HOSPITAL CHARGES 101
In compliance with the Centers for Medicare and Medicaid Services (CMS), Arbuckle Memorial Hospital is making available to the public a copy of its standard charges known as a “Charge Master,” “Charge Description Master” or “CDM.”
Before you search through this file to learn what it may cost you to receive an item or service provided by the hospital or clinic, it is important to understand that what the hospital or clinic charges for a service IS NOT the same as what you or your insurance company may pay for a service. In fact, virtually no one pays the charges you will see listed.
Charges are simply a tool that health care providers use to negotiate contracts with insurance companies, and to evaluate the financial impact of these negotiations on the financial health of the institution.
Charges are the same for all patients, but a patient’s responsibility may vary depending on payment plans negotiated with individual insurers. Further discounts are available for uninsured or underinsured patients who qualify.
So before you search this file, we encourage you to take this short course we call “HOSPITAL CHARGES 101.” It will make it easier for you to use this file, and better understand the information that is included.
USING THE CDM FILE
The CDM, available below here in an Excel format, includes a separate line or listing for over 4,000 items and services that may be provided by the hospital or clinic. Each line includes:
- Column 1: Charge Code – a number that is assigned by the hospital and unique to an individual item or service
- Column 2: Description – a description of the item or service
- Column 3: Charge
Please note that during most hospital and clinic visits, you will likely receive more than one of the items or services listed on the CDM.
HOW ARE CHARGES SET?
Charges are set by the hospital based on the total direct costs – professional fees, staffing, supplies, equipment – and indirect costs – administration, medical records, billing, housekeeping, maintenance, facility expenses, etc.– of providing the service. Often, charges are also compared to charges established by other hospitals and clinics in the region to help ensure they are comparable.
Charges can be hard for patients to understand because they reflect:
- the direct services the patient actually experiences,
- ALL the things that happen behind the scene that make those services possible,
- AND the cost of making those services available 24-hours-a-day, 7-days-a-week, 365-days-a-year.
WHAT DOES THE HOSPITAL ACTUALLY GET PAID?
Arbuckle Memorial Hospital is seldom – if ever – paid the full amount of billed charges.
The hospital negotiates payment rates with every major insurance company that provides coverage to residents in our community. As part of that negotiation, the insurance company typically establishes an “allowable” rate for each item or service, and then further establishes a discount from that “allowable” rate that they will pay, minus any deductibles, coinsurance and co-pays that the insurance company indicates are the patient’s responsibility. This “allowable” rate typically falls well below hospital charges.
If the insurance company refuses to contract with the hospital, or the hospital is unable to negotiate a satisfactory contract with the insurance company, Arbuckle Memorial Hospital may be considered “out-of-network” with that plan. The insurance company may then chose not to pay for the services you receive at an “out-of-network” hospital, increasing your out-of-pocket payments.
It is likely that your insurance company has negotiated different payment rates with each hospital under contract.
WHAT IS THE IMPACT OF CHARGES ON DEDUCTIBLES, COINSURANCE AND COPAYMENTS?
Deductibles vary by insurance company, from as little as $500 per year to $10,000 or more per year, and reflect the plan you or your employer selected and the premium paid for that coverage. Lower deductible plans typically have higher monthly premiums, while higher deductible plans have lower monthly premiums. The deductible is the amount you will pay each year before you receive full benefits from your insurance company.
Established by your insurance company and plan, coinsurance is a percentage of the “allowable charge” that you will pay after you have reached your deductible. Also established by your insurance company or plan, co-pays are a flat fee you pay for a health care service. Co-pays can take effect either before or after your deductible has been met, and may not apply to all services.
Information about your deductibles, coinsurance and copayments are available from your insurance company or employer.
WHAT ABOUT MEDICAID?
Medicaid pays all hospitals based on the same fee schedule. You can view the fee schedule or lookup a Medicaid fee by going to the Oklahoma Healthcare Authority website:
For Rural Health Clinic services, Medicaid pays the Arbuckle Family Clinic on a cost-based calculation.
WHAT ABOUT MEDICARE?
As a federally designated Critical Access Hospital, traditional Medicare pays Arbuckle Memorial Hospital based on the actual cost of providing care to Medicare patients.If you have a supplemental plan or Medigap coverage, it will cover some or all of your deductible, coinsuranceand co-pays. You will need a separate Medicare Part D plan to secure insurance coverage of drugs.
If you have enrolled in a “Medicare Advantage Plan” you no longer have traditional Medicare. These “Plans” are offered by private insurance companies and have different monthly premium, deductibles, coinsurance and co-pays. Some of these plans will include drug coverage, but you cannot buy a Medigap policy.
Again, information about your deductibles, coinsurance and copayments are available from the insurance company that sold you the “Medicare Advantage Plan.”
WHAT ABOUT PATIENTS WHO DO NOT HAVE INSURANCE COVERAGE?
For patients with no insurance, the hospital provides an “uninsured discount” from charges that will be the amount owed by the patient for services provided.
Uninsured or underinsured patients should consult with our business office staff at (580) 622-2161 or come by to speak to one of our business office representatives to determine whether or not they qualify for discounts.
If you have further questions about the Arbuckle Memorial Hospital CDM, please contact our hospital business office at (580) 622-2161 or come by and speak to one of our business office representatives.
ARBUCKLE MEMORIAL HOSPITAL CHARGE MASTER
Please register to download a copy of the Arbuckle Memorial Hospital CDM.