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Acute General Inpatient Hospital Reimbursement

Inpatient Hospital DRG Weights

Inpatient Hospital Base Rates

Additional Information


Acute Inpatient Hospital

Payment for admissions for all covered inpatient services rendered to Title XIX recipients admitted to acute care hospitals (other than Indian Health Facilities) on or after October 1, 2005, shall be made based on a prospective payment approach which compensates hospitals an amount per discharge for discharges classified according to the Diagnosis Related Group (DRG) methodology. Effective July 1, 2015, payment will not exceed billed charges. To classify hospital claims into DRG payments, OHCA currently uses Medicare grouper 32 and will transition to Medicare grouper 33 effective October 1, 2016. In the past, OHCA updated to the most current Medicare DRG grouper every January, but due to the implementation of ICD10, OHCA will update in October as Medicare does.

For each Medicaid recipient's stay, a peer group base rate is multiplied by the relative weighting factor for DRG which applies to the hospital stay. The result is the DRG payment to the hospital for the specific stay. In addition to the DRG payment, an “outlier” payment may be made to the hospital for very high cost cases. The outlier payment is calculated as follows: Outlier = (billed amount X cost to charge ratio) - (DRG weight X hospital base rate) - (threshold) X marginal cost factor of 70 percent or zero, whichever is greater. Effective July 1, 2015, the outlier threshold is $50,000 ($27,000).

The prospective payment rate shall include all items and non-physician services furnished directly or indirectly to hospital inpatients including but not limited to:

  1. Laboratory services;
  2. Pacemakers and other prosthetic devices including lenses and artificial limbs, knees and hips;
  3. Radiology services including computed tomography (CT) or magnetic resonance imaging (MRI) scans furnished to patient by a physician's office, other hospital or radiology clinic;
  4. Transportation, (including transportation by ambulance), to and from another hospital or freestanding facility to receive specialized diagnostic or therapeutic services.

Reimbursement on an inpatient claim includes preadmission diagnostic services provided to the patient within 72 hours of admission.

Beginning July 1, 2015, for transfers (indicated by patient status codes 02, 05, 43, 62, 63, 65, 66, 70, 82, 85, 90, 91, 93, 94, 95) to another facility, OHCA will pay the lesser of the transfer fee or Diagnosis-Related Group (DRG). In the case of a transfer, the Transfer Allowable Fee for the Transferring Facility shall be calculated as follows: Transfer Allowable Fee = (MS-DRG Allowable Fee/Mean Length of Stay) X (Length of Stay + 1 day). Payment to the receiving facility, if it is also the discharging facility, will be at the DRG allowable plus outlier, if applicable.

Out-of-state Specialty Services

The OHCA may negotiate a hospital-specific reimbursement agreement for unique expertise or specialized services not available in this state. Factors that the agency will consider in making the decisions to negotiate a facility-specific reimbursement agreement include:

  • the medical necessity for the out-of-state hospital service;
  • whether the service is widely available out-of-state or available only from a limited number of out-of-state providers;
  • the professional standing of the facility within the health care services community for the unique expertise or specialized service;
  • any extreme circumstance concerning the medical needs of the patient;
  • whether a facility-specific reimbursement agreement is necessary to ensure access to appropriate medical services which otherwise would not be vailable.


The Oklahoma Medicaid Program covers medically necessary transplants with prior authorization for in-state and out-of-state facilities.

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Last Modified on Oct 20, 2023
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