Reported Variation in Hospital Billing Quality.

This study examines how US hospitals perform on billing quality measures, including legal actions taken by a hospital to collect medical debt, the timeliness of sending patients an itemized billing statement, and patient access to a qualified billing representative.

Economic factors converge: force hospitals to review pricing strategies.

The US hospital service price structures are complex and tend to be significantly higher than the actual cost to provide the service. Health care consumers have been given more authority to drive health care decisions. Transparency in health care is forcing hospitals to critically review and substantiate service prices. It is vital that US hospitals review their pricing strategies in order to continue as strong leaders in the health care market.

A better way to measure volume--and benchmark costs.

Equivalent patient units is a more reliable measure of a hospital's patient volume than adjusted discharges or adjusted patient days because it better accounts for both inpatient and outpatient volumes. Three elements are required to calculate equivalent patient units: equivalent discharges, equivalent visits, and the payment ratio. All of these elements are available through publicly available data, making it possible for hospitals to immediately adopt this new metric and, thereby, better understand their potential for savings.

Evaluating the Clinical Utility and Cost of Imaging Strategies in Adults with Newly Diagnosed Primary Intradural Spinal Tumors.

OBJECTIVE: In patients with new primary intradural spinal tumors, the best screening strategy for additional central nervous system (CNS) lesions is unclear. The goal of this study was to document the rate of additional CNS tumors in these patients. METHODS: Adults with primary intradural spinal tumors were retrospectively reviewed. Imaging strategy at diagnosis was classified as focused spine (cervical, thoracic, or lumbar), total spine, or complete neuraxis (brain and total spine). Tumor pathology, genetic syndromes, and presence of additional CNS lesions at diagnosis or follow-up were collected. RESULTS: The study comprised 319 patients with mean age of 51 years and mean follow-up of 41 months. In 151 patients with focused spine imaging, 3 (2.0%) were found to have new lesions with 2 (1.4%) requiring treatment. In 35 patients with total spine imaging, there were no additional lesions. In 133 patients with complete neuraxis imaging, 4 (3.0%) were found to have new lesions with 2 (1.5%) requiring treatment. There was no difference in the identification of new lesions (P = 0.542) or new lesions requiring treatment (P = 0.772) across imaging strategies. Among patients without genetic syndromes, rates of new lesions requiring treatment were 1.4% for focused spine, 0% for total spine, and 2.2% for complete neuraxis (P = 0.683). There were no cases of delayed identification causing risk to life or neurological function. Complete neuraxis imaging carried an increased charge of $4420 per patient. CONCLUSIONS: Among patients without an underlying genetic syndrome, the likelihood of identifying additional CNS lesions requiring treatment is low. In appropriate cases, focused spine imaging may be a more cost-effective strategy.

Out-Of-Network Billing And Negotiated Payments For Hospital-Based Physicians.

When physicians whom patients do not choose and cannot avoid can bill out of network for care delivered within in-network hospitals, it exposes patients to financial risk and undercuts the functioning of health care markets. Using data for 2015 from a large commercial insurer, we found that at in-network hospitals, 11.8 percent of anesthesiology care, 12.3 percent of care involving a pathologist, 5.6 percent of claims for radiologists, and 11.3 percent of cases involving an assistant surgeon were billed out of network. The ability to bill out of network allows these specialists to negotiate artificially high in-network rates. Out-of-network billing is more prevalent at hospitals in concentrated hospital and insurance markets and at for-profit hospitals. Our estimates show that if these specialists were not able to bill out of network, it would lower physician payments for privately insured patients by 13.4 percent and reduce health care spending for people with employer-sponsored insurance by 3.4 percent (approximately $40 billion annually).

Procedure to normalize data for benchmarking.

INTRODUCTION: The hospital billing system is usually the source for reporting activity counts used in benchmarking efforts. Because billing is associated with a specific procedure, benchmarking data are often reported as procedure-days, procedure-shifts, or procedure-hours. Normalizing (usually to procedure-days) is required when comparing data for benchmarking purposes. For an institution that uses hourly billing, simply dividing procedure-hours by 24 (or procedure-shifts by 2 or 3) will underestimate the procedure-days reported by a daily billing system, because daily billing systems use the convention that any fractional day of service is rounded up to the next higher day. The purposes of this study were: (1) to simulate sets of data and determine the expected error with conversion by simple division, (2) to derive a more accurate procedure for normalizing benchmarking data, and (3) to compare the new normalization procedure to simple division, using simulated and actual data. METHODS: A reference population of simulated patient data was created using a spreadsheet to generate random start times paired with actual procedure durations (eg, hours of mechanical ventilation) for 5,000 patients. The spreadsheet calculated "true" billable procedure-days and procedure-shifts from the simulated procedure-hours. Next, a resampling procedure was used to simulate the effect of submitting benchmarking data based on various numbers of patients. The resulting sets of data were used to examine the association between sample size and conversion error when converting from procedure-hours to procedure-days and to generate an alternative conversion procedure that uses linear regression to estimate procedure-days from procedure-hours. An additional regression equation was generated from actual patient data, using simultaneously recorded procedure-hours and procedure-days. The set of mean conversion errors for the 2 regression equations was compared using the Mann-Whitney rank sum test. RESULTS: In general, conversion errors (both systematic and random errors) were smaller with larger sample sizes and with longer service periods, approaching an asymptote at a sample size greater than about 20. Using division, the conversion errors for a sample size of 100 were +/-16% for hourly reporting, +/-11% for 8-hour shifts, and +/-8% for 12-hour shifts. The regression equations for conversion derived from simulated data were as follows. For hourly billing, procedure-days = +/-0.237 + (0.049) (procedure-hours). For 8-hour shifts, procedure-days = +/-0.205 + (0.372) (procedure-shifts). For 12-hour shifts, procedure-days = +/-0.114 + (0.541) (procedure-shifts). Using those regression equations, the conversion errors for a sample size of 100 were +/-1% for hourly reporting, +/-0.2% for 8-hour shifts, and +/-0.2% for 12-hour shifts. The regression equation (for hourly billing) derived from simulated data gave better results than did the equation derived from actual data (median error 0.39 vs +/-2.92, p = 0.013).

Hatch hunts for hospitals. Minnesota is now the main stage in U.S. debate over uninsured billing as a third group of hospitals sign pacts with state officials.

Minnesota has become the main stage in the debate over uninsured billing. Forthe third month in a row, state authorities have signed agreements with hospitals to expand discount programs and limit debt-collection efforts. The latest deal means about 75% of admissions there will be covered by such pacts. "We saw this as a positive response to a major public challenge," said Terence Pladson, left, of CentraCare.

Using measurement and feedback to reduce health care costs and modify physician practice patterns.

Rising health care costs coupled with an inability to determine what constitutes value in the delivery of health care services lead a group of Cincinnati health care purchasers to seek answers and solutions. The formation of a collaborative effort that includes both purchasers and providers is producing profound changes in the Cincinnati health care market. After one year in operation, data show a significant overall decrease in length of stay, a return to single-digit inflation, and intriguing changes in provider practice patterns.

Tightrope walk: setting defensible prices.

Resolving the conflict between generating a profit and keeping prices reasonable is critical to the financial welfare of the hospital industry. Four steps may make this resolution easier: (1) determine the level of profit required, (2) assess the reasonableness of current costs, (3) assess the reasonableness of current prices, and (4) negotiate more equitable payment arrangements.

What's it worth?

Patients without effective coverage frequently must pay charges for medical services that are higher than the hospital's contracted rates. A national survey of hospitals shows great variation in how charges are set and accommodations made for patients with low income. The government is taking a more active role in examining charging practices. Hospitals can take several steps to help stave off government intervention.