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IPPS FY 2018 Final Rule: Part 3 MS-DRGs
Published on Aug 22, 2017
20170822
 | Recovery Auditor 
 | Coding 
 | Documentation 

At least annually, 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 third and final article in our series about the FY 2018 IPPS Final Rule. We finish by sharing several of the changes to the Medicare Severity Diagnosis-Related Group (MS-DRG) Classifications.   

MDC 1: Diseases and Disorders of the Nervous System

Functional Quadriplegia

Section 1.C.18.f of the FY 2017 ICD-10-CM Official Coding Guidelines addresses coding the diagnosis of functional quadriplegia. “Functional quadriplegia (described by diagnosis code R53.2) is the lack of ability to use one’s limbs or to ambulate due to extreme debility. The condition is not associated with neurologic deficit or injury, and diagnosis code R53.2 should not be used to identify cases of neurologic quadriplegia. In addition, the Guidelines state that the diagnosis code should only be assigned if functional quadriplegia is specifically documented by a physician in the medical record, and the diagnosis of functional quadriplegia is not associated with a neurologic deficit or injury. A physician may document the diagnosis of functional quadriplegia as occurring with a variety of conditions.”

CMS received a request to reassign cases identified by diagnosis code R53.2 from MS-DRGs 052 and 053 (Spinal Disorders and injuries with and without CC/MCC, respectively). One commenter noted the ICD-10-CM code for functional quadriplegia is located in Chapter 18, Symptoms, Signs and Abnormal findings because it can be the result of a variety of underlying conditions and it is not appropriate to classify this diagnosis as a nervous system disorder.  Clinical advisors agreed and CMS has finalized the assignment of code R532 (functional quadriplegia) to MS-DRGs 947 and 948 (Signs and Symptoms with MCC and without MCC, respectively).

Responsive Neurostimulator (RNS©) System

The RNS© Neurostimulator is a cranially implanted neurostimulator that is a treatment option for persons diagnosed with medically intractable epilepsy. Currently these cases are assigned to MS-DRG 023 (Craniotomy with Major Device Implant or Acute Complex Central Nervous System (CNS) Principal Diagnosis (PDX) with MCC or Chemo Implant) and MS-DRG 024 (Craniotomy with Major Devise Implant or Acute Complex CNS PDx without MCC).

For FY 2018, CMS is reassigning all cases with a principal diagnosis of epilepsy… and one of the following ICD-10-PCS code combinations capturing cases with the neurostimulator generators inserted into the skull (including cases involving the use of the RNS© neurostimulator), to MS-DRG 023, even if there is no MCC reported:

  • 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H00MZ (Insertion of neurostimulator lead into brain, open approach);
  • 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H03MZ (Insertion of neurostimulator lead into brain, percutaneous approach); and
  • 0NH00NZ (Insertion of neurostimulator generator into skull, open approach), in combination with 00H04MZ (Insertion of neurostimulator lead into brain, percutaneous endoscopic approach).

A complete list of epilepsy codes assigned to MS-DRG 023 can be found on page 38016 of the Final Rule.

The title for MS-DRG 023 is changing to “Craniotomy with Major Device Implant or Acute Complex Central Nervous System (CNS) Principal Diagnosis (PDX) with MCC or Chemotherapy Implant or Epilepsy with Neurostimulator” to reflect the modifications to MS-DRG assignments.

Precerebral Occlusion or Transient Ischemic Attack with Thrombolytic

“At the onset of stroke symptoms, tPA must be given within 3 hours (or up to 4.5 hours for certain eligible patients) in an attempt to dissolve a clot and improve blood flow to the specific area affected in the brain. If, upon receiving the tPA, the stroke symptoms completely resolve within 24 hours and imaging studies (if performed) are negative, the patient has suffered what is clinically defined as a transient ischemic attack, not a stroke.”

For FY 2018, ICD-10-CM diagnosis codes assigned to MS-DRGs 067, 068, and 069 will be added to the GROUPER logic for MS-DRGs 061, 062 and 063 when sequenced as principal diagnosis and reported with an ICD-10-PCS code describing use of a thrombolytic agent (for example, tPA). The title of MS-DRGs 061, 062 and 063 are changing to “Ischemic Stroke, Precerebral Occlusion or Transient Ischemia with Thrombolytic Agent with MCC, with CC and without CC/MCC” respectively, and the title of MS-DRG 069 is changing to “Transient Ischemia without Thrombolytic.”

MDC 2: Diseases and Disorders of the Eye

Swallowing Eye Drops (Tetrahydrozoline)

CMS finalized moving the following four diagnosis codes describing swallowing eye drops:

  • 5X1A (Poisoning by ophthalmological drugs and preparations, accidental (unintentional), initial encounter);
  • 5X2A (Poisoning by ophthalmological drugs and preparations, intentional self-harm, initial encounter);
  • 5X3A (Poisoning by ophthalmological drugs and preparations, assault, initial encounter); and
  • 5X4A (Poisoning by ophthalmological drugs and preparations, undetermined, initial encounter).

These codes will move from MS-DRGs 124 and 125 (Other Disorders of the Eye with and without MCC, respectively) to MS- DRGs 917 and 918 (Poisoning and Toxic Effects of Drugs with and without MCC, respectively).

MDC 5: Diseases and Disorders of the Circulatory System

Percutaneous Cardiovascular Procedures and Insertion of a Radioactive Element

Currently the following six procedure codes are included in MS-DRG 246 (Percutaneous Cardiovascular Procedures with Drug-Eluting Stent with MCC or 4+ Vessels or Stents), MS-DRG 247 (Percutaneous Cardiovascular Procedures with Drug-Eluting Stent without MCC), MS-DRG 248 (Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent with MCC or 4= Vessels or Stents), and MS-DRG and 249 (Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent without MCC):  

  • WHC01Z: Insertion of radioactive element into mediastinum, open approach
  • 0WHC31Z: Insertion of radioactive element into mediastinum, percutaneous approach
  • 0WHC41Z: Insertion of radioactive element into mediastinum, percutaneous endoscopic approach
  • 0WHD01Z: Insertion of radioactive element into pericardial cavity, open approach
  • 0WHD31Z: Insertion of radioactive element into pericardial cavity, percutaneous approach
  • 0WHD41Z: Insertion of radioactive element into pericardial cavity, percutaneous endoscopic approach

When any of the above procedure codes are reported without a percutaneous cardiovascular procedure code, they are assigned to MS-DRG 264 (Other Circulatory System O.R. Procedures).

“Unlike procedures involving the insertion of stents, none of the procedures described by the procedure codes listed above are performed in conjunction with a percutaneous cardiovascular procedure, and two of the six procedures described by these procedure codes (ICD-10-PCS codes 0WHC01Z and 0WHD01Z) are not performed using a percutaneous approach, but rather describe an open approach to performing the specific procedure…Furthermore, the indications for the insertion of a radioactive element typically involve a diagnosis of cancer, whereas the indications for the insertion of a coronary artery stent typically involve a diagnosis of coronary artery disease.” For FY 2018, these six “insertion of radioactive element” codes will maintain their current assignment to MS-DRG 264 and be removed from MS-DRGs 246 through 249.  

MS-DRG Title Change for MS-DRGs 246 and 248

CMS finalized changing the title for MS-DRG 246 and 247 to better reflect the ICD-10-PCS terminology of “arteries” versus “vessels.” The two new MS-DRG titles will be:

  • MS-DRG 246: Percutaneous Cardiovascular Procedures with Drug-Eluting Stent with MCC or 4+ Arteries or Stents
  • MS-DRG 248: Percutaneous Cardiovascular Procedures with Non-Drug-Eluting Stent with MCC or 4+ Arteries or Stents

Percutaneous Mitral Valve Replacement Procedures

“MS-DRGs 266 and 267 were created to uniquely classify the subset of high-risk cases representing patients who undergo a cardiac valve replacement procedure performed by a percutaneous (endovascular) approach.” 

Currently GROUPER logic for aortic and pulmonary valves are included in MS-DRGs 266 and 266. However, for the mitral valve, the GROUPER logic includes the procedures in the transapical, percutaneous approach.

CMS agreed with a requestor that all cardiac valve replacement procedures should be grouped within the same MS-DRG and finalized the reassignment of the following four mitral valve replacement procedures from MS-DRGs 216 through 221 (Cardiac Valve and Other Major Cardiothoracic Procedures with and without Cardiac Catheterization with MCC, with CC and without CC/MCC respectively) to MS-DRGs 266 and 267 (Endovascular Cardiac Valve Replacement with MCC and without MCC, respectively)

  • 02RG37Z: Replacement of mitral valve with autologous tissue substitute, percutaneous approach
  • 02RG38Z: Replacement of mitral valve with zooplastic tissue, percutaneous approach
  • 02RG3JZ: Replacement of mitral valve with synthetic substitute, percutaneous approach
  • 02RG3KZ: Replacement of mitral valve with nonautologous tissue substitute, percutaneous approach

Additionally, CMS finalized the assignment of the following eight new procedures codes, effective October 1, 2017, describing percutaneous and transapical, percutaneous tricuspid valve replacement procedures to MS-DRGs 266 and 267:  

  • 02RJ37H: Replacement of tricuspid valve with autologous tissue substitute, transapical, percutaneous approach.
  • 02RJ37Z: Replacement of tricuspid valve with autologous tissue substitute, percutaneous approach.
  • 02RJ38H: Replacement of tricuspid valve with zooplastic tissue, transapical, percutaneous approach.
  • 02RJ38Z: Replacement of tricuspid valve with zooplastic tissue, percutaneous approach.
  • 02RJ3JH: Replacement of tricuspid valve with synthetic substitute, transapical, percutaneous approach.
  • 02RJ3JZ: Replacement of tricuspid valve with synthetic substitute, percutaneous approach.
  • 02RJ3KH: Replacement of tricuspid valve with nonautologous tissue substitute, transapical, percutaneous approach.
  • 02RJ3KZ: Replacement of tricuspid valve with nonautologous tissue substitute, percutaneous approach.

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

Total Ankle Replacement (TAR) Procedures

TAR procedures are currently assigned to MS-DRGs 469 and 470 (Major Joint Replacement or Reattachment of Lower Extremity with MCC and without MCC, respectively).  

CMS finalized that all TAR procedures be reassigned from MS-DRG 470 to MS-DRG 469, even when there is no MCC reported noting “the claims data support the fact that these cases require more resources than other cases assigned to MS-DRG 470.”

Specific codes proposed for reassignment to MS-DRG 469 include the following:

  • 0SRF0J9 (Replacement of right ankle joint with synthetic substitute, cemented, open approach);
  • 0SRF0JA (Replacement of right ankle joint with synthetic substitute, uncemented, open approach);
  • 0SRF0JZ (Replacement of right ankle joint with synthetic substitute, open approach);
  • 0SRG0J9 (Replacement of left ankle joint with synthetic substitute, cemented, open approach);
  • 0SRG0JA (Replacement of left ankle joint with synthetic substitute, uncemented, open approach); and
  • 0SRG0JZ (Replacement of left ankle joint with synthetic substitute, open approach) for FY 2018.

Additionally, CMS finalized the following title changes for MS-DRG 469 and 470:

  • MS-DRG 469: Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity with MCC or Total Ankle Replacement; and
  • MS-DRG 470: Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity without MCC.

Revision of Total Ankle Replacement

CMS noted in the Proposed Rule that they had received two requests to modify the MS-DRG assignment for revision of Total Ankle Replacement (TAR) procedures, indicating these procedures are assigned to MS-DRGs 515, 516, and 517 (Other Musculoskeletal System and Connective Tissue O.R. Procedures with MCC, with CC, and without CC/MCC respectively).

CMS Response Key Takeaways

  • CMS conducted an analysis of the correct coding revision and agreed with commenters that these cases are not captured with ICD-10-PCS codes with the root operation “Revision” as stated in the Proposed Rule. Instead, the revision of TAR cases are correctly coded using a combination of codes with the root operation “Removal and Replacement” as commenters suggested.
  • CMS has asked the American Hospital Association to provide additional information on how to capture revision of TARs in a future issue of Coding Clinic for ICD-10.
  • CMS noted that an error in replication for the ICD-10 MS-DRGs resulted in the revision of TAR procedures being assigned to MS-DRGs 469 and 470. This error was not noticed until commenters on the FY 2018 proposed rule pointed out that accurate coding of TARs would result in cases not being assigned to MS-DRGs 515, 516, and 517.
  • Since the implementation of ICD-10 MS-DRGs, revision TAR procedures have not been assigned to MS-DRGs 515,516, and 517. Therefore, there is no need to modify MS-DRG logic to reassign the procedures because correctly coded cases are assigned to MS-DRGs 469 and 470.
  • CMS noted that by finalizing that all TAR procedure codes be assigned to MS-DRG 469, even if there is no MCC present, for FY 2018 this will result in all revision of TAR procedures being assigned to MS-DRG 469.

Combined Anterior/Posterior Spinal Fusion

It was brought to the attention of CMS “that 7 of the 10 new ICD-10-PCS procedure codes describing fusion using a nanotextured surface interbody fusion device were not added to the appropriate GROUPER logic list for MS-DRGs 453, 454, and 455 (Combined Anterior/Posterior Spinal Fusion with MCC, with CC and without CC/MCC, respectively), effective October 1, 2016. The logic for MS-DRGs 453, 454, and 455 is comprised of two lists: an anterior spinal fusion list and a posterior spinal fusion list. Assignment to one of the combined spinal fusion MS-DRGs requires that a code from each list be reported.”

After reviewing spinal fusion codes using a nanotextured surface interbody fusion device CMS finalized the following:

  • Moving 7 codes describing spinal fusion using a nanotextured surface interbody fusion device from the posterior spinal fusion list to the anterior spinal fusion list in the GROUPER logic for MS-DRGS 453, 454, and 455.
  • Moving 149 procedures codes describing spinal fusion of the anterior column with a posterior approach from the posterior spinal fusion list to the anterior spinal fusion list in the GROUPER logic for MS-DRGs 453, 454, and 455.
  • Deleting 33 procedure codes describing spinal fusion of the posterior column with an interbody fusion device from MS-DRGs 453 through 460 and 471 through 473, as well as from the ICD-10-PCS classification.

Review of Procedures Codes in MS-DRGs 981 through 983, 984 through 986; and 987 through 989

Annually, CMS reviews the following cases to determine if it would be appropriate to change the procedures assigned among these MS-DRGs:

  • MS-DRGs 981, 982, and 983: Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively,
  • MS-DRGs 984, 985, and 986: Prostatic O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively; and
  • MS-DRGs 987, 988, and 989: Nonextensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively.

These MS-DRGs are reserved for when none of the O.R. procedures performed are related to the principal diagnosis. They are “intended to capture atypical cases, that is, those cases not occurring with sufficient frequency to represent a distinct, recognizable clinical group.”

Based on claims data review CMS found it is no longer necessary to maintain a separate set of MS-DRGs specifically for the prostatic O.R. procedures and therefore finalized the following:

  • Reassign procedure codes currently assigned to MS-DRGs 984 through 986 to MS-DRGs 987; and
  • Delete MS-DRGs 984, 985 and 986 as they would no longer be needed.

In the Final Rule, CMS encourages input from stakeholders concerning annual IPPS updates. In previous years, to be considered for the next annual proposed rule update, CMS has required that input be sent to them by December 7th of the prior year. As CMS undertakes working with ICD-10 data they note this will require additional time and are changing the deadline to request updates to MS-DRGs to November 1 of each year which provides them with 5 additional weeks for the data analysis and review process. For those interested in submitting comments and/or suggestions for FY 2019, they need to be sent by November 1, 2017, via the CMS MS_DRG Classification Change Requests Mailbox located at: MSDRGClassificationChange@cms.hhs.gov.

As stated in the opening of this article, we have shared a few key highlights from this portion of the Final Rule. MMP encourages all key stakeholders to take the time to dive a little deeper into the detail.

Beth Cobb

May Medicare Transmittals and Other Updates
Published on May 30, 2017
20170530
 | Recovery Auditor 
 | Billing 
 | Medicare Coverage 
 | Outpatient Services 

TRANSMITTALS

Update FISS Editing to Include the Admitting Diagnosis Code Field

Summary: Updates various system edits to look at the admitting diagnosis field. FISS editing is now being updated to ensure that all of the National Coverage Determination (NCD) edits within Reason Code ranges 3xxxx and 59xxx that are tied to the diagnosis code fields (other than the primary diagnosis field) include the admitting diagnosis field for Inpatient claims on Types of Bill (TOB) 011x, 012x, 018x, 021x, and 022x.

Screening for Hepatitis B Virus (HBV) Infection

Summary: Medicare will cover screening for Hepatitis B Virus (HBV) infection for certain individuals when performed with an FDA approved/cleared laboratory tests

REVISED: Revision to clarify language on page 3, under the “Professional Billing Requirements.” It now reads, only when services are ordered by the following provider specialties found on the provider’s enrollment record…

Implementing the Remittance Advice Messaging for the 20 Hour Weekly Minimum for Partial Hospitalization Program Services

Summary: Implements informational messaging, effective October 1, 2017, that conveys supplemental and educational information to the provider submitting claims for PHP services where the patient did not receive the minimum 20 hours per week of therapeutic services his plan of care indicates is required, on claims with line item date of service (LIDOS) on or after October 1, 2017.

New Physician Specialty Code for Advanced Heart Failure and Transplant Cardiology, Medical Toxicology, and Hematopoietic Cell Transplantation and Cellular Therapy

Summary: Establishes new physician specialty codes for Advanced Heart Failure and Transplant Cardiology (C7), Medical Toxicology (C8), and Hematopoietic Cell Transplantation and Cellular Therapy (C9).

Payment for Moderate Sedation Services Furnished with Colorectal Cancer Screening Tests

Summary: Ensures accurate program payment for moderate sedation services furnished in conjunction with screening colonoscopy services for which the beneficiary should not be charged the coinsurance or deductible.

Office of Inspector General Report: Stem Cell Transplantation

Summary: This article was revised on May 1, 2017, to make a number of clarifications and to delete the table that had been in the article.

Update FISS Editing to Include All Three Patient Reason for Visit Code Fields

Summary: FISS edits to ensure all of the National Coverage Determination (NCD) edits within Reason Code ranges 3xxxx and 59xxx are tied to the diagnosis code fields including all three Patient Reason for Visit (PRV) fields for outpatient hospital claims on Types of Bills (TOB) 013x and 085x. CR9672 makes no policy changes.

New Common Working File (CWF) Medicare Secondary Payer (MSP) Type for Liability Medicare Set-Aside Arrangements (LMSAs) and No-Fault Medicare SetAside Arrangements (NFMSAs)

Summary: Establishes two (2) new set-aside processes: a Liability Insurance Medicare Set-Aside Arrangement (LMSA), and a No-Fault Insurance Medicare Set-Aside Arrangement (NFMSA).

Clarifying Medical Review of Hospital Claims for Part A Payment

Summary: Clarifies the medical review requirements for Part A payment of short stay hospital claims (more commonly referred to as the "Two-Midnight" Rule) for MACs, Supplemental Medical Review Contractors (SMRC), Recovery Audit Contractors and the Comprehensive Error Rate Testing (CERT) contractors.

Quarterly Healthcare Common Procedure Coding System (HCPCS) Drug/Biological Code Changes – July 2017 Update

Summary: The HCPCS code set is updated on a quarterly basis. Change Request (CR) 10107 informs MACs of updating specific drug/biological HCPCS codes.

July 2017 Integrated Outpatient Code Editor (I/OCE) Specifications Version 18.2

MLN Matters Number: MM10115

Summary: The I/OCE is being updated July 1, 2017. The I/OCE routes all institutional outpatient claims (which includes non-Outpatient Prospective Payment System (OPPS) hospital claims) through a single integrated OCE.

OTHER MEDICARE ANNOUNCEMENTS

Medicare Program; Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model (CJR); Delay of Effective Date

Summary: This final rule finalizes May 20, 2017 as the effective date of the rule. It also finalizes a delay of the applicability date of the regulations from July 1, 2017 to January 1, 2018.

April Medicare Transmittals and Other Updates
Published on Apr 26, 2017
20170426
 | Recovery Auditor 
 | Billing 
 | Medicare Coverage 
 | Outpatient Services 

Transmittals

FISS Implementation of the Restructured Clinical Lab Fee Schedule

Summary: Informs MACs about the changes to the Fiscal Intermediary Shared System (FISS) to incorporate the revised CLFS containing the National fee schedule rates.

Payment for Moderate Sedation Services

Summary: Revises existing Medicare Claims Processing Manual language to bring the manual in line with current payment policy for moderate sedation and anesthesia services.

Providers should refer to the revised Medicare Claims Processing Manual, Chapter12 (Physicians/Non-physician Practitioners), Sections 50 and 140 for information regarding the reporting of moderate sedation and anesthesia services.

Quarterly Update to the National Correct Coding Initiative (NCCI) Procedure to Procedure (PTP) Edits, Version 23.2, Effective July 1, 2017

Summary: Informs about the quarterly update to the National Correct Coding Initiative (NCCI) procedure to procedure edits (PTP).

Other Medicare Announcements

Final Rule Correction – Medicare Physician Fee Schedule

  • Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B for CY 2017; Medicare Advantage Bid Pricing Data Release; Medicare Advantage and Part D Medical Loss Ratio Data Release; Medicare Advantage Provider Network Requirements; Expansion of Medicare Diabetes Prevention Program Model; Medicare Shared Savings Program Requirements; Corrections
  • March 22, 2017
  • https://www.gpo.gov/fdsys/pkg/FR-2017-03-22/pdf/2017-05675.pdf

Summary: Corrects technical errors in the addenda to the final rule published in the November 15, 2016, Federal Register.

CMS Voluntary Self-Referral Disclosure Protocol and Form

Summary: New protocol and form to self-disclose actual or potential violations of the physician self-referral statute and/or noncompliant financial relationships with physician(s).

Renewal of Advance Beneficiary Notice of Non-coverage, Form CMS-R-131

Summary: The ABN form and instructions have been approved by the Office of Management and Budget (OMB) for renewal. While there are no changes to the form itself, providers should take note of the newly incorporated expiration date on the form.  With the 2016 PRA submission, a non-substantive change has been made to the ABN. In accordance with Section 504 of the Rehabilitation Act of 1973 (Section 504), the form has been revised to include language informing beneficiaries of their rights to CMS nondiscrimination practices and how to request the ABN in an alternative format if needed.

Clinical Laboratory Data Reporting: Enforcement Discretion

Summary: CMS will exercise enforcement discretion until May 30, 2017, regarding the data-reporting period for reporting applicable information under the Clinical Laboratory Fee Schedule and the application of the Secretary’s potential assessment of civil monetary penalties for failure to report applicable information. This discretion applies to entities that are subject to the data reporting requirements adopted in the Medicare Clinical Diagnostic Laboratory Tests Payment System final rule published on June 23, 2016 (81 FR 41036).

Decision Memo for Hyperbaric Oxygen (HBO) Therapy (Section C, Topical Oxygen) (CAG-00060R)

Summary: Decision memo for HBO therapy that removes the coverage exclusion of Continuous Diffusion of Oxygen Therapy (CDO) from NCD Manual 20.29, Section C. CMS has decided that no National Coverage Determination is appropriate at this time concerning the use of topical oxygen for the treatment of chronic wounds and will amend NCD 20.29 by removing Section C, Topical Application of Oxygen. Medicare coverage of topical oxygen for the treatment of chronic wounds will be determined by the local contractors.

New Mailbox for BNI Notices Questions

  • Effective April 13, 2017

Questions regarding any of the Fee For Service Beneficiary Notice Initiative (BNI) notices may be sent to the new mailbox:  BNImailbox@cms.hhs.gov. 

The BNI notices are:

  • FFS Advance Beneficiary Notice of Non-coverage (FFS ABN)
  • FFS Home Health Change of Care Notice (FFS HHCCN)
  • FFS Skilled Nursing Facility Advance Beneficiary Notice (FFS SNFABN) and SNF Denial Letters
  • FFS Hospital-Issued Notices of Non-coverage (FFS HINNs)
  • FFS Expedited Determination Notices for Home Health Agencies, Skilled Nursing Facility, Hospice and Comprehensive Outpatient Rehabilitation Facility  (FFS Expedited Determination Notices)
  • Important Message from Medicare (IM) and Detailed Notice of Discharge (DND) (Hospital Discharge Appeal Notices)
  • FFS Notice of Exclusion from Medicare Benefits - Skilled Nursing Facility (FFS NEMB SNF) 

There is an exception for the Medicare Outpatient Observation Notice (MOON). Continue to send questions regarding the MOON to MOONMailbox@cms.hhs.gov.

Fiscal Year (FY) 2018 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System Proposed Rule

Summary: Updates 2018 Medicare payment and polices when patients are admitted into hospitals. The rule updates payment rates, quality initiatives, and code sets. In addition to the payment and policy proposals, CMS is soliciting ideas for regulatory, sub-regulatory, policy, practice and procedural changes to improve the health care delivery system, make it less bureaucratic and complex, and reduce burden for clinicians, providers and patients in a way that increases quality of care and decreases costs.

March Medicare Transmittals and Other Updates
Published on Mar 27, 2017
20170327
 | Recovery Auditor 
 | Billing 
 | Medicare Coverage 
 | Outpatient Services 
 | Patient Status 

TRANSMITTALS

Gender Dysphoria and Gender Reassignment Surgery

Summary: Coverage determinations for gender reassignment surgery will continue to be made by the local MACs on a case-by-case basis.

April 2017 Integrated Outpatient Code Editor (I/OCE) Specifications Version 18.1

Summary: Instructions and specifications for the Integrated Outpatient Code Editor (I/OCE) used for Outpatient Prospective Payment System (OPPS) and non-OPPS claims.

Clarification of Admission Order and Medical Review Requirements

Summary: Clarifies the rulemaking language of the Centers for Medicare & Medicaid Services (CMS) as it relates to “Admission and Medical Review Criteria for Hospital Inpatient Services Under Medicare Part A; Requirements for Physician Orders.”

Billing for Advance Care Planning (ACP) Claims

Summary: Provides billing instructions for ACP when furnished as an optional element of an AWV. CMS has made the CPT code 99497 (Advance care planning) separately payable for Medicare OPPS claims when the service meets the criteria for separate payment under OPPS.

April 2017 Update of the Hospital Outpatient Prospective Payment System (OPPS)

  • MLN Matters® Number: MM 10005
  • Related Change Request (CR) #: CR 10005
  • Related CR Release Date: March 3, 2017
  • Effective Date: April 1, 2017
  • Related CR Transmittal #: R3728CP
  • Implementation Date: April 3, 2017
  • https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10005.pdf
  • Affects providers and suppliers who submit claims to Medicare Administrative Contractors (MAC), including Home Health and Hospice (HH&H) MACs, for services provided to Medicare beneficiaries paid under the Outpatient Prospective Payment System (OPPS).

Summary: Describes changes to and billing instructions for various payment policies implemented in the April 2017 OPPS update.

Changes to the Laboratory National Coverage Determination (NCD) Edit Software for July 2017

Summary: Announces the changes that will be included in the July 2017 quarterly release of the edit module for clinical diagnostic laboratory services. This is a Recurring Update Notification that applies to Chapter 16, Section 120.2, of the ʺMedicare Claims Processing Manual.”

 

Clarification of Patient Discharge Status Codes and Hospital Transfer Policies

Summary: This article was rescinded on March 15, 2017. Information on the inpatient transfer policy is located in the "Medicare Claims Processing Manual" (100-04), Chapter 3. For questions concerning clarification on the proper usage of patient discharge status codes, providers should be utilizing the "UB-04 Manual" which is maintained by the National Uniform Billing Committee.  

 

OTHER MEDICARE ANNOUNCEMENTS

 

Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model; Delay of Effective Date

Summary: This interim final rule with comment period (IFC) further delays the effective date of the final rule entitled ‘‘Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model’’ from March 21, 2017 until May 20, 2017. This IFC also delays the applicability date of the regulations at 42 CFR part 512 from July 1, 2017 to October 1, 2017 and effective date of the specific CJR regulations itemized in the DATES section from July 1, 2017 to October 1, 2017. We seek comment on the appropriateness of this delay, as well as a further applicability date delay until January 1, 2018.

Proposed Decision Memo for Supervised Exercise Therapy (SET) for Symptomatic Peripheral Artery Disease (PAD) (CAG-00449N)

Summary: CMS) proposes that the evidence is sufficient to cover supervised exercise therapy (SET) for beneficiaries with intermittent claudication (IC) for the treatment of symptomatic peripheral artery disease (PAD). 

February Medicare Transmittals and Other Updates
Published on Feb 28, 2017
20170228
 | Recovery Auditor 
 | Coding 
 | Outpatient Services 

TRANSMITTALS

Medicare Outpatient Observation Notice (MOON) Instructions

Summary: Updates Chapter 30 of the “Medicare Claims Processing Manual” to include the Medicare Outpatient Observation Notice (MOON), CMS-10611, and related instructions. Providers should use the MOON to inform Medicare beneficiaries when they are an outpatient receiving observation services, and are not an inpatient of the hospital or a Critical Access Hospital (CAH). The instructions included in Chapter 30 provide guidance for proper issuance of the MOON.

ICD-10 Coding Revisions to National Coverage Determination (NCDs)

  • MLN Matters® Number:MM9861
  • Related Change Request (CR) #: CR 9861
  • Related CR Release Date: February 3, 2017
  • Effective Date: October 1, 2016 - Unless otherwise noted in individual requirements
  • Related CR Transmittal #: R1792OTN
  • Implementation Date: March 3, 2017 - MAC local systems; April 3, 2017 - FISS, MCS, CWF Shared systems
  • https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM9861.pdf
  • Affects physicians and other providers submitting claims to Medicare Administrative Contractors (MACs) for services provided to Medicare beneficiaries.

Summary: The 10th maintenance update of ICD-10 conversions and other coding updates specific to national coverage determinations (NCDs).

Revisions to State Operations Manual (SOM), Appendix C-Survey Procedures and Interpretive Guidelines for Laboratories and Laboratory Services

Implementation of New Influenza Virus Vaccine Code

Summary: Provides instructions for payment and edits for the common working file (CWF) to include influenza virus vaccine code 90682 (Influenza virus vaccine, quadrivalent (RIV4), derived from recombinant DNA, hemagglutinin (HA) protein only, preservative and antibiotic free, for intramuscular use) for claims with dates of service on or after July 1, 2017.

Quarterly Update to the National Correct Coding Initiative (NCCI) Procedure to Procedure (PTP) Edits, Version 23.1, Effective April 1, 2017

Summary: The latest package of Correct Coding Initiative (CCI) Procedure to Procedure (PTP) edits, Version 23.1, effective April 1, 2017. The National Correct Coding Initiative (NCCI) developed by the Centers for Medicare & Medicaid (CMS) helps promote national correct coding methodologies and controls improper coding.

Qualified Medicare Beneficiary Indicator in the Medicare Fee-For-Service Claims Processing System

  • MLN Matters® Number: MM9911
  • Related Change Request (CR) #: CR 9911
  • Effective Date: for claims processed on or after October 2, 2017
  • Related CR Release Date: February 3, 2017
  • Related CR Transmittal #: R3715CP
  • Implementation Date: October 2, 2017
  • https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM9911.pdf
  • Affects physicians, providers, and suppliers submitting claims to Medicare Administrative Contractors (MACs), including Home Health & Hospice MACs and Durable Medical Equipment MACs, for services provided to Medicare beneficiaries.

Summary: Modifies the Medicare claims processing systems to help providers more readily identify the Qualified Medicare Beneficiary (QMB) status of each patient and to support providers’ ability to follow QMB billing requirements.

New Common Working File (CWF) Medicare Secondary Payer (MSP) Type for Liability Medicare Set-Aside Arrangements (LMSAs) and No-Fault Medicare Set-Aside Arrangements (NFMSAs)

Summary: CMS will establish two (2) new set-aside processes: a Liability Insurance Medicare Set-Aside Arrangement (LMSA), and a No-Fault Insurance Medicare Set-Aside Arrangement (NFMSA). An LMSA or an NFMSA is an allocation of funds from a liability or an auto/no-fault related settlement, judgment, award, or other payment that is used to pay for an individual’s future medical and/or future prescription drug treatment expenses that would otherwise be reimbursable by Medicare.

Clinical Laboratory Fee Schedule – Medicare Travel Allowance Fees for Collection of Specimens

Summary: Revises the payment of travel allowances when billed on a per mileage basis using Health Care Common Procedure Coding System (HCPCS) code P9603 and when billed on a flat-rate basis using HCPCS code P9604 for Calendar Year (CY) 2017.

Advance Care Planning (ACP) Implementation for Outpatient Prospective Payment System (OPPS) Claims

Summary: Implements system changes necessary to process Advance Care Planning (ACP) services for OPPS claims.

ICD-10 Coding Revisions to National Coverage Determinations (NCDs)

  • MLN Matters® Number: MM9982
  • Related Change Request (CR) #: CR 9982
  • Effective Date: July 1, 2017 (Unless otherwise noted in individual NCDs)
  • Related CR Release Date: February 17, 2017
  • Related CR Transmittal #: R1798OTN
  • Implementation Date: March 20, 2017, for MAC edits and July 3, 2017, for Shared Systems
  • https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM9982.pdf
  • Affects physicians and other providers submitting claims to Medicare Administrative Contractors (MACs) for services provided to Medicare beneficiaries.

Summary: The 11th maintenance update of ICD-10 conversions and other coding updates specific to national coverage determinations (NCDs).

Episode Payment Model Operations

Summary: Prepares Medicare’s claims processing systems and provides information for implementation of Episode Payment Models (EPMs)

 

OTHER MEDICARE ANNOUNCEMENTS

Medicare Program: Changes to the Medicare Claims and Entitlement, Medicare Advantage Organization Determination, and Medicare Prescription Drug Coverage Determination Appeals Procedures

Summary: This final rule revises the procedures that the Department of Health and Human Services (HHS) follows at the Administrative Law Judge (ALJ) level for appeals of payment and coverage determinations for items and services furnished to Medicare beneficiaries, enrollees in Medicare Advantage (MA) and other Medicare competitive health plans, and enrollees in Medicare prescription drug plans, as well as appeals of Medicare beneficiary enrollment and entitlement determinations, and certain Medicare premium appeals. In addition, this final rule revises procedures that the Department of Health and Human Services follows at the Centers for Medicare & Medicaid Services (CMS) and the Medicare Appeals Council (Council) levels of appeal for certain matters affecting the ALJ level.

Recommendations to Providers Regarding Cyber Security

Summary: The Centers for Medicare & Medicaid Services (CMS) is reminding providers and suppliers to keep current with best practices regarding mitigation of cyber security attacks. We have outlined resources to assist facilities in their reviews of their cyber security and IT programs.

U.S. Department of Justice: Evaluation of Corporate Compliance Programs

Summary: The DOJ must evaluate corporate compliance programs in the specific context of a criminal investigation. In conducting an investigation of a corporate entity, determining whether to bring charges, and negotiating plea or other agreements, prosecutors should consider specific factors such as “the existence and effectiveness of the corporation’s pre-existing compliance program” and the corporation’s remedial efforts “to implement an effective corporate compliance program or to improve an existing one.” This document provides some important topics and sample questions that the Fraud Section (of the DOJ) has frequently found relevant in evaluating a corporate compliance program.

MOON Countdown: Definitions, FAQs and Resources
Published on Feb 28, 2017
20170228
 | Recovery Auditor 
 | Documentation 
 | Patient Status 

Hospitals are at T-7 days for the March 8, 2017 compliance date with the Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE Act). In the spirit of last minute preparations, this article is meant to reinforce key definitions, provide CMS responses to comments found in the 2017 IPPS Final Rule in the form of questions and answers and links to MOON resources.

 

Definitions

The MOON is intended to inform beneficiaries who receive observation services for more than 24 hours that they are outpatients receiving observation services and not inpatients, and the reasons for such status.

  • Outpatient Defined
    The Medicare Claims Processing Manual (Pub. 100-04), Chapter 1, Section 50.3.1, defines an Outpatient as “a person who has not been admitted as an inpatient but who is registered on the hospital or critical access hospital (CAH) records as an outpatient and receives services (rather than supplies alone) directly from the hospital or CAH.”
  • Observation Services
    Observation services are “services that are reasonable and necessary, specifically ordered by a physician or other nonphysician practitioner authorized by State licensure law and hospital staff bylaws to admit patients to the hospital or to order outpatient services, and meet other published Medicare criteria for payment.”

    “Individuals receiving observation services will always be registered as outpatients; however, not all outpatients receive observation services.”
  • Decision to order Observation Services
    “By definition… the reason for ordering observation services will always be the result of a physician’s decision that the individual does not currently require inpatient services and observation services are needed for the physician to make a decision regarding whether the individual needs further treatment as a hospital inpatient or if the individual is able to be discharged from the hospital.” (Source: 2017 IPPS Final Rule referencing the Medicare Benefits Policy Manual (Pub. 100-02), Chapter 6, Section 20.6.)

Questions and Answers

Again, CMS’ responses to comments from the 2017 IPPS Final Rule have been formatted as Questions and Answers.

Question: Several commenters requested clarification as to whether the timeframe starts:

  1. After services begin following the written order for observation services;
  2. When related services commence if such services commence before the written order was executed and the patient occupies an outpatient bed count; or
  3. Based on the documentation of when nursing care began.

Answer: CMS indicated “there may be times when an individual is subject to an order for observation services, but is not actually receiving observation services. For example, following an order for observation services in an emergency department, a hospital may need to wait to begin furnishing observation services until a bed is available for the patient. In this situation, services are considered initiated when observation services commence.”

They went on to clarify “that the start of observation services, for the purposes of determining when more than 24 hours of observation services have been received, is the clock time as documented in the patient’s medical record at which observation services are initiated (furnished to the patient) in accordance with a physician’s order.”

Question: Will time be counted as Billable or Elapsed Time?

Answer: CMS believes using elapsed time is most consistent with language in the NOTICE Act. “Therefore, for purposes of identifying the 24-hour timeframe for which an individual has received observation services, and thus is required by the NOTICE Act to receive notice by the hospital or CAH, observation time will be measured as the elapsed time in hours beginning at the clock time documented in the patient’s medical record, which coincides with the time that observation care is initiated in accordance with a physician’s order.”

Question: What if the Inpatient Admission occurs prior to delivery of the MOON?

Answer: As recommended by a commenter, CMS agrees that when “an inpatient admission occurs prior to delivery of the MOON, the MOON should be annotated with date and time of the inpatient admission. Therefore, we are requiring that, in the event that a patient is subsequently admitted as a hospital inpatient directly after receiving observation services for more than 24 hours, and the inpatient admission occurs prior to delivery of the MOON, the MOON be annotated with the date and time of the inpatient admission. Additional guidance regarding elements for the free text field of the MOON will be provided in the CMS Internet Only Manual.”

Question: How will the MOON work with the 2-Midnight Policy?

Answer: “The NOTICE Act requires hospitals to inform patients who have remained outpatients of the hospital and received observation services for more than 24 hours that they are not hospital inpatients and are subject to potentially different cost-sharing requirements and postacute care benefits than someone who has been admitted as an inpatient. We note that a scenario could arise whereby a patient is admitted to the hospital immediately after being a hospital outpatient receiving observation services for greater than 24 hours. In such a scenario, the inpatient admission may be payable under Medicare Part A under the 2-midnight policy and, as stated earlier, the hospital or CAH would still be required to furnish the MOON to the patient within 36 hours after the time the individual begins receiving observation services.”

Question: Can a Hospital or CAH deliver the MOON before an individual has received more than 24 hours of observation services as an inpatient?

Answer: Yes.

  • This affords hospitals flexibility to deliver the MOON consistent with any applicable state law requiring notice within 24hrs.

    Note: “Hospitals and CAHs subject to State law notice requirements may also attach an additional page to the MOON to supplement the “Additional Information” section in order to communicate additional content required under State law, or may attach the notice required under State law to the MOON.”
  • This allows hospitals and CAHs to spread out the delivery of the MOON and other hospital paperwork in an effort to avoid overwhelming and confusing beneficiaries.

    Note: CMS does not encourage delivery of the MOON at the initiation of outpatient observation services.

Question: Can the MOON form be altered?

Answer: No, because the MOON is a standard form approved by the Office of Management and Budget (OMB), Hospitals and CAHs are not permitted to alter the included language, only the information to be included in the free text fields.

The MOON must remain two pages, except as needed for the additional information field. The pages of the notice can be two sides of one page or one side of separate pages, but must not be condensed to one page.

Hospitals may include their business log and contact information on the top of the MOON. Text may not be shifted from page 1 to page 2 to accommodate large logos, address headers, or any other information.

Question: Can you use “drop down” boxes in the free text field for telling the patient why they are not an inpatient?

Answer: CMS indicates in the 2017 IPPS Final Rule, “We may consider, in the future, the other suggestions commenters made to improve the MOON, such as checkboxes with common reasons for the patient’s outpatient status or suggested narratives for insertion in this section.”

Question: If more space is needed for “Additional Information”, may a Hospital attach additional pages to the MOON?

Answer: Yes

Question: Can you (CMS) clarify the effect of a resident’s order for services on the counting of hours of observation care?

Answer: “To the extent that a resident is authorized by State licensure law and hospital staff bylaws to order outpatient services, once observation services are initiated in accordance with the resident’s order, the 24 hour time period will commence.”

Question: What do you do if the individual receiving the notice is unable to read its written contents and/or comprehend the required oral explanation?

Answer: As discussed in the proposed rule (81 FR 25134), an English language version of the proposed MOON was submitted to OMB for approval. We stated in the proposed rule that once we receive OMB approval, a Spanish language version of the MOON will be made available. If the individual receiving the notice is unable to read its written contents and/or comprehend the required oral explanation, we expect hospitals and CAHs to employ their usual procedures to ensure notice comprehension. (We refer readers, for example, to the Medicare Claims Processing Manual (Pub. 100–4), Chapter 30, Section 40.3.4.3., for similar existing procedures related to notice comprehension for the Advance Beneficiary Notice of Noncoverage (ABN).) Usual procedures may include, but are not limited to, the use of translators, interpreters, and assistive technologies. Hospitals and CAHs are reminded that recipients of Federal financial assistance have an independent obligation to provide language assistance services to individuals with limited English proficiency (LEP) consistent with section 1557 of the Affordable Care Act and Title VI of the Civil Rights Act of 1964. In addition, recipients of Federal financial assistance have an independent obligation to provide auxiliary aids and services to individuals with disabilities free of charge, consistent with section 1557 of the Affordable Care Act and section 504 of the Rehabilitation Act of 1973.”

Question: Does the beneficiary have appeal rights under the NOTICE Act?

Answer: No, “The MOON is a required informational/educational notice regarding patient status provided by a hospital or CAH when the beneficiary is still in the hospital or CAH and receives observation services as an outpatient for more than 24 hours. The MOON explains the current status of the patient as an outpatient and not an inpatient, in addition to the implications of being an outpatient receiving observation services. As we explained in the proposed rule, delivery of the MOON does not constitute an initial determination issued in response to a claim for benefits, and the MOON itself is not a notice of an initial determination (81 FR 25134). Furthermore, delivery of the MOON by a hospital or CAH does not constitute a denial of coverage of any services, and does not constitute a noncoverage decision with respect to post-hospital SNF care as asserted by the commenter. In fact, generally beneficiaries will still be receiving care when the MOON is delivered and will sometimes be formally admitted as inpatients after delivery of the MOON.

The NOTICE Act does not provide for appeal rights regarding the notice itself, which makes sense given the nature of the document, as explained above. The NOTICE Act also does not afford any new appeal rights beyond those already available (under section 1869 of the Social Security Act), nor does the NOTICE Act limit or restrict currently available appeal rights. Consistent with the legislation, the proposed rule did not propose to expand or limit appeal rights. For the reasons discussed above, we are not adopting the various recommendations with respect to amending the MOON to include appeal rights or an explanation of the lack of appeal rights.”

 

MOON and Condition Code 44

“In rare circumstances where a physician initially orders inpatient services, but following internal utilization review (UR) performed while the patient is hospitalized, the hospital determines that the services do not meet its inpatient criteria and the physician concurs with UR and orders the discontinuation of inpatient services and initiation of outpatient observation services (that is, a Condition Code 44 situation), we stated in the proposed rule that the MOON would be delivered as required by the NOTICE Act (when outpatient observation services have been ordered and furnished for more than 24 hours). If observation services are ordered when Condition Code 44 applies, the 24-hour time period for observation notification commences at the same time that observation services are initiated under a physician’s order, consistent with existing policy for observation services furnished to outpatients. (We refer readers to the Medicare Claims Processing Manual (Pub. 100–04), Chapter 1, Section 50.3.)

As discussed in the proposed rule and as stated in the notice announcing CMS Ruling CMS–1455–R (78 FR 16614), the Part B Inpatient Billing Ruling, in cases where reviewers find that an inpatient admission was not medically reasonable and necessary after the beneficiary is discharged, and thus, not appropriate for payment under Medicare Part A, the beneficiary’s patient status remains ‘‘inpatient’’ as of the time of the inpatient admission. The patient’s status is not changed to outpatient because the beneficiary was formally admitted as an inpatient, and there is no provision to change a beneficiary’s status after he or she is discharged from the hospital. Where CMS denies a claim after the beneficiary has been discharged because the inpatient admission was not medically reasonable and necessary, there would be no need to issue the MOON because the individual’s status remains inpatient, despite the fact that the inpatient admission was improper. Similarly, where a hospital determines through UR after a beneficiary is discharged that his or her inpatient admission was not reasonable and necessary and the hospital bills the services that were provided on a Medicare Part B claim, the NOTICE Act notification requirements would not apply for these individuals because their status would also remain inpatient.” (Excerpt from page 281-282 2017 IPPS Final Rule pdf document)

 

MOON Resources

Beth Cobb

January Medicare Transmittals and Other Updates
Published on Jan 31, 2017
20170131
 | Recovery Auditor 
 | Coding 
 | OIG 
 | Outpatient Services 
 | Patient Status 

TRANSMITTALS

 

Calendar Year (CY) 2017 Annual Update for Clinical Laboratory Fee Schedule and Laboratory Services Subject to Reasonable Charge Payment

Summary: Provides instructions for the Calendar Year (CY) 2017 clinical laboratory fee schedule, mapping for new codes for clinical laboratory tests, and updates for laboratory costs subject to the reasonable charge payment. This update applies to Chapter 16, Section 20 of the “Medicare Claims Processing Manual.”

April 2017 Quarterly Average Sales Price (ASP) Medicare Part B Drug Pricing Files and Revisions to Prior Quarterly Pricing Files

Summary: Provides the April 2017 quarterly update Average Sales Price (ASP) drug pricing files for Medicare Part B drugs.

Changes to the Laboratory National Coverage Determination (NCD) Edit Software for April 2017

Summary: Changes that will be included in the April 2017 quarterly release of the edit module for clinical diagnostic laboratory services.

Notice of New Interest Rate for Medicare Overpayments and Underpayments - 2nd Qtr Notification for FY 2017

Summary: Medicare Regulation 42 CFR Section 405.378 provides for the charging and payment of interest on overpayments and underpayments to Medicare providers. The Secretary of Treasury certifies an interest rate quarterly. The Medicare contractors shall implement an interest rate of 9.50 percent effective January 19, 2017 for Medicare overpayments and underpayments.

Medicare Outpatient Observation Notice (MOON) Instructions

Summary: Updates Chapter 30 of the “Medicare Claims Processing Manual” to include the Medicare Outpatient Observation Notice (MOON), CMS-10611, and related instructions. Providers should use the MOON to inform Medicare beneficiaries when they are an outpatient receiving observation services, and are not an inpatient of the hospital or a Critical Access Hospital (CAH). The instructions included in Chapter 30 provide guidance for proper issuance of the MOON.

OTHER MEDICARE ANNOUNCEMENTS

January 2017 Medicare Quarterly Provider Compliance Newsletter

Summary: Provides education on how to avoid common billing errors and other erroneous activities when dealing with the Medicare Fee-For-Service (FFS) Program. It includes guidance to help health care professionals address and avoid the top issues of the particular quarter. Hospital topics this quarter include facet joint injections, radiation therapy, stem cell transplants, and long-term acute care (LTAC) stays.

Final Rule: Revisions to the Office of Inspector General’s Exclusion Authorities

Summary: This final rule amends the regulations relating to exclusion authorities under the authority of the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS or the Department). The final rule incorporates statutory changes, early reinstatement provisions, and policy changes, and clarifies existing regulatory provisions.

Final Rule: Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model (CJR)

Summary: This final rule implements three new Medicare Parts A and B episode payment models, a Cardiac Rehabilitation (CR) Incentive Payment model and modifications to the existing Comprehensive Care for Joint Replacement model under section 1115A of the Social Security Act. Acute care hospitals in certain selected geographic areas will participate in retrospective episode payment models targeting care for Medicare fee-for-service beneficiaries receiving services during acute myocardial infarction, coronary artery bypass graft, and surgical hip/femur fracture treatment episodes. All related care within 90 days of hospital discharge will be included in the episode of care. We believe these models will further our goals of improving the efficiency and quality of care for Medicare beneficiaries receiving care for these common clinical conditions and procedures.

MOON Manual Instructions
Published on Jan 31, 2017
20170131
 | Recovery Auditor 
 | Quality 

Fall and spring are my favorite seasons. Summer is not so bad either. It’s the transition from winter to spring that can be a challenge. The December holidays are over. Most New Year’s Resolutions have gotten lost in the busy day to day of living. Here in the south the weather can be crazy with an ice storm one weekend, spring like weather the next week and then back into the deep freeze of winter.

The transition from a law consisting of less than four hundred words to implementation of the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act is proving to be a difficult transition too.

NOTICE Act to MOON Implementation Timeline

  • August 6, 2015: NOTICE Act signed into law
  • August 6, 2016: Effective date for compliance with the law
  • August 22, 2016: With the release of the 2017 IPPS Final Rule, implementation was delayed due to the Medicare Outpatient Observation Notice (MOON) being open to public comment and having to go through the Paperwork Reduction Act (PRA).
  • December 8, 2016: Final MOON posted to the CMS Beneficiary Notices Initiatives (BNI) webpage with a note that Manual Instructions were to be made available in the coming weeks.
  • January 11, 2017: CMS Open Door Forum (ODF). A caller asked for clarification on what they would expect to see on the MOON as the reason the beneficiary is not an inpatient. CMS did not provide an answer and instead instructed hospitals to look for the Manual Instructions to be released in the coming weeks.
  • January 20, 2017: Transmittal 3695: Subject: MOON Instructions issued.
  • March 8, 2017: Hospitals and Critical Access Hospitals (CAHs) are required to begin providing the MOON no later than this date.

This article highlights the detailed instructions that were issued in Transmittal 3695 that updates the Medicare Claims Processing Manual, Chapter 30 – Financial Liability Protections, section 400 – Part A Medicare Outpatient Observation Notice.

400.2- Scope

Who should receive the MOON? The MOON is to be given to beneficiaries who have been receiving observation services for more than 24 hours. It must be provided no later than 36 hours after the observation services began. The distinction on determining who receives the MOON is if the beneficiary is entitled to Medicare benefits, not if Medicare makes a payment. Specifically, this would include the following:

  • The individual enrolled in Medicare Part A and Part B,
  • The individual enrolled in Medicare Part A only “would still receive notice even though the observation services received as an outpatient fall under the Part B benefit and would not be covered or payable by Medicare for that person,”
  • Individuals enrolled in a Medicare Advantage (MA) or other Medicare health plan, and
  • Individuals where Medicare or MA is the secondary payer. CMS notes “the applicability of the notice requirement depends on whether the individual is entitled to benefits under Title XVIII, not on whether Medicare makes payment (primary or otherwise).”

Timing of Delivery of the MOON: CMS is allowing delivery of the MOON prior to 24 hrs to “afford hospitals and CAHs the flexibility to deliver the MOON consistent with any applicable State law that requires notice to outpatient receiving observation services within 24 hours after observation services begins.”

400.3 – Medicare Outpatient Observation Notice

The MOON is subject to the PRA process and approval by the OMB. The MOON has accompanying instructions that can be found along with the MOON on the CMS BNI web page. Manual instructions advise the following:

  • The MOON may only be modified by its accompanying instructions and guidance in the Medicare Claims Processing Manual, Chapter 30.
  • Unapproved modifications cannot be made to the OMB-approved, standardized MOON.

400.3.1 – Alterations to the MOON

  • The MOON is two pages in length and must remain so unless additional information or state-specific information results in additional page(s).
  • The MOON can be two sides of one page or one side of separate pages. However, it “must not be condensed to one page.”
  • Hospitals are allowed to include their hospital logo and contact information at the top of the MOON. However, the text on page 1 of the MOON “may not be shifted from page 1 to page 2 to accommodate large logos, address headers, or any other information.”

400.3.2 – Completing the MOON

“Hospitals must use the OMB-approved MOON (CMS-10611). Hospitals must type or write the following information in the corresponding blanks of the MOON:

  • Patient name;
  • Patient number; and
  • Reason patient is an outpatient.”

MOON Pain Point: Why is Your Patient Not an Inpatient?

Earlier I indicated that during the January 11, 2017 CMS ODF a caller asked for clarification of what CMS would expect to see as the reason a patient is an outpatient and not an inpatient. Unfortunately, above I have included this entire section of the manual instructions, leaving hospitals with an unanswered question and a March 8, 2017 compliance date.

For those reading this that are still developing your internal processes for this new requirement, here are a few resources for consideration as to what CMS has said about why a physician would order observation services.

  • “By definition…the reason for ordering observation services will always be the result of a physician’s decision that the individual does not currently require inpatient services and observation services are needed for the physician to make a decision regarding whether the individual needs further treatment as a hospital inpatient or if the individual is able to be discharged from the hospital.” (Medicare Benefits Policy Manual (Pub. 100-02), Chapter 6, Section 20.6)
  • CMS indicated in the 2017 IPPS Final Rule that they “may consider, in the future, the other suggestions commenters made to improve the MOON, such as checkboxes with common reasons for the patient’s outpatient status or suggested narratives for insertion in this section.”
  • In the official U.S. government Medicare handbook, Medicare and You 2017, CMS tells the beneficiary that “staying overnight in a hospital doesn’t always mean you’re an inpatient. You only become an inpatient when a hospital formally admits you as an inpatient, after a doctor orders it. You’re still an outpatient if you haven’t been formally admitted as an inpatient, even if you’re getting emergency department services, observation services, outpatient surgery, lab tests, or X-rays.”
  • CMS Product No. 11435, Are You a Hospital Inpatient or Outpatient? content is like an unabridged version of the MOON and reinforces the fact that observation services are provided to help the doctor decide if a patient needs to be admitted or can be discharged.

So, why is your patient not an inpatient? There are basically two reasons. Either your doctor expects you will need hospital care less than two midnights or because you’re Medicare Advantage Plan has advised that the stay should be observation. What you put on the MOON will be a decision to be made as part of the implementation process plan at your hospital.

400.3.3 – Hospital Delivery of the MOON

Hospitals are to deliver a written MOON, as well as provide oral notification.

Oral Notification must:

  • Consist of an explanation of the standardized written MOON.
  • The format for oral notification is at the discretion of the hospital or CAH.
  • The format may include, but is not limited to, a video format.
  • No matter the format, a staff member must always be available to answer questions related to the MOON in its written and oral delivery formats.

Signature Requirement

The beneficiary or his/her representative must sign and date the MOON “to demonstrate that the beneficiary or representative received the notification and understands its contents. Use of assistive devices may be used to obtain a signature.”

Delivery of the MOON

  • A hospital can issue the MOON in electronic format for signing. However, the beneficiary must be given the option of requesting a paper copy to sign if they prefer.
  • Regardless of digital or paper form and signature, “the beneficiary must be given a paper copy of the MOON.

400.3.4 – Required Delivery Timeframes

  • The MOON must be delivered when the beneficiary has received observation services as an outpatient for more than 24 hours.
  • The MOON must be delivered no later than 36 hours after observation services began.
  • If a beneficiary is transferred, discharged, or admitted the MOON must be delivered before 36 hours.
  • The MOON may be delivered before receiving 24 hours of observation services.

Observation Start Time

For purposes of delivering the MOON, the start time “is the clock time observation services are initiated (furnished to the patient)…in accordance with a physician’s order.

Elapsed Time

Again, for purposes of delivering the MOON, time is to be measured as elapsed time beginning at the time in the record when services began in accordance with the order for observation rather than billable observation time.

400.3.5. – Refusal to Sign the MOON

When a beneficiary refuses to sign the MOON and there is no representative to sign on behalf of the beneficiary the following guidance is to be followed:

  • The MOON must be signed by the staff member presenting the written notification.
  • The signature must include their name, title, and a certification that the notification was presented, and the date and time it was presented.
  • The staff member would annotate the “Additional Information” section of the MOON to include their signature and certification of the delivery.
  • The date and time of refusal is considered the date of notice receipt.

400.3.6 – MOON Delivery to Representative

  • The MOON may be delivered to a beneficiary’s appointed representative or authorized representative.
  • If the MOON is delivered to a “representative who has not been named in a legally binding document, the hospital or CAH annotates the MOON with the name of the staff person initiating the contact, the name of the person contacted, and the date, time and method (in person or telephone) of the contact.”

Exception: Delivery to a representative not physically present to receive delivery of the notice.

If this exception occurs the hospital must:

  • Complete the MOON as required and telephone the representative,
  • Information provided telephonically includes all contents of the MOON,
  • The date and time the hospital communicates or makes a good faith attempt to communicate the information is considered the receipt date of the MOON,
  • The hospital would need to annotate the “Additional Information” section to reflect that all of the indicated information was communicated, and
  • The hospital would need to annotate the “Additional Information” section with the name of the staff person initiating the contact, the name of the representative contacted by phone, the date and time of the telephone contact and the telephone number called.

Specific guidance on mailing a copy to the representative is in the manual instructions. The important thing to note is that CMS indicates that “the burden is on the hospital or CAH to demonstrate that timely contact was attempted with the representative and that the notice was delivered.”

400.3.7 – Ensuring Beneficiary Comprehension

The standardized MOON is available in English and Spanish. If the beneficiary is unable to read and/or comprehend the required oral explanation, “hospitals and CAHs must employ their usual procedures to ensure notice comprehension.” Usual procedures may include:

  • Translators,
  • Interpreters, and
  • Assistive technologies.

400.3.8 – Completing the Additional Information Field of the MOON

CMS instructs that this section may be populated with any additional information a hospital wishes to convey to a beneficiary. CMS specific examples of what may be put in this section include:

  • Contact information for specific hospital departments or staff members.
  • Additional content required under applicable State law related to notice of observation services.
  • Part A cost-sharing responsibilities if a beneficiary is admitted as an inpatient before 36 hours following initiation of observation services.
  • The date and time of the inpatient admission if a patient is admitted as an inpatient prior to delivery of the MOON.
  • Medicare Accountable Care Organization information.
  • Hospital waivers of the beneficiary’s responsibility for the cost of self-administered drugs.
  • Any other information pertaining to the unique circumstances regarding the particular beneficiary.

CMS will allow hospitals to attach additional pages to the MOON when more room is needed.

400.3.9 – Notice Retention of the MOON

  • The hospital or CAH must retain the original signed MOON in the beneficiary’s medical record.
  • Electronic notice retention is permitted.
  • The beneficiary is to receive a paper copy of the MOON that includes all of the required information.

400.4 – Intersection with State Observation Notices

“States that have State-specific observation notice requirements may add State-required information to the “Additional Information” field, attach an additional page, or attach the notice required under State law to the MOON.”

MMP, Inc. strongly encourages hospitals to closely review the MOON form instructions found on the BNI webpage as well as the Manual instructions to ensure compliance with the NOTICE Act. 

Beth Cobb

November Medicare Transmittals and Other Updates
Published on Nov 29, 2016
20161129
 | Billing 
 | Coding 
 | OIG 
 | Outpatient Services 
 | Recovery Auditor 

TRANSMITTALS

New Physician Specialty Code for Hospitalist

Summary: The Centers for Medicare and Medicaid Services (CMS) has established a new physician specialty code for Hospitalist (C6).

Modifications to the National Coordination of Benefits Agreement Crossover Process

Summary: Modifies the Part A shared system to ensure that all 837 institutional Coordination of Benefits (COB) claims will contain a Claim Adjustment Reason Code and Remittance Advice Remark Code combination, that hospital day counts may not be entered duplicatively on incoming claims submissions to Medicare, and that Present on Admission (POA) indicators are only permitted on incoming inpatient hospital-oriented claims.

Instructions to Process Services Not Authorized by the Veterans Administration (VA) in a Non-VA Facility Reported with Value Code (VC) 42

Summary: Clarifies how Medicare contractors shall process inpatient claims for services in a Non-VA facility that were not authorized by the VA.

Issuing Compliance Letters to Specific Providers and Suppliers Regarding Inappropriate Billing of Qualified Medicare Beneficiaries (QMBs) for Medicare Cost-Sharing

Summary: Federal law bars Medicare providers from charging individuals enrolled in the Qualified Medicare Beneficiary Program (QMB) for Medicare Part A and B deductibles, coinsurances, or copays. Change Request (CR) 9817 instructs MACs to issue a compliance letter instructing named providers and suppliers to refund any erroneous charges and recall any past or existing billing with regard to improper QMB billing.

Therapy Cap Values for Calendar Year (CY) 2017

Summary: Describes the amounts and policies for outpatient therapy caps for CY 2017. For physical therapy and speech-language pathology combined, the 2017 therapy cap will be $1,980. For occupational therapy, the cap for 2017 will be $1,980.

Quarterly Update to the Correct Coding Initiative (CCI) Edits, Version 23.0, Effective January 1, 2017

Summary: Instructs MACs of the normal update to the Correct Coding Initiative (CCI) Procedure to Procedure (PTP) edits, effective January 1, 2017.

Payment Reduction for X-Rays Taken Using Film

Summary: Reduces the technical component (TC) (including the TC portion of a global service) of X-ray imaging services provided using film.

2017 Annual Update to the Therapy Code List

  • MLN Matters®Number: MM9782
  • Related Change Request (CR) #: CR 9782
  • Related CR Release Date: November 10, 2016
  • Effective Date: January 1, 2017
  • Related CR Transmittal #: R3654CP
  • Implementation: January 3, 2017
  • Affects physicians, therapists, and other providers, including Comprehensive Outpatient Rehabilitation Facilities (CORFs), submitting claims to Medicare Administrative Contractors (MACs), including Home Health & Hospice MACs, for outpatient therapy services provided to Medicare beneficiaries.
  • https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM9782.pdf

Summary: Updates the therapy code list for Calendar Year (CY) 2017 by adding eight “always therapy” codes (97161 – 97168) for physical therapy (PT) and occupational therapy (OT) evaluative procedures and deletes the four codes currently used to report these services (97001 – 97004).

ICD-10 Coding Revisions to National Coverage Determination (NCDs)

Summary: The 10th maintenance update of ICD-10 conversions and other coding updates specific to national coverage determinations (NCDs). These NCD coding changes are the result of newly available codes, coding revisions to NCDs released separately, or coding feedback received.

Annual Update of HCPCS Codes Used for Home Health Consolidated Billing Enforcement

Summary: 2017 annual update to the list of HCPCS codes used by Medicare systems to enforce consolidated billing of home health services.

Office of Inspector General Report: Stem Cell Transplantation

Summary: Addresses issues of incorrect billing as a result of the February 2016 OIG report and clarifies coverage of stem cell transplantation.

 

MEDICARE HOSPITAL PAYMENT RULES

Hospital Inpatient Prospective System (IPPS) Final Rule Correction Notice

Summary: This document corrects a typographical error in the final rule that appeared in the August 22, 2016 Federal Register as well as additional typographical errors in a related correction to that rule that appeared in the October 5, 2016 Federal Register.

Hospital Outpatient Prospective System (OPPS) and ASC Final Rule

Summary: This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2017 to implement applicable statutory requirements and changes arising from CMS’s continuing experience with these systems.

 

OTHER MEDICARE ANNOUNCEMENTS

2017 Medicare Parts A & B Premiums and Deductibles Announced

Summary: The 2017 premiums for the Medicare inpatient hospital (Part A) and physician and outpatient hospital services (Part B) programs.

New Recovery Auditor Contracts Awarded

  • October 31, 2016 – CMS has awarded the next round of Medicare Fee-for-Service Recovery Audit Contractor (RAC) contracts to:
  • Region 1 – Performant Recovery, Inc.
  • Region 2 – Cotiviti, LLC
  • Region 3 – Cotiviti, LLC
  • Region 4 – HMS Federal Solutions
  • Region 5 – Performant Recovery, Inc
  • RAC Recent Updates webpage

The RACs in Regions 1-4 will perform postpayment review to identify and correct Medicare claims that contain improper payments (overpayments or underpayments) that were made under Part A and Part B, for all provider types other than Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) and Home Health/Hospice. The Region 5 RAC will be dedicated to the postpayment review of DMEPOS and Home Health/Hospice claims nationally.

CMS Hospital Value-Based Purchasing Program Results for Fiscal Year 2017

  • November 1, 2016
  • Adjustments to Medicare hospital payments based on the quality of care they provide to patients as determined by quality reporting
  • 2017 VBP Fact Sheet
  • Includes link to FY2017 Hospital VBP incentive payment adjustment factors

Fiscal Year 2017 HHS OIG Work Plan

Summary: The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) Work Plan for fiscal year (FY) 2017 summarizes new and ongoing reviews and activities that OIG plans to pursue with respect to HHS programs and operations during the current fiscal year and beyond.

IPPS FY 2017 Final Rule: MS-DRG Updates
Published on Aug 23, 2016
20160823
 | Recovery Auditor 
 | Coding 
 | Documentation 

“The only way to make sense out of change is to plunge into it, move with it, and join the dance.”- Alan Watts

This week we conclude our in-depth analysis of the 2017 IPPS Final Rule by taking a plunge into finalized changes to Medicare Severity Diagnosis-Related Group (MS-DRG) Classifications broken down by Major Diagnostic Categories (MDCs).

 

Pre-Major Diagnostic Category (Pre MDC)

Total Artificial Heart Replacement

The proposal to assign ICD-10-PCS procedure codes 02RK0JZ and 02RL0JZ as a code cluster to ICD–10 Version 34 MS–DRGs 001 and 002 (Heart Transplant or Implant of Heart Assist System with and without MCC, respectively) to accurately replicate the Version 32 ICD–9–CM based MS–DRG logic of procedure code 37.52 was finalized.

MDC1: Diseases and Disorders of the Nervous System

Mechanical Complication Codes

In the proposed rule CMS agreed with a requestor that ICD-10-CM diagnosis codes T85.610A, T85.620A, T85.630A, and T85.690A describe conditions occurring within the nervous system. These ICD-10 diagnosis codes describe concepts not previously captured by the ICD-9-CM. As a result, CMS finalized the reassignment of these four ICD–10–CM diagnosis codes from MDC 21 under MS–DRGs 919, 920, and 921 to MDC 1 under MS–DRGs 091, 092, and 093. The official code titles were revised after publication of the Proposed Rule. The new ICD-10 code titles are as follow:

 

CodeNew Code Descriptions
T85.610ABreakdown (mechanical) of cranial or spinal infusion catheter, initial encounter
T85.620ADisplacement of cranial or spinal infusion catheter, initial encounter
T85.630ALeakage of cranial or spinal infusion catheter, initial encounter
T85.690AOther mechanical complication of cranial or spinal infusion catheter, initial encounter

 

MDC 4: Diseases and Disorders of the Ear, Nose, Mouth and Throat

Reassignment of Diagnosis Code R22.2

The proposal to reassign ICD–10–CM diagnosis code R22.2 (Localized Swelling, Mass and Lump, Trunk) from MDC 4 to MDC 9 under MS–DRGs 606 and 607 (Minor Skin Disorders with and without MCC, respectively) was finalized.

 

MDC 5: Diseases and Disorders of the Circulatory System

Implant of Loop Recorder

The proposal to re-designate the following four ICD–10–PCS codes from non-O.R. to O.R. procedures within Appendix E of the Version 34 ICD–10 MS–DRG Definitions Manual was finalized.

  • 0JH602Z (Insertion of monitoring device into chest subcutaneous tissue and fascia, open approach);
  • 0JH632Z (Insertion of monitoring device into chest subcutaneous tissue and fascia, percutaneous approach);
  • 0JWT02Z (Revision of monitoring device in trunk subcutaneous tissue and fascia, open approach); and
  • 0JWT32Z (Revision of monitoring device in trunk subcutaneous tissue and fascia, percutaneous approach).

Endovascular Thrombectomy of the Lower Limbs

CMS agreed with a commenter that procedures describing endovascular thrombectomy of the lower limbs should be assigned to ICD–10 MS–DRGs 270, 271, and 272. CMS finalized their proposal to restructure the ICD–10–PCS MS–DRG configuration and add 20 of the proposed ICD–10–PCS code translations (which would capture procedures describing endovascular thrombectomy of the lower limbs) to ICD–10–PCS Version 34 (The code table can be found on page 56804 of the final rule.)

Pacemaker Procedure Codes Combinations

The proposal to modify the ICD-10 MS-DRG logic to capture a wider range of possible reported procedure codes describing procedures involving both a pacemaker device and leads was finalized.

Transcatheter Mitral Valve Repair with Implant

Proposals finalized:

  • Collapse MS-DRGs 228, 229, and 230 from three severity levels by deleting MS-DRG 230 and revising MS-DRG 229,
  • ICD-9-CM procedure code 35.97 and the cases reporting ICD-10-PCS procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach) will be reassigned from MS–DRGs 273 and 274 to MS–DRG 228 and revised MS–DRG 229,
  • The title of revised MS-DRG 229 is now “Other Cardiothoracic Procedures without MCC”; and
  • The title for MS–DRG 228 will remain “Other Cardiothoracic Procedures with MCC.”

 

MDC 6: Diseases and Disorders of the Digestive System

Excision of Ileum

CMS received a request to analyze an MS-DRG replication issue. Under ICD–9, procedure code 45.62 (Other partial resection of small intestine) was assigned to MS–DRGs 329, 330 and 331 (Major Small and Large Bowel Procedures with MCC, with CC, and without CC/MCC, respectively).

Under the current ICD–10 MS–DRGs Version 33, ICD–10–PCS procedure code 0DBB0ZZ (Excision of ileum, open approach) is assigned to MS–DRGs 347, 348, and 349 (Anal and Stomal Procedures with MCC, with CC, and without CC/MCC, respectively). The requestor indicated that, despite the variation in terms for ‘‘excision’’ and ‘‘resection’’ between the two code sets, the surgical procedure to remove a portion of the small intestine, whether it is the ileum, duodenum, or jejunum, has not changed and should not result in different MS–DRG assignments when translated from ICD–9–CM to ICD–10. CMS agreed that this is a replication error.

Additionally, CMS reviewed the MS–DRG assignments for ICD–10–PCS code 0DBA0ZZ (Excision of jejunum, open approach) and determined the MS–DRG assignment for this code resulted in the same replication error.

As a result of analysis, CMS proposed and finalized the reassignment of ICD–10–PCS codes 0DBB0ZZ and 0DBA0ZZ from MS–DRGs 347, 348, and 349 (Anal and Stomal Procedures with MCC, with CC, and without CC/MCC, respectively) to MS–DRGs 329, 330, and 331 (Major Small and Large Bowel Procedures with MCC, with CC, and without CC/MCC, respectively), effective with the ICD–10 MS–DRGs Version 34 on October 1, 2016.

 

MDC 7: Diseases and Disorders of the Hepatobiliary System and Pancreas

Bypass Procedures of the Veins

A requestor noted that currently, ICD–10–PCS procedure code 06183DY (Bypass portal vein to lower vein with intraluminal device, percutaneous approach) is assigned to only MDC 5 (Diseases and Disorders of the Circulatory System) and MS–DRGs 270, 271, and 272 (Other Major Cardiovascular Procedures with MCC, with CC, and without CC/MCC, respectively) under ICD–10 MS–DRGs Version 33.

The requestor stated that the code should also be assigned to MDC 7 and MS–DRGs 405, 406, and 407 to be consistent with the ICD–9–CM MS–DRGs Version 32. CMS analyzed this issue and agreed and finalized the assignment of ICD–10–PCS procedure code 06183DY to MDC 7 and MS–DRGs 405, 406, and 407 for FY 2017.

 

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

Combination Codes for Removal and Replacement of Knee Joints

CMS examined knee joint revision combination codes that are not currently assigned to MS–DRGs 466, 467, and 468 (Revision of Hip or Knee Replacement with MCC, with CC, and without CC/MCC, respectively) in ICD–10 MS–DRGs Version 33 and identified 58 additional combinations that also should be included so that the same logic is used in the ICD–10 version of the MS–DRGs as is used in the ICD–9–CM version. CMS finalized the addition of these 58 new code combinations that capture the joint revisions to the Version 34 MS DRG structure for MS–DRGs 466, 467, and 468, effective October 1, 2016. The table of new combination codes begins on page 56821 of the Final Rule.

Decompression Laminectomy

Currently, under ICD–10–PCS, the procedure describing a decompression laminectomy is coded for the ‘‘release’’ of a specified area of the spinal cord. These decompression codes are assigned to MS–DRGs 028, 029, and 030 (Spinal Procedures with MCC, with CC or Spinal Neurostimulators, or without CC/MCC, respectively) and to MS–DRGs 518, 519, and 520 (Back and Neck

Procedures Except Spinal Fusion with MCC or Disc Device or Neurostimulator, with CC, or without CC/MCC, respectively) in the ICD–10 MS–DRGs Version 33.

A commenter brought attention to the fact that codes describing release of specific peripheral nerve are assigned to MS–DRGs 515, 516, and 517 (Other Musculoskeletal System and Connective Tissue O.R. Procedures with MCC, with CC, and without C/MCC, respectively). The commenter suggested that a subset of these codes also be assigned to MS–DRGs 028 through 030 and MS–DRGs 518 through 520 for clinical coherence purposes.

CMS agreed with the commenter’s suggestion and CMS proposed to reassign 18 ICD–10–PCS procedure codes from MS–DRGs 515 through 517 to MS–DRGs 028 through 030 and MS–DRGs 518 through 520 under the ICD–10 MS–DRGs Version 34.

This change was delayed in the Final Rule, “until the ICD-10 claims data are available, because we will have the ability to better analyze the impact of reassigning the specified codes according to their anatomic locations, as well as receive clarification regarding which specific codes should be taken under consideration for reassignment.”

Lordosis

A replication issue involving four diagnosis codes related to lordosis (excessive curvature of the lower spine) was discovered in MS-DRGs 446,457, and 458 (Spinal Fusion Except Cervical with Spinal Curvature or Malignancy or Infection or Extensive Fusions with MCC, with CC, and without CC/MCC).

These MS–DRGs contain specific logic requiring a principal diagnosis describing a spinal curvature, a malignancy, or infection or a secondary diagnosis that describes a spinal curvature disorder related to another condition.

Under the ICD–10 MS–DRGs Version 33, the following diagnosis codes were listed on the principal diagnosis list and the secondary diagnosis list for MS–DRGs 456, 457, and 458:

After consideration CMS finalized maintaining these four codes in the logic for the principal diagnosis list but to remove them from the secondary diagnosis list.

 

MDC 13: Diseases and Disorders of the Female Reproductive System

Pelvic Evisceration

Current GROUPER logic for MS–DRGs 332, 333, and 334 (Rectal Resection with MCC, with CC and without CC/MCC, respectively) under MDC 6 (Diseases and Disorders of the Digestive System) and for MS–DRGs 734 and 735 (Pelvic Evisceration, Radical Hysterectomy and Radical Vulvectomy with CC/MCC and without CC/MCC, respectively) under MDC 13 (Diseases and Disorders of the Female Reproductive System) include a ‘‘cluster’’ of ICD–10–PCS procedure codes that describe pelvic evisceration.

A ‘‘cluster’’ is the term used to describe a circumstance when a combination of ICD–10–PCS procedure codes is needed to fully satisfy the equivalent meaning of an ICD–9–CM procedure code for it to be considered a plausible code translation.

Under ICD–10–PCS, users are instructed to code separately the organs or structures that are actually removed and for which there is a distinctly defined body part. Therefore, the case of a patient who undergoes a pelvic evisceration (exenteration) that involves the removal of the sigmoid colon and rectum would have each of those procedure sites (sigmoid colon and rectum) coded and reported separately (in addition to the procedure codes displayed in the cluster). In this scenario, if the principal diagnosis is a condition from the MDC 6 diagnosis list, the case would group to MS–DRGs 332, 333, and 334, regardless of the code cluster. In other words, it would not be necessary to retain the code cluster describing procedures performed on female pelvic organs in MDC 6.

Therefore, CMS proposed and finalized removing the procedure code cluster for pelvic evisceration procedures from MDC 6 under the ICD–10 MS–DRGs Version 34. The cluster would remain in ICD–10 MDC 13 under MS–DRGs 734 and 735 only.

 

MDC 19: Mental Diseases and Disorders

CMS finalized the proposal to the title of MS-DRG 884 (Organic Disturbances and Mental Retardation) to “MS-DRG 884 (Organic Disturbances and Intellectual Disability)” to reflect the current terminology to describe the condition.

 

MDC 23: Factors Influencing Health Status and Other Contacts with Health Services

Logic of MS-DRGs 945 and 946 (Rehabilitation with CC/MCC and without CC/MCC, respectively)

CMS received several requests to examine the Grouper logic for MS-DRGs 945 and 946. The requestors were concerned that ICD–9–CM codes that clearly identified an encounter for rehabilitation services such as procedure codes V57.89 (Care involving other specified rehabilitation procedure) and V57.9 (Care involving unspecified rehabilitation procedure) were not included in ICD–10–CM Version 33. In addition, the requestors pointed out that ICD–10–CM has significantly changed the guidelines for coding of admissions/encounters for rehabilitation.

In a Final Rule response CMS indicates that they “agree with the commenters that the issue of any updates to ICD–10–PCS guidelines should be considered along with any proposed MS–DRG updates because updated guidelines may impact code reporting. We welcome any suggestions on how to update the ICD–10–PCS guidelines. These suggestions should be sent to ICDProcedureCodeRequest@cms.hhs.gov. We plan to take any proposed ICD–10–PCS rehabilitation guideline updates to a future meeting of the ICD–10 Coordination and Maintenance Committee so that the public can provide input on any new rehabilitation guideline.”

 

As mentioned at the start, this article highlights MDC specific MS-DRG changes. This is a small dive into the coding changes found in the Final Rule. MMP, Inc. encourages you to review the Final Rule and to be on the lookout for our Annual Fall Inpatient Webinar focused on Coding Changes in October. 

Beth Cobb

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