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- Philip L Henneman, Brian H Nathanson, Haiping Li, Andrew Tomaszewski, Jesse M Pines, Daniel A Handel, and Michael J Lemanski.
- Tufts University School of Medicine, Boston, MA; Baystate Medical Center, Springfield, MA. Electronic address: philip.henneman@bhs.org.
- Ann Emerg Med. 2014 Apr 1; 63 (4): 404-11.e1.
Study ObjectiveWe determine the contribution margin per hour (ie, profit) by facility evaluation and management (E&M) billing level and insurance type for patients treated and discharged from an urban, academic emergency department (ED).MethodsBilling and demographic data for patients treated and discharged from an ED with greater than 100,000 annual visits between 2003 and 2009 were collected from hospital databases. The primary outcome was contribution margin per patient per hour. Contribution margin by insurance type (excluding self-pay) was determined at the patient level by subtracting direct clinical costs from contractual revenue. Hospital overhead and physician expenses and revenue were not included.ResultsIn 523,882 outpatient ED encounters, contribution margin per hour increased with increasingly higher facility billing level for patients with commercial insurance ($70 for E&M level 1 to $177 at E&M level 5) but decreased for patients with Medicare ($44 for E&M level 1 to $29 at E&M level 5) and Medicaid ($73 for E&M level 1 to -$16 at E&M level 5). During the study years, cost, charge, revenue, and length of stay increased for each billing level.ConclusionIn our hospital, contribution margin per hour in ED outpatient encounters varied significantly by insurance type and billing level; commercially insured patients were most profitable and Medicaid patients were least profitable. Contribution margin per hour for patients commercially insured increased with higher billing levels. In contrast, for Medicare and Medicaid patients, contribution margin per hour decreased with higher billing levels, indicating that publicly insured ED outpatients with higher acuity (billing level) are less profitable than similar, commercially insured patients.Copyright © 2013 American College of Emergency Physicians. Published by Mosby, Inc. All rights reserved.
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