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Medicare Rules Make Offsite Organ Recovery Costly

Cheryl Clark, for HealthLeaders Media, March 26, 2014

Joe Weber, vice president of finance for CORE in Pittsburgh, says that Medicare should find a solution because pre-transplant service expenses would drop. "If we can save money to the transplant program, we would hope that would get passed on," he says.

Maurer, and several other hospital transplant finance experts, say that the complex Medicare cost report policy can be summarized like this:

Hospitals with transplant centers can add into their Medicare cost reports each year amounts spent for certain staff salaries, utilities, testing services, physician consult fees, the costs of surgeons who fly out to recover organs elsewhere, and transplant center square footage, anything that's determined to be a "pre-transplant service" cost.

A Complicated Cost Structure
But what percentage of those costs they can claim depends on how many organs those hospitals transplant into Medicare patients as well as how many organs are recovered from Medicare patients—but only if those organs are recovered on site.

For example, if 50 of the 100 organs a hospital transplanted were to go to Medicare patients, and the hospital recovered another 100 organs from donors, Medicare would see that as the hospital having 150 of its 200 "useable organs" benefitting Medicare beneficiaries. Therefore 150 of its 200 organs could be assigned a pre-transplant service for Medicare, and Medicare would reimburse the hospital 75%.

But if those 100 organs from brain-dead donors were recovered elsewhere, at an OPO surgical facility offsite, the hospital would be allowed to capture only 50% of its transplant costs (50% of 100). Those 100 donor organs could not be counted for Medicare payment.

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