Kaplan HCA 440 HCF Unit 3 Study Exam questions

Dr. Melissa Rose is trying to decide whether to be a Medicare-participating physician for the upcoming year. (Assume that her entire practice consists of Medicare patients or at least that her practice has slack capacity. Her Medicare patients do not displace non-Medicare patients.) Assume that her average charge is $120 (before Medicare’s limiting charge is applied), for which the average Medicare-approved amount is $100. If she decides to be a non-participating physician, she expects to accept assignment 80% of the time. For the unassigned patients assume that she would set her charges at 110 percent of the Medicare-approved fee for a nonparticipating physician. Assume that her Medicare patient volume is not reduced if she chooses not to participate nor if she does not accept assignment. (Ignore bad debt and any other factors not presented here.)

Non-Participating

	Participating	Assigned	Unassigned
Doctor Charge	$120	$120	$120
Medicare approved x participating factor	$100 1.0	$100 .95	$100 .95
Medicare allowed x MAC factor	$100 1.0	$95 1.0	$95 1.10
Max allowable charge	$100	$95	$104.50
Medicare Payment (80%) Patient Payment	$80 $20	$76 $19	$83.60 $20.90
Total allowed	$100	$95	$104.50

1. What will be Dr. Rose’s average reimbursement per visit if she chooses to be a Medicare-participating physician? (This is the total from both Medicare and the patients.)

2. What will be Dr. Rose’s average reimbursement per visit if she chooses not to be a Medicare-participating physician? (This is the total from both Medicare and the patients.)

A non-participating physician provides services to a Medicare patient who has total charges of $100 (before Medicare’s limiting charge is applied). The physician does not accept assignment, charges the maximum allowable, and submits the claim to Medicare. Assume Medicare’s approved schedule for these services is $80.

	Unassigned
Doctor charge	$100
Medicare approved x participating factor	$80 .95
Medicare allowed x MAC factor	$76 1.15
Max allowable charge	87.40
Medicare payment (80%) Patient Payment	$69.92 $17.48
Total allowed	$87.40

3. What is the Medicare portion of the physician payment (which Medicare sends to the patient)?

4. What is the patient’s portion of the payment to the physician (net of the reimbursement from Medicare?

The Medical College of Virginia, located in the urban city of Richmond, Virginia, has a wage index of 1.8579. A student from nearby Virginia Commonwealth University has just been treated for viral meningitis during a 5-day length of stay (LOS) (DRG weight: 1.535).

Rate Table

Hospital Status Labor Non-labor

Urban Areas 2,800 1,250

Rural Areas 2,000 1,000

5. Use the information in the rate table to calculate the DRG operating payment for this treatment. Payment = DRG weight x [(Labor amount x wage index) + Non-labor amount]

6. Assuming that the wage index remains the same as in question 13, what would the DRG operating payment be if the same treatment occurred in the rural Pulaski County Hospital in Pulaski, VA?

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