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At least annually, DRG classifications and relative weights are adjusted to reflect changes in treatment patterns, technology, and other factors that may change the relative use of hospital resources. This week is the third and final article in our series about the FY 2018 IPPS Final Rule. We finish by sharing several of the changes to the Medicare Severity Diagnosis-Related Group (MS-DRG) Classifications.   

MDC 1: Diseases and Disorders of the Nervous System

Functional Quadriplegia

Section 1.C.18.f of the FY 2017 ICD-10-CM Official Coding Guidelines addresses coding the diagnosis of functional quadriplegia. “Functional quadriplegia (described by diagnosis code R53.2) is the lack of ability to use one’s limbs or to ambulate due to extreme debility. The condition is not associated with neurologic deficit or injury, and diagnosis code R53.2 should not be used to identify cases of neurologic quadriplegia. In addition, the Guidelines state that the diagnosis code should only be assigned if functional quadriplegia is specifically documented by a physician in the medical record, and the diagnosis of functional quadriplegia is not associated with a neurologic deficit or injury. A physician may document the diagnosis of functional quadriplegia as occurring with a variety of conditions.”

CMS received a request to reassign cases identified by diagnosis code R53.2 from MS-DRGs 052 and 053 (Spinal Disorders and injuries with and without CC/MCC, respectively). One commenter noted the ICD-10-CM code for functional quadriplegia is located in Chapter 18, Symptoms, Signs and Abnormal findings because it can be the result of a variety of underlying conditions and it is not appropriate to classify this diagnosis as a nervous system disorder.  Clinical advisors agreed and CMS has finalized the assignment of code R532 (functional quadriplegia) to MS-DRGs 947 and 948 (Signs and Symptoms with MCC and without MCC, respectively).

Responsive Neurostimulator (RNS©) System

The RNS© Neurostimulator is a cranially implanted neurostimulator that is a treatment option for persons diagnosed with medically intractable epilepsy. Currently these cases are assigned to MS-DRG 023 (Craniotomy with Major Device Implant or Acute Complex Central Nervous System (CNS) Principal Diagnosis (PDX) with MCC or Chemo Implant) and MS-DRG 024 (Craniotomy with Major Devise Implant or Acute Complex CNS PDx without MCC).

For FY 2018, CMS is reassigning all cases with a principal diagnosis of epilepsy… and one of the following ICD-10-PCS code combinations capturing cases with the neurostimulator generators inserted into the skull (including cases involving the use of the RNS© neurostimulator), to MS-DRG 023, even if there is no MCC reported:

• 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H00MZ (Insertion of neurostimulator lead into brain, open approach);
• 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H03MZ (Insertion of neurostimulator lead into brain, percutaneous approach); and
• 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H04MZ (Insertion of neurostimulator lead into brain, percutaneous endoscopic approach).

A complete list of epilepsy codes assigned to MS-DRG 023 can be found on page 38016 of the Final Rule.

The title for MS-DRG 023 is changing to “Craniotomy with Major Device Implant or Acute Complex Central Nervous System (CNS) Principal Diagnosis (PDX) with MCC or Chemotherapy Implant or Epilepsy with Neurostimulator” to reflect the modifications to MS-DRG assignments.

Precerebral Occlusion or Transient Ischemic Attack with Thrombolytic

“At the onset of stroke symptoms, tPA must be given within 3 hours (or up to 4.5 hours for certain eligible patients) in an attempt to dissolve a clot and improve blood flow to the specific area affected in the brain. If, upon receiving the tPA, the stroke symptoms completely resolve within 24 hours and imaging studies (if performed) are negative, the patient has suffered what is clinically defined as a transient ischemic attack, not a stroke.”

For FY 2018, ICD-10-CM diagnosis codes assigned to MS-DRGs 067, 068, and 069 will be added to the GROUPER logic for MS-DRGs 061, 062 and 063 when sequenced as principal diagnosis and reported with an ICD-10-PCS code describing use of a thrombolytic agent (for example, tPA). The title of MS-DRGs 061, 062 and 063 are changing to “Ischemic Stroke, Precerebral Occlusion or Transient Ischemia with Thrombolytic Agent with MCC, with CC and without CC/MCC” respectively, and the title of MS-DRG 069 is changing to “Transient Ischemia without Thrombolytic.”

MDC 2: Diseases and Disorders of the Eye

Swallowing Eye Drops (Tetrahydrozoline)

CMS finalized moving the following four diagnosis codes describing swallowing eye drops:

• 5X1A (Poisoning by ophthalmological drugs and preparations, accidental (unintentional), initial encounter);
• 5X2A (Poisoning by ophthalmological drugs and preparations, intentional self-harm, initial encounter);
• 5X3A (Poisoning by ophthalmological drugs and preparations, assault, initial encounter); and
• 5X4A (Poisoning by ophthalmological drugs and preparations, undetermined, initial encounter).

These codes will move from MS-DRGs 124 and 125 (Other Disorders of the Eye with and without MCC, respectively) to MS- DRGs 917 and 918 (Poisoning and Toxic Effects of Drugs with and without MCC, respectively).

MDC 5: Diseases and Disorders of the Circulatory System

Percutaneous Cardiovascular Procedures and Insertion of a Radioactive Element

Currently the following six procedure codes are included in MS-DRG 246 (Percutaneous Cardiovascular Procedures with Drug-Eluting Stent with MCC or 4+ Vessels or Stents), MS-DRG 247 (Percutaneous Cardiovascular Procedures with Drug-Eluting Stent without MCC), MS-DRG 248 (Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent with MCC or 4= Vessels or Stents), and MS-DRG and 249 (Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent without MCC):  

• WHC01Z: Insertion of radioactive element into mediastinum, open approach
• 0WHC31Z: Insertion of radioactive element into mediastinum, percutaneous approach
• 0WHC41Z: Insertion of radioactive element into mediastinum, percutaneous endoscopic approach
• 0WHD01Z: Insertion of radioactive element into pericardial cavity, open approach
• 0WHD31Z: Insertion of radioactive element into pericardial cavity, percutaneous approach
• 0WHD41Z: Insertion of radioactive element into pericardial cavity, percutaneous endoscopic approach

When any of the above procedure codes are reported without a percutaneous cardiovascular procedure code, they are assigned to MS-DRG 264 (Other Circulatory System O.R. Procedures).

“Unlike procedures involving the insertion of stents, none of the procedures described by the procedure codes listed above are performed in conjunction with a percutaneous cardiovascular procedure, and two of the six procedures described by these procedure codes (ICD-10-PCS codes 0WHC01Z and 0WHD01Z) are not performed using a percutaneous approach, but rather describe an open approach to performing the specific procedure…Furthermore, the indications for the insertion of a radioactive element typically involve a diagnosis of cancer, whereas the indications for the insertion of a coronary artery stent typically involve a diagnosis of coronary artery disease.” For FY 2018, these six “insertion of radioactive element” codes will maintain their current assignment to MS-DRG 264 and be removed from MS-DRGs 246 through 249.  

MS-DRG Title Change for MS-DRGs 246 and 248

CMS finalized changing the title for MS-DRG 246 and 247 to better reflect the ICD-10-PCS terminology of “arteries” versus “vessels.” The two new MS-DRG titles will be:

• MS-DRG 246: Percutaneous Cardiovascular Procedures with Drug-Eluting Stent with MCC or 4+ Arteries or Stents
• MS-DRG 248: Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent with MCC or 4+ Arteries or Stents
  

Percutaneous Mitral Valve Replacement Procedures

“MS-DRGs 266 and 267 were created to uniquely classify the subset of high-risk cases representing patients who undergo a cardiac valve replacement procedure performed by a percutaneous (endovascular) approach.” 

Currently GROUPER logic for aortic and pulmonary valves are included in MS-DRGs 266 and 266. However, for the mitral valve, the GROUPER logic includes the procedures in the transapical, percutaneous approach.

CMS agreed with a requestor that all cardiac valve replacement procedures should be grouped within the same MS-DRG and finalized the reassignment of the following four mitral valve replacement procedures from MS-DRGs 216 through 221 (Cardiac Valve and Other Major Cardiothoracic Procedures with and without Cardiac Catheterization with MCC, with CC and without CC/MCC respectively) to MS-DRGs 266 and 267 (Endovascular Cardiac Valve Replacement with MCC and without MCC, respectively)

• 02RG37Z: Replacement of mitral valve with autologous tissue substitute, percutaneous approach
• 02RG38Z: Replacement of mitral valve with zooplastic tissue, percutaneous approach
• 02RG3JZ: Replacement of mitral valve with synthetic substitute, percutaneous approach
• 02RG3KZ: Replacement of mitral valve with nonautologous tissue substitute, percutaneous approach
  

Additionally, CMS finalized the assignment of the following eight new procedures codes, effective October 1, 2017, describing percutaneous and transapical, percutaneous tricuspid valve replacement procedures to MS-DRGs 266 and 267:  

• 02RJ37H: Replacement of tricuspid valve with autologous tissue substitute, transapical, percutaneous approach.
• 02RJ37Z: Replacement of tricuspid valve with autologous tissue substitute, percutaneous approach.
• 02RJ38H: Replacement of tricuspid valve with zooplastic tissue, transapical, percutaneous approach.
• 02RJ38Z: Replacement of tricuspid valve with zooplastic tissue, percutaneous approach.
• 02RJ3JH: Replacement of tricuspid valve with synthetic substitute, transapical, percutaneous approach.
• 02RJ3JZ: Replacement of tricuspid valve with synthetic substitute, percutaneous approach.
• 02RJ3KH: Replacement of tricuspid valve with nonautologous tissue substitute, transapical, percutaneous approach.
• 02RJ3KZ: Replacement of tricuspid valve with nonautologous tissue substitute, percutaneous approach.

MDC 8: Diseases and Disorders of the Musculoskeletal System and Connective Tissue

Total Ankle Replacement (TAR) Procedures

TAR procedures are currently assigned to MS-DRGs 469 and 470 (Major Joint Replacement or Reattachment of Lower Extremity with MCC and without MCC, respectively).  

CMS finalized that all TAR procedures be reassigned from MS-DRG 470 to MS-DRG 469, even when there is no MCC reported noting “the claims data support the fact that these cases require more resources than other cases assigned to MS-DRG 470.”

Specific codes proposed for reassignment to MS-DRG 469 include the following:

• 0SRF0J9 (Replacement of right ankle joint with synthetic substitute, cemented, open approach);
• 0SRF0JA (Replacement of right ankle joint with synthetic substitute, uncemented, open approach);
• 0SRF0JZ (Replacement of right ankle joint with synthetic substitute, open approach);
• 0SRG0J9 (Replacement of left ankle joint with synthetic substitute, cemented, open approach);
• 0SRG0JA (Replacement of left ankle joint with synthetic substitute, uncemented, open approach); and
• 0SRG0JZ (Replacement of left ankle joint with synthetic substitute, open approach) for FY 2018.

Additionally, CMS finalized the following title changes for MS-DRG 469 and 470:

• MS-DRG 469: Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity with MCC or Total Ankle Replacement; and
• MS-DRG 470: Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity without MCC.

Revision of Total Ankle Replacement

CMS noted in the Proposed Rule that they had received two requests to modify the MS-DRG assignment for revision of Total Ankle Replacement (TAR) procedures, indicating these procedures are assigned to MS-DRGs 515, 516, and 517 (Other Musculoskeletal System and Connective Tissue O.R. Procedures with MCC, with CC, and without CC/MCC respectively).

CMS Response Key Takeaways

• CMS conducted an analysis of the correct coding revision and agreed with commenters that these cases are not captured with ICD-10-PCS codes with the root operation “Revision” as stated in the Proposed Rule. Instead, the revision of TAR cases are correctly coded using a combination of codes with the root operation “Removal and Replacement” as commenters suggested.
• CMS has asked the American Hospital Association to provide additional information on how to capture revision of TARs in a future issue of Coding Clinic for ICD-10.
• CMS noted that an error in replication for the ICD-10 MS-DRGs resulted in the revision of TAR procedures being assigned to MS-DRGs 469 and 470. This error was not noticed until commenters on the FY 2018 proposed rule pointed out that accurate coding of TARs would result in cases not being assigned to MS-DRGs 515, 516, and 517.
• Since the implementation of ICD-10 MS-DRGs, revision TAR procedures have not been assigned to MS-DRGs 515,516, and 517. Therefore, there is no need to modify MS-DRG logic to reassign the procedures because correctly coded cases are assigned to MS-DRGs 469 and 470.
• CMS noted that by finalizing that all TAR procedure codes be assigned to MS-DRG 469, even if there is no MCC present, for FY 2018 this will result in all revision of TAR procedures being assigned to MS-DRG 469.

Combined Anterior/Posterior Spinal Fusion

It was brought to the attention of CMS “that 7 of the 10 new ICD-10-PCS procedure codes describing fusion using a nanotextured surface interbody fusion device were not added to the appropriate GROUPER logic list for MS-DRGs 453, 454, and 455 (Combined Anterior/Posterior Spinal Fusion with MCC, with CC and without CC/MCC, respectively), effective October 1, 2016. The logic for MS-DRGs 453, 454, and 455 is comprised of two lists: an anterior spinal fusion list and a posterior spinal fusion list. Assignment to one of the combined spinal fusion MS-DRGs requires that a code from each list be reported.”

After reviewing spinal fusion codes using a nanotextured surface interbody fusion device CMS finalized the following:

• Moving 7 codes describing spinal fusion using a nanotextured surface interbody fusion device from the posterior spinal fusion list to the anterior spinal fusion list in the GROUPER logic for MS-DRGS 453, 454, and 455.
• Moving 149 procedures codes describing spinal fusion of the anterior column with a posterior approach from the posterior spinal fusion list to the anterior spinal fusion list in the GROUPER logic for MS-DRGs 453, 454, and 455.
• Deleting 33 procedure codes describing spinal fusion of the posterior column with an interbody fusion device from MS-DRGs 453 through 460 and 471 through 473, as well as from the ICD-10-PCS classification.

Review of Procedures Codes in MS-DRGs 981 through 983, 984 through 986; and 987 through 989

Annually, CMS reviews the following cases to determine if it would be appropriate to change the procedures assigned among these MS-DRGs:

• MS-DRGs 981, 982, and 983: Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively,
• MS-DRGs 984, 985, and 986: Prostatic O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively; and
• MS-DRGs 987, 988, and 989: Nonextensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively.

These MS-DRGs are reserved for when none of the O.R. procedures performed are related to the principal diagnosis. They are “intended to capture atypical cases, that is, those cases not occurring with sufficient frequency to represent a distinct, recognizable clinical group.”

Based on claims data review CMS found it is no longer necessary to maintain a separate set of MS-DRGs specifically for the prostatic O.R. procedures and therefore finalized the following:

• Reassign procedure codes currently assigned to MS-DRGs 984 through 986 to MS-DRGs 987; and
• Delete MS-DRGs 984, 985 and 986 as they would no longer be needed.

In the Final Rule, CMS encourages input from stakeholders concerning annual IPPS updates. In previous years, to be considered for the next annual proposed rule update, CMS has required that input be sent to them by December 7th of the prior year. As CMS undertakes working with ICD-10 data they note this will require additional time and are changing the deadline to request updates to MS-DRGs to November 1 of each year which provides them with 5 additional weeks for the data analysis and review process. For those interested in submitting comments and/or suggestions for FY 2019, they need to be sent by November 1, 2017, via the CMS MS_DRG Classification Change Requests Mailbox located at: MSDRGClassificationChange@cms.hhs.gov.

As stated in the opening of this article, we have shared a few key highlights from this portion of the Final Rule. MMP encourages all key stakeholders to take the time to dive a little deeper into the detail.

In the Acute Care Hospital Inpatient setting, discharges are assigned to one Medicare Severity Diagnosis-Related Group (MS-DRGs) for the entire hospitalization. The MS-DRG System groups together similar clinical conditions and the procedures furnished during a hospitalization.

Principal Diagnoses, MCCs (Major Complications/Comorbidities), CCs (Complications/Comorbidities) and Procedures may all impact MS-DRG assignment. Notice I did not say will impact MS-DRG assignment. This is because there are specific MCCs, CCs and O.R. Procedures designated by CMS that will impact MS-DRG assignment and other secondary diagnoses and Non-O.R. designated procedures that won’t.

With the October 1, 2015 ICD-10-CM/PCS implementation, several new O.R. Procedure Codes impacting MS-DRG assignment had Coding Professionals and CDI Specialists questioning if the resources to perform the procedures truly supported the O.R. Procedure designation. CMS soon realized this too and included proposals in the FY 2017 IPPS Proposed Rule for consideration to re-designate certain ICD-10-PCS procedures codes from O.R. Procedures to Non-O.R. Procedures.

CMS asked and the provider community responded. In fact, CMS received over 800 recommendations and were unable to fully evaluate and finalize recommendations for release in the 2017 IPPS Final Rule.

Fast forward to the April 2017 release of the FY 2018 IPPS Proposed Rule. This year CMS is proposing to re-designate over 800 current O.R. Procedures as Non-O.R. Procedures. Specific code groups being proposed “generally would not require the resources of an operating room and can be performed at the bedside.”

For those interested in reading the detail, this discussion can be found on pages 58 through 69 of the Proposed Rule pdf document. For those that prefer the highlights, keep reading to find the Code Groups being proposed, the volume of codes being proposed for re-designation by Major Diagnostic Category (MDC), and to begin to understand the potential impact if the proposals are finalized.

Code Groups

First let’s take a look at the code groups remembering that what is being proposed are procedures that in general do not require the resources of an O.R. room and can be performed at the bedside. The following table details the number of ICD-10-PCS codes by code group and a description of the code group. 

Potential Impact of ICD-10-PCS Code Re-Designation While I agree with what is being proposed, it immediately made me wonder just how many of these codes have been driving MS-DRG assignment to a Surgical MS-DRG. For answers, as I so often do, I turned to our sister company RealTime Medicare Data (RTMD) to “crunch the numbers.” At the Medicare Administrative Contractor (MAC) level, I analyzed paid claims data for Calendar Year (CY) 2016 for the Jurisdiction J MAC that adjudicates claims for Alabama, Georgia and Tennessee. At this level the numbers “feel significant.” The following table highlights the volume of claims, total charges and actual amount paid to Providers by MDC.  

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Key Takeaway from the Data:

• For Calendar Year 2016, 3,968 claims were paid to Providers in Alabama, Georgia, and Tennessee combined in the amount of $73,718,329.42.
• MDC 4: Diseases and Disorders of the Respiratory System had the highest volume of claims paid at 645.
• MDC 9: Diseases and Disorders of the Skin, Subcutaneous Tissue & Breast came in a close second at 640 claims paid.
• Pre-MDCs, while not the highest volume of claims, resulted in the highest actual claims payment at $13,152,598.75.

MS-DRG Shift from Surgical to Medical

Yes, these 800+ ICD-10-PCS codes resulted in assignment to a surgical MS-DRG for almost 4,000 claims and several million dollars. However, it is important to remember without the ICD-10-PCS code designation, your hospital would still receive reimbursement for the Medical Principal Diagnosis. The Relative Weights of the Surgical MS-DRGs assigned ranged from 0.5865 all the way to 17.95. From this it is reasonable to assume the shift in payment will also vary widely. 

In order to put this into context, I have provided the following examples of the financial impact when there is an MS-DRG shift from a Surgical MS-DRGs to a Medical MS-DRG:

• Patient A
• Dates of Service: 3/29/2016 – 4/19/2016
• Principal Procedure Code: 06H03DZ Insertion of Intraluminal Device into Inferior Vena Cava, Percutaneous Approach
• Principal Medical Diagnosis Code: A4195 Other Gram-negative sepsis
• MS-DRG Assigned 03: ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure
• Relative Weight: 17.657
• CMS FY 2016 National Average Reimbursement $95,944.77.
• Without any additional procedure to drive MS-DRG assignment and without an MCC, in this scenario the MS-DRG would be reassigned to:
• MS-DRG 872: Septicemia or Severe Sepsis without Mechanical Ventilation >96 Hours without MCC
• Relative Weight: 1.0427
• CMS FY 2016 National Average Reimbursement $5,665.86
• Patient B
• Dates of Service: 5/3/2016 – 5/13/2016
• Principal Procedure Code: 30233Y0 Transfusion of Autologous Hematopoietic Stem Cells into Peripheral Vein, Percutaneous Approach
• Principal Medical Diagnosis Code: R112 Nausea with vomiting, unspecified
• MS-DRG Assigned: 016 Autologous Bone Marrow Transplant with CC/MCC
• Relative Weight: 6.1746
• CMS FY 2016 National Average Reimbursement: $33,551.79 
• Without any additional procedures to drive MS-DRG assignment, in this scenario with an MCC, the MS-DRG would be reassigned to:
• MS-DRG 391: Esophagitis, Gastroenteritis & Miscellaneous Digestive Orders with MCC
• Relative Weight: 1.1925
• CMS FY 2016 National Average Reimbursement: $6,479.85
• Patient C
• Dates of Service: 7/18/2016 – 7/23/2017
• Principal Procedure Code: 0HBFXZZ Excision of Right Hand Skin, External Approach
• Principal Medical Diagnosis Code: L03011 Cellulitis of Right Finger
• MS-DRG Assigned: 572 Skin Debridement without CC/MCC
• Relative Weight 1.0391
• CM FY 2016 National Average Reimbursement: $5,646.30
• Without and additional procedures to drive MS-DRG assignment, in this scenario, the MS-DRG would be reassigned to:
• MS-DRG 603: Cellulitis without MCC
• Relative Weight: 0.8429
• CMS FY 2016 National Average Reimbursement: $4,580.18

MMP strongly encourages key stakeholders at your facility take the time to review the proposed rule and submit comments. CMS is accepting comments through 5 p.m. EDT on June 13, 2017.

Resource:

2018 IPPS Proposed Rule published in the Federal Register: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2018-IPPS-Proposed-Rule-Home-Page.html

What was your strong subject in school – reading, writing, or math? To bill drugs correctly to Medicare, you need a little of all three.

Based on the physician’s order, 500 mg of Infliximab is administered to a patient. To bill for the Infliximab, a provider would report HCPCS code J1745 which has a description of “Injection, Infliximab, excludes biosimilar, 10 mg.” These means 50 units of J1745 would be reported on the claim to reflect the 500 mg given to the patient (500 mg dose divided by 10 mg description equals 50 units). If a patient requires a dose of 800 mg, then 80 units of J1745 would be billed for the amount of the drug administered and the provider may bill 20 additional units with a JW modifier if a 200 mg portion of a 250 mg single-use vial had to be wasted. The point here is that the units billed do not equal the dose amount; the units billed are based on the dose given and/or wasted and the HCPCS description of the drug. Units of service are reported in multiples of the units shown in the HCPCS narrative description. Furthermore, the physician’s order, the medication administration record, and applicable nursing or pharmacy notes must appropriately document the dosage ordered, the amount of drug administered, and any drug wastage.

Sounds straight-forward but evidently a lot of providers have problems getting this correct. The Medicare Supplemental Medical Review Contractor (SMRC) has issued notice of a new project to conduct post payment review of claims to identify incorrect units of service for outpatient drugs. According to the SMRC announcement, “Correct payments depend on providers’ accurate reporting of the HCPCS codes and units of service for each line item billed.”

The SMRC review project is at least partially in response to a July 2015 Office of Inspector General (OIG) report that identified $35.8 million in overpayments for selected outpatient drugs from July 2009 through June 2012. Eighty-eight percent of the overpayments identified in this OIG report were due to billing “either incorrect units of service or a combination of incorrect units of service and incorrect HCPCS codes.”

Medicare has established prepayment Medically Unlikely Edits (MUEs) to reduce payment errors. MUEs establish a limit for the units billed for a drug HCPCS code based on the maximum number of units a provider would reasonably administer to a patient for that code on that date of service. The OIG identified outpatient drugs that (1) had units of service that exceeded the MUE values or (2) did not have established MUE values but had units of service that exceeded the number of units a provider would reasonably administer to a beneficiary on a single date of service.

In addition to the SMRC review of outpatient drug units, the new Recovery Auditors for Regions 1, 2, and 3 have posted approved issues that address drug units. Those issues include:

• Automated review of drugs and biologicals whose units exceed the only FDA approved dose,
• Complex review of the drug Trastuzumab (Herceptin), J9355 - multi-dose vial wastage, dose vs. units billed. Documentation will be reviewed to determine if the billed amount of Trastuzumab (Herceptin) meets Medicare coverage criteria and applicable coding guidelines.
• Automated review of the drug Regadenoson (Lexiscan), J2785, billed with units greater than four (4).
• Automated review of the drug Zoledronic Acid billed with units greater than or equal to five (5) to identify excess units of J3489 as either excess units within a single line and/or as excess units across multiple lines/claims for the same beneficiary, the same HCPCS code and the same revenue center date.

A number of Medicare Administrative Contractors (MACs) are conducting medical reviews of drugs. These are generally complex reviews and drug units are only one of the issues considered. Search our knowlegde base for "drug review results" for more on this.

When billing for drugs, providers need to ensure they know the HCPCS code description, divide correctly, have the correct conversion factors in their charge description master (CDM), and have appropriate documentation in their records. A little reading, a little math and a little writing…

“The difference between the almost right word and the right word is really a large matter --- it’s the difference between the lightning bug and lightning.”- Mark Twain: Letter to George Bainton, October 15, 1888

In MMP’s article Case Mix Index: Beyond the Physician's Pen, our readers were introduced to the concepts of Medicare Severity Diagnosis-Related Groups (MS-DRGs), how an MS-DRG is assigned, Principal and Secondary diagnoses, Relative Weight (RW), and Case Mix Index (CMI). CMS defines CMI as a representation of the average diagnosis-related group (DRG) relative weight for that hospital. It is calculated by summing the DRG weights for all Medicare discharges and dividing by the number of discharges. CMIs are calculated using both transfer-adjusted cases and unadjusted cases.

We also likened the way a CMI is calculated to calculating a student’s Grade Point Average (GPA).

Formula for CMI: Sum of RWs ÷ Total Number of MS-DRGs = CMI
Formula for GPA: Sum of Grade Points ÷ Sum of Credit Hours = GPA

A higher CMI reflects a more complex patient population that required higher resource utilization. A higher GPA reflects a higher level of academic achievement by the student which required a higher focus on academic studies resulting in the student having a more complex understanding of the subject matter.

CMI Pain Points for Hospitals

This article focuses on CMI pain points for hospitals including understanding that a successful MS-DRG Program is a collaborative process, there are several reasons that a CMI can fluctuate, and that slight shifts in CMI can have a significant impact on your hospital finances.

Pain Point: Understanding that a successful MS-DRG Program is a Collaborative Process

For a hospital to be successful in obtaining the CMI that truly reflects their patient population is a collaborative effort between the Physician, Clinical Documentation Improvement Specialists and Professional Coders. Here are the specific roles each team member must fill to truly tell the patient’s story.

• The Physician’s Role: Tell the Patient’s Story by providing complete and accurate documentation of a patient’s Principal Diagnosis, comorbidities and complications, any procedures performed, the plan of care and the patient’s discharge status in the medical record.

• The Clinical Documentation Specialist’s Role: Interpret the documentation by performing concurrent medical record reviews and ask for clarity and/or accuracy of the clinical picture.  

• The Coder’s Role: May be concurrent medical record review or a retrospective review after discharge; also to ask queries when indicated. Ultimately, it is the Coding Professional’s role to translate documentation into codes for MS-DRG assignment.

Before moving on to the next Pain Point, it is important to note that CMS supports this collaborative process. In fact in the 2008 IPPS Final Rule CMS noted that they do “not believe there is anything inappropriate, unethical or otherwise wrong with hospitals taking full advantage of coding opportunities to maximize Medicare payment that is supported by documentation in the medical record. We encourage hospitals to engage in complete and accurate coding.”

AHIMA’s 2016 Practice Brief, Guidelines for Achieving a Compliant Query Practice, also supports the query process. Specifically, they note that a Physician Query is “a communication tool used to clarify documentation in the health record for accurate code assignment. The desired outcome from a query is an update of a health record to better reflect a practitioner’s intent and clinical though processes, documented in a manner that supports accurate code assignment.”

Pain Point: Recognizing Factors Leading to CMI Fluctuations

As a Clinical Documentation Specialist in the hospital, I can remember monthly operational review meetings where inevitably the Chief Financial Officer (CFO) wanted an explanation for the shift (positive or negative) in CMI and placed this responsibility solely on the Clinical Documentation Improvement Team. Quite a few years have passed since then and I am hopeful that this is no longer the case at your hospital. However, if it is, share this article with your CFO to help him/her understand that shifts in CMI can happen that are beyond a Coder or Clinical Documentation Specialists control.

A decrease in CMI may be reflective of:

• Non-specific Physician documentation,
• Increase in Medical Volume with a decrease in Surgical Volume as Surgical MS-DRGs in general are more resource intensive and will have a higher RW,
• Surgeons being on vacation;
• Inpatient admissions that could have been treated as an Outpatient, or
• Physicians being unresponsive to Coder and Clinical Documentation Specialists queries.
• Note, queries are asked to clarify documentation, not to question a physician’s clinical judgment.

An increase in CMI may be reflective of:

• Increase in surgical volume,
• Tracheostomy procedures that have an extremely high RW,
• Ventilator patients, or
• Improved physician response to queries resulting in improved documentation depicting the patient’s story.

Pain Point: Recognizing that Small Variances in CMI can Significantly Impact a Hospitals Finances

CMI shifts of even 0.1000 can have a significant impact on your hospital finances. To illustrate, the following table takes a look at the “We Care for You Hospital” which saw a decrease in their CMI of 0.1000 from FY 2015 to FY 2016.

The above example is just that, an example. In reality, surgeons go on vacation, surgical and medical volumes change, MS-DRGs are reassigned a new RW on an annual basis that may be higher or lower than the prior fiscal year, improved physician documentation can have a positive impact on your secondary diagnoses capture rate, and ICD-10 happened.

To validate there is more to CMI than meets the eye, I turned to our sister company RealTime Medicare Data (RTMD) to analyze Medicare Fee-for-service paid claims data. Specifically, I compared the Fiscal Year prior to ICD-10 implementation to the first full Fiscal Year after the October 1, 2015 ICD-10 implementation date. The following two tables contrasts the Top 10 MS-DRGs by RW, CMI, number of discharges and actual payment for the state of Alabama.

At the end of the day, accurate documentation captures the clinical severity of the patient that in turn can:

• Increase patient safety,
• Increase the accuracy of Quality measures,
• Decrease the risk of medical necessity denials,
• Result in more accurate Readmission and Mortality rates for your hospital,
• Impact physician and hospital profiles; and
• Support that your patients have received the right care, at the right time, at the right cost and in the right setting.

 

Resource:

Federal Register / Vol. 72, No. 162 / Wednesday, August 22, 2007 / Rules and Regulations / page 47180 at https://www.gpo.gov/fdsys/pkg/FR-2007-08-22/pdf/07-3820.pdf

Medicare requires that practitioners ordering or providing services authenticate their orders and other documentation notes. A simple enough concept, but sometimes it is the simple things that seem to trip us up. Medicare reviews often cite lack of physicians’ signatures on orders, procedure notes, diagnostic reports or progress notes as a documentation deficiency that could result in a denial of payment. A review of Medicare signature requirements is an excellent reminder of the basics of good documentation.

What forms of signatures are acceptable?

Signatures may be handwritten or electronic. Stamped signatures generally are not acceptable, but are permitted in the case of an author with a physical disability who can provide proof to a CMS contractor of inability to sign due to the disability.

Can signatures be added to documentation that is not signed?

No. Providers may not add late signatures to medical records beyond the short delay that occurs during the transcription process.

Medicare does not accept retroactive orders. If an order is unsigned and there are no signed progress notes that specify the tests/services being ordered, a Medicare reviewer will disregard the order. This will result in a documentation error, which may involve recoupment of an overpayment.

For other types of medical record documentation that lack a signature besides orders, an attestation statement from the author of the medical record may be submitted. An attestation may read as follows, though no specific format is required:

            “I, John R. Doe (printed name), hereby attest that the medical record entry for March 9, 2016 accurately reflects signatures/notations that I made in my capacity as M.D. when I treated/diagnosed the above listed Medicare beneficiary. I do hereby attest that this information is true, accurate and complete to the best of my knowledge and I understand that any falsification, omission, or concealment of material fact may subject me to administrative, civil, or criminal liability.”

Must orders for clinical diagnostic tests be signed?

No - but yes. The order for a clinical diagnostic test does not have to be signed. However, if the order itself is not signed, there must be medical documentation by the treating physician (e.g., a progress note) that he/she intended the clinical diagnostic test be performed. The documentation showing the intent that the test be performed must be authenticated by the author via a handwritten or electronic signature. It also must specify the tests ordered; simply saying “labs ordered” is not sufficient. And, a copy of this signed documentation must be submitted to the Medicare contractor in the case of a Medicare review.

What if a signature is illegible?

If there is a printed signature below the illegible signature, this is acceptable. Providers can also submit a signature log to address illegible signatures. A signature log should list the typed or printed name of the author associated with the author’s handwritten initials or signature. Note that providers may create and submit a signature log at any time. It is a good practice to maintain a signature log of all practitioners.

Another way to address illegible signatures is an attestation statement. The attestation must be signed and dated by the author of the medical record entry in order to be valid for Medicare medical review purposes. It also must contain sufficient information to identify the Medicare patient/beneficiary.

Must signatures be dated?

It depends. If Medicare regulations specify that a date is required for the particular type of documentation then it must be dated. For example, for rehabilitative therapy services, the Medicare Benefit Policy manual states, “Certification requires a dated signature on the plan of care or some other document that indicates approval of the plan of care.” Therefore, for therapy certifications, a dated signature is required.

If the Medicare regulations do not specify that a date is required, undated documentation may be acceptable. Documentation that is not dated is acceptable for medical review purposes if the reviewer is able to determine the date the service was performed and/or ordered based on other documentation in the record.

Since the issue of missing and illegible signatures continues to be a common error, Medicare provides a variety of resources addressing the requirements. Providers must get back to the basics of documentation by ensuring appropriate signatures are present.

• Medicare Signature Requirements – Educational Resources for Health Care Professionals: SE1419
• Medicare Signature Requirements Fact Sheet: Fact Sheet
• Chapter 3, Section 3.3.2.4, Medicare Program Integrity Manual
• Signature Guidelines for Medical Review Purposes: MM6698 

Hospitals are at T-7 days for the March 8, 2017 compliance date with the Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE Act). In the spirit of last minute preparations, this article is meant to reinforce key definitions, provide CMS responses to comments found in the 2017 IPPS Final Rule in the form of questions and answers and links to MOON resources.

 

Definitions

The MOON is intended to inform beneficiaries who receive observation services for more than 24 hours that they are outpatients receiving observation services and not inpatients, and the reasons for such status.

• Outpatient Defined
  The Medicare Claims Processing Manual (Pub. 100-04), Chapter 1, Section 50.3.1, defines an Outpatient as “a person who has not been admitted as an inpatient but who is registered on the hospital or critical access hospital (CAH) records as an outpatient and receives services (rather than supplies alone) directly from the hospital or CAH.”

• Observation Services
  Observation services are “services that are reasonable and necessary, specifically ordered by a physician or other nonphysician practitioner authorized by State licensure law and hospital staff bylaws to admit patients to the hospital or to order outpatient services, and meet other published Medicare criteria for payment.”
  
  “Individuals receiving observation services will always be registered as outpatients; however, not all outpatients receive observation services.”

• Decision to order Observation Services
  “By definition… the reason for ordering observation services will always be the result of a physician’s decision that the individual does not currently require inpatient services and observation services are needed for the physician to make a decision regarding whether the individual needs further treatment as a hospital inpatient or if the individual is able to be discharged from the hospital.” (Source: 2017 IPPS Final Rule referencing the Medicare Benefits Policy Manual (Pub. 100-02), Chapter 6, Section 20.6.)

Questions and Answers

Again, CMS’ responses to comments from the 2017 IPPS Final Rule have been formatted as Questions and Answers.

Question: Several commenters requested clarification as to whether the timeframe starts:

1. After services begin following the written order for observation services;
2. When related services commence if such services commence before the written order was executed and the patient occupies an outpatient bed count; or
3. Based on the documentation of when nursing care began.

Answer: CMS indicated “there may be times when an individual is subject to an order for observation services, but is not actually receiving observation services. For example, following an order for observation services in an emergency department, a hospital may need to wait to begin furnishing observation services until a bed is available for the patient. In this situation, services are considered initiated when observation services commence.”

They went on to clarify “that the start of observation services, for the purposes of determining when more than 24 hours of observation services have been received, is the clock time as documented in the patient’s medical record at which observation services are initiated (furnished to the patient) in accordance with a physician’s order.”

Question: Will time be counted as Billable or Elapsed Time?

Answer: CMS believes using elapsed time is most consistent with language in the NOTICE Act. “Therefore, for purposes of identifying the 24-hour timeframe for which an individual has received observation services, and thus is required by the NOTICE Act to receive notice by the hospital or CAH, observation time will be measured as the elapsed time in hours beginning at the clock time documented in the patient’s medical record, which coincides with the time that observation care is initiated in accordance with a physician’s order.”

Question: What if the Inpatient Admission occurs prior to delivery of the MOON?

Answer: As recommended by a commenter, CMS agrees that when “an inpatient admission occurs prior to delivery of the MOON, the MOON should be annotated with date and time of the inpatient admission. Therefore, we are requiring that, in the event that a patient is subsequently admitted as a hospital inpatient directly after receiving observation services for more than 24 hours, and the inpatient admission occurs prior to delivery of the MOON, the MOON be annotated with the date and time of the inpatient admission. Additional guidance regarding elements for the free text field of the MOON will be provided in the CMS Internet Only Manual.”

Question: How will the MOON work with the 2-Midnight Policy?

Answer: “The NOTICE Act requires hospitals to inform patients who have remained outpatients of the hospital and received observation services for more than 24 hours that they are not hospital inpatients and are subject to potentially different cost-sharing requirements and postacute care benefits than someone who has been admitted as an inpatient. We note that a scenario could arise whereby a patient is admitted to the hospital immediately after being a hospital outpatient receiving observation services for greater than 24 hours. In such a scenario, the inpatient admission may be payable under Medicare Part A under the 2-midnight policy and, as stated earlier, the hospital or CAH would still be required to furnish the MOON to the patient within 36 hours after the time the individual begins receiving observation services.”

Question: Can a Hospital or CAH deliver the MOON before an individual has received more than 24 hours of observation services as an inpatient?

Answer: Yes.

• This affords hospitals flexibility to deliver the MOON consistent with any applicable state law requiring notice within 24hrs.
  
  Note: “Hospitals and CAHs subject to State law notice requirements may also attach an additional page to the MOON to supplement the “Additional Information” section in order to communicate additional content required under State law, or may attach the notice required under State law to the MOON.”

• This allows hospitals and CAHs to spread out the delivery of the MOON and other hospital paperwork in an effort to avoid overwhelming and confusing beneficiaries.
  
  Note: CMS does not encourage delivery of the MOON at the initiation of outpatient observation services.

Question: Can the MOON form be altered?

Answer: No, because the MOON is a standard form approved by the Office of Management and Budget (OMB), Hospitals and CAHs are not permitted to alter the included language, only the information to be included in the free text fields.

The MOON must remain two pages, except as needed for the additional information field. The pages of the notice can be two sides of one page or one side of separate pages, but must not be condensed to one page.

Hospitals may include their business log and contact information on the top of the MOON. Text may not be shifted from page 1 to page 2 to accommodate large logos, address headers, or any other information.

Question: Can you use “drop down” boxes in the free text field for telling the patient why they are not an inpatient?

Answer: CMS indicates in the 2017 IPPS Final Rule, “We may consider, in the future, the other suggestions commenters made to improve the MOON, such as checkboxes with common reasons for the patient’s outpatient status or suggested narratives for insertion in this section.”

Question: If more space is needed for “Additional Information”, may a Hospital attach additional pages to the MOON?

Answer: Yes

Question: Can you (CMS) clarify the effect of a resident’s order for services on the counting of hours of observation care?

Answer: “To the extent that a resident is authorized by State licensure law and hospital staff bylaws to order outpatient services, once observation services are initiated in accordance with the resident’s order, the 24 hour time period will commence.”

Question: What do you do if the individual receiving the notice is unable to read its written contents and/or comprehend the required oral explanation?

Answer: As discussed in the proposed rule (81 FR 25134), an English language version of the proposed MOON was submitted to OMB for approval. We stated in the proposed rule that once we receive OMB approval, a Spanish language version of the MOON will be made available. If the individual receiving the notice is unable to read its written contents and/or comprehend the required oral explanation, we expect hospitals and CAHs to employ their usual procedures to ensure notice comprehension. (We refer readers, for example, to the Medicare Claims Processing Manual (Pub. 100–4), Chapter 30, Section 40.3.4.3., for similar existing procedures related to notice comprehension for the Advance Beneficiary Notice of Noncoverage (ABN).) Usual procedures may include, but are not limited to, the use of translators, interpreters, and assistive technologies. Hospitals and CAHs are reminded that recipients of Federal financial assistance have an independent obligation to provide language assistance services to individuals with limited English proficiency (LEP) consistent with section 1557 of the Affordable Care Act and Title VI of the Civil Rights Act of 1964. In addition, recipients of Federal financial assistance have an independent obligation to provide auxiliary aids and services to individuals with disabilities free of charge, consistent with section 1557 of the Affordable Care Act and section 504 of the Rehabilitation Act of 1973.”

Question: Does the beneficiary have appeal rights under the NOTICE Act?

Answer: No, “The MOON is a required informational/educational notice regarding patient status provided by a hospital or CAH when the beneficiary is still in the hospital or CAH and receives observation services as an outpatient for more than 24 hours. The MOON explains the current status of the patient as an outpatient and not an inpatient, in addition to the implications of being an outpatient receiving observation services. As we explained in the proposed rule, delivery of the MOON does not constitute an initial determination issued in response to a claim for benefits, and the MOON itself is not a notice of an initial determination (81 FR 25134). Furthermore, delivery of the MOON by a hospital or CAH does not constitute a denial of coverage of any services, and does not constitute a noncoverage decision with respect to post-hospital SNF care as asserted by the commenter. In fact, generally beneficiaries will still be receiving care when the MOON is delivered and will sometimes be formally admitted as inpatients after delivery of the MOON.

The NOTICE Act does not provide for appeal rights regarding the notice itself, which makes sense given the nature of the document, as explained above. The NOTICE Act also does not afford any new appeal rights beyond those already available (under section 1869 of the Social Security Act), nor does the NOTICE Act limit or restrict currently available appeal rights. Consistent with the legislation, the proposed rule did not propose to expand or limit appeal rights. For the reasons discussed above, we are not adopting the various recommendations with respect to amending the MOON to include appeal rights or an explanation of the lack of appeal rights.”

 

MOON and Condition Code 44

“In rare circumstances where a physician initially orders inpatient services, but following internal utilization review (UR) performed while the patient is hospitalized, the hospital determines that the services do not meet its inpatient criteria and the physician concurs with UR and orders the discontinuation of inpatient services and initiation of outpatient observation services (that is, a Condition Code 44 situation), we stated in the proposed rule that the MOON would be delivered as required by the NOTICE Act (when outpatient observation services have been ordered and furnished for more than 24 hours). If observation services are ordered when Condition Code 44 applies, the 24-hour time period for observation notification commences at the same time that observation services are initiated under a physician’s order, consistent with existing policy for observation services furnished to outpatients. (We refer readers to the Medicare Claims Processing Manual (Pub. 100–04), Chapter 1, Section 50.3.)

As discussed in the proposed rule and as stated in the notice announcing CMS Ruling CMS–1455–R (78 FR 16614), the Part B Inpatient Billing Ruling, in cases where reviewers find that an inpatient admission was not medically reasonable and necessary after the beneficiary is discharged, and thus, not appropriate for payment under Medicare Part A, the beneficiary’s patient status remains ‘‘inpatient’’ as of the time of the inpatient admission. The patient’s status is not changed to outpatient because the beneficiary was formally admitted as an inpatient, and there is no provision to change a beneficiary’s status after he or she is discharged from the hospital. Where CMS denies a claim after the beneficiary has been discharged because the inpatient admission was not medically reasonable and necessary, there would be no need to issue the MOON because the individual’s status remains inpatient, despite the fact that the inpatient admission was improper. Similarly, where a hospital determines through UR after a beneficiary is discharged that his or her inpatient admission was not reasonable and necessary and the hospital bills the services that were provided on a Medicare Part B claim, the NOTICE Act notification requirements would not apply for these individuals because their status would also remain inpatient.” (Excerpt from page 281-282 2017 IPPS Final Rule pdf document)

 

MOON Resources

• CMS 2017 IPPS Final Rule web page: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2017-IPPS-Final-Rule-Home-Page.html
• See section III. L. Hospital and CAH Notification Procedures for Outpatients Receiving Observation Services (pages 277 – 292 Final Rule pdf document)

• CMS Transmittal 3695, Date: January 20, 2017
  Subject: medicate Outpatient Observation Notice (MOON) Instructions: https://www.cms.gov/Medicare/Medicare-General-Information/BNI/Downloads/CR9935-MOON-Instructions.pdf

• CMS MLN Matters® Number: MM9935: Medicare Outpatient Observation Notice (MOON) Instructions: https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM9935.pdf

• CMS Beneficiary Notices Initiative web page: https://www.cms.gov/Medicare/Medicare-General-Information/BNI/index.html?redirect=/BNI/

• CMS Product No. 11435: Are You a Hospital Inpatient or Outpatient? If You Have Medicare – Ask! at: https://www.medicare.gov/Pubs/pdf/11435.pdf

My grandson is in elementary school and the first thing he reports to his parents each afternoon is how he behaved in school. His teacher uses a color scale, on which the student moves up or down depending on good or bad behavior – green is good, blue is better, but red – oh no! The one excuse I am sure his parents would never accept for bad behavior is that he did not know the rules. From an early age, life has rules and it is our responsibility to know, understand, and follow those rules. Such is the case when submitting claims and accepting payment from Medicare for healthcare services.

In November 2016, CMS released a transmittal that updates the section on Provider Liability in Chapter 3 of the Medicare Financial Management Manual. Specifically, the update adds new reasons for why a provider, physician, or supplier should have known certain services were noncovered. Section 90 of this chapter begins by stating “A provider is liable for overpayments it received unless it is found to be without fault.” To be without fault, the provider must have:

• Exercised reasonable care in billing for, and accepting Medicare payment,
• Made full disclosure of all material facts,
• Had a reasonable basis for assuming payment was correct based on Medicare instructions, regulations, and other facts, and/or
• Promptly communicated with the Medicare contractor if there was a reason to question the payment.

A provider may know or should have known a payment is incorrect if there is a Medicare policy or rule that specifically prohibits the payment. Prior to this updated transmittal, the reasons listed in the manual when a provider should have known about a policy or rule were 1) the policy or rule is in the provider manual or in Federal regulations, 2) the Medicare contractor provided general notice to the medical community concerning the policy or rule, or 3) the Medicare contractor gave written notice of the policy or rule to the particular provider. Transmittal 275 (MLN Matters Article MM9708) expands the term provider to be “provider, physician, or supplier” and adds the following reasons they should be aware of a particular Medicare policy or rule.

The provider, physician, or supplier:

1. Was previously investigated or audited as a result of not following the policy or rule;
2. Previously agreed to a Corporate Integrity Agreement as a result of not following the policy or rule;
3. Was previously informed that its claims had been reviewed/denied as a result of the claims not meeting certain Medicare requirements which are related to the policy or rule; or
4. Previously received documented training/outreach from CMS or one of its contractors related to the same policy or rule.

As a provider, what is your responsibility related to overpayments and ensuring reasonable care in billing and accepting Medicare payment?

Know the Rules

If the rules were static, this would still be a huge challenge. There are laws, regulations (e.g. Code of Federal Regulations), and sub-regulatory guidance (e.g. Medicare policy manuals). Medicare has an expansive website with information in every corner, including an educational section (Medicare Learning Network – MLN). I recommend providers subscribe to the CMS and OIG (Office of Inspector General) list serves at a minimum. Also providers should have a thorough knowledge of the Medicare Benefit Policy, Claims Processing, and National Coverage Determination (NCD) manuals. Then there is the website of your Medicare Administrative Contractor (MAC) and their Local Coverage Determinations (LCDs) and coverage articles. It is an overwhelming amount of information to digest so I also recommend subscribing to newsletters from some reputable healthcare consultants/educators who can target key issues and provide relevant information in an easy to read, understandable format. Hopefully you find this Wednesday@One newsletter serves this function well.

Keep Up with Rule Changes

Unfortunately, the rules are not static – they are ever changing at a rapid pace. The list serves, websites, and newsletters mentioned above should address the changes also. More specifically, watch the Medicare transmittals, most of which are converted into the easier to read and understand format of MLN Matters articles. The transmittals provide updates of Medicare sub-regulatory guidance. All the MACs have a news section on their websites for updates and specific webpages related to coverage policies and medical review. There are major rule changes on an annual basis for the Inpatient Prospective Payment System (IPPS), Outpatient Prospective Payment System (OPPS), Physician Fee Schedule, etc. Medicare provides fact sheets related to these rules and numerous independent newsletters also offer summaries and in-depth analyses of the key issues.

Understand the Rules

Interpreting the rules correctly is no small task. Once again all of the references mentioned above are helpful but a focus on Medicare review activities to understand Medicare expectations is extremely helpful here. The medical review webpage areas of the MAC websites, OIG reports, the Medicare Quarterly Compliance Newsletter, etc. often provide more granular details on what is expected to comply with certain rules. These issues are also the more “at risk” issues and a good place to focus your internal efforts as well.

Know Your Facility History of Billing Compliance

Notice that the third existing reason why providers “should have known” and all four of the new reasons relate to the provider’s own history of compliance. Facilities need to know if they have been notified, investigated, audited, had claims denied, or educated due to noncompliance with a particular policy or rule. This also includes having been put under a Corporate Integrity Agreement (CIA). If so, your facility has no excuse for not knowing these rules.

Have Appropriate Processes

Knowing the rules is of no benefit unless you correctly apply the rules to your facility’s practices. I will not say much about this, because after all, this is what providers do, so you know how to address it. Internal policies and procedures to ensure appropriate processes are necessary as is employee education and training.

Internal Communication

The importance of communication between departments cannot be overemphasized. For example, who within the facility knows the compliance history referenced above and who within the facility is responsible for keeping up with rule changes and disseminating that information to the affected departments? A team approach is required for education and establishing processes. Be sure to include all key stakeholders.

Checks and Rechecks

Oversight of processes and compliance with the rules is also necessary. Such oversight can be in the form of internal monitoring, internal audits, or audits with contracted external consultants or auditors. This process should start by identifying risk areas and developing an overall compliance audit plan. I recommend considering the issues Medicare agencies and entities are reviewing (such as the OIG Annual Work Plan, MAC medical review topics, etc.)

The tasks of knowing, understanding and implementing processes to keep up with all of the Medicare policies and rules may seem overwhelming, but it is the cost of doing business with Medicare. Like in elementary school, you have to know the rules and you have to comply or you do not get a star for the day.

The October 2016 release of the Medicare Quarterly Provider Compliance Newsletter included two issues specific to hospitals. This article focuses on the Recovery Auditors automated review performed to identify discharge status codes that had been improperly submitted under the IPPS Post-Acute Care Transfer (PACT) Policy.

Recovery Auditor Finding

“Analysis of discharge status codes and secondary claim data identified improper payments. Where a hospital used discharge status code 01, but should have shown a transfer to another care setting with a different discharge status code, the hospital may be overpaid for the inpatient services. It is crucial that hospitals place the correct discharge status code on claims to avoid subsequent overpayment identification and recovery.”

Transfer Policy Background

MLN® Acute Care Hospital Inpatient Prospective Payment System Fact Sheet (ICN 006815) indicates that under the Transfer Policy DRG payments are reduced when:

• The patient’s LOS is at least 1 day less than the geometric mean LOS for the DRG;
• The patient is transferred to another hospital covered by the Acute Care Hospital IPPS or, for certain MS-DRGs, discharged to a post-acute setting (PACT Policy);
• The patient is transferred to a hospital that does not have an agreement to participate in the Medicare Program (effective October 1, 2010); and
• The patient is transferred to a CAH (effective October 1, 2010)

PACT Policy and Discharge Status Codes

Cases with a length of stay less than the Geometric Mean Length of Stay (GMLOS) for a PACT DRG will not reimburse the full Diagnosis Related Group (DRG) payment if the patient was transferred to a post-acute care (PAC) setting. This policy involves the following patient discharge status codes:

When a patient is discharged with the status code of 01, Medicare’s overpayment edit will look for:

• “The presence of a transfer claim to a Skilled Nursing Facility, Cancer Hospital, Psychiatric Hospital, Children’s Hospital, Inpatient Rehab Facility, or Long Term Care Facility that commences or continues within one day of the acute care discharge, or
• A transfer claim to Home Health Care that commences or continues within three days of the acute care discharge.”

How to Avoid this Problem

Medicare advises that “hospitals should take steps to assure claims coders understand that the patient discharge status code is a crucial data element in determining payment for inpatient stays.” They go on to provide links to resources providing more information on how to avoid these errors.

MMP, Inc. advises that key stakeholders in your facility read and share the October 2016 issue of the Medicare Quarterly Compliance Newsletter.

“Observation care is a well-defined set of specific, clinically appropriate services, which include ongoing short term treatment, assessment, and reassessment, that are furnished while a decision is being made regarding whether patients will require further treatment as hospital inpatients or if they are able to be discharged from the hospital.”

Under the two-midnight rule, hospitals may approach the decision for observation services a little differently. When a patient presents to the hospital, the first decision for the physician is, “does the patient require care in a hospital setting?” If the answer to this question is yes, then for patients with an expectation of a two-midnight stay an inpatient admission is appropriate. If the physician does not think the patient will require two midnights of care in the hospital or is unsure, then observation services are generally appropriate. When a patient who is receiving observation services approaches a second midnight in the hospital, a change to inpatient status is appropriate if the patient still requires care in a hospital setting. Considering this, it should be rare that a patient receives observation services beyond a second midnight.

Observation services are not appropriate for preparation time for outpatient testing, or for routing pre-op or post-operative services. Even with the two-midnight rule, observation services still remain a period of treatment or monitoring in order to make a decision concerning the patient’s admission or discharge.

When to Start

“Observation time begins at the clock time documented in the patient’s medical record, which coincides with the time that observation care is initiated in accordance with a physician’s order.”

What does this mean exactly? First, there must be a physician’s order for observation before observation services can begin. Observation orders cannot be back-dated. For example, when condition code 44 is used to change a patient’s status from inpatient to outpatient, observation services do not begin until there is an order for observation (which would be after the change to outpatient status). Observation services would begin at the time that order was written.

If the patient is already actively receiving care, such as in the example above, then observation begins at the time the observation order is written. For patients being transferred to a room after an observation order is written, observation care may not begin until the patient begins to receive evaluation and/or care in the hospital room.

Rounding

Observation hours are rounded to the nearest hour. This means everything from 9:01 through 9:29 is rounded to 9:00 and from 9:31 to 9:59 is rounded to 10:00. 9:30 is ambiguous and could be rounded either way. The example in the Medicare manual is a patient receiving observation services from 3:03 p.m. until 9:45 p.m. – this equals 7 hours of obs.

Concurrent Active Monitoring

“Observation services should not be billed concurrently with diagnostic or therapeutic services for which active monitoring is a part of the procedure (e.g., colonoscopy, chemotherapy).”

Medicare does not provide a list or any examples beyond the two noted in the statement above for what constitutes a procedure with “active monitoring.” This is something the hospital will have to determine, but generally includes near-constant monitoring by a nurse or other health care professional. If such a procedure occurs during a period of observation, the hospital must subtract or “carve out” that time from the total observation hours. This could be accomplished by using the beginning and ending time of the procedure, or Medicare allows hospitals to use an “average length of time” for interrupting procedures and deduct that amount of time from the observation hours.

When to End

“Observation time ends when all medically necessary services related to observation care are completed.”

Observation ending time may not coincide with the time of the physician’s discharge order. Sometimes necessary medical care may end prior to the discharge order or care may extend beyond the time of the discharge order. If after care has ended, the patient is waiting for transportation home, the waiting time should not be included in observation time.

Observation hours end when an order is written to admit the patient as an inpatient. The observation services will be bundled into the inpatient claim, but for accurate records this is when observation counting stops.

Why Bother?

Isn’t observation packaged, so why does the counting of observation hours matter? Well, yes, but no. The outpatient claim line item for observation services, billed with HCPCS code G0378, is a packaged service and receives no separate payment. However, if certain criteria are met, an observation comprehensive APC is paid for the associated visit code, such as any level ED visit, an outpatient clinic visit, or a direct referral for observation services. If 8 or more hours of observation are billed with a visit code and without a primary procedure (status indicator J1) on the claim or surgical procedure (status indicator T) on the day of or before obs, then the claim qualifies for an observation comprehensive APC payment. For 2016, the unadjusted national Medicare payment for the obs C-APC is $2174.14. Definitely worth following the rules.

Hospitals have been dealing with observation services for a long time and most providers probably have their systems down on how to accurately count and report observation services. But a reminder of the rules never hurts. 

Fall is my favorite time of year. How could it not be when kids are going back to school, college football returns, and although the summer heat lingers longer than I would like, we have some spectacular fall foliage. Everything I love about fall at the most basic is consistent from year to year but in truth brings about tremendous change. Maybe it’s my oldest nephew entering high school this year, or the first weekend of regular season football shattering the predictions in the football standings - at the end of the day one constant of fall is change.

The one constant I have seen in health care for more years than I care to think about now is change. Exhibit A: the ICD-10-CM Official Guidelines for Coding and Reporting updates go into effect every fall on October 1st with the start of a new CMS Fiscal Year. In the update, narrative changes appear in bold text. However, with the FY 2017 Guidelines there are some significant changes, of which one in particular has sparked a lot of debate in the Coding and Clinical Documentation Community.

Key NARRATIVE Changes

“With”

“The word “with” should be interpreted to mean “associated with” or “due to” when it appears in a code title, the Alphabetic Index, or an instructional note in the Tabular List. The classification presumes a causal relationship between the two conditions linked by these terms in the Alphabetic Index or Tabular list. These conditions should be coded as related even in the absence of provider documentation explicitly linking them, unless the documentation clearly states the conditions are unrelated. For conditions not specifically linked by these relational terms in the classification, provider documentation must link the conditions in order to code them as related. The word “with” in the Alphabetic Index is sequenced immediately following the main term, not in alphabetical order.”

Code assignment and Clinical Criteria

The New addition to the guidelines, “Code assignment and Clinical Criteria,” is the “hot button” that has sparked much debate as to what this really means.  

“The assignment of a diagnosis code is based on the provider’s diagnostic statement that the condition exists. The provider’s statement that the patient has a particular condition is sufficient. Code assignment is not based on clinical criteria used by the provider to establish the diagnosis.”

This guidance poses a real dilemma for Professional Coders and Clinical Documentation Improvement (CDI) Specialists as we include clinical indicators when constructing a query for the physician and government contractors have become notorious for denying a claim for lack of clinical indicators in the documentation supporting the coded diagnosis. Unfortunately, I have yet to see, read or hear about a good solution for this guidance.

Zika virus infections

1. “Code only confirmed cases
   Code only a confirmed diagnosis of Zika virus (A92.5, Zika virus disease) as documented by the provider. This is an exception to the hospital inpatient guidelines Section II, H.
   
   In this context, “confirmation” does not require documentation of the type of test performed; the physician’s diagnostic statement that the condition is confirmed is sufficient. This code should be assigned regardless of the stated mode of transmission.
   
   If the provider documents “suspected”, “possible” or “probable” Zika, do not assign code A92.5. Assign a code(s) explaining the reason for encounter (such as fever, rash, or joint pain) or Z20.828, Contact with and *suspected) exposure to other viral communicable diseases.”

Hypertension

With the transition to ICD-10 last October there was one code for Hypertension (I-10). There was no longer a way to differentiate when it was actually a “hypertensive crisis” or “hypertensive emergency.”

As of October 1, 2016, they are back.

“Hypertensive Crisis
Assign a code from category I16, Hypertensive crisis, for documented hypertensive urgency, hypertensive emergency or unspecified hypertensive crisis. Code also any identified hypertensive disease (I10-I15). The sequencing is based on the reason for the encounter.”

 

Documented Pressure Ulcer Stage

There are two new changes for 2017. First being for patients admitted with pressure ulcers documented as healing. “For ulcers that were present on admission but healed at the time of discharge, assign the code for the site and stage of the pressure ulcer at the time of admission.”

The second change is for the patient admitted with pressure ulcer evolving into another stage during the admission. “If a patient is admitted with a pressure ulcer at one stage and it progresses to a higher stage, two separate codes should be assigned: one code for the site and stage of the ulcer on admission and a second code for the same ulcer site and the highest stage reported during the stay.”

 

While I have highlighted a few of the key narrative changes, it is worth noting that there are over 40 narrative changes in the guidelines. Looking for specific changes also made me realize how many times the guidelines advise “when documentation is unclear the provider should be queried” (26 times).

From the CDI Specialist perspective the guidelines provide a good foundation for understanding and appreciating the coding conventions to which Coding Professionals must adhere. They are also an essential read for anyone preparing for the Certified Clinical Documentation Specialist (CCDS) exam.

I encourage Coding Professionals and CDI Specialists to read the entire document and be on the lookout for how to register for our fall Inpatient Coding Updates Webinar that is held annually in October.