Medical Management Guide, 2009, Version 3.0 - Tricare

Medical Management Guide Version 3.0 Appendix C - DefinitionsPage 165Cost-Benefit AnalysisThe process of weighing the total expected costs vs. the total expected benefits of one or more actions in orderto choose the most profitable option. This often involves monetary calculations of initial expense vs. expectedreturn. It is usually done to decide whether to make a change or to determine how well, or how poorly, aplanned action (e.g., implementation of a program) will turn out. Also known as “running the numbers.”A cost-benefit analysis finds, quantifies, and adds all the positive factors. These are the benefits. Then itidentifies, quantifies, and subtracts all the negatives, the costs. The difference between the two indicateswhether the planned action is advisable. The real trick to doing a cost benefit analysis well is making sure youinclude all the costs and all the benefits and properly quantify them.Resources:About Business Management: http://management.about.com/cs/money/a/CostBenefit.htm.Covered EntityUnder the Health Insurance Portability and Accountability Act of 1996 (HIPAA), any entity that is:• A healthcare provider that conducts certain transactions in electronic form (called here a "coveredhealthcare provider").• A healthcare clearinghouse.• A health plan.Resources:Centers for Medicare & Medicaid Services (CMS): http://www.cms.hhs.gov/HIPAAGenInfo/06_AreYouaCoveredEntity.asp.Current Procedural Terminology ® (CPT)A coding system that describes the procedures, services, or supplies provided to patients within the outpatientsetting.Current Procedural Terminology ® (CPT), 4th Edition, is a listing of descriptive terms and identifying codes forreporting medical services and procedures. The purpose of CPT is to provide a uniform language that accuratelydescribes medical, surgical, and diagnostic services, and thereby serves as an effective means for reliablenationwide communication among physicians, and other healthcare providers, patients, and third parties.Resources:American Medical Association (AMA):http://www.ama-assn.org/ama/no-index/physician-resources/3882.shtml.Custodial CareThe treatment or services, regardless of who recommends treatment or services or which such treatment orservices are provided, that a) can be rendered safely and reasonably by a person who is not medically skilled orb) is/are designed mainly to help the patient with the activities of daily living.