WSR 00-19-091

EXPEDITED ADOPTION

DEPARTMENT OF

LABOR AND INDUSTRIES

[ Filed September 20, 2000, 10:33 a.m. ]

Title of Rule: Hospitals, WAC 296-23A-0500 When does a case qualify for high outlier status?

Purpose: Update WAC 296-23A-0500 to reflect current procedures for payment of high outlier cases under the department's hospital inpatient prospective payment system.

Statutory Authority for Adoption: RCW 51.04.020, 51.04.030.

Statute Being Implemented: RCW 51.36.080.

Summary: This change will remove language stating that hospitals must enter a condition code on bills in order to be paid for high outliers (cases in which the hospital's costs are unusually expensive as defined in rule). It is no longer necessary for hospitals to enter the condition code because the department's medical information payment system (MIPS) can automatically recognize high outlier cases.

Reasons Supporting Proposal: The proposal eases the administrative burden on hospitals to be paid appropriately for their services, without adding any additional burden or cost to the department.

Name of Agency Personnel Responsible for Drafting: Marilyn Gisser, Tumwater, (360) 902-6801; Implementation and Enforcement: Doug Connell, Tumwater, (360) 902-4209.

Name of Proponent: Department of Labor and Industries, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: WAC 296-23A-0500 contains language describing the procedure hospitals billing the department under its inpatient prospective payment system must follow for an inpatient bill to be considered for high outlier status by the department. The language is incorrect because the bill form has changed since the rule was adopted. Furthermore, there is no technical or policy reason for hospitals to have to indicate that a bill should be considered for high outlier status, since the department's medical information payment system (MIPS) can be programmed to automatically recognize high outlier cases. This rule will save hospitals the administrative burden of coding bills to be considered for high outlier payment and assure that all bills that qualify for high outlier payment are paid appropriately. It will not change L&I operations or costs. The proposal will not affect hospital bills covered by self-insured employers or the crime victims compensation program.

Proposal Changes the Following Existing Rules: Deletes sentence "To have a bill considered for outlier status, a hospital must enter "61" for the condition code, block 35 of the hospital billing form" from rule describing when a case qualifies for high outlier status.

Reason(s) Expedited Adoption of the Rule is Appropriate: The rule complies with RCW 34.05.356 because it only corrects typographical errors, makes address or name changes, or clarifies language of a rule without changing its effect (RCW 34.05.356 (1)(c)).

NOTICE

THIS RULE IS BEING PROPOSED TO BE ADOPTED USING AN EXPEDITED RULE-MAKING PROCESS THAT WILL ELIMINATE THE NEED FOR THE AGENCY TO HOLD PUBLIC HEARINGS, PREPARE A SMALL BUSINESS ECONOMIC IMPACT STATEMENT, OR PROVIDE RESPONSES TO THE CRITERIA FOR A SIGNIFICANT LEGISLATIVE RULE. IF YOU OBJECT TO THIS RULE BEING ADOPTED USING THE EXPEDITED RULE-MAKING PROCESS, YOU MUST EXPRESS YOUR OBJECTIONS IN WRITING AND THEY MUST BE SENT TO Selwyn Walters, Department of Labor and Industries, P.O. Box 44001, Olympia, WA 98504-4001 , AND RECEIVED BY November 20, 2000.

The proposed adoption date is December 1, 2000.


September 20, 2000

Gary Moore

Director

OTS-4388.1


AMENDATORY SECTION(Amending WSR 97-06-066, filed 2/28/97, effective 4/1/97)

WAC 296-23A-0500
When does a case qualify for high outlier status?

Outlier payments apply only to diagnosis-related-group (DRG) reimbursed cases with unusually high or low costs. Outlier status does not apply to cases paid using a percent of allowed charges (POAC) factor or per diem rates. ((To have a bill considered for outlier status, a hospital must enter "61" for the condition code, block 35 of the hospital billing form.))

A case is considered a high cost outlier if the costs for the case exceed the outlier threshold for the assigned diagnosis-related-group. The costs for a case are determined by multiplying the allowed charges for the case by the hospital specific POAC factor. The threshold used to define a high outlier case is the greater of a dollar threshold of twelve thousand dollars or two standard deviations above the state-wide average cost for each DRG paid by the department.

The dollar threshold may be adjusted annually for inflation or other factors as determined by the department. The standard deviations for DRGs will be computed from all relevant cases in the historical data base, excluding statistical outliers.

[Statutory Authority: RCW 51.04.020, 51.04.030 and 51.36.080. 97-06-066, 296-23A-0500, filed 2/28/97, effective 4/1/97.]

Washington State Code Reviser's Office