MS-DRG Calculations (Level 4—Analyzing)
For this exercise, use the file titled AB202019_Ch05_Exercises.xlsx, tabs MS-DRG Calculation Example and
MS-DRG Calculations. This assignment consists of 10 inpatient acute-care admissions; 5 for Community
Hospital and 5 for Memorial Hospital. Calculate the MS-DRG reimbursement rate for each admission (there are
examples on the 1st tab of the file). Notice the fully adjusted base rate, charges, and cost-to-charge ratio are
different for each facility. Remember that the fully adjusted base rate already includes adjustments for IME,
DSH, and wage index.
AB202019_Ch05_Exercises.xlsx download
Once you have completed the calculations, answer the following questions. Submit both your MS-DRGs (60
pts) and the answers to the questions (40 pts).
Questions
Which figure has the biggest impact in determining profit/loss for an admission; base rate or cost-to-charge
ratio (CCR)? Why?
What is the definition of a CC/MCC? How does the presence of a CC/MCC code impact the reimbursement for
an admission
Why do surgical cases tend to have a higher relative weight (RW), and in turn payment, than medical cases?
What can Memorial Hospital do to improve their profit?