Mastering The Financial Complexities of Transplant Procedures

The Medicare program continues to reimburse hospitals for the full reasonable costs associated with the acquisition of organs for transplant to Medicare beneficiaries, which are determined on the Medicare cost report. Allowable organ acquisition costs include organ donor and recipient costs before hospital admission for the transplant operation and the hospital inpatient costs associated with the donor. As part of the cost determination process, costs must be properly classified as pre-transplant, post-transplant or non-transplant.

It is, of course, important for transplant centers to receive all the Medicare reimbursement to which they are entitled. At the same time, organ acquisition costs have been the subject of interest and audit by the OIG. In an OIG audit of 11 Certified Transplant Centers, the OIG audit found unallowable costs of almost $47 million out of a total cost audited of approximately $80 million. According to the audit report, "officials at the 11 centers either asserted that they lacked awareness and understanding of Medicare requirements for claiming organ acquisition costs or stated that they had inadvertently claimed costs that were not allowable as organ acquisition."

The complete and proper determination of all reimbursable costs requires the participation of many individuals who are knowledgeable regarding the Medicare regulations. These individuals include not just finance and reimbursement, but also individuals that are responsible for patient revenue generation, CDM and transplant office administrators and care givers. In our experience, too often individuals who play an important role in this process are lacking in a sufficient understanding of the reimbursement mechanisms and how their function impacts the hospital's reimbursement. Medicare provides specific documentation, coding and billing guidance dependent upon when the service was performed (pre-transplant, post-transplant), who performed the service (technical versus professional) as well as the following service types:

  • Tissue typing & pre-transplant evaluations;
  • Excision of live (kidney) and cadaver organ;
  • Services to donors (kidney) prior to, during and after transplantation;
  • Transplant surgery;
  • Transplant complications;
  • Immunosuppressive drugs and management.

Complicating matters, the guidance varies based on the type of organ being transplanted.  Medicare coverage guidelines and limitations must be carefully adhered to and documentation in the medical record should be thoroughly evaluated.

Developing and conducting in depth training programs for everyone involved in the Transplant Revenue Cycle process ensures all individuals who have a role in the organ acquisition understand how important it is to properly identify pre-transplant, post-transplant and non-transplant patients and the accompanying charges to ensure appropriate reimbursement based on services performed, and mitigate risk.

If you are interested in discussing your Transplant Service program, or wish to conduct a comprehensive assessment or training program, SunStone offers a suite of customized, on-site training seminars for staff and physicians involved in the Transplant Service Line.  For more information, please do not hesitate to contact Jim O'Connell, Principal at Or Vonda Moon, Principal, at