Measuring real case mix change under medicare's prospective payment system

Beginning October 1, 2000, as required by the Balanced Budget Act (BBA) of 1997 and related amendments, Medicare began to reimburse home health agencies for home health services under the new Home Health Prospective Payment System (HHPPS). Under HHPPS, all home health costs for services including medical supplies are paid using a basic unit of payment known as the 60-Day Episode. The amount of the payment is calculated using a national standardized rate, adjusted for case mix and a wage index based on the site of service. For 60-Day Episodes beginning and ending in 2008, the Medicare HHPPS national standardized rate was updated by a new 153 case mix grouping and a new wage index value determined by the site of service for the patient.  The August 29,2008 ( 72 FR 49792) and November 30, 2008( 72 FR 67656) Federal Registers discuss the “Home Health Prospective Payment System Refinement and Rate Update For Calendar Year 2008” changes which include a rebasing and revising of the home health market basket resulting in new labor portion percentage of 77.082 and non-labor portion percentage of 22.918, the new LUPA (Low Utilization Payment Adjustments) per visit payment amounts, the inclusion of an  additional payment for NRS ( Non-Routine Supplies), elimination of the SCIC(Significant Change In Condition) payment, and adjustments to PEP ( Partial Episode Payment) and Outlier payments. This paper discusses an overview of the updated 2008 Medicare HHPPS national standardized rate for CY 2009.

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Description of Case-Mix Adjusters by the Severity of Illness Working Group of The Society of Hospital Epidemiologists of America (SHEA)

Infection Control and Hospital Epidemiology ◽

10.1086/645860 ◽

1988 ◽

Vol 9 (7) ◽

pp. 309-316 ◽

Cited By ~ 4

Author(s):

Peter A. Gross ◽

B. Eugene Beyt ◽

Michael D. Decker ◽

Richard A. Garibaldi ◽

Walter J. Hierholzer ◽

...

Keyword(s):

Clinical Outcome ◽

Infection Control ◽

Diagnosis Related Groups ◽

Single Case ◽

Prospective Payment System ◽

Payment System ◽

Insurance Companies ◽

Case Mix ◽

Medical Illness ◽

Prospective Payment

AbstractHospitals, insurance companies, and federal and state governments are increasingly concerned about reducing patient cost expenditures while maintaining high quality patient care. One method of reducing expenditures has been to tie hospital reimbursement with a prospective payment system based on diagnosis-related groups (DRGs). However, reimbursement under the DRG system is not acceptable for all patients in all hospitals because it is neither an accurate predictor of costs nor of clinical outcome. This deficiency poses significant problems for hospitals because DRGs are used nationwide as the prospective payment system for inpatients covered by Medicare. Several case-mix adjusters have been proposed to modify DRGs to improve their accuracy in predicting costs and outcome. We reviewed five of the most widely available indices: Acute Physiologic and Chronic Health Evaluation (APACHE II), Coded Disease Staging, Computerized Severity Index (CSI), Medical Illness Severity Group System (MEDISGROUPS), and Patient Management Categories (PMC). Recommendations for the use of a single case-mix adjuster cannot be made at this time because all indices have not been compared in sufficiently diverse settings and because some are better predictors of costs while others are better predictors of clinical outcome. Hospital epidemiologists and other infection control practitioners should be informed about these indices and their potential applications as they expand their role beyond infection control problems to issues concerning cost containment, quality assurance, and reimbursement.

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