Case Management

CMW Mentor moment: Are you paying attention to your case mix index?

Case Management Weekly, October 21, 2009

This article was written by Loretta Olsen, RN, director of case management at Jennie Edmundson Hospital in Council Bluffs, IA. It is adapted from HCPro’s newest resource for hospital case managers——a free blog dedicated to connecting hospital case managers to industry pacesetters, peers, and best practices.
What is case mix index (CMI) and why, as a case manager, do I care?
Financial Management for Nurse Managers and Executives, Third Edition, published by Elsevier, defines CMI as the measurement of the average severity of illness of patients treated by a healthcare institution. CMI helps determine the dollar amount assigned to a diagnosis related group (DRG) for the Medicare population. Medicare assigns a dollar amount, which is partially determined by the CMI, for every facility.
Hospitals use the CMI to create a budget. If the actual CMI is lower than the budgeted CMI, incoming money for those DRGs will be less than expected. This creates an imbalance in hospital revenue. If the money coming in is less than planned, a financial fiasco is possible. Think of CMI as the yellow caution light that warns the hospital of any impending decrease in hospital income. The financial team and senior management monitor the CMI monthly. 

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