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A new Point of Origin (PoO) code has been created for reporting patient transfers from a designated disaster alternative care site (ACS). The new PoO was necessary to align with the Discharge Status Code for ACSs, DS code 69, created in response to the COVID-19 public health emergency (PHE). Initially, the National Uniform Billing Committee […]
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CMS distributes a prospectively determined amount of uncompensated care payments to “Medicare disproportionate share hospitals” based on their relative share of uncompensated care nationally.
As required under law, this amount is equal to an estimate of 75 percent of what otherwise would have been paid as Medicare disproportionate share hospital payments, adjusted for the change in the rate of uninsured people.
In this rule, CMS proposes distributing roughly $ 7.8 billion in uncompensated care payments in FY 2021, a decrease of approximately $ 0.5 billion from FY 2020.
For FY 2021, CMS proposes to use a single year of data on uncompensated care costs from Worksheet S-10 of the FY 2017 cost report to distribute these funds, in part because we have conducted audits of this data. Mindful of the unique challenges facing Indian Health Service and Tribal hospitals and Puerto Rico hospitals,
CMS proposes to continue to use data regarding low-income insured days (Medicaid days for FY 2013 and FY 2018 SSI days) to determine the amount of uncompensated care payments for Puerto Rico hospitals and Indian Health Service and Tribal hospitals for one more year (FY 2021), similar to the FY 2020 methodology.
In addition, CMS is proposing for all eligible hospitals, except Indian Health Service and Tribal hospitals, to use the most recent available single year of audited Worksheet S-10 data to distribute uncompensated care payments for all subsequent fiscal years.
We expect there to be an increasing number of hospitals audited for Worksheet S-10 with future cost reporting years.
As a result, we have confidence that the best available data in future years will be the Worksheet S-10 data for cost reporting years for which audits have been conducted.
CMS has delayed the start date of its Emergency Triage, Treat and Transport model from May 1 until this fall.
CMS selected 205 participants in February for the five-year ET3 model. CMS said it is delaying the start date because participants now are focused on responding to the COVID-19 pandemic.
The new model aims to give ambulance care teams more flexibility in how they triage emergencies. The goal of the payment model is to improve care quality and cut costs by reducing unnecessary hospital visits for low-acuity emergencies that do not require a trip to the hospital.
Medicare now pays for emergency ambulance services when beneficiaries are transported to hospitals, skilled nursing facilities and dialysis centers. Most beneficiaries who call 911 with a medical emergency are taken to a hospital emergency department. Under the ET3 model, Medicare will reimburse for transport to an urgent care clinic or primary care office, or for providing care in place or using telehealth.
Read more about the ET3 model here.
Read the summary post in Hospital CFO Report here.
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If long-term care (LTC) facilities want to save a bundle and ensure compliance with federal regulations, the answer is obvious. On Dec. 24, 2003, the Securities and Exchange Commission (SEC) promulgated new investment compliance rules. Pursuant to these rules, effective Oct. 24, 2004, investment companies and investment advisers are required to adopt written compliance procedures, […]
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I originally penned this blog post in 2011 and while the essence of DRGs hasn’t changed much, the coding system has. So here is the ICD-10 update to one of my most popular blog posts of all time. Enjoy!
So you want to be a coder. And not just that, you want to be a hospital coder because, on average, they make more money than physician coders. And you don’t just want to be a hospital coder, you want to be an inpatient hospital coder because then you get to look at the whole chart and piece together the patient’s clinical picture. If this is your goal, then everything you need to know you will not learn in school. And that’s mainly because there is so much to learn and practical experience is key.
Most of all, if you want to be an inpatient coder, you need to know diagnosis-related groups (DRGs) because in hospitals, it’s all about DRGs and case mix – and compliance. If you have no idea what I’m talking about, fear not – here’s a primer on DRGs! I wish I could say I cover it all here, but this is just a beginning!
What is a DRG?
The ICD-10-CM coding systems contains over 72,000 codes. Imagine trying to determine a payment amount for each individual condition. And that doesn’t include accounting for procedures (over 78,000 ICD-10-PCS codes). The most logical solution is to create a system that allows for broader classification of conditions and services for easier comparison and assignment into payment categories. DRGs were created for this purpose. I look at DRGs as a way to “organize the junk drawer” where patients are grouped into different categories based on similar conditions and cost to treat the patient.
History
DRGs were first developed at Yale University in 1975 for the purpose of grouping together patients with similar treatments and conditions for comparative studies. On October 1, 1983, DRGs were adopted by Medicare as a basis of payment for inpatient hospital services in order to attempt to control hospital costs. Since then, the original DRG system has been changed and advanced by various companies and agencies and represents a rather generic term. These days, we have various DRG systems in use – some proprietary and some a matter of public record – all of which group patients in different ways. Two of the main DRG systems currently in use are the Medicare Severity DRG (MS-DRGs) and 3M’s All Patient Refined DRGs (APR-DRGs). Different DRG systems are used by different payers.
How to Get a DRG
All DRG systems are a little different, but the basic premise is the same. DRGs are based on codes. In effect, DRGs are codes made up of codes. The following elements are taken into consideration when grouping a DRG:
Back in the 80s, DRGs were grouped manually using decision trees. These days, DRGs are grouped with the touch of a button and DRG groupers are a big part of encoding software. But I would be doing you a disservice if I didn’t at least give you an idea of the grouper logic. As I mentioned, there are different DRG systems and probably the most popular is the MS-DRG system, so I will explain how MS-DRG grouper logic works.
MS-DRG Grouper Logic
The first step in assigning an MS-DRG is to classify the case into one of the 25 major diagnostic categories (MDC). These MDCs are based on the principal (first) diagnosis and, with a few exceptions, are based on body systems, such as the female reproductive system. Five MDCs are not based on body systems (injuries, poison and toxic effect of drugs; burns; factors influencing health status (V codes); multiple significant trauma; and human immunodeficiency virus infection). Organ transplant cases are not assigned to MDCs, but are immediately classified based on procedure, rather than diagnosis. These are called pre-MDC DRGs.
Once a case has been assigned into an MDC (with the exception of the transplant pre-MDCs), it is determined to be either medical or surgical. Surgical cases require more resource consumption (that’s industry speak for “costs more!”), so they must be separated from the medical cases. If there are no procedure codes on the case (e.g., a patient with pneumonia may have no procedure codes), then it’s simple – it’s a medical case. But if the patient had a procedure, that procedure may or may not be considered surgical. For example, an appendectomy is quite clearly a surgical procedure. But something like suturing a laceration is not. It’s all based on resource consumption – the cost of performing the procedure. For the most part, anything requiring an operating room is surgical.
Okay, so now that we have our MDC and a designation as medical or surgical, we need to look at the other diagnoses on the claim. Right now, Medicare is able to process the first 18 diagnoses on the claim. These other diagnoses, depending on their severity, may be designated as complications and comorbidities (CCs) or major complications and comorbidities (MCCs). Medicare maintains lists of CCs and MCCs and updates them annually. CCs and MCCs are conditions that have been identified as significantly impacting hospital costs for treating patient with those conditions. For example, it’s been determined that congestive heart failure without further specification does not significantly impact costs and it is not a CC/MCC. However, patients with chronic systolic or diastolic heart failure do have slightly higher costs, so those conditions are CCs. More so, patients with acute systolic or diastolic heart failure have even higher costs, so they are designated as MCCs. Are you beginning to see how slight changes in a physician’s diagnostic statement impact coding and thus payment?
DRG Weights
Now that we know the MDC, whether the case is medical or surgical, and whether or not there are any CCs or MCCs, how does that translate into reimbursement? Well, if you’re using an encoder (and if you code for a hospital, you will), you hit a button and presto! You have a DRG with a relative weight. Now if only you knew what that relative weight meant. The DRG relative weight is the average amount of resources it takes to treat a patient in that DRG. Huh?
Let me demonstrate. The baseline relative weight is 1 and represents average resource consumption for all patients. Anything less than 1 uses less than average resources. Anything above 1 uses more than average resources. So let’s compare some respiratory MS-DRGs:
You can see how different combinations of codes lead to different MS-DRGs with different relative weights. In order to convert that into monetary terms, we multiply the relative weight by the hospital base rate. Now I’m sure you want to know how to get that hospital base rate. Me too. Well, up to a point. The base rate is exclusive to each hospital and takes a lot of historical, facility-specific data into account, like what they’ve been paid in the past, whether they are an urban or rural hospital, and how much the hospital pays out in wages. That’s just more math than my poor little head can comprehend! So for the purposes of this exercise, let’s pretend like this hospital – we’ll call it Happyville Hospital – has a base rate of $ 5000. So if we multiply the relative weights above by $ 5000, our reimbursement for those cases, respectively, is $ 53,932, $ 3,411, and $ 5,720.
Case Mix
You just might be asked in an interview if you understand case mix. It’s a good indication of whether someone really understands DRGs. And I have to admit, in my sometimes sadistic manner, I like seeing that look of glazed-over confusion on someone’s face when I bring up case mix. But case mix is simple. It’s the average relative weight for a hospital. So get out a big piece of paper for your hospital and start writing down the relative weights for every single case and then divide to get your average. Okay, so it’s computerized now. But that’s all case mix is – an average.
In the industry, we officially refer to case mix as the type of patients a hospital treats. Let’s say at Happyville, we have a high volume of transplant cases plus a trauma center and a well-renowned cardiac program. These are all highly weighted types of cases and our overall case mix will be higher than say, Anytown Hospital down the street that has no trauma center, no transplant program, and basic cardiac services (they transfer all their serious cardiac cases to Happyville!). Happyville’s case mix will be higher than Anytown’s.
As a coder, you don’t need to know what your specific hospital’s case mix is at any given time. But knowing what impacts case mix is an indication that you know your stuff. First and foremost, case mix fluctuates. Most hospitals monitor case mix on a monthly basis because changes in case mix are a precursor to changes in reimbursement. Of course your CFO wants case mix to continue to rise, but that could be a red flag. And he certainly doesn’t want case mix to fall. If case mix begins to decrease, the first place hospital administration usually looks is coding – after all, case mix is based on DRGs, which are based on codes. But there are lots of things that can impact case mix and many of them have nothing to do with coding, such as:
Your Life as an Inpatient Coder
As an inpatient coder your job is to make sure you get all the codes on the claim in the correct order so that the accurate DRG is assigned and the hospital gets paid appropriately. When I put it that way, it sounds so easy! The reality is, with more and more patients being treated as outpatients, those who are admitted as inpatients are sicker than they’ve ever been. And sicker means harder to code. For instance, the patient comes in with shortness of breath and the final diagnosis is acute exacerbation of COPD, staphylococcal pneumonia, and respiratory failure. How you code and sequence the case will determine the appropriate DRG and reimbursement. The good news is, you’ll have an encoder to help you model the DRGs and see what pays what. The bad news is, you have to paw through the medical record to determine the true underlying cause of that shortness of breath.
So are you ready for the challenge? Are you ready to apply DRGs?
Coder Coach
Direct primary care (DPC) is one of the newer forms of plans offered by primary care providers to their patient populations. Some see DPC as an alternative to traditional third-party payment for care and other more recent models such as concierge medicine. Primary care providers are tired of the consumable resources required to submit claims […]
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Chronic care management (CCM) services are services that do not involve face-to-face patient/provider contact. The Centers for Medicare & Medicaid Services (CMS) implemented Medicare coverage for CCM in Jan. 1, 2015. There are very specific guidelines providers need to follow to be reimbursed for CCM services rendered to Medicare patients, but it appears CMS is […]
The post OIG Uncovers Medicare Overpayments for Chronic Care Management Services appeared first on AAPC Knowledge Center.
Help physicians and patients understand exactly what it all means. One of the most asked questions coders get from patients at an orthopedic practice is: “Why is there a surgical code on my bill for an office visit?” It’s a valid question coming from a patient who was seen in the clinic, treated for a […]
The post Get a Global Perspective on Orthopedic Fracture Care Coding appeared first on AAPC Knowledge Center.
Timing is everything when defining and capturing the 7th character in an ICD-10-CM code. ICD-10-CM brought about new concepts for diagnosis coding, with some being straightforward and others being a bit confusing when interpreting the guidelines. One concept that is often debated is how to select the correct seventh character, representing the episode of care. […]
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A Greensboro-based medical transport company was sentenced in court for health care fraud after pleading guilty to one count of health care fraud in October 2018, according to US Attorney lawyer Matthew G.T. Martin of the District of North Carolina. The company in question, Gate City Transportation, was ordered to pay a $ 100 fine, a $ 400 penalty tax, and restitution over five million. The funds would go, in their entirety, to the N.C. Fund for Medical Assistance. The verdict and penalty was handed down by US District Court Judge Loretta “Copeland” Biggs of the District of North Carolina.
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