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Reimbursement: Utilization rules

Philipsburg Mail of Philipsburg, Montana

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Living in a small community has a great deal of advantages and disadvantages. One such advantage is not only getting to know one's health care provider, but spending more time with them during ones medical appointment. Now, we have heard statements like, "we should be able to see our provider for as long as we want" or "you better never make them see more patients than they do now".

Once explained at a community meeting, Granite County Medical Center (GCMC) does not set the rules on its reimbursement; the Centers for Medicare and Medicaid Services (CMS) do. Prior to my arrival at GCMC on April 18, 2011, an audit was performed seeking to understand the productivity at each clinic and its consequences to the organization. Although, productivity is the "culprit," it all boils down to utilization of services. Below is a statement from Wipfli, a national auditing and financial firm. These are the rules to which a Rural Health Clinic, including Philipsburg and Drum-mond must adhere:

Medicare pays GCMC on a cost per visit basis for rural health clin-ic (RHC) services adjusted for the Medicare productivity standard. That standard requires mid-level practitioners (nurse practitioners and physicians' assistants) to provide 2,100 visits per year and physician's 4,200 visits per year. We generally find that mid-level practitioners meet the Medicare productivity standard; however, neither of the two rural health clinics operated by GCMC met the Medicare productivity standards in the year ending June 30, 2010.

The reduction in Medicare reimbursement to GCMC is identified on the annual Medicare cost report. For the year ended June 30, 2010, the Medicare cost report indicates that the actual cost per visit was $106.73 in Philipsburg and $166.58 in Drummond. Because the two clinics' practitioners did not meet the Medicare productivity standard, the actual Medicare reimbursement was reduced to $87.56 in Philipsburg and $131.28 in Drummond. Due to productivity issues within the clinics, the clinics' Medicare reimbursement was reduced by $17,164 in Philipsburg and $12,877 in Drummond, for a total loss of $30,041.

One way GCMC is assisted is through a levy that was passed, for up to $400,000 per year. My goal is to get GCMC off this levy and it has been my number one priority since my hire. So how does one propose this can happen-simple-increase revenue and at the same time decrease expense.

Please understand that GCMC cannot continue to do business as usual as it did the last few years and continue to exist. What I mean is, GCMC must first cease our dependence on grants. Grants are a great way to begin a program, however, the long term sustainability of that program should be thoroughly considered prior to applying for any grant. If proper vetting of a grant does not happen, then it means one is playing Russian roulette with tax payer dollars.

One caveat however: GCMC can bring in $10,000 in net revenue, but if patients chose to receive their care in other towns, when that service is offered at GCMC, then every dollar spent going out of town for healthcare services means those individuals are deducting from the net revenue and their dollars are infused into other communities-not Granite County. If you spend $100 in another county for healthcare, then that is $100 Granite County will never recoup.

Original Publication Date: January 19, 2012



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