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Cost to Charge Ratio and How to Change Yours

Cost to Charge Ratio and How to Change Yours

Your provider number has a strong impact on your medical billing cost to charge ratio (CCR). If your hospital is merging with another hospital, it is important to figure in the possibly new Cost to Charge Ratio medical billing payments you will receive.

There are two avenues merging hospitals can take. The first method is when two hospitals merge together while one of the existing provider numbers is kept in tact. In this instance, one hosptial keeps their medical billing number, while the other one drops theirs and joins the first. The hospital that drops their medical billing provider number will receive a new cost to charge ratio. The ratio will be figured from the hospital with the existing provider number.

The second scenario involves a brand new medical billing provider number for the merging hospitals. When each hospital forfeits their provider number, a new provider number is formed. In this instance, there is no prior history to conduct a cost to charge ratio study. Instead, the merging hospitals will use the statewide average medical billing Cost to Charge Ratio until they have history.

If the Cost to Charge Ratio assigned to your hospital is unsatisfactory to your liking, you can request a lower or a higher number. However, there must be substantial evidence to back up your claim. Medical billing cost to charge ratios are difficult to change because they need to be fair to all hospitals involved.

The bottom line is: make sure your hospital is ready for medical billing reimbursement changes if you are merging with another facility. The failure to prepare for such changes could severely impede your financial and medical billing departments for a long time to come. Once your revenue flow is slowed down it can take a long amount of time to recover.

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