Wiki Calculating a UCR for a DRG

[GretchenC123]

I am doing a bill audit for an IPPS for DRG 956 and on Find-a-code there are per diem amounts. Am I understanding correctly that the ancillary services are a daily charge and the ICU/Standard Room charges are total for the LoS? I am new at this so this may seem like a stupid question to some of you, but I want to make sure I understand correctly.

 

[sls314]

I am doing a bill audit for an IPPS for DRG 956 and on Find-a-code there are per diem amounts. Am I understanding correctly that the ancillary services are a daily charge and the ICU/Standard Room charges are total for the LoS? I am new at this so this may seem like a stupid question to some of you, but I want to make sure I understand correctly.

Basic DRG reimbursement information:

A DRG rate is determined by Base Rate x DRG Weight. Generally, that calculation would be the full reimbursement for an inpatient facility claim.

(I say "generally" because a payer contract can have carveouts for things like implants or high cost drugs. In that case, the reimbursement would the DRG rate + the carveout rate. Or the whole claim could be an outlier, which could result in additional payment on top of the DRG rate.)

There isn't really a UCR for a DRG rate - for a commercial insurer, you only need to know the contracted base rate, and then multiply that times the DRG weight. The information needed to calculate Medicare and Medicaid DRG rates can be found on the CMS website (Medicare) or the state's Medicaid website.

More specific to your audit...

Who is the payer? (Commercial insurance, Medicare, Medicaid, etc. If Medicaid, what state?)
Are you auditing the payment received to see if your claim was reimbursed correctly?
Or are you doing a charge audit to confirm that all of the charges on the claim are documented in the chart?

For any specific suggestions/guidance, I'd need a little more information to assist.

 

[GretchenC123]

I am comparing the billed with what is reasonable because we are a 3rd party insurance for the purposes of bodily injury. Usually the providers increase their billed amounts because they hope to make money. Our claimant's are usually represented by Plaintiff's attorneys

 

[sls314]

I am comparing the billed with what is reasonable because we are a 3rd party insurance for the purposes of bodily injury. Usually the providers increase their billed amounts because they hope to make money. Our claimant's are usually represented by Plaintiff's attorneys

Do you have a UB-04 or an itemized statement (or both)? Do you have a copy of the medical records?

A UB-04 is a facility claim form - for an inpatient stay, the UB-04 will have the aggregate facility charges rolled up by revenue code. The itemized statement will have the detailed description of each line item for the entire stay, from room and board charges down to a tablet of Tylenol. The itemized statement is probably going to be more useful to you for analysis than the UB-04, but it is good to have copies of both on hand.

If you're looking to determine whether charges billed are accurate for the patient's stay, you'd need someone who understands inpatient documentation to go through the chart and compare the documentation to the itemized statement. This would help ensure that every line item in the chart was documented and supported in the medical record. If itemized statement says that a dose of medication was given on a specific date, you'd expect to see that dose documented appropriately in the chart.

If you're looking for something to tell you whether $XX,XXX total billed charges are reasonable for DRG 956, that doesn't really exist to the best of my knowledge. (A national or regional average like that also wouldn't be terribly useful for evaluating a specific hospital stay for a specific patient, because there are so many variables. Dates of service, health of the patient, cost of providing care - these things can all vary widely.)

If you're looking to estimate what a reasonable payment to the provider for DRG 956 might be, you could price out the claim and use Medicare rates as a tool to negotiate a settlement. (Keep in mind that most commercial and other insurance types do pay more than Medicare. You shouldn't anticipate paying the provider exactly what Medicare would, of course - Medicare rates are a good reference because they are publicly available and commercial insurance rates aren't often readily available.)

 

[GretchenC123]

Yes I have both. I am a Legal Nurse Consultant so I have a good grasp on the medicals. I just haven't had much experience with the UB-04 (most of what I audit are chiro and pain intervention) The claimant was injured on the job and so WC paid for his treatment. I just need to compare what the providers billed and what is actually reasonable for purposes of negotiation. For example, the WC paid 6% of what was actually billed which is 1/5th of what Find-a-code has for the UCR. Does that make sense? I know that hospitals negotiate their payments with each commercial insurance carrier which is usually double what Medicare pays. It's all a numbers game.