Healthcare Payments

What’s the process for calculating average total payments?

The payment data on CompareMaine originates from the Maine Health Data Organization’s All-Payer Claims Data (APCD) and represents claims data submitted by commercial payors in the State of Maine as required in 90-590 CMR Chapter 243, Uniform Reporting System for Health Care Claims Data Sets, for the reporting period April 1, 2022 – March 31, 2023. CompareMaine does not include information on the uninsured or public payors (Medicare and MaineCare). A total of 9,876,343 healthcare claims from 28 commercial payors were analyzed in the development of the payment estimates.

The payment estimates on CompareMaine are calculated based on the median total payment amounts reported by insurance companies submitting data to MHDO and serve as a reference point for comparison. MHDO makes every effort to provide accurate information on this website. Healthcare settings and insurance companies included on CompareMaine are sent the payment data to review for accuracy before it is published. Payments presented on this website are within 10% of estimated payments from healthcare settings and payors.

Medical payments are made using a few different methods, which can vary depending on the specific healthcare setting and payor. The primary payment methods used in Maine are discount-off charges, ambulatory payment classification (APC), diagnosis related groups (DRG), and a payer-based fee-schedule. For a single procedure at a healthcare setting, it is possible that different payment methods were used by different insurance companies. This may result in variations in the median payments shown for each insurance company, more so than when all insurance companies use the same payment method.

Please contact your insurance company to find out your actual payment. If you do not have insurance, please contact the healthcare setting that you are interested in to discuss what you may be asked to pay.

The Steps MHDO Takes to Calculate Procedure Payments on CompareMaine

Step 1: Filter the Data

We filter the data by removing claims with missing information, claims from public payors (Medicare and Medicaid), and commercial claims for anyone 65 years old or older, as these claims are often paid for in-part by a public payor like Medicare and including them would distort the average. We do not calculate a payment estimate for a specific procedure if the healthcare setting has fewer than five claims for that procedure in the APCD.

Incomplete Encounters: For procedures that require both professional and facility services, we remove patient encounters that do not include both a professional and facility claim from our estimates.

Encounters Without Payment Data: We remove claims that do not have payment information.

Step 2: Find Claims Associated with a Service or Procedure

We find the claims associated with the specific healthcare service or procedure. Depending on the healthcare setting and the procedure, the total payment can include multiple components:

Technical Component (comes from a UB-04 claim form or a CMS 1500 with a technical modifier): The portion of the payment that covers expenses associated with items like the use of the facility, equipment, supplies, and non-physician medical staff. The technical component may also be referred to as a facility fee.

Professional Component (comes from a CMS 1500 claim form): The portion of the payment that covers expenses associated with the services provided by physicians, suppliers, and non-institutional providers. The professional component may also be referred to as a professional fee.

Note: When more than one healthcare setting provides care, all healthcare setting costs are attributed to the setting with the largest portion of the payment.

The payment breakdown also displays:

Number of Procedures: How many procedures at the healthcare setting are used to calculate the estimated payment.

Count of Procedures: Approximately how many times the healthcare service or procedure was performed during the reporting period of interest for insured individuals (includes commercial and public payors).

Please visit the list of all services and procedures to see which payments are included in each estimate.

Step 3: Calculate the Average Payment

We use the median value rather than the mean to calculate the average payment for each service or procedure at each healthcare setting. The median is the middle value when all items in a sample are sorted from lowest to highest, whereas the mean is calculated by adding up all the values and dividing by the number of items in the sample. The mean is affected by extreme values that are very high or very low compared to the rest of the sample. The median is less likely to be influenced by extreme values and therefore a better representation of the average payments.

When you use CompareMaine, you can filter average total payments by a specific insurance company. If you do not choose an insurance company, the estimate shown is the median payment for the service or procedure at the healthcare setting across all insurance companies reported in the MHDO’s APCD.

Bundled Services

There are procedures that commonly occur with another procedure. In these cases, we estimate the payments together as a “bundled service.” CompareMaine has three categories of bundled services:

Bloodwork: Bloodwork procedures are bundled with the payment for the blood draw (CPT Code 36415) and transportation of the sample to a lab, when necessary (CPT Code 99000).

Non-Bloodwork Labs: Non-Bloodwork procedures are bundled with the payment for transportation of the sample to a lab, when necessary (CPT Code 99000).

Skin Lesions:

  1. Removal of Precancerous Skin (CPT Code 17000): This procedure is bundled with payments for at least one of the following CPT Codes in each code set: Office visit in which the removal occurs (CPT Codes 99385-99386, 99395-99396, 99202-99205, 99211-99215, 99381-99384, 99391-99394, 99241-99245), the biopsy (CPT Code 88305), and the pathology exam (CPT Codes 11102, 11104, 11106).
  2. Removal of Noncancerous Skin (CPT Code 17110): This procedure is bundled with at least one payment from the following CPT Codes for the office visit in which the removal occurs: CPT Codes 99385-99386, 99395-99396, 99202-99205, 99211-99215, 99381-99384, 99391-99394, 99241-99245.

Emergency Department Visits

There are five Emergency Department (ED) CPT Codes:

  • Emergency department visit, very minor (CPT Code 99281)
  • Emergency department visit, low complexity (CPT Code 99282)
  • Emergency department visit, moderate severity (CPT Code 99283) – represents 29.1% of ED claims in Maine’s APCD
  • Emergency department visit, problem of high severity (CPT Code 99284) – represents 39.4% of ED claims in Maine’s APCD
  • Emergency department visit, problem with significant threat to life or function (CPT Code 99285)

We calculate estimates for ED visits based on claims from the same member on the same day that have any of the five ED CPT Codes listed above. The “lead code” is the CPT Code associated with the healthcare setting component of the claim, while the professional component can be any of the five ED CPT Codes. For example, if the healthcare setting component of an ED episode is CPT Code 99283, the claim will be associated with that CPT Code, regardless if the professional component is CPT Code 99821, 99282, 99283, 99284 or 99285.

Services Measured in Units

For certain CPT Codes, units are normalized to one unit per payment. Healthcare services such as office visits, mental and behavioral health, nutrition therapy, and physical and occupational therapy are measured in time increments, referred to as “units.” These units typically represent 15 minutes of time. Multiple units of different types of services may be provided during one appointment. Other healthcare services are measured in units but are not time-based, such as laboratory services measured per specimen and radiology and imaging services measured per view.

The National Correct Coding Initiative (NCCI) Medically Unlikely Edits (MUEs) files from the Centers for Medicare & Medicaid Services (CMS) are used to categorize CPT Codes into non-units-based or units-based estimates as described below. CompareMaine has adopted this methodology in our effort to enhance the way we normalize healthcare services and procedures that are units-based and the cost estimates associated with them.

  • Non-Units-Based: If a CPT Code displayed on CompareMaine has a maximum number of acceptable units equal to one, as per the MUE files, the CPT Code is classified as a non-units-based, and estimated payments are calculated as usual by healthcare setting and payor.
  • Units-Based: If a CPT Code displayed on CompareMaine has a maximum number of units more than one, as per the MUE files, the CPT Code is classified as units-based, and we calculate the payment per unit by taking the total payment of the procedure and dividing it by the number of units of the CPT Code on the claim. Units may be billed separately on the same day for the same procedure. When there are multiple claims or multiple service lines for a CPT Code for the same individual on the same day (referred to as an “episode of care”), we take the sum of all payment information across claims and/or service lines for that CPT Code and divide by the total number of units of that CPT Code across the episode of care. Next, we calculate the median estimated payment across all claims as usual by healthcare setting and payor. For units-based CPT Codes, CompareMaine displays the average number of units per episode in the procedure description on the Compare Costs & Quality pages.

Guidelines from the MUE files are used to determine the acceptable maximum number of units for CPT/Healthcare Common Procedure Coding System (HCPCS) on the same service date for the same patient, and are based on procedure code descriptors, CPT instructions, CMS policies, the nature of a service or procedure, equipment, CMS data, and clinical judgment. View the files for Medicare and Medicaid.

For example, you may receive 30 minutes (2 units) of therapeutic exercise and 15 minutes (1 unit) of ultrasound therapy. To estimate the average total payment, multiply the payment of therapeutic exercise by two and the payment of ultrasound therapy by one, then add the two payments together. If you have more than one service during the same visit, you need to look up each service separately. Your healthcare provider can share information about what services, including the number of units of each service, will likely be billed during your course of treatment.

Example: Calculating Average Payments Using the Median

In this example, the payments are the same at the two labs for the first four patients’ blood tests. However, Patient E’s blood test costs $200 more at Lab 2 than at Lab 1. The median or middle value stayed the same at the two labs. But the mean payment for blood testing is $40 more at Lab 2 (bumped up by the more expensive testing for one patient, Patient E). The median payment, $100, is a better example of what blood testing costs.

Patient Lab 1 Costs Lab 2 Costs
Patient A's Blood Test $50 $50
Patient B's Blood Test $50 $50
Patient C's Blood Test $100 $100
Patient D's Blood Test $100 $100
Patient E's Blood Test $150 $350
Total Sum of Blood Testing $450 $650
MEDIAN Cost (middle value in list, Patient C) $100 $100
MEAN (Total Sum/Total Number of Tests) $90 $130

Step 4: Link the Average Payment to a Healthcare Setting

We determine the healthcare setting the payment should be assigned to on CompareMaine. When more than one healthcare setting provides care, the healthcare setting with the largest portion of the payment is identified as the "Lead Healthcare Setting" on CompareMaine.