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CMS estimates a $ 2.3 billion increase in hospital payments next year due, in part, to a 2.5 percent bump in reimbursement rates under Medicare’s IPPS. On Aug. 2, 2021, the Centers for Medicare and Medicaid Services (CMS) posted the fiscal year (FY) 2022 Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) Prospective Payment […]
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2017 IPPS final rule and claims-based measures
by Shannon Newell, RHIA, CCS, AHIMA-approved ICD-10-CM/PCS trainer
The fiscal year (FY) 2017 IPPS final rule was released August 2 and will be published in the Federal Register August 22. The majority of the finalized updates are consistent with those outlined in the proposed rule, but with a few refinements to applicable time periods. The final rule expands and refines the number of claims-based outcomes linked to payment under these programs.
Let’s review a few of the key changes to support your CDI program’s strategic focus for the coming year.
Risk-standardized readmission rates
Risk-standardized readmission performance for the coronary artery bypass graft (CABG) cohort will be linked to reimbursement in FY 2017. The applicable time period for discharges used to assess performance in FY 2017 has passed, but today’s discharges will impact performance in FY 2018.
This is a great example of why it’s important to focus on new measures adopted in this year’s rule for future program years. CMS utilizes a two- to three-year historical window of data for claims-based measures, so today’s performance impacts us financially two to three years in the future.
Risk-adjusted PSI 90 composite
The current Patient Safety Indicator (PSI) 90 measure will continue to be utilized in the Hospital-Acquired Condition Reduction Program (HACRP) and Hospital Value-Based Purchasing Program (HVBP) through FY 2018. At that time:
The modified PSI 90 composite, also called the Patient Safety and Adverse Events Composite, was finalized as proposed. A review of key modifications follows:
Applicable time periods for the measure were shortened as proposed, although date ranges were revised as noted below in italicized font:
Performance scoring for the HACRP will adopt Winsorized z-scores instead of deciles.
Risk-standardized mortality measures
Risk-adjusted CABG mortality performance will impact financial reimbursement under the HVBP effective with the FY 2022 program. The applicable time periods that will be used to assess performance at that time follow:
The pneumonia cohort will expand to include patients with a principal diagnosis of aspiration pneumonia and/or patients with a principal diagnosis of sepsis and a secondary present-on-admission diagnosis of pneumonia:
Cost measures
The previously adopted HVBP payment measure for pneumonia (hospital-level, risk-standardized payment associated with a 30-day episode of care for pneumonia) will expand the pneumonia cohort.
The expanded cohort will be consistent with the cohort definition used for the risk-adjusted readmission measure in the Hospital Readmissions Reduction Program (HRRP) and the risk-adjusted mortality measure used in the HVBP:
Two new payment measures will be added to the efficiency and cost reduction domain in the HVBP beginning FY 2021:
These payment measures are intended to be paired with the 30-day mortality measures, thereby directly linking payment to quality by the alignment of comparable populations and risk adjustment methodologies to facilitate the assessment of efficiency and value of care:
Performance for these new measures will be scored using the methodology for the Medicare spending per beneficiary measure.
Summary
Effective October 1, 2017, performance for cost and quality measures in the HRRP, HVBP, and HACRP will impact up to 6% of your hospital’s inpatient acute Medicare fee-for-service reimbursement.
So, where to begin? First, become familiar with the measure specifications and risk adjustment methodologies, in addition to existing CMS provided reports on historical performance, to gain insights into your organization’s clinical documentation and coding vulnerabilities.
Measure specifications can be found at: www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Measure-Methodology.html.
The final rule is available here: www.federalregister.gov/public-inspection.
Editor’s note: Newell is the director of CDI quality initiatives for Enjoin. She has extensive operational and consulting expertise in coding and clinical documentation improvement, performance improvement, case management, and health information management. You can reach Newell at [email protected]. Opinions expressed are that of the author and do not represent HCPro or ACDIS.
2017 IPPS final rule and claims-based measures
by Shannon Newell, RHIA, CCS, AHIMA-approved ICD-10-CM/PCS trainer
The fiscal year (FY) 2017 IPPS final rule was released August 2 and will be published in the Federal Register August 22. The majority of the finalized updates are consistent with those outlined in the proposed rule, but with a few refinements to applicable time periods. The final rule expands and refines the number of claims-based outcomes linked to payment under these programs.
Let’s review a few of the key changes to support your CDI program’s strategic focus for the coming year.
Risk-standardized readmission rates
Risk-standardized readmission performance for the coronary artery bypass graft (CABG) cohort will be linked to reimbursement in FY 2017. The applicable time period for discharges used to assess performance in FY 2017 has passed, but today’s discharges will impact performance in FY 2018.
This is a great example of why it’s important to focus on new measures adopted in this year’s rule for future program years. CMS utilizes a two- to three-year historical window of data for claims-based measures, so today’s performance impacts us financially two to three years in the future.
Risk-adjusted PSI 90 composite
The current Patient Safety Indicator (PSI) 90 measure will continue to be utilized in the Hospital-Acquired Condition Reduction Program (HACRP) and Hospital Value-Based Purchasing Program (HVBP) through FY 2018. At that time:
The modified PSI 90 composite, also called the Patient Safety and Adverse Events Composite, was finalized as proposed. A review of key modifications follows:
Applicable time periods for the measure were shortened as proposed, although date ranges were revised as noted below in italicized font:
Performance scoring for the HACRP will adopt Winsorized z-scores instead of deciles.
Risk-standardized mortality measures
Risk-adjusted CABG mortality performance will impact financial reimbursement under the HVBP effective with the FY 2022 program. The applicable time periods that will be used to assess performance at that time follow:
The pneumonia cohort will expand to include patients with a principal diagnosis of aspiration pneumonia and/or patients with a principal diagnosis of sepsis and a secondary present-on-admission diagnosis of pneumonia:
Cost measures
The previously adopted HVBP payment measure for pneumonia (hospital-level, risk-standardized payment associated with a 30-day episode of care for pneumonia) will expand the pneumonia cohort.
The expanded cohort will be consistent with the cohort definition used for the risk-adjusted readmission measure in the Hospital Readmissions Reduction Program (HRRP) and the risk-adjusted mortality measure used in the HVBP:
Two new payment measures will be added to the efficiency and cost reduction domain in the HVBP beginning FY 2021:
These payment measures are intended to be paired with the 30-day mortality measures, thereby directly linking payment to quality by the alignment of comparable populations and risk-adjustment methodologies to facilitate the assessment of efficiency and value of care:
Performance for these new measures will be scored using the methodology for the Medicare spending per beneficiary measure.
Summary
Effective October 1, 2017, performance for cost and quality measures in the HRRP, HVBP, and HACRP will impact up to 6% of your hospital’s inpatient acute Medicare fee-for-service reimbursement.
So, where to begin? First, become familiar with the measure specifications and risk-adjustment methodologies, in addition to existing CMS provided reports on historical performance, to gain insights into your organization’s clinical documentation and coding vulnerabilities.
Measure specifications can be found at: www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Measure-Methodology.html.
The final rule is available here: www.federalregister.gov/public-inspection.
Editor’s note
Newell is the director of CDI quality initiatives for Enjoin. She has extensive operational and consulting expertise in coding and clinical documentation improvement, performance improvement, case management, and health information management. You can reach Newell at [email protected]. Opinions expressed are that of the author and do not represent HCPro or ACDIS.
Case study
MOON requirement delayed in IPPS final rule
Learning objective
At the completion of this educational activity, the learner will be able to:
Hospitals got a last-minute reprieve from the MOON notification requirement, which was set to go into effect August 6. Citing the need for additional time to revise the standardized notification form that hospitals will need to use to notify patients about the financial implications of being assigned to observation services, CMS moved back the start date for the requirement in the 2017 Inpatient Prospective Payment System (IPPS) final rule to "no later than 90 days," after the final version of the form is approved.
CMS released the new draft of the form August 1 and planned to accept public comments for 30 days. Some experts said that this could mean a January 1, 2017, start date for the requirement, but that remains to be determined, says Stefani Daniels, RN, MSNA, ACM, CMAC, founder and managing partner of Phoenix Medical Management, Inc., in Pompano Beach, Florida.
A reprieve for struggling hospitals
The decision to push back the notification requirement start date was likely a relief for many hospitals who reported struggling this summer to comply with the notification requirement, formally known as the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act, which was signed by President Barack Obama August 6. (See related story on p. 3.) The act requires hospitals to provide a verbal and written notice of outpatient status to any patient in observation who has been in the hospital for more than 24 hours, stipulating that hospitals must inform patients within 36 hours from the start of the service, or at the time of discharge, about their status.
The goal of the legislation is to ensure patients are aware of their status and what it might mean for them financially?in particular, how it might affect their postacute care options.
Patients often (wrongly) assume that if they’re in a hospital bed, they are an inpatient.
They also don’t understand the implications of outpatient billing status.
One of the biggest issues that can crop up when a patient’s care orders place him or her on observation status is that he or she will not be eligible for Medicare coverage for a postacute stay in a skilled nursing facility (SNF), and instead may need to pay more out of pocket. Medicare currently only covers SNF extended care rehabilitation services for patients who have three consecutive inpatient days in a hospital. For example, one day in observation and two days as inpatient equals three days in the hospital, but does not meet the three-day inpatient day stay requirement because it only includes two inpatient days.
"An Office of Inspector General report found that the average out-of-pocket cost for SNF services not covered by Medicare was more than $ 10,000 per beneficiary," stated a press release issued by the congressional leaders who promoted the bill (http://ow.ly/S6JSB).
To comply with the rule, hospitals will now need to designate someone?in some cases it may be the case manager?to provide this notification.
A changing requirement
The 2017 IPPS final rule shed a few additional details about the notification requirement, including that "hospitals and CAHs may deliver the MOON to individuals receiving observation services as an outpatient before such individuals have received more than 24 hours if "the individual is transferred, discharged, or admitted as an inpatient," says Daniels. The final rule also states that insurers must notify patients of any changes in status initiated by the insurer before he or she has left the hospital.
"Too often, hospital business office reps are informed that a level of care change to observation services is being made by the insurer long after the patient has left the hospital. This could result in the risk of noncompliance with the NOTICE Act," says Daniels.
CMS issued a revised version of the MOON document from the first draft of the document, which was published on the PRA website (http://ow.ly/7TPE302eSiM). (See the new version of the form on pp. 7?8.)
"CMS has made substantive changes to the MOON from the first iteration. The old MOON cannot be used," says Ronald Hirsch, MD, FACP, CHCQM, vice president of the Regulations and Education Group at Accretive Health in Chicago.
The new version of the MOON document requires a narrative outlining why the patient is being placed in outpatient status with observation services. "CMS says that in the future it will consider model language for use in this section. The MOON ‘additional information’ section may be used to add information to meet any state law observation notification requirements that differ from the MOON federal requirements but the MOON may not be used for non-Medicare/Medicare Advantage (MA) patients," says Hirsch.
The final rule also says that the MOON is required for any Medicare/MA patient who receives 24 hours of observation and must be given to the patient within 36 hours. But CMS allows the MOON to be given to any Medicare/MA patient who receives observation services.
"On the other hand, CMS ‘encourages hospitals not to deliver the MOON at the initiation of observation services,’ at which point patients may be overwhelmed and confused," says Hirsch.
When organizations are determining which patient should get the MOON, observation hour counting should begin with the order for observation. The 24-hour period is consecutive and "carved out hours" should not be considered, says Hirsch.
CMS doesn’t dictate which staff members can deliver the MOON, rather leaving that up to the hospital or CAH to decide.
In addition, it states that patients don’t have the right to appeal their placement in outpatient status with observation services, says Hirsch. "CMS removed the QIO quality complaint reference on the MOON to avoid confusion about this," he says.
Organizations should note that the MOON is required for patients in whom Medicare is a second payer and for all patients with MA plans even though the copayments and SNF requirements for those patients may differ from those described on the MOON.
Stay tuned for future updates on this topic as CMS works on the MOON and other details of the requirement.
MOON requirement delayed in IPPS final rule: What next?
Hospitals got a last-minute reprieve from the Medicare Outpatient Observation Notice (MOON) notification requirement, which was set to go into effect August 6. Citing the need for additional time to revise the standardized notification form that hospitals will need to use to notify patients about the financial implications of being assigned to observation services, CMS moved back the start date for the requirement in the 2017 IPPS final rule to ‘no later than 90 days,’ after the final version of the form is approved (www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2017-IPPS-Final-Rule-Home-Page.html).
CMS released the new draft of the form (www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing-Items/CMS-10611.html?DLPage=1&DLEntries=10&DLFilter=10611&DLSort=1&DLSortDir=descending) August 1 and accepted public comments for 30 days. The MOON notification form is intended to be used to help hospitals comply with the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act. The Act requires hospitals to provide a verbal and written notice of outpatient status to any patient in observation who has been in the hospital for more than 24 hours, stipulating that hospitals must inform patients within 36 hours from the start of the service about their status. However, without a final version of the form ready for use, it would appear that hospitals cannot comply with the NOTICE Act at this time.
‘Hospitals should review the IPPS final rule that contains significant clarification on things like when and how the notice is delivered and finalize their own policies for delivering the notice pending the final version of the MOON being available,’ says Kimberly Anderwood Hoy Baker, JD, CPC, director of Medicare and compliance for HCPro in Middleton, Massachusetts.
CMS stated in the 2017 IPPS final rule:
We expect the final [Paperwork Reduction Act] PRA approval of the MOON around the time the implementing regulations are effective. Therefore, the implementation period for hospitals and CAHs will begin sometime after the effective date of this final rule and will be announced on the CMS Beneficiary Notices Initiative Website at: www.cms.gov/Medicare/Medicare-General-information/Bni/index.html and in an HPMS memorandum to MA plans. During this implementation period, hospitals and CAHs will have time to prepare for implementation, consistent with past implementation practices for beneficiary notices. Hospitals and CAHs will be required to deliver the MOON to applicable patients who begin receiving observation services as outpatients on or after the notice implementation date.
‘Hospitals should watch the Beneficiary Notice Initiative page, where CMS said they would announce implementation information, for more information on the finalization of the MOON and implementation time frames,’ says Baker.
Hospitals will likely not be required to provide the MOON notification form to patients until 90 days after PRA approval, which could mean compliance with the MOON and NOTICE Act is at least 120 days out from the final rule release date given that there is also a 30-day comment period on the revised form, according to Baker.
‘When the final version of the notice form is ready for use, hospitals should use the 90-day implementation period to develop a mechanism for the form to be in their EHR with a trigger to print the notice when the patient is registered as or has a status change to observation. This will allow for the form to be delivered by the designated individual to the patient immediately rather than attempting to do it at discharge,’ says Rose T. Dunn, MBA, RHIA, CPA, FACHE, chief operating officer for First Class Solutions, Inc.
The message should be delivered by hospital staff who are well versed in the purpose of the notice and how patient status may financially impact the patient. Dunn recommends that hospitals choose patient access staff, financial counselors, or utilization review/case management staff to deliver the MOON rather than patient care staff.
The role of HIM in MOON compliance
While many facilities plan to task departments outside of HIM with delivering the verbal and written notice to observation patients, that does not mean there isn’t a seat at the table for HIM when it comes to operationalizing this regulation.
At Via Christi Health in Wichita, Kansas, Sam Antonios, MD, FACP, FHM, CCDS, medical director of medical information and ICD-10 physician advisor, and his colleagues are working to ensure they understand the nuances of the MOON.
Antonios’ facility is currently building a daily report to help track patients who have been in observation 24 hours.
The report will help the facility ensure compliance with the NOTICE Act and MOON, but this may be a challenge for facilities that do not have the capability to create such a document in their electronic systems. But even with the right systems and alerts in place, relying on just one report may present challenges. ‘For example, you may have patients who don’t have the right trigger from the initiation of observation services,’ Antonios says. Remember, the MOON must be delivered 24?36 hours after the initiation of observation services, which is not always the time when the patient entered the hospital, especially for those in the emergency department, he says.
In general, HIM should aid in the creation of reports listing any admission for Medicare beneficiaries in observation. Records for patients who have been in observation for more than 24 hours should be flagged when the report is run, which should ideally be done twice daily and be sent to the team tasked with delivering the MOON, Antonios says.
HIM must play a role in deciding what to do with the MOON when it is completed and how to track verbal notification of observation status, Antonios says. Should HIM scan the MOON forms immediately for inclusion in the patient’s medical record, or should scanning be completed at the end of the patient’s hospital stay? Deciding which option is best may depend on the needs of your facility and staffing patterns.
‘HIM professionals should ensure that the form is properly signed and scanned into the appropriate section of the medical record where it can be consistently found during an audit,’ says Edward Hu, MD, CHCQM-PHYADV, system executive director of physician advisor services at UNC Health Care system in Chapel Hill, North Carolina, and president of the American College of Physician Advisors. In addition, HIM will also play a role in ensuring the CMS-approved MOON is given to observation patients, Hu says.
In an era when hospitals are increasingly using electronic methods of documentation and communication, it may be tempting to create an electronic version of the MOON for patients to read and sign. However, Hu notes that if this practice is implemented the patient must still receive a paper copy of the form. ‘Hospitals must provide a signed paper copy of the MOON to the beneficiary, even if he or she reviews and signs on an electronic pad,’ he says. ‘The hospital must provide the MOON on paper for the beneficiary’s review if the beneficiary asks to review a paper version.’
Tracking and delivering the MOON is one hurdle to overcome, but so too is ensuring that patients understand the information presented to them. Language barriers can present a challenge when delivering the MOON. While it may be relatively easy to obtain a copy of the notice for patients who speak more common languages like Spanish, it is a bit more difficult at Antonios’ facility where patients speak a variety of languages that the form is not available in. In turn, staff may have a difficult time verbally notifying patients of observation status during off hours when a translator is unavailable, he says.
Hu notes that HIM can play a role in ensuring the Spanish-language version of the MOON is made available to patients and staff when it is approved by CMS. ‘Hospitals also have an obligation to provide the information on the MOON in a language and manner that the patient understands. Although this does not mean the MOON must be translated into every language, it does mean that the hospital has an obligation to ensure understanding by beneficiaries with limited English proficiency,’ he says.
The ups and downs of MOON
Complying with the NOTICE Act and operationalizing MOON has presented a significant challenge for healthcare organizations. Some are unsure of how to deliver the form and little is known about the impact it will have on patient relations and hospital staffing.
The verbal and written notice to observation patients should be given between 24 and 36 hours of the patient being placed in this status, which has many wondering whether they should actually wait 24 hours to deliver the notice since it can be challenging to ensure the notice is given before the 36-hour mark, says Antonios. ‘It leaves you with an open window of only 12 hours of actually being able to deliver before missing the deadline,’ Antonios says. Failure to deliver the notice within the given time frame can result in noncompliance.
While Antonios points out that CMS stated in the 2017 IPPS final rule that facilities can deliver the MOON prior to 24 hours of observation care, this may not always be the best option?especially since CMS noted that it discourages this practice. Delivering it before the 24-hour ma=rk as a proactive measure to ensure observation patients in need of the notice are not overlooked?or even delivering it on time?can present challenges since an observation stay can often become an inpatient stay based on a physician’s finding during the early hours of patient care, Antonios says.
Whether you decide to wait 24 hours or deliver the MOON as soon as observation status is initiated, there will be pros and cons.
Not waiting for the 24-hour mark may mean the verbal and written notice were given but not needed and could result in patients who are confused about their status and the financial implications of it. ‘It’s so early in the process that you may have people switched to inpatient before 24 hours and then you would have wasted the little bit of energy and resources to do a task that you didn’t need to do, because if you switch someone before 24 hours you don’t have to give them anything,’ Antonios says.
Delivering the MOON to all patients when they are first assigned to observation makes it easier to capture these Medicare beneficiaries before the 24?36-hour window passes, he says. It lends a fair amount of standardization and automation to the process of complying with the NOTICE Act and MOON, Antonios says.
However, ensuring that staff who are educated on completing the written notice and verbally explaining observation to patients are available at all times is not an easy task. While emergency departments (ED) are often well staffed during nights and weekends, other areas of hospitals may not have the same coverage, which could result in noncompliance if the MOON delivery window is missed. The ED?be it registration or other staff?may be the ideal setting for delivering the MOON if it is done routinely prior to the 24-hour mark. ‘Staffing on the floor goes down significantly after hours. It goes down significantly during the weekend, but the ED typically still has staff,’ Antonios says. ‘People receive paperwork in the ED anyway. It’s part of the process.’
CMS’ 2017 IPPS final rule released
CMS released the fiscal year (FY) 2017 IPPS final rule August 2, and ICD-10-CM/PCS code changes and the addition of the Medicare Outpatient Observation Notice (MOON) both had starring roles. CMS also made changes to several quality initiatives and reversed the agency’s 0.2% payment reduction instituted along with the 2-midnight rule first implemented in the FY 2014 rule.
"Most coders have been hearing about the magnitudes of new codes being added to the ICD-10-CM and ICD-10-PCS code sets, and the final rule does not disappoint," says Shannon McCall, RHIA, CCS, CCS-P, CPC, CPC-I, CEMC, CRC, CCDS, director of HIM and coding for HCPro, a division of BLR, in Middleton, Massachusetts.
ICD-10-CM and ICD-10-PCS updates
The final rule includes tables with nearly 2,600 lines of new ICD-10-CM codes and 14,000 lines of ICD-10-PCS codes on the associated Excel spreadsheets, some of which were not mentioned in the proposed rule, says McCall.
"Even with the thousands of additions to the ICD-10-CM code set, I think many will find that the additions look scarier than they actually are," says McCall. "For example, adding laterality (right, left, bilateral, unspecified) to conditions like diabetes mellitus retinopathy codes (categories E08?E11 and E13) equated to over 250 ‘new’ codes, but in reality, they are just added specificity that equate them to the detail in other eye disorder codes."
The eye disorders (Chapter 7, categories H00?H59) overall have a significant number of additions by way of further specificity like new stages or presence of symptoms?creating over 300 codes in that category, says McCall.
CMS has also introduced nearly 4,000 new codes for ICD-10-PCS in the final rule. But, McCall says, similar to the ICD-10-CM additions, some of the new ICD-10-PCS codes aren’t new procedures, but simply increases in specificity for one or more characters, which may result in hundreds of new codes.
"An example is the added distinction by subdividing the body part option of the thoracic aorta into the ascending/arch and descending portions," says McCall. "Therefore, any PCS table that included an option for the thoracic aorta now includes different body part values for ascending/arch thoracic aorta and descending thoracic aorta. These can create hundreds of codes once you provide all approach options, all device options, and all qualifier options for the associated ICD-10-PCS tables."
One of the more significant coding changes CMS has made, says McCall, is recognizing hundreds of procedures that were illogically considered surgical in ICD-10-PCS for FY 2016 but will be reclassified as nonsurgical in FY 2017. The intent of the transition from ICD-9-CM Volume 3 to ICD-10-PCS was for procedures to remain in the same (or similar) MS-DRGs that they occupied prior to ICD-10 implementation. However, not all codes were successfully reclassified. The 2017 IPPS final rule addresses some of these instances, including percutaneous drainage procedures such as paracentesis, as well as procedures like esophageal banding and arterial catheterization. Tables 6P.4a?6P.4k include all the procedures that will be reassigned as nonsurgical for FY 2017, says McCall.
"The reason for the assignment errors were mapping errors from ICD-9-CM Volume 3 to ICD-10-PCS. For example, the mapping for paracentesis (whether it was diagnostic or therapeutic) should have been to ICD-9-CM Volume 3 procedure code 54.91, but for some reason a diagnostic paracentesis was mapped to 54.29 (other diagnostic procedures on abdominal region)," says McCall.
CMS responded in the final rule to this mapping issue by saying:
We agree with the commenters that diagnostic drainage of the peritoneal cavity is more accurately replicated with ICD-9-CM procedure code 54.91 (percutaneous abdominal drainage) for reporting diagnostic paracentesis procedures and it is designated as a non-O.R. procedure. Therefore, we agree that the designation of ICD-10-PCS procedure code 0W9G3ZX (drainage of peritoneal cavity, percutaneous approach, diagnostic) should also be changed from O.R. to non-O.R.
The MOON form
In addition to creating new diagnosis and procedure codes, CMS also created the MOON as part of the Notice of Observation Treatment and Implication for Care Eligibility Act.
The MOON is a CMS-developed standardized notice hospitals are required to give to Medicare patients. These patients must be receiving observation services as an outpatient for more than 24 hours, and the MOON must be given no later than 36 hours after observation services are initiated. Hospitals must give a verbal explanation of the MOON to patients and obtain a signature to acknowledge receipt and understanding of the notice.
Payment adjustments
CMS also indicated that payment rates will increase by 0.95% in FY 2017 compared to FY 2016 for hospitals participating in the Inpatient Quality Reporting (IQR) Program and EHR meaningful use, according to the rule.
"This also reflects a 1.5 percentage point reduction for documentation and coding required by the American Taxpayer Relief Act of 2012 and an increase of approximately 0.8 percentage points to remove the adjustment to offset the estimated costs of the two-midnight policy and address its effects in FYs 2014, 2015, and 2016," said CMS.
In addition, CMS created two adjustments to reverse the effects of the 0.2% cut it instituted along with the 2-midnight rule, which has been the source of an ongoing legal challenge by the American Hospital Association and other parties. More on this story can be found here: www.hcpro.com/HIM-320994-859/Court-gives-providers-a-chance-to-comment-on-2midnight-rule-payment-reduction.html.
CMS made a permanent adjustment of approximately 0.2% to remove the cut for FYs 2017 and onward, and a temporary adjustment of 0.8% to address the retroactive impacts of this cut for FYs 2014, 2015, and 2016.
Quality program updates
CMS finalized five changes to the Hospital-Acquired Condition Reduction Program in this rule, as well as updates to the IQR Program, changes to the Hospital Readmissions Reduction Program, and updates to the Hospital Value-Based Purchasing Program.
Listening to commenter feedback, CMS reduced requirements for reporting electronic clinical quality measures (eCQM) as part of the IQR Program. Originally, CMS proposed requiring hospitals to submit data on all 15 eCQMs, but finalized a policy requiring hospitals to report four quarters of data on an annual basis for eight of the available eCQMs.
The entirety of the final rule is available in PDF format on the Federal Register, and it is expected to be officially published Monday, August 22. CMS says the rule applies to approximately 3,330 acute care hospitals and approximately 430 long-term care hospitals, and it will affect discharges occurring on or after October 1, 2016.
The final rule can be downloaded here: www.federalregister.gov/public-inspection.
The related CMS fact sheet can be viewed here: www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2016-Fact-sheets-items/2016-08-02.html.
The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule April 14 that would update 2018 Medicare payment and polices in the Inpatient Prospective Payment System (IPPS) and Long-term Care Hospitals Prospective Payment System (LTCH PPS). The proposed changes apply to approximately 3,330 acute care hospitals and approximately 420 LTCHs and, if finalized, […]
AAPC Knowledge Center
Originally Published in MLN Connects
On August 2, CMS issued a final rule to update FY 2017 Medicare payment policies and rates under the Inpatient Prospective Payment System (IPPS) and the Long-Term Care Hospital (LTCH) Prospective Payment System (PPS). The final rule, which would apply to approximately 3,330 acute care hospitals and approximately 430 LTCHs, would affect discharges occurring on or after October 1, 2016.
The final increase in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful Electronic Health Record (EHR) users is approximately 0.95 percent. This reflects the projected hospital market basket update of 2.7 percent adjusted by -0.3 percentage point for multi-factor productivity and an additional adjustment of -0.75 percentage point in accordance with the Affordable Care Act. This also reflects a 1.5 percentage point reduction for documentation and coding required by the American Taxpayer Relief Act of 2012 and an increase of approximately 0.8 percentage points to remove the adjustment to offset the estimated costs of the Two Midnight policy and address its effects in FYs 2014, 2015, and 2016.
The final rule also includes:
See the full text of this excerpted CMS fact sheet (issued August 2).
The Medical Management Institute – MMI – Medical Coding News & MMI Updates
General acute hospitals paid under the Inpatient Prospective Payment System (IPPS) that successfully participate in the hospital Inpatient Quality Reporting Program and are meaningful electronic health record (EHR) users will see an estimated 0.95 percent increase in operating payment rates in 2017, according to a final rule issued Aug. 2. Reflected in this payment update […]
AAPC Blog