Facts: Between 1972 and 1982 Guernsey Memorial Hospital issued bonds to fund capital improvements. Three years later the hospital refinanced its bonded debt by issuing new bonds, resulting in saving $12 million in debt service cost but also causing an advance refunding/ defeasance loss of $672,581. Consequently, the hospital established that it was entitled to $314,000 of the loss as Medicare reimbursement. The issue in this case was not the $314,000, but the timing; The Hospital claimed that it was entitled to full reimbursement in one year (the refinancing year) however, the Secretary of the Department of Health and Human Services argued that the loss must be amortized over the life of the old bonds. The Secretary's argument was based on an informal Medicare reimbursement guideline, Medicare Provider Reimbursement Manual (PRM) §233 (Mar. 1993). The fiscal intermediary relied on PRM §233 and determined that the defeasance loss had to be amortized. The Provider Reimbursement Review …show more content…
§§ 413.20. By applying the above rule to the issue at question, application of GAAP is required only for reporting purposes and not for Medicare reimbursement determination. Hence, 42 C.F.R. § 413.20 requires providers to report their costs in accordance with GAAP, it does not require costs to be reimbursed in the year that they are reported. In other words, the regulation instructs the Secretary to establish methods for determining cost reimbursement. Therefore, cost reimbursement determination is established by the guidelines that are promulgated by the Secretary of HHS i.e. PRM §233. The Secretary’s guideline PRM §233 requiring that the costs are spread over a period of years is a reasonable implementation of the Secretary’s duty to avoid distortions in the reimbursement process. The Supreme Court of the U.S. decided that the defeasance losses should be
In this case, the reader learns that liquidity is a better than average. The ratio and cash on hand have been better than 2013 from the past years. Moreover, it shows that the hospital has a higher ability to meet its cash obligation because it has more security compared to other hospitals. Funding allows hospitals to control funds and limit investments. Not-for-profit organizations help provide more services and margin of safety. Therefore, creditors look for a margin of safety so that the community that financed a small portion of total financing can be returned to the owners by leveraging. Capitalization ratio measures the funds that were borrowed and the assets that have been used. The coverage ratio measures the number that time they fixed financial charges. The time's interest earned ratio shows the ability of the hospital to meet
Furthermore, uncertainty of new reimbursement models, diminishing reimbursement, and complicated compliance regulations are playing the role of a catalyst for streamlining the Chargemaster process in majority of healthcare organizations. A good example of these challenges was prompted by the Center for Medicare and Medicaid with the release of data and chargemasters from several healthcare facilities. The release of the chargemasters sends a wave shock across the healthcare industry as it depicts a huge price discrepancies among health care providers, and due to this exposure many healthcare organizations attempt to rectify their charges. The main purpose the CMS release the chargemasters was to encourage transparency in hospital’s billing
Court stated that “if a hospital functions as a business institution, by charging and receiving money for what it offers, it must be a business establishment also in meeting obligations it incurs in running that establishment.”
Springfield General Hospital (SGH) is committed to high quality healthcare for patients, and providing tools to support physicians, nurses and pharmacists. SGH leadership approved the computerized physician order entry (CPOE) system as a solution to reduce prescription errors, and the results of the CPOE project are disappointing. The data show increased prescribing errors after implementing the CPOE; resulting in increased costs for adverse drug events, rather than the planned cost reduction (Spector, 2013). This change management plan provides the SGH board of directors and executive management team pragmatic steps to increase quality for patients by assessing the root issue of hospital
With the passage of the Affordable Care Act (ACA), the Centers for Medicare and Medicaid Services (CMS) has initiated reimbursement based off of patient satisfaction scores (Murphy, 2014). In fact, “CMS plans to base 30% of hospitals ' scores under the value-based purchasing initiative on patient responses to the Hospital Consumer Assessment of Healthcare Providers and Systems survey, or HCAHPS, which measures patient satisfaction” (Daly, 2011, p. 30). Consequently, a hospital’s HCAHPS score could influence 1% of a Medicare’s hospital reimbursement, which could cost between $500,000 and $850,000, depending on the organization (Murphy, 2014).
General Practices Affiliates is considering an offer from Titus Lake Hospital to join under a provider leasing model. Under a provider leasing model, Titus Lake Hospital is purchasing General Practices Affiliates’ services. The practice will retain control of personnel, management, and practice policies. Titus Lake Hospital submitted financial reports to assure transparency during the lease agreement process. The following analysis will discuss whether Titus Lake hospital is a viable financial partner for General Practice Affiliates, possible implications of the lease, and recommendations.
The cost of Medical equipment plays a significant role in the delivery of health care. The clinical engineering at Victoria Hospital is an important branch of the hospital team management that are working to strategies ways to improve quality of service and lower cost repairs of equipments. The team members from Biomedical and maintenance engineering’s roles are to ensure utilization of quality equipments such as endoscope and minimize length of repair time. All these issues are a major influence in the hospital’s project cost. For example, Victory hospital, which is located in Canada, is in the process of evaluating different options to decrease cost of its endoscope repair. This equipment is use in the endoscopy department for gastroenterological and surgical procedures. In 1993, 2,500 cases where approximately performed and extensive maintenance of the equipment where needed before and after each of those cases. Despite the appropriate care of the scope, repair requirement where still needed. The total cost of repair that year was $60,000 and the repair services where done by an original equipment manufacturers in Ontario.
Hospitals were reimbursed using a fee-for-service standard, sanctioning all insurance companies to pay the same prices for hospital services offered by different providers. Due to removing restrictions on hospital prices, hospitals now negotiate reimbursement rates for each payer, thus, causing a substantially difference in prices among payers.
In recent times, healthcare organization across the nation are facing unprecedented challenges as they strive to improve the overall quality of care provided to their patient’s population, while improving their organization’s financial performance. Furthermore, uncertainty of new reimbursement models, diminishing reimbursement, and complicated compliance regulations are playing the role of a catalyst for streamlining the Chargemaster process in majority of healthcare organizations.
There are several errors that can occur in the billing and the coding process. When there’s a problem in the coding process it can cause rejected claims. Some of these problems consist of truncated coding, mismatch between the gender or age of the patient and the selected code when the code involves selection for either criterion, assumption coding (reporting items or services that were not documented, but that the coder assumes were performed), altering documentation after services are reported, coding without proper documentation, reporting services that are produces produced by unlicensed and or unqualified clinical personnel, coding a unilateral service twice instead of choosing the bilateral code, and not satisfying the conditions of coverage for a particular service. These errors can result in denials or payments being delay...
In 1983, the Medicare prospective payment program was implemented, which allowed hospitals to be reimbursed a set payment based on the patient’s diagnosis, or Diagnosis Related Groups (DRG), regardless of what treatment was provided or how long the patient was hospitalized (Jacob & Cherry, 2007).... ... middle of paper ... ... Case Management Related to Other Nursing Care Delivery Models.
Jacobson, P. (1999, July/August). Legal challenges to managed care cost containment programs: an intital assessment. Courts & Managed Care, 69-85.
Reimbursement programs are a part of the United States health care system and they represent a financial tool for providing cash flow to service physicians and hospitals. Often times, the competency to provide quality health care is to be contingent on the payment for the services given by physicians and hospitals. Physicians that take part in the managed care systems are reimbursed by several different methods for their services. The two most common methods are Fee-For-Service or Capitation. Managed health care has grown considerably within the health care industry and Physicians have faced several challenges in establishing and financing payment systems for services. On the daily in the news you will see or hear about the financial savings resulting from managed health care as well as the restrictions on patient freedom. Insurance risk seems to be one of the less talked about concerns in the movement toward providing health care and professionals often ponder about who should bear the risk of insurance fees. For providers reimbursement is an essential portion of the managed care system. In order for them to receive their incentives to provide that efficient quality care they need to be reimbursed
The two major components of Medicare, the Hospital Insurance Program (Part A of Medicare) and the supplementary Medical Insurance program (Part B) may be exhausted by the year 2025, another sad fact of the Medicare situation at hand (“Medicare’s Future”). The burden brought about by the unfair dealings of HMO’s is having an adverse affect on the Medicare system. With the incredibly large burden brought about by the large amount of patients that Medicare is handed, it is becoming increasingly difficult to fund the system in the way that is necessary for it to function effectively. Most elderly people over the age of 65 are eligible for Medicare, but for a quite disturbing reason they are not able to reap the benefits of the taxes they have paid. Medicare is a national health plan covering 40 mi...
According to the Delivering Health Care in America, cost shifting is a method used by insurance companies to balance inadequate payments, mostly to bridge the gap from low government reimbursement (Shi & Singh, 2015). Cost shifting is when private insurance companies charge people more to make up for the money they lose. Hospitals and other health care providers are able to compensated for the services they provide for uninsured patients by increasing payments to private insurance (Coughlin, Holahal, caswell& McGrath, 2014). Government programs such as, Medicare and Medicaid reimburse hospitals at a very low rate, according to Potter (2015) the only way hospitals can be able to keep providing care and make up for their looses