chapter 7 workbook
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Principles of Healthcare Reimbursement and Revenue Cycle Management
Student Workbook
Chapter 7
Application and Data Analysis Exercises
Application and data analysis exercises are provided at three levels of understanding. Basic exercises
focus on Bloom’s Taxonomy levels 1 (remembering) and 2 (understanding). Intermediate exercises relate
to Bloom’s Taxonomy levels 3 (applying) and 4 (analyzing). Advanced exercises are presented at Bloom’s
Taxonomy levels 5 (evaluating) and 6 (creating). Intermediate and advanced exercises require critical
thinking and analysis of data or scenarios.
Beginner Exercises
1.
Matching (Level 1—Remembering)
Match the payment status indicator on the left with the description on the right. Reference table 7.1 for a
listing of payment status indicators.
Payment Status
Indicator (SI)
Answer
Description
A
T
APC payment reimbursement methodology: included in
New Technology APCs, discounted when multiple of this
SI appear on same claim, same day of service
C
J1
Comprehensive APC Payment: all services are packaged
with this SI
H
N
Packaged payment
J1
K
APC payment reimbursement methodology: drugs,
biologicals and radiopharmaceuticals that are not pass-
through eligible
K
Q1
Conditional APC payment: STV conditionally packaged
services
N
C
Inpatient only procedures
Q1
Q4
Conditional APC payment or via the Clinical Lab Fee
Schedule when applicable
Q3
A
Fee schedule payment: example is physical therapy
Q4
S
APC payment reimbursement methodology: included in
New Technology APCs, multiple procedure reduction does
not apply
S
V
APC payment reimbursement methodology: emergency
department encounters
T
H
Reasonable cost reimbursement methodology: Pass-
through devices with no copayment
V
Q3
Composite APC payment: APC 8004 Ultrasound
2.
Chapter 7 PPS Grid (Level 2—Understanding)
For this exercise use the Word file titled AB202019_Ch07_Payment System Grid.docx.
Complete the grid by using information provided in the textbook. Include a brief explanation for
each category rather than a “yes” or “no.” This grid may be used as a study guide for exams.
Intermediate Exercises
1.
Practice with APCs (Level 3—Interpreting)
This assignment is designed to give the student practice with understanding APC concepts,
groups, and payment rates. Students will use the most recent OPPS Addendum A and Addendum
B. Addendums A and B are located at
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/HospitalOutpatientPPS/Addendum-A-and-Addendum-B-Updates
.
INSTRUCTIONS:
Locate the most recent OPPS Addendum A and Addendum B on the
Medicare website.
1.
Using Addendum A, identify a set (example is Pathology) of surgical APCs that are paid
at the full rate. Exclude New Technology.
a.
Set:
Critical care (5041) or Trauma Response with Critical Care (5045)
b.
Status Indicator:
S
2.
Using Addendum A, identify a set (example is Airway Endoscopy) of surgical APCs that
are paid at a discounted rate when multiple procedures are performed. Exclude New
Technology.
a.
Set:
Level 1 – 5 Skin procedures (5051-5055)
b.
Status Indicator:
T
3.
In Addendum A, locate APCs 5111-5116. APC 5111 is SI T and the remaining APCS are
SI J1. How is SI J1 different from T?
SI J1: the hospital services payment is through comprehensive APC and not paid
separately.
SI T: the payment is under OPPS and are paid separately.
4.
Using Addendum B, locate five packaged codes/services from different areas of the code
set (i.e., not all five from anesthesia).
1.
X:
00100 - 00104
2.
X:
00550 – 0055T
3.
X:
43197 - 43200
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4.
X:
38207 - 38215
5.
X:
36005 - 36218
5.
Packaged services are not separately payable.
Are you surprised that any of the services
you identified in question #4 are not separately payable?
What statistics or measures are
impacted when a packaged service is provided during a clinic visit? For example, an
immunization provided during a clinic visit.
No, not surprised by not being separately payable.
6.
Using Addendum B, identify an inpatient-only procedure. Give a reason why this
procedure would be approved for the inpatient setting but not the outpatient setting.
Most of the inpatient setting procedures requires anesthesia for the procedure. A patient
cannot be outpatient and have anesthesia provided.
7.
Scenarios. Identify the APCs and payment status indicators (SIs) for each scenario
(Addendum B). Which APCs are not packaged and would yield reimbursement for the
facility?
a.
Repair of lower jaw fracture is performed (21470). X-rays of the jaw (70110) and
facial bones (70150) are performed. List the APCs and SIs. Which APC(s) are
separately payable?
APC
SI
21470 Repair of lower jaw fracture
5165
J1
70110 X-ray of jaw
5522
Q1
X-ray of facial bones
5522
Q1
None of these APCs are separately payable.
b.
Patient evaluated in the ED (99282) for a racoon bite to the arm. Rabies vaccine
was given to the patient (90471 and 90675). List the APCs and SIs. Which APC(s)
are separately payable?
APC
SI
99282 ED
5022
J2
90471 Immunization admin
5692
Q1
90675 Rabies vaccine IM
9139
K
None of these APCs are separately payable.
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c.
Patient has a dermatology appointment. The physician drains a pilonidal cyst
(10080) on the patient’s lower back near the tailbone. Local anesthesia is provided
(00300). Additionally, the physician removes a callus on the patient’s big right toe
(11055). Lastly, the physician removes 8 skin tags (11200). List the APCs and SIs.
Which APC(s) are separately payable?
APC
SI
10080 Drainage of pilonidal cyst
5071
T
00300 Anesthesia head/neck/trunk
N
11055 Trim skin lesion
5051
Q1
11200 Removal of skin tags
5051
Q1
Drainage of pilonidal cyst can be paid separately - SI T
8.
How could the facility/physician circumnavigate the APC packaging rules for scenario
7C in order to receive additional reimbursement?
Do procedures on separate days.
2.
Practice with OPPS Reimbursement and Cost (Level 4—Analyzing)
For this exercise, use the file titled AB202019_Ch07_Practice with OPPS Reimbursement and
Cost.xlsx. There are four tabs in this file: Example, ED Visit, Rural SCH, and Surgery. The first
tab, Example, provides an example for how to calculate reimbursement and cost for an outpatient
hospital claim. The remaining tabs provide three different claims, each with a different service
type or focus. For each claim use Addendum B (
https://www.cms.gov/Medicare/Medicare-Fee-
for-Service-Payment/HospitalOutpatientPPS/Addendum-A-and-Addendum-B-Updates
) to locate
the reimbursement rates by CPT code. Calculate Medicare reimbursement, total charges, and
total cost. Does the facility make a profit or incur a loss?
3.
Medicare Payment System Provisions (Level 4—Analyzing)
Prospective payment system rates are based on national “average” cost figures. Taking the
national
average cost into consideration, CMS sets base rates for each payment system. The payment
systems then add provisions or adjustments to the system to account for situations where the cost
of an individual encounter or service may be higher or lower than the national average.
Pick three provisions from the Medicare Hospital Outpatient Payment System discussed
in chapter 7. Discuss why each provision is needed. What would happen if the provision were
discontinued? How would this impact facilities or providers? How would this impact the
Medicare beneficiary?
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