Hospital bills vary for treatment of COVID-19, including charges for Veklury® (Remdesivir)
Background
ClaimDOC’s comprehensive line-by-line auditing of claims uncovers errors that basic claim repricing and auto-adjudication does not catch, leading to greater savings for health plans and its plan members. Our audit team analyzes all types of healthcare claims for a variety of potential concerns including excessive usual and customary charges, duplication of claims, correct coding edits, unbundling of services and many others. Our claims review is not intended to impact care decisions or medical practice.
In this Audit Spotlight, we focus on hospital-related charges for complex hospitalizations related to COVID-19 that require ventilation and/or admission to the intensive care unit (ICU) and noncomplex hospitalizations.
Hospital charges for COVID-19 hospitalizations vary extensively, depending on insurance, length of stay, severity, the number of diagnoses/conditions, treatments received, and the location/state where care is provided.
New HCPCS Code J0248
The Centers for Medicare and Medicaid Services (CMS) recently released a new Healthcare Common Procedure Coding System (HCPCS) code (J0248) for the VEKLURY (Remdesivir) antiviral medication for reporting/billing when administered in an outpatient setting, effective for dates of service on or after Dec. 23, 2021. Medicare administrative contractors determine coverage when there is no national coverage determination, including cases when providers use FDA-approved drugs for indications other than what is approved label. Current label information indicates the drug should only be administered in a hospital or healthcare setting capable of providing acute care comparable to inpatient hospital care.
Hospitals use CPT and HCPCS codes for purposes of charge capture, internal tracking, reporting, and billing of numerous items/services.
The CMS January 2022 Average Sales Price (ASP) Drug Pricing file reflects HCPCS code J0248, Injection, Remdesivir, 1 mg with a payment limit of $5.512. Medicare Part B provides reimbursement at a rate of the ASP plus a 6% add-on fee, a methodology that relies on market-based prices to set reimbursement rates. The 6% is provided as an add-on payment to cover expenses related to the needs of physician-administered drugs. When a dose of Remdesivir, 100mg is given, ASP pricing equates to $551.20. On the four case scenarios outlined below, hospital pharmacy charges for each injection of Remdesivir, 100 mg dose billed, range from $1,077.44 to $3,770, depending on the hospital.
Case Scenarios
Case 1
A 51-year-old plan member was admitted to a hospital in Wisconsin and had a nine-day inpatient stay. The primary ICD-10-CM diagnosis reported on the claim was U07.1, COVID-19. Additional diagnoses included pneumonia due to COVID-19, acute respiratory distress syndrome, obesity, and hypertension. The hospital submitted its services on a UB-04 claim form/electronic equivalent to insurance with total charges of $105,789.25.
High dollar charges included pharmacy for $58,449.75 and room and board for $21,207. The pharmacy charge for each Remdesivir 100 mg, injectable – $3,770.
Review of the hospital itemized bill identified unbundling of services part/partial to other reported/billed services.
Below is an overview of the hospital facility charges billed and related ClaimDOC pricing and savings:
- Total hospital billed charges: $105,789.25
- ClaimDOC Pricing: $43,953.70 (Based on Medicare 2021 MS-DRG 177- Respiratory Infections, with markup)
- Plan Savings: $61,835.55
- Percentage of Savings: 58%
Case 2
A 39-year-old plan member was admitted to a hospital in Connecticut and had a fifteen (15) day inpatient stay. The primary ICD-10-CM diagnosis reported on the claim was A41.89, Other specified sepsis. Additional diagnoses included COVID-19, acute respiratory distress syndrome, morbid obesity, COPD, hypertension, and others. The hospital submitted their services on a UB-04 claim form/electronic equivalent to insurance with total charges of $184,395.67.
High dollar charges included room and board for $87,157, pharmacy for $40,474.85 and laboratory for $24,604.36. The pharmacy charge for each Remdesivir 100mg, injectable – $1,077.44.
Review of the hospital itemized bill identified unbundling of services part/partial to other reported/billed services.
Below is an overview of the hospital facility charges billed and related ClaimDOC pricing and savings:
- Total hospital billed charges: $184,395.67
- ClaimDOC Pricing: $77,257.05 (Based on hospital’s cost-to-charge with markup)
- Plan Savings: $107,138.62
- Percentage of Savings: 58%
Case 3
A 49-year-old plan member was admitted to a hospital in Kentucky and had a forty-one (41) day inpatient stay. The primary ICD-10-CM diagnosis reported on the claim was U07.1, COVID-19. Additional diagnoses included acute respiratory failure, tachycardia, pneumonia due to COVID-19, acute kidney failure, morbid obesity, sepsis, asthma, and others. The hospital submitted its services on a UB-04 claim form/electronic equivalent to insurance with total charges of $430,430.49.
High dollar charges included pharmacy for $150,014.25, room and board for $77,184, laboratory for $51,681.76 and respiratory for $43,808.10. The pharmacy charge for each Remdesivir 100mg, injectable – $3,078.40.
Review of the hospital itemized bill identified unbundling of services part/partial to other reported/billed services.
Below is an overview of the hospital facility charges billed and related ClaimDOC pricing and savings:
- Total hospital billed charges: $430,430.49
- ClaimDOC Pricing: $165,607.69 (Based on hospital cost-to-charge with markup)
- Plan Savings: $264,822.80
- Percentage of Savings: 62%
Case 4
A 55-year-old plan member was admitted to a Florida hospital and had a five (5) day inpatient stay. The primary ICD-10-CM diagnosis reported on the claim was U07.1, COVID-19. Additional diagnoses included pneumonia due to COVID-19, diabetes, acute respiratory failure, obesity, and others. The hospital submitted its services on a UB-04 claim form/electronic equivalent to insurance with total charges of $58,508.20.
In this case, high dollar charges included pharmacy for $18,847.59, laboratory for $14,742.25 and room and board for $11,865.00. The pharmacy charge for each Remdesivir 100mg, injectable – $1,310.40.
Review of the hospital itemized bill identified unbundling of services part/partial to other reported/billed services and billing for professional charges on the incorrect claim form.
Below is an overview of the hospital facility charges billed and related ClaimDOC pricing and savings:
- Total hospital billed charges: $58,508.20
- ClaimDOC Pricing: $19,490 (Based on Medicare 2021 DRG 177 – Respiratory infections with markup)
- Plan Savings: $39,018.20
- Percentage of Savings: 67%
The Takeaway
The unbundling of services part/partial to other services reported/billed, professional charges submitted on the incorrect claim form, and egregious charges were observed on the above hospital itemized bills (IB) and insurance claims. While hospitals may charge any amount they elect for items/services provided, unbundling of services, incorrect reporting of services, and egregious fees can complicate matters for members to understand their bills and payments, impact the collection of patient balances, build a reputation of hospitals charging high fees, create burdens for patients having no insurance and a host of others.
Our goal at ClaimDOC is to use benchmark charges and costs nationally to negotiate fair and ethical payments. Employers turn to us to establish fair reimbursement rates for their plans allowing them to save money and provide richer benefits to their employees. A win-win for everyone.