Sample Hospital Contract

 

Our readers may find this interesting. Below is a sample hospital contract rate page send to us by a major hospital chain. We have reviewed numerous PPO hospital contracts in the past several years, from multiple payers, and can tell our readers that all of them look almost exactly like the one posted below. Just fill in the blanks.

 

ATTACHMENT
SAMPLE HOSPITAL SCHEDULE
		Criteria	Rate	Legend
LINE	INPATIENT
1	Medical/Surgical			PD
2	ICU/CCU/NICU/PICU/TELE			PD
3	Obstetrics
4	Vaginal Delivery	1-2 days		FF
5	Vaginal Delivery with Sterlization and/or D&C	1-2 days		FF
6	C-Section Delivery	1-3 days		FF
7	C-Section Delivery with Sterilization and/or D&C	1-3 days		FF
8	Additional Day(s) Mother Only			PD
9	Normal Newborn			PD
10	Carve Outs/Pass-Throughs
11	Implants/Medical Devices			BC
12	Pharmaceutical Drugs			BC
13	Catastrophic
14	Threshold			BC
15	Payment Basis			BC
16	OUTPATIENT
17	All Outpatient			BC
LEGEND:
BC = Billed Charges
FF = Fixed Fee
PT = Per Treatment
PD = Per Diem

SAMPLE HOSPITAL FOOTNOTES
These footnotes are an integral part of the rate sheets
	Service	Description	MS-DRG(s)	Rev Code(s)	ICD-9 / CPT Code(s)
Line	INPATIENT
1	Medical/Surgical			100, 101, 110, 111, 112, 113, 114, 116, 117, 120, 121, 122, 123, 124, 126, 127, 130, 131, 132, 133, 134, 136, 137, 140, 141, 142, 143, 144, 146, 147, 150, 151, 152, 153, 154, 156, 157, 160, 164, 167, 169
2	ICU/CCU/NICU/PICU/TELE	(MICU, SICU, NICU, CICU) This rate applies to all days baby is in NICU.		172-174, 200-204, 206, 209-213, 214, 219
3	Obstetrics	If baby is admitted to NICU during specified length of stay, NICU rate will be paid in addition to case rate. OB case rates reflect pricing for the obstetrical service of delivering. Hence, payment of full amount of case rate will be made regardless of the status of the newborn.
4	Vaginal Delivery		768, 774, 775
5	Vaginal delivery with sterilization and/or D & C		767
6	C-Section Delivery		765, 766
7	C-Section delivery with sterilization and or D & C		765, 766		ICD-9 codes 66.2 – 66.4
8	Additional Day(s) Mother Only	This rate applies if Mother’s stay exceeds the case rate day criteria.
9	Normal Newborn	This rate is paid in addition to the Obstetric case rate.		170, 171, 179
10	Carve Outs/Pass-Throughs	Implants/Medical Devices and Pharmaceutical Drugs as defined below are reimbursed as an add-on to ALL services unless noted otherwise.
11	Implants/Medical Devices	Hospital will be paid for covered implants, medical devices, prosthetics, pacemakers, seed implants and stent(s), as an add-on to ALL services herein when billed with revenue codes 274, 275, 276, 278 and 279 identified on submitted UB forms at the specified BC percentage. No invoice is required.		274, 275, 276, 278 and 279
12	Pharmaceutical Drugs	Hospital will be paid for covered pharmaceutical drugs, as an add-on for ALL services herein when billed with revenue codes 252 or 636 identified on submitted UB forms at the specified BC percentage. No invoice is required.		252, 636
13	Catastrophic	For any case where total hospital charges are greater than the rate sheet threshold, reimbursement will be at the rate sheet specified percentage of BC effective from the first billed dollar for the entire case. Gross charges associated with Revenue codes 274, 275, 276, 278, 279, 252 and 636 as defined in the implant and pharmaceutical drug reimbursement sections are included in the Catastrophic Threshold calculation and shall be paid at the applicable Catastrophic Payment percentage of BC.
14	Threshold	The minimum amount of gross billed charges that qualifies a case for payment under the catastrophic clause.
15	Payment Basis	The percent of reimbursement applied to the total billed charges qualified by the threshold.
16	OUTPATIENT	Outpatient includes all services provided by hospital billed as outpatient. Implants/Medical Devices and Pharmaceutical Drugs as defined below are reimbursed as an add-on to ALL services. The Outpatient service categories below are additive unless noted otherwise.
17	All Outpatient	All services performed during the stay.

 

Editor’s Note: In our opinion, self-funded employer groups should negotiate directly with hospitals with the intent of paying a fair and reasonable rate agreed to by both parties. However, from the payer’s perspective, the following items need to be addressed: (1). Right to audit must be included (2). Outliers must be removed (3). Discounts off imaginary and inflated numbers must be removed entirely and (4). Contract must be publishable.