Patient Casemix Classification for Medicare Psychiatric Prospective Payment

Objective: For a proposed Medicare prospective payment system for inpatient psychiatric facility treatment, the authors developed a casemix classification to capture differences in patients’ real daily resource use. Method: Primary data on patient characteristics and daily time spent in various activities were collected in a survey of 696 patients from 40 inpatient psychiatric facilities. Survey data were combined with Medicare claims data to estimate intensity-adjusted daily cost. Classification and Regression Trees (CART) analysis of average daily routine and ancillary costs yielded several hierarchical classification groupings. Regression analysis was used to control for facility and day-of-stay effects in order to compare hierarchical models with models based on the recently proposed payment system of the Centers for Medicare & Medicaid Services. Results: CART analysis identified a small set of patient characteristics strongly associated with higher daily costs, including age, psychiatric diagnosis, d...