Running head: FINANCIAL ANALYSIS
1
Financial Analysis
NNP Group I
Presented to:
Debra Armentrout, RN, NNP-BC, MSN, PhD and
Carole Mackavey, RN, MSN, FNP-C
In Partial Fulfillment of GNRS 5350: Professional Roles and Business Principles
By:
Lynette Barnhart, Shayna Bauman, Rosa Carranza, Marissa Hampton, & Magidah Kobty
On
July 20, 2014
University of Texas Medical Branch at Galveston
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FINANCIAL ANALYSIS
Neonatal Intensive Care Unit Financial Analysis
The following is a financial analysis for a Neonatal Intensive Care Unit (NICU)
stay for a typical, uncomplicated 28-week preterm infant. This infant resided in the NICU
for 10 weeks prior to his discharge at 38-weeks post conceptual age. This paper will
cover the accrued costs of a NICU stay, including staff wages, necessary procedures,
supplies, laboratory testing, medications, and other essential equipment. This analysis
will determine whether it is beneficial and profitable for an independent Neonatal Nurse
Practitioner (NNP) to bill for these charges, rather than bill with a collaborating physician
or NNP practice.
Charges for 10-Week Stay
The birth, stabilization and eventual discharge of a premature infant requires
extensive resources, medical personnel and supplies. Multiple summaries of the resources
needed to provide care for a premature infant were compiled. Charges pertaining to the
infant’s hospital stay were collected and placed into table format.
First, Table 1 in Appendix A cites the average salary charge for a medical
provider to oversee the infant’s care in the NICU. These are expected daily charges for
initial providers, given the infant’s uncomplicated stay. Depending on the infant’s
condition, additional specialist may be required; however, their costs per day are not
included in appendix A.
Table 2 details typical admission charges including supplies and medications for a
28 week infant. Tables 3 and 4 provide a breakdown of charges for an established Level
III and Level I/II NICU patient. Included in these tables are all costs that were anticipated
for care. The daily supply costs in tables 3 and 4 include necessary minor medical
FINANCIAL ANALYSIS
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equipment needs such as electrode leads, pulse oximeters, bilirubin masks, orogastric
tubes, tape, medication tubing, etc. Finally tables 5 and 6 identify CPT billing codes and
ICD-9 Diagnoses Codes. These codes are generated during hospitalization and are used
to justify charges and to bill appropriately.
Itemized costs and health care coverage for NICU admission
In the United States, the leading cost factor for infant hospitalization is preterm
birth. In a 2001 study by Nationwide Inpatient Sample from the Healthcare Cost and
Utilization Project, infant health care costs were compared (Russell, et al 2007).
Uncomplicated term babies, preterm and extreme preterm infant’s hospital stays were
analyzed. Infants with complicated medical diagnosis were not excluded. Length of stay
and re-hospitalization were major contributory factors related to increased costs. The
study concluded that total costs for preterm births amounted to approximately ~47% of
all infant hospitalizations. Furthermore, costs were highest for infants whom were born
extremely premature (<28 weeks) and whose courses were complicated with respiratory
illness (Russell et al, 2007).
The study included estimated overall costs according to length of stay and
primary method of payment. Sources cited that half of overall costs were projected to be
covered by primary or commercial insurance and about 42% covered by Medicaid
(Russell et al, 2007).
A preterm birth at 28 weeks allows for extended hospitalization until a corrected full
term gestation is reached. The following is a list of expected resources needed for a 28week infant with an uncomplicated course until discharge:

Delivery attendance by NICU team
FINANCIAL ANALYSIS

NICU admission charge

Acuity charge for each day of hospitalization

Physician and practitioner charge for each day of hospitalization

Bed charge for each day of hospitalization

Nursing care charge for each day of hospitalization
Tables 3 and 4 in Appendix A outline anticipated costs and supplies related to the
uncomplicated medical coverage of a 28 week infant. Costs include:

Intubation procedure charge:
o Supply cost for: Endotracheal tube, CO2 detector, suction catheters

Ventilatory support:
o Ventilator, bubble CPAP, nasal cannula support

Line insertion procedure charge:
o Supply cost for: 3.5 Fr double lumen umbilical catheter, 3.5 Fr single
lumen umbilical catheter, line placement catheter tray.
o PICC insertion: Procedure cost and supplies

PICC tray, PICC lumen catheter
o Additional costs for line placement:


Sterile gowns, gloves, hat and mask

IV supplies, needles
Intravenous fluids (IVF) or nutrition charges for:
o IV tubing, transducer
o Clear IVF: Dextrose, electrolytes, heparin on DOL 1
o Total parental nutrition for remainder of IV nutrition
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FINANCIAL ANALYSIS
o Intralipid solution for remainder of IV nutrition

Nutritional charges
o Enteral nutrition: Supplementation with donor breast milk, Prolacta,
human milk fortification (HMF), MCT oil, formula

Medications charges in uncomplicated course:
o Admission: Vitamin K, Erythromycin, possible surfactant therapy
o Possible prophylactic antibiotic therapy
o Caffeine Citrate

Laboratory charges in uncomplicated course:
o Admission: Blood culture, CBC, blood gas, bedside blood glucose, type
and cross
o Future blood testing: Repeat Complete metabolic panels (CMP), repeat
CBCs, repeat bedside blood glucose
o Newborn Screening 1 and 2, possible supplemental screen if indicated

Radiology charges in an uncomplicated course:
o Serial Chest/ abdominal x rays
o Head ultrasounds

Ophthalmology charges for eye exams

Additional therapy charges:
o Physical/Speech therapy

Discharge charges:
o Hearing screen
o Immunizations
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FINANCIAL ANALYSIS

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Miscellaneous charges for generally uses items:
o Admission items: Thermometer, blood pressure cuff, pulse oximetry
probe, tape measures
o Diapers, Wipes, diaper cream, bath items
o Feeding supplies: Nipples, bottles, feeding tubes and syringes
o Lactation supplies: breast pump items, nipple shields
Costs of these supplies and services are dependent on the individual’s medical
coverage. The neonate’s eligibility for Medicaid coverage is regulated by state guidelines.
Under federal guidelines, states establish and mandate their own Medicaid programs.
Within these regulations, each state would determine the type, amount, duration and
scope of services covered (Medicaid, 2014). As part of federal guidelines, mandatory
Medicaid coverage includes inpatient hospital services (Medicaid, 2014). Infants who are
born prematurely may qualify for complete coverage of their hospital stay. In the state of
Texas, mothers and infants who are ineligible for Medicaid services may qualify for
CHIP services. Although limited in their coverage as opposed to Medicaid services,
CHIP provides financial coverage for delivery of the infant. Private insurance coverage
for the infant in NICU will vary according to provider and policy. Therefore, payment of
the overall bill is dependent upon the approval of the insurance company.
Summary of Ease or Difficulty of Success in Independent NNP Practice
NNPs are an integral part of the healthcare team. Their education and scope of
practice allow them to attend high-risk deliveries, perform invasive procedures, and
develop management plans for both acute and primary care. However, NNPs are
confronted with various practice barriers that may make billing for services as
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FINANCIAL ANALYSIS
independent practitioners difficult. Texas is not one of the 22 states that allow advanced
practice registered nurses (APRNs) to practice autonomously (National Association of
Clinical Nurse Specialists, n.d.). The majority of states continue to require physician
collaboration for prescription of controlled substance by APRNs, including NNPs. In
addition to state restrictions, independent hospitals may require additional supervision on
NNPs for credentialing and for extension of hospital privileges to them. NNPs can also
face lost revenue from third party payers due to institutional, practice, or regulatory
barriers. For advanced practice registered nurses, additional reimbursement regulatory
requirements include national APRN certification. Furthermore, Medicare does not
distinguish between different APRN roles; therefore, NNPs and neonatal clinical nurse
specialists (NCNSs) bill and receive reimbursement rates based on their scope of practice
as defined by their individual states. Since licensing is state based, there are wide
variations in scope of practice, further complicating reimbursement. Medicare will
reimburse APRNs for direct care; however, reimbursement rates vary by state, and may
be lower than the physician rates. All these barriers and restrictions can make it difficult
for NNPs to independently bill for services and generate profits (National Association of
Neonatal Nurses & National Association of Neonatal Nurse Practitioners, 2014).
Conclusion
It is without question that NNPs are essential for a well functioning NICU
environment. From delivery stabilization to daily management and care, the NNP is one
of the key players in dictating an infant’s care during their stay in the NICU. The multiple
hurdles that the independently practicing NNP would encounter, such as equipment,
salaries, and supplies, may make it difficult for a standalone NNP to generate profits
FINANCIAL ANALYSIS
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without the help of a collaborating physician group. Furthermore, an in-depth knowledge
and understanding of accurate CPT and ICD-9 codes is imperative for the success of
healthcare based businesses in order to generate profits. State restricted reimbursement
rates also need to be digested and studied prior to opening a NNP standalone practice.
Although these obstacles do exist, an independently functioning NNP would provide a
wealth of knowledge to smaller communities who previously lacked neonatal services,
and could offer exceptional neonatal care to their community’s sick infants.
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FINANCIAL ANALYSIS
References
Medicaid. (2014). Medicaid benefits. Retrieved fromhttp://www.medicaid.gov/MedicaidCHIP-Program-Information/By-Topics/Benefits/Medicaid-Benefits.html
National Association of Clinical Nurse Specialists. (n.d.). Scope of practice FAQs for
consumers: Advanced practice registered nurses (APRNS). Retrieved from
http://www.nacns.org/docs/toolkit/3A-FAQScope.pdf
National Association of Neonatal Nurses & National Association of Neonatal Nurse
Practitioners. (2014). The future of neonatal advanced practice registered nurse
practice: White paper. Retrieved from
http://www.nannp.org/uploads/files/Future_of_APRNs_white_paper_FINAL.pdf
Russell, R. B., Green, N. S., Steiner, C. A., Meikle, S., Howse, J. L, Poschman, K., Dias,
T.,Potetz, L., Davidoff, M. J., Damus, K. & Petrini, J.R. (2007). Cost of
Hospitalization for Preterm and Low Birth Weight Infants in the United States.
Pediatrics, 120(1), 1-9. Doi:10.1542/peds.2006-2386
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FINANCIAL ANALYSIS
Appendix A
Table A 1
Salary Charges for a 10 Week NICU Stay
Hourly Wage
Days Used
Total Cost ($)
Neonatologist
$72
X 24hours/ day
70
120,960
Neonatal Nurse
Practitioner
$45
X 24 hours/day
70
75,600
Registered Nurse
$30
X 24 hours/day
70
50,400
TOTAL
$ 226,960
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FINANCIAL ANALYSIS
Table A 2
Admission Charges for a 28 week Infant
Cost ($)
NICU Team Attendance at delivery
62.60
NICU Daily room charge
4,859.00
Umbilical artery line (UAC) placement
58.33
Umbilical venous line (UVC) placement
87.58
Endotracheal intubation (ETT)
604.00
Ventilator initial days
3,925.00
O2 Daily
457.00
Ampicillin dose
82.44
Gentamicin dose
74.62
Caffeine dose
153.55
Vitamin K
77.67
Erythromycin
Curosurf dose X 1
51.15
4,906.89
Blood type and Screen and Antibody screen
89.00
Complete Metabolic Panel
351.90
Blood Culture
219.60
Arterial blood gas (ABG)
235.30
Complete blood count (CBC)
134.80
Glucose check
17.50
Abdominal X-ray
Chest X-ray
257.00
167.00
Neonatal TPN
1,482.00
Lipids
102.11
UAC IVF
135.83
Equipment Supply Charge
161.81
TOTAL
$18,753.68
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FINANCIAL ANALYSIS
Table A 3
Charges for an Established Patient: Level III (6 weeks: 28-34 weeks CGA)
Cost ($)
Days
Total Cost ($)
Daily NICU Room Charge
4,859
42
204,078
Daily Supply Charge
161.81
42
6,796.02
Ventilator Subsequent Day
3,270
14
45,780
CPAP
735
14
10,290
Nasal Cannula
1,31
14
14,434
Caffeine
153.55
42
6,449.10
Ampicillin (Q12X 48 hours)
82.44
4
329.76
Gentamicin (Q24 X 28 hours)
74.62
2
149.24
ABG (Q 12 hours X 2 weeks, Q Day X 1 week)
235.30
35
8,235.50
CBC (Q Monday)
134.80
6
808.80
CMP (Q Monday)
351.90
6
2,111.40
Bedside Glucose (Q12 X 2 weeks)
17.50
14
245
Newborn Screen
112.70
2
225.40
PICC line
621
1
621
TPN (2 weeks)
1482
14
20,748
Lipids (2 Weeks)
102.11
14
1,429.54
Human Milk Fortifier (Once off TPN, 4 weeks)
48
14
672
UAC IVF
135.83
7
950.81
Multivitamin (Twice a day X 4 weeks)
76.73
56
4,296.88
Hepatitis B Vaccine (One month old)
138.63
1
138.63
Chest Xray (6)
167
6
1,002
Abdominal Xray
257
6
1,542
HUS (7 days old and 6 weeks old)
685
2
1,370
ECHOCARDIOGRAM
2708
1
2,708
TOTAL
$335,411.08
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FINANCIAL ANALYSIS
Table A 4
Charges for an Established Patient: Level I/II (4 weeks: 34-38 weeks CGA)
Cost ($)
Occurrences
Total ($)
Continuing Care Nursery Room
2914
28
81,592
HUS (Prior to discharge)
685
1
685
CBC (Weekly)
134
4
536
Multivitamin (BID X 4 Weeks)
76.73
56
4,296.88
Human Milk Fortifier
48
14
672
TOTAL 87,781.88
Table A5
CPT Billing Codes Used During Hospitalization
Code
Attendance at Delivery
99464
Newborn Resuscitation
99465
Initial Inpatient NICU Care
99468
Initial Admit Comprehensive, High Complexity
99223
NICU Care, Subsequent Days (28 days and less)
99469
Critical Care , Subsequent Days (>29 days)
99471
Endotracheal intubation
31500
Catheterization, umbilical vein
36510
Catheterization, umbilical artery
36660
Placement of PICC
36568
Hospital discharge (>30minutes)
99239
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FINANCIAL ANALYSIS
Table A 6
ICD-9 Diagnosis Codes Used During Hospitalization
Diagnosis
Code
Acidosis of Newborn
775.81
Anemia of Prematurity
776.6
Apnea of Prematurity
770.81
Impaired nutrition in the newborn
779.31
BPD
770.7
28 week Preterm Infant
765.24
Respiratory Distress Syndrome
769
Hypoglycemia
775.6
IVH
772.10
PDA
747.0
Single Liveborn born in hospital
V30.00
Observation for Infection
V29.0