Tip of the Week: Examine your facility's drug pricing
APCs Weekly Monitor, February 1, 2008
Want to receive articles like this one in your inbox? Subscribe to APCs Weekly Monitor!
Hospitals should examine how they are pricing drugs and other services. Examine the drug cost and determine whether your hospital has properly marked it up, even if it's a high-cost drug, because CMS uses charges from provider claims data to determine what it will pay in future years.
When hospitals use inappropriately low costs, no markups, or certain caps, this drives some of the lower-than-expected APC payment rates. Providers should spend some time reviewing this and possibly even removing some existing caps related to their markups.
CMS uses provider charge data and reduces it to cost, using the provider's cost-to-charge ratio from the cost report. CMS then sums this up across all providers who billed the drug. If the computed cost for a drug is below the $60 median cost drug packaging threshold, then CMS packages the drug (with a few exceptions). If it's above the threshold, then CMS generates a separate payment.
(The above tip was excerpted from the February issue of Briefings on APCs).
Want to receive articles like this one in your inbox? Subscribe to APCs Weekly Monitor!
Comments
0 comments on “Tip of the Week: Examine your facility's drug pricing ”
Related Products
Most Popular
- Articles
-
- Q/A: Volume requirement for reporting hydration services
- Featured blog post: Nurses face felony charges after reporting physician to the Texas Medical Board
- Catch up on what's new with injections and infusions
- Identify potential Medicaid RAC target areas
- HIPAA Q&A: Level of encryption needed for email
- Topic: CMS, OESS post new security compliance review information, checklist
- Capturing all necessary codes for IUD insertion and removal can be challenging
- What does case-mix index mean to you?
- OB services: Coding inside and outside of the package
- QA:Coding multiple initial infusions
- E-mailed
-
- Q/A: Volume requirement for reporting hydration services
- Featured blog post: Nurses face felony charges after reporting physician to the Texas Medical Board
- HIPAA Q&A: Level of encryption needed for email
- Q&A: Follow CMS' coding guidelines when using modifier -25
- What does case-mix index mean to you?
- Catch up on what's new with injections and infusions
- CMS has reformulated payments for some bilateral procedures
- New conflicts of interest create new challenges
- Q/A. One injection code or two?
- ED-to-inpatient transfers are flawed with safety gaps
- Searched