Transparent Pricing Methodology
suite 200, 438 e wilson bridge road | worthington, oh 43085-2382
888-779-5663 | www.cleverleyassociates.com
Procedure Pricing Study
About the Procedure Pricing Study
The Procedure Pricing Study reviews a hospital’s prices at the procedure-code level and presents an
analysis of suggested rate changes designed to enhance the defensibility and transparency of
proposed pricing and to increase the amount of revenue collected per dollar of rate increase. This
analysis is designed to allow management to impose a variety of restrictions on rate increases.
Additionally, Cleverley + Associates uses line-item detail from recent claims. This enables a more
accurate review of projected recovery rates than simply using revenue-usage files.
Even if you have completed pricing analyses in the past, Cleverley + Associates can work with you to
sharpen your adjustments. Changes in payer mix and/or contract terms can introduce new issues
that Cleverley + Associates’ staff of analysts can help you resolve.
Methodology Overview
Data
Client-submitted
CDM
Itemized Bill
Files
Payer
Reimbursement
Terms
Modeling
Assumptions
Internal
Supply &
Pharmacy
Cost
Detail
Market-based
Pricing
Contracts
M o d e l i n g
Deliverables
Data
P h a s e
Modeling
Model Assumptions
During the final stage in the Procedure Pricing Study, Dr. William O. Cleverley will
assist you in creating a strategy for price adjustments, taking into consideration:
• Pricing transparency
• Cost-based pricing
• Across-the-board price adjustments
• Market-based pricing constraints
• Self-pay recovery
• Payer distribution
• Other unique situations
Flexibility of Modeling
By working directly with Dr. Cleverley and our staff of consultants, you have the
ability to fine-tune your constraints to meet your hospital’s unique needs. Even
if you are looking to remain revenue-neutral or strategically lower prices to align
with market needs, we can show you the most effective way to do so.
Deliverables
The Deliverables
 Price Defensibility Assessment
 APC Charge Analysis
 DRG Profile Report
 Major Payer Contract Analysis
 Exit conference call
 CDM Review
 Competitive Pricing Report
 Mark-up Comparisons
 Payer Impact
 Percentage Change in Charges by DRG
 Pricing Breakdown
 Pricing Breakdown with Formulas
 Procedure Pricing Recommendations
 Recovery Breakdown
 BETOS Groups
 Optimum Chargemaster
 Appendices A. B, C, and D – Charges by Payer, Charges and Profit by Revenue
Code, Charges and Profit by Department, Potential CDM Issues
Proven Results
Proven Results
Facility Name
Data on Cleverley +
Associates’ prior pricing
studies revealed:
Hospital 1
Hospital 2
Hospital 3
Hospital 4
Hospital 5
Allowed
Charge
Increase
$20,244,280
$91,516,220
$30,303,382
$91,075,840
$17,001,726
Incremental
Profit – ATB*
$8,961,894
$14,883,588
$8,770,136
$15,537,548
$3,721,988
Incremental
Profit w/Price
Constraint
$10,425,111
$18,027,984
$11,168,596
$19,488,578
$4,978,728
Incremental
Profit w/o Price
Constraint
$11,297,181
$18,555,780
$11,712,700
$20,086,510
$5,359,768
Difference
between ATB*
and Price
Constraints
$2,335,287
$3,672,192
$2,942,564
$4,548,962
$1,637,780
*Across-the-board
• Average profit from an
across-the-board (ATB)
rate increase was $10.8
million, or a recovery rate
of 15.6%.
• Average profit from
modeling with price
constraints to better align
hospital prices was $13.5
million, or a recovery rate
of 19.6%.
• On average, each study
generated $3.1 million of
additional profit over and
above an ATB increase
while keeping prices
better aligned with
competitors and other
market factors.
Conclusion
One of the reasons Cleverley + Associates is a leader in the industry is our
commitment to quality. We are with you every step of the way, helping you
build financial strength.
Contact Information
Address
438 e wilson bridge road, suite 200
worthington, oh 43085
Phone
888.779.5663
Fax
614.413.3455
Email
info@cleverleyassociates.com
Web
www.cleverleyassociates.com
www.transparentpricing.net
www.hospitaldx.com
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