATION USES DATA FOR FOR THE UNIT OR HOSPITAL IN WHICH THE PATIENT RECEIVED SERVICES (E.G., MEDICAL REHABILITATION).

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