Health Costs

How We Compute Total Costs Associated with Complex Tests and Services

Episodes of Care

In most cases, CompareMaine reports the costs for a single procedure, which may include both a professional and a facility component. For example, if you go to the hospital for an MRI, there will be a cost that is paid to the hospital (facility) and a cost that is paid to the radiologist (professional) that reads the MRI.

The surgical procedures we report on include the main procedure plus all related procedures or services that took place 30 days prior and 30 days after the main procedure, with the exception of a diagnostic episode, like colonoscopy, which is limited to the day of the procedure.

For example, a C-section episode may include the costs of ultrasounds, doctor appointments, blood work, surgeon fees, medications used before, during, and after surgery (like an epidural), a hospital stay, and follow-up appointments. For a knee replacement, there are tests, surgery, medical supplies, follow-up exams, physical therapy, and related medications.

We are using the Medical Episode Grouper© (MEG) by Truven Analytics in order to reflect a more complete picture of the episode cost for the following procedures:

  • Hip Replacement
  • Knee Replacement
  • Shoulder Arthroscopy
  • Knee Arthroscopy
  • Gallbladder Removal
  • Carpal Tunnel Surgery
  • Vaginal Delivery
  • C-section Delivery
  • Colonoscopy

The MEG uses clinically based logic to create groupings of claims. These episodes are built from the diagnosis codes that appear on the claim lines to ensure only relevant services are included; services performed at the same time but are not associated with the same diagnosis code would not be grouped into a given episode.

Bundled Services

Some procedures commonly occur with another procedure so we estimate their cost together as a “bundled service.” CompareMaine has three categories of bundled services:

Bloodwork: These are bundled with the cost of the blood draw (CPT Code 36415) and transportation of the sample to a lab when necessary (CPT Code 99000).

Non-Bloodwork Labs: These labs are bundled with the cost for transportation of the sample when necessary (CPT Code 99000).

Skin Lesions: There are two skin lesion procedures on CompareMaine:

  1. Removal of Precancerous Skin (CPT Code 17000): This is bundled with the cost of the office visit in which the removal occurs (CPT Codes 99385-99386, 99395-99396, 99201-99205, 99211-99215, 99381-99384, 99391-99394, 99241-99245), the biopsy (CPT Code 88305), and the pathology exam (CPT Code 11100).
  2. Removal of Noncancerous Skin (CPT Code 17110): This is bundled with the cost of the office visit in which the removal occurs (CPT Codes 99385-99386, 99395-99396, 99201-99205, 99211-99215, 99381-99384, 99391-99394, 99241-99245).

Severity of Episodes

Disease severity is a characterization of the seriousness of the current episode of care based on the progression of medical complications of the disease. For each episode, the MEG calculates a MEG Diagnosis Related Group (DRG) and assigns a severity stage based on the information that appears in the claim. There are four stages of severity:

Stage 0: History of, or exposure to disease.

Stage 1: Conditions with no complications or problems of minimal severity.

Stage 2: Problems limited to an organ system; increased risk of complications.

Stage 3: Multiple site involvement; generalized systematic involvement; poor prognosis.

Stage 4: Death

The median payment information that appears on the website is calculated by considering all episodes, regardless of severity. However, we are using the median to calculate the average cost and the median episode will typically have no complications or problems and minimal severity because these tend to be those most common type of episode.

Example: Calculating Costs Based on Stages of Severity

The example below demonstrates the median costs associated with a vaginal delivery at a facility where 80% of the episode count falls into Stage 1 and 20% in Stage 2 or 3. The median cost (in bold) is associated with Stage 1.

MEG DRG MEG Severity Stage Median Professional Cost Median Facility Cost Median Total Cost Episode Count
202 1.01 $5,492 $8,590 $14,082 2
202 1.02 $7,059 $17,801 $24,860 2
203 1.01 $4,456 $8,561 $13,135 311
203 1.02 $4,317 $8,488 $13,078 459
203 2.01 $4,337 $8,455 $12,735 35
203 2.02 $3,702 $9,003 $12,705 3
203 2.03 $4,226 $10,169 $13,602 18
203 2.04 $4,374 $10,927 $15,583 107
203 2.05 $4,552 $11,330 $14,059 11
203 2.06 $5,153 $11,945 $17,097 1
203 2.07 $5,771 $20,936 $26,706 2
203 3.01 $7,853 $15,632 $23,485 1
203 3.02 $5,348 $21,202 $26,600 4
203 3.04 $4,738 $12,388 $17,126 2
203 3.05 $4,729 $61,607 $66,336 1

Note: The majority of median estimates for surgical procedures on CompareMaine represent Stage 1 severity. All median estimates for both types of colonoscopy represent Stage 0 severity. A small portion of episodes, mostly gall bladder removal, represent Stage 2.