Knowledge Base Article

October 1st has seen its share of historical events. Before looking forward, let’s take a look back at a few highlights from this date in history.

October 1, 1800: Spain ceded Louisiana to France in a secret treaty.

October 1, 1851: First Hawaiian stamp is issued.

October 1, 1880: First electric lamp factory opened by Thomas Edison.

October 1, 1890: Yosemite National Park forms.

October 1, 1908: Ford puts the Model T car on the market at a price of US$825.

October 1, 1942: Little Golden Books (children books) begins publishing.

October 1, 1955: “Honeymooners” premieres.

October 1, 1982: Sony launches the first consumer compact disc player (model CDP-101).

October 1, 1989: U.S. issues a stamp, labeling an Apatosaurus as a brontosaurus.

October 1, 2013: U.S. federal government shuts down non-essential services after it is unable to pass a budget measure.

As we are now 29 days from October 1st, it appears that the transition to ICD-10 won’t be shut down. While ICD-10 is and should be a main focus for hospitals right now, a gentle reminder that October 1st is also the start of the Centers for Medicare and Medicaid Services (CMS) fiscal year and the implementation of the Fiscal Year (FY) 2016 Inpatient Prospective Payment System (IPPS) Final Rule. This article highlights some of the key MS-DRG changes finalized in the Inpatient Prospective Payment System (IPPS) 2016 Final Rule that will also begin on October 1, 2015.

Documentation and Coding Adjustment

CMS is required to recover $11 billion by 2017 to fully recoup documentation and coding overpayments related to the transition to the MS-DRG system that began in FY 2008. CMS finalized another -0.8 percent adjustment as begun in FY 2014 to continue the recoupment process.

Changes to Preventable Hospital Acquired Conditions (HACs), Including Infections for FY 2016

CMS finalized the proposal to implement the ICD-10-CM/PCS Version 33 HAC list to replace the ICD-9-CM Version 32 HAC list. The HAC code list translations from ICD-9-CM to ICD-10-CM/PCS are located in Appendix I of the ICD-10-CM/PCS MS-DRG Version 32 Definitions Manual that can be located in the Downloads section of the ICD-10 MS-DRG Conversion Project Web site at: https://www.cms.gov/Medicare/Coding/ICD10/ICD-10-MS-DRG-Conversion-Project.html

Finalized Changes to Specific MS-DRG Classifications for FY 2016

MDC 5: Diseases and Disorders of the Circulatory System

The CMS created 2 New MS-DRGs to classify Percutaneous Intracardiac Procedures.

Major Cardiovascular Procedures have been moved from MS-DRGs 237 and 238 to five new MS-DRGs as outlined in the following table.

‍MDC 8: Diseases and Disorders of the Musculoskeletal System and Connective Tissue

Revision of Hip or Knee Replacements ICD-10-PCS Version 32 Logic

The CMS finalized the proposal to add code combinations which capture the joint revision procedure. These combination codes will be the same for MS-DRGs 466,467, 468 as well as MS-DRGs 628, 629, and 630 (Other Endocrine, Nutritional, and Metabolic Operating Room Procedures with MCC, with CC, and without CC/MCC) as the joint procedures are also included in this MS-DRG group. The table of code combinations can be found on pages 49,390 thru 49,406 of the Final Rule.

Spinal Fusion

The CMS finalized the proposal to change the title of MS-DRGs 456, 457 and 458. They indicated that by changing the reference of “9+ Fusions” to “Extensive Fusions,” this more appropriately identifies the procedures classified under these groupings. The final title revisions are as follows:

• MS-DRG 456: Spinal Fusion Except Cervical with Spinal Curvature/Malignancy/Infection or Extensive Fusion with MCC,
• MS-DRG 457: Spinal Fusion Except Cervical with Spinal Curvature/Malignancy/Infection or Extensive Fusion with CC; and
• MS-DRG 458: Spinal Fusion Except Cervical with Spinal Curvature/Malignancy/Infection or Extensive Fusion without CC/MCC.

MDC 14: Pregnancy, Childbirth and the Puerperium

The CMS finalized the proposal to modify the logic for several ICD-10 procedure codes where the current logic did not result in the appropriate MS-DRG assignment. Specifically, the codes should not be designated as O.R. codes. Specific Codes where the logic was modified include:

• 3E0P7GC (Introduction of other therapeutic substance into female reproductive, via natural or artificial opening);
• 3E0P76Z (Introduction of nutritional substance into female reproductive, via natural or artificial opening);
• 3E0P77Z (Introduction of electrolytic and water balance substance into female reproductive, via natural or artificial opening);
• 3E0P7SF (Introduction of other gas into female reproductive, via natural or artificial opening);
• 3E0P83Z (Introduction of anti-inflammatory into female reproductive, via natural or artificial opening endoscopic);
• 3E0P86Z (Introduction of nutritional substance into female reproductive, via natural or artificial opening endoscopic);
• 3E0P87Z (Introduction of electrolytic and water balance substance into female reproductive, via natural or artificial opening endoscopic);
• 3E0P8GC (Introduction of other therapeutic substance into female reproductive, via natural or artificial opening endoscopic); and
• 3E0P8SF (Introduction of other gas into female reproductive, via natural or artificial opening endoscopic).

Finalized Changes to the Postacute Care Transfer MS-DRGs

Per the 2015 OPTUM DRG Expert, “CMS established a postacute care transfer policy effective October 1, 1998. The purpose of the IPPS postacute care transfer payment policy is to avoid providing an incentive for a hospital to transfer patients to another hospital early in the patient’s stay in order to minimize costs while still receiving the full DRG payment. The transfer policy adjusts the payments to approximate the reduced costs of transfer cases.”

The CMS finalized the proposal to update the list of MS-DRGs that are subject to the Postacute Care Transfer Policy to include:

• MS-DRG 273: Percutaneous Intracardiac Procedures with MCC; and
• MS-DRG 274: Percutaneous Intracardiac Procedures without MCC.

Note: MS-DRGs 273 and 274 met the criteria for the special payment methodology and therefore are also subject to the MS-DRG special payment methodology.

Please be aware that this article highlights some of the key changes. For those closely involved with coding in your facility be on the lookout for our Annual Fall Inpatient webinar.

In the meantime, the FY 2016 Final Rule can be accessed at http://www.gpo.gov/fdsys/pkg/FR-2015-08-17/pdf/2015-19049.pdf.