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 primary ICD-9 diagnosis codes with the highest levels of payment are ranked by total payment and all others are summarized.  All averages in the report are calculated on a per claim basis.  Claims without a diagnosis coded are excluded:

• 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. Payment also includes outlier amounts..
• Number Patient Claims - the total number of claims with the primary diagnosis.
• 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. Payment also includes outlier amounts.
• Total Outlier Amount - Total Medicare outlier payments. (Included in Total Payment.)
• National Average Charge - Computed national average charge for all US hospitals.