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Privacy Act of 1974; matching program--HCFA. Notice of a matching program--the Internal Revenue Service (IRS), the Social Security Administration (SSA), and HCFA--disclosure of IRS taxpayer identity and filing status information to be matched with SSA earned income information for Medicare beneficiaries and their spouses.

As required by Section 6202 of the Omnibus Budget Reconciliation Act of 1989 (OBRA 1989), Public Law 101-239, the Department of Health and Human Services is providing public notice that the IRS and the SSA will disclose certain information regarding the taxpayer identification and filing status and the earned income of Medicare beneficiaries and their spouses for HCFA's use in identifying Medicare secondary payer (MSP) situations. This will enable HCFA to seek recovery of identified mistaken payments that were the liability of another primary insurer or other type of payer. The matching report set forth below is in compliance with the Computer Matching and Privacy Protection Act of 1988 (Pub. L. No. 100-503).

Centers for Medicare and Medicaid Services, U.S.↗

Coverage, technology assessment, and the courts.

Coverage decisions by third-party payers are relying more and more heavily on the conclusions of technology assessment programs about the safety and effectiveness of technologies applied in specific clinical situations. Assessment programs vary markedly in the sophistication and rigor of their methodology. Payers differ as to how such assessment information is integrated into their decision-making processes. Finally, coverage decisions about a specific technology can vary widely across the country.

Blue Cross Blue Shield Insurance Plans↗

How hospital medical record departments can benefit from retrospective DRG review.

DRGs and PPS have had a major, negative effect upon hospital reimbursement. Hospitals now focus upon methods for improving and increasing reimbursement from third-party payers. More payers are using DRG-based reimbursement methods. DRG payment review offers a viable solution to the problems brought by stringent payment plans and has potential benefits for the MRD as well. MRD directors should investigate DRG payment review alternatives and from such efforts, attempt to maximize the benefits to the hospital and their own departments. Success with DRG payment review identifies the MRD as an objective, results-oriented revenue generator and, thereby, can improve performance throughout the hospital and among the medical staff.

Diagnosis-Related Groups↗

Investigational: what's in a name.

The term "investigational" has become the fulcrum upon which coverage decisions turn. All third-party payers, including the federal government, use varying definitions of the term for the purpose of excluding treatments from coverage for payment. Unfortunately, no consistent definition of the term is available to payers to guide them in their coverage decisions.

American Medical Association↗

Financial trends for urban Catholic hospitals.

To identify some of the reasons for the declining financial health of hospitals in large urban areas, staff from the Catholic Health Association's Department of Research and Information gathered data on such factors as average total profit margins, Medicare PPS margins, payer mix, and deductions from revenue between 1982 and 1989. In addition, the study tracked such indicators as occupancy, admissions, average payment period, and days in accounts receivable. Location and local community context were also studied. Based on the data, the study classified 28 of the 125 Catholic hospitals in large urban areas as "consistently sound," another 27 as "adversely affected," and 14 as "losing ground." The study compared these groups to one another, as well as to a group of nine Catholic hospitals from large urban areas that had closed by 1988. The study revealed that, despite differences in financial performance, consistently sound and adversely affected hospitals exhibited a number of similarities. Over the period covered, for example, the two groups had similar occupancy and received similar percentages of gross patient revenue from Medicare patients, third-party payers, and self-paying patients. Adversely affected hospitals contributed a significantly greater proportion of their resources to care for the poor. Consistently sound hospitals, on the other hand, had significantly fewer families below the poverty line, lower unemployment, and fewer nonwhite residents in their local communities.

Bed Occupancy↗

Taxation of nonprofit hospitals: a cost impact model.

At a time when taxing authorities at all levels of government are reexamining present exemptions, nonprofit charitable hospitals may become concerned about potential new tax liabilities. The Tax Impact Model described here can predict the dollar amount of new taxes, the probable amount of shortfall in major payers' reimbursement for these expenses, and the resulting net financial impact. This model incorporates a set of issues that should be considered and factors for which data or assumptions are needed. It can be applied to hospitals singly or in groups. Here, the model's application to a single hospital shows that payer mix and pretax financial strength are important determinants of the impact of taxation. These findings also suggest that hospitals with a large disproportion of Medicare and Medicaid patients, and those with small revenue margins, are least able to absorb new tax expenses.

Charities↗

Whither private health insurance? Self-destruction or rebirth?

The American public increasingly finds itself disenchanted with the system for health care financing in this country. Three forms of reform proposal are examined: those that place the locus of primary responsibility for health insurance coverage on the individual, those that would rely on employer mandates with patients and government bearing the residual responsibility, and those that lodge chief financial responsibility with the government, and act as primary agent for cost control. The second approach, government-mandated employer-provided health insurance, appears to be the most politically viable at this time. However, that option is likely to be acceptable to the business community only if the mandate is coupled with additional regulation of private health insurance. Specifically, private health insurance in such a system likely would be based on mandatory open enrollment, community-rated premiums, and all-payer reimbursement, under which every payer pays a given provider the same fee for the same service.

Consumer Behavior↗

The German health care system: a model for hospital reform in the United States?

Experience in Germany illustrates that the United States could potentially achieve universal access, comprehensive and high-quality services, and value for the money expended with what is often referred to as a "quasi-private and quasi-public" health care system. The German hospital system is analyzed from a number of perspectives, and it is concluded that this approach has some advantages over a single-payer, monolithic-type national health insurance model. This is primarily because of its pluralistic prepayment system and because the commencement of reimbursement negotiations are without direct governmental intervention. The adoption of the German design in the United States, it is concluded, would result in a sharp change in policy direction from a conceptually procompetitive, market-driven hospital environment to a highly federally regulated, state-administered one. The implementation of the German approach in this country would also require a shift from managed care plans and other third party payers having to micromanage the use of health care services for individual patients to tightly centralized national and state fiscal controls (e.g., institutional global capital and operating budgets) targeted at providers.

Cost-Benefit Analysis↗

RBRVS: old concepts, bad press.

As health care finance has changed from a system of cash from patients to third-party reimbursement, a variety of mechanisms have been devised to bring equity to the payment process. The latest payment mechanism for this purpose is the resource-based relative value scale system implemented by Medicare, which is now being adopted by other third-party payers. However, too many payers are pushing for discounts from providers at the point of adoption of the system, thus foiling the equity aspect of the system.

Medicare Part B↗

Trends in cardiac care: contractions, concentration, collaboration.

Cardiovascular services is entering an age of contraction and concentration. The number of programs and the growth in inpatient procedures have topped out and the presence of significant excess capacity has become apparent. During the next five years, there will be heightened pressures to simultaneously decrease the overall number of cardiac procedures performed and, on the part of individual providers, increase procedure volume in order to achieve economies of scale and high levels of quality. It is likely that the number of health care organizations with OHS programs and PTCA may be cut to 500 by the year 2000, significantly influencing the redistribution of cardiac services along regional lines. The public, government, and private payers have embarked on a quest for value; and in the future they will only purchase services from providers demonstrating high-quality outcomes and average, or below average, charges. HCFA's Cooperative Cardiovascular Project is typical of the direct continuous quality improvement and management initiatives that will be implemented to monitor appropriateness, outcome quality, and resource utilization through the application of clinical practice guidelines (CPGs) and data on the treatment of AMI, PTCA, and CABG surgery. A more indirect, managed care approach by purchasers to obtaining higher value can be seen in the Medicare Participating Heart Bypass Center Demonstration project, the federal government's first big step into selective specialty care contracting for clinical service on a package price basis. Several different types of private initiatives have been used to achieve wider distribution of service while maintaining high program volumes and high-quality care through collaboration and the formation of interhospital linkages. Although some of these have included collaborative programs to encourage voluntary community-based planning and discourage the duplication of services, the payers demand for value (cost/quality) and the organizational leverage of the regional health alliances will accelerate the process and spur the formation of a smaller number of high-volume invasive programs. Large invasive programs will continue to formalize interhospital linkages to provide an integrated set of services in a layered system of cardiac care.(ABSTRACT TRUNCATED AT 400 WORDS)

Cardiac Catheterization↗

Managing provider networks through expert systems: use of patterns of treatment to address overutilization.

Among the most important contributors to rising health care costs is excess utilization of services. Sophisticated clinical criteria, encoded as an expert system in software, allow identification of probable excess utilization in large claims data sets. These systems can be used to adjudicate claims, resulting in direct cost savings, or to profile physicians and other providers, facilitating creation and maintenance of networks. These systems are used by traditional payers to promote quality, control costs, and enhance competitiveness and are beginning to be used by nontraditional payers, such as physician groups and hospital-based networks.

Ambulatory Care↗

Health reform in Germany. An American assesses the new operating efficiencies.

In 1993, responding to a $5.7 billion deficit among the country's third-party payers, the German parliament imposed mandatory global budgets for physician, hospital, dental, and pharmaceutical services. Although Germany had been able to maintain health spending at a lower rate than the United States, an excessive supply of health resources was beginning to drive prices higher. During the three years the global budgets are in place, German third-party payers (the "sickness funds") and providers will implement several fundamental reforms. These include: Reducing excessive supply of specialists Constraining the acquisition and utilization of expensive medical technologies Reducing the annual number of physician visits per person Reducing average hospital length of stay Integrating community- and hospital-based physician services Reducing payroll deductions for mandated benefits The 1993 reforms also impose a budgetary cap at the 1991 expenditure level for drugs prescribed by community-based physicians. In addition, the reforms call for the implementation of community-rated premiums and stipulate that Germans be able to select their sickness fund each year. Although the reforms make important changes, they leave the basic German healthcare system intact. It is difficult to imagine, moreover, that any of the reforms being implemented will in the foreseeable future place any major element of the health system in serious financial peril; in fact, they will help preserve the system.

Budgets↗

Unleashing the potential of subacute care.

The emergence of subacute care as a legitimate setting for certain patients is attracting the attention of payers and providers in local delivery systems. The author suggests that incorporating subacute care within the continuum of services can have specific and immediate payoffs for payers and providers alike. The article explores alternative ways in which hospitals can provide subacute care and proposes an approach that involves the formation of a hospital subacute care organization with a long-term care provider.

Cost-Benefit Analysis↗

Consider all options when third-party benefits are paid in error.

For many healthcare providers, the greatest problem with third-party payers is getting them to pay the benefits they are contractually obligated to pay. However, another problem that arises consistently--thought less frequently--is what to do when a third-party payer provides benefits that it is not contractually bound to make and then demands the payment be refunded. One answer to this problem may be to just say "no."

Income↗

Health plans and providers: how new partnerships are evolving in a volatile environment.

As the fee-for-service health system dwindles, organized provider structures and mutually beneficial relationships are forming between providers and payers. Providers and payers--united by shared goals of efficiency and effectiveness of care--are beginning to work together to identify and achieve their financial and quality objectives. In this article, the author discusses the evolution of these relationships in health care delivery, addresses the challenges of integration, and reveals the winners in this new delivery system.

Capitation Fee↗

Utilization management, case management, and you.

Historically, most monitoring functions have been carried out by insurance companies. Monitoring costs was considered their fiduciary obligation to their customers. The exercise of this fiduciary obligation kept premiums low, while increasing or maintaining the benefit levels. Risk (the assumption of losses generated by services costing more than the income received from premiums) was assumed by the insurance company and eventually passed to the customer or the payer. Today, risk is being transferred more and more to the provider. This transfer was started by the creation of DRGs, the main purpose of which was to transfer risk from payers (insurance companies, employers, state and federal government, etc.) to provider health care organizations (physician groups, individual practitioners, hospitals, clinics, etc.).

Cost Control↗

Using case management to improve claims payment.

Payers increasingly are subjecting claims to intensive review in an attempt to control amounts paid for healthcare services. An internal case management program, however, can help providers better understand and respond to the review techniques employed by payers as well as streamline overall claims processing.

Accounts Payable and Receivable↗

New directions for Medicare payment systems.

This overview discusses articles published in this issue of the Health Care Financing Review, entitled "Medicare Payment Systems: Moving Toward the Future." These articles focus on the ongoing development of Medicare payment methodologies, their adoption by non-Medicare payers, and issues to be addressed in the development of all-payer systems based on these methodologies.

Long-Term Care↗