Transcript Understanding Medicare Files: Utilization, Payment, and Cost Wei Yu, Ph.D. Economics Training Course

Understanding Medicare Files:
Utilization, Payment, and Cost
Wei Yu, Ph.D.
Economics Training Course
October 5, 2005
Utilization Files
Differences between VA and Medicare Files
• VA Utilization Files
– Organized by type of utilization
– Patients identified by encrypted ID
– No bill settlement process
• Medicare Utilization Files
– Grouped by type of claims
– Created in three levels of patient confidentiality
– Claims to be settled after review
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Utilization Files
Record Group by Claims (1)
 Institutional Claims (Part A except outpatient):
• Inpatient (short/long)
• Outpatient (Part B)
• Home Health (Part A & B)
• Hospice
• Skilled Nursing Facilities
– One file for each type of claim
– Claims are processed by Fiscal Intermediaries (FI)
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Utilization Files
Record Group by Claims (2)
Non-Institutional Claims (Part B):
• Physician, nurse practitioners, and other
professionals
• Clinical Laboratories (Independent Labs and Lab
services provided in a physician’s office)
• Ambulance services
• Ambulatory Surgery Center (stand alone)
– All above claims in one file: Physician/supplier
– Claims are processed by Carriers
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Utilization Files
Record Group by Claims (3)
Non-Institutional Claims (Part B):
• Durable Medical Equipment (DME)
– DME claims are separated from other Part B
claims
– DME claims are processed by 4 special DME
carriers
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Utilization Files
Levels of Patient Confidentiality (1)
•
•
•
•
Research Identifiable Files (RIFs)
Beneficiary Encrypted Files (BEFs)
Limited Data Set (LDS)
Downloadable files
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Utilization Files
Levels of Patient Confidentiality (3)
• What files exist only as a downloadable or
as a file for purchase?
– Provider files
– Cost report files
• Files for purchase directory is available on
the CMS website at
http://www.cms.hhs.gov/data/order/default.asp (10/1/2005)
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Utilization Files
Levels of Patient Confidentiality (4)
• How do BEFs differ from RIFs?
– Some variables are either encrypted,
blanked, or ranged
(http://www.cms.hhs.gov./data/recordlayo
uts/default.asp)
– BEFs require study protocol and either an
IRB HIPAA waiver or review by CMS’s
internal privacy board.
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Utilization Files
Levels of Patient Confidentiality (5)
• What is unique about RIFs?
– Contain person-specific data on Medicare
beneficiaries and the providers of the
service
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Utilization Files
Levels of File Processing Stage
• National Claims History (NCH) file
– Contain every claim submitted and
adjustment records
• Standard Analytical Files (SAFs)
– Processed through final action algorithms
• Inpatient stay file: MEDPAR
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Utilization Files
Standard Analytical Files (1)
• Standard Analytical Files (SAFs)
– Claim level data
– Final action (adjustments are resolved)
– Updated quarterly beginning with the first 6
months and continuing through 18 months
– 18 months cut-off is approximately 98.8%
complete
– Two levels of patient confidentiality
• RIFs and BEFs
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Utilization Files
Standard Analytical Files (2)
• Institutional Claims (1991 – Current)
– 100% for all institutional claims, 5% sample, or by geographic or
clinical cohort selection
•
•
•
•
•
Inpatient
Outpatient
Home Health Agency
Hospice
Skilled Nursing Facilities (SNF)
• Non-Institutional Claims (1991 – Current)
– 100% for
• laboratory claims
• Durable Medical Equipment (DME)
– All claims for the 5% CMS sample or by geographic or clinical
cohort selection
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Utilization Files
Inpatient Stay File (1)
• Medicare Provider Analysis and Review
File (MEDPAR) (1991 – Current)
– One record per stay for hospital inpatient and
SNF
– Contains only discharged hospital stays
– SNF stay is included on the date of admission
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Utilization Files
Inpatient Stay File (2)
• Differences between MEDPAR and Inpatient SAF
– The inpatient SAF contains
• one record per bill
– 5% of short stays have multiple bills
– 1.2 claims per stay for long-stay hospitals
• Information about the attending and performing physician
• Detailed revenue center codes
– The inpatient SAF are not easily processed as the fixedformat MEDPAR
• SAF format: variable length only
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Utilization Files
Limitations of Medicare Data
• Exclusion of persons under 65 (except ESRD &
disabled)
• Incomplete information for managed care enrollees
• Data (variables) were collected for the purpose of
making health care payments, not for research
• Non-covered utilization records were not collected
(e.g., drugs)
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Medicare Payment
• Medicare Payment Methods
– Introduction by types of services
– Information about payment rules and regulation
• Medicare Payment for Acute Hospital
Inpatient Services
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Medicare Payment
Payment Methods (1)
 The Prospective Payment System (PPS)
– Pre-determined reimbursement rates based on average
levels of resource use for certain types of health care
services.
– Examples of adjusting for resource use
• Hospital acute inpatient care:
– ~ 500 Diagnosis Related Groups ( DRGs)
• Skilled nursing care:
– 26 Resource Utilization Groups (RUG-III)
• Home health care:
– 80 Home Health Resource Groups (HHRGs)
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Medicare Payment
Payment Methods (2)
 By type of services
–
–
–
–
–
–
Acute hospital inpatient care - PPS (1983)
Physician services - PPS (1992)
SNF - PPS (1998-1999)
HHA - PPS (10/2000)
Rehabilitation inpatient care - PPS (4/2001)
Long term care hospitalization and psychiatric services
- PPS (2002)
– Hospital outpatient services - PPS (10/2000)
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Medicare Payment
Payment Methods (3)
• Obtain payment rules and regulations
CMS web site
http://www.cms.hhs.gov/paymentsystems
(5/18/2005)
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Medicare Payment for Acute Hospital
Inpatient Care
• Issues to understand PPS payment for
inpatient care
– Medicare coverage for inpatient care
– Computation of PPS rates
– PPS payment variables recorded in HCFA file
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Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment Factors
•
•
•
•
Diagnosis (DRG weight)
Wage Index
Geographic Adjustment Factor (GAF)
Indirect medical education (IME)
adjustment
• Disproportionate Share (DSH) of Medicaid
and Disability patient adjustment
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Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment – Diagnosis
Diagnostic Related Group (DRG)
– 25 Mutually exclusive Major Diagnostic
Categories (MDCs)
– Surgical vs Medical
• Surgical: Procedures
• Medical: Principal diagnosis
– 518 DRGs (version 22 2005)
– ICD-9-CM codes are allocated into these DRGs
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2005 Medicare DRG Weight V. 22
21
16
11
6
1
1
50
99
148
197
246
-4
23
295
344
393
442
491
Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment – Wage (1)
Wage Index
• Wage is a major factor for geographic
differences in labor cost
• Wages vary by
– State
– Rural versus urban areas
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Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment - Wage (2)
Computation of Wage Index
– Based on survey data
– Ratio of local average wage and national
average wage
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2005 Wage Index (3984 Hospitals)
2
1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0
1
500
999
1498
1997
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2496
2995
3494
Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment - IME
• Indirect Medical Education (IME)
– IME adjustment factor for
• Operating cost
• Capital cost
– Based on the ratio:
R = (# of residents and interns)/(# of beds)
– Adjusted every year by CMS
http://www.cms.hhs.gov/providers/hipps/hist_impact_9
4-04.asp (5/18/2005)
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2005 IME Operating Adjustor
0.5
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
1
101
201
301
401
501
601
N=1130
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701
801
901
1001
1101
2005 IME Capital Adjustor
0.6
0.5
0.4
0.3
0.2
0.1
0
1
100
199
298
397
N=1130
496
595
29
694
793
892
991
1090
Medicare Payment for Acute Hospital Inpatient Care
PPS Adjustment – DSH (1)
• Disproportionate Share (DSH) Adjustment
– Based on
• The sum of two ratios (R):
– Part A/Supplemental Security Income (SSI) patient days to
total Medicare Part A covered days
– Medicaid but not Medicare Part A covered days to total
inpatient hospital days.
– Location and size of a hospital
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2005 DSH Operating Adjustor
1
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
1
301
601
901
1201
N=334031
1501
1801
2101
2401
2701
3001
3301
2005 DSH Capital Adjustor
0.3
0.25
0.2
0.15
0.1
0.05
0
1
501
1001
N=3340
1501
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2001
2501
3001
2005 PPS Rate Computation (1): Adjustment
Factors
Hospital location:
Baltimore
DRG for heart failure & shock
(DRG127)
Wage index for Baltimore:
Geographic adjustor:
IME operating adjustment factor:
IME capital adjustment factor:
DSH operating adjustment factor:
DSH capital adjustment factor:
1.039
0.9892
0.992592
0.113044
0.096331
0.177798
0.07263003
National adjusted operating standardized amounts:
Labor related:
$2,824.21
Non-labor related:
$1,730.97
Capital standard federal
33 payment rate:
$416.63
2005 PPS Rate Computation (2):
Operating Costs
Labor-related Standardized amount
Wage index
Wage adjusted share
$2,824
X 0.9892
= $2,794
Non-labor-related share
Wage adjusted standardized amount
+ $1,731
= $4,525
Relative weight for DRG 127
PPS Payment rate (“DRG Price”)
X 1.039
= $4,702
Indirect Medical education adjustment
($4525 x 0.113044)
Disproportionate share adjustment
($4,702 x 0.177798)
Total PPS operating payment
+ $532
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+ $836
= $6,070
2005 PPS Rate Computation (2):
Capital Costs
Standard federal rate
DRG weight
$417
X1.039
= $433
Geographic adjustment factor
X 0.992592
= $430
Indirect Medical education adjustment
($430 x 0.096331)
Disproportionate share adjustment
($430 x 0.07263003)
Total PPS capital payment
+ $41
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+ $31
= $502
Medicare Payment for Acute Hospital Inpatient Care
Payment Variables in the MEDPAR (1)
• PPS Payment
• Individual Payment
• Other Insurance Payment
• Medicare Actual Payment
• Specific Payments
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Medicare Payment for Acute Hospital Inpatient Care
Payment Variables in the MEDPAR (2)
PPS Payment Variables
• DRG Price – Including PPS operating rate,
capital rate, IME and DSH adjustment (if any)
• Outlier Payment
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Medicare Payment for Acute Hospital Inpatient Care
Payment Variables in the MEDPAR (3)
Individual Payment Variables
• Deductible
• Coinsurance
• Blood deductible
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Medicare Payment for Acute Hospital Inpatient Care
Payment Variables in the MEDPAR (4)
Medicare Actual Payment Variables
• Reimbursement Amount = DRG Price + Outlier
Payment – Individual Payment – Other
Insurance Payment
• Bill Total Per Diem = (Direct payment / Total
Medicare Days) x LOS
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Medicare Payment for Acute Hospital Inpatient Care
Payment Variables in the MEDPAR (5)
Specific Payment Variables
• IME Payment
• DSH Payment
• PPS Capital Payment
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Obtain Medicare Data for VA
Enrollees
• VA Information Resource Center (VIReC)
– Medicare Data for all VA enrollees from 1999
through 2002??
– VIReC will continue to obtain Medicare data in
future years
• Data for early years may be obtained from
the VA Office of Policy and Planning
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Files Available at VIReC (1)
• VIReC obtained all Medicare standard
analytical files (SAF) for VA patients whose
SSN can be linked with that in Medicare
database
• VIReC will provide Austin scrambled social
security number as patients’ ID in all
Medicare files
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Files Available at VIReC (2)
• Utilization files:
–
–
–
–
–
–
–
MEDPAR
Inpatient standard analytical file
Outpatient file (hospital outpatient service)
Physician/Supplier file
Home Health Agency
Durable Medical Equipment
Hospice file
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• Enrollment and demographic files:
– Denominator files
– Vital status (accumulative as Nov 30, 2004
– Group health plan (only 1999-2000)
• Provider data
– Provider of service
– Unique physician identification number
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VIReC Web Site
• General website:
– http://www.virec.research.med.va.gov
• Medicare data
http://www.virec.research.med.va.gov/Data
SourcesName/VAMedicareData/DataRequest/Procedure.htm
(9/29/2005)
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