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Related Experiment Videos

Nursing intensity billing.

John M Welton1, Mary Hughes Fischer, Sharon Degrace

  • 1College of Nursing, Medical University of South Carolina, Charleston, SC, USA. weltonj@musc.edu

The Journal of Nursing Administration
|April 13, 2006
PubMed
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A new nursing intensity billing model increased hospital charges by 32.2% by aligning costs with actual nursing care provided, unlike traditional room and board rates.

Area of Science:

  • Healthcare Finance
  • Nursing Administration
  • Hospital Operations

Background:

  • Traditional hospital billing uses fixed daily room and board rates.
  • This method obscures nursing care cost variability and misaligns charges with patient care.
  • A new model is needed to accurately reflect nursing costs.

Purpose of the Study:

  • To propose and evaluate a new nursing intensity billing (NIB) model.
  • To compare NIB with traditional room and board billing.
  • To assess the impact of NIB on hospital charges and cost distribution.

Main Methods:

  • Developed traditional and NIB charge methods for 12 medical/surgical units.
  • NIB assigned charges based on daily nursing intensity (actual nursing hours).

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  • Compared mean/sum of charges and nursing cost-to-charge ratios between methods.

    • Main Results:

    • The NIB model increased total charges by 32.2% ($4,870,250 over 5 months).
    • NIB reduced the variability of nursing cost-to-charge ratios (0.33-0.45 vs. 0.34-0.80).

    Conclusions:

    • NIB increased charges and more evenly distributed direct nursing costs.
    • Billing based on nursing intensity better reflects actual acute care.
    • NIB supports higher charge rates and redistributes costs based on nursing care.