Hospital Reimbursement: Concepts and Principles, 1st Edition (Hardback) book cover

Hospital Reimbursement

Concepts and Principles, 1st Edition

By Kyle Herbert

Productivity Press

272 pages

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pub: 2012-06-05
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Description

Due to the countless variables that affect revenue and cost, the hospital reimbursement process is by far the most complex of any industry. Requiring only a basic financial background and a working knowledge of accounting, Hospital Reimbursement: Concepts and Principles supplies a clear understanding of the concepts and principles that drive the revenue cycle within a hospital setting.

The book explains the technical aspects of reimbursement in language that is easy to comprehend. It illustrates the complexities of the hospital revenue cycle and explains the Medicare and Medicaid financial models in detail. The text also addresses the Medicaid reimbursement methodology, the formulation of the Medicare blend rate, the computation of both DSH and IME, as well as other third-party payers. It also:

  • Covers the full range of services and procedures for which a hospital can receive reimbursement
  • Explains the difference between a for-profit and not-for-profit hospital
  • Contains chapters devoted to Statements of Operations (Income Statement) and Statements of Financial Position (Balance Sheet)
  • Examines governmental cost reporting—including Worksheets A, A-6, A-8, A-8-2, B-1, B Part 1, C Part 1, D-3, D-5, and E Part A

Supplying readers with a foundation in coding principles, the text also includes a model for calculating the financial impact of variations in patient length of stay. It discusses the DRG and APC reimbursement models and details the computation of an outlier payment. In addition, it walks the reader step-by-step through the creation of a mock Medicare cost report for a sample hospital.

Table of Contents

Fundamentals of Accounting

Introduction

History and Framework

Accounting Services

Auditing

Financial Concepts and Terminology

Additional Financial Terms

Financial Statements

Budgeting

Cost Accounting

Inventory Management

Sensitivity Analysis

Relative Sales Value

Other Ratios

Conclusion

References

Types of Hospitals/Conceptual Framework

History and Introduction

Not-for-Profit Hospitals

Unrelated Business Income

For-Profit Hospitals

Government-Owned Hospitals

Board of Directors

Senior Management

Certificate of Need

Hospital Consolidation

Conclusion

References

Hospital Revenue Cycle

Introduction

Patient Access

Billing

Revenue Sources (Payers)

Payer Mix

Medical Records

Case Management/Utilization Review

Cash Collections

Hospital Contracting

Fraud/Abuse

Recovery Audit Contractors

Form 990

Conclusion

References

Hospital Services

Introduction

Inpatient/Outpatient

Facility/Professional Fee

Emergency Room

Surgery

Cardiology

Women’s Services/Birthing Unit

Neonatal Intensive Care Unit

Oncology

Radiology

Pharmacy

Laboratory

Observation Days

Nursing Homes, Skilled Nursing Facility, Hospice Care

Home Health Care

Administrative Days/Swing Beds

Osteopathic Medicine

Conclusion

Medicare

Introduction and History

Cost Sharing

Inpatient Prospective Payment System/Diagnosis-Related Group

Outpatient Prospective Payment System/APC Fee Schedule

Case Mix Index

Medicare Blend Rate

Medicare Disproportionate Share Add-On

Indirect Medical Education Add-On

Capital Portion of the Blend Rate

Outlier Payments

Medicare Pass-Through

Medicare Eligible Days

Additional Issues

Conclusion

Medicaid

Introduction

Reimbursement

Medicaid Add-On Payments

Medicaid Teaching Supplement and Trauma

Hierarchy of Indigent Patients

Medicaid Cost Settlement

Medicaid Disproportionate Share Calculation

State Children’s Hospital Insurance Program

Conclusion

Other Insurance Providers

Introduction

Managed Care (Health Maintenance Organization versus Preferred Provider Organization)

Blue Cross/Blue Shield

TRICARE

Workers’ Compensation

Veterans Affairs

Conclusion

References

Governmental Cost Reporting

Introduction

Worksheet A

Worksheet A-6

Worksheet A-8

Worksheet A-8-1

Worksheet A-8-2

Worksheet A-7

Worksheet B-1

Worksheet B Part 1

Worksheet B Parts 2 and 3

Worksheet C

Worksheet D

Worksheet E

Medicare Bad Debt

Medicare DSH Calculation

Worksheet E Part A

Worksheet E Part B

Subprovider (Psychiatric and Rehabilitation)

Clinics

Conclusion

Statement of Operations (Income Statement)

Introduction

Gross Revenue

Net Revenue

Other Revenue

Operating Expenses

Bad Debt

Responsibility Accounting

Variance Analysis

Payroll

Conclusion

Statement of Financial Position (Balance Sheet)

Introduction

Cash

Accounts Receivable

Inventories

Investments

Property and Equipment (Fixed Assets)

Accounts Payable

Long-Term Debt

Other Liabilities

Net Assets

Statement of Changes in Net Assets

Statement of Cash Flows

Financial Statement Notes

Conclusion

Reference

Coding

Introduction

Charge Description Master

Inpatient Coding

Outpatient Coding

Pricing

Charge Flowchart

Coding Accuracy

Conclusion

Managing the Month-End Close Process

Reference

Calculating the Financial Impact of Hospital Length of Stay

Introduction

Hospitalist LOS

Conclusion

Reference

The Future of Healthcare Accounting

Introduction

Job Security

Accountable Care Organization

Patient-Centered Care

Bundled Payments

Conclusion

Epilogue

Incorporating Faith in the Workplace

Appendix A: UB-04 Revenue Codes

Appendix B: FYE 2010 Medicare MS-DRG Listing

Index

About the Author

Kyle Herbert has over 18 years of healthcare accounting experience, and he is licensed as both a CPA (certified public accountant) and a CMA (certified management accountant). Kyle is a received his undergraduate degree from the University of Richmond and his master’s degree in business administration from The Citadel. In addition to these academic achievements, Kyle attained fellowships with both the Healthcare Financial Management Association and the American College of Healthcare Executives.

Kyle is a member of the American Institute of Certified Public Accountants, the Institute of Management Accountants, the South Carolina Society of Accountants, and the South Carolina Association of CPAs.

Mr. Herbert is also a Fulbright Scholar who was a visiting professor in Bangkok, Thailand.

He can be reached with questions or comments at: Columbia-17@hotmail.com

Subject Categories

BISAC Subject Codes/Headings:
BUS041000
BUSINESS & ECONOMICS / Management