Outpatient Definitions and Methodology

All information in this report is taken from the Medicare Outpatient Prospective Payment System (OPPS) Limited Data Set which is updated annually by CMS based on the calendar year.  The file includes billing data for 100% of all Medicare fee-for-service claims for hospital outpatient services during the twelve months ending December 31.  The report is based on the most recent period available and is consistent with CMS cell size suppression policy.

The twenty Ambulatory Payment Classification Codes (APCs) with the highest total payment are ranked by amount and all others are summarized.  There are no APC codes for some procedures.  Averages are based on units of service (i.e. the number of units of the item or service delivered).

This report reflects Composite APCs. Composite APCs provide a single payment for a comprehensive diagnostic and/or treatment service that is typically reported with multiple HCPCS codes. When HCPCS codes that meet the criteria for payment of the composite APC are billed on the same date of service, a single payment is made for all of the codes as a whole, rather than paying each code individually. (Services that are grouped into a Composite APC are not reported individually on this report.) The grouping process is described in the CMS Internet-Only Manual (IOM) Pub. 100-04, Chapter 4, Section 10.2.1

Data included for each APC in this report are:

• Total Payment - the computed OPPS payment for a line item based on the payment APC. The "payment APC" refers to total payment, including deductible, coinsurance, and program payment.
• Number Patient Claims - the total number of claims with the APC.
• Units of Service - the number of units of the item or service delivered.  (One claim may have multiple units of service for an item or service.)
• Average Charge - the total charges (covered and non-covered) for all accommodations and services (related to the revenue code) for a billing period before reduction for the deductible and coinsurance amounts and before an adjustment for the cost of services provided.
• Average Cost - Charges adjusted to cost using the hospital's specific cost center cost-to-charge ratio. This calculation is done by CMS and included with OPPS claims data. (Details of the calculation are not provided by CMS.)
• Average Payment - The computed OPPS payment for a line item based on the payment APC. The "payment APC" refers to total payment, including deductible, coinsurance, and program payment.
• National Average Charge - Computed national average charge for all US hospitals.
• Service Mix Index - APC codes have relative weights that are periodically updated by CMS. The Service Mix Index is the average of APC relative weights for all claims (based only on APCs with non-zero relative weights).