1. What is OPPS Payment?

The Outpatient Prospective Payment System (OPPS) is how Medicare pays for hospital outpatient services. The payment amount is calculated by multiplying the DRG (Diagnosis-Related Group) weight by a conversion factor set by CMS.

2. How Does the Calculator Work?

The calculator uses the OPPS payment formula:

Where:

• DRG Weight — Relative weight assigned to the procedure or service (unitless)
• Conversion Factor — Dollar amount set by CMS for the year (USD)

Explanation: The DRG weight reflects the relative resources used for a procedure compared to other procedures. The conversion factor is updated annually by CMS.

3. Importance of OPPS Payment Calculation

Details: Accurate OPPS payment calculation is essential for hospitals to understand Medicare reimbursement rates and for proper financial planning and billing.

4. Using the Calculator

Tips: Enter the DRG weight (available from CMS tables) and the current year's conversion factor (published by CMS). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Where can I find DRG weights?
A: DRG weights are published annually by CMS in the Federal Register and on the CMS website.

Q2: How often does the conversion factor change?
A: The conversion factor is typically updated annually, though mid-year changes can occur.

Q3: Does this include all Medicare payments?
A: No, this is just the base payment. Additional payments (like outlier payments) may apply.

Q4: Are there geographic adjustments?
A: Yes, payments may be adjusted for local wage indexes and other geographic factors.

Q5: Can this be used for non-Medicare payers?
A: Some private payers use similar methodologies, but you should check their specific payment policies.