High Deductible Provisions Cause For An Increase

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High-deductible provisions cause for an increase in sensitivity towards hospital prices as it relates to outpatient procedures. Managed care organizations are interested in price if they will have to make a payment, thus causing them to be very sensitive. This is how contract negotiations can become effected and payers choosing to discontinue their use with the network. Once there is more transparency about hospitals due to the internet, this can cause a dominion effect leading to more confusion, thus making pricing data less meaningful. For example, comparing charges at an encounter and procedure level can be confusing if you don’t know what to look for. In the case presented in the article, the encounter is more meaningful due to…show more content…
According to Cleverley (2003), utilizing selective pricing can display a 20-50% improvement in places where recovery is needed. Determining the impact of price changes can be accurately tested with a revenue and usage summary. This is a fallacy that can be widely accepted when using either previous method for pricing. There are three types of categories to keep in mind the current CDM (which is the charge master), at least 9 months of claims that have line-item information, and the payer contracts. All of the information can indicate factors for where a price should fall. The first indication that is made is why certain codes are not as frequent as others. This can aid in waste reduction since hospitals will be able to verify where services can reduce their use and the recovery rate (percentage of a charge increase that is recovered as profit). The second indication is used in combination with the other two categories. Having at least 9 months’ worth of information to work with can show trends within the line items that are determining an increase or decrease in price. The myth of price changes that was mentioned is in reference to line item pricing and can be found within the revenue and usage summary and actual line-item detail. The revenue and usage do not address the impact of claim-level provisions such as outliers and carve-outs (which are important in terms
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