 RY 2010 SHORT-STAY OUTLIER PAYMENT CALCULATION EXAMPLE (412.529(c)(2))						
						
This is an example of how to calculate the RY 2010 estimated LTCH PPS adjusted payment 						
amount for a short-stay outlier (SSO) case of an amount payable under subpart O computed 						
as a blend of an amount comparable to the hospital inpatient prospective payment system (IPPS) per						
diem amount  and the 120 percent of the MS-LTC-DRG specific per diem payment (see 412.529(c)(2)(iv)).  						
						
This example uses the following assumptions:						
"1) The LTCH has 80 beds, "						
"2) The LTCH patient has a covered length of stay of 8 days,"						
"3) And covered charges of $45,501."						
						
						
Variable Name 	Variable Abbreviation	Variable Value	Notes			
Comparable IPPS Wage Index Value	WI_IPPS	1.0385	CBSA = 16974 (See Tables 4A and 4B of the FY 2010 IPPS rates notice (74 FR 44085 - 44091)).			
Comparable IPPS Geographic Adjustment Factor (GAF) Value	GAF	1.0262	CBSA = 16974 (See Tables 4A and 4B of the FY 2010 IPPS rates notice (74 FR 44085 - 44091)).			
DSH Percent	DSH_PCT	0.1962	Medicaid Percent = 14.23% and SSI Percent = 5.39%			
IR-To-Beds Ratio	IRB_RATIO	0.0011	Interns/Residents = 0.09 and   Beds = 80			
IR-To-ADC Ratio	IR_ADC	0.0019	Interns/Residents = 0.09 and  ADC = 47.66			
Cost-To-Charge Ratio	CCR	0.311				
Cost Of Living Adjustment Factor	COLA	1.000				
						
100 PERCENT OF COST CALCULATION:						
Estimated Cost  = Covered Charges x CCR						
"                                = $45,501 x 0.311"						
	"$14,150.81"					
						
120 PERCENT OF PER DIEM AMOUNT CALCULATION:						
MS-LTC-DRG Per Diem = Full LTC-DRG Payment / Average Length of Stay of the LTC-DRG*						
	"= $45,175.85 (for calculation see Table; 74 FR 44030) / 26.6 days"					
	"$1,698.34"	per day				
Per Diem Amount = MS-LTC-DRG Per Diem x Covered Days x 1.2						
	"= $1,698.34 x 8 days x 1.2"					
	"$16,304.06"					
 *The FY 2010 ALOS for MS-LTC-DRG 28 is 26.6 days (see 74 FR 44183).						
						
FULL MS-LTC-DRG PAYMENT (for calculation see Table; 74 FR 44030):						
	"$45,175.85"					
						
"BLEND ALTERNATIVE (i.e., A BLEND OF AN IPPS COMPARABLE PER DIEM AMOUNT AND 120% OF THE MS-LTC-DRG PER DIEM AMOUNT:"						
" 120% of the MS-LTC-DRG Per Diem Amount = $16,304.06 (see above)"						
 Percentage of the 120% MS-LTC-DRG Per Diem Amount = Covered LOS  SSO Threshold*						
	 = 8 days / 22.2 days					
	 = 0.36 percent					
     * SSO Threshold is calculated as 5/6ths ALOS of MS-LTC-DRG 28 (22.2 days).						
  MS-LTC-DRG Per Diem Portion of the Blend Alternative = 						
	120% of the MS-LTC-DRG Per Diem Amount x MS-LTC-DRG Per Diem Amount Percentage					
	"= $16,304.06 x 0.36"					
	"$5,869.46"					
  Full Comparable IPPS Payment Amount = Operating PPS + Capital PPS Payment						
    Operating PPS Payment = ((Labor-Share Standardized Amount* x WI_IPPS) +						
                                                         (Non Labor-Share Standardized Amount* x COLA)) x						
                                                         (IPPS MS-DRG Relative Weight**) x (1 + IME_OP*** + DSH_OP****)						
"                                   = (($3,593.52 x 1.0385) + ($1,629.62 x 1.000)) x (5.1090) x (1 + .0005 +.055)"						
"                                   = (($3,731.87) + ($1,629.62)) x (5.1090) x (1.0555)"						
"                                   = $28,912.10"						
"     * National Adjusted Operating Standardized Amount, Labor/NonLabor If Wage Index Greater Than 1 (Table 1A; 74 FR 44031)"						
    **The FY 2010 IPPS relative weight for MS-DRG 28 is 5.1090 (74 FR 44126).						
     *** Operating IME Calculation (FY 2010) = 1.35 x (((1+IRB_RATIO ) ^0.405) -1)						
                                                                   = 1.35 x (((1+0.0011) ^ 0.405) -1) 						
                                                                   = 1.35 x ((1.0011 ^ 0.405) -1) 						
                                                                   = 1.35 x ((1.0004) -1) 						
                                                                   = 1.35 x 0.0004						
                                                     IME_OP  = 0.0005						
     **** Operating DSH Calculation (FY 2010) - DSH% >= 15% and <= 20.2% located in an Urban area & with < 100 beds:						
                                                                  = lesser of 0.12 or (((DSH_PCT - 0.15) x 0.65)+ 0.025)						
                                                                  = lesser of 0.12 or (((0.1962 - 0.15) x 0.65)+ 0.025)						
                                                                  = lesser of 0.12 or (((0.0462) x 0.65)+ 0.025)						
                                                                  = lesser of 0.12 or ((0.0300)+ 0.025)						
                                                                  = lesser of 0.12 or (0.055)						
                                                 DSH_OP  = 0.055						
"(Note, in general, a hospital's operating IPPS DSH adjustment is based on its urban/rural location, number of beds and its DSH_PCT (which must be at least 15%)."						
    Capital PPS Payment = (Capital Federal Rate*) x (IPPS MS-DRG Relative Weight**) x (GAF)  x						
                                                        (COLA_CAP***) x (1 + IME_CP**** + DSH_CP*****)						
                                   = (($429.26) x (5.1090) x (1.0262) x (1.000) x (1 + 0.0005 + 0))						
                                   = (($429.26) x (5.1090) x (1.0262) x (1.000) x (1.0005))						
"                                   = $2,251.67"						
     * Capital Standard Federal Payment Rate (Table 1D; 74 FR 51499)						
    **The FY 2010 IPPS relative weight for MS-DRG 28 is 5.1090 (74 FR 44126).						
     ***Capital COLA factor calculation = 1+ (0.3152 x (COLA - 1); see (412.316(c)).						
     **** Capital IME Calculation (FY 2010) = (e ^ (0.2822 x IR_ADC)) - 1						
                                                                   = (2.7183 ^ (0.2822 x 0.0019)) - 1						
                                                                   = (2.7183 ^ ((0.0005)) - 1						
                                                                   = 1.0005 - 1						
                                                     IME_CP  = 0.0005						
     ***** Capital DSH Calculation (FY 2010) - located in an Urban area & with < 100 beds:						
                                                 DSH_CP  = 0.00						
"(Note, in general, hospitals must be located in an urban area & have 100 or more beds to receive an adjustment for capital DSH under the IPPS, regardless of its DSH_PCT (i.e., there is no minimum DSH_PCT) ---- if this LTCH would have had 100 or more beds, its DSH_CP would have been calculated as (e^ (0.2025 x DSH_PCT) - 1) = (2.7183 ^(0.2025 x 0.1962) - 1) = 0.0405."						
  Full  IPPS Comparable Payment Amount  = Operating PPS + Capital PPS Payment						
"                                                        = $2,8912.10 + $2,251.67"						
"                                                        = $31,163.77"						
  Comparable IPPS Per Diem Payment Amount = 						
                                                             Full IPPS Comparable Amount  IPPS ALOS MS-DRG 28 x Covered LOS						
	"                             = $31,163.77 / 10.2 days x 8 days"					
	"                             = $24,442.17"					
  IPPS Comparable Per Diem Amount To Be Used In Blend Alternative Calculation = 						
          Lesser of Comparable IPPS Per Diem Payment Amount or Full IPPS Comparable Payment Amount						
	"           = Lesser of $24,442.17 or $31,163.77"					
	"           = $24,442.17 "					
  Percentage of IPPS Comparable Per Diem Amount = 1 - Percentage of MS-LTC-DRG Per Diem Amount						
	                       = 1 - 0.36					
	                       = 0.64					
  IPPS Comparable Per Diem Portion of the Blend Alternative = 						
                             IPPS Comparable Per Diem  Amount x IPPS Comparable Per Diem  Amount Percentage						
	"= $24,442.17 x 0.64"					
	"$15,642.99"					
  Blend Alternative =  MS-LTC-DRG Per Diem Amount Portion + IPPS Comparable Per Diem Amount Portion 						
	"    = $5869.46 + $15,642.99"					
	"$21,512.45"					
						
"For FY 2010, this case would be paid $14,150.81* since it is the least of the 4 alternatives (i.e., 100% of the estimated cost ($14,150.81); 120% of the LTC-DRG per diem ($16,304.06); the full MS-LTC-DRG payment ($45,175.85); or the blend alternative ($21,512.45)) under the SSO policy at 412.529(c)(2)."						
						
						
LTCH PPS HIGH COST OUTLIER CALCULATION:						
Outlier Threshold = LTCH PPS (SSO) Payment + Fixed-Loss Amount						
"Outlier Threshold = $14,150.81 + $18,425"						
"Outlier Threshold = $32,575.81"						
"Estimated Cost  = $14,150.81"						
"* Since the estimated costs of the case did not exceed the outlier threshold, this case would not receive an additional outlier payment.  "						
