How to Ensure You Receive the Correct Inpatient Reimbursement

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  • December 16, 2016
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How to Ensure You Receive the Correct Inpatient Reimbursement

In inpatient auditing, you are auditing ICD-10-CM diagnosis codes, ICD-10-PCS procedures codes, and much more. The purpose of inpatient auditing is to ensure that the correct DRG was assigned.
All of the following factors play a role in making sure the correct inpatient reimbursement is received:
1. Assignment of the principal diagnosis – If you assign all of the correct diagnosis codes, but select the incorrect one for the principal diagnosis, the wrong MS-DRG will be assigned.
2. Assignment of major complications or comorbidities (MCC) – It is vital to ensure that the coding guidelines are followed to capture all relevant diagnoses that make up major complications and comorbidities. Incorrect assignment of MCCs will group the admission into the wrong MS-DRG and result in incorrect reimbursement.
3. Assignment of procedures codes – Assignment of ICD-10-PCS codes group an admission into an MS-DRG category. Coding a procedure with the wrong approach or root operation will cause a shift in the MS-DRG assignment. Coders should also be aware that some procedures routinely performed in surgical cases will cause an admission to be grouped into a higher MS-DRG. For example, if the surgeon starts an arterial cutdown as a means to administer IV fluids, they may elevate the DRG.
4. Maintain knowledge of AHA Coding Clinics – Coders need to read all of the AHA Coding Clinics that pertain to the diagnoses and procedure codes they assign. Review the Coding Clinic when the admission is grouped into a MS-DRG that is higher than expected. For example, it may not be appropriate to report those procedures routinely done for surgeries. Follow the Coding Clinic guidelines.
5. Assignment of Present on Admission (POA) indicators – Coders need to review all diagnoses and assign POA indicators for all conditions that were present on admission. This helps to determine which diagnoses developed while the patient was hospitalized. Hospital acquired conditions (HACs) decrease the reimbursement that is payable to the hospital.
6. Assignment of Discharge Status – It is critical the discharge status is assigned correctly. If a patient is discharged to a “post acute” setting, the hospital will be paid a post acute DRG, which is a lower amount than the corresponding MS-DRG. This affects transfer to SNFs and even to Home Healthcare.
7. Maintain knowledge of the OIG Work Plan – The OIG issues a Work Plan every year. The Work Plan identifies DRGs that are highly prone to incorrect DRG assignment. Coders should understand how to correctly ensure these DRGs are not coded incorrectly.
OIG Work Plan
Medicare Claims Processing Manual – Chapter 3 – Inpatient Hospital Billing
AHIMA – DRG Grouping and ICD-10 CM/PCS

Certified Inpatient Coder CIC

About Has 4 Posts

Karen D. Chappell, EJD, MBA, CHC, CCS, CIRCC, CPMM, LPN Ms. Chappell has 25 years of outpatient compliance audit experience, CDM maintenance review, and Revenue Integrity operations experience. She is a leading subject-matter expert in CMS and OIG regulations. Ms. Chappell is a coding education and curriculum writing consultant.

No Responses to “How to Ensure You Receive the Correct Inpatient Reimbursement”

  1. Andrew says:

    Bullet points 1 and 3 are not completely accurate