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Inpatient Facility Coding & Compliance Alert

You Be the Coder:

Correctly Handling the Bill for Free Supplies

Published on Mon Dec 17, 2012

   Question: Our surgery department sometimes gets medical device packages for promotional purposes (such as "buy one/get one free" offers on packs of orthopedic screws). If the hospital purchases one pack and the other is free, how do we handle the billing? I want to understand how everything is accounted for from a reimbursement standpoint. Connecticut Subscriber Answer: In general, adjusting pricing, that is, using the standard markup formulas, for these free or discounted items would be preferable. When hospitals receive routine quantity discounts (for supplies such as catheters and IV solutions), the reduced costs are factored into the pricing. If the free or discounted items are special but limited promotions, it might not be feasible for the chargemaster coordinators keep track of free or discounted items relative to pricing. For the Medicare program, the critical element is the generation of cost-to-charge ratios (CCRs). Even if the pricing is not [...]
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