PhilHealth Circular No. 0035 s.

2013 IMPLEMENTING GUIDELINES ON MEDICAL AND PROCEDURE CASE RATES - TAMANG SAGOT -

I. CASE RATE PAYMENT SCHEME 1. What is Case Rate Payment Me hanism! Case Rate Payment is a mechanism utilized by insurance corporations when reimbursing payment for health care providers, e.g. hospitals and professionals/doctors. In this system, a single rate which was derived from computations from previous claims will be given as payment to providers for a particular condition. This system aims to improve the uality of healthcare and enhance the transparency with the members. ". What a#e the a$%anta&es '( a)) ase #ates! It improves transparency and predictability. The members can determine the fi!ed price for a certain case/disease/procedure they will undergo. It ma"es the benefits easier to communicate to the members. #ll cases will be classified and have fi!ed rates including the catastrophic diseases which could really help our members. *. Was the#e a st+$y 'n ase #ates ha%in& ,#'%en that it is m'#e e((e ti%e than --S! $ased on the e!periences of other countries in their payment mechanisms as well as their insurance systems, there are only a couple of countries who have remained with fee for service as their payment mechanism. The fee%for%service is an ineffective way of payment mechanism in insurance companies. It has been shown in previous studies that the fee%for%service mechanism leads to rapid rise in health insurance premiums &$rantes, '(()*. It was also mentioned in the same study that this system has failed to promote coordination among providers or high uality outcomes for patients. In the local scene, there are a couple of studies that were conducted by +,- and the +orld $an" that compares Case Rates vs. .ee%for%/ervice. They have concluded that the Case Rates is better than ../. #side from the above mentioned advantages, case%based payments will also ma"e it easier for the corporation to support the poorest of the poor &sponsored members* through the 0o $alance $illing Policy. .. What a#e the )imitati'ns '( the +##ent e/istin& ,ayment system!
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The old method of fee%for%service &../* had its limitations based on the following1 2. .ee%for%/ervice payments re uired Phil,ealth to pre%evaluate all claims received prior to payments. Thus, it was bureaucratic and time%consuming. Phil,ealth processes close to 3,(((,((( claims per year. Therefore, there were a lot of delayed payments to providers as well. Turn%around%time from filing of claims to payment used to be more than )( days, some reaching 4%5 months before getting paid. '. ../ re uired members and providers to understand the benefit table and "now how to compute for their benefits. This limited the understanding of the benefits, especially for those who have educational limitations. 6. ../ re uired Phil,ealth to compute for benefits. #nd this e!posed the system to errors in computations. There was also the ris" for discretion of claims processors in terms of deductions and benefit pay%outs. 4. 7espite the payments, the ../ system cannot be complemented with a regulatory policy that limits out%of%poc"et payments &li"e the no balance billing policy* because there is a ris" that the providers would 8ust "eep charging and Phil,ealth would 8ust "eep paying until the ma!imum limit of the ../ schedule is reached. 3. ../ also created ine uity and unfairness when reimbursing the hospitals since the costs varied as much as the hospitals applying for reimbursement as different rates were paid for performing one and the same function or using one and the same process or diagnostic. 0. A#e the#e st+$ies t' $ete#mine h'1 m+ h it 1i)) 'st +sin& a)) ase #ates 'm,a#e$ t' the -ee ('# Se#%i e! -ur actuary handles the studies and pro8ections as well as the history of claims. They consider the rates for IC7 codes and R9/ and compare that with the previous years. They present the loss as well as the ad8ustments and have concluded that we are capable of implementing the #ll Case Rates Policy. II. IMPLEMENTATION 1. Wi)) this 2e im,)emente$ han$ in han$ 1ith #e%ise$ 2ene(its ('# ,#ima#y a#e (a i)ities! The policy for benefits for primary care facilities is discussed in a separate circular. Please refer to PC 24 s '(26. This circular includes the list of the benefits that can be claimed for PC.. ". What meas+#es a#e 2ein& ta3en t' a$$#ess the iss+e '( $e)aye$ $ist#i2+ti'n 2y the h's,ita)s '( ,#'(essi'na) (ees (#'m ase #ates! There is a P,IC policy that the hospitals are mandated to issue the professional fee of the doctors within a month after the hospital received their payment from P,IC, as
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stated in the Implementing :uidelines Reports of noncompliance to this provision shall be forwarded to the Phil,ealth Raegional -ffice &PR-* ,ealth Care 7elivery ;anagement 7ivision &,C7;7* and shall be included as a violation of the ,CI to the ,ealth Care Provider Performance Commitment. *. I( h's,ita)s +se$ n'n PND- $#+&s an$ 1e 1e#e a2)e t' ,'st a+$it it4 an h's,ita) a,,ea) i( 1e ha#&e it t' (+t+#e )aims! /;7 will issue appropriate policies regarding the process flow on post%audit and penalties and sanctions soon. The proposed process is after post%audit, the report is forwarded to the hospital and e!planation or 8ustification for findings is demanded. If the 8ustification is sufficient, then no penalty, $ut if 8ustification is unacceptable, ,CI may be penalized. -ne option for the penalty is charging to future claims. -nce penalty has been imposed &whether monetary, or charged to future claims*, ,CI can no longer appeal.

.. Wi)) the system #eset a)) )aims '( mem2e#s an$ ,atients 1hen it 'mes t' the .0 $ay )imit an$ SPC +,'n im,)ementati'n '( ACR! +e cannot divulge this to the public. $ut the plan is to reset to minimize the pressures on the system. ,owever, this has not been approved by the <=<C-; yet and we need to secure their approval prior to implementation. 0. What 1i)) 2e the 'nse5+en e '( ha%in& the 1#'n& '$e ,)a e$ 'n the )aim ('#m! This has always been reiterated in the policies of Phil,ealth. The correct R9/ or IC7 code is re uired for payment. Placing the wrong R9/ or IC7 code will cause significant delay in the processing of the claim or it might even be grounds for denial. This will be emphasized in the all case rates policy as the benefits are dependent on the use of the correct codes, whether R9/ or IC7 2(.

III. REIM6URSEMENT7-EES 1. H'1 is the P- 'm,'nent '( s+#&i a) ase #ates 'm,+te$! The surgical case rates are primarily based on the R9> value of the different procedure. The R9> value of each procedure was based on consultation of different surgical societies. The professional fee is computed as relative value unit &R9>* ! 35 &peso conversion factor* ! 2.3. The facility fee component shall be the remaining balance when the P. is subtracted from the case rate amount. Please refer to the e!ample given below1
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P#' e$+#e8 C)'se$ t#eatment '( #a$ia) hea$ (#a t+#e 9R:S '$e8 ".;0<= Case Rate am'+nt8 2(??( R:U8 43 P#'(essi'na) (ee8 43 ! 35 ! 2.3 @ *>?< -a i)ity (ee8 2(??(%6)?(@ >1<< ". Wi)) &ene#a) ,#a titi'ne#s an$ s,e ia)ists &et the same P- in the A)) Case Rates S heme! The #ll Case Rates /cheme does not discriminate between :Ps and specialists. The hospital has the discretion on the distribution of the P. of the professionals based on their credentials. The burden of encouraging professionals to get certified is placed on the healthcare institution.

*. What is the #ati'na)e 2ehin$ the +ni('#m t#eatment 2et1een GPs an$ s,e ia)ists! This is done to address the issue of specialists being concentrated in urban areas and hospitals. There are far%flung rural areas where there are no specialists available, and only :Pspractice. #side from this, there is currently no evidence that shows improvement of outcome when a patient is treated by a specialist. .. H'1 is the P- 'm,'nent '( the ase #ate 'm,+te$!

Professional fees for medical conditions can be computed at 6(A of the case rate while the professional fees for most old procedures case rates can be computed at 4(A e!cept for some cases li"e cholecystectomy R9> 63(, thyroidectomy R9> 63(, etc. that uses the R9> ! 35 ! 2.3 rule. -ther simple procedures are also computed at R9> ! 35 only. If managed by only one physician, he/she can get the whole P. portion of the case rate. ,owever, in case of multiple physicians, Phil,ealth leaves the distribution of the P. portion to the healthcare institution #nne!es 2 and ' of the Implementing :uidelines contain the official list of case rates and their corresponding fees. The professional fee and facility fee is detailed for each case rate.

0. Wi)) Phi)Hea)th $e$+ t the 1ithh')$in& ta/ (#'m the (a i)ity as 1e)) as the $' t'#!
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#s mentioned in the $IR issuance in the anne!es, Philhealth is not e!empt from being a withholding agent of the $IR. In the #ll Case Rate scheme, Philhealth will only deduct 'A withholding ta! from the facility fee. .or the professional fee, the hospital will be the one responsible to deduct the withholding ta!. #s such, it is also the hospital who will be responsible to issue the $IR .orm '6(). Bindly refer to the e!ample given below1 Case Rate8 A2s ess '( Res,i#at'#y T#a t Case Rate Am'+nt8 2(,((( P#'(essi'na) -ee8 6, ((( Ta/ t' 2e 1ithhe)$ 2y Phi)hea)th8 NONE &the hospital is in charge to deduct the appropriate ta!es -a i)ity -ee8 ),((( Ta/ t' 2e 1ithhe)$ 2y Phi)hea)th8 ),((( ! (.('@ 1.< 9"@ '( the (a i)ity (ee=

;. In the s ena#i' that a Phi)Hea)th C)aim 1as $enie$ an$ itAs n't the (a+)t '( the $' t'#. What ha,,ens t' the ,#'(essi'na) (ees! In this case, the doctor will not be able to receive the professional fee from the claim. It is the responsibility of the hospital to ensure that the re uirements of claims are complete and the forms are properly filled up. It will be the hospital who will be answerable to the doctor in this case. >. Wi)) the #ate stay the same $es,ite )en&thy 'n(inement! Ces. The case rate is fi!ed regardless of length of stay. ?. A#e me$i a) missi'ns #eim2+#se$ 2y Phi)Hea)th! H'1 a2'+t s+#&i a) missi'ns! Claims for medical missions will be denied since only cases which warrant hospital admission are compensable under the #ll Case Rates scheme. .or surgical missions, as mentioned in PC 2%'(2', surgical procedure involving cataract e!traction, cleft lip and palate repair, in%grown toenails and circumcision shall not be compensated. #s for other procedure, surgical missions conducted at Philhealth%#ccredited government facilities shall be compensated provided that the professional fees shall be pooled for distribution to all personnel of the facility.

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B. The#e is n' ase #ate ,a 3a&e ('# the ICD '$e I am )aimin&. Wi)) my )aim 2e $enie$! +e recognize that the codes included in the case rate are only those from the benefit utilization data from '((D%'(22. #s of the moment, only the codes listed in the anne!es will be reimbursed. The conditions and procedures included in the anne!es are the ones which were already claimed from Philhealth. Providers who encounter such codes may call the attention of the In%Patient Team so that the case can be reviewed. 1<. What ha,,ens i( the s' iety s+2mitte$ a P- hi&he# than in the ,#','sa)! #ll the case rates were computed using data from claims from '((D to '(22. 7uring the process of development of case rates, specialty societies were consulted and their proposals for professional fees were considered. In the event that ad8ustments and enhancement of rates are re uested, concerns should be submitted to the Corporation. The In%Patient Team shall be continually engaging with the providers to enhance the case rates. 11. What ha,,ens t' the e/ ess am'+nt '( ase #ates n't +se$ 2y the (a i)ity 9e.&. ase #ate is P104<<< 2+t SOA is C+st P1*4<<<=! It is given as an efficiency gain for the facility. It is an incentive given to the facility for being efficient in providing uality care for its patients using less resources. ,owever, healthcare institutions will be closely monitored for any suspicious underutilization of services. This will have corresponding penalties.

I:. MEM6ERSHIP 1. D' PHIC mem2e#s nee$ t' se +#e a ne1 MDR e%e#y time they 1i)) 2e a$mitte$! #t the moment almost all of the ,ospitals in the region have a functional portal, which is connected to the database of the P,IC to chec" the memberEs status. The Philhealth Cares can also be approached for assistance regarding the availment of benefits

:. NO 6ALANCE 6ILLING7SPONSORED MEM6ERSHIP 1. Why a#e mem2e#s 1h' a#e n't ,ayin& ,#emi+ms 9s,'ns'#e$ mem2e#s ie e/t#eme)y ,''#= &et the same 2ene(its as th'se 1h' a#e ,ayin&! .or the e!tremely poor and no capability to pay, the government ta!es pay for their contribution, giving them access to Phil,ealth benefits. This goes bac" to the
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concept of social health insurance in which the premiums of the healthy population is used to subsidize the healthcare costs of those who cannot afford payment. #ll this is being done to support the process of achieving >niversal ,ealth Care. ". What 1i)) ha,,en i( h's,ita) ha#&es ('# N66 ,atients in &'%e#nment h's,ita)s e/ ee$ the ase #ate am'+nt! The government subsidy will cover for it. The amount for each case rate was computed by ta"ing the average of previous claims since '((D%'(22. /ince the rates represent averages, there will naturally be some cases which will e!ceed the computed rates. ,owever, there will also be cases which will not be able to ma!imize the rates &ie total cost will be below the set case rate*. The gains from the cases that fall below the set case rates should cover for the ones that e!ceed the rates. :I. MULTIPLE DIAGNOSIS 14 In ases 1he#e m+)ti,)e ,#' e$+#es a#e $'ne in 'ne a$missi'n4 h'1 1i)) the #ate 2e 'm,+te$! Computation will be based on first and second case rates, where the former will be paid in full and the latter paid 3(A if applicable. .or now, there are only a limited number of procedures that are allowed as second case rate. ". I 1as a$mitte$ ('# m+)ti,)e $ia&n'ses. H'1 'me I 1i)) 'n)y 2e #eim2+#se$ ('# 'n)y 'ne ase #ate! .or now, we are reimbursing only one case rate. .or now, only certain conditions &;I, /tro"e, maternal comorbids* are allowed as second case rates. <!pansion of the codes allowed as second case rate is undergoing feasibility studies and is being reviewed.

:II. 6URNS 1. The#e a#e $i((e#ent s+#(a e a#eas ('# 2+#ns 9e.&. e#tain 2+#ns that a#e a#'+n$ "<@ - *<@ 'm,a#e$ a&ainst 2+#ns a#'+n$ ><@=. H'1 1i)) ase #ate t#eat s+ h ase! Phil,ealth will be paying through Case type #, $, and C. $urn # &F'(A surface area* will be paid P?,5((, $urn $ &'(%5(A /#* will be paid P2(,3((, and $urn C &G5(A /#* will be paid P25,3((. ". What ha,,ens i( a 2+#n ,atient +n('#t+nate)y is 2+#ne$ a&ain!

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$urn case rate as a medical condition will be denied. ,owever, because simple debridement is e!empted from the /PC, this procedure will be provided.

:III. LYING IN CLINICS

1. Wi)) mi$1i%es in )yin&-in )ini s 2e 'm,ensate$ ('# #e(e##in& $i((i +)t 7 'm,)i ate$ ,#' e$+#es t' hi&he# )e%e) (a i)ities! Ces. #ccredited Hying%in clinics will be paid a referral fee of P53(. ". What a#e the 'n)y ,#' e$+#es a))'1e$ in a #e$ite$ )yin&-in )ini s! Hying%in clinics are only allowed to perform I>7 insertion and normal low%ris" delivery as maternity pac"age. -ther complicated procedures such as delivery of high% ris" pregnancies &specific list is detailed in PC '6%'((5 are not allowed in the lying%in clinics and will not be reimbursed.

ID. SINGLE PERIOD O- CON-INMENT 1. The#e a#e ase #ates that en 'm,ass $i((e#ent $iseases. -'# SPC4 1e +se the ase #ate. What ha,,ens i( I 1as a$mitte$ ('# a $i((e#ent ICD 2+t same ase #ate ,a 3a&e! .or now, /PC covers the case rate pac"age and the second claim will be denied. +e can propose further brea"down of groups into subgroups in the future once data is available. ". Patient 1as &i%en the ase #ate 2ene(it '( ,ne+m'nia an$ st#'3e. A(te# *< $ays4 ,atient 1as a$mitte$ ('# ,ne+m'nia an$ $ie$ $+#in& his 'n(inement. Wi)) ,ne+m'nia ('# the se 'n$ 'n(inement 2e ,ai$! /ince pneumonia is covered by the /PC, unfortunately, his claim for the pneumonia for the second confinement will be denied. *. Patient )aime$ MI as (i#st ase #ate an$ st#'3e as se 'n$ ase #ate. A(te# .0 $ays4 ,atient )aime$ st#'3e as (i#st ase #ate an$ MI as se 'n$ ase #ate. Wi)) this sti)) 2e '%e#e$ 2y the SPC! Ces, the /PC rule will be applied for both case rates, regardless if listed as first or second.
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D. SPECI-IC CASES 1. We +se$ 2e('#e an a&e )imit '( th#ee yea#s ')$ t' i# +m isi'n $+e t' ,him'sis. A#e 1e sti)) &'in& t' ('))'1 that in the ase #ate! There will be no age limit for circumcision due to phimosis. It should be noted that the indication for payment for circumcision is phimosis. ". On ,e#it'nea) $ia)ysis4 the ,atient 2+ys s+,,)ies (#'m the s+,,)ie# an$ n' h's,ita) 1ants t' e#ti(y ('# the )aim. H'1 1i)) this 2e ,ai$! Circular 5 '((5, all P7 e!changes performed per day shall be charged only 2 day against the 43 day room and board allowance. Right now, pay as per e!isting policy. The IPT is in the process of enhancing our e!isting policy. Please give us feedbac"/data regarding provisions/policies you want to be included. *. The OHAT Pa 3a&e is ,ai$ +sin& the --S ,ayment me hanism. What ha,,ens t' OHAT in a)) ase #ates! Pac"ages utilizing the ../ mode of payment shall be amended to be consistent with the all case rates. .. Is the#e a )imit t' the n+m2e# '( sessi'ns '( hem'$ia)ysis that an 2e )aime$! Technically, we did not set any limits as to the number of hemodialysis sessions. ,owever, other reimbursement policies, standards of care and ,CI behavior will dictate the number. +e have the 43 days benefit limit so technically, patient may only be confined for that length of time. /tandards of care dictate that dialysis patients can only undergo hemodialysis about 6! a wee". /o in the 43 days ma!imum confinement, patient may only undergo hemodialysis for about '(!. $ut since this is one confinement and therefore shall be reimbursed with ma!imum of ' case rates one of which shall be hemodialysis, the ma!imum reimbursement shall only be about 23(,((( &about )(,((( for the first case rate and ?(,((( for the dialysis at 4((( per session for '( sessions*. .or a 43%day confinement, this is meager and hospital behavior will eventually limit the services given to the patient 0. Is hem'the#a,y ase #ate 'n a sessi'n '# y )e 2asis! H'1 many $ays 1i)) 2e $e$+ te$ (#'m the .0 $ays! Chemotherapy case rate is computed on a per cycle basis. one cycle is e uivalent to the amount reflected in anne! ' &)'?(* of the circular and is also e uivalent to ' days deduction from the 43 days. # separate circular will be issued to detail the policies regarding chemotherapy claims.
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;. Chem'the#a,y an$ ,e#it'nea) $ia)ysis ase #ate $'esnAt seem t' 'm,ensate '+# mem2e#s. #s mentioned, chemo and P7 are transition policies and thus may not be as responsive as we want them to be. ;ore comprehensive consultations are being done to ma"e the case rates better. >. A#e the#e any Case Rates 1ith s,e i(i #+)es an$ 'nsi$e#ati'ns! #. #cute :astroenteritis1 .or this case rate, additional codes for the level of dehydration is re uired, otherwise the claim shall be denied. .or #:< with moderate/mar"ed dehydration, the code <?5.2 is re uired and for #:< with severe dehydration, the code <?5.' is re uired. If the patient does not belong to the above mentioned classification for dehydration, then the claim shall be denied. $. #sthma1 Claims for asthma in acute e!acerbation, e!cept for certain medical conditions, shall be assigned an additional 3 th character to be appended to the assigned IC7 2( code. The appropriate and complete IC7 2( codes for each case are found in #nne! 2. C. Pneumonia1 Claims for pneumonia, e!cept for certain medical conditions, shall be assigned an additional 4th or 3th character to be appended to the assigned IC7 2( code. The appropriate and complete IC7 2( codes for each case are found in #nne! 2.

DI. RE-ERRAL PACEAGE 1. H's,ita) A #e(e#s a ,atient 1ith ,ne+m'nia m'$e#ate #is3 t' H's,ita) 64 1h'se $is ha#&e $ia&n'sis is ,ne+m'nia hi&h #is3. Wi)) 2'th h's,ita)s 2e ,ai$ the (+)) ase #ate! +e have not much control over this. In cases of transfer, hospital # will always have a choice on how it will file its claim % whether as full case rate or as referral pac"age. If they followed all rules and guidelines on referral, thereIs very little ris" that their claim will be denied even if hospital $ files a claim. ,owever, if they file as full case rate and not as referral pac"age, thereIs a high ris" that their claim will be denied since their claim will overlap with the claim of hospital $. ,owever, if the case rates claimed by the two hospitals differ, the system shall pay both. /o to catch this, and because thereIs also the chance that these ,CIs will connive, we shall as" /;7 to include this as part of the automatic post%audit. +e shall set standard days of interval between admissions and readmissions, regardless of illness.

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". Is the#e a )imit 'n the ases that a#e a))'1e$ t' )aim the #e(e##a) ,a 3a&e! #side from the limits on transfers &lower to higher level e!cept H6%H6*, the referral pac"age also has limits on the cases that may be referred. This is found in anne! ? of I:. Those are the only cases that may be allowed to be reimbursed under the referral pac"age. If the case is not found in the list, then the hospital cannot claim for reimbursement of the referral pac"age. +hat will happen is the first hospital will file a full claim and the second hospital where the patient was referred will also file a full claim. The system should detect an overlap and then $#/ will decide which of the claims to pay depending on where more services were done. *. Re&a#$in& the #e(e##a) ,a 3a&e4 h'1 1i)) the ,#'%i$e#s 3n'1 i( they a#e #e(e##in& t' a hi&he# )e%e) h's,ita)! .or the referral pac"age, our re uirement is a properly conducted referral. +e even have a referral form that should be filled out by the referring hospital. $oth these re uirements force the referring hospital to contact the referral hospital to properly endorse the patient at which point details of the referral hospital should be determined. #lso, it is part of the responsibility of the referring hospital to "now the classification and category of the hospital they are sending their patient to. 7atabases from 7-, and Phil,ealth may also be utilized. Hastly, it is high time that hospitals communicate with each other for the welfare of the patients.

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