CMS included a major surprise when it released its final rule for the FY 2012 Inpatient Prospective Payment System integral to inpatient Medicare reimbursement at short-term and long-term acute care hospitals as announced in an August 1 press release.
The rule makers set a documentation and coding adjustment (DCA) of -2.0% instead of the proposed -3.15% for fiscal year (FY) 2012, according to the 2012 inpatient prospective payment system (IPPS) final rule released August 1.
CMS originally proposed a year-over-year reduction of 0.5% in payments to acute care hospitals under the FY 2012 IPPS, including a DCA of -3.15%. However, CMS finalized a cut of 2.0%, a decrease from 2.9% in FY 2011, which translates to $1.13 billion more in hospital payments in FY 2012 than they had received in the previous year.
“We’re very pleased to see that CMS has scaled back their proposed coding cuts,” says Joanna Kim, senior associate director for policy for the American Hospital Association (AHA) in Washington, DC. “We are quite disappointed that CMS did not change their methodology of analyzing documentation and coding, but are glad they recognized that the proposed 3.15% cut would be very difficult for hospitals to absorb all in one year.”
Kim suggests that hospitals look closely at the new payment rates and make sure they can budget appropriately.
James S. Kennedy, MD, CCS, managing director for FTI Healthcare in Atlanta, agrees that the temporary reprieve is a positive for hospitals. “The DCA is what it is. At least for next year, it’s good that we got a break,” he says. “But CMS will maintain its current methodology of calculating it and will continue to assess it to hospitals until they have recouped what they believe they have overpaid.”
“We recognize the concerns regarding possible financial disruption that may be caused by the proposed documentation and coding improvement payment adjustment,” CMS states in the rule. “We note, however, that these payment adjustments are necessary to correct past overpayments due solely to documentation and coding improvements. We have already delayed implementation of the required prospective adjustment amount, and we proposed only a portion of the remaining required adjustment to allow hospitals time to adjust to future payment differences and to moderate the effect of this adjustment in any given year.”
When it comes to the recalibration of relative weights for MS-DRGs, there are winners and losers every year, according to Kennedy.
Kennedy is pleased with the DRG for autologous bone marrow transplant was split according to their CC/MCC status. “They took the MS-DRG 15 and split it up into two parts, MS-DRG 16 (with CC/MCC) and MS-DRG 17 (without CC/MCC),” he explains. “Since CMS demonstrated that patients with CC/MCC require more resources that those without, this split better allocates CMS funding for this procedure.”
Additionally, the final rule divides excisional debridement and skin grafting in skin conditions not involving endocrine, nutritional, or metabolic principal diagnoses. “We agree with the commenters that data support the creation of three new debridement MS-DRGs 570, 571, and 572 for skin debridement and the revision of MS-DRGs 573 through 578 to include skin grafts only,” CMS says in the final rule.
This is a good change and there’s good data analysis behind it, Kennedy says. And it provides for greater reimbursement for hospitals that do grafts, which is correct because they do take more resources, he adds.
CMS included a few notable updates to the list of CCs and MCCs for FY 2012.
For example, there is a new code for pancytopenia due to chemotherapy (code 284.11) as well as pancytopenia due to other drugs (code 284.12).
“To everybody’s surprise, these codes were designated as MCCs. There was an expectation that drug-induced pancytopenia would lose its MCC status because pancytopenia due to chemo used to code to aplastic anemia, a MCC,” Kennedy says. “This happened when the CDC implemented a code for chemotherapy-induced anemia, which used to be coded to aplastic anemia; it lost its CC status altogether! So I’m elated. Hospitals—especially cancer and pediatric hospitals—should be very grateful for this.”
Kennedy also says that comments such as those submitted by the Association of Clinical Documentation Improvement Specialists (ACDIS) played a role in ensuring the new code for brain death (code 348.82) became an MCC instead of the a CC, as CMS originally proposed.
“Similarly, code 294.21 (dementia unspecified with behavioral disturbance) wasn’t going to be a CC, but again because of commenters like ACDIS, CMS made it a CC.”
Shannon McCall, RHIA, CCS, CCS-P, CPC, CEMC, CPC-I, CCDS, director of HIM and coding at HCPro, Inc., in Danvers, MA, the parent company of HealthLeaders Media, also noted the exclusion that was removed related to pressure ulcer coding.
When pressure ulcer site codes (codes 707.00–707.09) are assigned as the principal diagnosis with an additional code for the stage of the pressure ulcer there was a CC/MCC exclusion that would not allow the stage III and stage IV codes (codes 707.23–707.24) to serve as an MCC, she says. This exclusion will be removed for FY 2012 recognizing the stage III and stage IV pressure ulcer stage codes as an MCC when the reason for the admission was the pressure ulcer (i.e., principal diagnosis), McCall says.
The new, revised, and deleted ICD-9-CM codes have been finalized for FY 2012. (A full listing of the changes is available on the CMS website.)
“They did add a fair number of codes after the proposed rule came out based on the March 2011 ICD-9 Coordination and Maintenance Committee meeting,” McCall says. “Some of the ones that were added were for added specificity, like for postoperative shock to identify whether it was cardiogenic or septic. All of these codes will be considered MCCs.”
CMS also added specificity to the complications associated with central catheter codes to identify whether an infection was considered a local infection due to a central venous catheter vs. a bloodstream infection due to a central venous catheter, McCall says.
There are additional codes for acute respiratory failure following surgery to identify whether it occurred in the presence of acute and chronic respiratory failures. “So they did have some added detail there, too,” McCall says.
CMS finalized more procedure codes than expected. “We thought we were only going to have one new procedure code this year, but they added almost 20 new procedure codes,” McCall says.
Additions include atherectomy codes (17.53–17.56), which were traditionally coded within the angioplasty series of codes, but those didn’t really reflect the true procedure being performed, she says, so CMS created specific codes to identify the atherectomies performed in the coronary and other vessels. This differentiation will be helpful in preparation for the transition to ICD-10-PCS because angioplasties and atherectomies will be considered different root operations in the new system so distinction will become increasingly important.
CMS also added endovascular and transapical heart valve codes as well as a code for the sleeve gastrectomy procedure, which can be performed either via open or laparoscopic approaches, McCall notes.
“[CMS] created code 43.82 specifically for a laparoscopic sleeve gastrectomy,” McCall says. “Previously, this procedure did not have a specific code, and was reported as 43.89, which is for an ‘other total gastrectomy’.” But when paired with a principal diagnosis of 278.01, code 43.89 wasn’t included as an inclusive procedure for DRGs for obesity so it fell into the DRGs 981–983 for extensive OR procedures unrelated to the principal diagnosis, “which doesn’t make any sense at all because in this instance the procedure was related to the principal diagnosis (i.e., obesity),” she says. Therefore CMS not only created the new code for the sleeve gastrectomy, but also added it to MS-DRGs 619–621, which are the DRGs assigned for OR procedures for obesity.
The Patient Protection and Affordable Care Act requires CMS to implement a program to reduce hospital readmissions for certain hospitals with excess readmissions for certain selected conditions beginning in FY 2013 for discharges on or after October 1, 2012.
The final rule finalizes readmissions measures for three conditions:
- · Acute myocardial infarction (i.e., heart attack)
- · Heart failure
- · Pneumonia
CMS also finalized its definition of readmission as “occurring when a patient is discharged from the applicable hospital and then is admitted to the same or another acute care hospital within a specified time period from the time of discharge from the index hospitalization.” The specified time period would be 30 days.
In addition, the rule describes the methodology CMS will use to calculate excess readmission rates.
CMS proposed adding a new condition to the list of hospital-acquired conditions (HAC) subject to reduced payment provisions under the IPPS—contrast-induced acute kidney injury. Although CMS acknowledged in the proposed rule that there are no unique codes to identify the varying stages of acute kidney injury, the agency proposed to identify it as a subset of discharges with ICD-9-CM diagnosis code 584.9 (acute kidney failure, unspecified), a CC. CMS contended that it could accurately identify contrast-induced kidney injury when code 584.9 is listed in combination with specified procedure codes from the 88.xx code series.
After considering public comments on this proposed new HAC, CMS has decided to defer adding contrast-induced acute kidney injury as an HAC until “such at time when improved coding is available,” according to the final rule.
“I’m grateful that they chose not to use acute renal failure as an HAC. The ICD-9 and ICD-10 coding systems aren’t robust enough to track contrast-induced nephropathy,” Kennedy says. “While the logic for using contrast induced renal failure is sound, the ICD-9-CM Coordination and Maintenance Committee will have to create codes to implement this policy.”
If that happens, CMS might choose to add this as an HAC in the future, he says, as CMS has stated it is an area of interest and it believes there is room for quality improvement in this area.
According to the final rule, CMS did adopt five new ICD-9-CM codes to be added to their respective HAC categories:
- Procedure codes 808.44 and 808.54 for multiple pelvic fractures are added to the falls and trauma category
- Procedure codes 539.01 and 539.81 for infections related to gastric procedures are added to the surgical site infection following certain bariatric procedures category
- Procedure code 415.13 describing a type of pulmonary embolus is added to the deep vein thrombosis and pulmonary embolism following certain orthopedic procedures category.
CMS continued to address comments about the three-day payment window in the final rule.
Specifically, commenters were looking for information on billing in relation to the three-day rule for free-standing physician offices, according to Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro. However, CMS basically indicated further information would be available in the upcoming Medicare Physician Fee Schedule that will be released this fall.
“People need to read very carefully the physician fee schedule final rule for further billing instructions on how to divide up the overhead piece vs. the professional piece,” Hoy says. “We know [the three-day rule] applies, but how? We were hoping for some sort of formula.”
Other commenters asked for clarification on what “clinically associated” really means, Hoy says, but CMS provided no clarification on that matter.
Hoy offers another interesting note: CMS indicated in the rule that providers shouldn’t assume that all services provided during a continuous stay are related.
“CMS seems to be saying that continuous stays are not necessarily related and could result in some bundling of unrelated services if you made that assumption,” Hoy says. “Though this could be a positive change in terms of reimbursement if you get payment for a few services that didn’t need to be bundled, it makes it all that much more confusing and operationally difficult to individually review all of the services.”
CMS has finalized the addition of the Medicare Spending per Beneficiary measure in 2014 to the Hospital Inpatient Value-Based Purchasing program required by the PPACA.
While the proposed rule indicated the measure would assess Medicare parts A and B spending from three days prior to an inpatient admission until 90 days after discharge, the finalized measure tracks spending from three days prior to admission until 30 days post-discharge.
“One new measure that’s outside what we’ve seen to date is the Medicare spending per beneficiary measure . . . CMS had originally proposed that it measure spending from three days pre-hospitalization through 90 days post-discharge, but as we requested, they shortened the time period to 30 days post-discharge,” Kim says. “It’s a new type of measure, a spending measure, which we haven’t seen before in the inpatient quality reporting program.”
In addition to hospitals paid under the IPPS, the rule also updates payment policies and rates for those under the long-term care hospital prospective payment system (LTCH PPS).
LTCHs finalizes an expected increase of $126 million (a net increase of 2.5%), due to a 1.8% rise in payment rates and other policies, compared to the proposed rule, which estimated a 1.9% increase.
A new pay-for-reporting program was also finalized in the rule for the following quality measures:
- · Catheter-associated urinary tract infection
- · Central line catheter-associated bloodstream infections
- · New or worsening pressure ulcers
The first measure set for reporting will take effect in October 2012, with a 2% payment penalty for non-reporting beginning in October 2013.
Editor’s note: The final rule will appear in the August 18 issue of the Federal Register. Changes are effective October 1, 2012 unless otherwise specified. For additional information, including IPPS and LTCH PPS tables, visit the CMS website.
Andrea Kraynak, CPC, is senior managing editor of Medical Records Briefing and HIM Connection. She may be reached at akraynak@hcpro.com.