DRG 182/183 – Esophagitis, Gastroenteritis & Miscellaneous Digestive Disorders, age >17 with and without CC

Hospital Payment Monitoring Program (HPMP) Special Project

DRGs 182 and 183 (Esophagitis, Gastroenteritis & Miscellaneous Digestive Disorders, age >17 with and without CC) were the focus of AFMC’s 7 th Scope of Work HPMP project. The project began in January 2004, with the primary objective of identifying areas where improvement interventions regarding unnecessary admissions and incorrect DRG assignments are needed. Analysis of the results of AFMC’s mandatory review under the Payment Error Prevention Program (PEPP) and the Hospital Payment Monitoring Program (HPMP) showed that cases paid under these DRGs have a significant potential for admission and DRG errors. Because of this, the focus of the DRG 182/183 Project was on both unnecessary admissions and incorrect DRG assignments. All Arkansas acute care Inpatient Prospective Payment System (IPPS) hospitals were included in the project.

Hospitals were advised to prepare for the project by:

• Including cases grouped to DRGs 182 and 183 in hospital internal medical necessity audits and hospital internal DRG audits.
• Referring cases that do not meet hospital inpatient admission criteria to the hospital utilization review committee.
• Initiating education where indicated by audit findings.
• Documenting all internal audit findings and actions taken as a result of those findings.
• Including internal audit findings and actions taken in any required quality improvement plan.
• Conducting internal DRG audits to ensure that each billed principal diagnosis is supported by chart documentation, and to ensure that all billed secondary diagnoses are conditions that affected the care of the patient in terms of requiring clinical evaluation, therapeutic treatment, diagnostic procedures, an extended length of stay, or increased nursing care and/or monitoring.

Baseline Study:

The initial (baseline) study was completed in June 2004, and statewide and hospital-specific study results were sent to all IPPS hospitals at that time. Hospital stays discharged during fiscal year 2002 were included in the baseline study. The case selection consisted of a random sample of cases paid under DRGs182 and 183 with a less than 3-day length of stay, and a random sample of cases paid under DRG 182 that were billed with a single secondary diagnosis that is considered to be a complication or co-morbidity (CC) for that admission. Payment adjustments were made on all identified payment errors. Hospitals with an admission denial rate of 10% or higher and/or a DRG error rate of 10% or higher were asked to develop and implement improvement interventions by August 1, 2004, to correct these errors.

Remeasurement Study:

The project remeasurement began in January 2005 and included cases discharged after the hospital quality improvement plans were implemented (hospital stays discharged during August and September, 2004). Cases were selected using the same case selection criteria as that used in the baseline study. Payment adjustments were made on all identified payment errors. Statewide and hospital-specific remeasurement results were sent to all IPPS hospitals in June 2005.

Final Project Results:

The remeasurement study showed an overall statewide reduction in unnecessary admissions from the baseline error rate of 31.67% to the remeasurement error rate of 22.56%. The statewide DRG error rate improved from 19.77% on the baseline to 16.54% on the remeasurement. Hospitals that did not show improvement in unnecessary admissions and/or DRG errors on the remeasurement study were asked to reevaluate their DRG 182/183 quality improvement plans and identify the areas where additional focus is needed to correct continued problems. While overall statewide improvement was demonstrated, these remeasurement error rates are still too high. Because of this, AFMC will propose to include DRGs 182 and 183 as part of our upcoming HPMP 8 th Scope of Work project.

Recommendations Resulting from Project Findings:

Under the Conditions of Participation, physicians are required to provide a final diagnostic statement on each Medicare discharge, and hospitals are required to accurately code and bill the diagnoses, as assigned by the physician. Many payment errors (overpayments and underpayments) occur because cases are billed before the physician has documented the final diagnostic statement. Because of this, AFMC strongly suggests that hospitals adopt a policy of not billing records until they are complete.

Hospitals should also work to ensure that communication lines between the coding staff and the medical staff are open. Medicare discharges can only be billed correctly if physicians know and understand the Medicare requirements with regard to the “principal” diagnosis and the appropriate reporting of additional (secondary) diagnoses. To assist hospitals in any physician documentation educational efforts they may undertake, AFMC’s “Physician Documentation and Inpatient Prospective Payment System (IPPS) Reimbursement” manual/course is available free of charge. Physicians who read the manual and successfully complete the post-test will be awarded 2.50 continuing medical education hours. The manual will give physicians a basic understanding of the financial importance of complete physician documentation. The manual may be ordered by calling Tori Gammill at 479-649-8501, ext. 7736, or it can be downloaded and printed from this web site (see Continuing Education under Resources).

Contact Person:

If you have any questions regarding this special project please call Karen Gabel, HPMP Manager, at 479-649-8501, extension 7714.