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New PEPPER Target: Severe Malnutrition

Published on 

Wednesday, January 12, 2022

 | Billing 
 | Coding 
 | OIG 
Did You Know?

Malnutrition and more specifically, severe malnutrition has been in the audit spotlight for several years. Historically, the OIG completed a series of reviews of hospitals with claims that included the ICD-9 diagnosis code for Kwashiorkor (260). In a December 2017 Report Brief (link), the OIG “reviewed the medical records for 2,145 inpatient claims at 25 providers and found that all but 1 claim incorrectly included the diagnosis code for Kwashiorkor, resulting in overpayments in excess of $6 million.”

They identified a discrepancy in the ICD-CM coding classification between the tabular list and the alpha index on the use of diagnosis code 260 and stated “CMS did not have adequate policies and procedures in place to address this discrepancy, resulting in a total potential loss of approximately $102 million during CYs 2006 through 2015. Even though CMS was aware of the discrepancy, it did not take any separate action to address it.”

In July 2020, the OIG published a Report Brief (link), looking at ICD-10-CM severe malnutrition diagnosis codes E41 (nutritional marasmus) and E43 (unspecified severe protein calorie malnutrition). The OIG found that 164 of 200 claims had billing errors resulted in net overpayments of $914,128 and stated, “the errors occurred because hospital used severe malnutrition diagnosis codes when they should have used codes for other forms of malnutrition or no malnutrition diagnosis code at all.” Based on the sample of claims reviewed, the OIG estimated hospitals received overpayments of $1 billion for FYs 2016 and 2017.

Most recently, in November 2021, the OIG added a review of Medicaid inpatient hospital claims with severe malnutrition to their Work Plan (link). The Work Plan issue description, indicates “adding an MCC to a claim can result in an increased payment by causing the claim to be coded in a higher diagnosis-related group.”

In addition to the OIG, the Q3 Fiscal Year (FY) 2021 Program for Evaluation Payment Patterns Electronic Report (PEPPER) became available and includes the new risk area, severe malnutrition. More specifically, this new PEPPER Target Area focuses on DRGs assigned based on an MCC with one of the following malnutrition ICD-10-CM diagnosis codes as the only MCC:

  • E40: Kwashiorkor
  • E41: Nutritional Marasmus
  • E42: Marasmic kwashiorkor
  • E43: Unspecific severe protein-calorie malnutrition

The Thirty-Fourth Edition of the Short-Term Acute Care PEPPER User’s Guide (link) provides the following guidance for hospitals that are high outliers for this new risk area:

“This could indicate that there are coding errors related to unsubstantiated coding of one of the severe malnutrition codes (i.e., E40, E41, E42, or E43) as the only MCC. A sample of medical records with a severe malnutrition code as the only MCC should be reviewed to determine whether coding errors exist. A diagnosis of severe malnutrition must be determined by the physician. A coder should not code based on laboratory findings or nutritional consultation without seeking physician determination of the clinical significance of the abnormal findings.”

Severe Malnutrition by the Numbers

As severe malnutrition has been and continues to be a focus of audit, I turned to our sister company RealTime Medicare Data (RTMD) to try and understand how often one of the above severe malnutrition ICD-10-CM diagnosis codes continues to be the only MCC coded on a record. RTMD data is Medicare Fee-for-Service specific and includes inpatient discharges, outpatient services, and CMS 1500 Professional services. It is full-census, non-modeled, and typically available 90 days post-payment.

The data provided by RTMD for this article includes calendar years (CYs) 2019 and 2020 inpatient claims for the entire RTMD footprint. Here is what I found.

CY 2019 and 2020 combined:

  • 188,383 total claims paid where a severe malnutrition code was the only MCC on the claim.
  • Actual Total Payment: Just over $2.9 billion
  • >
  • The five states with the highest number of claims for both CYs included Florida, California, New York, Texas, and Illinois.

CY 2019:

  • 102,874 total paid claims
  • Actual Total Payment: $1,543,413,978
  • Volume of claims by ICD-10-CM diagnosis code:
    • E40 Kwashiorkor – 13 claims
    • E41 Nutritional Marasmus – 235 claims
    • E42 Marasmic Kwashiorkor – 4 claims
    • E43 Unspecified severe protein-calorie malnutrition – 102,622 claims
  • Claims where one of the four severe malnutrition codes was the only secondary diagnosis on the claim:
    • 8,506 claims
    • Actual Total Payment: $114,480,291

CY 2020

  • 85,509 claims
  • Actual Total Payment: $1,367,094,959
  • Volume of claims by ICD-10-CM diagnosis code:
    • E40 Kwashiorkor – 12 claims
    • E41 Nutritional Marasmus – 117 claims
    • E42 Marasmic Kwashiorkor – 10 claims
    • E43 Unspecified severe protein-calorie malnutrition – 85,370 claims
  • Claims where one of the four severe malnutrition codes was the only secondary diagnosis on the claim:
    • 8,101 claims
    • Actual Total Payment: $114,246,389
Moving Forward
  • Make sure key stakeholders (i.e., Physicians, Coding Professionals, Clinical Documentation Integrity Specialists, and Registered Dieticians) at your facility are familiar with the 2012 ASPEN/AND criteria and the 2018 Global Leadership Initiative on Malnutrition (GLIM) criteria,
  • Partner with your medical staff to standardize the criteria your hospital uses to define the types of malnutrition (i.e., Kwashiorkor, Nutritional Marasmus),
  • Monitor your quarterly PEPPER to see if your hospital is an outlier in this risk area,
  • Respond in a timely manner to medical record requests made by auditing entities.
Article Author: Beth Cobb, RN, BSN, ACM, CCDS
Beth Cobb, RN, BSN, ACM, CCDS, is the Manager of Clinical Analytics at Medical Management Plus, Inc. Beth has over twenty-five years of experience in healthcare including eleven years in Case Management at a large multi-facility health system. In her current position, Beth is a principle writer for MMP’s Wednesday@One weekly e-newsletter, an active member of our HIPAA Compliance Committee, MMP’s Education Department Program Director and co-developer of MMP’s proprietary Compliance Protection Assessment Tool.

This material was compiled to share information.  MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.