Hospital Inpatient Product Self-funded employers can exercise control over escalating healthcare costs through better plan design development, cash flow improvement and more cost-effective claims payment. Employers can also protect against unforeseen catastrophic claims by purchasing stop-loss protection.Product Summary:This product is designed to accomplish two objectives for hospital groups who self fund their employee medical benefits. The first objective is to cover only those medical services which typically have a high degree of fluctuation in severity, which have historically been inpatient hospital claims.The second objective is to structure the reimbursement for domestic claims to correctly reflect that hospital’s cost of providing care to their own employees. The result of meeting these objectives is a lower cost reinsurance product which protects the hospital against only those medical claims which would jeopardize their employee welfare benefit plan. Identifying HIP Candidates:This product is not for all hospitals who self fund their employee medical benefits. The hospitals that would be most qualified are ones which can perform a high level of tertiary care services.We qualify hospitals for the HIP product by analyzing their ability to perform the following services:
We try to objectively measure a hospital’s ability to perform these services by utilizing the American Hospital Association Guide to services. If a candidate can perform enough services whereas the estimated percentage of the dollars exceeding the deductible is greater than 50%, we would consider them a “qualified” candidate.
Domestic Hospital Claim Reimbursement:The goal is to cover only the hospital’s cost of providing medical services to their own employees. This can be done through the use of artificial per diems, utilizing Medicare’s DRG Prospective Payment methodology or by employing the hospital’s cost to charge ratio. The preferred methods are the artificial per diems and Medicare allowable since they utilize fixed fee pricing.
Product Flexibility:One variation of this product that is available is the addition of outpatient facility services. The addition of these services would be beneficial for a client who is concerned about high cost drugs (e.g. blood factors, chemo drugs, etc.). A maximum limit of $500,000 is applied to these services.
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