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State-level review of hospital rates has been around for more than 20 years, but it remains one of the most debated forms of hospital regulation. In this first half of two-part article, selected rate review programs are examined.
We are revising the Medicare inpatient hospital prospective payment system to implement necessary changes arising from legislation and our continuing experience with the system. In addition, in the addendum to this final rule, we are describing changes in the amounts and factors necessary to determine prospective payment rates for Medicare inpatient hospital services. We are also setting forth the new target rate percentages for determining rate-of-increase limits for hospitals and hospital units excluded from the prospective payment system. This final rule also responds to the comments we received concerning changes to hospital payments made in a January 7, 1991 final rule with comment. These changes include midyear changes to the inpatient hospital prospective payment system that implemented several provisions of section 4002 of the Omnibus Budget Reconciliation Act of 1990. In addition, this final rule responds to comments received concerning changes in the procedures and criteria of the Medicare Geographic Classification Review Board (MGCRB) that were set forth in a June 4, 1991 final rule with comment period.
Every organized payment system must contain its costs in order to keep within revenue without denying benefits. Fixed expenditure caps requiring the provider to operate within its annual financial grant can be imposed on organizations like hospitals, but are fiercely resisted by the medical profession. All financial arrangements with doctors are negotiated, including systems of fixed expenditure caps and more flexible expenditure targets. If the doctors accept the principle of caps and cooperate in achieving them, they do so only as part of a negotiated settlement to avoid a worse outcome. Government's power is minimized, even when government is the payer. Caps on the physicians' sector are unusual. Instead, we see the spread of flexible targeting systems, wherein cost overruns are compensated for by lower expenditure targets the following year. Medical associations in all countries resisted even these restraints for years, but eventually accepted them, provided that target setting, judgments of overruns, utilization control, and all other features are part of a joint negotiating system. Targeting systems are often complicated because they preserve the semiprivate character of statutory health insurance and they are the result of negotiated compromises. To succeed in controlling costs, they require the cooperation of the medical association and of the rank-and-file doctors--but they can succeed. The United States has enacted a small-scale targeting system for Medicare physician payments alone. It cannot become the method for universal health insurance, which must heed lessons from abroad. Only an all-payer system can cover an entire population and contain the costs of the system. A few government officials cannot dictate and implement expenditure goals, but a system of consultation is required for setting and carrying out targets. Impartial officials can regulate hospitals according to the guidelines produced by the consultations, but the record of the medical profession in the countries reviewed here is that they insist on negotiating the final rules and rates. Americans have become bewitched by the mirage of econometric formulas automatically governing a sector, but the real problem is to devise and operate a harmonious decision-making system.
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In the summer of 1999 the BDA conducted a Timings Inquiry in order to provide information on treatment timings within the General Dental Services (GDS) and to develop a model of an hourly rate for general practice. A panel of dentists measured the absolute time taken to carry out 21 key treatments. The relative times of related treatments were then estimated. The panel also came to consensus about the variables to construct the hourly rate model. The absolute timings exercise was applied to the hourly rate model in order to draw some conclusions about the average earnings of a full-time dentist committed to the NHS. This information formed a central part of the BDA's 1999 evidence to the Doctors and Dentists Review Body.
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Virginia Hospital Association should send a clear message to both the states and HCFA that Medicaid providers are entitled, as a matter of right, to challenge their Medicaid rates in federal courts on both substantive and procedural grounds. Accordingly, it is legally incumbent upon the states and HCFA to make the plan amendment process meaningful in terms of state submissions and HCFA's review and approval. Only direct provider participation can ensure this result.
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In this second half of a two-part article examining state-level review of hospital rates, the lessons of the past 20 years are discussed.
This final notice with comment period announces the final relative value units (RVUs) for Medicare payment for existing procedure codes under the physician fee schedule and interim RVUs for new and revised codes. Section 6102(a) of the Omnibus Budget Reconciliation Act of 1989, as amended by section 4118 of the Omnibus Budget Reconciliation Act of 1990, requires establishment of the physician fee schedule and periodic review and adjustment of the RVUs.
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Attention to reform of reimbursement for psychiatric inpatient services largely focuses on the use of prospective payment systems, e.g., payment based on diagnosis-related groups (DGRs), for hospitals. Recently, there also has been interest in proposals for altering physician reimbursement (inpatient and outpatient) by using physician DRGs, capitation models, or relative value scales instead of the charge-based, fee-for-service model. The authors review the resource-based relative value scale (RBRVS) as an option for psychiatry. The RBRVS uses the setting, the time spent, the difficulty in treating the patient, the training, and the psychiatrist's role to determine reimbursement rates.
This review of nursing home cost function research shows that certain provider and service characteristics are systematically associated with differences in the average cost of care. This information can be used to group providers for reasonable cost related rate-setting or to adjust their rates or rate ceilings. However, relationships between average cost and such service characteristics as patient mix, service intensity, and quality of care have not been fully delineated. Therefore, econometric cost functions cannot yet provide rate-setters with predictions about the cost of the efficient provision of nursing home care appropriate to patient needs. In any case, the design of reimbursement systems must be founded not only on technical information but also on public policy goals for long-term care.
OBJECTIVE: To develop a set of indicators for assessing the severity of rheumatoid arthritis (RA) through medical records. METHODS: A list of 47 potential indicators of RA was reviewed by an expert Delphi panel of 6 rheumatologists. The Delphi method is a formal approach for gathering expert opinion. The 47 potential indicators included items from the following 5 categories: radiologic and laboratory findings, clinical and functional status measures, extraarticular manifestations, prior surgical history, and medications. The panelists rated the potential indicators' relationship to RA disease severity. Each panelist rated each indicator on a scale of 0-6, in which 0 indicated no relationship at all with severe RA and 6 indicated a perfect relationship with severe RA. After a baseline set of ratings, a literature review was distributed to the panelists along with the panel's initial mean ratings and the ranges. The panelists then met to discuss the literature and rerate all indicators. RESULTS: After repeat ratings and review of relevant literature, the panel rated 28 of 47 (60%) potential indicators as having a strong or very strong relationship to severe RA. These 28 indicators were drawn from all 5 categories of potential indicators. There was agreement among the panelists on ratings for 41 of 47 indicators. Agreement was defined as a range of scores among the panelists </=3. CONCLUSION: A Delphi panel of rheumatologists agreed that data generally available in medical records may serve as potential indicators of severe RA.
Review how a hospital's financial department builds inpatient room and board charges.
This report summarizes State legislated efforts to control rising hospital costs and the status of these efforts in May 1982. The abstract for each of 17 State programs summarizes key legislative features and operating aspects. The States included in this report are: Arizona, California, Connecticut, Florida, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Oregon, Rhode Island, Virginia, Washington, West Virginia, and Wisconsin, The abstracts focus on programs requiring the disclosure, review, or legislation of hospital rates and budgets.