Code of Massachusetts Regulations
114 CMR - DIVISION OF HEALTH CARE FINANCE AND POLICY
Title 114.5 CMR 23.00 - PAYER REPORTING OF TOTAL MEDICAL EXPENSES AND RELATIVE PRICES
Section 23.05 - Methodology for Reporting Relative Prices
Universal Citation: 114.5 CMR 23.00 MA Code of Regs 23.05
Current through Register 1531, September 27, 2024
(1) Relative Prices for Hospitals.
(a) Payers must report Relative Price data
separately by Medicare, Medicaid, Commonwealth Care, and commercial
(fully-insured and self-insured).
(b) Payers shall report hospital categories
separately for inpatient and outpatient.
(c) Payers must report Relative Price data
separately by hospital category for acute hospitals, chronic hospitals,
rehabilitation hospitals, and psychiatric hospitals.
(d) Notwithstanding 114. 5 CMR 23.05(1)(c),
Payers shall report additional behavioral health-only Relative Price data for
acute hospitals with psychiatric or substance abuse units with the psychiatric
hospital file. Payers must develop a standard definition of behavioral health
services to be used for all acute hospitals impacted by this
subsection.
(e)
Required Data Elements - Hospital Inpatient.
1. DHCFP Provider Number
2. OrgID or Payer's Internal Provider
Number
3. Name of
Hospital
4. Insurance Category
(Medicare, Medicaid, Commonwealth Care, or commercial)
5. Product Type (HMO, PPO, Indemnity, POS,
other)
6.
Hospital-specific Base Rate: the negotiated rate per
discharge, excluding any adjustments for case mix or severity of illness.
Payers must note when Hospital-Specific Base Rates are derived from payment
data.
a. For acute hospitals that are not paid
on diagnostic-related group (DRG) model, the Payer must calculate a
hospital-specific base rate equivalent. Payers who are able to demonstrate
significant hardship in developing acute hospital DRG base rates and obtaining
DRG software may apply to the Division for a waiver to use a standard per unit
rate.
b. For chronic,
rehabilitation, or psychiatric hospitals, Payers may use a per unit rate so
long as a uniform unit is applied within each hospital category.
7.
Network Average
Base Rate: the simple average of the Hospital-specific Base Rate
for all hospitals within a Payer's network.
8.
Total Non-claims
Payments: the sum of all Non-Claims Related Payments. The
allocation method for non-claims payments is outlined in the Data
Specifications Manual.
9.
Total Payments: the sum of all medical claims
payments.
10.
Case
Mix: the Payer's case mix index for the provider including all
cases.
11.
Number of
Discharges: the total number of discharges associated with a
provider.
12.
Hospital-specific Product Mix: the proportion of the
hospital's inpatient payments for HMO, PPO, Indemnity, POS, and other
Massachusetts provider network products.
13.
Network-wide Product
Mix: the proportion of the Payer's payments for HMO, PPO,
Indemnity, POS, and other Massachusetts provider network products.
14. DRG version and group number used in
calculation.
(f)
Calculation of Relative Prices - Hospital Inpatient.
Based upon the data specified in 114. 5 CMR 23.05(1)(e) the Division shall
calculate Hospital Inpatient Relative Prices by dividing Total Payments by the
product of Case Mix and Number of Discharges to derive an Adjusted Base Rate.
The sum of the products of the Adjusted Base Rate by the Network-wide Product
Mix will produce the Hospital Product Adjusted Base Rate. The Hospital's
Product Adjusted Base Rate divided by Payer's Network Average Product Adjusted
Base Rate shall result in the Hospital's Inpatient Relative Price. Payers will
be provided a copy of the calculation.
(g)
Required Data Elements -
Hospital Outpatient.
1. DHCFP
Provider Number
2. OrgID or Payer's
Internal Provider Number
3. Name of
Hospital
4. Insurance Category
(Medicare, Medicaid, Commonwealth Care, or commercial)
5. Product Type (HMO, PPO, Indemnity, POS,
other)
6.
Hospital-specific Service Multipliers: the negotiated
fee schedule multipliers for each hospital, for each fee schedule category as
determined by the Payer, for each product. For hospitals paid on a non-fee
schedule basis, multipliers shall be derived by dividing payments for a service
category by the amount that would have been paid if the hospital was paid at a
standard fee schedule or base rate for that service category. Payers must note
when Hospital-specific Service Multipliers are derived from payment
data.
7.
Total
Claims-based Payments: the sum of all medical claims
payments.
8.
Total
Non-claims Payments: the sum of all Non-Claims Related Payments.
The allocation method for non-claims payments is outlined in the Data
Specifications Manual.
9.
Hospital-specific Service Mix: the proportion of the
hospital's revenue for outpatient categories established by the Payer in 114. 5
CMR 23.05(1)(g)6.
10.
Network-wide Service Mix: the proportion of the
Payer's payments for outpatient categories established by the Payer in 114. 5
CMR 23.05(1)(g)6.
11.
Hospital-specific Product Mix: the proportion of the
hospital's outpatient payments for HMO, PPO, Indemnity, POS, and other
Massachusetts provider network products.
12.
Network-wide Product
Mix: the proportion of the Payer's payments for HMO, PPO,
Indemnity, POS, and other Massachusetts provider network products.
(h)
Calculation of
Relative Prices - Hospital Outpatient. Hospital Outpatient
Relative Prices shall be calculated by the Division by summing the products of
the Hospital-specific Service Multiplier for each product type by the
Network-wide Service Mix for that product type to derive a Base Service
Weighted Multiplier. The sum of the products of the Base Service Weighted
Multiplier for each product type and the Network-wide Product Mix shall produce
the Base Service and Product Adjusted Multiplier. The Division shall derive a
Non-Claims Multiplier of each product for each hospital by dividing non-claims
payments by total claims payments and multiplying the result by the Base
Service Weighted Multiplier. The sum of the products of the Non-claims
Multiplier and the Network Average Product Mix shall produce the
Product-adjusted Non-claims Multiplier. The sum of the Product-adjusted
Non-claims Multiplier and the Base Service and Product Adjusted Multiplier
divided by the Network Average Hospital Outpatient Multiplier shall result in
the Hospital's Outpatient Relative Price. Payers will be provided a copy of the
calculation.
(2) Physician Groups
(a)
Payers must separately identify and report Relative Price data for physician
groups who received 3% or more of a Payer's payments to Massachusetts physician
group practices.
(b) Payers shall
report aggregate Relative Price data for all physician groups who received less
than 3% of a Payer's physician group payments in the relevant reporting period
but were not paid on the Payer's standard fee schedule. The Division may
request additional information on such providers.
(c) Payers shall report aggregate Relative
Price data for all physician groups who received less than 3% of a Payer's
physician group payments in the relevant reporting period and were paid on the
Payer's standard fee schedule. The Division may request additional information
on such providers.
(d)
Required Data Elements.
1. DHCFP Provider Number
2. OrgID or Payer's Internal Provider
Number
3. Name of Physician Group
Practice
4. Name of Local Practice
Group
5. Pediatric
Indicator
6. Insurance Category
(Medicare, Medicaid, Commonwealth Care, or commercial)
7. Product Type (HMO, PPO, Indemnity, POS,
other)
8.
Physician
Group-specific Service Multipliers: the negotiated fee schedule
multipliers for each physician group, for each fee schedule category as
determined by the Payer, for each product. For physician groups paid on a
non-fee schedule basis, multipliers shall be derived by dividing payments for a
service category by the amount that would have been paid if the physician group
was paid at a standard fee schedule or base rate for that service category.
Payers must note when Physician Group-specific Service Multipliers are derived
from payment data.
9.
Physician Group-specific Service Mix: the proportion
of the physician group's revenue for service categories established by the
Payer in 114. 5 CMR 23.05(2)(d)8.
10.
Network-wide Service
Mix: the proportion of the Payer's payments to physician groups
for service categories established by the Payer in 114. 5 CMR
23.05(2)(d)8.
11.
Physician Group-specific Product Mix: the proportion
of the physician group's payments for HMO, PPO, Indemnity, POS, and other
Massachusetts provider network products.
12.
Network-wide Product
Mix: the proportion of the Payer's payments for HMO, PPO,
Indemnity, POS, and other Massachusetts provider network products.
13.
Total Claims-based
Payments: the sum of all medical claims payments.
14.
Total Non-Claims
Payments: the sum of all Non-Claims Related Payments. The
allocation method for non-claims payments is outlined in the Data
Specifications Manual.
(e)
Calculation of Relative
Prices - Physician Groups. Physician Group Relative Prices shall
be calculated by the Division by summing the products of the Physician
Group-Specific Service Multiplier for each product type by the Network-wide
Service Mix for that product type to derive a Base Service Weighted Multiplier.
The sum of the products of the Base Service Weighted Multiplier for each
product type and the Network-wide Product Mix shall produce the Base Service
and Product Adjusted Multiplier. The Division shall derive a Non-claims
Multiplier for each physician group by dividing non-claims payments by total
claims payments and multiplying the result by the Base Service Weighted
Multiplier. The sum of the products of the Non-claims Multiplier and the
Network Average Product Mix shall produce the Product-adjusted Non-claims
Multiplier. The sum of the Product-adjusted Non-claims Multiplier and the Base
Service and Product Adjusted Multiplier divided by the Network Average
Physician Group Multiplier shall result in the Physician Group's Relative
Price. Payers will be provided a copy of the calculation.
(3) Other Providers.
(a) Payers must report the data separately
for the following provider categories:
1.
Ambulatory surgical centers;
2.
Community health centers;
3.
Community mental health centers;
4.
Freestanding clinical labs;
5.
Freestanding diagnostic imaging;
6.
Home health agencies; and
7.
Skilled nursing facilities.
8. The
Division may specify additional provider categories for which Payers must
submit Relative Prices by Administrative Bulletin.
(b) Payers must separately identify and
report Relative Prices for providers who received 3% or more of payments in a
given provider category as identified in 114. 5 CMR 23.05(2)(a) for the
relevant reporting period.
(c)
Payers shall report aggregate Relative Price data for all providers who
received less than 3% of payments in the relevant reporting period for a given
provider category but were not paid on the Payer's standard fee schedule. The
Division may request additional information on such providers.
(d) Payers shall report aggregate Relative
Price data for all providers who received less than 3% of payments in the
relevant reporting period for a given provider category and were paid on the
Payer's standard fee schedule. The Division may request additional information
on such providers.
(e)
Required Data Elements.
1. DHCFP Provider Number
2. OrgID or Payer's Internal Provider
Number
3. Name of
Provider
4. Pediatric
Indicator
5. Insurance Category
(Medicare, Medicaid, Commonwealth Care, or commercial)
6. Product Type (HMO, PPO, Indemnity, POS,
other)
7.
Provider-specific Service Multipliers: the negotiated
fee schedule multipliers for each provider, for each fee schedule category as
determined by the Payer, for each product. For providers paid on a non-fee
schedule basis, multipliers shall be derived by dividing payments for a service
category by the amount that would have been paid if the provider was paid at a
standard fee schedule or base rate. Payers must note when Provider-specific
Service Multipliers are derived from payment data.
8.
Provider-specific Service
Mix: the proportion of the provider's revenue for service
categories established by the Payer in 114. 5 CMR 23.05(3)(e)7.
9.
Network-wide Service
Mix: the proportion of the Payer's payments for service categories
established by the Payer in 114. 5 CMR 23.05(3)(e)7.
10.
Provider-specific Product
Mix: the proportion of the provider's payments for HMO, PPO,
Indemnity, POS, and other Massachusetts provider network products.
11.
Network-wide Product
Mix: the proportion of the Payer's payments for HMO, PPO,
Indemnity, POS, and other Massachusetts provider network products.
12.
Total Claims-based
Payments: the sum of all medical claims payments.
13.
Total Non-claims
Payments: the sum of all Non-claims Related Payments. The
allocation method for non-claims payments is outlined in the Data
Specifications Manual.
(f)
Calculation of Relative
Prices - Other Providers. Other Provider Relative Prices shall be
calculated by the Division by summing the products of the Provider-specific
Service Multiplier for each product type by the Network-wide Service Mix for
that product type to derive a Base Service Weighted Multiplier. The sum of the
products of the Base Service Weighted Multiplier for each product type and the
Network-wide Product Mix shall produce the Base Service and Product Adjusted
Multiplier. The Division shall derive a Non-claims Multiplier for each provider
by dividing non-claims payments by total claims payments and multiplying the
result by the Base Service Weighted Multiplier. The sum of the products of the
Non-claims Multiplier and the Network Average Product Mix shall produce the
Product-adjusted Non-claims Multiplier. The sum of the Product-adjusted
Non-claims Multiplier and the Base Service and Product Adjusted Multiplier
divided by the Network Average Provider Multiplier shall result in the
Provider's Relative Price. Payers will be provided a copy of the
calculation.
(4) Due Dates.
(a)
Annual Reports.
1.
Hospitals. Payers must submit required Relative Price
data reports for Hospitals by June 1st each year for
the prior Calendar Year.
2.
Physician Groups. Payers must submit Relative Price
data reports for Physician Groups by June 1st each
year for the Calendar Year ending seventeen months prior.
3.
Other Providers.
Payers must submit required Relative Price data reports for ambulatory surgical
centers, community health centers, community mental health centers,
freestanding clinical laboratories, freestanding diagnostic imaging centers,
home health agencies, and skilled nursing facilities by June
1st each year for the prior Calendar Year.
(b)
Initial
Filing. Payers must submit hospital Relative Price data for
Calendar Years 2009 and 2010, and physician group Relative Price data for
Calendar Year 2009 by June 1, 2011. Payers must submit other provider Relative
Price data for Calendar Year 2010 by June 30, 2011.
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