Table of Contents Previous Next

December 2016 Texas Medicaid Provider Procedures Manual

Inpatient and Outpatient Hospital Services Handbook : 3 Inpatient Hospital (Medical/Surgical Acute Care Inpatient Facility) : 3.7 Claims Filing and Reimbursement : 3.7.3 Inpatient Reimbursement : 3.7.3.4 Outliers

3.7.3.4
TMHP makes outlier payment adjustments to DRG hospitals for admissions that meet the criteria for exceptionally high costs or exceptionally long lengths of stay for clients who are 20 years of age and younger as of the date of the inpatient admission. If a client’s admission qualifies for both a day and a cost outlier, the outlier resulting in the higher payment to the hospital is paid.
Providers can view their day and cost outlier payment information for inpatient hospital claims on the Electronic Remittance and Status (ER&S) Report. The R&S Report reflects the outlier reimbursement payment and defines the type of outlier paid. To view the day and cost outlier payment information, providers, facilities, and third party vendors may need to update their 835 electronic file format. For information about how to update the 835 electronic file format, refer to the revised electronic data interchange (EDI) companion guide (ANSI ASC X12N 835 Healthcare Claim Payment/Advice-Acute Care Companion Guide) on the TMHP website at www.tmhp.com.
3.7.3.4.1
The following criteria must be met to qualify for a day outlier payment:
In compliance with 1 TAC §355.8052, all DRG inpatient hospital day outlier payments must not exceed the allowed cost for the service. All hospitals except in-state children’s hospitals, both day and cost outlier payments have been reduced by 10 percent.
TMHP calculates payments as follows:
1)
Calculate the allowed cost for the service (i.e., the cap amount) by taking the difference between the Tax Equity and Fiscal Responsibility Act (TEFRA) and DRG-payable amounts.
Take the lesser of the day outlier or the cap amount.
Reduce the day outlier by 10 percent for all hospitals except in-state children’s hospitals.
2)
Reduce the cost outlier by 10 percent for all hospitals except in-state children’s hospitals.
Reimbursement is made for day or cost outliers on claims that qualify. If a client’s admission qualifies for both a day and a cost outlier, the outlier resulting in the higher payment to the hospital is paid.
Example
 
Example amount
Calculate the allowed cost for the service (i.e., the cap amount) by taking the difference between the TEFRA and DRG payable amounts (in this example, $600.00).
Take the lesser of the day outlier or the cap amount (in this example it would be the day outlier of $500.00).
Reduce by 10 percent.
11.14 x Universal Mean ($6,505.52) = <amount A>
11.14 x SDA = <amount B>
1.5 x DRG Relative Weight x SDA = <amount C>
Cost threshold = The greater of <amount C> compared with (the lesser of <amount A> and <amount B>)
Allowed amount x reimbursement rate = TEFRA amount
TEFRA amount - cost threshold x 0.6 percent = cost outlier amount
The calculations in this example would result in one of the following payments:
If the claim qualifies for both the day outlier and cost outlier payment, the payment will be made up to $495.00, which is the greater of the day outlier or the cost outlier payment.

Texas Medicaid & Healthcare Partnership
CPT only copyright 2014 American Medical Association. All rights reserved.