IPPS FY 2021 Proposed Rule: MS-DRG Proposals
Providing Patients with Better Value and Results
At least annually, MS-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 first article in a series of article about the 2021 IPPS Proposed Rule. This week highlights proposed changes to specific MS-DRG Classifications.
Pre-MDC: Bone Marrow Transplants
Surgical vs. Medical MS-DRGs
Currently, the Bone Marrow Transplant (BMT) MS-DRGs (MS-DRG 014 (Allogeneic Bone Marrow Transplant), MS-DRG 016 (Autologous Bone Marrow Transplant with CC/MCC or T-Cell Immunotherapy), and MS-DRG 017 (Autologous Bone Marrow Transplant without CC/MCC) are designated as surgical MS-DRGs.
A request was made to re-designate these three MS-DRGs as medical MS-DRGs as a Bone Marrow Transplant does not involve a surgical procedure or require the use of an O.R. The requestor noted that this change “would clinically align with the resources utilized in the performance of these procedures.
CMS clinical advisors agreed and the proposal has been made to re-designate MS-DRGs 014, 016, and 017 as medical MS-DRGs effective October 1, 2020.
BMT Procedures Designation O.R. vs. Non-O.R.
The requestor also noted that MS-DRGs 016 and 017 includes ICD-10-PCS procedures codes designated as Non-O.R. while the following eight procedures are designated as O.R. Procedures:
- 30230AZ: Transfusion of embryonic stem cells into peripheral vein, open approach
- 30230G0: Transfusion of autologous bone marrow into peripheral vein, open approach
- 30230X0: Transfusion of autologous cord blood stem cells into peripheral vein, open approach
- 30230Y0: Transfusion of autologous hematopoietic stem cells into peripheral vein, open approach
- 30240AZ: Transfusion of embryonic stem cells into central vein, open approach
- 30240G0: Transfusion of autologous bone marrow into central vein, open approach
- 30240X0: Transfusion of autologous cord blood stem cells into central vein, open approach
- 30240Y0: Transfusion of autologous hematopoietic stem cells into central vein, open approach.
CMS is proposing to re-designate these codes from O.R. to Non-O.R. procedures effective October 1, 2020.
Chimeric Antigen Receptor (CAR) T-Cell Therapies: New MS-DRG
In the FY 2020 IPPS Proposed Rule, a request was made to create new MS-DRGs for CAR T-cell therapy. The requestor noted this would improve payment in the inpatient setting. CMS did not believe enough data was available to make a change at that time. However, CMS did seek comments on payment alternatives for CAR-T cell therapies.
In the FY 2020 Final Rule CMS finalized the continuation of the new technology status and add-on payments for FY 2020 for this therapy.
There were several requests made, in the FY 2021 proposed rule, to create a new MS-DRG as this therapy will no longer be eligible for the new technology add-on payment (NTAP) for FY 2021. CMS has responded by noting they now have enough data to consider the development of a new MS-DRG. Further, CMS clinical advisors found a vast discrepancy in resource consumption and clinical differences warranting the creation of new MS-DRG.
CMS is proposing to do the following:
- Create new MS-DRG 018 (Chimeric Antigen Receptor (CAR) T-cell immunotherapy, and
- Revise the MS-DRG 016 title to “Autologous Bone Marrow Transplant with CC/MCC.”
The following table highlights the proposed MS-DRG relative weight (RW) and geometric mean length of stay (GMLOS) for the BMT MS-DRGs and the proposed new CAR T-Cell MS-DRG:
|MS-DRG||MS-DRG Description||Proposed R.W.||Proposed GMLOS|
|014||Allogeneic Bone Marrow Transplant||12.7469||24.1|
|016||Autologous Bone Marrow Transplant with CC/MCC||6.7241||17.2|
|017||Autologous Bone Marrow Transplant without CC/MCC||4.8308||8.8|
|018||Chimeric Antigen Receptor (CAR) T-Cell Immunotherapy||37.1412||15.5|
|Table 5. – List of Medicare Severity Diagnosis-Related Groups (MS-DRGs), Relative Weighting Factors, and Geometric and Arithmetic Mean Length of Stay – FY 2021 Proposed Rule|
MDC 1: Diseases and Disorders of the Nervous System
Carotid Artery Stent Procedures: Background
In FY 2020 CMS finalized their proposal to reassign 96 ICD-10-PCS procedures describing dilation of carotid artery with an intraluminal device(s):
- From MS-DRGs 037, 038, and 039 (Extracranial Procedures with MCC, with CC, and without CC/MCC respectively)
- To MS-DRGs 034, 035, and 036 (Carotid Artery Stent Procedures with MCC, with CC, and without CC/MCC respectively)
Carotid Artery Stent Procedures: FY 2021 Proposals
In response to a request, CMS is proposing to reassign the following six ICD-10-PCS codes describing dilation of carotid artery with drug eluting intraluminal device(s) using an open approach from MS-DRGs 037, 038, and 039 to MS-DRGs 034, 035, and 036:
- 037H04Z: Dilation of right common carotid artery with drug-eluting intraluminal device, open approach
- 037J04Z: Dilation of left common carotid artery with drug-eluting intraluminal device, open approach
- 037K04Z: Dilation of right internal carotid artery with drug-eluting intraluminal device, open approach
- 037L04Z: Dilation of left internal carotid artery with drug-eluting intraluminal device, open approach
- 037M04Z: Dilation of right external carotid artery with drug-eluting intraluminal device, open approach
- 037N04Z: Dilation of left external carotid artery with drug-eluting intraluminal device, open approach
CMS further reviewed to see if any of the six codes were included in MS-DRGs outside of MDC 1. They found a total of 36 ICD-10 PCS codes for procedures describing dilation of the carotid artery with an intraluminal device with an open approach that are currently assigned to MS-DRG 252 (Other Vascular Procedures with MCC) in MDC 5 (Diseases and Disorders of the Circulatory System). Interestingly, they found 8 claims with one of these 36 ICD-10-PCS codes and a Principal Diagnosis in MDC 1 causing the claims to group to the Extensive O.R. Procedure Unrelated to Principal Diagnosis MS-DRG Group (981, 982, and 983).
CMS is proposing to add the 36 ICD-10-PCS codes currently in MDC 5 to the GROUPER logic for MS-DRGs 034, 035, 036 in MDC 1. As my instructor told me when first learning about the MS-DRG system, this change will permit cases with a Principal Diagnosis in MDC 1 to “remain in the family.”
MDC 3: Diseases and Disorders of Ear, Nose, and Throat
Temporomandibular Joint Replacements
A request was made to reassign ICD-10-PCS procedures 0RRC0JZ (Replacement of right temporomandibular joint with synthetic substitute, open approach), and 0RRD0JZ (Replacement of left temporomandibular joint with synthetic substitute, open approach):
- From MS-DRGs 133 and 134 (Other Ear, Nose, Mouth and Throat O.R. Procedures with and without CC/MCC, respectively)
- To MS-DRGs 131 and 132 (Cranial and Facial Procedures with and without CC/MCC, respectively) in MDC 03.
The requestor stated that it is inaccurate for these two codes that involve the excision of the TMJ and replacement with a prosthesis to Group to MS-DRGs 133 and 134 when the codes for the TMJ excision alone (0RBC0ZZ (Excision of right temporomandibular joint, open approach) and 0RBD0ZZ (Excision of left temporomandibular joint, open approach) group to the higher weighted MS-DRGs 131 and 132.
The requestor also recommended analysis of all procedures involving the mandible and maxilla and consider reassignment of these procedures codes describing procedure performed on facial and cranial structure:
- From MS-DRGs 129 (Major Head and Neck Procedures with CC/MCC or Major Device) and 130 (Major Head and Neck Procedures without CC/MCC)
- To MS-DRGs 131 and 132.
CMS undertook a comprehensive review of all procedures currently assigned to MS-DRGs 129, 130, 131, 132, 133, and 134. Based on data analysis and this comprehensive review, the Clinical Advisors support restructuring of these MS-DRGs by assigning procedures currently assigned to these MS-DRGs based on clinical intensity, complexity of service and resource utilization.
Additional Findings as a result of this comprehensive review included:
- CMS noting the current special logic defined as “Major Device Implant” for MS-DRG 129 that identified procedures describing the insertion of a cochlear implant or other hearing device. “Clinical advisors supported the removal of this special logic from the definition for assignment to any proposed modifications to the MSDRGs, noting the costs of the device have stabilized over time and the procedures can be appropriately grouped along with other procedures involving devices in any restructured proposed MS-DRGs.”
- CMS identified 338 procedure codes that were inadvertently assigned to MS-DRGs 133 and 134 as a result of replication during the transition from ICD-9 to ICD-10 based MS-DRGs. This list of codes is available in Table 6P.2c.
As a result of their review, CMS has proposed the following:
- Delete the three MS-DRGs groups with a two-way severity level subgroup (129 & 130, 131 & 132, and 133 & 134)
- Create two new base MS-DRGs with a three-way severity level split:
- MS-DRGs 140, 141, and 142 (Major head and Neck Procedures with MCC, with CC, without CC/MCC respectively), and
- MS-DRGs 143, 144, and 145 (Other Ear, Nose, Mouth, and Throat O.R. Procedures with MCC, with CC, without CC/MCC respectively).
MDC 5: Diseases and Disorders of the Circulatory System
Left Atrial Appendage Closure (LAAC)
Requests were made to create a new MS-DRG for the LAAC procedure or to map all LAAC procedures to a different MS-DRG with payment rates aligned with procedural costs. The following table shows the current corresponding MS-DRGs for the 9 ICD-10-PCS codes describing LAAC Procedures
|02L70CK||250-251||Occlusion of left atrial appendage with extraluminal device, open approach|
|02L70DK||250-251||Occlusion of left atrial appendage with intraluminal device, open approach|
|02L70ZK||250-251||Occlusion of left atrial appendage, open approach|
|02L73CK||273-274||Occlusion of left atrial appendage with extraluminal device, percutaneous approach|
|02L73DK||273-274||Occlusion of left atrial Appendage with intraluminal device, percutaneous approach|
|02L73ZK||273-274||Occlusion of left atrial appendage, percutaneous approach|
|02L74CK||273-274||Occlusion of left atrial appendage with extraluminal device, percutaneous endoscopic approach|
|02L74DK||273-274||Occlusion of left atrial appendage with intraluminal device, percutaneous endoscopic approach|
|02L74ZK||273-274||Occlusion of left atrial appendage, percutaneous endoscopic approach|
|Source: IPPS Proposed Rule for FY 2021|
As detailed in the table, ICD-10-PCS procedures currently map to an MS-DRG based on the approach. CMS has proposed to reassign the ICD-10-PCS procedure codes for an open approach to MS-DRGs 273 and 274. “Clinical advisors stated this reassignment would allow all LAAC procedures to be grouped to the same MS-DRGs and improve clinical coherence. The following table highlights the difference in R.W., GMLOS and national average payment in FY 2020:
|MS-DRG||MS-DRG Description||R.W.||GMLOS||National Payment Rate|
|250||Percutaneous Cardiovascular Procedure without Coronary Artery Stent with MCC||2.5501||3.7||$14,577.19|
|251||Percutaneous Cardiovascular Procedure without Coronary Artery Stent without MCC||1.6830||2.2||$9,620.57|
|273||Percutaneous Intracardiac Procedures with MCC||3.7103||4.5||$21,209.26|
|274||Percutaneous Intracardiac Procedures without MCC||3.1598||1.7||$18,062.43|
|Data Source: OPTUM 360° 2020 DRG Expert|
Potential Impact by the Numbers
With the national payment rate for MS-DRGs 273 and 274 being significantly higher than MS-DRG 250 and 251, I wanted to see what the potential volume of claims and payment impact this change might have. To answer these questions I pulled Medicare fee-for-service paid claims data from RealTime Medicare Data (RTMD). Specifically, all claims with one of the 9 ICD-10-PCS procedure codes for LAAC for Alabama, Georgia and Tennessee in Calendar Year (CY) 2019. Following is what I found “by the numbers:”
- 314: The number of LAAC procedures performed in CY 2019.
- 1: The volume of claims grouping to MS-DRG 250.
- 8: The volume of claims grouping to MS-DRG 251.
- $74,166.95: The increase in payment for this group of 9 MS-DRGs based on FY 2020 national average payment.
Insertion of Cardiac Contractility Modulation Device
A request was made to review the MS-DRG assignment for cases identifying patients receiving a cardiac contractility modulation (CCM) device system for CHF. “CCM is indicated for patients with moderate to severe heart failure resulting from either ischemic or non-ischemic cardiomyopathy. CCM utilizes electrical signals which are intended to enhance the strength of the heart and overall cardiac performance. CCM delivery device systems consist of a programmable implantable pulse generator (IPG) and three leads which are implanted in the heart. One lead is implanted into the right atrium and the other two leads are inserted into the right ventricle.”
Reasons for this request:
- MS-DRGs 222, 223, 224, 225, 226, and 227 (Cardiac Defibrillator Implant with and without Cardiac Catheterization with and without AMI/HF/Shock with and without MCC, respectively include “code pairs” describing the insertion of contractility modulation devices.
- Currently, GROUPER logic requires the combination of the CCM device codes and a left ventricular lead to map to this group of MS-DRGs.
- Per the requestor, a CCM device is contraindicated in patients with a left ventricular lead. Consequently, no case involving insertion of the CCM system can be appropriately mapped to this group of MS-DRGs.
- Currently, CCM system insertion maps to MS-DRG 245 (AICD Generator Procedures).
- Requester noted to date this procedure has been performed on an outpatient bases but expects that some Medicare patients will receive CCM devices as an inpatient.
CMS analysis found that the ICD-10-PCS procedure code combinations for right ventricular and/or right atrial lead insertion with insertion of CCM devices were inadvertently excludes from this group of MS-DRGs as a result of replicating the ICD-9 based MS-DRGs. Based on their analysis, CMS is making the following two proposals:
- Add 24 ICD-10-PCS code combinations for CCM devices to this group of MS-DRGs, and
- Delete the 12 clinically invalid code combinations from the GROUPER logic of this MS-DRG group describing the insertion of CCM device and the insertion of a cardiac lead into the left ventricle.
MDC 6: Diseases and Disorders of the Digestive System
A request was made to add K35.20 (Acute appendicitis with generalized peritonitis, without abscess) to the list of complicated Principal Diagnoses grouping to MS-DRGs 338, 339, and 340 (Appendectomy with Complicated Principal Diagnosis with MCC, with CC, without CC/MCC, respectively) so that all ruptured/perforated appendicitis codes in MDC 6 would groups to these MS-DRGs.
Clinical Advisors agreed that the “presence of an abscess would clinically determine whether a diagnosis of acute appendicitis would be considered a complicated principal diagnosis.” However, since K35.20 is “without an abscess,” CMS did not make a proposal to add K35.20 to this MS-DRG group.
The requestor had also noted that K35.32 (Acute appendicitis with perforation and localized peritonitis, without abscess) currently groups to MS-DRGs 338, 339, and 340. Subsequently, CMS identified all diagnosis codes describing acute appendicitis under subcategory K35.2 and K35.3 to review MS-DRG assignments for clinical coherence. As a result of this review, CMS is making the following proposals specific to diagnosis code K35.32:
- Reassign diagnosis code from MS-DRGs 338, 339 and 340 to MS-DRGs 341, 342, and 343; and
- Remove diagnosis code from the complicated principal diagnosis list in MS-DRGs 338, 339, and 340.
MDC 8: Diseases and Disorders of the Musculoskeletal System and Connective Tissue
Hip and Knee Joint Replacements
A requestor recommended restructuring MS-DRGs for total joint arthroplasty that utilize oxidized zirconium bearing surface implants in total hip and total knee replacements. They went on to offer three options for restructuring the MS-DRGs. Based this request and lengthy data analysis by CMS, CMS is proposing to create two new MS-DRGs for FY 2021:
- MS-DRG 521: Hip Replacement with Principal Diagnosis of Hip Fracture with MCC, and
- MS-DRG 522: Hip Replacement with Principal Diagnosis of Hip Fracture without MCC.
Request for Comment
CMS noted that the Comprehensive Care for Joint Replacement (CJR) model includes episodes triggered by MS-DRG 469 with hip fracture and MS-DRG 470 with hip fracture. Given the proposal for new MS-DRGs for hip fracture, CMS is seeking comments on the effect this proposal would have on the CJR model and whether to incorporate the new MS-DRGs into the model if finalized.
MDC 11: Diseases and Disorders of the Kidney and Urinary Tract
Currently, Kidney Transplants group to MS-DRG 652 (Kidney Transplant) in MDC 11. There was a request to designate kidney transplants as Pre-MDC MS-DRGs similar to other organ transplants. CMS analysis found that all kidney transplants in MS-DRGs 981 and 982 reported a principal diagnosis in MDC 5 (Diseases and Disorders of the Circulatory System). CMS is proposing an alternate option “to modify the GROUPER logic for MS-DRG 652 by allowing the presence of a procedure code describing transplantation of the kidney to determine the MS-DRG assignment independent of the MDC of the principal diagnosis in most instances.”
CMS goes on to discuss how the Pre-MDCs came into existence and that the proposal for kidney transplant represent a “first step in investigating” how they may consider shifting transplants out of Pre-MDCs as their clinical advisors have noted that while once considered as being very resource intensive, “treatment practices have shifted since the inception of Pre-MDCs.”
Kidney Transplants and Dialysis during an Inpatient Stay
An additional request was made to create a new MS-DRG for kidney transplant cases where a patient receives dialysis during the inpatient stay and after the date of the transplant. The following three ICD-10-PCS procedure codes identify the performance of hemodialysis:
- 5A1D70Z: Performance of urinary filtration, intermittent, less than 6 hours per day
- 5A1D80Z: Performance of urinary filtration, prolonged intermittent, 6-18 hours per day
- 5A1D90Z: Performance of urinary filtration, continuous, greater than 18 hours per day
CMS believes that creating separate MS-DRGs when hemodialysis is performed either before or after a kidney transplant or simultaneous pancreas/kidney transplant “would appropriately address the differential in resource consumption consistent with the President’s Executive Order on Advancing American Kidney Health (see https://www.whitehouse.gov/presidential-actions/executive-order-advancing-american-kidney-health/). CMS is proposing the following three new MS-DRGs:
- Proposed new Pre-MDC MS-DRG 019 (Simultaneous Pancreas/Kidney Transplant with Hemodialysis),
- CMS is proposing to add the procedure codes from current Pre-MDC MS-DRG 008 to the proposed new Pre-MDC MS-DRG 019 with the procedure codes describing a hemodialysis procedure.
- Proposed new MS-DRG 650 (Kidney Transplant with Hemodialysis with MCC) and
- Proposed new MS-DRG 651 (Kidney Transplant with Hemodialysis without MCC).
- Similarly, CMS is also proposing to add the procedure codes from current MS-DRG 652 to the proposed new MS-DRGs 650 and 651 with the procedure codes describing a hemodialysis procedure.
Hemodialysis procedure codes are currently “designated as Non-O.R. procedure, therefore, as part of the logic for these proposed new MS-DRGs, we are also proposing to designate these codes as non-O.R. procedures affecting the MS-DRG.”
Proposed Addition of Diagnoses to MS-DRGs 673, 674, and 675 (Other Kidney and Urinary Tract Procedure Logic
In response to a request, CMS reviewed the GROUPER logic for this MS-DRG group including the special logic for certain MDC 11 diagnoses reported with procedures codes for the insertion of tunneled or totally implantable vascular access devices. Based on their review, CMS is making several proposals for code reassignment to this MS-DRG group.
MDC 17: Myeloproliferative Diseases and Disorders, Poorly Differentiated Neoplasms
Inferior Vena Cava Filters
A requestor noted that currently when the procedure code describing the placement of an inferior vena cava (IVC) filter (06H03DZ – Insertion of intraluminal device into inferior vena cava, percutaneous approach) is also reported with the codes describing the introduction of a high dose chemotherapy agent or report a chemotherapy principal diagnosis with a secondary diagnosis describing acute leukemia, the cases are assigned to a lower weighted MS-DRG group than when the IVC filter code is not on the claim.
CMS notes in the proposed rule that “our clinical advisors believe that, given the similarity in factors such as complexity, resource utilization, and lack of a requirement for anesthesia administration between all procedures describing insertion of a device into the inferior vena cava, it would be more appropriate to designate these three ICD-10-PCS codes describing the insertion of an intraluminal device into the inferior vena cava as Non-O.R. procedures. Therefore, we are proposing to remove ICD-10-PCS procedure codes 06H00DZ, 06H03DZ, and 06H04DZ from the FY 2021 ICD-10 MS-DRG Version 38 Definitions Manual in Appendix E--Operating Room Procedures and Procedure Code/MS-DRG Index as O.R. procedures. Under this proposal, these procedures would no longer impact MS-DRG assignment.”
Review of Procedure Codes in MS-DRGS 981 through 983 and 987 through 989
Adding Procedures Codes Currently Grouping to MS-DRGS 981 – 983 and 987 – 989 into MDCs
Annually, CMS conducts a review of procedures resulting in assignment to the O.R. and non-extensive O.R. Procedures Unrelated to Principal Diagnosis MS-DRG Groups (981-983 and 987-989). This review is done on the basis of volume, by procedure, to see if it is more appropriate to move a procedure to a surgical MS-DRG for the MDC where the Principal Diagnosis falls.
There are several proposals being made to move diagnosis and procedures codes back into a specific MDC for FY 2021. For those interested, you can find these proposals on pages 32526 – 32542 of the Proposed Rule.
MMP strongly encourages key stakeholders at your facility take the time to review this proposed rule and submit comments. CMS is accepting comments through 5 p.m. EDT on July 10, 2020.
Article by Beth Cobb
Beth Cobb, RN, BSN, ACM, CCDS, is the Manager of Clinical Analytics at Medical Management Plus, Inc. Beth has over twenty-five years of experience in healthcare including eleven years in Case Management at a large multi-facility health system.
This material was compiled to share information. MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.