A facility is looking into the possibility of adding or deleting procedures to their surgery product

line in the cardiothoracic area. The following table lists the types of procedures they are
reviewing

MS-
Description Relative Wt. National LOS
DRG

Heart Transplant or Implant of Health

2 15.6820 15.7
Assist System w/o MCC

Cardiac Valve & Other Maj

216 9.2380 13.0
Cardiothoracic Proc w Card Cath w MCC

Coronary Artery Bypass w PTCA w/o

232 5.5976 7.9
MCC

237 Major Cardiovas proc w MCC 5.0843 6.7

Complete the information below to determine the case mix of these surgery patients in your
facility.
Number of Patients
Your hospital's (estimate) Your hospital's
DRG
Actual LOS average charges

2 20.9 3 $89,500
216 12.1 107 $49,500
232 7.1 240 $32,000
237 11.6 156 $25,000

1. Determine the case mix for this group of procedures

MS-DRG Number of Patients Total Weights

2 3 3*15.6820 = 47.046

216 107 107*9.2380 = 988.466

232 240 240*5.5976 = 1,343.424

237 156 156*5.0843 = 793.1508

Totals 506 3,172.0868

Case mix 3172.0868/506 6.2689

2. Complete the estimated per patient payment from third parties for these MS-DRGs. Round to
the whole number.

Estimated per patient revenue from Your hospital's

Number of
MS-DRG third parties (based on a hospital Actual average
Patients (estimate)
payment rate of $5,500) charge

2 3 15.6820*5,500= 86,251 $89,500

216 107 9.2380*5,500= 50,809 $49,500

232 240 5.5976*5,500= 30,786.8 $32,000

237 156 5.0843*5,500= 27,963.65 $25,000

3. Compute the difference in LOS

Your hospital's Actual

MS-DRG National Average LOS Difference
LOS

2 20.9 15.7 20.9-15.7 = 5.2

216 12.1 13.0 12.1-13 = -0.9

232 7.1 7.9 7.1-7.9= -0.8

237 11.6 6.7 11.6-6.7= 4.9

4. Compute the difference in reimbursement or charges

Estimated revenue from third

MS-DRG parties (based on a hospital Your hospital's average charges Difference
payment rate of $5500)
86,251-89,500 =
2 86,251 $89,500
-3,249
50,809-49,500=
216 50,809 $49,500
1,309
30.786.8-32,000 =
232 30,786.8 $32,000
-1,232
 27,963.25-
237 27,963.65 $25,000
25,000= 2,963.25

5. For this group of patients only, what would the estimated income be?

Estimated revenue from third parties

MS-DRG (based on a hospital payment rate of No. of patients (estimate) Estimated reimbursement
$5500)

2 86,251 3 $258,753

216 50,809 107 $5,436,563

232 30,786.8 240 $7,388,880

237 27,963.65 156 $4,362,384

6. Based on this information, if you had to choose one procedure to add to your surgical product
line, which one

Based on the information above I would add MS-DRG 232 - Coronary Artery Bypass w PTCA
w/o MCC. This procedure has the most patients receiving it with 240 patients compared to MS-
DRG 237 or 2. The reimbursement is the highest due to the number of patients receiving the
procedure at $7,388,880. The length of stay is not horribly long with our hospital being 7.1.
Which is less then the national average got LOS. I think that procedure will overall the best
procedure to add,