D.C. Mun. Regs. tit. 29, r. 29-4808
For Medicaid reimbursement of inpatient hospital discharges, the APR-DRG PPS shall provide an additional payment for outliers, high-cost and low-cost, based on inpatient costs.
For discharges on or after October 1, 2014, DHCF shall provide an additional payment for inpatient stays when the cost of providing care results in a loss to the hospital that exceeds the high-cost outlier threshold (i.e., high-cost outlier). The goal for District-wide high-cost outlier payments is to identify an estimated maximum of five percent (5%) of inpatient payments as high-cost outliers.
The loss to the hospital shall be calculated pursuant to the following formula:
LOSS
=
COST (ALLOWED CHARGES X COST TO CHARGE RATIO (CCR))
-
THE DRG BASE PAYMENT
The outlier payment is calculated as follows if the loss exceeds the outlier threshold:
OUTLIER PAYMENT
=
(LOSS - OUTLIER THRESHOLD)
x
THE MARGINAL COST FACTOR
The DRG PPS payment for the stay shall be the sum of the DRG base payment and the outlier payment, adjusted for transfer pricing, if applicable.
The CCR used to calculate the cost of a claim shall be hospital-specific as described at Section 4802.
The high-cost outlier threshold shall be reviewed annually and updated when necessary based upon a review of claims history from the District's previous fiscal year.
For discharges occurring on or after October 1, 2014, and annually thereafter, DHCF shall adjust payments for extremely low-cost inpatient cases.
Low-cost outliers shall be those cases where the gain on the claim (claim costs minus DRG base payment) exceeds the low-cost outlier threshold.
Low-cost outliers shall be determined by using the formula identified at Subsection 4808.13.
Each claim with a gain that exceeds the low-cost outlier threshold shall be paid at the lesser of the APR-DRG payment amount or a prorated payment.
DHCF shall set the low-cost outlier threshold at a level that results in four percent (4%) or less of APR-DRG payments being associated with low-cost outlier cases.
The low-cost outlier calculation shall use the national average lengths of stay (ALOS) available with the APR-DRG grouper as follows:
LOW-COST OUTLIER PAYMENT
=
(DRG BASE PAYMENT / NATIONAL ALOS)
x
(LOS FOR ELIGIBLE DAYS OF THE STAY +1)
If the low-cost outlier payment results in an amount greater than the DRG base payment, DHCF shall disregard the low-cost outlier payment.
DHCF shall review and calculate the low-cost outlier threshold annually and update where necessary based upon a review of claims history from the previous District fiscal year.
D.C. Mun. Regs. tit. 29, r. 29-4808