Health Information Management

Q&A: Setting a price for corneal tissue

APCs Insider, January 8, 2016

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Q: I have a follow-up question to an answer you gave early last year. The question was about reimbursement for the cost of corneal tissue. You stated “This line item should reflect the costs associated with the corneal tissue.” We have just started providing this service and are having a debate on what this statement means. I think we can apply our usual markup, but our cost accounting person thinks this means we can only pass along our invoice cost. What does it mean in regard to setting our price?
A: In reviewing the original answer, this may have been confusing. The statement means that you should use the cost associated with the processing, preserving, and transporting of the tissue when you set your charge. Medicare pays this service based on reasonable cost basis, which means that it applies the cost-to-charge ratio to the line item in order to determine what your cost for the service was. The standard markup can be used, but you want to be sure you use only the cost related to the corneal tissue and nothing else on that line item. This will ensure not only that you receive appropriate reimbursement, but that you also report the correct cost to the Medicare program.


Editor’s note: Denise Williams, RN, CPC-H, seniorvice president of revenue integrity services at Revant Solutions,in Fort Lauderdale, Florida, answered this question.

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