The FY 2010 IPPS changes impacting case managers

On July 31, the Centers for Medicare and Medicaid Services (CMS) released the FY 2010 Inpatient Prospective Payment System (IPPS) Final Rule. Hospital payment rates will increase by an average of 2.1%, as opposed to the 0.2% proposed earlier in the year. CMS elected not to implement a 1.9% reduction, referred to as the coding and documentation adjustment. This coding and documentation adjustment accounts for changes in clinical documentation and coding patterns—not real changes in patient acuity.

Implications for case managers

The start of the Medicare Fiscal Year IPPS, which begins each October 1, brings a host of new coding, payment, and other regulatory changes including updated relative weights for the 745 MS-DRGs. Some MS-DRG relative weights increase—others decrease. Relative weights are a proxy for patient acuity. Higher relative weights signify higher acuity, providing for a higher level of reimbursement, while lower relative weights translate into lower acuity with less reimbursement.

In reviewing the Healthcare Financial Management Association’s (HFMA) recent overview of the Final 2010 IPPS Rule, an interesting point was made that certainly impacts hospitals and case managers. We are all familiar with the Commission for Case Management Certification’s case management definition:

Case management is a collaborative process that assesses, plans, implements, coordinates, monitors, and evaluates the options and services required to meet the client’s health and human service needs. It is characterized by advocacy, communication, and resource management and promotes quality and cost-effective interventions and outcomes. (Emphasis added)

A major role of a hospital inpatient case manager is to focus on moving the patient along the inpatient continuum to the most clinically appropriate level of care, all while insuring a timely and safe discharge with emphasis on reducing the likelihood of readmissions. Moving the patient along the continuum of care entails monitoring and managing hospital resources and being proactive in managing length of stay.

A good practice of case management is to be familiar with reimbursement changes that occur each October 1. With this in mind, I call your attention to two key slides that appeared in the above-mentioned HFMA presentation. The first key slide pointed out that 24 of the 745 MS-DRGs account for 36.4% of Medicare’s 11.2 million annual discharges. CMS considers these MS-DRGs “High Volume MS-DRGs”—100,000 discharges or more. For FY 2010, CMS assigned 14 of these high-volume MS-DRGs to a lower relative weight, and assigned 10 MS-DRGs to a higher relative weight.

The following MS-DRGs represent high volume MS-DRGs with reduced relative weights for FY 2010:

• MS-DRG 190- COPD with MCC
• MS-DRG 683- Renal Failure
• MS-DRG 293- Heart Failure and Shock w/o CC/MCC
• MS-DRG 292- Heart Failure and Shock with CC
• MS-DRG 195- Simple Pneumonia and Pleurisy w/o CC/MCC
• MS-DRG 310- Cardiac Arrhythmia & Conduction Disorders w/o CC/MCC
• MS-DRG 378- GI Hemorrhage with CC
• MS-DRG 65- Intracranial Hemorrhage or Cerebral Infarction with CC
• MS-DRG 191- COPD with CC
• MS-DRG 392- Esophagitis, Gastroenteritis, and Miscellaneous Digestive Disorders w/o MCC
• MS-DRG 192- COPD w/o CC/MCC
• MS-DRG 194- Simple Pneumonia and Pleurisy with CC
• MS-DRG 189- Pulmonary Edema and Respiratory Failure
• MS-DRG 247- Percutaneous Cardiovascular Procedures with Drug Eluding Stent w/o MCC

The following MS-DRGs represent high volume MS-DRGs with increased relative weights for FY 2010:

• MS-DRG 291- Heart Failure and Shock with MCC
• MS-DRG 641- Nutritional & Miscellaneous Metabolic Disorders w/o MCC
• MS-DRG 193- Simple Pneumonia and Pleurisy with MCC
• MS-DRG 287- Circulatory Disorders except AMI, with cardiac cath w/o MCC
• MS-DRG 871- Septicemia or Severe Sepsis w/o MV 96+ hours with MCC
• MS-DRG 312- Syncope and Collapse
• MS-DRG 690- Kidney and Urinary Tract Infections w/o MCC
• MS-DRG 313- Chest Pain
• MS-DRG 603- Cellulitis w/o MCC
• MS-DRG 470- Major Joint Replacement or Reattachment of Lower Extremity w/o MCC

Making sense of all of this

Case management does not necessarily include being an expert in MS-DRGs. Just the same, we should be knowledgeable of our facility’s top 25 Medicare MS-DRG discharges, including clinical entities associated with each of these MS-DRGs. With this knowledge, the case manager’s precious time and effort can be invested in insuring timely discharge planning and appropriate use of hospital resources—a precious commodity in today’s current healthcare business economic climate.

Now would be an ideal time to request, review and analyze discharge patterns and length of stay for each of the above listed MS-DRGs. Focus on identifying potential extended length of stay issues, initiating plans of action to tighten up long lengths of stay when care drive and clinically appropriate. Let the efforts begin.