Medicare Wage Index

The Medicare wage index is calculated annually to determine the labor portion of the Diagnosis-related group (DRG) paid to PPS hospitals by CMS for Medicare patients. With each of the 456 CBSAs receiving its own wage index; the differences in the index, and associated payments, are considerable. We conservatively estimate that each 0.010 difference in the wage index equals approximately $70.00 for each Medicare discharge. With the high wage index around 1.8000 and the low around 0.7000, the difference in reimbursement is substantial.

R-C Healthcare was the first consulting firm to offer hospitals a review of their data from the Form S-3 to optimize it and the resulting reimbursement. Since then we have developed tools and processes to ensure that our clients receive the maximum revenue from Medicare. Each client receives direct attention from a principal of the firm who works with the hospital until the Final Rule is published in August of the following year.

R-C Healthcare understands that hospitals have different levels of need in preparation of their wage index revisions. Therefore, we offer two levels of consulting service to clients; the extensive Wage Index Expert Review (WIER) or the supporting level Wage Index Improvement Program (WIIP). Some clients opt for using both levels over a multi-year engagement.