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with the explosion in #COVID19 cases in NYC and around the country, you may be wondering what hospitals will be paid to treat these patients. in this thread i'll walk through how that's going to work.
i'll assume the hospital bills medicare: half of #COVID19 patients are 65+, other insurers often use the same or similar payment approaches, & hospitals might get medicare rates for uninsured patients under the CARES act. i'll account for the 20% payment bump in the CARES act too
i'll show prices for @nyphospital. to simplify things i assume:
1) the patient has a principal diagnosis–the underlying reason for their admission–of #COVID19
2) it's April 1 or later (no COVID-specific diagnosis code before then)
3) they don't have HIV & they aren't a newborn
1) the patient has a principal diagnosis–the underlying reason for their admission–of #COVID19
2) it's April 1 or later (no COVID-specific diagnosis code before then)
3) they don't have HIV & they aren't a newborn
if the patient gets no big procedures, by emergency @CMSGov rule they'll be classified "respiratory infections and inflammations" patients. for those in the know, that's diagnosis-related groups (DRGs) 177-179. @nyphospital payment ranges from $13K-$25K. let's narrow that down.
the payment for a respiratory infections & inflammations patient depends on whether they had a complication or comorbidity (called a CC). these are determined from other diagnoses on the bill.
no CC? $12K.
a CC (like chronic heart failure)? $17K.
a major CC (like sepsis)? $25k.
no CC? $12K.
a CC (like chronic heart failure)? $17K.
a major CC (like sepsis)? $25k.
on the other hand, about one-sixth of #COVID19 patients go to the intensive care unit, where they might go on a ventilator. if so, hospitals receive *much* higher payment. if the patient gets under 4 days of ventilator support it's $33K. if 4+ days of ventilator support, $74K.
patients on the ventilator long-term might get a tracheostomy. the hospital would be paid twice as much for that case: $148K.
very rarely, a #COVID19 patient could get ECMO, an incredible procedure that bypasses the heart & lungs: $242K, the 3rd highest payment DRG in Medicare.
very rarely, a #COVID19 patient could get ECMO, an incredible procedure that bypasses the heart & lungs: $242K, the 3rd highest payment DRG in Medicare.
these numbers aren't the last word. if a patient is very costly, hospitals get outlier payments for 80% of the costs beyond the medicare payment + a loss threshold (~$33K for @nyphospital). costs=charges on the bill deflated by a markup factor (called the cost-to-charge ratio).
these are all payment rates for @nyphospital. other hospitals might get paid more or less. each $ value i presented was (mostly) produced by multiplying a DRG "weight" (a standardized price) by area- and hospital-specific conversion factors. more info: http://www.medpac.gov/docs/default-source/payment-basics/medpac_payment_basics_16_hospital_final.pdf
now for the receipts.
half of #COVID19 patients 65+ https://gis.cdc.gov/grasp/COVIDNet/COVID19_3.html & https://www.kff.org/other/state-indicator/distribution-by-age/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D
other insurers pay like medicare: @zackcooperYale @stuartcraig @MartinSGaynor @johnvanreenen https://healthcarepricingproject.org/sites/default/files/Updated_the_price_aint_right_qje.pdf
CARES act to pay Medicare rates: https://www.nytimes.com/2020/04/03/upshot/trump-hospitals-coronavirus.html
half of #COVID19 patients 65+ https://gis.cdc.gov/grasp/COVIDNet/COVID19_3.html & https://www.kff.org/other/state-indicator/distribution-by-age/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D
other insurers pay like medicare: @zackcooperYale @stuartcraig @MartinSGaynor @johnvanreenen https://healthcarepricingproject.org/sites/default/files/Updated_the_price_aint_right_qje.pdf
CARES act to pay Medicare rates: https://www.nytimes.com/2020/04/03/upshot/trump-hospitals-coronavirus.html
receipts 2:
20% payment bump: https://www.aha.org/special-bulletin/2020-03-26-senate-passes-coronavirus-aid-relief-and-economic-security-cares-act
DRG rules for #COVID19 diagnoses: https://edit.cms.gov/files/document/icd-10-ms-drgs-version-371-r1-effective-april-1-2020-updated-march-23-2020.pdf & https://www.cms.gov/icd10m/version38-fullcode-cms/fullcode_cms/P0001.html
@ahahospitals coding guidelines: https://www.aha.org/fact-sheets/2020-03-30-frequently-asked-questions-regarding-icd-10-cm-coding-covid-19
17% of #COVID19 inpatients to ICU: https://www.cdc.gov/mmwr/volumes/69/wr/mm6913e2.htm
20% payment bump: https://www.aha.org/special-bulletin/2020-03-26-senate-passes-coronavirus-aid-relief-and-economic-security-cares-act
DRG rules for #COVID19 diagnoses: https://edit.cms.gov/files/document/icd-10-ms-drgs-version-371-r1-effective-april-1-2020-updated-march-23-2020.pdf & https://www.cms.gov/icd10m/version38-fullcode-cms/fullcode_cms/P0001.html
@ahahospitals coding guidelines: https://www.aha.org/fact-sheets/2020-03-30-frequently-asked-questions-regarding-icd-10-cm-coding-covid-19
17% of #COVID19 inpatients to ICU: https://www.cdc.gov/mmwr/volumes/69/wr/mm6913e2.htm
payment calculation:
i used @CMSGov PC Pricer software with provider number 330101 ( @nyphospital): https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PCPricer/inpatient
i assume patient has the average length of stay for their DRG. to reflect the CARES bump i add 20% to the payment (excluding the per diem & per stay parts).
i used @CMSGov PC Pricer software with provider number 330101 ( @nyphospital): https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PCPricer/inpatient
i assume patient has the average length of stay for their DRG. to reflect the CARES bump i add 20% to the payment (excluding the per diem & per stay parts).
also thanks @LorenAdler @michaelannica @allanmjoseph @jp_mcginnis who explained payment and clinical issues to me!
