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Tip of the Week: Perform a financial impact analysis of the 2008 proposed OPPS rule

APCs Weekly Monitor, October 5, 2007

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Hugh E. Aaron, MHA, JD, CPC, CPC-H, senior vice president of compliance and regulatory affairs/regulatory counsel for HCPro, Inc., located in Marblehead, MA, says that performing a financial analysis is the first step that a hospital should taken when determining how the expanded packaging aspect of the 2008 OPPS proposed rule will affect its operation.

Hospitals know what types of services they provide, and it's a matter of running their service mix through an OPPS pricer, Aaron says. "The impact analysis could result in a hospital making some strategic changes to its service mix," he adds.

Aaron does caution, however, that hospitals may not choose to drop a service even when it is not financially viable. In those instances, it may still choose to emphasize or deemphasize certain services.

To determine whether your hospital should consider changes to its service mix, look to your decision support team and business office for analysis, Keith Siddel, MBA, PhD (c), president and CEO of HRM, in Creede, CO suggests, "Initially, hospitals will be scared away from analyzing the impact and building financial models, but it's really the only way they'll know what their impact is going to be and what to expect in the coming year and, of course, ultimately, how to set their budgets," he says.

(The above tip appeared in the October 2007 issue of Briefings on APCs).

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