Using Observation and Inpatient Metrics to Maximize Net Reimbursement

Transcription

1 Using Observation and Inpatient Metrics to Maximize Net Reimbursement Colleen Hall, Crowe Horwath Stephen Crouch MD, Advocate Good Samaritan Hospital 2

2 Objectives Identify industry benchmarks related to observation patient and inpatient metrics Obtain leading practices and guidance on how to implement changes in your organization Identify methods to maximize net reimbursement for observation and inpatients Determine how to navigate through the Two-Midnight Rule Prepare action plan for detailed analytics to be performed within your organization 3 Observation or Inpatient? 4

3 Internal Metrics to Evaluate Pre and Post Two Midnight Rule Observation compared to Inpatient volume Inpatient Admission percentages Overall trending of observation patient volume Average charges and reimbursement for observation vs. inpatients Average observation length of stay Average inpatient length of stay Identification of inpatient short stay volume 5 Observation as a % of Inpatient >450 Beds Weighted Mean 23.3% Beds Weighted Mean 22.8% Average 29.75% Beds Weighted Mean 22.7% 6

4 Inpatient Admissions and Observation Percentages Example 1 Minimal changes with the implementation of the two midnight rule 7 Inpatient Admissions and Observation Percentages Example 2 Significant changes with the implementation of the two midnight rule 8

5 Overall Trending of Observation Volume $ (3,828,267) Historical Trend $ (339,275) Constant 38.8% Current Forecast $ 2,353,677 Additional Improvement Toward National Average $ 4,859,153 A Current Forecasting B Expected trend if current observation to inpatient rate remained constant at 33.8% C Expected trend if historical performance related to observation increases continues D Expected trend if trended toward national average of observation to inpatient rates by 2018 E Additional Potential Improvement Opportunity 9 Charges per Observation Encounter 10

6 Inpatient Short Stays (Pre Two Midnight Rule) Average 8.7% 11 How to Maximize Observation Revenue Leading Practice Processes 1. Emergency Department and Attending physician collaboration 2. Designated observation unit 3. Specially trained clinical staff for observation patients and staff who is aware of a patient s status 4. Adequate documentation to support medical necessity 5. Nursing staff who will monitor patient condition and make appropriate calls to physicians when a status change is necessary 6. Transfer of inpatients to other units 12

7 External Benchmark Comparisons Hospital Hospital Type EXTERNALBENCHMARKS Total Beds (per AHD) Inpatient Admissions as a % of Total Discharges Short Stay Inpatients (48 hrs or less) as a % of Total Inpatient Volume Observation Patient Volume Observation Volume as a % of Inpatient Volume Observation Volume as a % of Total Discharges A Academic Medical Center % 8, % 18. B Community Hospital % 9.6% 2, % 23.2% C Community Hospital % 3.7% 4, % 15.6% D Large System Hospital % 9.1% 8, % 21.2% E Large System Hospital % 4.9% 7, % 22.6% F Large System Hospital % 4.9% 11, % 27.1% G Large System Hospital % 35.6% 1, % 4.3% H Large System Hospital % 6.7% 7, % I Large System Hospital % 13.3% 4, % 15.1% J Large System Hospital % 10.7% 4, % K Large System Hospital % 10.1% 5, % 22.8% L Large System Hospital % 0. 4, % 30.7% M Academic Medical Center % 1.4% 4, % 10.4% N Community Hospital % 2.8% 2, % 41.9% O Academic Medical Center % 9.7% 15, % 24.5% P Community Hospital % 9.1% 1, % 17.9% Q Large System Hospital % 7.3% 9, % 29.3% R Community Hospital % 5.5% 4, % 29.8% S Community Hospital % 4.8% 4, % 35.8% T Community Hospital % 3.3% 3, % 39.2% 13 The Two-Midnight Rule Inpatient or Observation? Did the physician expect the patient to require inpatient medically necessary care spanning two midnights? Does the physician document the reasons why inpatient care is necessary? Did the patient stay actually span two midnights? If not, was there a unforeseen circumstance that occurred? Was an observation order originally written but inpatient level of care became necessary during the stay? Was this documented? Could the patient have received the care as an outpatient? 14

8 Biggest Revenue Mistakes Re: Two Midnight Rule Placing every patient in Observation to start Following Interqual/Milliman over physician order or intent Lacking physician documentation Lacking physician certification Failure to validate/sign physician order prior to discharge Failure to obtain new order for inpatient status Failure to document unforeseen circumstances for short stay inpatients 15 How to Estimate Your Financial Impact (Averages) Community Hospital Assume all Medicare inpatient short stays prior to 10/1/13 would now be observation Assume all Medicare observation stays longer than 48 hours would now be inpatient Calculate the average reimbursement for those inpatient short stays and observation extended stays Total Volume (Jan - Sept 2013) Average Alternate Status Reimbursement Actual Revenue Change (Actual payment minus expected payment with status change) Medicare IP Short stays (<48 hours) 654 $ 2,859 $ (3,591,037) Medicare Observation Long Stays (> 48 hours) 44 $ 8,350 $ 241,552 Net Impact $ (3,349,485) 16

9 DRG How to Estimate Your Financial Impact (by DRG) Medicare Inpatients Moving to Observation <48 Hours DRG Descriptions IP Encounter s IP Avg Net Rev OBS encounters Obs Avg Net Rev IP moving to Obs 1 Year Impact $ (13,641,120) Reimbursemen t % Obs/IP 13 TRACHEOSTOMY FOR FACE,MOUTH & NECK DIAGNOSES W/O CC/MCC 1 $ 2,160 $ - 20 INTRACRANIAL VASCULAR PROCEDURES W PDX HEMORRHAGE 1 $ 66,817 $ 37,055 $ (29,761) 23 CRANIO W MAJOR DEV IMPL/ACUTE COMPLEX CNS PDX W MCC 3 $ 36,535 $ 20,261 $ (48,820) 25 CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES 5 $ 33,179 $ 18,400 $ (73,892) 26 CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES 2 $ 19,610 $ 10,875 $ (17,469) 27 CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES 44 $ 17,349 2 $ 3,019 $ (630,482) 17% 28 SPINAL PROCEDURES W MCC 2 $ 40,946 $ 22,708 $ (36,476) 29 SPINAL PROCEDURES W CC OR SPINAL NEUROSTIMULATORS 3 $ 14,880 3 $ 30,861 $ 47, % 30 SPINAL PROCEDURES W/O CC/MCC 3 $ 12,398 3 $ 3,756 $ (25,926) 3 32 VENTRICULAR SHUNT PROCEDURES W CC 16 $ 13,757 2 $ 3,527 $ (163,680) 26% 33 VENTRICULAR SHUNT PROCEDURES W/O CC/MCC 12 $ 10,329 1 $ 4,918 $ (64,927) 48% 34 CAROTID ARTERY STENT PROCEDURE W MCC 3 $ 24,459 $ 13,564 $ (32,683) 35 CAROTID ARTERY STENT PROCEDURE W CC 3 $ 15,433 $ 8,559 $ (20,622) 36 CAROTID ARTERY STENT PROCEDURE W/O CC/MCC 13 $ 10,458 $ 5,800 $ (60,555) 37 EXTRACRANIAL PROCEDURES W MCC 3 $ 19,362 2 $ 1,944 $ (52,254) 1 38 EXTRACRANIAL PROCEDURES W CC 10 $ 10,846 $ 6,015 $ (48,311) 39 EXTRACRANIAL PROCEDURES W/O CC/MCC 50 $ 7,034 3 $ 4,921 $ (105,665) 7 40 PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W MCC 1 $ 27,637 $ 15,327 $ (12,310) 41 PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W CC OR 1 $ 15,385 3 $ 13,959 $ (1,426) 91% 42 PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W/O CC/M 5 $ 12,575 6 $ 7,823 $ (23,762) 62% 52 SPINAL DISORDERS & INJURIES W CC/MCC 1 $ 8,048 2 $ 1,394 $ (6,654) 17% 53 SPINAL DISORDERS & INJURIES W/O CC/MCC 1 $ 6,484 1 $ 1,007 $ (5,477) 16% 54 NERVOUS SYSTEM NEOPLASMS W MCC 4 $ 9,673 1 $ 4,048 $ (22,499) 42% 55 NERVOUS SYSTEM NEOPLASMS W/O MCC 15 $ 6,908 4 $ 1,864 $ (75,659) 27% 56 DEGENERATIVE NERVOUS SYSTEM DISORDERS W MCC 2 $ 11,220 2 $ 8,064 $ (6,312) 72% 57 DEGENERATIVE NERVOUS SYSTEM DISORDERS W/O MCC 13 $ 5, $ 1,492 $ (53,530) 27% 59 MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA W CC 1 $ 4,972 $ 2,758 $ (2,215) 60 MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA W/O CC/MCC 2 $ 5,151 $ 2,857 $ (4,589) 61 ACUTE ISCHEMIC STROKE W USE OF THROMBOLYTIC AGENT W 2 $ 19,487 $ 10,807 $ (17,360) 64 INTRACRANIAL HEMORRHAGE OR CEREBRAL INFARCTION W MC 53 $ 11,395 3 $ 1,926 $ (501,840) 17% 65 INTRACRANIAL HEMORRHAGE OR CEREBRAL INFARCTION W CC 69 $ 6, $ 2,711 $ (242,295) 44% 66 INTRACRANIAL HEMORRHAGE OR CEREBRAL INFARCTION W/O 103 $ 4, $ 4,053 $ (74,022) 85% 67 NONSPECIFIC CVA & PRECEREBRAL OCCLUSION W/O INFARCT W MCC 2 $ 2,499 $ - 68 NONSPECIFIC CVA & PRECEREBRAL OCCLUSION W/O INFARCT 9 $ 5, $ 2,345 $ (31,217) 4 69 TRANSIENT ISCHEMIA 88 $ 4, $ 3,511 $ (56,545) 85% 70 NONSPECIFIC CEREBROVASCULAR DISORDERS W MCC 3 $ 7,998 5 $ 3,026 $ (14,914) 38% 71 NONSPECIFIC CEREBROVASCULAR DISORDERS W CC 6 $ 4, $ 3,112 $ (7,344) 72% 72 NONSPECIFIC CEREBROVASCULAR DISORDERS W/O CC/MCC 4 $ 4, $ 2,900 $ (5,283) 69% 73 CRANIAL & PERIPHERAL NERVE DISORDERS W MCC 4 $ 8,214 9 $ 1,762 $ (25,811) 21% 74 CRANIAL & PERIPHERAL NERVE DISORDERS W/O MCC 19 $ 5, $ 2,732 $ (44,230) 54% 76 VIRAL MENINGITIS W/O CC/MCC 1 $ 5,174 $ 2,870 $ (2,305) 77 HYPERTENSIVE ENCEPHALOPATHY W MCC 2 $ 10,925 $ 6,059 $ (9,732) Estimated Annual Impact: ($13,641,120) - Most common short stay DRGs Be sure to exclude inpatient only procedures 17 How to Estimate Your Financial Impact (by DRG) Continued 1 Year Impact Medicare Observation Patients >48 hours Moving to IP $ 5,421,173 IP Avg Net Reimbursement DRG DRG Descriptions IP Encounters Reimbursement OBS encounters Obs Avg Net Rev Obs moving to IP % Obs/IP 1 HEART TRANSPLANT OR IMPLANT OF HEART ASSIST SYSTEM W MCC 9 $ 234,600 2 HEART TRANSPLANT OR IMPLANT OF HEART ASSIST SYSTEM W/O MCC 4 $ 129,344 3 ECMO OR TRACH W MV 96+ HRS OR PDX EXC FACE, MOUTH & NECK W MAJ O.R. 104 $ 124,462 4 TRACH W MV 96+ HRS OR PDX EXC FACE, MOUTH & NECK W/O MAJ O.R. 127 $ 64,498 5 LIVER TRANSPLANT W MCC OR INTESTINAL TRANSPLANT 6 $ 109,294 8 SIMULTANEOUS PANCREAS/KIDNEY TRANSPLANT 1 $ 128, TRACHEOSTOMY FOR FACE,MOUTH & NECK DIAGNOSES W MCC 7 $ 37,122 $ Estimated - Annual 12 TRACHEOSTOMY FOR FACE,MOUTH & NECK DIAGNOSES W CC 20 $ 23,365 Impact: 13 TRACHEOSTOMY FOR FACE,MOUTH & NECK DIAGNOSES W/O CC/MCC 3 $ 14, INTRACRANIAL VASCULAR PROCEDURES W PDX HEMORRHAGE W MCC 8 $ 66, INTRACRANIAL VASCULAR PROCEDURES W PDX HEMORRHAGE W CC 2 $ 50,611 $5,421, INTRACRANIAL VASCULAR PROCEDURES W PDX HEMORRHAGE W/O CC/MCC 2 $ 33, CRANIO W MAJOR DEV IMPL/ACUTE COMPLEX CNS PDX W MCC OR CHEMO IMPLANT 32 $ 39, CRANIO W MAJOR DEV IMPL/ACUTE COMPLEX CNS PDX W/O MCC 13 $ 24, CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES W MCC 92 $ 32, CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES W CC 53 $ 21, CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROCEDURES W/O CC/MCC 51 $ 15, SPINAL PROCEDURES W MCC 12 $ 38, SPINAL PROCEDURES W CC OR SPINAL NEUROSTIMULATORS 23 $ 21, SPINAL PROCEDURES W/O CC/MCC 15 $ 15, VENTRICULAR SHUNT PROCEDURES W MCC 6 $ 30, VENTRICULAR SHUNT PROCEDURES W CC 21 $ 15, VENTRICULAR SHUNT PROCEDURES W/O CC/MCC 24 $ 10,378 1 $ 6,394 $ 3,983 62% 34 CAROTID ARTERY STENT PROCEDURE W MCC 3 $ 24, CAROTID ARTERY STENT PROCEDURE W CC 5 $ 15, EXTRACRANIAL PROCEDURES W MCC 23 $ 23, EXTRACRANIAL PROCEDURES W CC 41 $ 11, EXTRACRANIAL PROCEDURES W/O CC/MCC 78 $ 6, PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W MCC 21 $ 25, PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W CC OR PERIPH NEUROSTIM 23 $ 12,753 2 $ 9,321 $ 6,865 73% 42 PERIPH/CRANIAL NERVE & OTHER NERV SYST PROC W/O CC/MCC 10 $ 10, SPINAL DISORDERS & INJURIES W CC/MCC 11 $ 10,490 1 $ 1,913 $ 8,577 18% 53 SPINAL DISORDERS & INJURIES W/O CC/MCC 1 $ 5, NERVOUS SYSTEM NEOPLASMS W MCC 54 $ 9,359 1 $ 3,824 $ 5,535 41% 55 NERVOUS SYSTEM NEOPLASMS W/O MCC 32 $ 7, DEGENERATIVE NERVOUS SYSTEM DISORDERS W MCC 67 $ 10,643 5 $ 10,511 $ % 57 DEGENERATIVE NERVOUS SYSTEM DISORDERS W/O MCC 203 $ 7, $ 7,488 $ 7,189 97% 58 MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA W MCC 4 $ 10, MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA W CC 9 $ 6,246 1 $ 3,338 $ 2,908 53% 60 MULTIPLE SCLEROSIS & CEREBELLAR ATAXIA W/O CC/MCC 18 $ 4,741 1 $ 2,728 $ 2,013 58% 61 ACUTE ISCHEMIC STROKE W USE OF THROMBOLYTIC AGENT W MCC 12 $ 19, ACUTE ISCHEMIC STROKE W USE OF THROMBOLYTIC AGENT W CC 21 $ 12,755 18

10 Questions? Thank You! Colleen Hall Senior Manager, Crowe Horwath Dr. Stephen Crouch Physician Advisor, Advocate Good Samaritan Hospital 19

11 Using Observation and Inpatient Metrics to Optimize Net Reimbursement HFMA ANI 2014 Number Action Item Due Date Responsible Party