Knowledge Base Category -

Medicare Transmittals & MLN Articles

August 28, 2023: MLN MM13350: Changes to the Laboratory National Coverage Determination Edit Software: January 2024 Update

Billing staff need to know about newly available codes, recent coding changes, and how to find NCD coding information. CMS noted that there are no policy changes in this ICD-10 quarterly update. Instead, they follow the current, longstanding NCD process to implement policy changes. https://www.cms.gov/files/document/mm13350-changes-laboratory-national-coverage-determination-edit-software-january-2024-update.pdf

August 28, 2023: MLN MM13335: Inpatient Psychiatric Facilities Prospective Payment System: FY 2025 Updates

This article discusses changes for FY 2024 that are effective October 1, 2023. Make sure your billing staff knows about FY 2024 market basket update, wage index update, and changes to the Inpatient Psychiatric Facility (IPF) Quality Reporting Program (IPFQRP). https://www.cms.gov/files/document/mm13335-inpatient-psychiatric-facilities-prospective-payment-system-fy-2024-updates.pdf

August 31, 2023: MLN MM13353: Ambulatory Surgical Payment System: October 2023 Update

CMS advises in this MLN article that you make sure your billing staff knows about the new HCPCS code for renal/kidney histotripsy, the new drugs and biological codes, and the new skin substitute HCPCS codes. https://www.cms.gov/files/document/mm13353-ambulatory-surgical-center-payment-system-october-2023-update.pdf

September 6, 2023: MLN MM13340: Hospital Outpatient Prospective Payment System: October 2023 Update

This article highlights new COVID-19 CPT vaccines and administration codes, proprietary laboratory analyses (PLA) coding changes, multianalyte assays with algorithmic analyses (MAAA) CPT coding change, advanced diagnostics tests (ADLTs) under the clinical lab fee schedule (CLFS) and HCPCS code changes. https://www.cms.gov/files/document/mm13340-hospital-outpatient-prospective-payment-system-october-2023-update.pdf

September 6, 2023: MLN MM13343: DMEPOS Fee Schedule: October 2023 Quarterly Update

Make sure your billing staff knows about fee schedule adjustment relief for rural and non-contiguous areas, new HCPCS codes added, and new fee schedule amounts. https://www.cms.gov/files/document/mm13343-dmepos-fee-schedule-october-2023-quarterly-update.pdf

September 12, 2023: MLN MM11262: Limitation on Recoupment of Overpayments

This article reviews how Medicare recoups overpayments and how appeals and reconsiderations affect the recoupment process. https://www.cms.gov/files/document/mm11262-limitation-recoupment-overpayments.pdf

September 14, 2023: MLN MM13306: Inpatient & Long-Term Care Hospital Prospective Payment System: FY 2024 Changes

Highlights of policy changes for FY 2024 are included in this MLN article. Of note, CMS indicates that for FY 2024, hospitals have until late-September to notify them of any errors in the calculation of their Total Hospital Acquired Conditions (HAC) Reduction Program score. For this reason, the list of hospitals subject to the HAC Reduction Program will not be available by October 1, 2023. They note that “until we issue a final list of hospitals that are subject to the HAC Reduction Program for FY 2024, MACs will hold hospital claims. We anticipate issuing the list on or about October 3, 2023.” https://www.cms.gov/files/document/mm13306-inpatient-long-term-care-hospital-prospective-payment-system-fy-2024-changes.pdf

September 19, 2023: MLN MM13166: ICD-10 & Other Coding Revisions to National Coverage Determinations: October 2023 Update

Relevant NCD coding changes in related Change Request 13166 include:

• NCD 20.20: External Counterpulsation Therapy (ECP) for Severe Angina, effective August 7, 2023,
• NCD 90.2: Next Generation Sequencing (NGS), effective August 7, 2023, and
• NCD 210.1: Prostate Screening Tests, effective October 1, 2023.

We are mid-way through a week of celebrating Clinical Documentation Integrity Specialists. This year marks the 13^th annual Clinical Documentation Integrity (CDI) Week. The Association of Clinical Documentation Integrity Specialists (ACDIS) theme for 2023 is CDI Success Stories: Writing your next chapter!

Like the detective in a good who done it book, CDI specialists review records to make sure all the key elements are in a patient’s “story.” They look for clues (clinical indicators) without a documented diagnosis and documentation without supporting clues and then work with physicians to make sure the record reflects the patient’s complete story.

MMP would like to wish all the hard-working CDI Professionals that we have the privilege to work with a happy CDI week. To help you prepare for the new CMS fiscal year, while celebrating this week, here are links to key documentation needed for a successful October 1^st start of the 2024 CMS fiscal year.   

FY 2024 IPPS Final Rule Home Page

On this webpage you will find links to:

• The FY 2024 IPPS Final Rule,
• FY 2024 Final Rule Tables
• Table 5: MS-DRGs, Relative Weighting Factors, Geometric and Arithmetic Mean Lengths of Stay, and Post-Acute Transfer designated MS-DRGs
• Table 6: New Diagnosis Codes,
• Table 6B: New Procedure Codes
• Table 6I: Complete MCC List,
• Table 6I.1: Additions to the MCC List,
• Table 6I.2: Deletions to the MCC List,
• Table 6J: Complete CC list,
• Table 6J.1: Additions to the CC list,
• Table 6J.2: Deletions to the CC list
• FY 2024 MAC Implementation Files
• MAC Implementation File 7: FY 2024 MS-DRGs Subject to the Replaced Devices Policy,
• MAC Implementation File 8: FY 2024 New Technology Add-on Payment

(https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page)

2024 ICD-10-CM Files.)

Downloads available on this webpage includes:

• 2024 POA Exempt Codes,
• 2024 Conversion Table,
• 2024 Addendum – UPDATED 6/29/2023,
• 2024 Code Description in Tabular Order – UPDATE 6/29/2023,
• 2024 Code Tables, Tabular and Index UPDATED 6/29/2023,
• FY 2024 ICD-10-CM Coding Guidelines, and
• 2024 Errata – July 26, 2023.

(https://www.cms.gov/medicare/coding-billing/icd-10-codes/2024-icd-10-cm#:~:text=The%202024%20ICD%2D10%2DCM,2023%20through%20September%2030%2C%202024)

The ICD-10-Files are also available on the CDC’s Comprehensive Listing ICD-10-CM Files webpage (https://www.cdc.gov/nchs/icd/Comprehensive-Listing-of-ICD-10-CM-Files.htm).

2023 ICD-10-PCS Files

Downloads available on this webpage includes:

• 2024 ICD-10-PCS Order File,
• 2024 Official ICD-10-PCS Coding Guidelines,
• 2024 Version Update Summary,
• 2024 ICD-10-PCS Codes File,
• 2024 ICD-10-PCS Conversion table,
• 2024 ICD-10-PCS Code Tables and Index, and
• 2023 ICD-10-PCS Addendum.

(https://www.cms.gov/medicare/coding-billing/icd-10-codes/2024-icd-10-pcs)

Again, happy CDI week from our team to yours.

“The primary objective of the IPPS and the LTCH PPS is to create incentives for hospitals to operate efficiently and minimize unnecessary costs, while at the same time ensuring that payments are sufficient to adequately compensate hospitals for their legitimate costs in delivering necessary care to Medicare beneficiaries.”

• Source: Appendix A: Economic Analysis of FY 2024 IPPS Final Rule

There are eighteen days until the October 1^st start to the 2024 CMS Fiscal Year. As you continue to prepare, this article focuses on New Technologies Add-On Payments (NTAPs). Section E. Add-On Payments for New Services and Technologies for FY 2024 begins on page 58,793 of the FY 2024 IPPS Final Rule.

New Technologies Eligible for Add-On Payment (NTAPs) Background

Section 1886(d)(5)(K)(i) of the Act requires the Secretary to establish a mechanism to recognize the costs of new medical services and technologies under the payment system under the subsection which establishes the system for paying for the operating costs of inpatient hospital services.

The system of payment for capital costs is established in section 1886(g) of the Act. For this reason, capital costs are not included in the add-on payments for a new medical service or technology.  

NTAPs are not budget neutral and the “newness” for payment is limited to the 2-to-3-year period after the date a technology becomes available.

In response to the COVID-19 public health emergency (PHE) and as new therapies received approval to treat COVID-19, CMS established the New COVID-19 Treatments Add-on Payment (NCTAP). With the PHE ending in May of this year, the add-on payments for NCTAPs will end September 30, 2023.

There are three pathways for a new service or technology to be approved for the add-on payment (Traditional pathway, Certain Antimicrobial Products Alternative Pathway, and Certain Transformative New Devices Alternative Pathway).

For the alternative pathways, a technology is not required to have a specified FDA designation at the time the application for NTAP is made. Instead, “CMS reviews the application based on the information provided by the applicant only under the alternative pathway specified by the applicant at the time of new technology add-on payment application submission. However, to receive approval for the new technology add-on payment under that alternative pathway, the technology must have the applicable FDA designation and meet all other requirements in the regulations in § 412.87(c) and (d), as applicable.”

Coding NTAPs

Section X New Technology was added to ICD-10-PCS effective October 1, 2015. CMS has indicated (https://www.cms.gov/Medicare/Coding/ICD10/Downloads/2016-Section-X-New-Technology-.pdf) that “Section X was created in response to public comments received regarding New Technology proposals presented at ICD-10 Coordination and Maintenance Committee Meetings, and general issues facing classification of new technology procedures.”  To receive payment for an eligible NTAP, the applicable section X New Technology ICD-10-PCS code must be on the claim submitted for adjudication.

NTAPs by the Numbers

Before looking ahead to FY 2024, I wanted to see what new technologies have been coded in FY 2023 claims with dates of service from October 1, 2022 through March 31, 2023. The following claims volume was provided by our sister company RealTime Medicare Data (RTMD), represents claims volume for the entire nation, and is specific to the Medicare Fee-for-Service population.   

FY 2023

25: The number of technologies eligible for add-on payment.

94,210: The number of claims with dates of service from October 1, 2022 through March 2023 that included an ICD-10-PCS code eligible for add-on payment.

7,551: The number of claims with an ICD-10-PCS new technology code when the technologies eligible for the COVID-19 Treatments Add-On Payment (NCTAP) (convalescent plasma, Olumiant, and Veklury® (remdesivir)) were excluded from the claims volume. 

FY 2024

33: The number of technologies eligible for add-on payment.

58,524.5: The number of Medicare beneficiaries that CMS expects will receive one of the new technologies. Note, the .5 is not an error. CMS’ estimated cases for the NTAP Livtencity™ is 129.5 cases.

$495,497,861.97: CMS’ estimated Medicare spending on NTAPs in FY 2024.

Moving Forward

Identifying and coding new technologies is an opportunity not to be missed for those hospitals providing these services. That said, some questions come to mind for you to think about:

• Is your hospital providing any of these services or technologies?
• Who needs to be aware of what the new technologies are? (i.e., Physicians, Pharmacy, Coding Professionals, Clinical Documentation Integrity Specialists, Case Managers)
• What process do you have in place to alert your Coding Staff of the need to code the new technology ICD-10-PCS codes?

Resource

FY 2024 IPPS CMS webpage: https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page

We have a couple of questions regarding the coding of hyperlipidemia with hypercholesterolemia.

Question#1

If a provider has documented mixed hyperlipidemia and hypercholesterolemia in the record, do you code both conditions?

Answer#1

Only assign code E78.2 for mixed hyperlipidemia.  Pure hypercholesterolemia, unspecified (E78.00) is included with code E78.2 so it is not coded separately. 

Effective date:  June 9, 2023

Question#2

How do you code unspecified hyperlipidemia and hypercholesterolemia?

Answer#2

In this case, only the code for pure hypercholesterolemia, unspecified (E78.00) is assigned.  Hyperlipidemia, unspecified (E78.5) is not coded separately since hypercholesterolemia identifies the specific blood lipid elevated.

Effective date:  June 3, 2022

Hypercholesterolemia is defined as a high blood cholesterol level.

Hyperlipidemia is defined as high lipid or fat levels in the blood. 

References:

ICD-10-CM Official Coding Book

Coding Clinic for ICD-10-CM/PCS, Second Quarter 2023, Page 9

August 10, 2023: New Place of Service Code 27 – Outreach Site/Street

CMS published Change Request (CR) 13314 to inform providers about the new Place of Service (POS) code 27 for “Outreach Site/Street” – a non-permanent location on the street or found environment, not described by any other POS code, where health professionals provide preventive, screening, diagnostic, and/or treatment services to unsheltered homeless individuals. This code becomes effective on October 1, 2023.

In the August 25^th MLN connects e-newsletter, CMS noted “at this time, Medicare won’t use this code in claims processing. If you submit a claim with this code, we’ll return it to you.”

https://www.cms.gov/outreach-and-education/outreach/ffsprovpartprog/provider-partnership-email-archive/795634753/2023-08-24-mlnc#_Toc143610547

August 10, 2023: Review Choice Demonstration for Inpatient Rehabilitation Facility Services FAQs

On May 15, 2023, CMS announced the new initiative, The Review Choice Demonstration (RCD) for Inpatient Rehabilitation Facility (IRF) Services. This demonstration started in Alabama with the first cycle of review dates being August 21, 2023 through February 29, 2024.

Palmetto GBA Jurisdiction J is the Medicare Administrative Contractor for Alabama, and they have a dedicated webpage specific to this demonstration (https://palmettogba.com/palmetto/jja.nsf/DID/FHT2JV6UCF). On August 28^th, they posted a link to FAQs. Topics covered in this document include general questions, choice selection questions, submission questions, pre-claim review (PCR) questions, and medical necessity questions.

For IRF Providers outside of Alabama, I encourage you to pay close attention to the general question 4 asking what states does this demonstration impact.

CMS notes the demonstration initially for providers physically located in the state of Alabama and bill to MAC Jurisdiction J. The demonstration will then expand to Pennsylvania, Texas, and California, “as well as any state that bill to the MAC jurisdictions JJ, JL, JH, and JE, regardless of where they are physically located.”

Here is one example included in the answer to question 4:

I am an IRF located in a demonstration state but bill to a different MAC than the one for that state.

“You are included in the demonstration if the MAC that you bill to is JJ, JE, JL, or JH. If you bill to another MAC, then you are not included in the demonstration.”

You can find additional information about this demonstration on the CMS website at https://www.cms.gov/research-statistics-data-systems/medicare-fee-service-compliance-programs/prior-authorization-and-pre-claim-review-initiatives/review-choice-demonstration-inpatient-rehabilitation-facility-services#timeline.

August 21, 2023: CMS Issues Draft Guidance on New Program to Allow People with Traditional Medicare Fee-for-Service to Pay Out-of-Pocket Prescription Drug Costs in Monthly Payments

The Inflation Reduction Act of 2022 was signed into law on August 16, 2022. This law caps annual out-of-pocket prescription drug costs at $2,000 for 2025.

In addition to capping the out-of-pocket amount, the law gives people with Medicare prescription drug coverage (Medicare Part D) the option to make monthly payments spread over the year, also starting in 2025. On August 21^st, CMS published draft guidance for comment outlining the requirements and procedures for spreading out the cost sharing over the year.

Due to the size of the new program, CMS indicated they would release the guidance in two parts. Part one was released August 21^st and focuses on “helping Medicare Part D plan sponsors and pharmacies prepare for the new programs and build necessary infrastructure for successful implementation.” CMS is soliciting comments on topics and strategies included in the guidance to ensure eligible Part D enrollees benefit from the programs.

You can submit comments to CMS on the first draft guidance through September 30, 2023.

The planned release date for part two of the guidance will be in early 2024. This second release will focus on Medicare Part D enrollee outreach and education, Medicare Part D plan bid information, monitoring and compliance. “CMS also intends to develop tools, such as calculators, to help people with Medicare Part D and their caregivers learn what monthly payments may look like under the new program.”

Links to a Fact Sheet about the Medicare Prescription Payment Plan, an implementation timeline, and the August 21^st draft guidance are included in an August 21^st CMS Press Release. https://www.cms.gov/newsroom/press-releases/cms-issues-draft-guidance-new-program-allow-people-medicare-pay-out-pocket-prescription-drug-costs

July 21, 2023: MLN MM13240: Patient Driven Payment Model Claim Edits

CMS advises that Skilled Nursing Facilities (SNFs) and Hospitals need to make sure your billing staff knows about edits for SNFs billing on Type of Bill (TOB) 21X and Swing Bed TOB 18X, and hospitals billing during an interrupted stay. https://www.cms.gov/files/document/mm13240-patient-driven-payment-model-claim-edits.pdf

July 21, 2023: MLN MM13248: Processing Services During Disenrollment from the Program of All-Inclusive Care for the Elderly (PACE)

Hospitals, SNFs and other providers billing Medicare Administrative Contractors (MACs) for inpatient services they provide to PACE-eligible Medicare patients need to make sure your billing staff knows how CMS handles payment for Medicare patients disenrolling from PACE and condition codes and value code (VC) CMS requires to prevent claims denials. https://www.cms.gov/files/document/mm13248-processing-services-during-disenrollment-program-all-inclusive-care-elderly.pdf

July 27, 2023: MLN MM13275: ESRD Prospective Payment System: October 2023 Update

Make sure your billing staff knows about billing J0889 for daprodustat and new ICD-10-CM codes for comorbidity payment adjustment and acute kidney injury. https://www.cms.gov/files/document/mm13275-esrd-prospective-payment-system-october-2023-update.pdf

Augst 3, 2032: MLN MM13299: HCPCS Codes Used for Skilled Nursing Facility (SNF) Consolidated Billing (CB) Enforcement: October 2023 Update

Make sure billing staff knows about updates to the lists of HCPCS codes that are subject to the CB provision of the SNF prospective payment system (PPS), and additions and deletions of certain chemotherapy, blood clotting factors, and therapies inclusion codes from the Medicare Part A SNF files. https://www.cms.gov/files/document/mm13299-hcpcs-codes-used-skilled-nursing-facility-consolidated-billing-enforcement-october-2023.pdf

August 10, 2023: MLN MM13289: Hospice Payments: FY 2024 Update

This article provides information about payment rates, inpatient and aggregate caps and wage index update effective October 1, 2023 for hospices and providers billing for hospice services. https://www.cms.gov/files/document/mm13289-hospice-payments-fy-2024-update.pdf

August 16, 2023: SE19007 Revised: Activation of Validation Edits for Providers with Multiple Service Locations

This special edition MLN article was originally published on March 26, 2019 and recently updated for the fifth time on August 16^th. CMS has added information about the practice location address screen for round 3 testing Substantive changes are in dark red on pages 3 and 4.

Effective August 1, 2023, CMS started deploying the systematic validation edits requirements in Section 170 of the Medicare Claims Processing Manual, Chapter 1. MACs have been told to develop implementation plans to permanently turn on the Reason Codes and set them up to RTP claims that don’t exactly match.

CMS notes in the MLN article that they “expect that the almost 7-year time frame that the edits haven’t been active gave you ample time to validate your claims submission system and the PECOS information for your off-campus provider departments are exact matches.” https://www.cms.gov/outreach-and-education/medicare-learning-network-mln/mlnmattersarticles/downloads/se19007.pdf

August 17, 2023: MLN MM13321: Clinical Laboratory Fee Schedule & Laboratory Services Reasonable Charge Payment: Quarterly Update

Make sure your billing staff know about private payor data reporting (you must report data between January – March 2024), general specimen collection fee increase, and new and deleted HCPCS codes. https://www.cms.gov/files/document/mm13321-clinical-laboratory-fee-schedule-laboratory-services-reasonable-charge-payment-quarterly.pdf

August 24, 2023: Transmittal 12222: Inpatient Psychiatric Facilities Prospective Payment System Updates for Fiscal Year 2024

This Change Request (CR) 13335 identifies changes that are required as part of the annual IPF PPS update and applicable to discharges occurring from October 1, 2023 through September 30, 2024. https://www.cms.gov/files/document/r12222cp.pdf

Did You Know?

It has been almost two years since the October 2021 release of the CMS Change Request (CR) 12471 (https://www.cms.gov/files/document/R11059CP.pdf). There were two stated purposes for this CR noted in the Summary of Changes: 

• Implement system changes needed to update the Shared System Maintainer (SSM) interface with the Java MCE to accept new MCE Edit 20-Unspecific Code Edit, and
• Provide a mechanism to systematically bypass the new edit when a specific billing note is present in the claim remarks field to indicate the primary reason why laterality could not be determined.

Why this Matters?

In ICD-10-CM there are unspecified codes for when documentation in the record does not provide detail needed to report a more specific code. “However, in the inpatient setting, there should generally be very limited and rare circumstances for which the laterality (right, left, bilateral) of a condition is unable to be documented and reported.”

Effective for claims with dates of service on or after April 1, 2022, new Code Edit 20- will be triggered when an unspecified diagnosis code currently designated as either a Complication or Comorbidity (CC) or Major Complication or Comorbidity (MCC), that includes other codes in that code subcategory that further specify the anatomic site, is entered.

You will find the initial complete list of 3,432 ICD-10-CM unspecified codes subject to this edit in table 6P.3a associated with the FY 2022 IPPS/LTCH Final Rule (https://www.cms.gov/medicare/acute-inpatient-pps/fy-2022-ipps-final-rule-home-page).

This edit is meant to signal providers that there is a more specific laterality code available to report. It will be the provider’s responsibility to determine if documentation in the medical record supports a more specific code. “If, upon review, additional information to identify the laterality from the available medical record documentation by any other clinical provider is unable to be obtained or there is documentation in the record that the physician is clinically unable to determine the laterality because of the nature of the disease/condition, then the provider must enter that information in the remarks section.”

Mechanism to Bypass new MCE Edit 20-

The provider may enter a remark:

• Either “UNABLE TO DET LAT 1” to indicate that they are unable to obtain additional information to specify laterality, or
• “UNABLE TO DET LAT 2” to indicate the physician is clinically unable to determine laterality. 

Entering this language will enable your MAC to systematically bypass the edit and process your claim.

However, “if there is no language entered into the remarks section as to the availability of additional information to specific laterality and the provider submits the claim for processing, the claim would be returned to the provider.”

New Unspecified Codes Subject to MCE Edit 20-

In the FY 2024 IPPS Final Rule, CMS finalized the addition of six new diagnosis codes that are designated as a CC to the Unspecified code edit code list and four diagnosis codes that were inadvertently omitted from the Unspecified code edit list effective with discharges on or after April 1, 2022.

New FY 2024 Unspecified ICD-10-CM Diagnosis Codes

1. M80.0B9A: Age-related osteoporosis with current pathological fracture, unspecified pelvis, initial encounter for fracture
2. M80.0B9K: Age-related osteoporosis with current pathological fracture, unspecified pelvis, subsequent encounter for fracture with nonunion
3. M80.0B9P: Age-related osteoporosis with current pathological fracture, unspecified pelvis, subsequent encounter for fracture with malunion
4. M80.8B9A: Other osteoporosis with current pathological fracture, unspecified pelvis, initial encounter for fracture
5. M80.8B9K: Other osteoporosis with current pathological fracture, unspecified pelvis, subsequent encounter for fracture with nonunion
6. M80.8B9P: Other osteoporosis with current pathological fracture, unspecified pelvis, subsequent encounter for fracture with malunion
7. L89.103: Pressure ulcer of unspecified part of back, stage 3
8. L89.104: Pressure ulcer of unspecified part of back, stage 4
9. L89.93: Pressure ulcer of unspecified site, stage 3
10. L89.94: Pressure ulcer of unspecified site, stage 4

What Can You Do?

CMS finalized several changes to the Major Diagnostic Category (MDC) 05: Diseases and Disorders of the Circulatory System for FY 2024. This article focuses on the finalized changes in MDC 5. You can read about finalized changes in other MDCs in a related article in this week’s newsletter.

Surgical Ablation

A request was made for CMS to review the MS-DRG assignment of cases involving open concomitant surgical ablation procedures, recommending that open concomitant surgical ablation procedures for atrial fibrillation (AF) be reassigned from MS-DRGs 219, 220, and 221 (Cardiac Valve and Other Major Cardiothoracic Procedures without Cardiac Catheterization with MCC, with CC, and without CC/MCC, respectively) to MS-DRGs 216, 217, and 218 or create new MS-DRGs for all open mitral or aortic valve repair or replacement procedures with concomitant surgical ablation of AF.

Analysis showed that these cases require greater resources, have higher average costs and generally longer lengths of stay compared to all other cases in their assigned MS-DRG. Based on this analysis, CMS finalized their proposal to create a new base MS-DRG 212 (Concomitant Aortic and Mitral Valve Procedures) for cases reporting an aortic valve repair or replacement procedure, a mitral valve repair or replacement procedure, and another concomitant procedure in MDC 05.

In response to comments that the logic intent for assignment to new MS-DRG 212 was not clear. CMS clarified that cases reporting: (1) aortic valve repair or replacement procedure; (2) a mitral valve repair or replacement procedure; and (3) at least one other concomitant procedure, as defined in the GROUPER logic, would be assigned to new MS-DRG 212.

External Heart Assist Device

Currently, the three ICD-10-PCS procedure codes describing the insertion of a short-term heart assist device are recognized as extensive O.R. procedures assigned to MS-DRG 215 (Other Heart Assist System Implant) in MDC-05. Procedure code 02HA0RZ (Insertion of short-term external heart assist system into heart, open approach) describes an open approach. The other two procedure codes describe a percutaneous approach.

CMS has finalized their proposal to reassign the open approach procedure code when reported as a standalone procedure from MS-DRG 215 in MDC-05 to Pre-MDC MS-DRGs 001 and 002. Effective October 1, 2023, procedure code 02HA0RZ code will no longer need to be reported as a part of a procedure code combination or procedure code “cluster” to satisfy the logic assignment for MS-DRGs 001 and 002.

Ultrasound Accelerated Thrombolysis (UAST) for Deep Vein Thrombosis

A request was made to reassign cases reporting USAT of peripheral vascular structures procedures with the administration of thrombolytic(s) for deep venous thrombosis from MS-DRGs 252, 253, and 254 (Other Vascular Procedures with MCC, with CC, and without CC/MCC, respectively) to MS-DRGs 270, 271, and 272 (Other Major Cardiovascular Procedures with MCC, with CC, and without CC/MCC, respectively).

CMS found this subset of cases did not clinically align with patients undergoing surgery for acute myocardial infarction. However, the identified difference in resource consumption did warrant creating a new MS-DRG to reflect more appropriate payment for USAT and standard catheter-directed thrombolysis (CDT) procedures of peripheral vascular structures. CMS finalized their proposal to create new MS-DRGs 278 and 279 (Ultrasound Accelerated and Other Thrombolysis of Peripheral Vascular Structures with MCC and without MCC, respectively).

Coronary Intravascular Lithotripsy

A request was made to review MS-DRG assignment of cases describing percutaneous intravascular lithotripsy (IVL) involving the insertion of drug eluting and non-drug eluting stents. According to the requestor, cases involving IVL are more complex as this is a therapy deployed exclusively in several calcified coronary lesions that are associated with longer procedure times and increased resources.

CMS analysis showed that cases reporting percutaneous coronary IVL, with or without a stent had higher average costs and lengths of stay. CMS finalized their proposal to create MS-DRGs 323 and 324 (Coronary Intravascular Lithotripsy with Intraluminal Device with MCC and without MCC, respectively), and MS-DRG 325 (Coronary Intravascular Lithotripsy without Intraluminal Device).

Eliminating Distinction Between Bare-Metal and Drug-Eluting Stent (DES)

CMS noted in the proposed rule that it appears to no longer be necessary to subdivide the MS-DRGs for percutaneous cardiovascular procedures based on the type of coronary intraluminal device inserted. After consideration of public comments, CMS finalized their proposals to

• Delete MS-DRGs 246, 247, 248, and 249,
• Create new MS-DRG 321 (Percutaneous Cardiovascular Procedures with Intraluminal Device with MCC or 4+ Arteries/Intraluminal Devices) and MS-DRG 322 (Percutaneous Cardiovascular Procedures with Intraluminal Device without MCC),
• Reassign procedure codes from current MS-DRGs 246, 247, 248, and 249 to the new MS-DRGs 321 and 322, and
• Revise the titles for MS-DRGs 250 and 251 from “Percutaneous Cardiovascular without Coronary Artery Stent with MCC, and without MCC, respectively” to “Percutaneous Cardiovascular Procedures without Intraluminal Device with MCC, and without MCC, respectively” to better reflect the ICD-10-PCS terminology of “intraluminal devices” versus “stents” as used in the procedure code titles within the classification.

Cardiac Defibrillators and Shock

During a review of cardiogenic shock, CMS noted data analysis shows the average costs and length of stay are generally similar for cardiac defibrillator cases without regard to the presence of AMI, Heart Failure (HF), or shock. CMS finalized their proposals to:

• Delete MS-DRGs 222, 223, 224, 225, 226, and 227,
• Create three new MS-DRGs: MS-DRG 275 (Cardiac Defibrillator Implant with Cardiac Catheterization and MCC, and MS-DRGs 276 and 277 (Cardiac Defibrillator Implant with MCC, and without MCC, respectively), and
• Specific to MS-DRG 275, designate procedure codes describing cardiac catheterization as non-O.R. procedures affecting the MS-DRG.

The finalized changes go into effect October 1, 2023.

Resource: FY 2024 IPPS Final Rule (CMS-1785-F) webpage at https://www.cms.gov/medicare/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page

The FY 2024 IPPS Final Rule (CMS-1785-F) was issued August 1, 2023. This article focuses on final changes to Medicare Severity Diagnosis-Related Group (MS-DRG) classifications in Major Diagnostic Categories (MDCs) 02, 04, and 06 (Diseases and Disorders of the Eye, Respiratory System, and Digestive System, respectively).

MDC 02: Diseases and Disorders of the Eye: Retinal Artery Occlusion

A request was made to review the MS-DRG assignment of cases involving central retinal artery occlusion (CRAO). The assertion was that CRAO is a form of acute ischemic stroke which occurs when a vessel supplying blood to the brain is obstructed and there is growing recognition of this diagnosis as a vascular neurological problem. New evidence outlines treatment of patients with CRAO with acute stroke protocols, specifically with intravenous thrombolysis or hyperbaric oxygen therapy, to improve outcomes. Based on this request, data analysis and examining clinical considerations, CMS finalized their proposals to:  

• Reassign ICD-10-CM diagnosis codes H34.10, H34.11, H34.12, H34.13, H34.231, H34.232, H34.233, and H34.239 from MDC 02 MS-DRG 123 to MS-DRGs 124 and 125,
• Add procedure codes describing the administration of a thrombolytic agent listed in this section to MS-DRG 124,
• As part of the logic for MS-DRG 124, designate the administration of thrombolytic agent codes as non-O.R. procedures affecting the MS-DRG, and
• Change the titles of MS-DRGs 124 and 125 from “Other Disorders of the Eye, with and without MCC, respectively,” to “Other Disorders of the Eye with MCC or Thrombolytic Agent, with without MCC, respectively” to better reflect the assigned procedures.

   

  MDC 04: Diseases and Disorders of the Respiratory System: Ultrasound Accelerated Thrombolysis for Pulmonary Embolism

  A request was made to reassign cases reporting ultrasound accelerated thrombolysis (USAT) with administration of thrombolytic(s) for the treatment of pulmonary embolism (PE) from MS-DRGs 166, 167, and 168 (Other Respiratory O.R. Procedures with MCC, with CC, and without CC/MCC, respectively) to MS-DRGs 163, 164, and 165 (Major Chest Procedures with MCC, with CC, and without CC/MCC, respectively).

   

  Clinical and data analyses support creating a new base MS-DRG for cases reporting a principal diagnosis of PE and USAT or standard catheter directed thrombolysis (CDT) procedures with or without thrombolytics. CMS finalized their proposal to create a new MS-DRG 173 (Ultrasound Accelerated and Other Thrombolysis with Principal Diagnosis Pulmonary Embolism).

   

  MDC 04: Respiratory Infections and Inflammations Logic

  There are two logic lists for case assignment to MS-DRGs 177, 178, and 179 (Respiratory Infections and Inflammations with MCC, with CC, without CC/MCC, respectively). All diagnosis codes in the first logic list are designated as MCCs.

   

  Currently, if the principal diagnosis is from the second logic list and any of the diagnoses from the first logic list are also on the claim, the case would be assigned to MS-DRG 177. This is inconsistent with how other similar logic lists function in the ICD-10 grouper software. Therefore, CMS proposed to correct the logic for cases assigned to MS-DRG 177 by excluding the 15 diagnosis codes in the first logic list from acting as an MCC when reported as a secondary diagnosis when the principal diagnosis is from the second logic list.

   

  CMS finalized their proposal with the modification of excluding 11 diagnosis codes in the first logic list from acting as an MCC when any one of the listed codes is reported as a secondary diagnosis with a diagnosis code in the second logic list.

   

  The 11 diagnosis codes includes A48.1 (Legionnaire’s disease), J15.0 (Pneumonia due to Klebsiella pneumoniae), J15.1 (Pneumonia due to Pseudomonas), J15.20 (Pneumonia due staphylococcus, unspecified), J15.211 (Pneumonia due to Methicillin susceptible Staphylococcus aureus), J15.212 (Pneumonia due Methicillin resistant Staphylococcus aureus), J15.29 (Pneumonia due to other staphylococcus), J15.5 (Pneumonia due to Escherichia coli), J15.61 (Pneumonia due to Acinetobacter baumannii), J15.69 (Pneumonia due to other Gram-negative bacteria), and J15.8 (Pneumonia due to other specified bacteria).

   

  The five influenza codes in the first logic list (J10.00, J10.01, J10.08, J11.00, or J11. 08) will continue to be allowed to act as an MCC with a principal diagnosis from the second logic list in specific clinical scenarios.

   

  MDC 06: Diseases and Disorders of the Digestive System: Appendicitis

  ICD-10-CM diagnosis codes K35.20 (Acute appendicitis with generalized peritonitis, without abscess) and K35.21 (Acute appendicitis with generalized peritonitis, with abscess) will no longer be effective October 1, 2023. At that time, six new diagnosis codes describing acute appendicitis with generalized peritonitis, with and without perforation or abscess will become effective. The new codes are assigned to MS-DRGs 371, 372, and 373 (Major Gastrointestinal Disorders and Peritoneal Infections with MCC, with CC, and without MCC/CC, respectively).

   

  CMS notes that clinically both localized and generalized peritonitis in association with an appendectomy require the same level of patient care and believe the distinction between “complicated” versus “uncomplicated” is no longer meaningful regarding resource consumption. After consideration of comments received, CMS finalized their proposals to:

   

• Delete MS-DRGs 338, 339, 340, 341, 342, and 343,
• To create new MS-DRGs 397, 398, and 399 (Appendix Procedures with MCC, with CC, and without CC/MCC, respectively), and
• To no longer require a diagnosis in the definition of the logic for case assignment for the new MS-DRGs.

The finalized changes go into effect October 1, 2023.

CMS issued a display copy of the FY 2024 IPPS Final Rule on Monday, August 1, 2023. This article contains a high-level look at the final operating payment rate changes, Rural Emergency Hospitals change, social determinants of health codes severity designation changes, when the New COVID-19 Treatment Add-On Payments are set to end, and updates to the Affordable Care Act Quality Programs.

Proposed Payment Rate Changes

The proposed 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 meaningful electronic health record (EHR) use was 2.8%. This finalized increase is 3.1%.

The increase in operating and capital payment rates will generally increase hospital payments in FY 2024 by $2.2 billion.

Rural Emergency Hospitals (REHs) and Graduate Medical Education (GME)

REH’s became a new provider type effective January 1, 2023. You can read more about them in a related MLN Fact Sheet. CMS finalized their proposal to allow REH’s serve as training sites for Medicare GME payment purposes to “help support graduate medical training in rural areas.”

Severity Level Designation Change for Z Codes Describing Homelessness

The U.S. Department of Health and Human Services (HHS) defines Social Determinants of Health (SDOH) as "the conditions in the environments where people are born, live, learn, work, play, worship, and age that affect a wide range of health, functioning, and quality-of-life outcomes and risks." Effective February 18, 2018, the AHA Coding Clinic published advice allowing the reporting of SDOH codes Z55-Z65, based on information documented by all clinicians involved in the care of the patient.

For FY 2024, CMS finalized their proposal to change the severity level designation for diagnosis codes Z59.00 (Homelessness, unspecified), Z59.01 (Sheltered homelessness), and Z59.02 (Unsheltered homelessness) from NonCC to CC for FY 2024.

COVID-19 Treatment Add-On Payment (NCTAP) to End September 30, 2023

In response to the Public Health Emergency (PHE), CMS established NCTAP for eligible discharges during the PHE. In the FY 2022 final rule, CMS finalized the extension of NCTAP through the end of the FY in which the PHE ends. With the PHE ending on May 11, 2023, discharges involving eligible products would continue to be eligible for the NCTAP through September 30, 2023 (that is, through the end of FY 2023).”

Affordable Care Act Quality Programs

Hospital Readmission Reduction Program (HRRP)

CMS did not propose or finalize any changes to this value-based purchasing program that reduces payments to hospitals with excess readmissions.

Hospital-Acquired Condition (HAC) Reduction Program

This program creates an incentive for hospitals to reduce the incidence of hospital-acquired conditions by reducing payment by 1% for applicable hospitals ranking in the worst-performing quartile on select measures. For FY 2023, due to the ongoing COVID-19 PHE, no hospital was subject to the 1-percent payment reduction. You can read more about this program in a related FY 2023 CMS Fact Sheet.

For FY 2024, CMS finalized the proposal to establish a validation reconsideration process for hospitals who fail data validation beginning with the FY 2025 program year, affecting calendar year 2022 discharges. They also finalized modification of the validation targeting criteria to include hospitals granted extraordinary circumstances exceptions (ECEs) beginning with the FY 2027 program year, affecting calendar year 2024 discharges.

Hospital Value-Based Purchasing (VBP) Program

This is a budget-neutral program funded by reducing hospitals’ base operating DRG payments each fiscal year by 2% and redistributing the entire amount back to the hospitals as value-based incentive payments. Like the HAC Reduction Program, CMS finalized hospitals’ keeping the 2% payment due to the ongoing COVID-19 PHE. For FY 2024, CMS finalized several changes to this program for FY 2024, for example, CMS:

• Adopted the Severe Sepsis and Septic Shock: Management Bundle measure in the Safety Domain beginning with the FY 2026 program year.
• Adopted a modified version of the Medicare Spending Per Beneficiary (MSPB) Hospital measure beginning with the FY 2028 program year, and
• Adopted a modified version of the Hospital-level Risk-Standardized Rate (RSCR) Following Elective Primary Total Hip Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) measure beginning with the FY 2030 program year.

Resources

August 1, 2023 CMS Fact Sheet: FY 2024 Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital Prospective Payment System (LTCH PPS) Final Rule – CMS-1785-F and CMS-1788-F Fact Sheet: https://www.cms.gov/newsroom/fact-sheets/fy-2024-hospital-inpatient-prospective-payment-system-ipps-and-long-term-care-hospital-prospective-0