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. 2004 Fall;26(1):85–101.

Table 2. Case-Level Inpatient Psychiatric Cost Regressions, Based on 1999 Data.

Independent Variable Dependent Variable

ln (Cost/Case) ln (Cost/Day) ln (Cost/Day)

Coefficient t Coefficient t Coefficient t



Wage Index: Ln 1999 Wage Index 0.849 44.99 0.664 108.790 0.670 124.33
Rural Location Indicator 0.175 20.24 0.149 53.120 0.023 9.03
Size: Ln ADC NA NA NA NA -0.172 -164.58
Occupancy: Ln Occupancy Rate 0.018 1.88 -0.279 -88.520 -0.126 -42.95
Teaching: Ln (1+ Residents to ADC) 0.402 12.53 0.523 50.340 0.598 65.17
Age Over 65 indicator 0.398 64.48 0.126 62.090 0.076 42.09
Length of Stay Indicators
1 Day NA NA 0.227 50.070 0.204 50.91
2-4 Days NA NA 0.116 46.300 0.092 41.45
5-8 Days NA NA 0.049 23.210 0.032 17.26
Comorbidity Indicators
HIV -0.056 -1.38 0.081 6.200 0.077 6.66
Hemophilia 0.045 0.26 0.122 2.160 0.137 2.74
Tracheostomy -0.197 -1.48 0.105 2.440 0.064 1.70
Psychiatric 0.148 3.80 0.032 2.500 0.025 2.24
Infectious Disease 0.099 4.22 0.068 8.990 0.050 7.48
ESRD Renal Failure Acute 0.021 0.36 0.090 4.780 0.071 4.28
ESRD Renal Failure Chronic 0.065 2.28 0.109 11.840 0.078 9.54
Malignant Neoplasms 0.033 1.07 0.089 9.030 0.065 7.48
Diabetes 0.199 3.61 0.105 5.870 0.069 4.36
Severe Malnutrition 0.216 2.20 0.114 3.610 0.101 3.62
Chemical Dependency -0.067 -2.81 0.015 1.990 0.018 2.60
Heart and Rheumatic Fever 0.154 1.57 0.150 4.730 0.129 4.62
Atherosclerosis with Gangrene 0.381 1.68 0.182 2.480 0.171 2.63
Chronic Respiratory Failure 0.106 3.36 0.107 10.490 0.079 8.78
Colostomy 0.172 3.56 0.108 6.910 0.070 5.06
Osteomelitis Gangrene 0.074 1.51 0.114 7.210 0.082 5.90
Poison -0.292 -6.97 0.136 9.990 0.096 8.04
Diagnosis Related Group (DRG) Indicators
424 Procedure Principal Group Indicator 0.690 14.42 0.206 13.280 0.173 12.62
425 Acute Adjustment Reaction -0.260 -10.75 0.092 11.730 0.064 9.20
426 Depressive Neurosis -0.455 -32.62 -0.003 -0.700 -0.008 -1.92
427 Neurosis, Except Depressive -0.462 -19.28 0.005 0.690 0.006 0.89
428 Disorders of Personality -0.219 -7.21 0.029 2.900 0.027 3.13
429 Organic Disturbances 0.029 2.93 0.021 6.450 0.015 5.19
431 Childhood Disorders -0.131 -2.86 -0.002 -0.160 -0.015 -1.14
432 Other Mental Disorders -0.184 -1.89 -0.070 -2.220 -0.024 -0.87
433 Alchohol/Drug Use, LAMA -1.072 -24.09 -0.120 -8.330 -0.081 -6.34
521 Alcohhol/Drug Use, W/CC -0.322 -13.93 0.027 3.630 0.031 4.76
522 Alchohol/Drug Use, W/O Rehab -0.152 -4.20 -0.022 -1.900 -0.018 -1.72
523 Alchohol/Drug Use, W/O Rehab -0.419 -29.80 -0.111 -24.230 -0.054 -13.28
012 Degenerative Nervous System Discord 0.066 4.45 0.061 12.700 0.014 3.30
023 Non-Traumatic Stupor & Coma -0.371 -4.74 0.087 3.440 0.098 4.39
Additional Control Variables
Ancillary Indicator 0.062 5.00 -0.265 -65.580 -0.093 -25.07
Year Indicator 0.039 3.56 0.026 7.200 -0.008 -2.69
Indicator for Occupancy Under 30% 0.117 8.19 -0.038 -8.180 -0.019 -4.70
Indicator for Occupancy Over 105% 0.478 7.06 0.100 4.570 0.079 4.10
Number of Observations 93,263 93,263 93,263
Degrees of Freedom 40 43 44
R2 0.1157 0.3149 0.467

NOTES: NA is not applicable. All LOS coefficients are relative to stays of more than 8 days. All DRG coefficients are relative to DRG 430 (Psychoses). The additional control variables were not used in any of the payment simulations. The ancillary indicator identified facilities that do not charge separately for ancillary services. The year indicator identified cases were 1998 Medicare cost reports were used to backfill for missing 1999 reports in constructing the dependent variable. The two occupancy indicators identified facilities with extremely high and low values.

SOURCE: Cotterill, P.G. and Thomas, F.G., Centers for Medicare & Medicaid Services, 2004.