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Assignment Exercise 4–1 Contractual Allowances Physician office.docx
- 1. Assignment Exercise 4–1:Contractual Allowances Physician office revenue for visit code 99214 has a full established rate of $72.00. Of 10 different payers, there are 9 different contracted rates, as follows: Payer Contracted Rate FHP $35.70 HPHP 58.85 MC 54.90 UND 60.40 CCN 70.20 MO 70.75 CGN 10.00 PRU 54.90 PHCS 50.00 ANA 45.00 Rates for illustration only. Required · 1. Set up a worksheet with four columns: Payer, Full Rate, Contracted Rate, and Contractual Allowance. · 2. For each payer, enter the full rate and the contracted rate. · 3. For each payer, compute the contractual allowance. The first payer has been computed below:
- 2. Full Contracted Contractual Payer Rate (less) Rate (equals) Allowance FHP $72.00 $35.70 $36.30 Example 4B: RevenueSources and Grouping Revenue Sources of healthcare revenue are often grouped by payer. Thus, services might be grouped as follows: · Revenue from the Medicare Program (payer = Medicare) · Revenue from the Medicaid Program (payer = Medicaid) · Revenue from Blue Cross Blue Shield (payer = Commercial Insurance) · or · Revenue from Blue Cross Blue Shield (payer = Managed Care Contract) Assignment Exercise 4–2: Revenue Sources and Grouping Revenue The Metropolis Health System (MHS) has revenue sources from operations, donations, and interest income. The revenue from operations is primarily received for services. MHS groups its revenue first by cost center. Within each cost center the services revenue is then grouped by payer.Required · 1. Set up a worksheet with individual columns across the top for six revenue sources (payers): Medicare, Medicaid, Other
- 3. Public Programs, Patients,Commercial Insurance, and Managed Care Contracts. · 2. Certain situations concerning the Intensive Care Unit and the Laboratory are described below. Set up six vertical line items on your worksheet, numbered 1 through 6. Six situations are described below. For each of the six situations, indicate its number (1 through 6) and enter the appropriate cost center (either Intensive Care Unit or Laboratory). Then place an X in the column(s) that represents the correct revenue source(s) for the item. The six situations are as follows: · (1) ICU stay billed to employee’s insurance program. · (2) Lab test paid for by an individual. · (3) Pathology work performed for the state. · (4) ICU stay billed to member’s health plan. · (5) ICU stay billed for Medicare beneficiary. · (6) Series of allergy tests run for eligible Medicaid beneficiary. Headings for your worksheet: Medicare Medicaid Other Public Programs Patients Commercial Insurance Managed Care Contracts (1) (2)
- 4. (3) (4) (5) (6) Example 4B: RevenueSources and Grouping Revenue Sources of healthcare revenue are often grouped by payer. Thus, services might be grouped as follows: · Revenue from the Medicare Program (payer = Medicare) · Revenue from the Medicaid Program (payer = Medicaid)
- 5. · Revenue fromBlue Cross Blue Shield (payer = Commercial Insurance) · or · Revenue from Blue Cross Blue Shield (payer = Managed Care Contract) Assignment Exercise 4–2: Revenue Sources and Grouping Revenue The Metropolis Health System (MHS) has revenue sources from operations, donations, and interest income. The revenue from operations is primarily received for services. MHS groups its revenue first by cost center. Within each cost center the services revenue is then grouped by payer.Required · 1. Set up a worksheet with individual columns across the top for six revenue sources (payers): Medicare, Medicaid, Other Public Programs, Patients, Commercial Insurance, and Managed Care Contracts. · 2. Certain situations concerning the Intensive Care Unit and the Laboratory are described below. Set up six vertical line items on your worksheet, numbered 1 through 6. Six situations are described below. For each of the six situations, indicate its number (1 through 6) and enter the appropriate cost center (either Intensive Care Unit or Laboratory). Then place an X in the column(s) that represents the correct revenue source(s) for the item. The six situations are as follows: · (1) ICU stay billed to employee’s insurance program. · (2) Lab test paid for by an individual. · (3) Pathology work performed for the state. · (4) ICU stay billed to member’s health plan. · (5) ICU stay billed for Medicare beneficiary. · (6) Series of allergy tests run for eligible Medicaid beneficiary. Headings for your worksheet: Medicare Medicaid Other Public Programs Patients
- 6. Commercial Insurance Managed CareContracts (1) (2) (3) (4) (5)
- 7. (6) Example 5B Study thechapter text concerning grouping expenses by diagnoses and procedures. Refer to Exhibits 5–3 and 5–4 (about major diagnostic categories), Exhibit 5–5 (about DRGs and MDCs), and Table 5–1 (about procedure codes) for examples of different ways to group expenses by diagnoses and procedures.Assignment Exercise 5–2 Required Find a listing of expenses by diagnosis or by procedure. The source of the list can be internal (within a healthcare facility of some type) or external (such as a published article, report, or survey). Comment upon whether you believe the expense grouping used is appropriate. Would you have grouped the expenses in another way? Exhibit 5–3 Major Diagnostic Categories MDC 1 Diseases and Disorders of the Nervous System MDC 2 Eye MDC 3 Ear, Nose, Mouth, and Throat MDC 4 Respiratory System MDC 5 Circulatory System MDC 6 Digestive System MDC 7 Hepatobiliary System and Pancreas
- 8. MDC 8 Musculoskeletal Systemand Connective Tissue MDC 9 Skin, Subcutaneous Tissue, and Breast MDC 10 Endocrine, Nutritional, and Metabolic MDC 11 Kidney and Urinary Tract MDC 12 Male Reproductive System MDC 13 Female Reproductive System MDC 14 Pregnancy, Childbirth, and the Puerperium MDC 15 Newborns and Other Neonates with Conditions Originating in the Perinatal Period MDC 16 Blood and Blood-Forming Organs and Immunological Disorders MDC 17 Myeloproliferative and Poorly and Differentiated Neoplasms MDC 18 Infections and Parasitic Diseases (Systemic or Unspecified Sites) MDC 19 Mental Diseases and Disorders MDC 20 Alcohol/Drug Use and Alcohol/Drug-Induced Organic Mental Disorders MDC 21 Injuries, Poisoning, and Toxic Effect of Drugs MDC 22 Burns MDC 23 Factors Influencing Health Status and Other Contacts with Health Services
- 9. Exhibit 5–4 HospitalDepartmental Code List Based on Major Diagnostic Categories 1 Nervous System 2 Eye 3 Ear, Nose, Mouth, and Throat 4 Respiratory System 5 Circulatory System 6 Digestive System 7 Hepatobiliary System 8 Musculoskeletal System and Connective Tissue 9 Skin, Subcutaneous Tissue, and Breast 10 Endocrine, Nutritional, and Metabolic 11 Kidney and Urinary Tract 12 Male Reproductive System 13 Female Reproductive System 14 Obstetrics 15 Newborns 16 Immunology 17 Oncology 18 Infectious Diseases 19 Mental Diseases 20 Substance Use 21 Injury, Poison, and Toxin 22 Burns 23 Other Health Services 24 Special Drugs 25 HIV 26 Unassigned 59 Outpatient Exhibit 5–4 Hospital Departmental Code List Based on Major Diagnostic Categories 1 Nervous System 2 Eye 3 Ear, Nose, Mouth, and Throat
- 10. 4 Respiratory System 5Circulatory System 6 Digestive System 7 Hepatobiliary System 8 Musculoskeletal System and Connective Tissue 9 Skin, Subcutaneous Tissue, and Breast 10 Endocrine, Nutritional, and Metabolic 11 Kidney and Urinary Tract 12 Male Reproductive System 13 Female Reproductive System 14 Obstetrics 15 Newborns 16 Immunology 17 Oncology 18 Infectious Diseases 19 Mental Diseases 20 Substance Use 21 Injury, Poison, and Toxin 22 Burns 23 Other Health Services 24 Special Drugs 25 HIV 26 Unassigned 59 Outpatient Table 5–1 Example of Radiology Department Costs Classified by Procedure Code Procedure Code Procedure Description Department Cost 557210 Ribs, Unilateral $ 60,000 557230 Spine Cervical Routine 125,000
- 11.