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Proposed Rule

Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the Long-Term Care Hospital Prospective Payment System and Proposed Policy Changes and Fiscal Year 2020 Rates; Proposed Quality Reporting Requirements for Specific Providers; Medicare and Medicaid Promoting Interoperability Programs Proposed Requirements for Eligible Hospitals and Critical Access Hospitals

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Start Preamble Start Printed Page 19158

AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION:

Proposed rule.

SUMMARY:

We are proposing to revise the Medicare hospital inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals to implement changes arising from our continuing experience with these systems for FY 2020 and to implement certain recent legislation. We also are proposing to make changes relating to Medicare graduate medical education (GME) for teaching hospitals and payments to critical access hospital (CAHs). In addition, we are proposing to provide the market basket update that would apply to the rate-of-increase limits for certain hospitals excluded from the IPPS that are paid on a reasonable cost basis, subject to these limits for FY 2020. We are proposing to update the payment policies and the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs) for FY 2020. In this proposed rule, we are including proposals to address wage index disparities between high and low wage index hospitals; to provide for an alternative IPPS new technology add-on payment pathway for certain transformative new devices; and to revise the calculation of the IPPS new technology add-on payment. In addition, we are requesting public comments on the substantial clinical improvement criterion used for evaluating applications for both the IPPS new technology add-on payment and the OPPS transitional pass-through payment for devices, and we discuss potential revisions that we are considering adopting as final policies related to the substantial clinical improvement criterion for applications received beginning in FY 2020 for IPPS (that is, for FY 2021 and later new technology add-on payments) and beginning in CY 2020 for the OPPS.

We are proposing to establish new requirements or revise existing requirements for quality reporting by specific Medicare providers (acute care hospitals, PPS-exempt cancer hospitals, and LTCHs). We also are proposing to establish new requirements and revise existing requirements for eligible hospitals and critical access hospitals (CAHs) participating in the Medicare and Medicaid Promoting Interoperability Programs. We are proposing to update policies for the Hospital Value-Based Purchasing (VBP) Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition (HAC) Reduction Program.

DATES:

To be assured consideration, comments must be received at one of the addresses provided in the ADDRESSES section, no later than 5 p.m. EDT on June 24, 2019.

ADDRESSES:

In commenting, please refer to file code CMS-1716-P. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.

Comments, including mass comment submissions, must be submitted in one of the following three ways (please choose only one of the ways listed):

1. Electronically. You may (and we encourage you to) submit electronic comments on this regulation to http://www.regulations.gov. Follow the instructions under the “submit a comment” tab.

2. By regular mail. You may mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1716-P, P.O. Box 8013, Baltimore, MD 21244-1850.

Please allow sufficient time for mailed comments to be received before the close of the comment period.

3. By express or overnight mail. You may send written comments via express or overnight mail to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1716-P, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

For information on viewing public comments, we refer readers to the beginning of the SUPPLEMENTARY INFORMATION section.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Donald Thompson, (410) 786-4487, and Michele Hudson, (410) 786-4487, Operating Prospective Payment, MS-DRGs, Wage Index, New Medical Service and Technology Add-On Payments, Hospital Geographic Reclassifications, Graduate Medical Education, Capital Prospective Payment, Excluded Hospitals, Medicare Disproportionate Share Hospital (DSH) Payment Adjustment, Medicare-Dependent Small Rural Hospital (MDH) Program, Low-Volume Hospital Payment Adjustment, and Critical Access Hospital (CAH) Issues.

Michele Hudson, (410) 786-4487, Mark Luxton, (410) 786-4530, and Emily Lipkin, (410) 786-3633, Long-Term Care Hospital Prospective Payment System and MS-LTC-DRG Relative Weights Issues.

Siddhartha Mazumdar, (410) 786-6673, Rural Community Hospital Demonstration Program Issues.

Jeris Smith, (410) 786-0110, Frontier Community Health Integration Project Demonstration Issues.

Erin Patton, (410) 786-2437, Hospital Readmissions Reduction Program Administration Issues.

Lein Han, 410-786-0205, Hospital Readmissions Reduction Program—Readmissions—Measures Issues.

Michael Brea, (410) 786-4961, Hospital-Acquired Condition Reduction Program Issues.

Annese Abdullah-Mclaughlin, (410) 786-2995, Hospital-Acquired Condition Reduction Program—Measures Issues.

Grace Snyder, (410) 786-0700 and James Poyer, (410) 786-2261, Hospital Inpatient Quality Reporting and Hospital Value-Based Purchasing—Program Administration, Validation, and Reconsideration Issues.

Cindy Tourison, (410) 786-1093, Hospital Inpatient Quality Reporting and Hospital Value-Based Purchasing—Measures Issues Except Hospital Consumer Assessment of Healthcare Providers and Systems Issues.

Elizabeth Goldstein, (410) 786-6665, Hospital Inpatient Quality Reporting and Hospital Value-Based Purchasing—Hospital Consumer Assessment of Healthcare Providers and Systems Measures Issues.

Nekeshia McInnis, (410) 786-4486 and Ronique Evans, (410) 786-1000, PPS-Exempt Cancer Hospital Quality Reporting Issues.

Mary Pratt, (410) 786-6867, Long-Term Care Hospital Quality Data Reporting Issues.

Elizabeth Holland, (410) 786-1309, Dylan Podson (410) 786-5031, and Bryan Rossi (410) 786-065l, Promoting Interoperability Programs.Start Printed Page 19159

Benjamin Moll, (410) 786-4390, Provider Reimbursement Review Board Appeals Issues.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following website as soon as possible after they have been received: http://www.regulations.gov/​. Follow the search instructions on that website to view public comments.

Electronic Access

This Federal Register document is available from the Federal Register online database through Federal Digital System (FDsys), a service of the U.S. Government Printing Office. This database can be accessed via the internet at: http://www.gpo.gov/​fdsys.

Tables Available Through the Internet on the CMS Website

In the past, a majority of the tables referred to throughout this preamble and in the Addendum to the proposed rule and the final rule were published in the Federal Register as part of the annual proposed and final rules. However, beginning in FY 2012, the majority of the IPPS tables and LTCH PPS tables are no longer published in the Federal Register. Instead, these tables, generally, will be available only through the internet. The IPPS tables for this FY 2020 proposed rule are available through the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html. Click on the link on the left side of the screen titled, “FY 2020 IPPS Proposed Rule Home Page” or “Acute Inpatient—Files for Download.” The LTCH PPS tables for this FY 2020 proposed rule are available through the internet on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​LongTermCareHospitalPPS/​index.html under the list item for Regulation Number CMS-1716-P. For further details on the contents of the tables referenced in this proposed rule, we refer readers to section VI. of the Addendum to this proposed rule.

Readers who experience any problems accessing any of the tables that are posted on the CMS websites identified above should contact Michael Treitel at (410) 786-4552.

Table of Contents

I. Executive Summary and Background

A. Executive Summary

B. Background Summary

C. Summary of Provisions of Recent Legislation Implemented in This Proposed Rule

D. Summary of the Provisions of This Proposed Rule

E. Advancing Health Information Exchange

II. Proposed Changes to Medicare Severity Diagnosis-Related Group (MS-DRG) Classifications and Relative Weights

A. Background

B. MS-DRG Reclassifications

C. Adoption of the MS-DRGs in FY 2008

D. Proposed FY 2020 MS-DRG Documentation and Coding Adjustment

E. Refinement of the MS-DRG Relative Weight Calculation

F. Proposed Changes to Specific MS-DRG Classifications

G. Recalibration of the Proposed FY 2020 MS-DRG Relative Weights

H. Proposed Add-On Payments for New Services and Technologies for FY 2020

III. Proposed Changes to the Hospital Wage Index for Acute Care Hospitals

A. Background

B. Worksheet S-3 Wage Data for the Proposed FY 2020 Wage Index

C. Verification of Worksheet S-3 Wage Data

D. Method for Computing the Proposed FY 2020 Unadjusted Wage Index

E. Proposed Occupational Mix Adjustment to the Proposed FY 2020 Wage Index

F. Analysis and Implementation of the Proposed Occupational Mix Adjustment and the Proposed FY 2020 Occupational Mix Adjusted Wage Index

G. Proposed Application of the Rural Floor, Expired Imputed Floor Policy, and Proposed Application of the State Frontier Floor

H. Proposed FY 2020 Wage Index Tables

I. Proposed Revisions to the Wage Index Based on Hospital Redesignations and Reclassifications

J. Proposed Out-Migration Adjustment Based on Commuting Patterns of Hospital Employees

K. Reclassification from Urban to Rural Under Section 1886(d)(8)(E) of the Act Implemented at 42 CFR 412.103

L. Process for Requests for Wage Index Data Corrections

M. Proposed Labor-Related Share for the FY 2020 Wage Index

N. Proposals to Address Wage Index Disparities Between High and Low Wage Index Hospitals

IV. Other Decisions and Proposed Changes to the IPPS for Operating Costs

A. Proposed Changes to MS-DRGs Subject to Postacute Care Transfer and MS-DRG Special Payment Policies

B. Proposed Changes in the Inpatient Hospital Updates for FY 2020 (§ 412.64(d))

C. Proposed Rural Referral Centers (RRCs) Annual Updates to Case-Mix Index and Discharge Criteria (§ 412.96)

D. Proposed Payment Adjustment for Low-Volume Hospitals (§ 412.101)

E. Proposed Indirect Medical Education (IME) Payment Adjustment (§ 412.105)

F. Proposed Payment Adjustment for Medicare Disproportionate Share Hospitals (DSHs) for FY 2020 (§ 412.106)

G. Hospital Readmissions Reduction Program: Proposed Updates and Changes (§§ 412.150 through 412.154)

H. Hospital Value-Based Purchasing (VBP) Program: Proposed Policy Changes

I. Hospital-Acquired Condition (HAC) Reduction Program

J. Payments for Indirect and Direct Graduate Medical Education Costs (§§ 412.105 and 413.75 through 413.83)

K. Rural Community Hospital Demonstration Program

V. Proposed Changes to the IPPS for Capital-Related Costs

A. Overview

B. Additional Provisions

C. Proposed Annual Update for FY 2020

VI. Proposed Changes for Hospitals Excluded From the IPPS

A. Proposed Rate-of-Increase in Payments to Excluded Hospitals for FY 2020

B. Request for Public Comments on Methodologies and Requirements for Adjustments to Rate-of-Increase Ceiling

C. Critical Access Hospitals (CAHs)

VII. Proposed Changes to the Long-Term Care Hospital Prospective Payment System (LTCH PPS) for FY 2019

A. Background of the LTCH PPS

B. Proposed Medicare Severity Long-Term Care Diagnosis-Related Group (MS-LTC-DRG) Classifications and Relative Weights for FY 2020

C. Proposed Payment Adjustment for LTCH Discharges That Do Not Meet the Applicable Discharge Payment Percentage

D. Proposed Changes to the LTCH PPS Payment Rates and Other Proposed Changes to the LTCH PPS for FY 2020

VIII. Proposed Quality Data Reporting Requirements for Specific Providers and Suppliers

A. Hospital Inpatient Quality Reporting (IQR) Program

B. PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program

C. Long-Term Care Hospital Quality Reporting Program (LTCH QRP)

D. Proposed Changes to the Medicare and Medicaid Promoting Interoperability Programs

IX. MedPAC Recommendations

X. Other Required Information

A. Publicly Available Data

B. Collection of Information Requirements

C. Response to Public Comments

XI. Provider Reimbursement Review Board (PRRB) Appeals

Regulation Text

Addendum—Proposed Schedule of Standardized Amounts, Update Factors, and Rate-of-Increase Percentages Effective With Cost Reporting Periods Beginning on or After October 1, 2019 and Proposed Payment Rates for LTCHs Effective With Discharges Occurring on or After October 1, 2019

I. Summary and Background

II. Proposed Changes to the Prospective Payment Rates for Hospital Inpatient Start Printed Page 19160Operating Costs for Acute Care Hospitals for FY 2020

A. Calculation of the Proposed Adjusted Standardized Amount

B. Proposed Adjustments for Area Wage Levels and Cost-of-Living

C. Calculation of the Proposed Prospective Payment Rates

III. Proposed Changes to Payment Rates for Acute Care Hospital Inpatient Capital-Related Costs for FY 2020

A. Determination of Proposed Federal Hospital Inpatient Capital-Related Prospective Payment Rate Update

B. Calculation of the Proposed Inpatient Capital-Related Prospective Payments for FY 2020

C. Capital Input Price Index

IV. Proposed Changes to Payment Rates for Excluded Hospitals: Rate-of-Increase Percentages for FY 2020

V. Proposed Updates to the Payment Rates for the LTCH PPS for FY 2020

A. Proposed LTCH PPS Standard Federal Payment Rate for FY 2020

B. Proposed Adjustment for Area Wage Levels Under the LTCH PPS for FY 2020

C. Proposed LTCH PPS Cost-of-Living Adjustment (COLA) for LTCHs Located in Alaska and Hawaii

D. Proposed Adjustment for LTCH PPS High-Cost Outlier (HCO) Cases

E. Proposed Update to the IPPS Comparable/Equivalent Amounts to Reflect the Statutory Changes to the IPPS DSH Payment Adjustment Methodology

F. Computing the Proposed Adjusted LTCH PPS Federal Prospective Payments for FY 2020

VI. Tables Referenced in This Proposed Rule and Available Through the Internet on the CMS Website

Appendix A—Economic Analyses

I. Regulatory Impact Analysis

A. Statement of Need

B. Overall Impact

C. Objectives of the IPPS and the LTCH PPS

D. Limitations of Our Analysis

E. Hospitals Included in and Excluded From the IPPS

F. Effects on Hospitals and Hospital Units Excluded From the IPPS

G. Quantitative Effects of the Proposed Policy Changes Under the IPPS for Operating Costs

H. Effects of Other Proposed Policy Changes

I. Effects of Proposed Changes in the Capital IPPS

J. Effects of Proposed Payment Rate Changes and Policy Changes Under the LTCH PPS

K. Effects of Proposed Requirements for Hospital Inpatient Quality Reporting (IQR) Program

L. Effects of Proposed Requirements for the PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program

M. Effects of Proposed Requirements for the Long-Term Care Hospital Quality Reporting Program (LTCH QRP)

N. Effects of Proposed Requirements Regarding the Medicare Promoting Interoperability Program

O. Alternatives Considered

P. Reducing Regulation and Controlling Regulatory Costs

Q. Overall Conclusion

R. Regulatory Review Costs

II. Accounting Statements and Tables

A. Acute Care Hospitals

B. LTCHs

III. Regulatory Flexibility Act (RFA) Analysis

IV. Impact on Small Rural Hospitals

V. Unfunded Mandate Reform Act (UMRA) Analysis

VI. Executive Order 13175

VII. Executive Order 12866

Appendix B: Recommendation of Update Factors for Operating Cost Rates of Payment for Inpatient Hospital Services

I. Background

II. Proposed Inpatient Hospital Update for FY 2020

A. Proposed FY 2020 Inpatient Hospital Update

B. Proposed Update for SCHs and MDHs for FY 2020

C. Proposed FY 2020 Puerto Rico Hospital Update

D. Proposed Update for Hospitals Excluded From the IPPS

E. Proposed Update for LTCHs for FY 2020

III. Secretary's Recommendation

IV. MedPAC Recommendation for Assessing Payment Adequacy and Updating Payments in Traditional Medicare

I. Executive Summary and Background

A. Executive Summary

1. Purpose and Legal Authority

This proposed rule would make payment and policy changes under the Medicare inpatient prospective payment systems (IPPS) for operating and capital-related costs of acute care hospitals as well as for certain hospitals and hospital units excluded from the IPPS. In addition, it would make payment and policy changes for inpatient hospital services provided by long-term care hospitals (LTCHs) under the long-term care hospital prospective payment system (LTCH PPS). This proposed rule also would make policy changes to programs associated with Medicare IPPS hospitals, IPPS-excluded hospitals, and LTCHs. In this proposed rule, we are including proposals to address wage index disparities between high and low wage index hospitals; to provide for an alternative IPPS new technology add-on payment pathway for certain transformative new devices; and to revise the calculation of the IPPS new technology add-on payment. In addition, we are requesting public comments on the substantial clinical improvement criterion for evaluating applications for both the IPPS new technology add-on payment and the OPPS transitional pass-through payment for devices, and we discuss potential revisions that we are considering adopting as final policies related to the substantial clinical improvement criterion for FY 2020 for IPPS and CY 2020 for the OPPS.

We are proposing to establish new requirements and revise existing requirements for quality reporting by specific providers (acute care hospitals, PPS-exempt cancer hospitals, and LTCHs) that are participating in Medicare. We also are proposing to establish new requirements and revise existing requirements for eligible hospitals and CAHs participating in the Medicare and Medicaid Promoting Interoperability Programs. We are proposing to update policies for the Hospital Value-Based Purchasing (VBP) Program, the Hospital Readmissions Reduction Program, and the Hospital-Acquired Condition (HAC) Reduction Program.

Under various statutory authorities, we are proposing to make changes to the Medicare IPPS, to the LTCH PPS, and to other related payment methodologies and programs for FY 2020 and subsequent fiscal years. These statutory authorities include, but are not limited to, the following:

  • Section 1886(d) of the Social Security Act (the Act), which sets forth a system of payment for the operating costs of acute care hospital inpatient stays under Medicare Part A (Hospital Insurance) based on prospectively set rates. Section 1886(g) of the Act requires that, instead of paying for capital-related costs of inpatient hospital services on a reasonable cost basis, the Secretary use a prospective payment system (PPS).
  • Section 1886(d)(1)(B) of the Act, which specifies that certain hospitals and hospital units are excluded from the IPPS. These hospitals and units are: Rehabilitation hospitals and units; LTCHs; psychiatric hospitals and units; children's hospitals; cancer hospitals; extended neoplastic disease care hospitals, and hospitals located outside the 50 States, the District of Columbia, and Puerto Rico (that is, hospitals located in the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa). Religious nonmedical health care institutions (RNHCIs) are also excluded from the IPPS.
  • Sections 123(a) and (c) of the BBRA (Pub. L. 106-113) and section 307(b)(1) of the BIPA (Pub. L. 106-554) (as codified under section 1886(m)(1) of the Act), which provide for the development and implementation of a prospective payment system for payment for inpatient hospital services of LTCHs described in section 1886(d)(1)(B)(iv) of the Act.Start Printed Page 19161
  • Sections 1814(l), 1820, and 1834(g) of the Act, which specify that payments are made to critical access hospitals (CAHs) (that is, rural hospitals or facilities that meet certain statutory requirements) for inpatient and outpatient services and that these payments are generally based on 101 percent of reasonable cost.
  • Section 1866(k) of the Act, which establishes a quality reporting program for hospitals described in section 1886(d)(1)(B)(v) of the Act, referred to as “PPS-exempt cancer hospitals.”
  • Section 1886(a)(4) of the Act, which specifies that costs of approved educational activities are excluded from the operating costs of inpatient hospital services. Hospitals with approved graduate medical education (GME) programs are paid for the direct costs of GME in accordance with section 1886(h) of the Act.
  • Section 1886(b)(3)(B)(viii) of the Act, which requires the Secretary to reduce the applicable percentage increase that would otherwise apply to the standardized amount applicable to a subsection (d) hospital for discharges occurring in a fiscal year if the hospital does not submit data on measures in a form and manner, and at a time, specified by the Secretary.
  • Section 1886(o) of the Act, which requires the Secretary to establish a Hospital Value-Based Purchasing (VBP) Program, under which value-based incentive payments are made in a fiscal year to hospitals meeting performance standards established for a performance period for such fiscal year.
  • Section 1886(p) of the Act, which establishes a Hospital-Acquired Condition (HAC) Reduction Program, under which payments to applicable hospitals are adjusted to provide an incentive to reduce hospital-acquired conditions.
  • Section 1886(q) of the Act, as amended by section 15002 of the 21st Century Cures Act, which establishes the Hospital Readmissions Reduction Program. Under the program, payments for discharges from an applicable hospital as defined under section 1886(d) of the Act will be reduced to account for certain excess readmissions. Section 15002 of the 21st Century Cures Act requires the Secretary to compare hospitals with respect to the number of their Medicare-Medicaid dual-eligible beneficiaries (dual-eligibles) in determining the extent of excess readmissions.
  • Section 1886(r) of the Act, as added by section 3133 of the Affordable Care Act, which provides for a reduction to disproportionate share hospital (DSH) payments under section 1886(d)(5)(F) of the Act and for a new uncompensated care payment to eligible hospitals. Specifically, section 1886(r) of the Act requires that, for fiscal year 2014 and each subsequent fiscal year, subsection (d) hospitals that would otherwise receive a DSH payment made under section 1886(d)(5)(F) of the Act will receive two separate payments: (1) 25 percent of the amount they previously would have received under section 1886(d)(5)(F) of the Act for DSH (“the empirically justified amount”), and (2) an additional payment for the DSH hospital's proportion of uncompensated care, determined as the product of three factors. These three factors are: (1) 75 percent of the payments that would otherwise be made under section 1886(d)(5)(F) of the Act; (2) 1 minus the percent change in the percent of individuals who are uninsured; and (3) a hospital's uncompensated care amount relative to the uncompensated care amount of all DSH hospitals expressed as a percentage.
  • Section 1886(m)(6) of the Act, as added by section 1206(a)(1) of the Pathway for Sustainable Growth Rate (SGR) Reform Act of 2013 (Pub. L. 113-67) and amended by section 51005(a) of the Bipartisan Budget Act of 2018 (Pub. L. 115-123), which provided for the establishment of site neutral payment rate criteria under the LTCH PPS, with implementation beginning in FY 2016, and provides for a 4-year transitional blended payment rate for discharges occurring in LTCH cost reporting periods beginning in FYs 2016 through 2019. Section 51005(b) of the Bipartisan Budget Act of 2018 amended section 1886(m)(6)(B) by adding new clause (iv), which specifies that the IPPS comparable amount defined in clause (ii)(I) shall be reduced by 4.6 percent for FYs 2018 through 2026.
  • Section 1886(m)(5)(D)(iv) of the Act, as added by section 1206(c) of the Pathway for Sustainable Growth Rate (SGR) Reform Act of 2013 (Pub. L. 113-67), which provides for the establishment of a functional status quality measure in the LTCH QRP for change in mobility among inpatients requiring ventilator support.
  • Section 1899B of the Act, as added by section 2(a) of the Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act) (Pub. L. 113-185), which provides for the establishment of standardized data reporting for certain post-acute care providers, including LTCHs.

2. Summary of the Major Provisions

Below we provide a summary of the major provisions in this proposed rule. In general, these major provisions are being proposed as part of the annual update to the payment policies and payment rates, consistent with the applicable statutory provisions. A general summary of the proposed changes in this proposed rule is presented in section I.D. of the preamble of this proposed rule.

a. Proposed MS-DRG Documentation and Coding Adjustment

Section 631 of the American Taxpayer Relief Act of 2012 (ATRA, Pub. L. 112-240) amended section 7(b)(1)(B) of Public Law 110-90 to require the Secretary to make a recoupment adjustment to the standardized amount of Medicare payments to acute care hospitals to account for changes in MS-DRG documentation and coding that do not reflect real changes in case-mix, totaling $11 billion over a 4-year period of FYs 2014, 2015, 2016, and 2017. The FY 2014 through FY 2017 adjustments represented the amount of the increase in aggregate payments as a result of not completing the prospective adjustment authorized under section 7(b)(1)(A) of Public Law 110-90 until FY 2013. Prior to the ATRA, this amount could not have been recovered under Public Law 110 90. Section 414 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10) replaced the single positive adjustment we intended to make in FY 2018 with a 0.5 percent positive adjustment to the standardized amount of Medicare payments to acute care hospitals for FYs 2018 through 2023. (The FY 2018 adjustment was subsequently adjusted to 0.4588 percent by section 15005 of the 21st Century Cures Act.) Therefore, for FY 2020, we are proposing to make an adjustment of + 0.5 percent to the standardized amount.

b. Request for Information on the New Technology Add-On Payment and Transitional Device Pass-Through Payment Substantial Clinical Improvement Criterion and Discussion of Potential Revisions to the New Technology Add-On Payment and Transitional Device Pass-Through Payment Substantial Clinical Improvement Criterion

The substantial clinical improvement criterion that is used to evaluate a technology that is the subject of an application for the new technology add-on payment under the IPPS or an application for the transitional pass-through payment for additional costs of innovative devices under the OPPS is the subject of the request for information and the discussion of potential revisions included in this proposed rule.Start Printed Page 19162

We understand that greater clarity regarding what would substantiate the requirements of this criterion would help the public, including innovators, better understand how CMS evaluates new technology applications for add-on payments and provide greater predictability about which applications will meet the criterion for substantial clinical improvement. We are considering potential revisions to the substantial clinical improvement criterion under the IPPS new technology add-on payment policy and the OPPS transitional pass-through payment policy for devices policy, and are seeking public comments on the type of additional detail and guidance that the public and applicants for new technology add-on payments would find useful. The comments we receive in response to those general questions will inform future rulemaking after the FY 2020 IPPS/LTCH PPS final rule. This request for public comments is intended to be broad in scope and provide a foundation for potential rulemaking in future years.

In addition to this broad request for public comments for potential rulemaking in future years, in order to respond to stakeholder feedback requesting greater understanding of CMS' approach to evaluating substantial clinical improvement, we are soliciting public comments on specific changes or clarifications to the IPPS and OPPS substantial clinical improvement criterion that CMS might consider making in the FY 2020 IPPS/LTCH PPS final rule for applications received beginning in FY 2020 for the IPPS and CY 2020 for the OPPS to provide greater clarity and predictability.

c. Proposed Alternative Inpatient New Technology Add-On Payment Pathway for Transformative New Devices

After consideration of the issues discussed in section III.H.8. of the preamble of this proposed rule relating to the Food and Drug Administration's (FDA's) expedited programs, and consistent with the Administration's commitment to addressing barriers to health care innovation and ensuring that Medicare beneficiaries have access to critical and life-saving new cures and technologies that improve beneficiary health outcomes, we concluded that it would be appropriate to develop an alternative pathway for the inpatient new technology add-on payment for transformative medical devices. In situations where a new medical device is part of the FDA's Breakthrough Devices Program and has received FDA marketing authorization (that is, the device has received pre-market approval (PMA); 510(k) clearance; or the granting of a De Novo classification request), we are proposing an alternative inpatient new technology add-on payment pathway to facilitate access to this technology for Medicare beneficiaries.

Specifically, we are proposing that, for applications received for IPPS new technology add-on payments for FY 2021 and subsequent fiscal years, if a medical device is part of the FDA's Breakthrough Devices Program and received FDA marketing authorization, such a device would be considered new and not substantially similar to an existing technology for purposes of new technology add-on payment under the IPPS. In light of the criteria applied under the FDA's Breakthrough Devices Program, and because the technology may not have a sufficient evidence base to demonstrate substantial clinical improvement at the time of FDA marketing authorization, we also are proposing that the medical device would not need to meet the requirement under 42 CFR 412.87(b)(1) that it represent an advance that substantially improves, relative to technologies previously available, the diagnosis or treatment of Medicare beneficiaries.

d. Proposed Revision of the Calculation of the Inpatient Hospital New Technology Add-On Payment

The current calculation of the new technology add-on payment is based on the cost to hospitals for the new medical service or technology. Under § 412.88, if the costs of the discharge (determined by applying cost-to-charge ratios (CCRs) as described in § 412.84(h)) exceed the full DRG payment (including payments for IME and DSH, but excluding outlier payments), Medicare will make an add-on payment equal to the lesser of: (1) 50 percent of the costs of the new medical service or technology; or (2) 50 percent of the amount by which the costs of the case exceed the standard DRG payment. Unless the discharge qualifies for an outlier payment, the additional Medicare payment is limited to the full MS-DRG payment plus 50 percent of the estimated costs of the new technology or medical service.

After consideration of the concerns raised by commenters and other stakeholders, we agree that there may be merit to the recommendations to increase the maximum add-on amount, and that capping the add-on payment amount at 50 percent could, in some cases, no longer provide a sufficient incentive for the use of new technology. To address this issue, we believe it would be appropriate to modify the current payment mechanism to increase the amount of the maximum add-on payment amount to 65 percent. Therefore, we are proposing that, beginning with discharges occurring on or after October 1, 2019, if the costs of a discharge involving a new medical service or technology exceed the full DRG payment (including payments for IME and DSH, but excluding outlier payments), Medicare would make an add-on payment equal to the lesser of: (1) 65 percent of the costs of the new medical service or technology; or (2) 65 percent of the amount by which the costs of the case exceed the standard DRG payment.

e. Proposals To Address Wage Index Disparities Between High and Low Wage Index Hospitals

In the FY 2019 IPPS/LTCH PPS proposed rule (83 FR 20372), we invited the public to submit further comments, suggestions, and recommendations for regulatory and policy changes to the Medicare wage index. Many of the responses received from this request for information (RFI) reflect a common concern that the current wage index system perpetuates and exacerbates the disparities between high and low wage index hospitals. Many respondents also expressed concern that the calculation of the rural floor has allowed a limited number of States to manipulate the wage index system to achieve higher wages for many urban hospitals in those States at the expense of hospitals in other States, which also contributes to wage index disparities.

To help mitigate these wage index disparities, including those resulting from the inclusion of hospitals with rural reclassifications under 42 CFR 412.103 in the rural floor, we are proposing to reduce the disparity between high and low wage index hospitals by increasing the wage index values for certain hospitals with low wage index values and decreasing the wage index values for certain hospitals with high wage index values for budget neutrality purposes, as well as changing the calculation of the rural floor. We also are proposing a transition for hospitals experiencing significant decreases in their wage index values as a result of these proposed changes. We are proposing to make these changes in a budget neutral manner.

In this proposed rule, we are proposing to increase the wage index for hospitals with a wage index value below the 25th percentile wage index value for a fiscal year by half the difference between the otherwise applicable final wage index value for a year for that hospital and the 25th percentile wage index value for that year across all hospitals. Furthermore, we are Start Printed Page 19163proposing that this policy would be effective for at least 4 years, beginning in FY 2020, in order to allow employee compensation increases implemented by these hospitals sufficient time to be reflected in the wage index calculation. Under our proposal, in order to offset the estimated increase in IPPS payments to hospitals with wage index values below the 25th percentile wage index value, we are proposing to decrease the wage index values for certain hospitals with high wage index values (that is, hospitals with wage index values above the 75th percentile wage index value), but preserve the rank order among those values.

In addition, we are proposing to remove urban to rural reclassifications from the calculation of the rural floor, such that, beginning in FY 2020, the rural floor would be calculated without including the wage data of hospitals that have reclassified as rural under section 1886(d)(8)(E) of the Act (as implemented in the regulations at § 412.103). Also, for the purposes of applying the provisions of section 1886(d)(8)(C)(iii) of the Act, we are proposing to remove urban to rural reclassifications from the calculation of “the wage index for rural areas in the State in which the county is located” as referred to in the statute.

Lastly, for FY 2020, we are proposing to place a 5-percent cap on any decrease in a hospital's wage index from the hospital's final wage index in FY 2019. We are proposing to apply a budget neutrality adjustment to the standardized amount so that our proposed transition for hospitals that could be negatively impacted is implemented in a budget neutral manner.

f. Proposed DSH Payment Adjustment and Additional Payment for Uncompensated Care

Section 3133 of the Affordable Care Act modified the Medicare disproportionate share hospital (DSH) payment methodology beginning in FY 2014. Under section 1886(r) of the Act, which was added by section 3133 of the Affordable Care Act, starting in FY 2014, DSHs receive 25 percent of the amount they previously would have received under the statutory formula for Medicare DSH payments in section 1886(d)(5)(F) of the Act. The remaining amount, equal to 75 percent of the amount that otherwise would have been paid as Medicare DSH payments, is paid as additional payments after the amount is reduced for changes in the percentage of individuals that are uninsured. Each Medicare DSH will receive an additional payment based on its share of the total amount of uncompensated care for all Medicare DSHs for a given time period.

In this FY 2020 IPPS/LTCH PPS proposed rule, we are proposing to update our estimates of the three factors used to determine uncompensated care payments for FY 2020. We are proposing to continue to use uninsured estimates produced by CMS' Office of the Actuary (OACT) as part of the development of the National Health Expenditure Accounts (NHEA) in the calculation of Factor 2. We also are proposing to use a single year of data on uncompensated care costs from Worksheet S-10 for FY 2015 to determine Factor 3 for FY 2020. We also are seeking public comments on whether we should, due to changes in the reporting instructions that became effective for FY 2017, alternatively use a single year of Worksheet S-10 data from the FY 2017 cost reports, instead of the FY 2015 Worksheet S-10 data, to calculate Factor 3 for FY 2020. In addition, we are proposing to continue to use only data regarding low-income insured days for FY 2013 to determine the amount of uncompensated care payments for Puerto Rico hospitals, and Indian Health Service and Tribal hospitals. We are not proposing specific Factor 3 polices for all-inclusive rate providers for FY 2020. In this proposed rule, we also are proposing to continue to use the following established policies: (1) For providers with multiple cost reports, beginning in the same fiscal year, to use the longest cost report and annualize Medicaid data and uncompensated care data if a hospital's cost report does not equal 12 months of data; (2) in the rare case where a provider has multiple cost reports beginning in the same fiscal year, but one report also spans the entirety of the following fiscal year, such that the hospital has no cost report for that fiscal year, to use the cost report that spans both fiscal years for the latter fiscal year; and (3) to apply statistical trim methodologies to potentially aberrant cost-to-charge ratios (CCRs) and potentially aberrant uncompensated care costs reported on the Worksheet S-10.

g. Proposed Changes to the LTCH PPS

In this proposed rule, we set forth proposed changes to the LTCH PPS Federal payment rates, factors, and other payment rate policies under the LTCH PPS for FY 2020. We also are proposing the payment adjustment for LTCH discharges when the LTCH does not meet the applicable discharge payment percentage and a proposed reinstatement process, as required by section 1886(m)(6)(C) of the Act. An LTCH would be subject to this payment adjustment if, for cost reporting periods beginning in FY 2020 and subsequent fiscal years, the LTCH's percentage of Medicare discharges that meet the criteria for exclusion from the site neutral payment rate (that is, discharges paid the LTCH PPS standard Federal payment rate) of its total number of Medicare FFS discharges paid under the LTCH PPS during the cost reporting period is not at least 50 percent.

h. Reduction of Hospital Payments for Excess Readmissions

We are proposing to make changes to policies for the Hospital Readmissions Reduction Program, which was established under section 1886(q) of the Act, as amended by section 15002 of the 21st Century Cures Act. The Hospital Readmissions Reduction Program requires a reduction to a hospital's base operating DRG payment to account for excess readmissions of selected applicable conditions. For FY 2017 and subsequent years, the reduction is based on a hospital's risk-adjusted readmission rate during a 3-year period for acute myocardial infarction (AMI), heart failure (HF), pneumonia, chronic obstructive pulmonary disease (COPD), elective primary total hip arthroplasty/total knee arthroplasty (THA/TKA), and coronary artery bypass graft (CABG) surgery. In this proposed rule, we are proposing the following policies: (1) A measure removal policy that aligns with the removal factor policies previously adopted in other quality reporting and quality payment programs; (2) an update to the Program's definition of “dual-eligible” beginning with the FY 2021 program year to allow for a 1-month lookback period in data sourced from the State Medicare Modernization Act (MMA) files to determine dual-eligible status for beneficiaries who die in the month of discharge; (3) a subregulatory process to address any potential future nonsubstantive changes to the payment adjustment factor components; and (4) an update to the Program's regulations at 42 CFR 412.152 and 412.154 to reflect proposed policies and to codify additional previously finalized policies.

i. Hospital Value-Based Purchasing (VBP) Program

Section 1886(o) of the Act requires the Secretary to establish a Hospital VBP Program under which value-based incentive payments are made in a fiscal year to hospitals based on their performance on measures established for a performance period for such fiscal year. In this proposed rule, we are proposing that the Hospital VBP Start Printed Page 19164Program will use the same data used by the HAC Reduction Program for purposes of calculating the Centers for Disease Control and Prevention (CDC) National Health Safety Network (NHSN) Healthcare-Associated Infection (HAI) measures beginning with CY 2020 data collection, when the Hospital IQR Program will no longer collect data on those measures, and will rely on HAC Reduction Program validation to ensure the accuracy of CDC NHSN HAI measure data used in the Hospital VBP Program. We also are newly establishing certain performance standards.

j. Hospital-Acquired Condition (HAC) Reduction Program

Section 1886(p) of the Act establishes an incentive to hospitals to reduce the incidence of hospital-acquired conditions by requiring the Secretary to make an adjustment to payments to applicable hospitals effective for discharges beginning on October 1, 2014. This 1-percent payment reduction applies to hospitals that rank in the worst-performing quartile (25 percent) of all applicable hospitals, relative to the national average, of conditions acquired during the applicable period and on all of the hospital's discharges for the specified fiscal year. As part of our agency-wide Patients over Paperwork and Meaningful Measures Initiatives, discussed in section I.A.2. of the FY 2019 IPPS/LTCH PPS final rule (83 FR 41147 and 41148), we are proposing to: (1) Adopt a measure removal policy that aligns with the removal factor policies previously adopted in other quality reporting and quality payment programs; (2) clarify administrative policies for validation of the CDC NHSN HAI measures; (3) adopt the data collection periods for the FY 2022 program year; and (4) update 42 CFR 412.172(f) to reflect policies finalized in the FY 2019 IPPS/LTCH PPS final rule.

k. Hospital Inpatient Quality Reporting (IQR) Program

Under section 1886(b)(3)(B)(viii) of the Act, subsection (d) hospitals are required to report data on measures selected by the Secretary for a fiscal year in order to receive the full annual percentage increase that would otherwise apply to the standardized amount applicable to discharges occurring in that fiscal year.

In this proposed rule, we are proposing to make several changes. We are proposing to: (1) Adopt two opioid-related eCQMs (Safe Use of Opioids—Concurrent Prescribing eCQM (NQF #3316e) and Hospital Harm—Opioid-Related Adverse Events eCQM) beginning with the CY 2021 reporting period/FY 2023 payment determination; (2) adopt the Hybrid Hospital-Wide All-Cause Readmission (Hybrid HWR) measure (NQF #2879) in a stepwise fashion, beginning with two voluntary reporting periods which would run from July 1, 2021 through June 30, 2022, and from July 1, 2022 through June 30, 2023, before requiring reporting of the measure for the reporting period that would run from July 1, 2023 through June 30, 2024, impacting the FY 2026 payment determination and for subsequent years; and (3) remove the Claims-Based Hospital-Wide All-Cause Unplanned Readmission Measure (NQF #1789) (HWR claims-only measure) beginning with the FY 2026 payment determination. We also are proposing reporting and submission requirements for eCQMs, including proposals to: (1) Extend current eCQM reporting and submission requirements for both the CY 2020 reporting period/FY 2022 payment determination and CY 2021 reporting period/FY 2023 payment determination; (2) change eCQM reporting and submission requirements for the CY 2022 reporting period/FY 2024 payment determination, such that hospitals would be required to report one, self-selected calendar quarter of data for three self-selected eCQMs and the proposed Safe Use of Opioids—Concurrent Prescribing eCQM (NQF #3316e), for a total of four eCQMs; and (3) continue requiring that EHRs be certified to all available eCQMs used in the Hospital IQR Program for the CY 2020 reporting period/FY 2022 payment determination and subsequent years. These proposals are in alignment with proposals under the Promoting Interoperability Program. We also are proposing reporting and submission requirements for the Hybrid HWR measure. In addition, we are seeking public comments on three measures for potential future inclusion in the Hospital IQR Program.

l. Long-Term Care Hospital Quality Reporting Program (LTCH QRP)

The LTCH QRP is authorized by section 1886(m)(5) of the Act and applies to all hospitals certified by Medicare as long-term care hospitals (LTCHs). Under the LTCH QRP, the Secretary must reduce by 2 percentage points the annual update to the LTCH PPS standard Federal rate for discharges for an LTCH during a fiscal year if the LTCH fails to submit data in accordance with the LTCH QRP requirements specified for that fiscal year. As discussed in section VIII.C. of the preamble of this proposed rule, we are proposing to adopt two measures that meet the requirements of section 1899B(c)(1)(E) of the Act, modify an existing measure, and adopt new standardized patient assessment data elements that satisfy section 1899B(b) of the Act. We also are proposing to move the implementation date of the LTCH Continuity Assessment Record and Evaluation Data Set (LTCH CARE Data Set or LCDS) from April to October to align with other post-acute care programs beginning October 1, 2020. Lastly, we are proposing updates related to the system used for the submission of data and related regulations.

m. Medicare and Medicaid Promoting Interoperability Programs

For purposes of an increased level of stability, reducing the burden on eligible hospitals and CAHs, and clarifying certain existing policies, we are proposing several changes to the Medicare Promoting Interoperability Program. Specifically, we are proposing to: (1) Eliminate requirement that, for the FY 2020 payment adjustment year, for an eligible hospital that has not successfully demonstrated it is a meaningful EHR user in a prior year, the EHR reporting period in CY 2019 must end before and the eligible hospital must successfully register for and attest to meaningful use no later than the October 1, 2019 deadline; (2) establish an EHR reporting period of a minimum of any continuous 90-day period in CY 2021 for new and returning participants (eligible hospitals and CAHs) in the Medicare Promoting Interoperability Program attesting to CMS; (3) require that the Medicare Promoting Interoperability Program measure actions must occur within the EHR reporting period beginning with the EHR reporting period in CY 2020; (4) revise the Query of PDMP measure to make it an optional measure worth 5 bonus points in CY 2020, remove the exclusions associated with this measure in CY 2020, require a yes/no response instead of a numerator and denominator for CY 2019 and CY 2020, and clearly state our intended policy that the measure is worth a full 5 bonus points in CY 2019 and CY 2020; (5) change the maximum points available for the e-Prescribing measure to 10 points beginning in CY 2020, in the event we finalize the proposed changes to the Query of PDMP measure; (6) remove the Verify Opioid Treatment Agreement measure beginning in CY 2020 and clearly state our intended policy that this measure is worth a full 5 bonus points in CY 2019; and (7) revise the Support Electronic Referral Loops by Receiving and Incorporating Health Information measure to more clearly Start Printed Page 19165capture the previously established policy regarding CEHRT use. We are also proposing to amend our regulations to incorporate several of these proposals.

For CQM reporting under the Medicare and Medicaid Promoting Interoperability Programs, we are generally proposing to align our requirements with requirements under the Hospital IQR Program. Specifically, we are proposing to: (1) Adopt two opioid-related eCQMs (Safe Use of Opioids—Concurrent Prescribing eCQM (NQF #3316e) and Hospital Harm—Opioid-Related Adverse Events eCQM) beginning with the reporting period in CY 2021; (2) extend current CQM reporting and submission requirements for the reporting periods in CY 2020 and CY 2021; and (3) establish CQM reporting and submission requirements for the reporting period in CY 2022, which would require all eligible hospitals and CAHs to report on the proposed Safe Use of Opioids—Concurrent Prescribing eCQM (NQF #3316e) beginning with the reporting period in CY 2022.

We are seeking public comments on whether we should consider proposing to adopt in future rulemaking the Hybrid Hospital-Wide All-Cause Readmission (Hybrid HWR) measure beginning with the reporting period in CY 2023, a measure which we are proposing to adopt under the Hospital IQR Program, and we are seeking information on a variety of issues regarding the future direction of the Medicare and Medicaid Promoting Interoperability Programs.

3. Summary of Costs and Benefits

  • Proposed Adjustment for MS-DRG Documentation and Coding Changes. Section 414 of the MACRA replaced the single positive adjustment we intended to make in FY 2018 once the recoupment required by section 631 of the ATRA was complete with a 0.5 percentage point positive adjustment to the standardized amount of Medicare payments to acute care hospitals for FYs 2018 through 2023. (The FY 2018 adjustment was subsequently adjusted to 0.4588 percentage point by section 15005 of the 21st Century Cures Act.) For FY 2020, we are proposing to make an adjustment of +0.5 percentage point to the standardized amount consistent with the MACRA.
  • Proposed Alternative Inpatient New Technology Add-On Payment Pathway for Transformative New Devices: In this proposed rule, we are proposing an alternative inpatient new technology add-on payment pathway for a new medical device that is part of the FDA Breakthrough Devices Program and has received FDA marketing authorization, that is, received PMA approval, 510(k) clearance, or the granting of De Novo classification request.

Given the relatively recent introduction of FDA's Breakthrough Devices Program, there have not been any medical devices that were part of the Breakthrough Devices Program and received FDA marketing authorization and for which the applicant applied for a new technology add-on payment under the IPPS and was not approved. Therefore, it is not possible to quantify the impact of this proposal.

Proposed Changes to the Calculation of the Inpatient Hospital New Technology Add-On Payment: The current calculation of the new technology add-on payment is based on the cost to hospitals for the new medical service or technology. Under existing § 412.88, if the costs of the discharge exceed the full DRG payment (including payments for IME and DSH, but excluding outlier payments), Medicare makes an add-on payment equal to the lesser of: (1) 50 percent of the estimated costs of the new technology or medical service; or (2) 50 percent of the amount by which the costs of the case exceed the standard DRG payment. In this proposed rule, we are proposing to modify the current payment mechanism to increase the amount of the maximum add-on payment amount to 65 percent. Therefore, we are proposing that if the costs of a discharge involving a new technology exceed the full DRG payment (including payments for IME and DSH, but excluding outlier payments), Medicare would make an add-on payment equal to the lesser of: (1) 65 percent of the costs of the new medical service or technology; or (2) 65 percent of the amount by which the costs of the case exceed the standard DRG payment.

We estimate that if we finalize our proposals for the 9 technologies for which we are proposing to continue to make new technology add-on payments in FY 2020 and if we determine that all 17 of the FY 2020 new technology add-on payment applications meet the specified criteria for new technology add-on payments for FY 2020, this proposal, if finalized, would increase IPPS spending by approximately $110 million in FY 2020.

  • Proposed Changes to Address Wage Index Disparities Between High and Low Wage Index Hospitals. As discussed in section III.N. of the preamble of this proposed rule, to help mitigate wage index disparities, including those resulting from the inclusion of hospitals with rural reclassifications under 42 CFR 412.103 in the rural floor, we are proposing to reduce the disparity between high and low wage index hospitals by increasing the wage index values for certain hospitals with low wage index values and decreasing the wage index values of certain hospitals with high wage index values for budget neutrality purposes, as well as changing the calculation of the rural floor. We also are proposing a transition for hospitals experiencing significant decreases in their wage index values as a result of these proposed changes. We are proposing to make these changes in a budget neutral manner.

We are proposing to apply a budget neutrality adjustment to the standardized amount so that our proposed transition for hospitals that could be negatively impacted is implemented in a budget neutral manner.

  • Proposed Medicare DSH Payment Adjustment and Additional Payment for Uncompensated Care. For FY 2020, we are proposing to update our estimates of the three factors used to determine uncompensated care payments. We are proposing to continue to use uninsured estimates produced by OACT as part of the development of the NHEA in the calculation of Factor 2. We also are proposing to use a single year of data on uncompensated care costs from Worksheet S-10 for FY 2015 to determine Factor 3 for FY 2020. In addition, we are seeking public comments on whether we should, due to changes in the reporting instructions that became effective for FY 2017, alternatively use a single year of Worksheet S-10 data from the FY 2017 cost reports, instead of the FY 2015 Worksheet S-10 data, to calculate Factor 3 for FY 2020. To determine the amount of uncompensated care for purposes of calculating Factor 3 for Puerto Rico hospitals and Indian Health Service and Tribal hospitals, we are proposing to continue to use only data regarding low-income insured days for FY 2013.

We project that the amount available to distribute as payments for uncompensated care for FY 2020 would increase by approximately $216 million, as compared to our estimate of the uncompensated care payments that will be distributed in FY 2019. The payments have redistributive effects, based on a hospital's uncompensated care amount relative to the uncompensated care amount for all hospitals that are projected to be eligible to receive Medicare DSH payments, and the calculated payment amount is not directly tied to a hospital's number of discharges.Start Printed Page 19166

Proposed Update to the LTCH PPS Payment Rates and Other Payment Policies. Based on the best available data for the 384 LTCHs in our database, we estimate that the proposed changes to the payment rates and factors that we present in the preamble of and Addendum to this proposed rule, which reflect the end of the transition of the statutory application of the site neutral payment rate and the proposed update to the LTCH PPS standard Federal payment rate for FY 2020, would result in an estimated increase in payments in FY 2020 of approximately $37 million.

  • Proposed Changes to the Hospital Readmissions Reduction Program. For FY 2020 and subsequent years, the reduction is based on a hospital's risk-adjusted readmission rate during a 3-year period for acute myocardial infarction (AMI), heart failure (HF), pneumonia, chronic obstructive pulmonary disease (COPD), elective primary total hip arthroplasty/total knee arthroplasty (THA/TKA), and coronary artery bypass graft (CABG) surgery. Overall, in this proposed rule, we estimate that 2,599 hospitals would have their base operating DRG payments reduced by their determined proxy FY 2020 hospital-specific readmission adjustment. As a result, we estimate that the Hospital Readmissions Reduction Program would save approximately $550 million in FY 2020.
  • Value-Based Incentive Payments Under the Hospital VBP Program. We estimate that there would be no net financial impact to the Hospital VBP Program for the FY 2020 program year in the aggregate because, by law, the amount available for value-based incentive payments under the program in a given year must be equal to the total amount of base operating MS-DRG payment amount reductions for that year, as estimated by the Secretary. The estimated amount of base operating MS-DRG payment amount reductions for the FY 2020 program year and, therefore, the estimated amount available for value-based incentive payments for FY 2020 discharges is approximately $1.9 billion.
  • Proposed Changes to the HAC Reduction Program. A hospital's Total HAC score and its ranking in comparison to other hospitals in any given year depend on several different factors. The FY 2020 program year is the first year in which we will implement our equal measure weights scoring methodology. Any significant impact due to the HAC Reduction Program proposed changes for FY 2020, including which hospitals will receive the adjustment, would depend on the actual experience of hospitals in the Program. We also are proposing to update the hourly wage rate associated with burden for CDC NHSN HAI validation under the HAC Reduction Program.
  • Proposed Changes to the Hospital Inpatient Quality Reporting (IQR) Program. Across 3,300 IPPS hospitals, we estimate that our proposed changes for the Hospital IQR Program in this proposed rule would result in changes to the information collection burden compared to previously adopted requirements. The only proposal that would affect the information collection burden for the Hospital IQR Program is the proposal to adopt the Hybrid Hospital-Wide All-Cause Readmission (Hybrid HWR) measure (NQF #2879) in a stepwise fashion, beginning with two voluntary reporting periods which would run from July 1, 2021 through June 30, 2022, and from July 1, 2022 through June 30, 2023, before requiring reporting of the measure for the reporting period that would run from July 1, 2023 through June 30, 2024, impacting the FY 2026 payment determination and for subsequent years. We estimate that the impact of this proposed change is a total collection of information burden increase of 2,211 hours and a total cost increase of approximately $83,266 for all participating IPPS hospitals annually.
  • Proposed Changes to the Medicare and Medicaid Promoting Interoperability Programs. We believe that, overall, the proposals in this proposed rule would reduce burden, as described in detail in section X.B.9. of the preamble and Appendix A, section I.N. of this proposed rule.

B. Background Summary

1. Acute Care Hospital Inpatient Prospective Payment System (IPPS)

Section 1886(d) of the Social Security Act (the Act) sets forth a system of payment for the operating costs of acute care hospital inpatient stays under Medicare Part A (Hospital Insurance) based on prospectively set rates. Section 1886(g) of the Act requires the Secretary to use a prospective payment system (PPS) to pay for the capital-related costs of inpatient hospital services for these “subsection (d) hospitals.” Under these PPSs, Medicare payment for hospital inpatient operating and capital-related costs is made at predetermined, specific rates for each hospital discharge. Discharges are classified according to a list of diagnosis-related groups (DRGs).

The base payment rate is comprised of a standardized amount that is divided into a labor-related share and a nonlabor-related share. The labor-related share is adjusted by the wage index applicable to the area where the hospital is located. If the hospital is located in Alaska or Hawaii, the nonlabor-related share is adjusted by a cost-of-living adjustment factor. This base payment rate is multiplied by the DRG relative weight.

If the hospital treats a high percentage of certain low-income patients, it receives a percentage add-on payment applied to the DRG-adjusted base payment rate. This add-on payment, known as the disproportionate share hospital (DSH) adjustment, provides for a percentage increase in Medicare payments to hospitals that qualify under either of two statutory formulas designed to identify hospitals that serve a disproportionate share of low-income patients. For qualifying hospitals, the amount of this adjustment varies based on the outcome of the statutory calculations. The Affordable Care Act revised the Medicare DSH payment methodology and provides for a new additional Medicare payment beginning on October 1, 2013, that considers the amount of uncompensated care furnished by the hospital relative to all other qualifying hospitals.

If the hospital is training residents in an approved residency program(s), it receives a percentage add-on payment for each case paid under the IPPS, known as the indirect medical education (IME) adjustment. This percentage varies, depending on the ratio of residents to beds.

Additional payments may be made for cases that involve new technologies or medical services that have been approved for special add-on payments. To qualify, a new technology or medical service must demonstrate that it is a substantial clinical improvement over technologies or services otherwise available, and that, absent an add-on payment, it would be inadequately paid under the regular DRG payment.

The costs incurred by the hospital for a case are evaluated to determine whether the hospital is eligible for an additional payment as an outlier case. This additional payment is designed to protect the hospital from large financial losses due to unusually expensive cases. Any eligible outlier payment is added to the DRG-adjusted base payment rate, plus any DSH, IME, and new technology or medical service add-on adjustments.

Although payments to most hospitals under the IPPS are made on the basis of the standardized amounts, some categories of hospitals are paid in whole or in part based on their hospital-specific rate, which is determined from their costs in a base year. For example, sole community hospitals (SCHs) Start Printed Page 19167receive the higher of a hospital-specific rate based on their costs in a base year (the highest of FY 1982, FY 1987, FY 1996, or FY 2006) or the IPPS Federal rate based on the standardized amount. SCHs are the sole source of care in their areas. Specifically, section 1886(d)(5)(D)(iii) of the Act defines an SCH as a hospital that is located more than 35 road miles from another hospital or that, by reason of factors such as an isolated location, weather conditions, travel conditions, or absence of other like hospitals (as determined by the Secretary), is the sole source of hospital inpatient services reasonably available to Medicare beneficiaries. In addition, certain rural hospitals previously designated by the Secretary as essential access community hospitals are considered SCHs.

Under current law, the Medicare-dependent, small rural hospital (MDH) program is effective through FY 2022. Through and including FY 2006, an MDH received the higher of the Federal rate or the Federal rate plus 50 percent of the amount by which the Federal rate was exceeded by the higher of its FY 1982 or FY 1987 hospital-specific rate. For discharges occurring on or after October 1, 2007, but before October 1, 2022, an MDH receives the higher of the Federal rate or the Federal rate plus 75 percent of the amount by which the Federal rate is exceeded by the highest of its FY 1982, FY 1987, or FY 2002 hospital-specific rate. MDHs are a major source of care for Medicare beneficiaries in their areas. Section 1886(d)(5)(G)(iv) of the Act defines an MDH as a hospital that is located in a rural area (or, as amended by the Bipartisan Budget Act of 2018, a hospital located in a State with no rural area that meets certain statutory criteria), has not more than 100 beds, is not an SCH, and has a high percentage of Medicare discharges (not less than 60 percent of its inpatient days or discharges in its cost reporting year beginning in FY 1987 or in two of its three most recently settled Medicare cost reporting years).

Section 1886(g) of the Act requires the Secretary to pay for the capital-related costs of inpatient hospital services in accordance with a prospective payment system established by the Secretary. The basic methodology for determining capital prospective payments is set forth in our regulations at 42 CFR 412.308 and 412.312. Under the capital IPPS, payments are adjusted by the same DRG for the case as they are under the operating IPPS. Capital IPPS payments are also adjusted for IME and DSH, similar to the adjustments made under the operating IPPS. In addition, hospitals may receive outlier payments for those cases that have unusually high costs.

The existing regulations governing payments to hospitals under the IPPS are located in 42 CFR part 412, subparts A through M.

2. Hospitals and Hospital Units Excluded From the IPPS

Under section 1886(d)(1)(B) of the Act, as amended, certain hospitals and hospital units are excluded from the IPPS. These hospitals and units are: Inpatient rehabilitation facility (IRF) hospitals and units; long-term care hospitals (LTCHs); psychiatric hospitals and units; children's hospitals; cancer hospitals; extended neoplastic disease care hospitals, and hospitals located outside the 50 States, the District of Columbia, and Puerto Rico (that is, hospitals located in the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa). Religious nonmedical health care institutions (RNHCIs) are also excluded from the IPPS. Various sections of the Balanced Budget Act of 1997 (BBA, Pub. L. 105-33), the Medicare, Medicaid and SCHIP [State Children's Health Insurance Program] Balanced Budget Refinement Act of 1999 (BBRA, Pub. L. 106-113), and the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA, Pub. L. 106-554) provide for the implementation of PPSs for IRF hospitals and units, LTCHs, and psychiatric hospitals and units (referred to as inpatient psychiatric facilities (IPFs)). (We note that the annual updates to the LTCH PPS are included along with the IPPS annual update in this document. Updates to the IRF PPS and IPF PPS are issued as separate documents.) Children's hospitals, cancer hospitals, hospitals located outside the 50 States, the District of Columbia, and Puerto Rico (that is, hospitals located in the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa), and RNHCIs continue to be paid solely under a reasonable cost-based system, subject to a rate-of-increase ceiling on inpatient operating costs. Similarly, extended neoplastic disease care hospitals are paid on a reasonable cost basis, subject to a rate-of-increase ceiling on inpatient operating costs.

The existing regulations governing payments to excluded hospitals and hospital units are located in 42 CFR parts 412 and 413.

3. Long-Term Care Hospital Prospective Payment System (LTCH PPS)

The Medicare prospective payment system (PPS) for LTCHs applies to hospitals described in section 1886(d)(1)(B)(iv) of the Act, effective for cost reporting periods beginning on or after October 1, 2002. The LTCH PPS was established under the authority of sections 123 of the BBRA and section 307(b) of the BIPA (as codified under section 1886(m)(1) of the Act). During the 5-year (optional) transition period, a LTCH's payment under the PPS was based on an increasing proportion of the LTCH Federal rate with a corresponding decreasing proportion based on reasonable cost principles. Effective for cost reporting periods beginning on or after October 1, 2006 through September 30, 2015 all LTCHs were paid 100 percent of the Federal rate. Section 1206(a) of the Pathway for SGR Reform Act of 2013 (Pub. L. 113-67) established the site neutral payment rate under the LTCH PPS, which made the LTCH PPS a dual rate payment system beginning in FY 2016. Under this statute, based on a rolling effective date that is linked to the date on which a given LTCH's Federal FY 2016 cost reporting period begins, LTCHs are generally paid for discharges at the site neutral payment rate unless the discharge meets the patient criteria for payment at the LTCH PPS standard Federal payment rate. The existing regulations governing payment under the LTCH PPS are located in 42 CFR part 412, subpart O. Beginning October 1, 2009, we issue the annual updates to the LTCH PPS in the same documents that update the IPPS (73 FR 26797 through 26798).

4. Critical Access Hospitals (CAHs)

Under sections 1814(l), 1820, and 1834(g) of the Act, payments made to critical access hospitals (CAHs) (that is, rural hospitals or facilities that meet certain statutory requirements) for inpatient and outpatient services are generally based on 101 percent of reasonable cost. Reasonable cost is determined under the provisions of section 1861(v) of the Act and existing regulations under 42 CFR part 413.

5. Payments for Graduate Medical Education (GME)

Under section 1886(a)(4) of the Act, costs of approved educational activities are excluded from the operating costs of inpatient hospital services. Hospitals with approved graduate medical education (GME) programs are paid for the direct costs of GME in accordance with section 1886(h) of the Act. The amount of payment for direct GME costs for a cost reporting period is based on the hospital's number of residents in that period and the hospital's costs per resident in a base year. The existing regulations governing payments to the Start Printed Page 19168various types of hospitals are located in 42 CFR part 413.

C. Summary of Provisions of Recent Legislation That Would Be Implemented in This Proposed Rule

1. Pathway for SGR Reform Act of 2013 (Pub. L. 113-67)

The Pathway for SGR Reform Act of 2013 (Pub. L. 113-67) introduced new payment rules in the LTCH PPS. Under section 1206 of this law, discharges in cost reporting periods beginning on or after October 1, 2015, under the LTCH PPS, receive payment under a site neutral rate unless the discharge meets certain patient-specific criteria. In this proposed rule, we are proposing to continue to update certain policies that implemented provisions under section 1206 of the Pathway for SGR Reform Act.

2. Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act) (Pub. L. 113-185)

The Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act) (Pub. L. 113-185), enacted on October 6, 2014, made a number of changes that affect the Long-Term Care Hospital Quality Reporting Program (LTCH QRP). In this proposed rule, we are proposing to continue to implement portions of section 1899B of the Act, as added by section 2(a) of the IMPACT Act, which, in part, requires LTCHs, among other post-acute care providers, to report standardized patient assessment data, data on quality measures, and data on resource use and other measures.

3. The Medicare Access and CHIP Reauthorization Act of 2015 (Pub. L. 114-10)

Section 414 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA, Pub. L. 114-10) specifies a 0.5 percent positive adjustment to the standardized amount of Medicare payments to acute care hospitals for FYs 2018 through 2023. These adjustments follow the recoupment adjustment to the standardized amounts under section 1886(d) of the Act based upon the Secretary's estimates for discharges occurring from FYs 2014 through 2017 to fully offset $11 billion, in accordance with section 631 of the ATRA. The FY 2018 adjustment was subsequently adjusted to 0.4588 percent by section 15005 of the 21st Century Cures Act.

4. The 21st Century Cures Act (Pub. L. 114-255)

The 21st Century Cures Act (Pub. L. 114-255), enacted on December 13, 2016, contained the following provision affecting payments under the Hospital Readmissions Reduction Program, which we are proposing to continue to implement in this proposed rule:

  • Section 15002, which amended section 1886(q)(3) of the Act by adding subparagraphs (D) and (E), which requires the Secretary to develop a methodology for calculating the excess readmissions adjustment factor for the Hospital Readmissions Reduction Program based on cohorts defined by the percentage of dual-eligible patients (that is, patients who are eligible for both Medicare and full-benefit Medicaid coverage) cared for by a hospital. In this proposed rule, we are proposing to continue to implement changes to the payment adjustment factor to assess penalties based on a hospital's performance, relative to other hospitals treating a similar proportion of dual-eligible patients.

D. Summary of the Provisions of This Proposed Rule

In this proposed rule, we set forth proposed payment and policy changes to the Medicare IPPS for FY 2020 operating costs and capital-related costs of acute care hospitals and certain hospitals and hospital units that are excluded from IPPS. In addition, we set forth proposed changes to the payment rates, factors, and other payment and policy-related changes to programs associated with payment rate policies under the LTCH PPS for FY 2020.

Below is a general summary of the changes that we are proposing to make in this proposed rule.

1. Proposed Changes to MS-DRG Classifications and Recalibrations of Relative Weights

In section II. of the preamble of this proposed rule, we include—

  • Proposed changes to MS-DRG classifications based on our yearly review for FY 2020.
  • Proposed adjustment to the standardized amounts under section 1886(d) of the Act for FY 2020 in accordance with the amendments made to section 7(b)(1)(B) of Public Law 110-90 by section 414 of the MACRA.
  • Proposed recalibration of the MS-DRG relative weights.
  • A discussion of the proposed FY 2020 status of new technologies approved for add-on payments for FY 2019 and a presentation of our evaluation and analysis of the FY 2020 applicants for add-on payments for high-cost new medical services and technologies (including public input, as directed by Pub. L. 108-173, obtained in a town hall meeting).
  • A request for public comments on the substantial clinical improvement criterion used to evaluate applications for both the IPPS new technology add-on payments and the OPPS transitional pass-through payment for devices, and a discussion of potential revisions that we are considering adopting as final policies related to the substantial clinical improvement criterion for applications received beginning in FY 2020 for the IPPS (that is, for FY 2021 and later new technology add-on payments) and beginning in CY 2020 for the OPPS.
  • A proposed alternative IPPS new technology add-on payment pathway for certain transformative new devices.
  • Proposed changes to the calculation of the IPPS new technology add-on payment.

2. Proposed Changes to the Hospital Wage Index for Acute Care Hospitals

In section III. of the preamble to this proposed rule, we are proposing to make revisions to the wage index for acute care hospitals and the annual update of the wage data. Specific issues addressed include, but are not limited to, the following:

  • The proposed FY 2020 wage index update using wage data from cost reporting periods beginning in FY 2016.
  • Proposals to address wage index disparities between high and low wage index hospitals.
  • Calculation, analysis, and implementation of the proposed occupational mix adjustment to the wage index for acute care hospitals for FY 2020 based on the 2016 Occupational Mix Survey.
  • Proposed application of the rural floor and the frontier State floor.
  • Proposed revisions to the wage index for acute care hospitals, based on hospital redesignations and reclassifications under sections 1886(d)(8)(B), (d)(8)(E), and (d)(10) of the Act.
  • Proposed change to Lugar county assignments.
  • Proposed adjustment to the wage index for acute care hospitals for FY 2020 based on commuting patterns of hospital employees who reside in a county and work in a different area with a higher wage index.
  • Proposed labor-related share for the proposed FY 2020 wage index.

3. Other Decisions and Proposed Changes to the IPPS for Operating Costs

In section IV. of the preamble of this proposed rule, we discuss proposed changes or clarifications of a number of the provisions of the regulations in 42 Start Printed Page 19169CFR parts 412 and 413, including the following:

  • Proposed changes to MS-DRGs subject to the postacute care transfer policy and special payment policy.
  • Proposed changes to the inpatient hospital update for FY 2020.
  • Proposed conforming changes to the regulations for the low-volume hospital payment adjustment policy.
  • Proposed updated national and regional case-mix values and discharges for purposes of determining RRC status.
  • The statutorily required IME adjustment factor for FY 2020.
  • Proposed changes to the methodologies for determining Medicare DSH payments and the additional payments for uncompensated care.
  • A request for public comments on PRRB appeals related to a hospital's Medicaid fraction in the DSH payment adjustment calculation.
  • Proposed changes to the policies for payment adjustments under the Hospital Readmissions Reduction Program based on hospital readmission measures and the process for hospital review and correction of those rates for FY 2020.
  • Proposed changes to the requirements and provision of value-based incentive payments under the Hospital Value-Based Purchasing Program.
  • Proposed requirements for payment adjustments to hospitals under the HAC Reduction Program for FY 2020.
  • Proposed changes related to CAHs as nonproviders for direct GME and IME payment purposes.
  • Discussion of and proposals relating to the implementation of the Rural Community Hospital Demonstration Program in FY 2020.

4. Proposed FY 2020 Policy Governing the IPPS for Capital-Related Costs

In section V. of the preamble to this proposed rule, we discuss the proposed payment policy requirements for capital-related costs and capital payments to hospitals for FY 2020.

5. Proposed Changes to the Payment Rates for Certain Excluded Hospitals: Rate-of-Increase Percentages

In section VI. of the preamble of this proposed rule, we discuss—

  • Proposed changes to payments to certain excluded hospitals for FY 2020.
  • Proposed change related to CAH payment for ambulance services.
  • Proposed continued implementation of the Frontier Community Health Integration Project (FCHIP) Demonstration.

6. Proposed Changes to the LTCH PPS

In section VII. of the preamble of this proposed rule, we set forth—

  • Proposed changes to the LTCH PPS Federal payment rates, factors, and other payment rate policies under the LTCH PPS for FY 2020.
  • Proposed payment adjustment for discharges of LTCHs that do not meet the applicable discharge payment percentage.

7. Proposed Changes Relating to Quality Data Reporting for Specific Providers and Suppliers

In section VIII. of the preamble of this proposed rule, we address—

  • Proposed requirements for the Hospital Inpatient Quality Reporting (IQR) Program.
  • Proposed changes to the requirements for the quality reporting program for PPS-exempt cancer hospitals (PCHQR Program).
  • Proposed changes to the requirements under the LTCH Quality Reporting Program (LTCH QRP).
  • Proposed changes to requirements pertaining to eligible hospitals and CAHs participating in the Medicare and Medicaid Promoting Interoperability Programs.

8. Provider Reimbursement Review Board Appeals

In section XI. of the preamble of this proposed rule, we discuss the growing number of Provider Reimbursement Review Board appeals made by providers and the action initiatives that are being implemented with the goal to: decrease the number of appeals submitted; decrease the number of appeals in inventory; reduce the time to resolution; and increase customer satisfaction.

9. Determining Prospective Payment Operating and Capital Rates and Rate-of-Increase Limits for Acute Care Hospitals

In sections II. and III. of the Addendum to this proposed rule, we set forth the proposed changes to the amounts and factors for determining the proposed FY 2020 prospective payment rates for operating costs and capital-related costs for acute care hospitals. We are proposing to establish the threshold amounts for outlier cases, including a proposed change to the methodology for calculating those threshold amounts for FY 2020 to incorporate a projection of outlier payment reconciliations. In addition, in section IV. of the Addendum to this proposed rule, we address the update factors for determining the rate-of-increase limits for cost reporting periods beginning in FY 2020 for certain hospitals excluded from the IPPS.

10. Determining Prospective Payment Rates for LTCHs

In section V. of the Addendum to this proposed rule, we set forth proposed changes to the amounts and factors for determining the proposed FY 2020 LTCH PPS standard Federal payment rate and other factors used to determine LTCH PPS payments under both the LTCH PPS standard Federal payment rate and the site neutral payment rate in FY 2020. We are proposing to establish the adjustments for wage levels, the labor-related share, the cost-of-living adjustment, and high-cost outliers, including the applicable fixed-loss amounts and the LTCH cost-to-charge ratios (CCRs) for both payment rates.

11. Impact Analysis

In Appendix A of this proposed rule, we set forth an analysis of the impact the proposed changes would have on affected acute care hospitals, CAHs, LTCHs, and PCHs.

12. Recommendation of Update Factors for Operating Cost Rates of Payment for Hospital Inpatient Services

In Appendix B of this proposed rule, as required by sections 1886(e)(4) and (e)(5) of the Act, we provide our recommendations of the appropriate percentage changes for FY 2020 for the following:

  • A single average standardized amount for all areas for hospital inpatient services paid under the IPPS for operating costs of acute care hospitals (and hospital-specific rates applicable to SCHs and MDHs).
  • Target rate-of-increase limits to the allowable operating costs of hospital inpatient services furnished by certain hospitals excluded from the IPPS.
  • The LTCH PPS standard Federal payment rate and the site neutral payment rate for hospital inpatient services provided for LTCH PPS discharges.

13. Discussion of Medicare Payment Advisory Commission Recommendations

Under section 1805(b) of the Act, MedPAC is required to submit a report to Congress, no later than March 15 of each year, in which MedPAC reviews and makes recommendations on Medicare payment policies. MedPAC's March 2019 recommendations concerning hospital inpatient payment policies addressed the update factor for hospital inpatient operating costs and capital-related costs for hospitals under the IPPS. We address these Start Printed Page 19170recommendations in Appendix B of this proposed rule. For further information relating specifically to the MedPAC March 2019 report or to obtain a copy of the report, contact MedPAC at (202) 220-3700 or visit MedPAC's website at: http://www.medpac.gov.

E. Advancing Health Information Exchange

The Department of Health and Human Services (HHS) has a number of initiatives designed to encourage and support the adoption of interoperable health information technology and to promote nationwide health information exchange to improve health care. The Office of the National Coordinator for Health Information Technology (ONC) and CMS work collaboratively to advance interoperability across settings of care, including post-acute care.

To further interoperability in post-acute care, we developed a Data Element Library (DEL) to serve as a publicly available centralized, authoritative resource for standardized data elements and their associated mappings to health IT standards. The DEL furthers CMS' goal of data standardization and interoperability, which is also a goal of the IMPACT Act. These interoperable data elements can reduce provider burden by allowing the use and exchange of health care data, support provider exchange of electronic health information for care coordination, person-centered care, and support real-time, data driven, clinical decision making. Standards in the Data Element Library (https://del.cms.gov/​) can be referenced on the CMS website and in the ONC Interoperability Standards Advisory (ISA). The 2019 ISA is available at: https://www.healthit.gov/​isa.

The 21st Century Cures Act (the Cures Act) (Pub. L. 114-255, enacted December 13, 2016) requires HHS to take new steps to enable the electronic sharing of health information ensuring interoperability for providers and settings across the care continuum. In an important provision, Congress defined “information blocking” as practices likely to interfere with, prevent, or materially discourage access, exchange, or use of electronic health information, and established new authority for HHS to discourage these practices. In March 2019, ONC and CMS published the proposed rules, “21st Century Cures Act: Interoperability, Information Blocking, and the ONC Health IT Certification Program” (84 FR 7424 through 7610) and “Interoperability and Patient Access” (84 FR 7610 through 7680), to promote secure and more immediate access to health information for patients and health care providers through the implementation of information blocking provisions of the Cures Act and the use of standardized application programming interfaces (APIs) that enable easier access to electronic health information. These two proposed rules are open for public comments at: www.regulations.gov.

We invite providers to learn more about these important developments and how they are likely to affect hospitals paid under the IPPS and the LTCH PPS.

II. Proposed Changes to Medicare Severity Diagnosis-Related Group (MS-DRG) Classifications and Relative Weights

A. Background

Section 1886(d) of the Act specifies that the Secretary shall establish a classification system (referred to as diagnosis-related groups (DRGs)) for inpatient discharges and adjust payments under the IPPS based on appropriate weighting factors assigned to each DRG. Therefore, under the IPPS, Medicare pays for inpatient hospital services on a rate per discharge basis that varies according to the DRG to which a beneficiary's stay is assigned. The formula used to calculate payment for a specific case multiplies an individual hospital's payment rate per case by the weight of the DRG to which the case is assigned. Each DRG weight represents the average resources required to care for cases in that particular DRG, relative to the average resources used to treat cases in all DRGs.

Section 1886(d)(4)(C) of the Act requires that the Secretary adjust the DRG classifications and relative weights at least annually to account for changes in resource consumption. These adjustments are made to reflect changes in treatment patterns, technology, and any other factors that may change the relative use of hospital resources.

B. MS-DRG Reclassifications

For general information about the MS-DRG system, including yearly reviews and changes to the MS-DRGs, we refer readers to the previous discussions in the FY 2010 IPPS/RY 2010 LTCH PPS final rule (74 FR 43764 through 43766) and the FYs 2011 through 2019 IPPS/LTCH PPS final rules (75 FR 50053 through 50055; 76 FR 51485 through 51487; 77 FR 53273; 78 FR 50512; 79 FR 49871; 80 FR 49342; 81 FR 56787 through 56872; 82 FR 38010 through 38085, and 83 FR 41158 through 41258, respectively).

C. Adoption of the MS-DRGs in FY 2008

For information on the adoption of the MS-DRGs in FY 2008, we refer readers to the FY 2008 IPPS final rule with comment period (72 FR 47140 through 47189).

D. Proposed FY 2020 MS-DRG Documentation and Coding Adjustment

1. Background on the Prospective MS-DRG Documentation and Coding Adjustments for FY 2008 and FY 2009 Authorized by Public Law 110-90 and the Recoupment or Repayment Adjustment Authorized by Section 631 of the American Taxpayer Relief Act of 2012 (ATRA)

In the FY 2008 IPPS final rule with comment period (72 FR 47140 through 47189), we adopted the MS-DRG patient classification system for the IPPS, effective October 1, 2007, to better recognize severity of illness in Medicare payment rates for acute care hospitals. The adoption of the MS-DRG system resulted in the expansion of the number of DRGs from 538 in FY 2007 to 745 in FY 2008. By increasing the number of MS-DRGs and more fully taking into account patient severity of illness in Medicare payment rates for acute care hospitals, MS-DRGs encourage hospitals to improve their documentation and coding of patient diagnoses.

In the FY 2008 IPPS final rule with comment period (72 FR 47175 through 47186), we indicated that the adoption of the MS-DRGs had the potential to lead to increases in aggregate payments without a corresponding increase in actual patient severity of illness due to the incentives for additional documentation and coding. In that final rule with comment period, we exercised our authority under section 1886(d)(3)(A)(vi) of the Act, which authorizes us to maintain budget neutrality by adjusting the national standardized amount, to eliminate the estimated effect of changes in coding or classification that do not reflect real changes in case-mix. Our actuaries estimated that maintaining budget neutrality required an adjustment of −4.8 percentage points to the national standardized amount. We provided for phasing in this −4.8 percentage point adjustment over 3 years. Specifically, we established prospective documentation and coding adjustments of −1.2 percentage points for FY 2008, −1.8 percentage points for FY 2009, and −1.8 percentage points for FY 2010.

On September 29, 2007, Congress enacted the TMA [Transitional Medical Assistance], Abstinence Education, and Start Printed Page 19171QI [Qualifying Individuals] Programs Extension Act of 2007 (Pub. L. 110-90). Section 7(a) of Public Law 110-90 reduced the documentation and coding adjustment made as a result of the MS-DRG system that we adopted in the FY 2008 IPPS final rule with comment period to −0.6 percentage point for FY 2008 and −0.9 percentage point for FY 2009.

As discussed in prior year rulemakings, and most recently in the FY 2017 IPPS/LTCH PPS final rule (81 FR 56780 through 56782), we implemented a series of adjustments required under sections 7(b)(1)(A) and 7(b)(1)(B) of Public Law 110-90, based on a retrospective review of FY 2008 and FY 2009 claims data. We completed these adjustments in FY 2013 but indicated in the FY 2013 IPPS/LTCH PPS final rule (77 FR 53274 through 53275) that delaying full implementation of the adjustment required under section 7(b)(1)(A) of Public Law 110-90 until FY 2013 resulted in payments in FY 2010 through FY 2012 being overstated, and that these overpayments could not be recovered under Public Law 110-90.

In addition, as discussed in prior rulemakings and most recently in the FY 2018 IPPS/LTCH PPS final rule (82 FR 38008 through 38009), section 631 of the ATRA amended section 7(b)(1)(B) of Public Law 110-90 to require the Secretary to make a recoupment adjustment or adjustments totaling $11 billion by FY 2017. This adjustment represented the amount of the increase in aggregate payments as a result of not completing the prospective adjustment authorized under section 7(b)(1)(A) of Public Law 110-90 until FY 2013.

2. Adjustments Made for FY 2018 and FY 2019 as Required Under Section 414 of Public Law 114-10 (MACRA) and Section 15005 of Public Law 114-255

As stated in the FY 2017 IPPS/LTCH PPS final rule (81 FR 56785), once the recoupment required under section 631 of the ATRA was complete, we had anticipated making a single positive adjustment in FY 2018 to offset the reductions required to recoup the $11 billion under section 631 of the ATRA. However, section 414 of the MACRA (which was enacted on April 16, 2015) replaced the single positive adjustment we intended to make in FY 2018 with a 0.5 percentage point positive adjustment for each of FYs 2018 through 2023. In the FY 2017 rulemaking, we indicated that we would address the adjustments for FY 2018 and later fiscal years in future rulemaking. Section 15005 of the 21st Century Cures Act (Pub. L. 114-255), which was enacted on December 13, 2016, amended section 7(b)(1)(B) of the TMA, as amended by section 631 of the ATRA and section 414 of the MACRA, to reduce the adjustment for FY 2018 from a 0.5 percentage point positive adjustment to a 0.4588 percentage point positive adjustment. As we discussed in the FY 2018 rulemaking, we believe the directive under section 15005 of Public Law 114-255 is clear. Therefore, in the FY 2018 IPPS/LTCH PPS final rule (82 FR 38009) for FY 2018, we implemented the required +0.4588 percentage point adjustment to the standardized amount. In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41157), consistent with the requirements of section 414 of the MACRA, we implemented a 0.5 percentage point positive adjustment to the standardized amount for FY 2019. We indicated that both the FY 2018 and FY 2019 adjustments were permanent adjustments to payment rates. We also stated that we plan to propose future adjustments required under section 414 of the MACRA for FYs 2020 through 2023 in future rulemaking.

3. Proposed Adjustment for FY 2020

Consistent with the requirements of section 414 of the MACRA, we are proposing to implement a 0.5 percentage point positive adjustment to the standardized amount for FY 2020. This would constitute a permanent adjustment to payment rates. We plan to propose future adjustments required under section 414 of the MACRA for FYs 2021 through 2023 in future rulemaking.

E. Refinement of the MS-DRG Relative Weight Calculation

1. Background

Beginning in FY 2007, we implemented relative weights for DRGs based on cost report data instead of charge information. We refer readers to the FY 2007 IPPS final rule (71 FR 47882) for a detailed discussion of our final policy for calculating the cost-based DRG relative weights and to the FY 2008 IPPS final rule with comment period (72 FR 47199) for information on how we blended relative weights based on the CMS DRGs and MS-DRGs. We also refer readers to the FY 2017 IPPS/LTCH PPS final rule (81 FR 56785 through 56787) for a detailed discussion of the history of changes to the number of cost centers used in calculating the DRG relative weights. Since FY 2014, we have calculated the IPPS MS-DRG relative weights using 19 CCRs, which now include distinct CCRs for implantable devices, MRIs, CT scans, and cardiac catheterization.

2. Discussion of Policy for FY 2020

Consistent with our established policy, we are calculating the proposed MS-DRG relative weights for FY 2020 using two data sources: The MedPAR file as the claims data source and the HCRIS as the cost report data source. We adjust the charges from the claims to costs by applying the 19 national average CCRs developed from the cost reports. The description of the calculation of the proposed 19 CCRs and the proposed MS-DRG relative weights for FY 2020 is included in section II.G. of the preamble to this FY 2020 IPPS/LTCH PPS proposed rule. As we did with the FY 2019 IPPS/LTCH PPS final rule, for this FY 2020 proposed rule, we are providing the version of the HCRIS from which we calculated these proposed 19 CCRs on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html. Click on the link on the left side of the screen titled “FY 2020 IPPS Proposed Rule Home Page” or “Acute Inpatient Files for Download.”

F. Proposed Changes to Specific MS-DRG Classifications

1. Discussion of Changes to Coding System and Basis for Proposed FY 2020 MS-DRG Updates

a. Conversion of MS-DRGs to the International Classification of Diseases, 10th Revision (ICD-10)

As of October 1, 2015, providers use the International Classification of Diseases, 10th Revision (ICD-10) coding system to report diagnoses and procedures for Medicare hospital inpatient services under the MS-DRG system instead of the ICD-9-CM coding system, which was used through September 30, 2015. The ICD-10 coding system includes the International Classification of Diseases, 10th Revision, Clinical Modification (ICD-10-CM) for diagnosis coding and the International Classification of Diseases, 10th Revision, Procedure Coding System (ICD-10-PCS) for inpatient hospital procedure coding, as well as the ICD-10-CM and ICD-10-PCS Official Guidelines for Coding and Reporting. For a detailed discussion of the conversion of the MS-DRGs to ICD-10, we refer readers to the FY 2017 IPPS/LTCH PPS final rule (81 FR 56787 through 56789).

b. Basis for Proposed FY 2020 MS-DRG Updates

CMS has previously encouraged input from our stakeholders concerning the annual IPPS updates when that input was made available to us by December Start Printed Page 191727 of the year prior to the next annual proposed rule update. As discussed in the FY 2018 IPPS/LTCH PPS final rule (82 FR 38010), as we work with the public to examine the ICD-10 claims data used for updates to the ICD-10 MS DRGs, we would like to examine areas where the MS-DRGs can be improved, which will require additional time for us to review requests from the public to make specific updates, analyze claims data, and consider any proposed updates. Given the need for more time to carefully evaluate requests and propose updates, we changed the deadline to request updates to the MS-DRGs to November 1 of each year. This will provide an additional 5 weeks for the data analysis and review process. Interested parties had to submit any comments and suggestions for FY 2020 by November 1, 2018, and should submit any comments and suggestions for FY 2021 by November 1, 2019 via the CMS MS-DRG Classification Change Request Mailbox located at: MSDRGClassificationChange@cms.hhs.gov. The comments that were submitted in a timely manner for FY 2020 are discussed in this section of the preamble of this proposed rule. As we discuss in the sections that follow, we may not be able to fully consider all of the requests that we receive for the upcoming fiscal year. We have found that, with the implementation of ICD-10, some types of requested changes to the MS-DRG classifications require more extensive research to identify and analyze all of the data that are relevant to evaluating the potential change. We note in the discussion that follows those topics for which further research and analysis are required, and which we will continue to consider in connection with future rulemaking.

Following are the changes that we are proposing to the MS-DRGs for FY 2020. We are inviting public comments on each of the MS-DRG classification proposed changes, as well as our proposals to maintain certain existing MS-DRG classifications discussed in this proposed rule. In some cases, we are proposing changes to the MS-DRG classifications based on our analysis of claims data and consultation with our clinical advisors. In other cases, we are proposing to maintain the existing MS-DRG classifications based on our analysis of claims data and consultation with our clinical advisors. For this FY 2020 IPPS/LTCH PPS proposed rule, our MS-DRG analysis was based on ICD-10 claims data from the September 2018 update of the FY 2018 MedPAR file, which contains hospital bills received through September 30, 2018, for discharges occurring through September 30, 2018. In our discussion of the proposed MS-DRG reclassification changes, we refer to these claims data as the “September 2018 update of the FY 2018 MedPAR file.”

As explained in previous rulemaking (76 FR 51487), in deciding whether to propose to make further modifications to the MS-DRGs for particular circumstances brought to our attention, we consider whether the resource consumption and clinical characteristics of the patients with a given set of conditions are significantly different than the remaining patients represented in the MS-DRG. We evaluate patient care costs using average costs and lengths of stay and rely on the judgment of our clinical advisors to determine whether patients are clinically distinct or similar to other patients represented in the MS-DRG. In evaluating resource costs, we consider both the absolute and percentage differences in average costs between the cases we select for review and the remainder of cases in the MS-DRG. We also consider variation in costs within these groups; that is, whether observed average differences are consistent across patients or attributable to cases that are extreme in terms of costs or length of stay, or both. Further, we consider the number of patients who will have a given set of characteristics and generally prefer not to create a new MS-DRG unless it would include a substantial number of cases.

In our examination of the claims data, we apply the following criteria established in FY 2008 (72 FR 47169) to determine if the creation of a new complication or comorbidity (CC) or major complication or comorbidity (MCC) subgroup within a base MS-DRG is warranted:

  • A reduction in variance of costs of at least 3 percent;
  • At least 5 percent of the patients in the MS-DRG fall within the CC or MCC subgroup;
  • At least 500 cases are in the CC or MCC subgroup;
  • There is at least a 20-percent difference in average costs between subgroups; and
  • There is a $2,000 difference in average costs between subgroups.

In order to warrant creation of a CC or MCC subgroup within a base MS-DRG, the subgroup must meet all five of the criteria.

2. Pre-MDC

a. Peripheral ECMO

In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41166 through 41169), we discussed a request we received to review cases reporting the use of extracorporeal membrane oxygenation (ECMO) in combination with the insertion of a percutaneous short-term external heart assist device. We also noted that a separate request to create a new ICD-10-PCS procedure code specifically for percutaneous ECMO was discussed at the March 6-7, 2018 ICD-10 Coordination and Maintenance Committee Meeting for which we finalized the creation of three new procedure codes to identify and describe different types of ECMO treatments currently being utilized. These three new procedure codes were included in the FY 2019 ICD-10-PCS procedure codes files (which are available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Coding/​ICD10/​2019-ICD-10-PCS.html) and were made publicly available in May 2018. We received recommendations from commenters on suggested MS-DRG assignments for the two new procedure codes that uniquely identify percutaneous (peripheral) ECMO, including assignment to MS-DRG 215 (Other Heart Assist System Implant), or to Pre-MDC MS-DRG 004 (Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck without Major O.R. Procedure) specifically for the new procedure code describing percutaneous veno-venous (VV) ECMO or an alternate MS-DRG within MDC 4 (Diseases and Disorders of the Respiratory System). In our response, we noted that because these codes were not finalized at the time of the proposed rule, there were no proposed MDC or MS-DRG assignments or O.R. and non-O.R. designations for these new procedure codes and they were not reflected in Table 6B.—New Procedure Codes (which is available via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html) associated with the FY 2019 IPPS/LTCH PPS proposed rule.

We further noted that, consistent with our annual process of assigning new procedure codes to MDCs and MS-DRGs, and designating a procedure as an O.R. or non-O.R. procedure, we reviewed the predecessor procedure code assignment. For the reasons discussed in the FY 2019 IPPS/LTCH PPS final rule, our clinical advisors did not support assigning the new procedure codes for the percutaneous (peripheral) ECMO procedures to the same MS-DRG as the predecessor code for open (central) ECMO in pre-MDC MS-DRG 003.Start Printed Page 19173

Effective with discharges occurring on and after October 1, 2018, the three ECMO procedure codes and their corresponding MS-DRG assignments are as shown in the following table.

ICD-10-PCS codeCode descriptionMS-DRGMS-DRG description
5A1522FExtracorporeal Oxygenation, Membrane, CentralPre-MDC MS-DRG 003ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure.
5A1522GExtracorporeal Oxygenation, Membrane, Peripheral Veno-arterialMS-DRG 207Respiratory System Diagnosis with Ventilator Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 291Heart Failure and Shock with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 296Cardiac Arrest, Unexplained with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 870Septicemia Or Severe Sepsis with Mechanical Ventilation >96 Hours Or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
5A1522HExtracorporeal Oxygenation, Membrane, Peripheral Veno-venousMS-DRG 207Respiratory System Diagnosis with Ventilator Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 291Heart Failure and Shock with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 296Cardiac Arrest, Unexplained with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO).
MS-DRG 870Septicemia Or Severe Sepsis with Mechanical Ventilation >96 Hours Or Peripheral Extracorporeal Membrane Oxygenation (ECMO).

After publication of the FY 2019 IPPS/LTCH PPS final rule, we received comments and feedback from stakeholders expressing concern with the MS-DRG assignments for the two new procedure codes describing peripheral ECMO. Specifically, these stakeholders stated that: (1) The MS-DRG assignments for ECMO should not be based on how the patient is cannulated (open versus peripheral) because most of the costs for both central and peripheral ECMO can be attributed to the severity of illness of the patient; (2) there was a lack of opportunity for public comment on the finalized MS-DRG assignments; (3) patient access to ECMO treatment and programs is now at risk because of inadequate payment; and (4) CMS did not appear to have access to enough patient data to evaluate for appropriate MS-DRG assignment consideration. They also stated that the new procedure codes do not account for an open cut-down approach that may be performed on a peripheral vessel during a peripheral ECMO procedure. These stakeholders recommended that, consistent with the usual process of assigning new procedure codes to the same MS-DRG as the predecessor code, the MS-DRG assignment for peripheral ECMO procedures should be revised to allow assignment of peripheral ECMO procedures to Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure). They stated that this revision would also allow for the collection of further claims data for patients treated with ECMO and assist in determining the appropriateness of any future modifications in MS-DRG assignment.

We also received feedback from a few stakeholders that, for some cases involving peripheral ECMO, the current designation provides compensation that these stakeholders believe is “reasonable” (for example, for peripheral ECMO in certain patients admitted with acute respiratory failure and sepsis). Some of these stakeholders agreed with CMS that once claims data become available, the volume, length of stay and cost data of claims with these new codes can be examined to determine if modifications to MS-DRG assignment or O.R. and non-O.R. designation are warranted. However, some of these stakeholders also expressed concerns that the current assignments and designation do not appropriately compensate for the resources used when peripheral ECMO is used to treat certain patients (for example, patients who are admitted with cardiac arrest and cardiogenic shock of known cause or patients admitted with a different principal diagnosis or patients who develop a diagnosis after admission that requires ECMO). These stakeholders stated that the current MS-DRG assignments for such cases involving peripheral ECMO do not provide sufficient payment and do not fully consider the severity of illness of the patient and the level of resources involved in treating such patients, such as surgical team, general anesthesia, and other ECMO support such as specialized monitoring.

With regard to stakeholders' concerns that we did not allow the opportunity for public comment on the MS-DRG assignment for the three new procedure codes that describe central and peripheral ECMO, as noted above and as explained in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41168), these new procedure codes were not finalized at the time of the proposed rule. We note that although there were no proposed MDC or MS-DRG assignment or O.R. and non-O.R. designations for these three new procedure codes, we did, in fact, review and respond to comments on the recommended MDC and MS-DRG assignments and O.R./non-O.R. designations in the final rule (83 FR 41168 through 41169). For FY 2019, consistent with our annual process of assigning new procedure codes to MDCs and MS-DRGs and designating a procedure as an O.R. or non-O.R. procedure, we reviewed the predecessor procedure code assignments. Upon completing the review, our clinical advisors did not support assigning the two new ICD-10-PCS procedure codes for peripheral ECMO procedures to the same MS-DRG as the predecessor code for open (central) ECMO procedures. Further, our clinical advisors also did not agree with designating peripheral Start Printed Page 19174ECMO procedures as O.R. procedures because they stated that these procedures are less resource intensive compared to open ECMO procedures.

As noted, our annual process for assigning new procedure codes involves review of the predecessor procedure code's MS-DRG assignment. However, this process does not automatically result in the new procedure code being assigned (or proposed for assignment) to the same MS-DRG as the predecessor code. There are several factors to consider during this process that our clinical advisors take into account. For example, in the absence of volume, length of stay, and cost data, they may consider the specific service, procedure, or treatment being described by the new procedure code, the indications, treatment difficulty, and the resources utilized. We have continued to consider how these and other factors may apply in the context of classifying procedures under the ICD-10 MS-DRGs, including with regard to the specific concerns raised by stakeholders.

In the absence of claims data for the new ICD-10-PCS procedure codes describing peripheral ECMO, we analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting the predecessor ICD-10-PCS procedure code 5A15223 (Extracorporeal membrane oxygenation, continuous) in Pre-MDC MS-DRG 003, including those cases reporting secondary diagnosis MCC and CC conditions, that were grouped under the ICD-10 MS-DRG Version 35 GROUPER. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 003—All cases14,45629.6$122,168
MS-DRG 003—Cases reporting procedure code 5A15223 (Extracorporeal membrane oxygenation, continuous)2,08620.2128,168
MS-DRG 003—Cases reporting procedure code 5A15223 (Extracorporeal membrane oxygenation, continuous) with MCC2,00020.7131,305
MS-DRG 003—Cases reporting procedure code 5A15223 (Extracorporeal membrane oxygenation, continuous) with CC797.658,231

The total number of cases reported in MS-DRG 003 was 14,456, with an average length of stay of 29.6 days and average costs of $122,168. For the cases reporting procedure code 5A15223 (Extracorporeal membrane oxygenation, continuous), there was a total of 2,086 cases, with an average length of stay of 20.2 days and average costs of $128,168. For the cases reporting procedure code 5A15223 with an MCC, there was a total of 2,000 cases, with an average length of stay of 20.7 days and average costs of $131,305. For the cases reporting procedure code 5A15223 with a CC, there was a total of 79 cases, with an average length of stay of 7.6 days and average costs of $58,231.

Our clinical advisors reviewed these data and noted that the average length of stay for the cases reporting ECMO with procedure code 5A15223 of 20.2 days may not necessarily be a reliable indicator of resources that can be attributed to ECMO treatment. Our clinical advisors believed that a more appropriate measure of resource consumption for ECMO would be the number of hours or days that a patient was specifically receiving ECMO treatment, rather than the length of hospital stay. However, they noted that this information is not currently available in the claims data. Our clinical advisors also stated that the average costs of $128,168 for the cases reporting ECMO with procedure code 5A15223 are not necessarily reflective of the resources utilized for ECMO treatment alone, as the average costs represent a combination of factors, including the principal diagnosis, any secondary diagnosis CC and/or MCC conditions necessitating initiation of ECMO, and potentially any other procedures that may be performed during the hospital stay. Our clinical advisors recognized that patients who require ECMO treatment are severely ill and recommended we review the claims data to identify the number (frequency) and types of principal and secondary diagnosis CC and/or MCC conditions that were reported among the 2,086 cases reporting procedure code 5A15223. Our findings are shown in the following tables for the top 10 principal diagnosis codes, followed by the top 10 secondary diagnosis MCC and secondary diagnosis CC conditions that were reported within the claims data with procedure code 5A15223.

Top 10 Principal Diagnosis Codes Reported With Procedure Code 5A1223

[Extracorporeal membrane oxygenation, continuous]

ICD-10-CM codeDescriptionNumber of times reported
A41.9Sepsis, unspecified organism145
I21.4Non-ST elevation (NSTEMI) myocardial infarction137
I35.0Nonrheumatic aortic (valve) stenosis81
J84.112Idiopathic pulmonary fibrosis68
I25.110Atherosclerotic heart disease of native coronary artery with unstable angina pectoris55
J96.01Acute respiratory failure with hypoxia52
I21.09STEMI involving other coronary artery of anterior wall49
I25.10Atherosclerotic heart disease of native coronary artery w/o angina pectoris48
I13.0Hypertensive heart & chronic kidney disease w heart failure and stage 1 through stage 4 chronic kidney disease, or unspecified chronic kidney disease46
I21.19ST elevation (STEMI) myocardial infarction involving other coronary artery of inferior wall43
Start Printed Page 19175

Top 10 Secondary Diagnosis MCC Conditions Reported With Procedure Code 5A1223

[Extracorporeal membrane oxygenation, continuous]

ICD-10-CM codeDescriptionNumber of times reportedAverage length of stayAverage costs
A41.9Sepsis, unspecified organism32229.7$186,055
E43Unspecified severe protein-calorie malnutrition22041.5213,742
G93.40Encephalopathy, unspecified21727.2165,193
J18.9Pneumonia, unspecified organism22023.5150,242
J96.01Acute respiratory failure with hypoxia94417.9122,614
J96.02Acute respiratory failure with hypercapnia22020.9139,511
K72.00Acute and subacute hepatic failure without coma52419140,878
N17.0Acute kidney failure with tubular necrosis74126.2162,583
R57.0Cardiogenic shock44827.7153,878
R65.21Severe sepsis with septic shock50429.7177,992

Top 10 Secondary Diagnosis CC Conditions Reported With Procedure Code 5A1223

[Extracorporeal membrane oxygenation, continuous]

ICD-10-CM codeDescriptionNumber of times reportedAverage length of stayAverage costs
D62Acute posthemorrhagic anemia1,13921.8$144,033
D68.9Coagulation defect, unspecified40220.5138,417
E87.0Hyperosmolality and hypernatremia58526.6162,028
E87.1Hypo-osmolality and hyponatremia31626.1151,824
E87.2Acidosis93717.3120,881
E87.4Mixed disorder of acid-base balance26826150,257
I13.0Hypertensive heart and chronic kidney disease with heart failure and stage 1 through stage 4 chronic kidney disease, or unspecified chronic kidney disease31418.4121,962
I47.2Ventricular tachycardia38417.5123,383
J98.11Atelectasis27326.9158,812
N17.9Acute kidney failure, unspecified75718.5122,180

These data show that the conditions reported for these patients requiring treatment with ECMO and reported with predecessor ICD-10-PCS procedure code 5A1223 represent a greater severity of illness, present greater treatment difficulty, have poorer prognoses, and have a greater need for intervention. While the data analysis was based on the conditions reported with the predecessor ICD-10-PCS procedure code 5A1223 (Extracorporeal membrane oxygenation, continuous), our clinical advisors believe the data may provide an indication of how cases reporting the new procedure codes describing peripheral (percutaneous) ECMO may be represented in future claims data with regard to indications for treatment, a patient's severity of illness, resource utilization, and treatment difficulty.

Based on the results of our data analysis and further review of the cases reporting ECMO, including consideration of the stakeholders' concerns that the MS-DRG assignments for ECMO procedures should not be based on the method of cannulation, our clinical advisors agree that resource consumption for both central and peripheral ECMO cases can be primarily attributed to the severity of illness of the patient, and that the method of cannulation is less relevant when considering the overall resources required to treat patients on ECMO. Specifically, our clinical advisors noted that consideration of resource consumption for cases reporting the use of ECMO may extend well beyond the duration of time that a patient was actively receiving ECMO treatment, which may range anywhere from less than 24 hours to 10 days or more. As noted above, in the absence of unique procedure codes that specify the duration of time that a patient was receiving ECMO treatment, we cannot ascertain from the claims data the resource use specifically attributable to treatment with ECMO during a hospital stay. However, when reviewing consumption of hospital resources for the cases in which ECMO was reported during a hospital stay, the claims data clearly show that the patients placed on ECMO typically have multiple MCC and CC conditions. These data provide additional information on the expanding indications for ECMO treatment as well as an indication of the complexities and the treatment difficulty associated with these patients. While our clinical advisors continue to believe that central (open) ECMO may be more resource intensive and carries significant risks for complications, including bleeding, infection, and vessel injury because it requires an incision along the sternum (sternotomy) and is performed for open heart surgery, they believe that the subset of patients who require treatment with ECMO, regardless of the cannulation method, would be similar in terms of overall hospital resource consumption. We also note that while we do not yet have Medicare claims data to evaluate the new peripheral ECMO procedure codes, review of limited registry data provided by stakeholders for patients treated with a reported peripheral ECMO procedure did not contradict that costs for peripheral ECMO appear to be similar to the costs of overall resources required to treat patients on ECMO (regardless of method of cannulation) and appear to be attributable to the severity of illness of the patient.

With regard to stakeholders who stated that the two new procedure codes do not account for an open cut-down approach that may be performed on a peripheral vessel during a peripheral ECMO procedure, we note that a request and proposal to create ICD-10-PCS codes to differentiate between peripheral vessel percutaneous and peripheral vessel open cutdown Start Printed Page 19176according to the indication (VA or VV) for ECMO was discussed at the March 5-6, 2019 ICD-10 Coordination and Maintenance Committee meeting. We refer readers to the website at: https://www.cms.gov/​Medicare/​Coding/​ICD9ProviderDiagnosticCodes/​ICD-9-CM-C-and-M-Meeting-Materials.html for the committee meeting materials and discussion regarding this proposal. We also note that, in this same proposal, another coding option to add duration values to allow the reporting of the number of hours or the number of days a patient received ECMO during the stay was also made available for public comment.

Upon further review and consideration of peripheral ECMO procedures, including the indications, treatment difficulty, and the resources utilized, for the reasons discussed above, our clinical advisors support the assignment of the new ICD-10-PCS procedure codes for peripheral ECMO procedures to the same MS-DRG as the predecessor code for open (central) ECMO procedures for FY 2020. Therefore, based on our review, including consideration of the comments and input from our clinical advisors, we are proposing to reassign the following procedure codes describing peripheral ECMO procedures from their current MS-DRG assignments to Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure) as shown in the table below. If this proposal is finalized, we also would make conforming changes to the titles for MS-DRGs 207, 291, 296, and 870 to no longer reflect the “or Peripheral Extracorporeal Membrane Oxygenation (ECMO)” terminology in the title. We note that this proposal includes maintaining the designation of these peripheral ECMO procedures as non-O.R. Therefore, if finalized, the procedures would be defined as non-O.R. affecting the MS-DRG assignment for Pre-MDC MS-DRG 003.

ICD-10-PCS codeCode descriptionCurrent MS-DRGProposed MS-DRG
5A1522GExtracorporeal Oxygenation, Membrane, Peripheral Veno-arterialMS-DRG 207 (Respiratory System Diagnosis with Ventilator Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 291 (Heart Failure and Shock with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 296 (Cardiac Arrest, Unexplained with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 870 (Septicemia or Severe Sepsis with Mechanical Ventilation >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
5A1522HExtracorporeal Oxygenation, Membrane, Peripheral Veno-venousMS-DRG 207 (Respiratory System Diagnosis with Ventilator Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 291 (Heart Failure and Shock with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 296 (Cardiac Arrest, Unexplained with MCC or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).
MS-DRG 870 (Septicemia or Severe Sepsis with Mechanical Ventilation >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))Pre-MDC MS-DRG 003 (ECMO or Tracheostomy with Mechanical Ventilation >96 Hours or Principal Diagnosis Except Face, Mouth and Neck with Major O.R. Procedure).

b. Allogeneic Bone Marrow Transplant

We received a request to create new MS-DRGs for cases that would identify patients who undergo an allogeneic hematopoietic cell transplant (HCT) procedure. The requestor asked us to split MS-DRG 014 (Allogeneic Bone Marrow Transplant) into two new MS-DRGs and assign cases to the recommended new MS-DRGs according to the donor source, with cases for allogeneic related matched donor source assigned to one MS-DRG and cases for allogeneic unrelated matched donor source assigned to the other MS-DRG. The requestor stated that by creating two new MS-DRGs for allogeneic related and allogeneic unrelated donor source, respectively, the MS-DRGs would more appropriately recognize the clinical characteristics and cost differences in allogeneic HCT cases.

The requestor stated that allogeneic related and allogeneic unrelated HCT cases are clinically different and have significantly different donor search and cell acquisition charges. According to the requestor, 70 percent of patients do not have a matched sibling donor (that is, an allogeneic related matched donor) in their family. The requestor also stated that this rate is higher for Medicare beneficiaries. According to the requestor, the current payment for allogeneic HCT cases is inadequate and affects patient's access to care.

The requestor performed its own analysis and stated that it found the average costs for HCT cases reporting revenue code 0815 (Stem cell acquisition) alone or revenue code 0819 (Other organ acquisition) in combination with revenue code 0815 with one of the ICD-10-PCS procedure Start Printed Page 19177codes for allogeneic unrelated donor source were significantly higher than the average costs for HCT cases reporting revenue code 0815 alone or both revenue codes 0815 and 0819 in combination with one of the ICD-10-PCS procedure codes for allogeneic related donor source. Further, the requestor reported that, according to its analysis, the average costs for HCT cases reporting revenue code 0815 alone or both revenue codes 0815 and 0819 in combination with one of the ICD-10-PCS procedure codes for unspecified allogeneic donor source were also significantly higher than the average costs for HCT cases reporting the ICD-10-PCS procedure codes for allogeneic related donor source. The requestor suggested that cases reporting the unspecified donor source procedure code are highly likely to represent unrelated donors, and recommended that, if the two new MS-DRGs are created as suggested, the cases reporting the procedure codes for unspecified donor source be included in the suggested new “unrelated donor” MS-DRG. The requestor also suggested that CMS apply a code edit through the inpatient Medicare Code Editor (MCE), similar to the edit in the Integrated Outpatient Code Editor (I/OCE) which requires reporting of revenue code 0815 on the claim with the appropriate procedure code or the claim may be subject to being returned to the provider.

The ICD-10-PCS procedure codes assigned to MS-DRG 014 that identify related, unrelated and unspecified donor source for an allogeneic HCT are shown in the following table.

ICD-10-PCS codeCode description
30230G2Transfusion of allogeneic related bone marrow into peripheral vein, open approach.
30230G3Transfusion of allogeneic unrelated bone marrow into peripheral vein, open approach.
30230G4Transfusion of allogeneic unspecified bone marrow into peripheral vein, open approach.
30230X2Transfusion of allogeneic related cord blood stem cells into peripheral vein, open approach.
30230X3Transfusion of allogeneic unrelated cord blood stem cells into peripheral vein, open approach.
30230X4Transfusion of allogeneic unspecified cord blood stem cells into peripheral vein, open approach.
30230Y2Transfusion of allogeneic related hematopoietic stem cells into peripheral vein, open approach.
30230Y3Transfusion of allogeneic unrelated hematopoietic stem cells into peripheral vein, open approach.
30230Y4Transfusion of allogeneic unspecified hematopoietic stem cells into peripheral vein, open approach.
30233G2Transfusion of allogeneic related bone marrow into peripheral vein, percutaneous approach.
30233G3Transfusion of allogeneic unrelated bone marrow into peripheral vein, percutaneous approach.
30233G4Transfusion of allogeneic unspecified bone marrow into peripheral vein, percutaneous approach.
30233X2Transfusion of allogeneic related cord blood stem cells into peripheral vein, percutaneous approach.
30233X3Transfusion of allogeneic unrelated cord blood stem cells into peripheral vein, percutaneous approach.
30233X4Transfusion of allogeneic unspecified cord blood stem cells into peripheral vein, percutaneous approach.
30233Y2Transfusion of allogeneic related hematopoietic stem cells into peripheral vein, percutaneous approach.
30233Y3Transfusion of allogeneic unrelated hematopoietic stem cells into peripheral vein, percutaneous approach.
30233Y4Transfusion of allogeneic unspecified hematopoietic stem cells into peripheral vein, percutaneous approach.
30240G2Transfusion of allogeneic related bone marrow into central vein, open approach.
30240G3Transfusion of allogeneic unrelated bone marrow into central vein, open approach.
30240G4Transfusion of allogeneic unspecified bone marrow into central vein, open approach.
30240X2Transfusion of allogeneic related cord blood stem cells into central vein, open approach.
30240X3Transfusion of allogeneic unrelated cord blood stem cells into central vein, open approach.
30240X4Transfusion of allogeneic unspecified cord blood stem cells into central vein, open approach.
30240Y2Transfusion of allogeneic related hematopoietic stem cells into central vein, open approach.
30240Y3Transfusion of allogeneic unrelated hematopoietic stem cells into central vein, open approach.
30240Y4Transfusion of allogeneic unspecified hematopoietic stem cells into central vein, open approach.
30243G2Transfusion of allogeneic related bone marrow into central vein, percutaneous approach.
30243G3Transfusion of allogeneic unrelated bone marrow into central vein, percutaneous approach.
30243G4Transfusion of allogeneic unspecified bone marrow into central vein, percutaneous approach.
30243X2Transfusion of allogeneic related cord blood stem cells into central vein, percutaneous approach.
30243X3Transfusion of allogeneic unrelated cord blood stem cells into central vein, percutaneous approach.
30243X4Transfusion of allogeneic unspecified cord blood stem cells into central vein, percutaneous approach.
30243Y2Transfusion of allogeneic related hematopoietic stem cells into central vein, percutaneous approach.
30243Y3Transfusion of allogeneic unrelated hematopoietic stem cells into central vein, percutaneous approach.
30243Y4Transfusion of allogeneic unspecified hematopoietic stem cells into central vein, percutaneous approach.
30250G1Transfusion of nonautologous bone marrow into peripheral artery, open approach.
30250X1Transfusion of nonautologous cord blood stem cells into peripheral artery, open approach.
30250Y1Transfusion of nonautologous hematopoietic stem cells into peripheral artery, open approach.
30253G1Transfusion of nonautologous bone marrow into peripheral artery, percutaneous approach.
30253X1Transfusion of nonautologous cord blood stem cells into peripheral artery, percutaneous approach.
30253Y1Transfusion of nonautologous hematopoietic stem cells into peripheral artery, percutaneous approach.
30260G1Transfusion of nonautologous bone marrow into central artery, open approach.
30260X1Transfusion of nonautologous cord blood stem cells into central artery, open approach.
30260Y1Transfusion of nonautologous hematopoietic stem cells into central artery, open approach.
30263G1Transfusion of nonautologous bone marrow into central artery, percutaneous approach.
30263X1Transfusion of nonautologous cord blood stem cells into central artery, percutaneous approach.
30263Y1Transfusion of nonautologous hematopoietic stem cells into central artery, percutaneous approach.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRG 014 and identified the subset of cases within MS-DRG 014 reporting procedure codes for allogeneic HCT related donor source, allogeneic HCT unrelated donor source, and allogeneic HCT unspecified donor source, respectively. Our findings are shown in the following table.Start Printed Page 19178

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 014—All cases85428.2$91,446
MS-DRG 014—Cases reporting allogeneic HCT related donor source29229.587,444
MS-DRG 014—Cases reporting allogeneic HCT unrelated donor source46627.995,146
MS-DRG 014—Cases reporting allogeneic HCT unspecified donor source9026.290,945

The total number of cases reported in MS-DRG 014 was 854, with an average length of stay of 28.2 days and average costs of $91,446. For the subset of cases reporting procedure codes for allogeneic HCT related donor source, there were a total of 292 cases with an average length of stay of 29.5 days and average costs of $87,444. For the subset of cases reporting procedure codes for allogeneic HCT unrelated donor source, there was a total of 466 cases with an average length of stay of 27.9 days and average costs of $95,146. For the subset of cases reporting procedure codes for allogeneic HCT unspecified donor source, there was a total of 90 cases with an average length of stay of 26.2 days and average costs of $90,945.

Based on the analysis described above, the current MS-DRG assignment for the cases in MS-DRG 014 that identify patients who undergo an allogeneic HCT procedure, regardless of donor source, appears appropriate. The data analysis reflects that each subset of cases reporting a procedure code for an allogeneic HCT procedure (that is, related, unrelated, or unspecified donor source) has an average length of stay and average costs that are comparable to the average length of stay and average costs of all cases in MS-DRG 014. We also take this opportunity to note that, in deciding whether to propose to make further modifications to the MS-DRGs for particular circumstances brought to our attention, we do not consider the reported revenue codes. Rather, as stated previously, we consider whether the resource consumption and clinical characteristics of the patients with a given set of conditions are significantly different than the remaining patients represented in the MS-DRG. We do this by evaluating the ICD-10-CM diagnosis and/or ICD-10-PCS procedure codes that identify the patient conditions, procedures, and the relevant MS-DRG(s) that are the subject of a request. Specifically, for this request, as noted above, we analyzed the cases reporting the ICD-10-PCS procedure codes that identify an allogeneic HCT procedure according to the donor source. We then evaluated patient care costs using average costs and average lengths of stay (based on the MedPAR data) and rely on the judgment of our clinical advisors to determine whether the patients are clinically distinct or similar to other patients represented in the MS-DRG. Because MS-DRG 014 is defined by patients who undergo an allogeneic HCT transplant procedure, our clinical advisors state they are all clinically similar in that regard. We also note that the ICD-10-PCS procedure codes that describe an allogeneic HCT procedure were revised effective October 1, 2016 to uniquely identify the donor source in response to a request and proposal that was discussed at the March 9-10, 2016 ICD-10 Coordination and Maintenance Committee meeting. We refer readers to the website at: https://www.cms.gov/​Medicare/​Coding/​ICD9Provider DiagnosticCodes/ICD-9-CM-C-and-M-Meeting-Materials.html for the committee meeting materials and discussion regarding this proposal.

In response to the requestor's statement that allogeneic related and allogeneic unrelated HCT cases are clinically different and have significantly different donor search and cell acquisition charges, our clinical advisors support maintaining the current structure for MS-DRG 014 because they believe that MS-DRG 014 appropriately classifies all patients who undergo an allogeneic HCT procedures and, therefore, it is clinically coherent. While the requestor stated that there are clinical differences in the related and unrelated HCT cases, they did not provide any specific examples of these clinical differences. With regard to the donor search and cell acquisition charges, the requestor noted that the unrelated donor cases are more expensive than the related donor cases because of the donor search process, which includes a registry search to identify the best donor source, extensive donor screenings, evaluation, and cell acquisition and transportation services for the patient. The requestor appeared to base that belief according to the donor source and average charges reported with revenue code 0815. As noted above, we use MedPAR data and do not consider the reported revenue codes in deciding whether to propose to make further modifications to the MS-DRGs. Based on our analysis of claims data for MS-DRG 014, our clinical advisors stated that the resources are similar for patients who undergo an allogeneic HCT procedure regardless of the donor source.

In reviewing this request, we also reviewed the instructions on billing for stem cell transplantation in Chapter 3 of the Medicare Claims Processing Manual and found that there appears to be inadvertent duplication under Section 90.3.1 and Section 90.3.3 of Chapter 3, as both sections provide instructions on Billing for Stem Cell Transplantation. Therefore, we are further reviewing the Medicare Claims Processing Manual to identify potential revisions to address this duplication. However, we also note that section 90.3.1 and section 90.3.3 provide different instruction regarding which revenue code should be reported. Section 90.3.1 instructs providers to report revenue code 0815 and Section 90.3.3 instructs providers to report revenue code 0819. We note that we issued instructions as a One-Time Notification, Pub. No. 100-04, Transmittal 3571, Change Request 9674, effective January 1, 2017, which instructs that the appropriate revenue code to report on claims for allogeneic stem cell acquisition/donor services is revenue code 0815. Accordingly, we also are considering additional revisions as needed to conform the instructions for reporting these codes in the Medicare Claims Processing Manual.

With regard to the requestor's recommendation that we create a new code edit through the inpatient MCE similar to the edit in the I/OCE which requires reporting of revenue code 0815 on the claim, we note that the MCE is not designed to include revenue codes for claims editing purposes. Rather, as stated in section II.F.16. of the preamble of this proposed rule, it is a software program that detects and reports errors in the coding of Medicare claims data. The coding of Medicare claims data refers to diagnosis and procedure coding, as well as demographic information.

For the reasons described above, we are not proposing to change the current structure of MS-DRG 014. We are not proposing to split MS-DRG 014 into two new MS-DRGs that assign cases according to whether the allogeneic donor source is related or unrelated, as the requestor suggested.

In addition, while conducting our analysis of cases reporting ICD-10-PCS Start Printed Page 19179procedure codes for allogeneic HCT procedures that are assigned to MS-DRG 014, we noted that 8 procedure codes for autologous HCT procedures are currently included in MS-DRG 014, as shown in the following table. These codes are not properly assigned because MS-DRG 014 is defined by cases reporting allogenic HCT procedures.

ICD-10-PCS codeCode description
30230X0Transfusion of autologous cord blood stem cells into peripheral vein, open approach.
30233X0Transfusion of autologous cord blood stem cells into peripheral vein, percutaneous approach.
30240X0Transfusion of autologous cord blood stem cells into central vein, open approach.
30243X0Transfusion of autologous cord blood stem cells into central vein, percutaneous approach.
30250X0Transfusion of autologous cord blood stem cells into peripheral artery, open approach.
30253X0Transfusion of autologous cord blood stem cells into peripheral artery, percutaneous approach.
30260X0Transfusion of autologous cord blood stem cells into central artery, open approach.
30263X0Transfusion of autologous cord blood stem cells into central artery, percutaneous approach.

The 8 ICD-10-PCS procedure codes for autologous HCT procedures were inadvertently included in MS-DRG 014 as a result of efforts to replicate the ICD-9-CM MS-DRGs. Under the ICD-9-CM MS-DRGs, procedure code 41.06 (Cord blood stem cell transplant) was used to identify these procedures and was also assigned to MS-DRG 014. As shown in the ICD-9-CM code description, the reference to “autologous” is not included. However, because the ICD-10-PCS autologous HCT procedure codes were considered as plausible translations of the ICD-9-CM procedure code (41.06), they were inadvertently included in MS-DRG 014. We also note that, of these 8 procedure codes, there are 4 procedure codes that describe a transfusion via arterial access. As described in more detail below, because a transfusion procedure always uses venous access rather than arterial access, these codes are considered clinically invalid and were the subject of a proposal discussed at the March 5-6, 2019 ICD-10 Coordination and Maintenance Committee meeting to delete these codes effective October 1, 2019 (FY 2020).

The majority of ICD-10-PCS procedure codes specifying autologous HCT procedures are currently assigned to MS-DRGs 016 and 017 (Autologous Bone Marrow Transplant with CC/MCC or T-cell Immunotherapy and Autologous Bone Marrow Transplant without CC/MCC, respectively). These codes are listed in the following table.

ICD-10-PCS codeCode description
30230AZTransfusion of embryonic stem cells into peripheral vein, open approach.
30230G0Transfusion of autologous bone marrow into peripheral vein, open approach.
30230Y0Transfusion of autologous hematopoietic stem cells into peripheral vein, open approach.
30233AZTransfusion of embryonic stem cells into peripheral vein, percutaneous approach.
30233G0Transfusion of autologous bone marrow into peripheral vein, percutaneous approach.
30233Y0Transfusion of autologous hematopoietic stem cells into peripheral vein, percutaneous approach.
30240AZTransfusion of embryonic stem cells into central vein, open approach.
30240G0Transfusion of autologous bone marrow into central vein, open approach.
30240Y0Transfusion of autologous hematopoietic stem cells into central vein, open approach.
30243AZTransfusion of embryonic stem cells into central vein, percutaneous approach.
30243G0Transfusion of autologous bone marrow into central vein, percutaneous approach.
30243Y0Transfusion of autologous hematopoietic stem cells into central vein, percutaneous approach.
30250G0Transfusion of autologous bone marrow into peripheral artery, open approach.
30250Y0Transfusion of autologous hematopoietic stem cells into peripheral artery, open approach.
30253G0Transfusion of autologous bone marrow into peripheral artery, percutaneous approach.
30253Y0Transfusion of autologous hematopoietic stem cells into peripheral artery, percutaneous approach.
30260G0Transfusion of autologous bone marrow into central artery, open approach.
30260Y0Transfusion of autologous hematopoietic stem cells into central artery, open approach.
30263G0Transfusion of autologous bone marrow into central artery, percutaneous approach.
30263Y0Transfusion of autologous hematopoietic stem cells into central artery, percutaneous approach.

While we believe, as indicated, that the cases reporting ICD-10-PCS procedure codes for autologous HCT procedures may be improperly assigned to MS-DRG 014, we also examined claims data for this subset of cases to determine the frequency with which they were reported and the relative resource use as compared with all cases assigned to MS-DRGs 016 and 017. Our findings are shown in the following table.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 014—Cases reporting autologous cord blood stem cell donor source623.5$38,319
MS-DRG 016—All cases2,1501847,546
MS-DRG 017—All cases1041133,540

For the subset of cases in MS-DRG 014 reporting ICD-10-PCS codes for autologous HCT procedures, there was a total of 6 cases with an average length of stay of 23.5 days and average costs of $38,319. The total number of cases reported in MS-DRG 016 was 2,150, with an average length of stay of 18 days and average costs of $47,546. The total number of cases reported in MS-DRG 017 was 104, with an average length of Start Printed Page 19180stay of 11 days and average costs of $33,540.

The results of our analysis indicate that the frequency with which these autologous HCT procedure codes was reported in MS-DRG 014 is low and that average costs of cases reporting autologous HCT procedures assigned to MS-DRG 014 are more aligned with the average costs of cases assigned to MS-DRGs 016 and 017, with the average costs being lower than the average costs for all cases assigned to MS-DRG 016 and higher than the average costs for all cases assigned to MS-DRG 017. Our clinical advisors also indicated that the procedure codes for autologous HCT procedures are more clinically aligned with cases that are assigned to MS-DRGs 016 and 017 that are comprised of autologous HCT procedures. Therefore, we are proposing to reassign the following 4 procedure codes for HCT procedures specifying autologous cord blood stem cell as the donor source via venous access to MS-DRGs 016 and 017 for FY 2020.

ICD-10-PCS codeCode description
30230X0Transfusion of autologous cord blood stem cells into peripheral vein, open approach.
30233X0Transfusion of autologous cord blood stem cells into peripheral vein, percutaneous approach.
30240X0Transfusion of autologous cord blood stem cells into central vein, open approach.
30243X0Transfusion of autologous cord blood stem cells into central vein, percutaneous approach.

As discussed earlier in this section, the 4 procedure codes for HCT procedures that describe an autologous cord blood stem cell transfusion via arterial access currently assigned to MS-DRG 014, as listed previously, are considered clinically invalid. These procedure codes were discussed at the March 5-6, 2019 ICD-10 Coordination and Maintenance Committee meeting, along with additional procedure codes that are also considered clinically invalid, as described in the section below.

During our analysis of procedure codes that describe a HCT procedure, we identified 128 clinically invalid codes from the transfusion table (table 302) in the ICD-10-PCS classification identifying a transfusion using arterial access, as listed in Table 6P.1a. associated with this proposed rule (which is available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html). As shown in Table 6P.1a., these 128 procedure codes describe transfusion procedures with body system/region values “5” Peripheral Artery and “6” Central Artery. Because a transfusion procedure always uses venous access rather than arterial access, these codes are considered clinically invalid and were proposed for deletion at the March 5-6, 2019 ICD-10 Coordination and Maintenance Committee meeting. We refer the reader to the website at: https://www.cms.gov/​Medicare/​Coding/​ICD10/​C-and-M-Meeting-Materials.html for the Committee meeting materials regarding this proposal.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 014, 016, and 017 to determine if there were any cases that reported one of the 128 clinically invalid codes from the transfusion table in the ICD-10-PCS classification identifying a transfusion using arterial access, and as listed in Table 6P.1a. associated with this proposed rule. Our clinical advisors agree that because a transfusion procedure always uses venous access rather than arterial access, these codes are considered invalid. Because these procedure codes describe clinically invalid procedures, we would not expect these codes to be reported in any claims data. Our findings are shown in the following table.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRGs 014, 016, and 017—All cases3,10820.4$59,140
MS-DRGs 014, 016, and 017—Cases with invalid transfusion codes3119.652,912

As shown in this table, we found a total of 3,108 cases across MS-DRGs 014, 016, and 017 with an average length of stay of 20.4 days and average costs of $59,140. We found a total of 31 cases (0.9 percent) reporting a procedure code for an invalid transfusion procedure, identifying the body system/region value “5” Peripheral Artery or “6” Central Artery, with an average length of stay of 19.6 days and average costs of $52,912. The results of the data analysis demonstrate that these invalid transfusion procedures represent approximately 1 percent of all discharges across MS-DRGs 014, 016, and 017. To summarize, we are proposing to: (1) Reassign the four ICD-10-PCS codes for HCT procedures specifying autologous cord blood stem cell as the donor source from MS-DRG 014 to MS-DRGs 016 and 017 (procedure codes 30230X0, 30233X0, 30240X0, 30243X0); and (2) delete the 128 clinically invalid codes from the transfusion table in the ICD-10-PCS Classification describing a transfusion using arterial access that were discussed at the March 5-6, 2019 ICD-10 Coordination and Maintenance Committee meeting and are listed in Table 6P.1a associated with this proposed rule. As discussed previously, we are not proposing to split MS-DRG 014 into the two requested new MS DRGs that would assign cases according to whether the allogeneic donor source is related or unrelated.

c. Chimeric Antigen Receptor (CAR) T-Cell Therapies

We received a request to create a new MS-DRG for procedures involving CAR T-cell therapies. The requestor stated that creation of a new MS-DRG would improve payment for CAR T-cell therapies in the inpatient setting. According to the requestor, while cases involving CAR T-cell therapy may now be eligible for new technology add-on payments and outlier payments, there continue to be significant financial losses by providers. The requestor also suggested that CMS modify its existing payment mechanisms to use a CCR of 1.0 for charges associated with CAR T-cell therapy.

In addition, the requestor included technical and operational suggestions related to CAR T-cell therapy, such as Start Printed Page 19181the development of unique CAR T-cell therapy revenue and cost centers for billing and cost reporting purposes. We will consider these technical and operational suggestions in the development of future billing and cost reporting guidelines and instructions.

Currently, procedures involving CAR T-cell therapies are identified with ICD-10-PCS procedure codes XW033C3 (Introduction of engineered autologous chimeric antigen receptor t-cell immunotherapy into peripheral vein, percutaneous approach, new technology group 3) and XW043C3 (Introduction of engineered autologous chimeric antigen receptor t-cell immunotherapy into central vein, percutaneous approach, new technology group 3), which became effective October 1, 2017. In the FY 2019 IPPS/LTCH PPS final rule, we finalized our proposal to assign cases reporting these ICD-10-PCS procedure codes to Pre-MDC MS-DRG 016 for FY 2019 and to revise the title of this MS-DRG to “Autologous Bone Marrow Transplant with CC/MCC or T-cell Immunotherapy”. We refer readers to section II.F.2.d. of the preamble of the FY 2019 IPPS/LTCH PPS final rule for a complete discussion of these final policies (83 FR 41172 through 41174).

As stated earlier, the current procedure codes for CAR T-cell therapies both became effective October 1, 2017. In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41172 through 41174), we indicated we should collect more comprehensive clinical and cost data before considering assignment of a new MS-DRG to these therapies. While the September 2018 update of the FY 2018 MedPAR data file does contain some claims that include those procedure codes that identify CAR T-cell therapies, the number of cases is limited, and the submitted costs vary widely due to differences in provider billing and charging practices for this therapy. Therefore, while these claims could potentially be used to create relative weights for a new MS-DRG, we do not have the comprehensive clinical and cost data that we generally believe are needed to do so. Furthermore, given the relative newness of CAR T-cell therapy and our proposal to continue new technology add-on payments for FY 2020 for the two CAR T-cell therapies that currently have FDA approval (KYMRIAHTM and YESCARTATM), as discussed in section II.G.4.d. of the preamble of this proposed rule, at this time we believe it may be premature to consider creation of a new MS-DRG specifically for cases involving CAR T-cell therapy for FY 2020.

Therefore, we are proposing not to modify the current MS-DRG assignment for cases reporting CAR T-cell therapies for FY 2020. As noted earlier, cases reporting ICD-10-PCS codes XW033C3 and XW043C3 would continue to be eligible to receive new technology add-on payments for discharges occurring in FY 2020 if our proposal to continue such payments is finalized. Currently, we expect that, in future years, we would have additional data that exhibit more stability and greater consistency in charging and billing practices that could be used to evaluate the potential creation of a new MS-DRG specifically for cases involving CAR T-cell therapies.

Alternatively, notwithstanding our concerns regarding the claims data, and the concerns discussed in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41172 to 41174), we are seeking public comments on payment alternatives for CAR T-cell therapies, including payment under any potential new MS-DRG. We also are inviting public comments on how these payment alternatives would affect access to care, as well as how they affect incentives to encourage lower drug prices, which is a high priority for this Administration. As discussed in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41172 through 41174), we are considering approaches and authorities to encourage value-based care and lower drug prices. We are soliciting public comments on how the effective dates of any potential payment methodology alternatives, if any were to be adopted, may intersect and affect future participation in any such alternative approaches.

As part of our solicitation of public comment on the potential creation of a new MS-DRG for CAR T-cell therapy procedures, we are also seeking comment on the most appropriate way to develop the relative weight if we were to finalize the creation of a new MS-DRG. While the data are limited, it may be operationally possible to create a relative weight by dividing the average costs of cases that include the CAR T-cell procedures by the average costs of all cases, consistent with our current methodology for setting the relative weights for FY 2020 and using the same applicable data sources used for other MS-DRGs (for FY 2020, the FY 2018 MedPAR data and FY 2016 HCRIS data). We are seeking public comments on whether this is the most accurate method for determining the relative weight, given the current variation in the claims data for these procedures, and also on how to address the significant number of cases involving clinical trials. While we do not typically exclude cases in clinical trials when developing the relative weights, in this case, the absence of the drug costs on claims for cases involving clinical trial claims could have a significant impact on the relative weight. It is unclear whether a relative weight calculated using cases for which hospitals do and do not incur drug costs would accurately reflect the resource costs of caring for patients who are not involved in clinical trials. A different approach might be to develop a relative weight using an appropriate portion of the average sales price (ASP) for these drugs as an alternative way to reflect the costs involved in treating patients receiving CAR T-cell therapies. We are requesting public comments on these approaches or other approaches for setting the relative weight if we were to finalize a new MS-DRG. We note that any such new MS-DRG would be established in a budget neutral manner, consistent with section 1886(d)(4)(C)(iii) of the Act, which specifies that the annual DRG reclassification and recalibration of the relative weights must be made in a manner that ensures that aggregate payments to hospitals are not affected.

Another potential consideration if we were to create a new MS-DRG is the extent to which it would be appropriate to geographically adjust the payment under any such new MS-DRG. Under the methodology for determining the Federal payment rate for operating costs under the IPPS, the labor-related proportion of the national standardized amounts is adjusted by the wage index to reflect the relative differences in labor costs among geographic areas. The IPPS Federal payment rate for operating costs is calculated as the MS-DRG relative weight × [(labor-related applicable standardized amount × applicable wage index) + (nonlabor-related applicable standardized amount × cost-of-living adjustment)]. Given our understanding that the costs for CAR T-cell therapy drugs do not vary among geographic areas, and given that costs for CAR T-cell therapy would likely be an extremely high portion of the costs for the MS-DRG, we are seeking public comments on whether we should not geographically adjust the payment for cases assigned to any potential new MS-DRG for CAR T-cell therapy procedures. We also are seeking public comments on whether to instead apply the geographic adjustment to a lower proportion of payments under any potential new MS-DRG and, if so, how that lower proportion should be determined. We note that while the prices of other drugs may also not vary significantly among geographic areas, generally speaking, those other drugs would not have estimated costs as high Start Printed Page 19182as those of CAR T-cell therapies, nor would they represent as significant a percentage of the average costs for the case. We are seeking public comments on the use of our exceptions and adjustments authority under section 1886(d)(5)(I) of the Act (or other relevant authorities) to implement any such potential changes.

Section 1886(d)(5)(B) of the Act provides that prospective payment hospitals that have residents in an approved graduate medical education (GME) program receive an additional payment for a Medicare discharge to reflect the higher patient care costs of teaching hospitals relative to nonteaching hospitals. The regulations regarding the calculation of this additional payment, known as the indirect medical education (IME) adjustment, are located at 42 CFR 412.105. The formula is traditionally described in terms of a certain percentage increase in payment for every 10-percent increase in the resident-to-bed ratio. For some hospitals, this percentage increase can exceed an additional 25 percent or more of the otherwise applicable payment. Some hospitals, sometimes the same hospitals, can also receive a large percentage increase in payments due to the Medicare disproportionate hospital (DSH) adjustment provision under section 1886(d)(5)(F) of the Act. The regulations regarding the calculation of the additional DSH payment are located at 42 CFR 412.106.

Given that the payment for cases assigned to a new MS-DRG for CAR T-cell therapy could significantly exceed the historical payment for any existing MS-DRG, these percentage add-on payments could arguably result in unreasonably high additional payments for CAR T-cell therapy cases unrelated in any significant empirical way to the costs of the hospital in providing care. For example, consider a teaching hospital that has an IME adjustment factor of 0.25, and a DSH adjustment factor of 0.10. If we were to create a new MS-DRG for CAR T-cell therapy procedures that resulted in an average IPPS Federal payment rate for operating costs of $400,000, under the current payment mechanism, the hospital would receive an IME payment of $100,000 ($400,000 × 0.25) and a DSH payment of $40,000 ($400,000 × 0.10), such that the total IPPS Federal payment rate for operating costs including IME and DSH payments would be $540,000 ($400,000 + $100,000 + $40,000). We are seeking public comments on whether the IME and DSH payments should not be made for cases assigned to any new MS-DRG for CAR T-cell therapy. We also are seeking public comments on whether we should instead reduce the applicable percentages used to determine these add-ons and, if so, how those lower percentages should be determined. We are seeking public comments on the use of our exceptions and adjustments authority under section 1886(d)(5)(I) of the Act (or other relevant authorities) to implement any potential changes.

As further discussed section II.G.7. of the preamble to this proposed rule, we are also requesting public comment on other payment alternatives for these cases, including eliminating the use of the CCR in calculating the new technology add-on payment for KYMRIAH® and YESCARTA® by making a uniform add-on payment that equals the proposed maximum add-on payment, that is, 65 percent of the cost of the technology (in accordance with the proposed increase in the calculation of the maximum new technology add-on payment amount), which in this instance would be $242,450; and/or using a higher percentage than the proposed 65 percent to calculate the maximum new technology add-on payment amount.

We are also requesting public comments on whether, in light of the additional experience with billing and payment for cases involving CAR T-cell therapies to Medicare patients, we should consider utilizing a specific CCR for ICD-10-PCS procedure codes used to report the performance of procedures involving the use of CAR T-cell therapies; for example, a CCR of 1.0, when determining outlier payments, when determining the new technology add-on payments, and when determining payments to IPPS-excluded cancer hospitals for CAR T-cell therapies.

We note that we also considered this payment alternative for FY 2019, as discussed in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41172 through 41174). We indicated in that rulemaking that such a payment alternative might use a CCR of 1.0 for charges associated with ICD-10-PCS procedure codes XW033C3 and XW043C3, given that many public inquirers believed that hospitals would be unlikely to set charges different from the costs for KYMRIAH® and YESCARTA® CAR T-cell therapies. We also indicated such a change would result in a higher outlier payment, higher new technology add-on payment, or the determination of higher costs for IPPS-excluded cancer hospital cases. For example, and as described in the FY 2019 IPPS LTCH PPS final rule (83 FR 41773), if a hospital charged $400,000 for the procedure described by ICD-10-PCS procedure code XW033C3, the application of a hypothetical CCR of 0.25 results in a cost of $100,000 (= $400,000 * 0.25) while the application of a hypothetical CCR of 1.00 results in a cost of $400,000 (= $400,000 * 1.0).

3. MDC 1 (Diseases and Disorders of the Nervous System): Carotid Artery Stent Procedures

The logic for case assignment to MS-DRGs 034, 035, and 036 (Carotid Artery Stent Procedures with MCC, with CC, and without CC/MCC, respectively) as displayed in the ICD-10 MS-DRG Version 36 Definitions Manual (which is available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​MS-DRG-Classifications-and-Software.html) is comprised of two lists of logic that include procedure codes for operating room (O.R.) procedures involving dilation of a carotid artery (common, internal or external) with intraluminal device(s). The first list of logic is entitled “Operating Room Procedures” and the second list of logic is entitled “Operating Room Procedures with Operating Room Procedures”. We identified 46 ICD-10-PCS procedure codes in the second logic list that do not describe dilation of a carotid artery with an intraluminal device. Of these 46 procedure codes, we identified 24 codes describing dilation of a carotid artery without an intraluminal device; 8 codes describing dilation of the vertebral artery; and 14 codes describing dilation of a vein (jugular, vertebral and face), as shown in the following table.

ICD-10 PCS Codes That Involve Dilation of a Neck Artery or Vein With and Without an Intraluminal Device

ICD-10-PCS codeCode description
037H3Z6Dilation of right common carotid artery, bifurcation, percutaneous approach.
037H3ZZDilation of right common carotid artery, percutaneous approach.
Start Printed Page 19183
037H4Z6Dilation of right common carotid artery, bifurcation, percutaneous endoscopic approach.
037H4ZZDilation of right common carotid artery, percutaneous endoscopic approach.
037J3Z6Dilation of left common carotid artery, bifurcation, percutaneous approach.
037J3ZZDilation of left common carotid artery, percutaneous approach.
037J4Z6Dilation of left common carotid artery, bifurcation, percutaneous endoscopic approach.
037J4ZZDilation of left common carotid artery, percutaneous endoscopic approach.
037K3Z6Dilation of right internal carotid artery, bifurcation, percutaneous approach.
037K3ZZDilation of right internal carotid artery, percutaneous approach.
037K4Z6Dilation of right internal carotid artery, bifurcation, percutaneous endoscopic approach.
037K4ZZDilation of right internal carotid artery, percutaneous endoscopic approach.
037L3Z6Dilation of left internal carotid artery, bifurcation, percutaneous approach.
037L3ZZDilation of left internal carotid artery, percutaneous approach.
037L4Z6Dilation of left internal carotid artery, bifurcation, percutaneous endoscopic approach.
037L4ZZDilation of left internal carotid artery, percutaneous endoscopic approach.
037M3Z6Dilation of right external carotid artery, bifurcation, percutaneous approach.
037M3ZZDilation of right external carotid artery, percutaneous approach.
037M4Z6Dilation of right external carotid artery, bifurcation, percutaneous endoscopic approach.
037M4ZZDilation of right external carotid artery, percutaneous endoscopic approach.
037N3Z6Dilation of left external carotid artery, bifurcation, percutaneous approach.
037N3ZZDilation of left external carotid artery, percutaneous approach.
037N4Z6Dilation of left external carotid artery, bifurcation, percutaneous endoscopic approach.
037N4ZZDilation of left external carotid artery, percutaneous endoscopic approach.
037P3Z6Dilation of right vertebral artery, bifurcation, percutaneous approach.
037P3ZZDilation of right vertebral artery, percutaneous approach.
037P4Z6Dilation of right vertebral artery, bifurcation, percutaneous endoscopic approach.
037P4ZZDilation of right vertebral artery, percutaneous endoscopic approach.
037Q3Z6Dilation of left vertebral artery, bifurcation, percutaneous approach.
037Q3ZZDilation of left vertebral artery, percutaneous approach.
037Q4Z6Dilation of left vertebral artery, bifurcation, percutaneous endoscopic approach.
037Q4ZZDilation of left vertebral artery, percutaneous endoscopic approach.
057M3DZDilation of right internal jugular vein with intraluminal device, percutaneous approach.
057M4DZDilation of right internal jugular vein with intraluminal device, percutaneous endoscopic approach.
057N3DZDilation of left internal jugular vein with intraluminal device, percutaneous approach.
057N4DZDilation of left internal jugular vein with intraluminal device, percutaneous endoscopic approach.
057P3DZDilation of right external jugular vein with intraluminal device, percutaneous approach.
057P4DZDilation of right external jugular vein with intraluminal device, percutaneous endoscopic approach.
057Q3DZDilation of left external jugular vein with intraluminal device, percutaneous approach.
057Q4DZDilation of left external jugular vein with intraluminal device, percutaneous endoscopic approach.
057R3DZDilation of left vertebral vein with intraluminal device, percutaneous approach.
057R4DZDilation of right vertebral vein with intraluminal device, percutaneous endoscopic approach.
057S3DZDilation of left vertebral vein with intraluminal device, percutaneous approach.
057S4DZDilation of left vertebral vein with intraluminal device, percutaneous endoscopic approach.
057T3DZDilation of right face vein with intraluminal device, percutaneous approach.
057T4DZDilation of right face vein with intraluminal device, percutaneous endoscopic approach.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 034, 035, and 036 and identified cases reporting any one of the 46 ICD-10-PCS procedure codes listed in the tables above. Our findings are shown in the following table.

MS-DRGs for Carotid Artery Stent Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 034—All cases8636.8$27,600
MS-DRG 034—Cases with procedure code other than dilation of a carotid artery with an intraluminal device158.836,596
MS-DRG 035—All cases2,369316,731
MS-DRG 035—Cases with procedure code other than dilation of a carotid artery with an intraluminal device523.517,815
MS-DRG 036—All cases3,4811.412,637
MS-DRG 036—Cases with procedure code other than dilation of a carotid artery with an intraluminal device671.412,621

As shown in the table above, we found a total of 863 cases with an average length of stay of 6.8 days and average costs of $27,600 in MS-DRG 034. There were 15 cases reporting at least one of the 46 procedure codes that Start Printed Page 19184do not describe dilation of the carotid artery with an intraluminal device in MS-DRG 034 with an average length of stay of 8.8 days and average costs of $36,596. For MS-DRG 035, we found a total of 2,369 cases with an average length of stay of 3 days and average costs of $16,731. There were 52 cases reporting at least one of the 46 procedure codes that do not describe dilation of the carotid artery with an intraluminal device in MS-DRG 035 with an average length of stay of 3.5 days and average costs of $17,815. For MS-DRG 036, we found a total of 3,481 cases with an average length of stay of 1.4 days and average costs of $12,637. There were 67 cases reporting at least one of the 46 procedure codes that do not describe dilation of the carotid artery with an intraluminal device in MS-DRG 036 with an average length of stay of 1.4 days and average costs of $12,621.

Our clinical advisors stated that MS-DRGs 034, 035, and 036 are defined to include only those procedure codes that describe procedures that involve dilation of a carotid artery with an intraluminal device. Therefore, we are proposing to remove the procedure codes listed in the table above from MS-DRGs 034, 035, and 036 that describe procedures which (1) do not include an intraluminal device; (2) describe procedures performed on arteries other than a carotid; and (3) describe procedures performed on a vein.

The 46 ICD-10-PCS procedure codes listed in the table above are also assigned to MS-DRGs 037, 038, and 039 (Extracranial Procedures with MCC, with CC, and without CC/MCC, respectively). Therefore, we also examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 037, 038, and 039. Our findings are shown in the following table.

MS-DRGs for Extracranial Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 037—All cases3,6127.1$23,703
MS-DRG 038—All cases11,4063.112,480
MS-DRG 039—All cases22,9381.58,400

We found a total of 3,612 cases in MS-DRG 037 with an average length of stay of 7.1 days and average costs of $23,703. We found a total of 11,406 cases in MS-DRG 038 with an average length of stay of 3.1 days and average costs of $12,480. We found a total of 22,938 cases in MS-DRG 039 with an average length of stay of 1.5 days and average costs of $8,400.

During our review of claims data for MS-DRGs 037, 038, and 039, we also discovered 96 ICD-10-PCS procedure codes describing dilation of a carotid artery with an intraluminal device that were inadvertently included as a result of efforts to replicate the ICD-9 based MS-DRGs. These procedure codes are also included in the logic for MS-DRGs 034, 035, and 036. Under ICD-9-CM, procedure codes 00.61 (Percutaneous angioplasty of extracranial vessel(s)) and 00.63 (Percutaneous insertion of carotid artery stent(s)) are both required to be reported on a claim to identify that a carotid artery stent procedure was performed and for assignment of the case to MS-DRGs 034, 035, and 036. Procedure code 00.61 is designated as an O.R. procedure, while procedure code 00.63 is designated as a non-O.R. procedure. Under ICD-10-PCS, a carotid artery stent procedure is described by one unique code that includes both clinical concepts of the angioplasty (dilation) and the insertion of the stent (intraluminal device). This “combination code” under ICD-10-PCS is designated as an O.R. procedure. Under ICD-9-CM, procedure code 00.61 reported in the absence of procedure code 00.63 results in assignment to MS-DRGs 037, 038, and 039 according to the MS-DRG logic because procedure code 00.61 has an inclusion term for vertebral vessels, as well as for the carotid vessels. Therefore, when all of the comparable translations of procedure code 00.61 as an O.R. procedure were replicated from the ICD-9 based MS-DRGs to the ICD-10 based MS-DRGs, this replication inadvertently results in the assignment of ICD-10-PCS procedure codes that identify and describe a carotid artery stent procedure to MS-DRGs 037, 038, and 039. Therefore, we are proposing to remove the 96 ICD-10-PCS procedure codes describing dilation of a carotid artery with an intraluminal device from MS-DRGs 037, 038, and 039.

We also found 6 procedure codes describing dilation of a carotid artery with an intraluminal device in MS-DRGs 037, 038, and 039 that are not currently assigned to MS-DRGs 034, 035, and 036. Our clinical advisors recommended that these 6 procedure codes be reassigned from MS-DRGs 037, 038, and 039 to MS-DRGs 034, 035, and 036 because the 6 procedure codes are consistent with the other procedures describing dilation of a carotid artery with an intraluminal device that are currently assigned to MS-DRGs 034, 035, and 036. We refer readers to Table 6P.1b. associated with this proposed rule (which is available via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html) for the complete list of procedure codes that we are proposing to remove from MS-DRGs 037, 038, and 039.

We also note that, as discussed in section II.F.14.f. of the preamble of this proposed rule, we are deleting a number of codes that include the ICD-10-PCS qualifier term “bifurcation” as the result of the finalized proposal discussed at the September 11-12, 2018 ICD-10 Coordination and Maintenance Committee meeting. We refer readers to the website at: https://www.cms.gov/​Medicare/​Coding/​ICD9ProviderDiagnosticCodes/​ICD-9-CM-C-and-M-Meeting-Materials.html for the committee meeting materials and discussion regarding this proposal. We note that, of the 96 procedure codes that we are proposing to remove from the logic for MS-DRGs 037, 038, and 039, there are 48 procedure codes that include the qualifier term “bifurcation”. Therefore, these 48 procedure codes will be deleted effective October 1, 2019. The 48 remaining valid procedure codes that do not include the term “bifurcation” that we are proposing to remove from MS-DRGs 037, 038, and 039 will continue to be assigned to MS-DRGs 034, 035, and 036.

Lastly, if the applicable proposed MS-DRG changes are finalized, we would make a conforming change to the ICD-10 MS-DRG Version 37 Definitions Manual for FY 2020 by combining all the procedure codes identifying a carotid artery stent procedure within MS-DRGs 034, 035, and 036 into one list entitled “Operating Room Procedures” to better reflect the Start Printed Page 19185definition of these MS-DRGs based on the discussion and proposals described above.

4. MDC 4 (Diseases and Disorders of the Respiratory System): Pulmonary Embolism

We received a request to reassign three ICD-10-CM diagnosis codes for pulmonary embolism with acute cor pulmonale from MS-DRG 176 (Pulmonary Embolism without MCC) to the higher severity level MS-DRG 175 (Pulmonary Embolism with MCC). The three diagnosis codes are identified in the following table.

ICD-10-CM codeCode description
I26.01Septic pulmonary embolism with acute cor pulmonale.
I26.02Saddle embolus of pulmonary artery with acute cor pulmonale.
I26.09Other pulmonary embolism with acute cor pulmonale.

The requestor noted that, in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41231 through 41234), we finalized the proposal to remove the special logic in the GROUPER for processing claims containing a code on the Principal Diagnosis Is Its Own CC or MCC Lists and deleted the relevant tables from the ICD-10 MS-DRG Definitions Manual Version 36, effective October 1, 2018. As a result of this change, cases reporting any one of the three ICD-10-CM diagnosis codes describing a pulmonary embolism with acute cor pulmonale were reassigned from MS-DRG 175 to MS-DRG 176, absent a secondary diagnosis code to trigger assignment to MS-DRG 175. The requestor stated that this change in the MS-DRG assignment for these cases resulted in a reduction in payment for cases involving pulmonary embolism with acute cor pulmonale and that the FY 2019 payment rate for MS-DRG 176 does not appropriately account for the costs and resource utilization associated with these cases because the subset of patients with pulmonary embolism with acute cor pulmonale often represents a more severe set of patients with pulmonary embolism.

The logic for case assignment to MS-DRGs 175 and 176 is displayed in the ICD-10 MS-DRG Version 36 Definitions Manual, which is available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​MS-DRG-Classifications-and-Software.html.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 175 and 176 to identify cases reporting diagnosis codes describing pulmonary embolism with acute cor pulmonale as listed above (ICD-10-CM diagnosis codes I26.01, I26.02 or I26.09) as the principal diagnosis or as a secondary diagnosis. Our findings are shown in the following table.

MS-DRGs for Pulmonary Embolism

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 175—All cases24,3895.2$10,294
MS-DRG 175—Cases with pulmonary embolism with acute cor pulmonale2,3265.713,034
MS-DRG 176—All cases30,2153.36,356
MS-DRG 176—Cases with pulmonary embolism with acute cor pulmonale1,8213.99,630

As shown in the table, for MS-DRG 175, there was a total of 24,389 cases with an average length of stay of 5.2 days and average costs of $10,294. Of these 24,389 cases, there were 2,326 cases reporting pulmonary embolism with acute cor pulmonale, with an average length of stay 5.7 days and average costs of $13,034. For MS-DRG 176, there was a total of 30,215 cases with an average length of stay of 3.3 days and average costs of $6,356. Of these 30,215 cases, there were 1,821 cases reporting pulmonary embolism with acute cor pulmonale with an average length of stay of 3.9 days and average costs of $9,630.

As stated in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41231 through 41234), available ICD-10 data can now be used to evaluate other indicators of resource utilization and, as shown by our claims analysis, the data indicate that the average costs of cases reporting pulmonary embolism or saddle embolus with acute cor pulmonale ($9,630) in MS-DRG 176 are closer to the average costs for all pulmonary embolism cases in MS-DRG 175 ($10,294) as compared to the average costs for all cases in MS-DRG 176 ($6,356). Our clinical advisors also agree that this subset of patients with acute cor pulmonale often represents a more severe set of patients and that these cases are more appropriately assigned to the higher severity level “with MCC” MS-DRG. Therefore, we are proposing to reassign cases reporting diagnosis code I26.01, I26.02, or I26.09 to the higher severity level MS-DRG 175 and to revise the title for MS-DRG 175 to “Pulmonary Embolism with MCC or Acute Cor Pulmonale” to more accurately reflect the diagnoses assigned there.

5. MDC 5 (Diseases and Disorders of the Circulatory System)

a. Transcatheter Mitral Valve Repair With Implant

As we did for the FY 2015 IPPS/LTCH PPS proposed rule (79 FR 28008 through 28010) and for the FY 2017 IPPS/LTCH PPS proposed rule (81 FR 24985 through 24989), for FY 2020, we received a request to modify the MS-DRG assignment for transcatheter mitral valve repair (TMVR) with implant procedures. ICD-10-PCS procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach) identifies and describes this procedure. This request also included the suggestion that CMS give consideration to reclassifying other endovascular cardiac valve repair procedures. Specifically, the requestor recommended that cases reporting procedure codes describing an endovascular cardiac valve repair with implant be reassigned to MS-DRGs 266 and 267 (Endovascular Cardiac Valve Replacement with and without MCC, respectively) and that the MS-DRG titles be revised to Endovascular Cardiac Valve Interventions with Implant with and without MCC, respectively. We refer readers to detailed discussions of Start Printed Page 19186the MitraClip® System (hereafter referred to as MitraClip®) for transcatheter mitral valve repair in previous rulemakings, including the FY 2012 IPPS/LTCH PPS proposed rule (76 FR 25822) and final rule (76 FR 51528 through 51529), the FY 2013 IPPS/LTCH PPS proposed rule (77 FR 27902 through 27903) and final rule (77 FR 53308 through 53310), the FY 2015 IPPS/LTCH PPS proposed rule (79 FR 28008 through 28010) and final rule (79 FR 49889 through 49892), the FY 2016 IPPS/LTCH PPS proposed rule (80 FR 24356 through 24359) and final rule (80 FR 49363 through 49367), and the FY 2017 IPPS/LTCH PPS proposed rule (81 FR 24985 through 24989) and final rule (81 FR 56809 through 56813), in response to requests for MS-DRG reclassification, as well as the FY 2014 IPPS/LTCH PPS proposed rule (78 FR 27547 through 27552), under the new technology add-on payment policy. In the FY 2014 IPPS/LTCH PPS final rule (78 FR 50575), we were unable to consider further the application for a new technology add-on payment for MitraClip® because the technology had not received FDA approval by the July 1, 2013 deadline.

In the FY 2015 IPPS/LTCH PPS final rule, we finalized our proposal to not create a new MS-DRG or to reassign cases reporting ICD-9-CM procedure code 35.97 that described procedures involving the MitraClip® to another MS-DRG (79 FR 49889 through 49892). Under a new application, the request for new technology add-on payments for the MitraClip® System was approved for FY 2015 (79 FR 49941 through 49946). The new technology add-on payment for MitraClip® was subsequently discontinued effective FY 2017.

In the FY 2016 IPPS/LTCH PPS final rule (80 FR 49371), we finalized a modification to the MS-DRGs to which procedures involving the MitraClip® were assigned. For the ICD-10 based MS-DRGs to fully replicate the ICD-9-CM based MS-DRGs, ICD-10-PCS code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach), which identifies the MitraClip® technology and is the ICD-10-PCS code translation for ICD-9-CM procedure code 35.97 (Percutaneous mitral valve repair with implant), was assigned to new MS-DRGs 273 and 274 (Percutaneous Intracardiac Procedures with MCC and without MCC, respectively) and continued to be assigned to MS-DRGs 231 and 232 (Coronary Bypass with PTCA with MCC and without MCC, respectively).

In the FY 2017 IPPS/LTCH PPS proposed and final rules, we also discussed our analysis of MS-DRGs 228, 229, and 230 (Other Cardiothoracic Procedures with MCC, with CC, and without CC/MCC, respectively) with regard to the possible reassignment of cases reporting ICD-10-PCS procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach). We finalized our proposal to collapse these MS-DRGs (228, 229, and 230) from three severity levels to two severity levels by deleting MS-DRG 230 and revising the structure of MS-DRG 229. We also finalized our proposal to reassign ICD-10-PCS procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach) from MS-DRGs 273 and 274 to MS-DRG 228 and revised MS-DRG 229 (81 FR 56813).

According to the requestor, there are substantial clinical and resource differences between the transcatheter mitral valve repair (TMVR) procedure and other procedures currently grouping to MS-DRGs 228 and 229. The requestor noted that, currently, ICD-10-PCS procedure code 02UG3JZ is the only endovascular valve intervention with implant procedure that maps to MS-DRGs 228 and 229. The requestor also noted that other ICD-10-PCS procedure codes describing procedures for endovascular (transcatheter) cardiac valve repair with implant map to MS-DRGs 273 and 274 or to MS-DRGs 216, 217, 218, 219, 220, and 221 (Cardiac Valve and Other Major Cardiothoracic Procedures with and without Cardiac Catheterization with MCC, with CC and without CC/MCC, respectively). The requestor further noted that all ICD-10-PCS procedure codes for endovascular cardiac valve replacement procedures map to MS-DRGs 266 (Endovascular Cardiac Valve Replacement with MCC) and 267 (Endovascular Cardiac Valve Replacement without MCC).

The ICD-10-PCS procedure codes describing a transcatheter cardiac valve repair procedure with an implant are listed in the following table.

ICD-10-PCS codeDescription
02UF37JSupplement aortic valve created from truncal valve with autologous tissue substitute, percutaneous approach.
02UF37ZSupplement aortic valve with autologous tissue substitute, percutaneous approach.
02UF38JSupplement aortic valve created from truncal valve with zooplastic tissue, percutaneous approach.
02UF38ZSupplement aortic valve with zooplastic tissue, percutaneous approach.
02UF3JJSupplement aortic valve created from truncal valve with synthetic substitute, percutaneous approach.
02UF3JZSupplement aortic valve with synthetic substitute, percutaneous approach.
02UF3KJSupplement aortic valve created from truncal valve with nonautologous tissue substitute, percutaneous approach.
02UF3KZSupplement aortic valve with nonautologous tissue substitute, percutaneous approach.
02UG37ESupplement mitral valve created from left atrioventricular valve with autologous tissue substitute, percutaneous approach.
02UG37ZSupplement mitral valve with autologous tissue substitute, percutaneous approach.
02UG38ESupplement mitral valve created from left atrioventricular valve with zooplastic tissue, percutaneous approach.
02UG38ZSupplement mitral valve with zooplastic tissue, percutaneous approach.
02UG3KESupplement mitral valve created from left atrioventricular valve with nonautologous tissue substitute, percutaneous approach.
02UG3KZSupplement mitral valve with nonautologous tissue substitute, percutaneous approach.
02UG3JESupplement mitral valve created from left atrioventricular valve with synthetic substitute, percutaneous approach.
02UG3JZSupplement mitral valve with synthetic substitute, percutaneous approach.
02UH37ZSupplement pulmonary valve with autologous tissue substitute, percutaneous approach.
02UH38ZSupplement pulmonary valve with zooplastic tissue, percutaneous approach.
02UH3JZSupplement pulmonary valve with synthetic substitute, percutaneous approach.
02UH3KZSupplement pulmonary valve with nonautologous tissue substitute, percutaneous approach.
02UJ37GSupplement tricuspid valve created from right atrioventricular valve with autologous tissue substitute, percutaneous approach.
02UJ37ZSupplement tricuspid valve with autologous tissue substitute, percutaneous approach.
02UJ38GSupplement tricuspid valve created from right atrioventricular valve with zooplastic tissue, percutaneous approach.
02UJ38ZSupplement tricuspid valve with zooplastic tissue, percutaneous approach.
02UJ3JGSupplement tricuspid valve created from right atrioventricular valve with synthetic substitute, percutaneous approach.
02UJ3JZSupplement tricuspid valve with synthetic substitute, percutaneous approach.
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02UJ3KGSupplement tricuspid valve created from right atrioventricular valve with nonautologous tissue substitute, percutaneous approach.
02UJ3KZSupplement tricuspid valve with nonautologous tissue substitute, percutaneous approach.

The ICD-10-PCS procedure codes describing a transcatheter cardiac valve replacement procedure are listed in the following table.

ICD-10-PCS codeDescription
02RF37HReplacement of aortic valve with autologous tissue substitute, transapical, percutaneous approach.
02RF37ZReplacement of aortic valve with autologous tissue substitute, percutaneous approach.
02RF38HReplacement of aortic valve with zooplastic tissue, transapical, percutaneous approach.
02RF38ZReplacement of aortic valve with zooplastic tissue, percutaneous approach.
02RF3JHReplacement of aortic valve with synthetic substitute, transapical, percutaneous approach.
02RF3JZReplacement of aortic valve with synthetic substitute, percutaneous approach.
02RF3KHReplacement of aortic valve with nonautologous tissue substitute, transapical, percutaneous approach.
02RF3KZReplacement of aortic valve with nonautologous tissue substitute, percutaneous approach.
02RG37HReplacement of mitral valve with autologous tissue substitute, transapical, percutaneous approach.
02RG37ZReplacement of mitral valve with autologous tissue substitute, percutaneous approach.
02RG38HReplacement of mitral valve with zooplastic tissue, transapical, percutaneous approach.
02RG38ZReplacement of mitral valve with zooplastic tissue, percutaneous approach.
02RG3JHReplacement of mitral valve with synthetic substitute, transapical, percutaneous approach.
02RG3JZReplacement of mitral valve with synthetic substitute, percutaneous approach.
02RG3KHReplacement of mitral valve with nonautologous tissue substitute, transapical, percutaneous approach.
02RG3KZReplacement of mitral valve with nonautologous tissue substitute, percutaneous approach.
02RH37HReplacement of pulmonary valve with autologous tissue substitute, transapical, percutaneous approach.
02RH37ZReplacement of pulmonary valve with autologous tissue substitute, percutaneous approach.
02RH38HReplacement of pulmonary valve with zooplastic tissue, transapical, percutaneous approach.
02RH38ZReplacement of pulmonary valve with zooplastic tissue, percutaneous approach.
02RH3JHReplacement of pulmonary valve with synthetic substitute, transapical, percutaneous approach.
02RH3JZReplacement of pulmonary valve with synthetic substitute, percutaneous approach.
02RH3KHReplacement of pulmonary valve with nonautologous tissue substitute, transapical, percutaneous approach.
02RH3KZReplacement of pulmonary valve with nonautologous tissue substitute, percutaneous approach.
02RJ37HReplacement of tricuspid valve with autologous tissue substitute, transapical, percutaneous approach.
02RJ37ZReplacement of tricuspid valve with autologous tissue substitute, percutaneous approach.
02RJ38HReplacement of tricuspid valve with zooplastic tissue, transapical, percutaneous approach.
02RJ38ZReplacement of tricuspid valve with zooplastic tissue, percutaneous approach.
02RJ3JHReplacement of tricuspid valve with synthetic substitute, transapical, percutaneous approach.
02RJ3JZReplacement of tricuspid valve with synthetic substitute, percutaneous approach.
02RJ3KHReplacement of tricuspid valve with nonautologous tissue substitute, transapical, percutaneous approach.
02RJ3KZReplacement of tricuspid valve with nonautologous tissue substitute, percutaneous approach.
X2RF332Replacement of aortic valve using zooplastic tissue, rapid deployment technique, percutaneous approach, new technology group 2.

The requestor performed its own analyses, first comparing TMVR procedures (ICD-10-PCS procedure code 02UG3JZ) to other procedures currently assigned to MS-DRGs 228 and 229, as well as to the transcatheter cardiac valve replacement procedures in MS-DRGs 266 and 267. We refer the reader to the ICD-10 MS-DRG Version 36 Definitions Manual for complete documentation of the logic for case assignment to MS-DRGs 228 and 229 (which is available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​MS-DRG-Classifications-and-Software.html). According to the requestor, its findings indicate that TMVR is more closely aligned with MS-DRGs 266 and 267 than MS-DRGs 228 and 229 with regard to average length of stay and average [standardized] costs. The requestor also examined the impact of removing cases reporting a TMVR procedure (ICD-10-PCS procedure code 02UG3JZ) from MS-DRGs 228 and 229 and adding those cases to MS-DRGs 266 and 267. The requestor noted this movement would have minimal impact to MS-DRGs 266 and 267 based on its analysis. In addition, the requestor stated that its request is in alignment with CMS' policy goal of creating and maintaining clinically coherent MS-DRGs.

The requestor acknowledged that CMS has indicated in prior rulemaking that TMVR procedures are not clinically similar to endovascular cardiac valve replacement procedures, and the requestor agreed that they are distinct procedures. However, the requestor also believed that TMVR is more similar to the replacement procedures in MS-DRGs 266 and 267 compared to the other procedures currently assigned to MS-DRGs 228 and 229. The requestor provided the following table of procedures in volume order (highest to lowest) to illustrate the clinical differences between TMVR procedures and other procedures currently assigned to MS-DRGs 228 and 229.

ProcedureApproachAnatomy treatedICD-10-PCS root operationImplanted device
TMVRPercutaneousValvesSupplementSubstitute.
DestructionOpenAtriaDestructionNone.
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Coronary AtherectomyOpenCoronary ArteryExtirpationNone.
InsertionPercutaneousAtria or VentriclesInsertionPacemaker or Intraluminal Device.
DestructionPercutaneousAtriaDestructionsNone.
Structural Heart RepairOpenSeptum, Heart, Chordae Tendinae, or Papillary MuscleRepairNone.
Structural Heart ExcisionOpenSeptum, Atria, Ventricles, Chordae Tendinae, or Papillary MuscleExcisionNone.

The requestor noted that, among the procedures listed in the table, TMVR is the only procedure that involves treatment of a cardiac valve and is the only procedure that involves implanting a synthetic substitute.

To illustrate the similarities between TMVR procedures and endovascular cardiac valve replacements in MS-DRGs 266 and 267, the requestor provided the following table.

ProcedureApproachAnatomy treatedICD-10-PCS root operationImplanted device
TMVRPercutaneousValvesSupplementSubstitute.
Endovascular Cardiac Valve ReplacementPercutaneousValvesReplacementSubstitute.

The requestor noted that both TMVR procedures and endovascular cardiac valve replacements use a percutaneous approach, treat cardiac valves, and use an implanted device for purposes of improving the function of the specified valve. The requestor believed that the analyses support the request to group TMVR procedures with endovascular cardiac valve replacements from a resource perspective and an improvement to clinical coherence could be achieved because TMVR procedures are more similar to the endovascular cardiac valve replacements compared to the other procedures in MS-DRGs 228 and 229, where TMVR is currently assigned.

As noted earlier in this section, the request also included the suggestion that CMS give consideration to reclassifying other endovascular cardiac valve repair with implant procedures to MS-DRGs 266 and 267; specifically, endovascular cardiac valve repair with implant procedures involving the aortic, pulmonary, tricuspid and other non-TMVR mitral valve procedures that currently group to MS-DRGs 273 and 274 or MS-DRGs 216, 217, 218, 219, 220 and 221. The requestor acknowledged that endovascular cardiac valve repair with implant procedures involving these other cardiac valves have lower volumes in comparison to the TMVR procedure (ICD-10-PCS procedure code 02UG3JZ), which makes analysis of these procedures a little more difficult. However, the requestor suggested that movement of these procedures to MS-DRGs 266 and 267 would enable the ability to maintain clinical coherence for all endovascular cardiac valve interventions. The requestor also stated that there is an anticipated increase in the volume of not only the TMVR procedure described by ICD-10-PCS procedure code 02UG3JZ (which has grown annually since the MitraClip® was approved for new technology add-on payment in FY 2015), but also for the other endovascular cardiac valve repair with implant procedures, such as those involving the tricuspid valve, which are currently under study in the United States and Europe. Based on this anticipated increase in volume for endovascular cardiac valve repair with implant procedures, the requestor believed that it would be advantageous to take this opportunity to restructure the MS-DRGs by moving all the endovascular cardiac valve repair with implant procedures to MS-DRGs 266 and 267 with revised titles as noted previously, to improve clinical consistency beginning in FY 2020. The requestor further noted that while the requestor believes its request reflects the best approach for appropriate MS-DRG assignment for TMVR and other endovascular cardiac valve repair with implant procedures, the requestor understands that CMS may consider other alternatives.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting ICD-10-PCS procedure code 02UG3JZ in MS-DRGs 228 and 229 as well as cases reporting one of the procedure codes listed above describing a transcatheter cardiac valve repair with implant procedure in MS-DRGs 216, 217, 218, 219, 220, 221, 273, and 274. Our findings are shown in the tables below.

MS-DRGs for Transcatheter Cardiac Valve Repair With Implant Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 216—All cases5,90916$70,435
MS-DRG 216—Cases with procedure codes for transcatheter cardiac valve repair4812.672,556
MS-DRG 217—All cases2,1669.447,299
MS-DRG 217—Cases with procedure codes for transcatheter cardiac valve repair253.440,707
MS-DRG 218—All cases2686.839,501
MS-DRG 218—Cases with procedure codes for transcatheter cardiac valve repair41.345,903
MS-DRG 219—All cases15,10510.955,423
MS-DRG 219—Cases with procedure codes for transcatheter cardiac valve repair557.165,880
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MS-DRG 220—All cases15,8896.638,313
MS-DRG 220—Cases with procedure codes for transcatheter cardiac valve repair40338,906
MS-DRG 221—All cases2,6524.733,577
MS-DRG 221—Cases with procedure codes for transcatheter cardiac valve repair132.229,646
MS-DRG 228—All cases5,5839.246,613
MS-DRG 228—Cases with procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach)1,6885.649,569
MS-DRG 229—All cases6,5934.332,322
MS-DRG 229—Cases with procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach)2,0181.738,321
MS-DRG 273—All cases7,7856.927,200
MS-DRG 273—Cases with procedure codes for transcatheter cardiac valve repair67.552,370
MS-DRG 274—All cases20,4342.322,771
MS-DRG 274—Cases with procedure codes for transcatheter cardiac valve repair71.428,152

As shown in the table, we found a total of 5,909 cases for MS-DRG 216 with an average length of stay of 16 days and average costs of $70,435. Of those 5,909 cases, there were 48 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 12.6 days and average costs of $72,556. We found a total of 2,166 cases for MS-DRG 217 with an average length of stay of 9.4 days and average costs of $47,299. Of those 2,166 cases, there was a total of 25 cases reporting a procedure for a transcatheter cardiac valve repair with an average length of stay of 3.4 days and average costs of $40,707. We found a total of 268 cases for MS-DRG 218 with an average length of stay of 6.8 days and average costs of $39,501. Of those 268 cases, there were 4 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 1.3 days and average costs of $45,903. We found a total of 15,105 cases for MS-DRG 219 with an average length of stay of 10.9 days and average costs of $55,423. Of those 15,105 cases, there were 55 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 7.1 days and average costs of $65,880. We found a total of 15,889 cases for MS-DRG 220 with an average length of stay of 6.6 days and average costs of $38,313. Of those 15,889 cases, there were 40 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 3 days and average costs of $38,906. We found a total of 2,652 cases for MS-DRG 221 with an average length of stay of 4.7 days and average costs of $33,577. Of those 2,652 cases, there were 13 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 2.2 days and average costs of $29,646.

For MS-DRG 228, we found a total of 5,583 cases with an average length of stay of 9.2 days and average costs of $46,613. Of those 5,583 cases, there were 1,688 cases reporting ICD-10-PCS procedure code 02UG3JZ (Supplement mitral valve with synthetic substitute, percutaneous approach) with an average length of stay of 5.6 days and average costs of $49,569. As noted previously, ICD-10-PCS procedure code 02UG3JZ is the only endovascular cardiac valve repair with implant procedure assigned to MS-DRGs 228 and 229. We found a total of 6,593 cases for MS-DRG 229 with an average length of stay of 4.3 days and average costs of $32,322. Of those 6,593 cases, there were 2,018 cases reporting ICD-10-PCS procedure code 02UG3JZ with an average length of stay of 1.7 days and average costs of $38,321.

For MS-DRG 273, we found a total of 7,785 cases with an average length of stay of 6.9 days and average costs of $27,200. Of those 7,785 cases, there were 6 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 7.5 days and average costs of $52,370. We found a total of 20,434 cases in MS-DRG 274 with an average length of stay of 2.3 days and average costs of $22,771. Of those 20,434 cases, there were 7 cases reporting a procedure code for a transcatheter cardiac valve repair with an average length of stay of 1.4 days and average costs of $28,152.

We also analyzed cases reporting any one of the procedure codes listed above describing a transcatheter cardiac valve replacement procedure in MS-DRGs 266 and 267. Our findings are shown in the table below.

MS-DRGs for Transcatheter Cardiac Valve Replacement Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 266—All cases15,0795.6$51,402
MS-DRG 267—All cases20,8452.441,891

As shown in the table, there was a total of 15,079 cases with an average length of stay of 5.6 days and average costs of $51,402 in MS-DRG 266. For MS-DRG 267, there was a total of 20,845 cases with an average length of stay of 2.4 days and average costs of $41,891.

As stated previously, the requestor noted that ICD-10-PCS procedure code 02UG3JZ describing a transcatheter mitral valve repair with implant procedure is the only endovascular cardiac valve intervention with implant procedure assigned to MS-DRGs 228 and 229. The data analysis shows that for the cases reporting procedure code 02UG3JZ in MS-DRGs 228 and 229, the average length of stay and average costs are aligned with the average length of stay and average costs of cases in MS-DRGs 266 and 267, respectively.

The data also show that, for MS-DRGs 216, 217, 218, 219, 220, and 221 and for Start Printed Page 19190MS-DRG 274, the average length of stay for cases reporting a transcatheter cardiac valve with implant procedure is shorter than the average length of stay for all the cases in their assigned MS-DRG. For MS-DRG 273, the average length of stay for cases reporting a transcatheter cardiac valve with implant procedure is slightly longer (7.5 days versus 6.9 days). In addition, the average costs for the cases reporting a transcatheter cardiac valve with implant procedure are higher when compared to all the cases in their assigned MS-DRG with the exception of MS-DRG 217 ($40,707 versus $47,299) and MS-DRG 221 ($29,646 versus $33,577).

Our clinical advisors continue to believe that transcatheter cardiac valve repair procedures are not the same as a transcatheter (endovascular) cardiac valve replacement. However, they agree with the requestor and, based on our data analysis, that these procedures are more clinically coherent in that they also describe endovascular cardiac valve interventions with implants and are similar in terms of average length of stay and average costs to cases in MS-DRGs 266 and 267 when compared to other procedures in their current MS-DRG assignment. For these reasons, our clinical advisors agree that we should propose to reassign the endovascular cardiac valve repair procedures (supplement procedures) listed previously to the endovascular cardiac valve replacement MS-DRGs.

We analyzed the impact of grouping the endovascular cardiac valve repair with implant (supplement) procedures with the endovascular cardiac valve replacement procedures. The following table reflects our findings for the proposed revised endovascular cardiac valve (supplement) procedures with the endovascular cardiac valve replacement MS-DRGs with a 2-way severity level split.

Proposed Revised MS-DRGs for Endovascular Cardiac Valve Replacement and Supplement Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 266 (Endovascular Cardiac Valve Replacement and Supplement Procedures with MCC)16,9225.7$51,564
MS-DRG 267 (Endovascular Cardiac Valve Replacement and Supplement Procedures without MCC)22,9582.441,563.

As shown in the table, there was a total of 16,922 cases for the endovascular cardiac valve replacement and supplement procedures with MCC group, with an average length of stay of 5.7 days and average costs of $51,564. There was a total of 22,958 cases for the endovascular cardiac valve replacement and supplement procedures without MCC group, with an average length of stay of 2.4 days and average costs of $41,563. We applied the criteria to create subgroups for the two-way severity level split for the proposed revised MS-DRGs and found that all five criteria were met. For the proposed revised MS-DRGs, there is at least (1) 500 or more cases in the MCC group or in the without MCC subgroup; (2) 5 percent or more of the cases in the MCC group or in the without MCC subgroup; (3) a 20 percent difference in average costs between the MCC group and the without MCC group; (4) a $2,000 difference in average costs between the MCC group and the without MCC group; and (5) a 3-percent reduction in cost variance, indicating that the proposed severity level splits increase the explanatory power of the base MS-DRG in capturing differences in expected cost between the proposed MS-DRG severity level splits by at least 3 percent and thus improve the overall accuracy of the IPPS payment system.

During our review of the transcatheter cardiac valve repair (supplement) procedures in MS-DRGs 216, 217, 218, 219, 220, and 221, MS-DRGs 228 and 229, and MS-DRGs 273 and 274, our clinical advisors recommended that we also analyze the claims data to identify other (non-supplement) transcatheter (endovascular) procedures that involve the cardiac valves and are assigned to those same MS-DRGs to determine if additional modifications may be warranted, consistent with our ongoing efforts to refine the ICD-10 MS-DRGs.

We analyzed the following ICD-10-PCS procedure codes that are currently assigned to MS-DRGs 216, 217, 218, 219, 220, and 221.

ICD-10-PCS codeDescription
02QF3ZJRepair aortic valve created from truncal valve, percutaneous approach.
02QF3ZZRepair aortic valve, percutaneous approach.
02QG3ZERepair mitral valve created from left atrioventricular valve, percutaneous approach.
02QG3ZZRepair mitral valve, percutaneous approach.
02QH3ZZRepair pulmonary valve, percutaneous approach.
02QJ3ZGRepair tricuspid valve created from right atrioventricular valve, percutaneous approach.
02QJ3ZZRepair tricuspid valve, percutaneous approach.
02TH3ZZResection of pulmonary valve, percutaneous approach.
02VG3ZZRestriction of mitral valve, percutaneous approach.
02WF38ZRevision of zooplastic tissue in aortic valve, percutaneous approach.
02WF3JZRevision of synthetic substitute in aortic valve, percutaneous approach.
02WF3KZRevision of nonautologous tissue substitute in aortic valve, percutaneous approach.
02WG37ZRevision of autologous tissue substitute in mitral valve, percutaneous approach.
02WG38ZRevision of zooplastic tissue in mitral valve, percutaneous approach.
02WG3JZRevision of synthetic substitute in mitral valve, percutaneous approach.
02WG3KZRevision of nonautologous tissue substitute in mitral valve, percutaneous approach.
02WH37ZRevision of autologous tissue substitute in pulmonary valve, percutaneous approach.
02WH38ZRevision of zooplastic tissue in pulmonary valve, percutaneous approach.
02WH3JZRevision of synthetic substitute in pulmonary valve, percutaneous approach.
02WH3KZRevision of nonautologous tissue substitute in pulmonary valve, percutaneous approach.
02WJ37ZRevision of autologous tissue substitute in tricuspid valve, percutaneous approach.
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02WJ38ZRevision of zooplastic tissue in tricuspid valve, percutaneous approach.
02WJ3JZRevision of synthetic substitute in tricuspid valve, percutaneous approach.
02WJ3KZRevision of nonautologous tissue substitute in tricuspid valve, percutaneous approach.

We also analyzed ICD-10-PCS procedure code 02TH3ZZ (Resection of pulmonary valve, percutaneous approach) that is currently assigned to MS-DRGs 228 and 229. Lastly, we analyzed the following ICD-10-PCS procedure codes that are currently assigned to MS-DRGs 273 and 274.

ICD-10-PCS codeDescription
025F3ZZDestruction of aortic valve, percutaneous approach.
025G3ZZDestruction of mitral valve, percutaneous approach.
025H3ZZDestruction of pulmonary valve, percutaneous approach.
025J3ZZDestruction of tricuspid valve, percutaneous approach.
027F34ZDilation of aortic valve with drug-eluting intraluminal device, percutaneous approach.
027F3DZDilation of aortic valve with intraluminal device, percutaneous approach.
027F3ZZDilation of aortic valve, percutaneous approach.
027G34ZDilation of mitral valve with drug-eluting intraluminal device, percutaneous approach.
027G3DZDilation of mitral valve with intraluminal device, percutaneous approach.
027G3ZZDilation of mitral valve, percutaneous approach.
027H34ZDilation of pulmonary valve with drug-eluting intraluminal device, percutaneous approach.
027H3DZDilation of pulmonary valve with intraluminal device, percutaneous approach.
027H3ZZDilation of pulmonary valve, percutaneous approach.
027J34ZDilation of tricuspid valve with drug-eluting intraluminal device, percutaneous approach.
027J3DZDilation of tricuspid valve with intraluminal device, percutaneous approach.
027J3ZZDilation of tricuspid valve, percutaneous approach.
02BF3ZZExcision of aortic valve, percutaneous approach.
02BG3ZZExcision of mitral valve, percutaneous approach.
02BH3ZZExcision of pulmonary valve, percutaneous approach.
02BJ3ZZExcision of tricuspid valve, percutaneous approach.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting any of the above listed procedure codes in MS-DRGs 216, 217, 218, 219, 220, and 221, MS-DRGs 228 and 229, and MS-DRGs 273 and 274. Our findings are shown in the following tables. We note that there were no cases found in MS-DRGs 228 and 229 reporting ICD-10-PCS procedure code 02TH3ZZ (Resection of pulmonary valve, percutaneous approach).

Other Cardiac Valve Procedures in MS-DRGs 216 Through 221

ICD-10-PCS codeDescriptionNumber of times reportedAverage length of stayAverage costs
02QF3ZZRepair aortic valve, percutaneous approach589.7$33,588
02QG3ZERepair mitral valve created from left atrioventricular valve, percutaneous approach41.338,680
02QG3ZZRepair mitral valve, percutaneous approach403.430,160
02QH3ZZRepair pulmonary valve, percutaneous approach1133,014
02QJ3ZGRepair tricuspid valve created from right atrioventricular valve, percutaneous approach1951,294
02QJ3ZZRepair tricuspid valve, percutaneous approach15525,208
02VG3ZZRestriction of mitral valve, percutaneous approach118.153,798
02WF38ZRevision of zooplastic tissue in aortic valve, percutaneous approach268.961,124
02WF3JZRevision of synthetic substitute in aortic valve, percutaneous approach377.126,605
02WF3KZRevision of nonautologous tissue substitute in aortic valve, percutaneous approach2169,030
02WG38ZRevision of zooplastic tissue in mitral valve, percutaneous approach27.516,982
02WG3JZRevision of synthetic substitute in mitral valve, percutaneous approach317.328,682
02WH3JZRevision of synthetic substitute in pulmonary valve, percutaneous approach1630,340
02WJ3JZRevision of synthetic substitute in tricuspid valve, percutaneous approach1314,145
Total2307.134,968

Other Cardiac Valve Procedures in MS-DRGs 273 and 274

ICD-10-PCS codeDescriptionNumber of times reportedAverage length of stayAverage costs
025F3ZZDestruction of aortic valve, percutaneous approach64.7$11,130
Start Printed Page 19192
025J3ZZDestruction of tricuspid valve, percutaneous approach213.918,320
027F34ZDilation of aortic valve with drug-eluting intraluminal device, percutaneous approach11653,786
027F3DZDilation of aortic valve with intraluminal device, percutaneous approach58.420,951
027F3ZZDilation of aortic valve, percutaneous approach1,7208.625,265
027G3ZZDilation of mitral valve, percutaneous approach866.419,791
027H3ZZDilation of pulmonary valve, percutaneous approach53.810,506
02BJ3ZZExcision of tricuspid valve, percutaneous approach1430,843
Total1,8458.424,851

We found that the overall frequency with which cases reporting at least one of the above ICD-10-PCS procedure codes were reflected in the claims data was 2,075 times with an average length of stay of 8.5 days and average costs of $27,838. ICD-10-PCS procedure code 027F3ZZ (Dilation of aortic valve, percutaneous approach) had the highest frequency of 1,720 times with an average length of stay of 8.6 days and average costs of $25,265. We also found that cases reporting ICD-10-PCS procedure code 02WF3KZ (Revision of nonautologous tissue substitute in aortic valve, percutaneous approach) had the highest average costs of $69,030 with an average length of stay of 1 day. While not displayed above, we also note that, of the 7,785 cases found in MS-DRG 273, from the remaining procedure codes describing procedures other than those performed on a cardiac valve, there were 4,920 cases reporting ICD-10-PCS procedure code 02583ZZ (Destruction of conduction mechanism, percutaneous approach) with an average length of stay of 6.6 days and average costs of $26,800, representing approximately 63 percent of all the cases in that MS-DRG. In addition, of the 20,434 cases in MS-DRG 274, from the remaining procedure codes describing procedures other than those performed on a cardiac valve, there were 9,268 cases reporting ICD-10-PCS procedure code 02583ZZ (Destruction of conduction mechanism, percutaneous approach) with an average length of stay of 3.2 days and average costs of $21,689, and 8,775 cases reporting ICD-10-PCS procedure code 02L73DK (Occlusion of left atrial appendage with intraluminal device, percutaneous approach) with an average length of stay of 1.2 days and average costs of $25,476, representing approximately 88 percent of all the cases in that MS-DRG.

After analyzing the claims data to identify the overall frequency with which the other (non-supplement) ICD-10-PCS procedure codes describing a transcatheter (endovascular) cardiac valve procedure were reported and assigned to MS-DRGs 216, 217, 218, 219, 220, and 221, MS-DRGs 228 and 229, and MS-DRGs 273 and 274, our clinical advisors suggested that these other cardiac valve procedures should be grouped together because the procedure codes are describing procedures performed on a cardiac valve with a percutaneous (transcatheter/endovascular) approach, they can be performed in a cardiac catheterization laboratory, they require that the interventional cardiologist have special additional training and skills, and often require additional ancillary procedures and equipment, such as trans-esophageal echocardiography, be available at the time of the procedure. Our clinical advisors noted that these procedures are generally considered more complicated and resource-intensive, and form a clinically coherent group. They also noted that the majority of procedures currently being reported in MS-DRGs 273 and 274 are procedures other than those involving a cardiac valve and, therefore, believed that reassignment of the other (non-supplement) ICD-10-PCS procedure codes describing a transcatheter (endovascular) cardiac valve procedure would have minimal impact to those MS-DRGs.

We then analyzed the impact of grouping the other transcatheter cardiac valve procedures. The following table reflects our findings for the suggested other endovascular cardiac valve procedures MS-DRGs with a 2-way severity level split.

Suggested MS-DRGs for Other Endovascular Cardiac Valve Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG XXX (Other Endovascular Cardiac Valve Procedures with MCC)1,5279.7$27,801
MS-DRG XXX (Other Endovascular Cardiac Valve Procedures without MCC)5603.917,027

As shown in the table, there were 1,527 cases for the other endovascular cardiac valve procedures with MCC group, with an average length of stay of 9.7 days and average costs of $27,801. There was a total of 560 cases for the other endovascular cardiac valve procedures without MCC group, with an average length of stay of 3.9 days and average costs of $17,027. We applied the criteria to create subgroups for the two-way severity level split for the suggested MS-DRGs and found that all five criteria were met. For the suggested MS-DRGs, there is at least (1) 500 or more cases in the MCC group or in the without MCC subgroup; (2) 5 percent or more of the cases in the MCC group or in the without MCC subgroup; (3) a 20 percent difference in average costs between the MCC group and the without MCC group; (4) at least a $2,000 difference in average costs between the MCC group and the without MCC group; and (5) a 3-percent reduction in cost variance, indicating that the proposed severity level splits increase the explanatory power of the base MS-DRG in capturing differences in expected cost between the proposed MS-DRG severity level splits by at least 3 percent and thus improve the overall accuracy of the IPPS payment system.Start Printed Page 19193

For FY 2020, we are proposing to modify the structure of MS-DRGs 266 and 267 by reassigning the procedure codes describing a transcatheter cardiac valve repair (supplement) procedure from the list above and to revise the title of these MS-DRGs. We are proposing to revise the title of MS-DRGs 266 from “Endovascular Cardiac Valve Replacement with MCC” to “Endovascular Cardiac Valve Replacement and Supplement Procedures with MCC” and the title of MS-DRG 267 from “Endovascular Cardiac Valve Replacement without MCC” to “Endovascular Cardiac Valve Replacement and Supplement Procedures without MCC”, to reflect the proposed restructuring. We also are proposing to create two new MS-DRGs with a two-way severity level split for the remaining (non-supplement) transcatheter cardiac valve procedures listed above. These proposed new MS-DRGs are proposed new MS-DRG 319 (Other Endovascular Cardiac Valve Procedures with MCC) and proposed new MS-DRG 320 (Other Endovascular Cardiac Valve Procedures without MCC), which would also conform with the severity level split of MS-DRGs 266 and 267. We are proposing to reassign the procedure codes from their current MS-DRGs to the proposed new MS-DRGs.

b. Revision of Pacemaker Lead

In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41189 through 41190), we finalized our proposal to maintain the Version 35 ICD-10 MS-DRG GROUPER logic for the Version 36 ICD-10 MS-DRG GROUPER logic within MS-DRGs 260, 261, and 262 (Cardiac Pacemaker Revision Except Device Replacement with MCC, with CC and without CC/MCC, respectively) so that cases reporting any of the ICD-10-PCS procedure codes describing procedures involving pacemakers and related procedures and associated devices would continue to be assigned to those MS-DRGs under MDC 5 because they are reported when a pacemaker device requires revision and they have a corresponding circulatory system diagnosis. We also discussed and finalized the addition of ICD-10-PCS procedure codes 02H63MZ (Insertion of cardiac lead into right atrium, percutaneous approach) and 02H73MZ (Insertion of cardiac lead into left atrium, percutaneous approach) to the GROUPER logic as non-O.R. procedures that impact the MS-DRG assignment when reported as stand-alone codes for the insertion of a pacemaker lead within MS-DRGs 260, 261, and 262 in response to a commenter's suggestion.

After publication of the FY 2019 IPPS/LTCH PPS final rule, it was brought to our attention that ICD-10-PCS procedure code 02H60JZ (Insertion of pacemaker lead into right atrium, open approach) was inadvertently omitted from the GROUPER logic for MS-DRGs 260, 261, and 262. This procedure code is designated as a non-O.R. procedure. However, we note that, within MDC 5, in MS-DRGs 242, 243, and 244, this procedure code is part of a code pair that requires another procedure code (cluster). We are proposing to add procedure code 02H60JZ to the list of non-O.R. procedures that would impact MS-DRGs 260, 261, and 262 when reported as a stand-alone procedure code, consistent with ICD-10-PCS procedure codes 02H63JZ (Insertion of pacemaker lead into right atrium, percutaneous approach) and 02H64JZ (Insertion of pacemaker lead into right atrium, percutaneous endoscopic approach), which also describe the insertion of a pacemaker lead into the right atrium. If the proposal is finalized, we would make conforming changes to the ICD-10 MS-DRG Definitions Manual Version 37.

6. MDC 8 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue)

a. Knee Procedures With Principal Diagnosis of Infection

We received a request to add ICD-10-CM diagnosis codes M00.9 (Pyogenic arthritis, unspecified) and A54.42 (Gonococcal arthritis) to the list of principal diagnoses for MS-DRGs 485, 486, and 487 (Knee Procedure with Principal Diagnosis of Infection with MCC, with CC, and without CC/MCC, respectively) in MDC 8. The requestor believed that adding diagnosis code M00.9 is necessary to accurately recognize knee procedures that are performed with a principal diagnosis of infectious arthritis, including those procedures performed when the specific infectious agent is unknown. The requestor stated that, currently, only diagnosis codes describing infections caused by a specific bacterium are included in MS-DRGs 485, 486, and 487. The requestor stated that additional diagnosis codes such as M00.9 are indicated for knee procedures performed as a result of infection because pyogenic arthritis can reasonably be diagnosed based on the patient's history and clinical symptoms, even if a bacterial infection is not confirmed by culture. For example, the requestor noted that a culture may present negative for infection if a patient has been treated with antibiotics prior to knee surgery, but other clinical signs may indicate a principal diagnosis of joint infection. In the absence of a culture identifying an infection by a specific bacterium, the requestor stated that ICD-10-CM diagnosis code M00.09 should also be included as a principal diagnosis in MS-DRGs 485, 486, and 487.

The requestor also asserted that ICD-10-CM diagnosis code A54.42 should be added to the list of principal diagnoses for MS-DRGs 485, 486, and 487 because gonococcal arthritis is also an infectious type of arthritis that can be an indication for a knee procedure.

Currently, cases reporting ICD-10-CM diagnosis codes M00.9 or A54.42 as a principal diagnosis group to MS-DRGs 488 and 489 (Knee Procedures without Principal Diagnosis of Infection with and without CC/MCC, respectively) when a knee procedure is also reported on the claim.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for ICD-10-CM diagnosis codes M00.9 and A54.42, which are currently assigned to medical MS-DRGs 548, 549, and 550 (Septic Arthritis with MCC, with CC, and without CC/MCC, respectively) in the absence of a surgical procedure. Our findings are shown in the following table.

MS-DRGs for Septic Arthritis With Pyogenic Arthritis or Gonococcal Arthritis

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 548—All cases6018.1$13,974
MS-DRG 548—Cases with pyogenic arthritis as principal diagnosis3127.613,177
MS-DRG 549—All cases1,1695.08,547
MS-DRG 549—Cases with pyogenic arthritis as principal diagnosis6864.77,976
MS-DRG 549—Cases with gonococcal arthritis as principal diagnosis28.07,070
MS-DRG 550—All cases4023.56,317
Start Printed Page 19194
MS-DRG 550—Cases with pyogenic arthritis as principal diagnosis2603.26,209
MS-DRG 550—Cases with gonococcal arthritis as principal diagnosis32.33,929

As shown in the table, we found a total of 2,172 cases in MS-DRGs 548, 549, and 550. A total of 601 cases were reported in MS-DRG 548, with an average length of stay of 8.1 days and average costs of $13,974. Cases in MS-DRG 548 with a principal diagnosis of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) accounted for 312 of these 601 cases, and reported an average length of stay of 7.6 days and average costs of $13,177. None of the cases in MS-DRG 548 had a principal diagnosis of gonococcal arthritis (ICD-10-CM diagnosis code A54.42).

The total number of cases reported in MS-DRG 549 was 1,169, with an average length of stay of 5 days and average costs of $8,547. Within this MS-DRG, 686 cases had a principal diagnosis described by ICD-10-CM diagnosis code M00.9, with an average length of stay of 4.7 days and average costs of $7,976. Two of the cases reported in MS-DRG 549 had a principal diagnosis described by ICD-10-CM diagnosis code A54.42. These 2 cases had an average length of stay of 8 days and average costs of $7,070.

The total number of cases reported in MS-DRG 550 was 402, with an average length of stay of 3.5 days and average costs of $6,317. Within this MS-DRG, 260 cases had a principal diagnosis described by ICD-10-CM diagnosis code M00.9 with an average length of stay of 3.2 days and average costs of $6,209. Three of the cases reported in MS-DRG 550 had a principal diagnosis described by ICD-10-CM diagnosis code A54.42. These 3 cases had an average length of stay of 2.3 days and average costs of $3,929.

In summary, for MS-DRGs 548, 549, and 550, there were 1,258 cases that reported ICD-10-CM diagnosis code M00.9 as the principal diagnosis and 5 cases that reported ICD-10-CM diagnosis code A54.42 as the principal diagnosis. We note that, overall, our data analysis suggests that the MS-DRG assignment for cases reporting ICD-10-CM diagnosis codes M00.9 and A54.42 is appropriate based on the average costs and average length of stay. However, it is unclear how many of these cases involved infected knee joints because neither ICD-10-CM diagnosis code M00.9 nor A54.42 is specific to the knee. We then analyzed claims data for MS-DRGs 485, 486, and 487 (Knee Procedures with Principal Diagnosis of Infection with MCC, with CC, and without CC/MCC, respectively) and for MS-DRGs 488 and 489 (Knee Procedures without Principal Diagnosis of Infection with and without CC/MCC, respectively). For MS-DRGs 488 and 489, we also analyzed claims data for cases reporting a knee procedure with ICD-10-CM diagnosis code M00.9 or A54.42 as a principal diagnosis, as these are the MS-DRGs to which such cases would currently group. Our findings are shown in the following table.

MS-DRGs for Knee Procedures With and Without Infection

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 485—All cases1,0219.7$23,980
MS-DRG 486—All cases2,260616,060
MS-DRG 487—All cases6144.212,396
MS-DRG 488—All cases2,8574.814,197
MS-DRG 488—Cases with pyogenic arthritis as principal diagnosis5247.116,894
MS-DRG 489—All cases2,4162.49,217
MS-DRG 489—Cases with pyogenic arthritis as principal diagnosis1954.19,526
MS-DRG 489—Cases with gonococcal arthritis as principal diagnosis1810,810

As shown in the table, we found a total of 1,021 cases reported in MS-DRG 485, with an average length of stay of 9.7 days and average costs of $23,980. We found a total of 2,260 cases reported in MS-DRG 486, with an average length of stay of 6.0 days and average costs of $16,060. The total number of cases reported in MS-DRG 487 was 614, with an average length of stay of 4.2 days and average costs of $12,396. For MS-DRG 488, we found a total of 2,857 cases with an average length of stay of 4.8 days and average costs of $14,197. Of these 2,857 cases, we found 524 cases that reported a principal diagnosis of pyogenic arthritis (ICD-10-CM diagnosis code M00.9), with an average length of stay of 7.1 days and average costs of $16,894. There were no cases found that reported a principal diagnosis of gonococcal arthritis (ICD-10-CM diagnosis code A54.42). For MS-DRG 489, we found a total of 2,416 cases with an average length of stay of 2.4 days and average costs of $9,217. Of these 2,416 cases, we found 195 cases that reported a principal diagnosis of pyogenic arthritis (ICD-10-CM diagnosis code M00.9), with an average length of stay of 4.1 days and average costs of $9,526. We found 1 case that reported a principal diagnosis of gonococcal arthritis (ICD-10-CM diagnosis code A54.42) in MS-DRG 489, with an average length of stay of 8 days and average costs of $10,810.

Upon review of the data, we noted that the average costs and average length of stay for cases reporting a principal diagnosis of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) in MS-DRG 488 are higher than the average costs and average length of stay for all cases in MS-DRG 488. We found similar results for MS-DRG 489 for the cases reporting diagnosis code M00.9 or A54.42 as the principal diagnosis.

As stated earlier, the requestor recommended that ICD-10-CM diagnosis codes M00.9 and A54.42 be added to the list of principal diagnoses in MS-DRGs 485, 486, and 487 to recognize knee procedures that are performed with a principal diagnosis of an infectious type of arthritis. Because these diagnosis codes are not specific to the knee in the code description, we Start Printed Page 19195examined the ICD-10-CM Alphabetic Index to review the entries that refer and correspond to these diagnosis codes. Specifically, we searched the Index for codes M00.9 and A54.42 and found the following entries.

Our clinical advisors agreed that the results of our ICD-10-CM Alphabetic Index review combined with the data analysis results support the addition of ICD-10-CM diagnosis code M00.9 to the list of principal diagnoses of infection for MS-DRGs 485, 486, and 487. The entries for diagnosis code M00.9 include infection of the knee, and as discussed above, in our data analysis, we found cases reporting ICD-10-CM diagnosis code M00.9 as a principal diagnosis in MS-DRGs 488 and 489, indicating that knee procedures are, in fact, being performed for an infectious arthritis of the knee. In addition, the average costs for cases reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) in MS-DRG 488 are similar to the average costs of cases in MS-DRG 486 ($16,894 and $16,060, respectively). Because MS-DRG 488 includes cases with a CC or an MCC, we reviewed how many of the 524 cases reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) were reported with a CC or an MCC. We found that there were 361 cases reporting a CC with an average length of stay of 6 days and average costs of $14,092 and 163 cases reporting an MCC with an average length of stay of 9.5 days and average costs of $23,100. Therefore, the cases in MS-DRG 488 reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) with an MCC have average costs that are consistent with the average costs of cases in MS-DRG 485 ($23,100 and $23,980, respectively), and the cases with a CC have average costs that are consistent with the average costs of cases in MS-DRG 486 ($14,092 and $16,060, respectively), as noted above. Start Printed Page 19196We also note that the average length of stay for cases reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) with an MCC in MS-DRG 488 is similar to the average length of stay for cases in MS-DRG 485 (9.5 days and 9.7 days, respectively), and the cases with a CC have an average length of stay that is equivalent to the average length of stay for cases in MS-DRG 486 (6 days and 6 days, respectively). We further note that the average length of stay for cases reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) in MS-DRG 489 is similar to the average length of stay for cases in MS DRG 487 (4.1 days and 4.2 days, respectively). Lastly, the average costs for cases reporting a principal diagnosis code of pyogenic arthritis (ICD-10-CM diagnosis code M00.9) in MS-DRG 489 are consistent with the average costs for cases in MS-DRG 487 ($9,526 and $12,396, respectively), with a difference of $2,870. For these reasons, we are proposing to add ICD-10-CM diagnosis code M00.9 to the list of principal diagnosis codes for MS-DRGs 485, 486, and 487.

Our clinical advisors did not support the addition of ICD-10-CM diagnosis code A54.42 to the list of principal diagnosis codes for MS-DRGs 485, 486, and 487 because ICD-10-CM diagnosis code A54.42 is not specifically indexed to include the knee or any infection in the knee. Therefore, we are not proposing to add ICD-10-CM diagnosis code A54.42 to the list of principal diagnosis codes for these MS-DRGs.

Upon review of the existing list of principal diagnosis codes for MS-DRGs 485, 486, and 487, our clinical advisors recommended that we review the following ICD-10-CM diagnosis codes currently included on the list of principal diagnosis codes because the codes are not specific to the knee.

ICD-10-CM codeCode description
M86.9Osteomyelitis, unspecified.
T84.50XAInfection and inflammatory reaction due to unspecified internal joint prosthesis, initial encounter.
T84.51XAInfection and inflammatory reaction due to internal right hip prosthesis, initial encounter.
T84.52XAInfection and inflammatory reaction due to internal left hip prosthesis, initial encounter.
T84.59XAInfection and inflammatory reaction due to other internal joint prosthesis, initial encounter.
T84.60XAInfection and inflammatory reaction due to internal fixation device of unspecified site, initial encounter.
T84.63XAInfection and inflammatory reaction due to internal fixation device of spine, initial encounter.
T84.69XAInfection and inflammatory reaction due to internal fixation device of other site, initial encounter.

These ICD-10-CM diagnosis codes are currently assigned to medical MS-DRGs 559, 560, and 561 (Aftercare, Musculoskeletal System and Connective Tissue with MCC, with CC, and without CC/MCC, respectively) within MDC 8 in the absence of a surgical procedure. Similar to the process described above, we examined the ICD-10-CM Alphabetic Index to review the entries that refer and correspond to the diagnosis codes shown in the table above. We found the following entries.

Index entries referring to M86.9: Osteomyelitis (general) (infective) (localized) (neonatal) (purulent) (septic) (staphylococcal) (streptococcal) (suppurative) (with periostitis).
Index entries referring to T84.50XA:Complication(s) (from) (of) > joint prosthesis, internal > infection or inflammation Infection, infected, infective (opportunistic) > joint NEC > due to internal joint prosthesis.
Index entries referring to T84.51XA: Infection, infected, infective (opportunistic) > hip (joint) NEC > due to internal joint prosthesis > right.
Index entries referring to T84.52XA: Infection, infected, infective (opportunistic) > hip (joint) NEC > due to internal joint prosthesis > left.
Index entries referring to T84.59XA: Complication(s) (from) (of) > joint prosthesis, internal > infection or inflammation > specified joint NEC Infection, infected, infective (opportunistic) > shoulder (joint) NEC > due to internal joint prosthesis.
Index entries referring to T84.60XA: Complication(s) (from) (of) > fixation device, internal (orthopedic) > infection and inflammation.
Index entries referring to T84.63XA: Complication(s) (from) (of) > fixation device, internal (orthopedic) > infection and inflammation > spine.
Index entries referring to T84.69XA: Complication(s) (from) (of) > fixation device, internal (orthopedic) > infection and inflammation > specified site NEC.

The Index entries for the ICD-10-CM diagnosis codes listed above reflect terms relating to an infection. However, none of the entries is specific to the knee. In addition, we note that there are other diagnosis codes in the subcategory T84.5- series (Infection and inflammatory reaction due to internal joint prosthesis) that are specific to the knee. For example, ICD-10-CM diagnosis code T84.53X- (Infection and inflammatory reaction due to internal right knee prosthesis) or ICD-10-CM diagnosis code T84.54X- (Infection and inflammatory reaction due to internal left knee prosthesis) with the appropriate 7th digit character to identify initial encounter, subsequent encounter or sequela, would be reported to identify a documented infection of the right or left knee due to an internal prosthesis. We further note that these ICD-10-CM diagnosis codes (T84.53X- and T84.54X-) with the 7th character “A” for initial encounter are currently already in the list of principal diagnosis codes for MS-DRGs 485, 486, and 487.

Our clinical advisors support the removal of the above ICD-10-CM diagnosis codes from the list of principal diagnosis codes for MS-DRGs 485, 486, and 487 because they are not specifically indexed to include an infection of the knee and there are other diagnosis codes in the subcategory T84.5- series that uniquely identify an infection and inflammatory reaction of the right or left knee due to an internal prosthesis as noted above.

We also analyzed claims data for MS-DRGs 485, 486 and 487 to identify cases reporting one of the above listed ICD-10-CM diagnosis codes not specific to the knee as a principal diagnosis. Our findings are shown in the following table.Start Printed Page 19197

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 485—Cases reporting principal diagnosis code not specific to the knee1311.2$30,765
MS-DRG 486—Cases reporting principal diagnosis code not specific to the knee436.515,837
MS-DRG 487—Cases reporting principal diagnosis code not specific to the knee72.611,362

For MS-DRG 485, we found 13 cases reporting one of the diagnosis codes not specific to the knee as a principal diagnosis with an average length of stay of 11.2 days and average costs of $30,765. For MS-DRG 486, we found 43 cases reporting one of the diagnosis codes not specific to the knee as a principal diagnosis with an average length of stay of 6.5 days and average costs of $15,837. For MS-DRG 487, we found 7 cases reporting one of the diagnosis codes not specific to the knee as a principal diagnosis with an average length of stay of 2.6 days and average costs of $11,362.

Overall, for MS-DRGs 485, 486, and 487, there were a total of 63 cases reporting one of the ICD-10-CM diagnosis codes not specific to the knee as a principal diagnosis with an average length of stay of 7 days and average costs of $18,421. Of those 63 cases, there were 32 cases reporting a principal diagnosis code from the ICD-10-CM subcategory T84.5-series (Infection and inflammatory reaction due to internal joint prosthesis); 23 cases reporting a principal diagnosis code from the ICD-10-CM subcategory T84.6-series (Infection and inflammatory reaction due to internal fixation device), with 22 of the 23 cases reporting ICD-10-CM diagnosis code T84.69XA (Infection and inflammatory reaction due to internal fixation device of other site, initial encounter) and 1 case reporting ICD-10-CM diagnosis code T84.63XA (Infection and inflammatory reaction due to internal fixation device of spine, initial encounter); and 8 cases reporting ICD-10-CM diagnosis code M86.9 (Osteomyelitis, unspecified) as a principal diagnosis.

Our clinical advisors believe that there may have been coding errors among the 63 cases reporting a principal diagnosis of infection not specific to the knee. For example, 32 cases reported a principal diagnosis code from the ICD-10-CM subcategory T84.5-series (Infection and inflammatory reaction due to internal joint prosthesis) that was not specific to the knee and, as stated previously, there are other codes in this subcategory that uniquely identify an infection and inflammatory reaction of the right or left knee due to an internal prosthesis.

Based on the results of our claims analysis and input from our clinical advisors, we are proposing to remove the following ICD-10-CM diagnosis codes that do not describe an infection of the knee from the list of principal diagnosis codes for MS-DRGs 485, 486, and 487: M86.9; T84.50XA; T84.51XA; T84.52XA; T84.59XA; T84.60XA; T84.63XA; and T84.69XA. We are not proposing to change the current assignment of these diagnosis codes in MS-DRGs 559, 560, and 561.

In addition, our clinical advisors recommended that we add the following ICD-10-CM diagnosis codes as principal diagnosis codes for MS-DRGs 485, 486, and 487 because they are specific to the knee and describe an infection.

ICD-10-CM codeCode description
A18.02Tuberculous arthritis of other joints.
M01.X61Direct infection of right knee in infectious and parasitic diseases classified elsewhere.
M01.X62Direct infection of left knee in infectious and parasitic diseases classified elsewhere.
M01.X69Direct infection of unspecified knee in infectious and parasitic diseases classified elsewhere.
M71.061Abscess of bursa, right knee.
M71.062Abscess of bursa, left knee.
M71.069Abscess of bursa, unspecified knee.
M71.161Other infective bursitis, right knee.
M71.162Other infective bursitis, left knee.
M71.169Other infective bursitis, unspecified knee.

ICD-10-CM diagnosis code A18.02 (Tuberculous arthritis of other joints) is currently assigned to medical MS-DRGs 548, 549, and 550 (Septic Arthritis with MCC, with CC, and without CC/MCC, respectively) within MDC 8 and MS-DRGs 974, 975, and 976 (HIV with Major Related Condition with MCC, with CC, and without CC/MCC, respectively) within MDC 25 (Human Immunodeficiency Virus Infections) in the absence of a surgical procedure. ICD-10-CM diagnosis codes M01.X61 (Direct infection of right knee in infectious and parasitic diseases classified elsewhere), M01.X62 (Direct infection of left knee in infectious and parasitic diseases classified elsewhere), and M01.X69 (Direct infection of unspecified knee in infectious and parasitic diseases classified elsewhere) are currently assigned to medical MS-DRGs 548, 549, and 550 (Septic Arthritis with MCC, with CC, and without CC/MCC, respectively) within MDC 8 in the absence of a surgical procedure. ICD-10-CM diagnosis codes M71.061 (Abscess of bursa, right knee), M71.062 (Abscess of bursa, left knee), M71.069 (Abscess of bursa, unspecified knee), M71.161 (Other infective bursitis, right knee), M71.162 (Other infective bursitis, left knee), and M71.169 (Other infective bursitis, unspecified knee) are currently assigned to medical MS-DRGs 557 and 558 (Tendonitis, Myositis and Bursitis with and without MCC, respectively) within MDC 8 in the absence of a surgical procedure.

Similar to the process described above, we examined the ICD-10-CM Alphabetic Index to review the entries that refer and correspond to the diagnosis codes shown in the table above. We found the following entries.

Start Printed Page 19198

Start Printed Page 19199

Start Printed Page 19200

We note that there were no Index entries specifically for ICD-10-CM diagnosis codes M71.061, M71.062, M71.069, M71.161, M71.162, and M71.169. Rather, there were Index entries at the subcategory levels of M71.06- and M71.16-. We found the following entries.Start Printed Page 19201

Index entry referring to M71.06-: (connective tissue) (embolic) (fistulous) (infective) (metastatic) (multiple) (pernicious) (pyogenic) (septic) > bursa > knee.
Index entry referring to M71.16-: Infective NEC > knee.

Our clinical advisors agreed that the results of our review of the ICD-10-CM Alphabetic Index support the addition of these ICD-10-CM diagnosis codes to MS-DRGs 485, 486, and 487 because the Index entries and/or the code descriptions clearly describe or include an infection that is specific to the knee.

Therefore, we are proposing to add the following ICD-10-CM diagnosis codes to the list of principal diagnosis codes for MS-DRGs 485, 486, and 487: A18.02; M01.X61; M01.X62; M01.X69; M71.061; M71.062; M71.069; M71.161; M71.162; and M71.169.

b. Neuromuscular Scoliosis

We received a request to add ICD-10-CM diagnosis codes describing neuromuscular scoliosis to the list of principal diagnosis codes for MS-DRGs 456, 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, respectively). Excluding the ICD-10-CM diagnosis codes that address the cervical spine, the following ICD-10-CM diagnosis codes are used to describe neuromuscular scoliosis.

ICD-10-CM codeCode description
M41.40Neuromuscular scoliosis, site unspecified.
M41.44Neuromuscular scoliosis, thoracic region.
M41.45Neuromuscular scoliosis, thoracolumbar region.
M41.46Neuromuscular scoliosis, lumbar region.
M41.47Neuromuscular scoliosis, lumbosacral region.

The requestor asserted that all levels of neuromuscular scoliosis, except cervical, should group to the non-cervical spinal fusion MS-DRGs for spinal curvature (MS-DRGs 456, 457, and 458). The requestor also noted that the current MS-DRG logic only groups cases reporting neuromuscular scoliosis to MS-DRGs 456, 457, and 458 when neuromuscular scoliosis is reported as a secondary diagnosis. The requestor contended that it would be rare for a diagnosis of neuromuscular scoliosis to be reported as a secondary diagnosis because there is not a “code first” note in the ICD-10-CM Tabular List of Diseases and Injuries indicating to “code first” the underlying cause. According to the requestor, when a diagnosis of neuromuscular scoliosis is the reason for an admission for non-cervical spinal fusion, neuromuscular scoliosis must be sequenced as the principal diagnosis because it is the chief condition responsible for the admission. However, this sequencing, which adheres to the ICD-10-CM Official Guidelines for Coding and Reporting, prevents the admission from grouping to the non-cervical spinal fusion MS-DRGs for spinal curvature caused by neuromuscular scoliosis.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting any of the ICD-10-CM diagnosis codes describing neuromuscular scoliosis (as listed previously) as a principal diagnosis with a non-cervical spinal fusion, which are currently assigned to MS-DRGs 459 and 460 (Spinal Fusion except Cervical with MCC and without MCC, respectively). Our findings are shown in the following table.

MS-DRGs for Cases Involving Non-Cervical Spinal Fusion With Principal Diagnosis of Neuromuscular Scoliosis

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 459—All cases3,9038.6$46,416
MS-DRG 459—Cases with principal diagnosis of neuromuscular scoliosis315.395,745
MS-DRG 460—All cases52,5973.328,754
MS-DRG 460—Cases with principal diagnosis of neuromuscular scoliosis84.371,406

The data reveal that there was a total of 56,500 cases in MS-DRGs 459 and 460. We found 3,903 cases reported in MS-DRG 459, with an average length of stay of 8.6 days and average costs of $46,416. Of these 3,903 cases, 3 reported a principal diagnosis code of neuromuscular scoliosis, with an average length of stay of 15.3 days and average costs of $95,745. We found a total of 52,597 cases in MS-DRG 460, with an average length of stay of 3.3 days and average costs of $28,754. Of these 52,597 cases, 8 cases reported a principal diagnosis code describing neuromuscular scoliosis, with an average length of stay of 4.3 days and average costs of $71,406. The data clearly demonstrate that the average costs and average length of stay for the small number of cases reporting a principal diagnosis of neuromuscular scoliosis are higher in comparison to all the cases in their assigned MS-DRG.

We also analyzed claims data for MS-DRGs 456, 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, respectively) to identify the spinal fusion cases reporting any of the ICD-10-CM codes describing neuromuscular scoliosis (as listed previously) as a secondary diagnosis. Our findings are shown in the following table.Start Printed Page 19202

MS-DRGs for Cases Involving Non-Cervical Spinal Fusion With Spinal Curvature or Malignancy or Infection or Extensive Fusions With Secondary Diagnosis of Neuromuscular Scoliosis

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 456—All cases1,34412.0$66,012
MS-DRG 456—Cases with secondary diagnosis of neuromuscular scoliosis618.279,809
MS-DRG 457—All cases3,6546.247,577
MS-DRG 457—Cases with secondary diagnosis of neuromuscular scoliosis124.531,646
MS-DRG 458—All cases1,2453.434,179
MS-DRG 458—Cases with secondary diagnosis of neuromuscular scoliosis63.331,117

The data indicate that there were 1,344 cases reported in MS-DRG 456, with an average length of stay of 12 days and average costs of $66,012. Of these 1,344 cases, 6 cases reported a secondary diagnosis code describing neuromuscular scoliosis, with an average length of stay of 18.2 days and average costs of $79,809. We found a total of 3,654 cases in MS-DRG 457, with an average length of stay of 6.2 days and average costs of $47,577. Twelve of these 3,654 cases reported a secondary diagnosis code describing neuromuscular scoliosis, with an average length of stay of 4.5 days and average costs of $31,646. Finally, the 1,245 cases reported in MS-DRG 458 had an average length of stay of 3.4 days and average costs of $34,179. Of these 1,245 cases, 6 cases reported neuromuscular scoliosis as a secondary diagnosis, with an average length of stay of 3.3 days and average costs of $31,117.

We reviewed the ICD-10-CM Tabular List of Diseases for subcategory M41.4 and confirmed there is a “Code also underlying condition” note. We also reviewed the ICD-10-CM Official Guidelines for Coding and Reporting for the “code also” note at Section 1.A.12.b., which states: “A `code also' note instructs that two codes may be required to fully describe a condition, but this note does not provide sequencing direction.” Our clinical advisors agree that the sequencing of the ICD-10-CM diagnosis codes is determined by which condition leads to the encounter and is responsible for the admission. They also note that there may be instances in which the underlying cause of the diagnosis of neuromuscular scoliosis is not treated or responsible for the admission.

As discussed earlier, our review of the claims data shows that a small number of cases reported neuromuscular scoliosis either as a principal diagnosis in MS-DRGs 459 and 460 or as a secondary diagnosis in MS-DRGs 456, 457, and 458. Our clinical advisors agree that while the volume of cases is small, the average costs and average length of stay for the cases reporting neuromuscular scoliosis as a principal diagnosis with a non-cervical spinal fusion currently grouping to MS-DRGs 459 and 460 are more aligned with the average costs and average length of stay for the cases reporting neuromuscular scoliosis as a secondary diagnosis with a non-cervical spinal fusion currently grouping to MS-DRGs 456, 457, and 458. Therefore, for the reasons described above, we are proposing to add the following ICD-10-CM codes describing neuromuscular scoliosis to the list of principal diagnosis codes for MS-DRGs 456, 457, and 458: M41.40; M41.44; M41.45; M41.46; and M41.47.

c. Secondary Scoliosis and Secondary Kyphosis

We received a request to add ICD-10-CM diagnosis codes describing secondary scoliosis and secondary kyphosis to the list of principal diagnoses for MS-DRGs 456, 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, respectively). Excluding the ICD-10-CM diagnosis codes that address the cervical spine, the following ICD-10-CM diagnosis codes are used to describe secondary scoliosis.

ICD-10-CM codeCode description
M41.50Other secondary scoliosis, site unspecified.
M41.54Other secondary scoliosis, thoracic region.
M41.55Other secondary scoliosis, thoracolumbar region.
M41.56Other secondary scoliosis, lumbar region.
M41.57Other secondary scoliosis, lumbosacral region.

Excluding the ICD-10-CM diagnosis codes that address the cervical spine, the following ICD-10-CM diagnosis codes are used to describe secondary kyphosis.

ICD-10-CM codeCode description
M40.10Other secondary kyphosis, site unspecified.
M40.14Other secondary kyphosis, thoracic region.
M40.15Other secondary kyphosis, thoracolumbar region.

The requestor stated that generally in cases of diagnoses of secondary scoliosis or kyphosis, the underlying cause of the condition is not treated or is not responsible for the admission. If a patient is admitted for surgery to correct non-cervical spinal curvature, it is appropriate to sequence the diagnosis of secondary scoliosis or secondary kyphosis as principal diagnosis. However, reporting a diagnosis of secondary scoliosis or secondary Start Printed Page 19203kyphosis as the principal diagnosis with a non-cervical spinal fusion procedure results in the case grouping to MS-DRG 459 or 460 (Spinal Fusion except Cervical with MCC and without MCC, respectively), instead of the spinal fusion with spinal curvature MS-DRGs 456, 457, and 458.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 459 and 460 to determine the number of cases reporting an ICD-10-CM diagnosis code describing secondary scoliosis or secondary kyphosis as the principal diagnosis. Our findings are shown in the following table.

MS-DRGs for Cases Involving Non-Cervical Spinal Fusion With a Principal Diagnosis of Secondary Scoliosis or Secondary Kyphosis

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 459—All cases3,9038.6$46,416
MS-DRG 459—Cases with a principal diagnosis of secondary scoliosis47.356,024
MS-DRG 459—Cases with a principal diagnosis of secondary kyphosis45.841,883
MS-DRG 460—All cases52,5973.328,754
MS-DRG 460—Cases with a principal diagnosis of secondary scoliosis343.634,424
MS-DRG 460—Cases with a principal diagnosis of secondary kyphosis314.642,315

As shown in the table, we found a total of 3,903 cases in MS-DRG 459, with an average length of stay of 8.6 days and average costs of $46,416. Of these 3,903 cases, we found 4 cases that reported a principal diagnosis of secondary scoliosis, with an average length of stay of 7.3 days and average costs of $56,024. We also found 4 cases that reported a principal diagnosis of secondary kyphosis, with an average length of stay of 5.8 days and average costs of $41,883. For MS-DRG 460, we found a total of 52,597 cases with an average length of stay of 3.3 days and average costs of $28,754. Of these 52,597 cases, we found 34 cases that reported a principal diagnosis of secondary scoliosis, with an average length of stay of 3.6 days and average costs of $34,424. We found 31 cases that reported a principal diagnosis of secondary kyphosis in MS-DRG 460, with an average length of stay of 4.6 days and average costs of $42,315.

We also analyzed claims data for MS-DRGs 456, 457, and 458 to determine the number of cases reporting an ICD-10-CM diagnosis code describing secondary scoliosis or secondary kyphosis as a secondary diagnosis. Our findings are shown in the following table.

MS-DRGs for Cases Involving Non-Cervical Spinal Fusion With Spinal Curvature or Malignancy or Infection or Extensive Fusions With Secondary Diagnosis of Secondary Scoliosis or Secondary Kyphosis

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 456—All cases1,34412$66,012
MS-DRG 456—Cases with a secondary diagnosis of secondary scoliosis377.758,009
MS-DRG 456—Cases with a secondary diagnosis of secondary kyphosis521278,865
MS-DRG 457—All cases3,6546.247,577
MS-DRG 457—Cases with a secondary diagnosis of secondary scoliosis1874.937,655
MS-DRG 457—Cases with a secondary diagnosis of secondary kyphosis1145.237,357
MS-DRG 458—All cases1,2453.434,179
MS-DRG 458—Cases with a secondary diagnosis of secondary scoliosis1903.029,052
MS-DRG 458—Cases with a secondary diagnosis of secondary kyphosis393.731,015

The data indicate that there were 1,344 cases in MS-DRG 456, with an average length of stay of 12 days and average costs of $66,012. Of these 1,344 cases, there were 37 cases that reported a secondary diagnosis of secondary scoliosis, with an average length of stay of 7.7 days and average costs of $58,009. There were also 52 cases in MS-DRG 456 reporting a secondary diagnosis of secondary kyphosis, with an average length of stay of 12 days and average costs of $78,865. In MS-DRG 457, there was a total of 3,654 cases, with an average length of stay of 6.2 days and average costs of $47,577. Of these 3,654 cases, there were 187 cases that reported secondary scoliosis as a secondary diagnosis, with an average length of stay of 4.9 days and average costs of $37,655. In MS-DRG 457, there were also 114 cases that reported a secondary diagnosis of secondary kyphosis, with an average length of stay of 5.2 days and average costs of $37,357. Finally, there was a total of 1,245 cases in MS-DRG 458, with an average length of stay of 3.4 days and average costs of $34,179. Of these 1,245 cases, there were 190 cases that reported a secondary diagnosis of secondary scoliosis, with an average length of stay of 3 days and average costs of $29,052. There were 39 cases in MS-DRG 458 that reported a secondary diagnosis of secondary kyphosis, with an average length of stay of 3.7 days and average costs of $31,015.

Our clinical advisors agree that the average length of stay and average costs for the small number of cases reporting secondary scoliosis or secondary kyphosis as a principal diagnosis with a non-cervical spinal fusion currently grouping to MS-DRGs 459 and 460 are generally more aligned with the average length of stay and average costs for the cases reporting secondary scoliosis or secondary kyphosis as a secondary diagnosis with a non-cervical spinal fusion currently grouping to MS-DRGs 456, 457, and 458. They also note that there may be instances in which the underlying cause of the diagnosis of secondary scoliosis or secondary kyphosis is not treated or responsible for the admission.

Therefore, for the reasons described above, we are proposing to add the following ICD-10-CM diagnosis codes describing secondary scoliosis and Start Printed Page 19204secondary kyphosis to the list of principal diagnosis codes for MS-DRGs 456, 457, and 458: M40.10; M40.14; M40.15; M41.50; M41.54; M41.55; M41.56; and M41.57. During our review of MS-DRGs 456, 457, and 458, we found the following diagnosis codes that describe conditions involving the cervical region.

ICD-10-CM codeCode description
M40.03Postural kyphosis, cervicothoracic region.
M40.202Unspecified kyphosis, cervical region.
M40.203Unspecified kyphosis, cervicothoracic region.
M40.292Other kyphosis, cervical region.
M40.293Other kyphosis, cervicothoracic region.
M41.02Infantile idiopathic scoliosis, cervical region.
M41.03Infantile idiopathic scoliosis, cervicothoracic region.
M41.112Juvenile idiopathic scoliosis, cervical region.
M41.113Juvenile idiopathic scoliosis, cervicothoracic region.
M41.122Adolescent idiopathic scoliosis, cervical region.
M41.123Adolescent idiopathic scoliosis, cervicothoracic region.
M41.22Other idiopathic scoliosis, cervical region.
M41.23Other idiopathic scoliosis, cervicothoracic region.
M41.82Other forms of scoliosis, cervical region.
M41.83Other forms of scoliosis, cervicothoracic region.
M42.01Juvenile osteochondrosis of spine, occipito-atlanto-axial region.
M42.02Juvenile osteochondrosis of spine, cervical region.
M42.03Juvenile osteochondrosis of spine, cervicothoracic region.
M43.8X1Other specified deforming dorsopathies, occipito-atlanto-axial region.
M43.8X2Other specified deforming dorsopathies, cervical region.
M43.8X3Other specified deforming dorsopathies, cervicothoracic region.
M46.21Osteomyelitis of vertebra, occipito-atlanto-axial region.
M46.22Osteomyelitis of vertebra, cervical region.
M46.23Osteomyelitis of vertebra, cervicothoracic region.
M48.51XACollapsed vertebra, not elsewhere classified, occipito-atlanto-axial region, initial encounter for fracture.
M48.52XACollapsed vertebra, not elsewhere classified, cervical region, initial encounter for fracture.
M48.53XACollapsed vertebra, not elsewhere classified, cervicothoracic region, initial encounter for fracture.
M40.12Other secondary kyphosis, cervical region.
M40.13Other secondary kyphosis, cervicothoracic region.
M41.41Neuromuscular scoliosis, occipito-atlanto-axial region.
M4.142Neuromuscular scoliosis, cervical region.
M4143Neuromuscular scoliosis, cervicothoracic region.
M41.52Other secondary scoliosis, cervical region.
M41.53Other secondary scoliosis, cervicothoracic region.

Our clinical advisors noted that because the diagnosis codes shown in the table above describe conditions involving the cervical region, they are not clinically appropriate for assignment to MS-DRGs 456, 457, and 458, which are defined by non-cervical spinal fusion procedures (with spinal curvature or malignancy or infection or extensive fusions). Therefore, our clinical advisors recommended that these codes be removed from the MS-DRG logic for these MS-DRGs. As such, we are proposing to remove the diagnosis codes that describe conditions involving the cervical region as shown in the table above from MS-DRGs 456, 457, and 458.

7. MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract): Extracorporeal Shock Wave Lithotripsy (ESWL)

We received two separate, but related requests to add ICD-10-CM diagnosis code N13.6 (Pyonephrosis) and ICD-10-CM diagnosis code T83.192A (Other mechanical complication of indwelling ureteral stent, initial encounter) to the list of principal diagnosis codes for MS-DRGs 691 and 692 (Urinary Stones with ESW Lithotripsy with CC/MCC and without CC/MCC, respectively) in MDC 11 so that cases are assigned more appropriately when an Extracorporeal Shock Wave Lithotripsy (ESWL) procedure is performed.

ICD-10-CM diagnosis code N13.6 currently groups to MS-DRGs 689 and 690 (Kidney and Urinary Tract Infections with MCC and without MCC, respectively) and ICD-10-CM diagnosis code T83.192A currently groups to MS-DRGs 698, 699, and 700 (Other Kidney and Urinary Tract Diagnoses with MCC, with CC, and without CC/MCC, respectively).

The ICD-10-PCS procedure codes for identifying procedures involving ESWL are designated as non-O.R. procedures and are shown in the following table.

ICD-10-PCS codeCode description
0TF3XZZFragmentation in right kidney pelvis, external approach.
0TF4XZZFragmentation in left kidney pelvis, external approach.
OTF6XZZFragmentation in right ureter, external approach.
OTF7XZZFragmentation in left ureter, external approach.
OTFBXZZFragmentation in bladder, external approach.
OTFCXZZFragmentation in bladder neck, external approach.
OTFDXZZFragmentation in urethra, external approach.
Start Printed Page 19205

Pyonephrosis can be described as an infection of the kidney with pus in the upper collecting system which can progress to obstruction. Patients with an obstruction in the upper urinary tract due to urinary stones (calculi), tumors, fungus balls or ureteropelvic obstruction (UPJ) may also have a higher risk of developing pyonephrosis. If pyonephrosis is not recognized and treated promptly, it can result in serious complications, including fistulas, septic shock, irreversible damage to the kidneys, and death.

As noted above, the requestor recommended that ICD-10-CM diagnosis codes N13.6 and T83.192A be added to the list of principal diagnosis codes for MS-DRGs 691 and 692. There are currently four MS-DRGs that group cases for diagnoses involving urinary stones, which are subdivided to identify cases with and without an ESWL procedure: MS-DRGs 691 and 692 (Urinary Stones with ESW Lithotripsy with and without CC/MCC, respectively) and MS-DRGs 693 and 694 (Urinary Stones without ESW Lithotripsy with and without MCC, respectively).

The requestor stated that when patients who have been diagnosed with hydronephrosis secondary to renal and ureteral calculus obstruction undergo an ESWL procedure, ICD-10-CM diagnosis code N13.2 (Hydronephrosis with renal and ureteral calculous obstruction) is reported and groups to MS-DRGs 691 and 692. However, if a patient with a diagnosis of hydronephrosis has a urinary tract infection (UTI) in addition to a renal calculus obstruction and undergoes an ESWL procedure, ICD-10-CM diagnosis code N13.6 must be coded and reported as the principal diagnosis, which groups to MS-DRGs 689 and 690. The requestor stated that ICD-10-CM diagnosis code N13.6 should be grouped to MS-DRGs 691 and 692 when reported as a principal diagnosis because this grouping will more appropriately reflect resource consumption for patients who undergo an ESWL procedure for obstructive urinary calculi, while also receiving treatment for urinary tract infections.

With regard to ICD-10-CM diagnosis code T83.192A, the requestor believed that when an ESWL procedure is performed for the treatment of calcifications within and around an indwelling ureteral stent, it is comparable to an ESWL procedure performed for the treatment of urinary calculi. Therefore, the requestor recommended adding ICD-10-CM diagnosis code T83.192A to MS-DRGs 691 and 692 when reported as a principal diagnosis and an ESWL procedure is also reported on the claim.

To analyze these separate, but related requests, we first reviewed the reporting of ICD-10-CM diagnosis code N13.6 within the ICD-10-CM classification. ICD-10-CM diagnosis code N13.6 is to be assigned for conditions identified in the code range N13.0-N13.5 with infection. (Codes in this range describe hydronephrosis with obstruction.) Infection may be documented by the patient's provider as urinary tract infection (UTI) or as specific as acute pyelonephritis. We agree with the requestor that if a patient with a diagnosis of hydronephrosis has a urinary tract infection (UTI) in addition to a renal calculus obstruction and undergoes an ESWL procedure, ICD-10-CM diagnosis code N13.6 must be coded and reported as the principal diagnosis, which groups to MS-DRGs 689 and 690. In this case scenario, the ESWL procedure is designated as a non-O.R. procedure and does not impact the MS-DRG assignment when reported with ICD-10-CM diagnosis code N13.6.

The ICD-10-CM classification instructs that when both a urinary obstruction and a genitourinary infection co-exist, the correct code assignment for reporting is ICD-10-CM diagnosis code N13.6, which is appropriately grouped to MS-DRGs 689 and 690 (Kidney and Urinary Tract Infections with MCC and without MCC, respectively) because it describes a type of urinary tract infection. Therefore, in response to the requestor's suggestion that ICD-10-CM diagnosis code N13.6 be grouped to MS-DRGs 691 and 692 when reported as a principal diagnosis to more appropriately reflect resource consumption for patients who undergo an ESWL procedure for obstructive urinary calculi while also receiving treatment for urinary tract infections, we note that the ICD-10-CM classification provides instruction to identify the conditions reported with ICD-10-CM diagnosis code N13.6 as an infection, and not as urinary stones. Our clinical advisors agree with this classification and the corresponding MS-DRG assignment for diagnosis code N13.6. In addition, our clinical advisors noted that an ESWL procedure is a non-O.R. procedure and they do not believe that this procedure is a valid indicator of resource consumption for cases that involve an infection and obstruction. Our clinical advisors believe that the resources used for a case that involves an infection and an obstruction are clinically distinct from the cases that involve an obstruction only in the course of treatment. Therefore, our clinical advisors do not agree with the request to add ICD-10-CM diagnosis code N13.6 to the list of principal diagnoses for MS-DRGs 691 and 692.

We also performed various analyses of claims data to evaluate this request. We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 689 and 690 to identify cases reporting ICD-10-CM diagnosis code N13.6 as the principal diagnosis with and without an ESWL procedure. Our findings are reflected in the table below.

Kidney and Urinary Tract Infections With Principal Diagnosis of Pyonephrosis With and Without ESWL

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 689—All cases68,0204.8$7,873
MS-DRG 689—Cases with principal diagnosis of pyonephrosis1,0246.113,809
MS-DRG 689—Cases with principal diagnosis of pyonephrosis with ESWL614.245,489
MS-DRG 690—All cases131,9993.55,692
MS-DRG 690—Cases with principal diagnosis of pyonephrosis4,6253.65,483
MS-DRG 690—Cases with principal diagnosis of pyonephrosis with ESWL244.814,837

For MS-DRG 689, we found a total of 68,020 cases with an average length of stay of 4.8 days and average costs of $7,873. Of those 68,020 cases, we found 1,024 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis with an average length of stay of 6.1 days and average costs of $13,809. Of those 1,024 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis, there were 6 cases that also reported an ESWL procedure with an average length of stay of 14.2 days and average costs of $45,489. For MS-DRG Start Printed Page 19206690, we found a total of 131,999 cases with an average length of stay of 3.5 days and average costs of $5,692. Of those 131,999 cases, we found 4,625 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis with an average length of stay of 3.6 days and average costs of $5,483. Of those 4,625 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis, there were 24 cases that also reported an ESWL procedure with an average length of stay of 4.8 days and average costs of $14,837.

The data indicate that the 1,024 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis in MS-DRG 689 have a longer average length of stay (6.1 days versus 4.8 days) and higher average costs ($13,809 versus $7,873) compared to all the cases in MS-DRG 689. The data also indicate that the 6 cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis that also reported an ESWL procedure have a longer average length of stay (14.2 days versus 4.8 days) and higher average costs ($45,489 versus $7,873) in comparison to all the cases in MS-DRG 689. We found similar results for cases reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a principal diagnosis with an ESWL procedure in MS-DRG 690, where the average length of stay was slightly longer (4.8 days versus 3.5 days) and the average costs were higher ($14,837 versus $5,692).

We then conducted further analysis for the six cases in MS-DRG 689 that reported a principal diagnosis of pyonephrosis with ESWL to determine what factors may be contributing to the longer lengths of stay and higher average costs. Specifically, we analyzed the MCC conditions that were reported across the six cases. Our findings are shown in the table below.

Secondary Diagnosis MCC Conditions Reported in MS-DRG 689 With Principal Diagnosis of Pyonephrosis with ESWL

ICD-10-CM codeDescriptionNumber of times reportedAverage length of stayAverage costs
A41.9Sepsis, unspecified organism226.596,525
G82.50Quadriplegia, unspecified1713,782
I50.23Acute on chronic systolic (congestive) heart failure1713,304
J96. 01Acute respiratory failure with hypoxia1713,304
K66.1Hemoperitoneum11026,314
L89.153Pressure ulcer of sacral region, stage 31826,487
R57.1Hypovolemic shock11026,314
Total812.839,069

We found seven secondary diagnosis MCC conditions reported among the six cases in MS-DRG 689 that had a principal diagnosis of pyonephrosis with ESWL. These MCC conditions appear to have contributed to the longer lengths of stay and higher average costs for those six cases. As shown in the table above, the overall average length of stay for the cases reporting these conditions is 12.8 days with average costs of $39,069, which is consistent with the average length of stay of 14.2 days and average costs of $45,489 for the cases in MS-DRG 689 that had a principal diagnosis of pyonephrosis with ESWL.

We then analyzed the 24 cases in MS-DRG 690 that reported a principal diagnosis of pyonephrosis with ESWL to determine what factors may be contributing to the longer lengths of stay and higher average costs. Specifically, we analyzed the CC conditions that were reported across the 24 cases. Our findings are shown in the table below.

Secondary Diagnosis CC Conditions Reported in MS-DRG 690 With Principal Diagnosis of Pyonephrosis With ESWL

ICD-10-CM codeDescriptionNumber of times reportedAverage length of stayAverage costs
B37.0Candidal stomatitis29.5$18,895
B37.49Other urogenital candidiasis27.530,458
C79.89Secondary malignant neoplasm of other specified sites135,882
E22.2Syndrome of inappropriate secretion of antidiuretic hormone125,979
E44.0Moderate protein-calorie malnutrition169,027
E46Unspecified protein-calorie malnutrition25.58,704
E87.0Hyperosmolality and hypernatremia169,027
E87.1Hypo-osmolality and hyponatremia1512,339
F11.20Opioid dependence, uncomplicated118,209
F33.1Major depressive disorder, recurrent, moderate11255,034
G81.94Hemiplegia, unspecified affecting left nondominant side39.325,390
G82.20Paraplegia, unspecified11015,142
G93.40Encephalopathy, unspecified2710,277
I13.0Hypertensive heart and chronic kidney disease with heart failure and stage 1 through stage 4 chronic kidney disease, or unspecified chronic kidney dis1412,348
I48.1Persistent atrial fibrillation11255,034
I50.22Chronic systolic (congestive) heart failure11255,034
I50.32Chronic diastolic (congestive) heart failure23.59,115
I69.351Hemiplegia and hemiparesis following cerebral infarction affecting right dominant side134,845
Start Printed Page 19207
I69.859Hemiplegia and hemiparesis following other cerebrovascular disease affecting unspecified side1418,160
I97.791Other intraoperative cardiac functional disturbances during other surgery188,114
J44.0Chronic obstructive pulmonary disease with acute lower respiratory infection11125,641
J44.1Chronic obstructive pulmonary disease with (acute) exacerbation2511,283
J96.10Chronic respiratory failure, unspecified whether with hypoxia or hypercapnia11255,034
J96.11Chronic respiratory failure with hypoxia2715,243
K57.92Diverticulitis of intestine, part unspecified, without perforation or abscess without bleeding1812,150
N12Tubulo-interstitial nephritis, not specified as acute or chronic11125,641
N13.8Other obstructive and reflux uropathy1532,854
N17.9Acute kidney failure, unspecified1221,329
N20.1Calculus of ureter11015,142
N20.2Calculus of kidney with calculus of ureter169,027
R44.3Hallucinations, unspecified1221,329
R47.01Aphasia1410,161
R78.81Bacteremia1114,849
S37.012AMinor contusion of left kidney, initial encounter1221,329
T83.511AInfection and inflammatory reaction due to indwelling urethral catheter, initial encounter11015,142
Z68.1Body mass index (BMI) 19.9 or less, adult24.510,040
Z68.43Body mass index (BMI) 50-59.9, adult136,145
Total476.618,173

We found 37 secondary diagnosis CC conditions reported among the 24 cases in MS-DRG 690 that had a principal diagnosis of pyonephrosis with ESWL. These CC conditions appear to have contributed to the longer length of stay and higher average costs for those 24 cases. As shown in the table above, the overall average length of stay for the cases reporting these conditions is 6.6 days with average costs of $18,173, which is higher, although comparable, to the average length of stay of 4.8 days and average costs of $14,837 for the cases in MS-DRG 690 that had a principal diagnosis of pyonephrosis with ESWL. We note that it appears that 1 of the 24 cases had at least 4 secondary diagnosis CC conditions (F33.1, I48.1, I50.22, and J96.10) with an average length of stay of 12 days and average costs of $55,034, which we believe contributed greatly overall to the longer length of stay and higher average costs for those secondary diagnosis CC conditions reported among the 24 cases.

Our clinical advisors agree that the resource consumption for the 6 cases in MS-DRG 689 and the 24 cases in MS-DRG 690 that reported a principal diagnosis of pyonephrosis with ESWL cannot be directly attributed to ESWL and believe that it is the secondary diagnosis MCC and CC conditions that are the major contributing factors to the longer average length of stay and higher average costs for these cases.

We also analyzed claims data for MS-DRGs 691 and 692 (Urinary Stones with ESW Lithotripsy with CC/MCC and without CC/MCC, respectively) and MS-DRGs 693 and 694 (Urinary Stones without ESW Lithotripsy with MCC and without MCC, respectively) to identify claims reporting pyonephrosis (ICD-10-CM diagnosis code N13.6) as a secondary diagnosis. Our findings are shown in the following table.

MS-DRGs for Urinary Stones With Secondary Diagnosis of Pyonephrosis With and Without ESWL

MS-DRGNumber of times reportedAverage length of stayAverage costs
MS-DRG 691—All cases1403.9$11,997
MS-DRG 691—Cases with secondary diagnosis of pyonephrosis and ESWL3824,280
MS-DRG 692—All cases1242.18,326
MS-DRG 693—All cases1,3155.19,668
MS-DRG 693—Cases with secondary diagnosis of pyonephrosis165.59,962
MS-DRG 694—All cases7,2402.75,263
MS-DRG 694—Cases with secondary diagnosis of pyonephrosis893.56,678

As shown in the table above, in MS-DRG 691, there was a total of 140 cases with an average length of stay of 3.9 days and average costs of $11,997. Of those 140 cases, there were 3 cases that reported pyonephrosis as a secondary diagnosis and an ESWL procedure with an average length of stay of 8.0 days and average costs of $24,280. There was a total of 124 cases found in MS-DRG 692 with an average length of stay of 2.1 days and average costs of $8,326. There were no cases in MS-DRG 692 that reported pyonephrosis as a secondary diagnosis with an ESWL procedure. For MS-DRG 693, there was a total of 1,315 cases with an average length of stay of 5.1 days and average costs of $9,668. Of Start Printed Page 19208those 1,315 cases, there were 16 cases reporting pyonephrosis as a secondary diagnosis with an average length of stay of 5.5 days and average costs of $9,962. For MS-DRG 694, there was a total of 7,240 cases with an average length of stay of 2.7 days and average costs of $5,263. Of those 7,240 cases, there were 89 cases reporting pyonephrosis as a secondary diagnosis with an average length of stay of 3.5 days and average costs of $6,678.

Similar to the process described above, we then conducted further analysis for the three cases in MS-DRG 691 that reported a secondary diagnosis of pyonephrosis with ESWL to determine what factors may be contributing to the longer lengths of stay and higher average costs. Specifically, we analyzed what other MCC and CC conditions were reported across the three cases. We found no other MCC conditions reported for those three cases. Our findings for the CC conditions reported for those three cases are shown in the table below.

Secondary Diagnosis CC Conditions Reported in MS-DRG 691

ICD-10-CM codeDescriptionNumber of times reportedAverage length of stayAverage costs
E44.0Moderate protein-calorie malnutrition115$52,384
J96.10Chronic respiratory failure, unspecified whether with hypoxia or hypercapnia1715,110
N13.6Pyonephrosis28.528,865
N17.9Acute kidney failure, unspecified125,346
N39.0Urinary tract infection, site not specified125,346
Q79.6Ehlers-Danlos syndrome125,346
Total76.420,181

We found six secondary diagnosis CC conditions reported among the three cases in MS-DRG 691 that had a secondary diagnosis of pyonephrosis with ESWL. These CC conditions appear to have contributed to the longer lengths of stay and higher average costs for those three cases. As shown in the table above, the overall average length of stay for the cases reporting these conditions is 6.4 days with average costs of $20,181, which is more consistent with the average length of stay of 8.0 days and average costs of $24,280 for the cases in MS-DRG 691 that had a secondary diagnosis of pyonephrosis with ESWL.

Our clinical advisors believe that the resource consumption for those three cases cannot be directly attributed to ESWL and that it is the secondary diagnosis CC conditions reported in addition to pyonephrosis, which is also designated as a CC condition, that are the major contributing factors for the longer average lengths of stay and higher average costs for these cases in MS-DRG 691.

We did not conduct further analysis for the 16 cases in MS-DRG 693 or the 89 cases in MS-DRG 694 that reported a secondary diagnosis of pyonephrosis because MS-DRGs 693 and 694 do not include ESWL procedures and the average length of stay and average costs for those cases were consistent with the data findings for all of the cases in their assigned MS-DRG.

As discussed earlier in this section, the requestor suggested that ICD-10-CM diagnosis code N13.6 should be grouped to MS-DRGs 691 and 692 when reported as a principal diagnosis because this grouping will more appropriately reflect resource consumption for patients who undergo an ESWL procedure for obstructive urinary calculi, while also receiving treatment for urinary tract infections. However, based on the results of the data analysis and input from our clinical advisors, we believe that cases for which ICD-10-CM diagnosis code N13.6 was reported as a principal diagnosis or as a secondary diagnosis with an ESWL procedure should not be utilized as an indicator for increased utilization of resources based on the performance of an ESWL procedure. Rather, we believe that the resource consumption is more likely the result of secondary diagnosis CC and/or MCC diagnosis codes.

With respect to the requestor's concern that cases reporting ICD-10-CM diagnosis code T83.192A (Other mechanical complication of indwelling ureteral stent, initial encounter) and an ESWL procedure are not appropriately assigned and should be added to the list of principal diagnoses for MS-DRGs 691 and 692 (Urinary Stones with ESW Lithotripsy with CC/MCC and without CC/MCC, respectively), our clinical advisors note that ICD-10-CM diagnosis code T83.192A is not necessarily indicative of a patient having urinary stones. As such, they do not support adding ICD-10-CM diagnosis code T83.192A to the list of principal diagnosis codes for MS-DRGs 691 and 692.

We analyzed claims data to identify cases reporting ICD-10-CM diagnosis code T83.192A as a principal diagnosis with ESWL in MS-DRGs 698, 699, and 700 (Other Kidney and Urinary Tract Diagnoses with MCC, with CC, and without CC/MCC, respectively). Our findings are shown in the following table.

MS-DRGs for Other Kidney and Urinary Tract Diagnoses With Principal Diagnosis of Other Mechanical Complications of Indwelling Ureteral Stent With ESWL

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 698—All cases56,8036.1$11,220
MS-DRG 698—Cases with diagnosis code T83.192A reported as principal diagnosis357.114,574
MS-DRG 699—All cases33,6934.27,348
MS-DRG 699—Cases with diagnosis code T83.192A reported as principal diagnosis634.17,652
MS-DRG 699—Cases with diagnosis code T83.192A reported as principal diagnosis with ESWL137,986
Start Printed Page 19209
MS-DRG 700—All cases3,71935,356

For MS-DRG 698, there was a total of 56,803 cases reported, with an average length of stay of 6.1 days and average costs of $11,220. Of these 56,803 cases, 35 cases reported ICD-10-CM diagnosis code T83.192A as the principal diagnosis, with an average length of stay of 7.1 days and average costs of $14,574. There were no cases that reported an ESWL procedure with ICD-10-CM diagnosis code T83.192A as the principal diagnosis in MS-DRG 698. For MS-DRG 699, there was a total of 33,693 cases reported, with an average length of stay of 4.2 days and average costs of $7,348. Of the 33,693 cases in MS-DRG 699, there were 63 cases that reported ICD-10-CM diagnosis code T83.192A as the principal diagnosis, with an average length of stay of 4.1 days and average costs of $7,652. There was only 1 case in MS-DRG 699 that reported ICD-10-CM diagnosis code T83.192A as the principal diagnosis with an ESWL procedure, with an average length of stay of 3 days and average costs of $7,986. For MS-DRG 700, there was a total of 3,719 cases reported, with an average length of stay of 3 days and average costs of $5,356. There were no cases that reported ICD-10-CM diagnosis code T83.192A as the principal diagnosis in MS-DRG 700. Of the 98 cases in MS-DRGs 698 and 699 that reported a principal diagnosis of other mechanical complication of indwelling ureteral stent (diagnosis code T83.192A), only 1 case also reported an ESWL procedure. Based on the results of our data analysis and input from our clinical advisors, we are not proposing to add ICD-10-CM diagnosis code T83.192A to the list of principal diagnosis codes for MS-DRGs 691 and 692.

In connection with these requests, our clinical advisors recommended that we evaluate the frequency with which ESWL is reported in the inpatient setting across all the MS-DRGs. Therefore, we also analyzed claims data from the September 2018 update of the FY 2018 MedPAR file to identify the other MS-DRGs to which claims reporting an ESWL procedure were reported. Our findings are shown in the following table.

MS-DRGsMS-DRG description
654Major Bladder Procedures with CC.
657Kidney and Ureter Procedures for Neoplasm with CC.
659, 660, 661Kidney and Ureter Procedures for Non-Neoplasm with MCC, with CC, without CC/MCC, respectively.
662, 663Minor Bladder Procedures with MCC and with CC, respectively.
665, 666Prostatectomy with MCC and with CC, respectively.
668, 669, 670Transurethral Procedures with MCC, with CC, and without CC/MCC, respectively.
671Urethral Procedures with CC/MCC.
682, 683Renal Failure with MCC and with CC, respectively.
689, 690Kidney and Urinary Tract Infections with MCC and without MCC, respectively.
691, 692Urinary Stones with ESW Lithotripsy with CC/MCC and without CC/MCC, respectively.
696Kidney and Urinary Tract Signs and Symptoms without MCC.
698, 699, 700Other Kidney and Urinary Tract Diagnoses with MCC, with CC, and without CC/MCC, respectively.
982Extensive O.R. Procedure Unrelated to Principal Diagnosis with CC.

Our findings with respect to the cases reporting an ESWL procedure in each of these MS-DRGs, as compared to all cases in the applicable MS-DRG, are shown in the table below.

MS-DRGNumber of times reportedAverage length of stayAverage costs
MS-DRG 654—All cases3,8386.7$19,805
MS-DRG 654—Cases reporting ESWL159,102
MS-DRG 657—All cases7,2424.114,047
MS-DRG 657—Cases reporting ESWL2219,021
MS-DRG 659—All cases7,7618.118,717
MS-DRG 659—Cases reporting ESWL7111.126,366
MS-DRG 660—All cases17,6174.110,292
MS-DRG 660—Cases reporting ESWL193413,627
MS-DRG 661—All cases12,4342.37,997
MS-DRG 661—Cases reporting ESWL1542.712,639
MS-DRG 662—All cases61410.223,110
MS-DRG 662—Cases reporting ESWL12257,520
MS-DRG 663—All cases1,349511,213
MS-DRG 663—Cases reporting ESWL23.515,870
MS-DRG 665—All cases5899.421,328
MS-DRG 665—Cases reporting ESWL216.517,710
MS-DRG 666—All cases1,5175.613,060
MS-DRG 666—Cases reporting ESWL29.516,521
MS-DRG 668—All cases2,065920,229
Start Printed Page 19210
MS-DRG 668—Cases reporting ESWL1419,383
MS-DRG 669—All cases5,2594.911,217
MS-DRG 669—Cases reporting ESWL52.413,006
MS-DRG 670—All cases1,7072.67,177
MS-DRG 670—Cases reporting ESWL5318,416
MS-DRG 671—All cases3676.413,519
MS-DRG 671—Cases reporting ESWL1329,731
MS-DRG 682—All cases97,3475.710,384
MS-DRG 682—Cases reporting ESWL51026,773
MS-DRG 683—All cases132,2063.96,450
MS-DRG 683—Cases reporting ESWL413.319,706
MS-DRG 689—All cases68,0204.87,873
MS-DRG 689—Cases reporting ESWL1113.335,510
MS-DRG 690—All cases131,9993.55,692
MS-DRG 690—Cases reporting ESWL394.913,567
MS-DRG 691—All cases1403.911,997
MS-DRG 691—Cases reporting ESWL1403.911,997
MS-DRG 692—All cases1242.18,326
MS-DRG 692—Cases reporting ESWL1242.18,326
MS-DRG 696—All cases5,9332.94,938
MS-DRG 696—Cases reporting ESWL22.56,238
MS-DRG 698—All cases56,8036.111,220
MS-DRG 698—Cases reporting ESWL189.227,818
MS-DRG 699—All cases33,6934.27,348
MS-DRG 699—Cases reporting ESWL94.410,986
MS-DRG 700—All cases3,71935,356
MS-DRG 700—Cases reporting ESWL117,580
MS-DRG 982—All cases16,8346.316,939
MS-DRG 982—Cases reporting ESWL21174,751

Our data analysis indicates that, generally, the subset of cases reporting an ESWL procedure appear to have a longer average length of stay and higher average costs when compared to all the cases in their assigned MS-DRG. However, we note that this same subset of cases also reported at least one O.R. procedure and/or diagnosis designated as a CC or an MCC, which our clinical advisors believe are contributing factors to the longer average lengths of stay and higher average costs, with the exception of the case assigned to MS-DRG 700, which is a medical MS-DRG and has no CC or MCC conditions in the logic. Therefore, our clinical advisors do not believe that cases reporting an ESWL procedure should be considered as an indication of increased resource consumption for inpatient hospitalizations.

Our clinical advisors also suggested that we evaluate the reporting of ESWL procedures in the inpatient setting over the past few years. We analyzed claims data for MS-DRGs 691 and 692 from the FY 2012 through the FY 2016 MedPAR files, which were used in our analysis of claims data for MS-DRG reclassification requests effective for FY 2014 through FY 2018. We note that the analysis findings shown in the following table reflect ICD-9-CM, ICD-10-CM and ICD-10-PCS coded claims data.

MS-DRGFY 2014 (version 31)FY 2015 (version 32)FY 2016 (version 33)FY 2017 (version 34)FY 2018 (version 35)
Number of casesAverage length of stayAverage costsNumber of casesAverage length of stayAverage costsNumber of casesAverage length of stayAverage costsNumber of casesAverage length of stayAverage costsNumber of casesAverage length of stayAverage costs
MS-DRG 691—Urinary Stones with ESW Lithotripsy w CC/MCC8983.77$10,2748323.81$11,1418123.72$11,5347504.06$11,9074483.4$11,502
MS-DRG 692—Urinary Stones with ESW Lithotripsy without CC/MCC2312.027,2921972.148,0411332.329,2731032.399,398612.38,702

The data show a steady decline in the number of cases reporting urinary stones with an ESWL procedure for the past 5 years. As previously noted, the total number of cases reporting urinary stones with an ESWL procedure for MS-DRGs 691 and 692 based on our analysis of the September 2018 update of the FY 2018 MedPAR file was 264, which again is a decline from the prior year's figures. As discussed throughout this section, an ESWL procedure is a non-O.R. procedure which currently groups to medical MS-DRGs 691 and 692. Therefore, because an ESWL procedure is a non-O.R. procedure and due to decreased usage of this procedure in the inpatient setting for the treatment of urinary stones, our clinical advisors believe that there is no longer a clinical reason to subdivide the MS-DRGs for urinary stones (MS-DRGs 691, 692, 693, and 694) based on ESWL procedures.

Therefore, we are proposing to delete MS-DRGs 691 and 692 and to revise the titles for MS-DRGs 693 and 694 from “Urinary Stones without ESW Lithotripsy with MCC” and “Urinary Stones without ESW Lithotripsy without MCC”, respectively to “Urinary Stones with MCC” and “Urinary Stones without MCC”, respectively.

8. MDC 12 (Diseases and Disorders of the Male Reproductive System): Diagnostic Imaging of Male Anatomy

We received a request to review four ICD-10-CM diagnosis codes describing Start Printed Page 19211body parts associated with male anatomy that are currently assigned to MDC 5 (Diseases and Disorders of the Circulatory System) in MS-DRGs 302 and 303 (Atherosclerosis with MCC and Atherosclerosis without MCC, respectively). The four codes are listed in the following table.

ICD-10-CM codeCode description
R93.811Abnormal radiologic findings on diagnostic imaging of right testicle.
R93.812Abnormal radiologic findings on diagnostic imaging of left testicle.
R93.813Abnormal radiologic findings on diagnostic imaging of testicles, bilateral.
R93.819Abnormal radiologic findings on diagnostic imaging of unspecified testicle.

The requestor recommended that the four diagnosis codes shown in the table above be considered for assignment to MDC 12 (Diseases and Disorders of the Male Reproductive System), consistent with other diagnosis codes that include the male anatomy. However, the requestor did not suggest a specific MS-DRG assignment within MDC 12.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 302 and 303 to identify any cases reporting a diagnosis code for abnormal radiologic findings on diagnostic imaging of the testicles. We did not find any such cases.

Our clinical advisors reviewed this request and determined that the assignment of diagnosis codes R93.811, R93.812, R93.813, and R93.819 to MDC 5 in MS-DRGs 302 and 303 was a result of replication from ICD-9-CM diagnosis code 793.2 (Nonspecific (abnormal) findings on radiological and other examination of other intrathoracic organs) which was assigned to those MS-DRGs. Therefore, our clinical advisors support reassignment of these codes to MDC 12. Our clinical advisors agree that this reassignment is clinically appropriate because these diagnosis codes are specific to the male anatomy, consistent with other diagnosis codes in MDC 12 that include the male anatomy. Specifically, our clinical advisors suggest reassignment of the four diagnosis codes to MS-DRGs 729 and 730 (Other Male Reproductive System Diagnoses with CC/MCC and without CC/MCC, respectively). Therefore, we are proposing to reassign ICD-10-CM diagnosis codes R93.811, R93.812, R93.813, and R93.819 from MDC 5 in MS-DRGs 302 and 303 to MDC 12 in MS-DRGs 729 and 730.

9. MDC 14 (Pregnancy, Childbirth and the Puerperium): Proposed Reassignment of Diagnosis Code O99.89

We received a request to review the MS-DRG assignment for cases reporting ICD-10-CM diagnosis code O99.89 (Other specified diseases and conditions complicating pregnancy, childbirth and the puerperium). The requestor stated that it is experiencing MS-DRG shifts to MS-DRG 769 (Postpartum and Post Abortion Diagnoses with O.R. Procedure) as a result of the new obstetric MS-DRG logic when ICD-10-CM diagnosis code O99.89 is reported as a principal diagnosis in the absence of a delivery code on the claim (to indicate the patient delivered during that hospitalization), or when there is no other secondary diagnosis code on the claim indicating that the patient is in the postpartum period. According to the requestor, claims reporting ICD-10-CM diagnosis code O99.89 as a principal diagnosis for conditions described as occurring during the antepartum period that are reported with an O.R. procedure are grouping to MS-DRG 769. In the example provided by the requestor, ICD-10-CM diagnosis code O99.89 was reported as the principal diagnosis, with ICD-10-CM diagnosis codes N13.2 (Hydronephrosis with renal and ureteral calculous obstruction) and Z3A.25 (25 weeks of gestation of pregnancy) reported as secondary diagnoses with ICD-10-PCS procedure code 0T68DZ (Dilation of right ureter with intraluminal device, endoscopic approach), resulting in assignment to MS-DRG 769. The requestor noted that, in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41212), we stated “If there was not a principal diagnosis of abortion reported on the claim, the logic asks if there was a principal diagnosis of an antepartum condition reported on the claim. If yes, the logic then asks if there was an O.R. procedure reported on the claim. If yes, the logic assigns the case to one of the proposed new MS-DRGs 817, 818, or 819.” In the requestor's example, there were not any codes reported to indicate that the patient was in the postpartum period, nor was there a delivery code reported on the claim. Therefore, the requestor suggested that a more appropriate assignment for ICD-10-CM diagnosis code O99.89 may be MS-DRGs 817, 818, and 819 (Other Antepartum Diagnoses with O.R. Procedure with MCC, with CC and without CC/MCC, respectively).

In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41202 through 41216), we finalized our proposal to restructure the MS-DRGs within MDC 14 (Pregnancy, Childbirth and the Puerperium) which established new concepts for the GROUPER logic. As a result of the modifications made, ICD-10-CM diagnosis code O99.89 was classified as a postpartum condition and is currently assigned to MS-DRG 769 (Postpartum and Post Abortion Diagnoses with O.R. Procedure) and MS-DRG 776 (Postpartum and Post Abortion Diagnoses without O.R. Procedure) under the Version 36 ICD-10 MS-DRGs. As also discussed and displayed in Diagram 2 in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41212 through 41213), the logic asks if there was a principal diagnosis of a postpartum condition reported on the claim. If yes, the logic then asks if there was an O.R. procedure reported on the claim. If yes, the logic assigns the case to MS-DRG 769. If no, the logic assigns the case to MS-DRG 776. Therefore, the MS-DRG assignment for the example provided by the requestor is grouping accurately according to the current GROUPER logic.

We analyzed claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting diagnosis code O99.89 in MS-DRGs 769 and 776 as a principal diagnosis or as a secondary diagnosis. Our findings are shown in the following table.Start Printed Page 19212

Postpartum MS-DRGs With Principal or Secondary Diagnosis of Other Specified Diseases and Conditions Complicating Pregnancy, Childbirth and the Puerperium

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 769—All cases914.3$11,015
MS-DRG 769—Cases reporting diagnosis code O99.89 as principal diagnosis75.619,059
MS-DRG 769—Cases reporting diagnosis code O99.89 as secondary diagnosis6112.141,717
MS-DRG 776—All cases5603.15,332
MS-DRG 776—Cases reporting diagnosis code O99.89 as principal diagnosis573.56,439

As shown in the table above, we found a total of 91 cases in MS-DRG 769 with an average length of stay of 4.3 days and average costs of $11,015. Of these 91 cases, 7 cases reported ICD-10-CM diagnosis code O99.89 as a principal diagnosis with an average length of stay of 5.6 days and average costs of $19,059, and 61 cases reported ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 12.1 days and average costs of $41,717. For MS-DRG 776, we found a total of 560 cases with an average length of stay of 3.1 days and average costs of $5,332. Of these 560 cases, 57 cases reported ICD-10-CM diagnosis code O99.89 as a principal diagnosis with an average length of stay of 3.5 days and average costs of $6,439. There were no cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis in MS-DRG 776.

For MS-DRG 769, the data show that the 68 cases reporting ICD-10-CM diagnosis code O99.89 as a principal or secondary diagnosis have a longer average length of stay and higher average costs compared to all the cases in MS-DRG 769. For MS-DRG 776, the data show that the 57 cases reporting a principal diagnosis of ICD-10-CM diagnosis code O99.89 have a similar average length of stay compared to all the cases in MS-DRG 776 (3.5 days versus 3.1 days) and average costs that are consistent with the average costs of all cases in MS-DRG 776 ($6,439 versus $5,332).

We note that the description for ICD-10-CM diagnosis code O99.89 “Other specified diseases and conditions complicating pregnancy, childbirth and the puerperium”, describes conditions that may occur during the antepartum period (pregnancy), during childbirth, or during the postpartum period (puerperium). In addition, in the ICD-10-CM Tabular List of Diseases, there is an inclusion term at subcategory O99.8- instructing users that the reporting of any diagnosis codes in that subcategory is intended for conditions that are reported in certain ranges of the classification. Specifically, the inclusion term states “Conditions in D00-D48, H00-H95, M00-N99, and Q00-Q99.” There is also an instructional note to “Use additional code to identify condition.” As a result, ICD-10-CM diagnosis code O99.89 may be reported to identify conditions that occur during the antepartum period (pregnancy), during childbirth, or during the postpartum period (puerperium). However, it is not restricted to the reporting of obstetric specific conditions only. In the example provided by the requestor, ICD-10-CM diagnosis code O99.89 was reported as the principal diagnosis with ICD-10-CM diagnosis code N13.2 (Hydronephrosis with renal and ureteral calculous obstruction) as a secondary diagnosis. ICD-10-CM diagnosis code N13.2 is within the code range referenced earlier in this section (M00-N99) and qualifies as an appropriate condition for reporting according to the instruction.

As noted earlier, ICD-10-CM diagnosis code O99.89 is intended to report conditions that occur during the antepartum period (pregnancy), during childbirth, or during the postpartum period (puerperium) and is not restricted to the reporting of obstetric specific conditions only. However, because the diagnosis code description includes three distinct obstetric related stages, it is not clear what stage the patient is in by this single code. For example, upon review of subcategory O99.8-, we recognized that the other ICD-10-CM diagnosis code sub-subcategories are expanded to include unique codes that identify the condition as occurring or complicating pregnancy, childbirth or the puerperium. Specifically, sub-subcategory O99.81- (Abnormal glucose complicating pregnancy, childbirth, and the puerperium) is expanded to include the following ICD-10-CM diagnosis codes.

ICD-10-CM codeCode description
O99.810Abnormal glucose complicating pregnancy.
O99.814Abnormal glucose complicating childbirth.
O99.815Abnormal glucose complicating the puerperium.

The codes listed above specifically identify at what stage the abnormal glucose was a complicating condition. Because each code uniquely identifies a stage, the code can be easily classified under MDC 14 as an antepartum condition (ICD-10-CM diagnosis code O99.810), occurring during a delivery episode (ICD-10-CM diagnosis code O99.814), or as a postpartum condition (ICD-10-CM diagnosis code O99.815). The same is not true for ICD-10-CM diagnosis code O99.89 because it includes all three stages in the single code.

Therefore, we examined the number and type of secondary diagnoses reported with ICD-10-CM diagnosis code O99.89 as a principal diagnosis for MS-DRGs 769 and 776 to identify how many secondary diagnoses were related to other obstetric conditions and how many were related to non-obstetric conditions.Start Printed Page 19213

MS-DRGNumber of secondary diagnoses reported with O99.89 as principalNumber of secondary OB related diagnosesNumber of secondary OB related antepartum diagnosesNumber of secondary OB related postpartum diagnosesNumber of secondary OB related delivery diagnosesNumber of secondary non-OB related diagnoses
MS-DRG 7695913111146
MS-DRG 77637611388196263

As shown in the table above, there was a total of 59 secondary diagnoses reported with diagnosis code O99.89 as the principal diagnosis for MS-DRG 769. Of those 59 secondary diagnoses, 13 were obstetric (OB) related diagnosis codes (11 antepartum, 1 postpartum and 1 delivery) and 46 were non-obstetric (Non-OB) related diagnosis codes. For MS-DRG 776, there was a total of 376 secondary diagnoses reported with diagnosis code O99.89 as the principal diagnosis. Of those 376 secondary diagnoses, 113 were obstetric (OB) related diagnosis codes (88 antepartum, 19 postpartum and 6 delivery) and 263 were non-obstetric (Non-OB) related diagnosis codes.

The data reflect that, for MS-DRGs 769 and 776, the number of secondary diagnoses identified as OB-related antepartum diagnoses is greater than the number of secondary diagnoses identified as OB-related postpartum diagnoses (99 antepartum diagnoses versus 20 postpartum diagnoses). The data also indicate that, of the 435 secondary diagnoses reported with ICD-10-CM diagnosis code O99.89 as the principal diagnosis, 309 (71 percent) of those secondary diagnoses were non-OB-related diagnosis codes. Because there was a greater number of secondary diagnoses identified as OB-related antepartum diagnoses compared to the OB-related postpartum diagnoses within the postpartum MS-DRGs when ICD-10-CM diagnosis code O99.89 was reported as the principal diagnosis, we performed further analysis of diagnosis code O99.89 within the antepartum MS-DRGs.

Under the Version 35 ICD-10 MS-DRGs, diagnosis code O99.89 was classified as an antepartum condition and was assigned to MS-DRG 781 (Other Antepartum Diagnoses with Medical Complications). Therefore, we also analyzed claims data for MS-DRGs 817, 818 and 819 (Other Antepartum Diagnoses with O.R. Procedure with MCC, with CC and without CC/MCC, respectively) and MS-DRGs 831, 832, and 833 (Other Antepartum Diagnoses without O.R. Procedure with MCC, with CC and without CC/MCC, respectively) for cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis. We note that the analysis for the proposed FY 2020 ICD-10 MS-DRGs is based upon the September 2018 update of the FY 2018 MedPAR claims data that were grouped through the ICD-10 MS-DRG GROUPER Version 36. Our findings are shown in the table below.

Antepartum MS-DRGs With Secondary Diagnosis of Other Specified Diseases and Conditions Complicating Pregnancy, Childbirth and the Puerperium

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 817—All cases635.7$14,948
MS-DRG 817—Cases reporting diagnosis code O99.89 as secondary diagnosis810.824,359
MS-DRG 818—All cases784.19,343
MS-DRG 818—Cases reporting diagnosis code O99.89 as secondary diagnosis73.414,182
MS-DRG 819—All cases252.25,893
MS-DRG 819—Cases reporting diagnosis code O99.89 as secondary diagnosis114,990
MS-DRG 831—All cases7474.87,714
MS-DRG 831—Cases reporting diagnosis code O99.89 as secondary diagnosis1275.47,050
MS-DRG 832—All cases1,1423.65,159
MS-DRG 832—Cases reporting diagnosis code O99.89 as secondary diagnosis1454.25,656
MS-DRG 833—All cases5372.63,807
MS-DRG 833—Cases reporting diagnosis code O99.89 as secondary diagnosis472.63,307

As shown in the table above, we found a total of 63 cases in MS-DRG 817 with an average length of stay of 5.7 days and average costs of $14,948. Of these 63 cases, there were 8 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 10.8 days and average costs of $24,359. For MS-DRG 818, we found a total of 78 cases with an average length of stay of 4.1 days and average costs of $9,343. Of these 78 cases, there were 7 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 3.4 days and average costs of $14,182. For MS-DRG 819, we found a total of 25 cases with an average length of stay of 2.2 days and average costs of $5,893. Of these 25 cases, there was 1 case reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 1 day and average costs of $4,990.

For MS-DRG 831, we found a total of 747 cases with an average length of stay of 4.8 days and average costs of $7,714. Of these 747 cases, there were 127 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 5.4 days and average costs of $7,050. For MS-DRG 832, we found a total of 1,142 cases with an average length of stay of 3.6 days and average costs of $5,159. Of these 1,142 cases, there were 145 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 4.2 days and average costs of $5,656. For MS-DRG 833, we found a total of 537 cases with an average length of stay of 2.6 days and average costs of $3,807. Of these 537 cases, there were 47 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis with an average length of stay of 2.6 days and average costs of $3,307.Start Printed Page 19214

Overall, there was a total of 335 cases reporting ICD-10-CM diagnosis code O99.89 as a secondary diagnosis within the antepartum MS-DRGs. Of those 335 cases, 16 cases involved an O.R. procedure and 319 cases did not involve an O.R. procedure. The data indicate that ICD-10-CM diagnosis code O99.89 is reported more often as a secondary diagnosis within the antepartum MS-DRGs (335 cases) than it is reported as a principal or secondary diagnosis within the postpartum MS-DRGs (125 cases).

Our clinical advisors believe that, because ICD-10-CM diagnosis code O99.89 can be reported during the antepartum period (pregnancy), during childbirth, or during the postpartum period (puerperium), there is not a clear clinical indication as to which set of MS-DRGs (antepartum, delivery, or postpartum) would be the most appropriate assignment for this diagnosis code. They recommended that we collaborate with the National Center for Health Statistics (NCHS) at the Centers for Disease Control and Prevention (CDC), in consideration of a proposal to possibly expand ICD-10-CM diagnosis code O99.89 to become a sub-subcategory that would result in the creation of unique codes with a sixth digit character to specify which obstetric related stage the patient is in. For example, under subcategory O99.8-, a proposed new sub-subcategory for ICD-10-CM diagnosis code O99.89- could include the following proposed new diagnosis codes:

  • O99.890 (Other specified diseases and conditions complicating pregnancy);
  • O99.894 (Other specified diseases and conditions complicating childbirth); and
  • O99.85 (Other specified diseases and conditions complicating the puerperium).

If such a proposal to create this new sub-subcategory and new diagnosis codes were approved and finalized, it would enable improved data collection and more appropriate MS-DRG assignment, consistent with the current MS-DRG assignments of the existing obstetric related diagnosis codes. For instance, a new diagnosis code described as “complicating pregnancy” would be clinically aligned with the antepartum MS-DRGs, a new diagnosis code described as “complicating childbirth” would be clinically aligned with the delivery MS-DRGs, and a new diagnosis code described as “complicating the puerperium” would be clinically aligned with the postpartum MS-DRGs. (We note that all requests for new diagnosis codes require that a proposal be approved for discussion at a future ICD-10 Coordination and Maintenance Committee meeting.)

While our clinical advisors could not provide a strong clinical justification for classifying ICD-10-CM diagnosis code O99.89 as an antepartum condition versus as a postpartum condition for the reasons described above, they did consider the claims data to be informative as to how the diagnosis code is being reported for obstetric patients. In analyzing both the postpartum MS-DRGs and the antepartum MS-DRGs discussed earlier in this section, they agreed that the data clearly show that ICD-10-CM diagnosis code O99.89 is reported more frequently as a secondary diagnosis within the antepartum MS-DRGs than it is reported as a principal or secondary diagnosis within the postpartum MS-DRGs.

Based on our analysis of claims data and input from our clinical advisors, we are proposing to reclassify ICD-10-CM diagnosis code O99.89 from a postpartum condition to an antepartum condition under MDC 14. If finalized, ICD-10-CM diagnosis code O99.89 would follow the logic as described in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41212) which asks if there was a principal diagnosis of an antepartum condition reported on the claim. If yes, the logic then asks if there was an O.R. procedure reported on the claim. If yes, the logic assigns the case to MS-DRG 817, 818, or 819. If no (there was not an O.R. procedure reported on the claim), the logic assigns the case to MS-DRG 831, 832, or 833.

10. MDC 22 (Burns): Skin Graft to Perineum for Burn

We received a request to add seven ICD-10-PCS procedure codes that describe a skin graft to the perineum to MS-DRG 927 (Extensive Burns Or Full Thickness Burns with MV >96 Hours with Skin Graft) and MS-DRGs 928 and 929 (Full Thickness Burn with Skin Graft Or Inhalation Injury with CC/MCC and without CC/MCC, respectively) in MDC 22. The seven procedure codes are listed in the following table.

ICD-10-PCS codeCode description
0HR9X73Replacement of perineum skin with autologous tissue substitute, full thickness, external approach.
0HR9X74Replacement of perineum skin with autologous tissue substitute, partial thickness, external approach.
0HR9XJ3Replacement of perineum skin with synthetic substitute, full thickness, external approach.
0HR9XJ4Replacement of perineum skin with synthetic substitute, partial thickness, external approach.
0HR9XJZReplacement of perineum skin with synthetic substitute, external approach.
0HR9XK3Replacement of perineum skin with non-autologous tissue substitute, full thickness, external approach.
0HR9XK4Replacement of perineum skin with non-autologous tissue substitute, partial thickness, external approach.

These seven procedure codes are currently assigned to MS-DRGs 746 and 747 (Vagina, Cervix and Vulva Procedures with CC/MCC and without CC/MCC, respectively). In addition, when reported in conjunction with a principal diagnosis in MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs), these codes group to MS-DRGs 907, 908, and 909 (Other O.R. Procedures For Injuries with MCC, with CC and without CC/MCC, respectively), and when reported in conjunction with a principal diagnosis in MDC 24 (Multiple Significant Trauma), these codes group to MS-DRGs 957, 958, and 959 (Other O.R. Procedures For Multiple Significant Trauma with MCC, with CC and without CC/MCC, respectively). In addition, these procedures are designated as non-extensive O.R. procedures and are assigned to MS-DRGs 987, 988 and 989 (Non-Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) when a principal diagnosis that is unrelated to the procedure is reported on the claim.

The requestor provided an example in which it identified one case where a patient underwent debridement and split thickness skin graft (STSG) to the perineum area (only), and expressed concern that the case did not route to MS-DRGs 928 and 929 to recognize operating room resources. (We note that the requestor did not specify the diagnosis associated with this case nor the MS-DRG to which this one case was grouped.) The requestor stated that providers may document various terminologies for this anatomic site, Start Printed Page 19215including perineum, groin, and buttocks crease; therefore, when a provider deems a burn to affect the perineum as opposed to the groin or buttock crease, cases should route to MS-DRGs which compensate hospitals for skin grafting operating room resources. Therefore, the requestor recommended that the cited seven ICD-10-PCS codes be added to the list of procedure codes for a skin graft within MS-DRGs 927, 928, and 929.

We reviewed this request by analyzing claims data from the September 2018 update of the FY 2018 MedPAR file for cases reporting any of the above seven procedure codes in MS-DRGs 746, 747, 907, 908, 909, 957, 958, 959, 987, 988, and 989. Our findings are shown in the following table.

Cases Involving Skin Graft to the Perineum

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 746—All cases1,3445$11,847
MS-DRG 746—Cases with skin graft to the perineum procedure1210,830
MS-DRG 907—All cases7,8431028,919
MS-DRG 907—Cases with skin graft to the perineum procedure1821,909
MS-DRG 908—All cases9,2865.314,601
MS-DRG 908—Cases with skin graft to the perineum procedure168,410
MS-DRG 988—All cases8,3915.712,294
MS-DRG 988—Cases with skin graft to the perineum procedure236,906
MS-DRG 989—All cases1,5513.18,171
MS-DRG 989—Cases with skin graft to the perineum procedure1714,080

As shown in the table above, the overall volume of cases reporting a skin graft to the perineum procedure is low, with a total of 6 cases found. In MS-DRG 746, we found a total of 1,344 cases with an average length of stay of 5 days and average costs of $11,847. The single case reporting a skin graft to the perineum procedure in MS-DRG 746 had a length of stay of 2 days and a cost of $10,830. In MS-DRG 907, we found a total of 7,843 cases with an average length of stay of 10 days and average costs of $28,919. The single case reporting a skin graft to the perineum procedure in MS-DRG 907 had a length of stay of 8 days and a cost of $21,909. In MS-DRG 908, we found a total of 9,286 cases with an average length of stay of 5.3 days and average costs of $14,601. The single case reporting a skin graft to the perineum procedure in MS-DRG 908 had a length of stay of 6 days and a cost of $8,410. In MS-DRG 988, we found a total of 8,391 cases with an average length of stay of 5.7 days and average costs of $12,294. The 2 cases reporting a skin graft to the perineum procedure in MS-DRG 988 had an average length of stay of 3 days and average costs of $6,906. In MS-DRG 989, we found a total of 1,551 cases with an average length of stay of 3.1 days and average costs of $8,171. The single case reporting a skin graft to the perineum procedure in MS-DRG 989 had a length of stay of 7 day and a cost of $14,080. We found no cases reporting a skin graft to the perineum procedure in MS-DRG 747, 909, 957, 958, 959, or 987. Cases reporting a skin graft to the perineum procedure generally had shorter length of stays and lower average costs than those of their assigned MS-DRGs overall.

We then analyzed claims data for MS-DRGs 927, 928, and 929 (the MS-DRGs to which the requestor suggested that these cases group) for all cases reporting a procedure describing a skin graft to the perineum listed in the table above to consider how the resources involved in the cases reporting a procedure describing a skin graft to the perineum compared to those of all cases in MS-DRGs 927, 928, and 929. Our findings are shown in the following table.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 927—All cases14630.9$147,903
MS-DRG 928—All cases1,14915.745,523
MS-DRG 928—Cases with skin graft to the perineum procedure53964,041
MS-DRG 929—All cases2967.921,474

As shown in the table above, for MS-DRG 927, we found a total of 146 cases with an average length of stay of 30.9 days and average costs of $147,903; no cases reporting a skin graft to the perineum procedure were found. For MS-DRG 928, we found a total of 1,149 cases with an average length of stay of 15.7 days and average costs of $45,523. We found 5 cases reporting a skin graft to the perineum procedure with an average length of stay of 39 days and average costs of $64,041. For MS-DRG 929, we found a total of 296 cases with an average length of stay of 7.9 days and average costs of $21,474; and no cases reporting a skin graft to the perineum procedure were found. We note that none of the 5 cases reporting a skin graft to the perineum in MS-DRGs 927, 928, and 929 reported a skin graft to the perineum procedure as the only operating room procedure. Therefore, it is not possible to determine how much of the operating room resources for these 5 cases were attributable to the skin graft to the perineum procedure.

Our clinical advisors reviewed the claims data described above and noted that none of the cases reporting the seven identified procedure codes that grouped to MS-DRGs 746, 907, 908, 988, and 989 (listed in the table above) had a principal or secondary diagnosis of a burn, which suggests that these skin grafts were not performed to treat a burn. Therefore, our clinical advisors believe that it would not be appropriate for these cases that report a skin graft to the perineum procedure to group to MS-DRGs 927, 928, and 929, which describe burns. Our clinical advisors state that the seven ICD-10-PCS procedure codes that describe a skin graft to the perineum are more clinically aligned with the other procedures in MS-DRGs 746 and 747, to which they are currently assigned. Therefore, we are Start Printed Page 19216not proposing to add the seven identified procedure codes to MS-DRGs 927, 928, and 929.

11. MDC 23 (Factors Influencing Health Status and Other Contacts With Health Services): Proposed Assignment of Diagnosis Code R93.89

We received a request to consider reassignment of ICD-10-CM diagnosis code R93.89 (Abnormal finding on diagnostic imaging of other specified body structures) from MDC 5 (Diseases and Disorders of the Circulatory System) in MS-DRGs 302 and 303 (Atherosclerosis with and without MCC and Atherosclerosis without MCC, respectively) to MDC 23 (Factors Influencing Health Status and Other Contact with Health Services), consistent with other diagnosis codes that include abnormal findings. However, the requestor did not suggest a specific MS-DRG assignment within MDC 23.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 302 and 303 and identified cases reporting diagnosis code R93.89. Our findings are shown in the following table.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 302—All cases3,7503.8$7,956
MS-DRG 302—Cases reporting diagnosis code R93.8937.710,818
MS-DRG 303—All cases12,9862.34,920
MS-DRG 303—Cases reporting diagnosis code R93.891023,416

As shown in the table, for MS-DRG 302, there was a total of 3,750 cases with an average length of stay of 3.8 days and average costs of $7,956. Of these 3,750 cases, there were 3 cases reporting abnormal finding on diagnostic imaging of other specified body structures, with an average length of stay 7.7 days and average costs of $10,818. For MS-DRG 303, there was a total of 12,986 cases with an average length of stay of 2.3 days and average costs of $4,920. Of these 12,986 cases, there were 10 cases reporting abnormal finding on diagnostic imaging of other specified body structures, with an average length of stay 2 days and average costs of $3,416.

Our clinical advisors reviewed this request and determined that the assignment of diagnosis code R93.89 to MDC 5 in MS-DRGs 302 and 303 was a result of replication from ICD-9-CM diagnosis code 793.2 (Nonspecific (abnormal) findings on radiological and other examination of other intrathoracic organs), which was assigned to those MS-DRGs. Therefore, they support reassignment of diagnosis code R93.89 to MDC 23. Our clinical advisors agree this reassignment is clinically appropriate as it is consistent with other diagnosis codes in MDC 23 that include abnormal findings from other nonspecified sites. Specifically, our clinical advisors suggest reassignment of diagnosis code R89.93 to MS-DRGs 947 and 948 (Signs and Symptoms with and without MCC, respectively). Therefore, we are proposing to reassign ICD-10-CM diagnosis code R93.89 from MDC 5 in MS-DRGs 302 and 303 to MDC 23 in MS-DRGs 947 and 948.

12. Review of Procedure Codes in MS-DRGs 981 Through 983 and 987 Through 989

a. Adding Procedure Codes and Diagnosis Codes Currently Grouping to MS-DRGs 981 Through 983 or MS-DRGs 987 Through 989 into MDCs

We annually conduct a review of procedures producing assignment to MS-DRGs 981 through 983 (Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) or MS-DRGs 987 through 989 (Nonextensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) on the basis of volume, by procedure, to see if it would be appropriate to move cases reporting these procedure codes out of these MS-DRGs into one of the surgical MS-DRGs for the MDC into which the principal diagnosis falls. The data are arrayed in two ways for comparison purposes. We look at a frequency count of each major operative procedure code. We also compare procedures across MDCs by volume of procedure codes within each MDC. We use this information to determine which procedure codes and diagnosis codes to examine.

We identify those procedures occurring in conjunction with certain principal diagnoses with sufficient frequency to justify adding them to one of the surgical MS-DRGs for the MDC in which the diagnosis falls. We also consider whether it would be more appropriate to move the principal diagnosis codes into the MDC to which the procedure is currently assigned. Based on the results of our review of the claims data from the September 2018 update of the FY 2018 MedPAR file, we are proposing to move the cases reporting the procedures and/or principal diagnosis codes described below from MS-DRGs 981 through 983 or MS-DRGs 987 through 989 into one of the surgical MS-DRGs for the MDC into which the principal diagnosis or procedure is assigned.

(1) Gastrointestinal Stromal Tumors With Excision of Stomach and Small Intestine

Gastrointestinal stromal tumors (GIST) are tumors of connective tissue, and are currently assigned to MDC 8 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue). The ICD-10-CM diagnosis codes describing GIST are listed in the table below.

ICD-10-CM diagnosis codeCode description
C49.A0Gastrointestinal stromal tumor, unspecified site.
C49.A1Gastrointestinal stromal tumor of esophagus.
C49.A2Gastrointestinal stromal tumor of stomach.
C49.A3Gastrointestinal stromal tumor of small intestine.
C49.A4Gastrointestinal stromal tumor of large intestine.
C49.A5Gastrointestinal stromal tumor of rectum.
C49.A9Gastrointestinal stromal tumor of other sites.
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During our review of cases that group to MS-DRGs 981 through 983, we noted that when procedures describing open excision of the stomach or small intestine (ICD-10-PCS procedure codes 0DB60ZZ (Excision of stomach, open approach) and 0DB80ZZ (Excision of small intestine, open approach)) were reported with a principal diagnosis of GIST, the cases group to MS-DRGs 981 through 983. These two excision codes are assigned to several MDCs, as listed in the table below. Whenever there is a surgical procedure reported on the claim, which is unrelated to the MDC to which the case was assigned based on the principal diagnosis, it results in an MS-DRG assignment to a surgical class referred to as “unrelated operating room procedures”.

DRG Assignments for ICD-10-PCS Procedure Codes 0DB60ZZ and 0DB80ZZ

MDCDRGDRG Description
5264Other Circulatory O.R. Procedures.
6326-328Stomach, Esophageal and Duodenal Procedures.
10619-621Procedures for Obesity.
17820-822Lymphoma and Leukemia with Major Procedure.
17826-828Myeloproliferative Disorders or Poorly Differentiated Neoplasms with Major Procedure.
21907-909Other O.R. Procedures for Injuries.
24957-959Other Procedures for Multiple Significant Trauma.

We first examined cases that reported a principal diagnosis of GIST and ICD-10-PCS procedure code 0DB60ZZ or 0DB80ZZ that currently group to MS-DRGs 981 through 983, as well as all cases in MS-DRGs 981 through 983. Our findings are shown in the table below.

MS-DRGs 981-983: All Cases and Cases With Principal Diagnosis of GIST and Procedure Code 0DB60ZZ or 0DB80ZZ

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—All cases29,19211.3$29,862
MS-DRG 981—Cases with procedure code 0DB60ZZ4612.435,723
MS-DRG 981—Cases with procedure code 0DB80ZZ1210.828,059
MS-DRG 982—All cases16,8346.316,939
MS-DRG 982—Cases with procedure code 0DB60ZZ1046.817,442
MS-DRG 982—Cases with procedure code 0DB80ZZ41818,961
MS-DRG 983—All cases3,1663.311,872
MS-DRG 983—Cases with procedure code 0DB60ZZ974.511,901
MS-DRG 983—Cases with procedure code 0DB80ZZ194.59,971

Of the MDCs to which these gastrointestinal excision procedures are currently assigned, our clinical advisors indicated that cases with a principal diagnosis of GIST that also report an open gastrointestinal excision procedure code would logically be assigned to MDC 6 (Diseases and Disorders of the Digestive System). Within MDC 6, ICD-10-PCS procedures codes 0DB60ZZ and 0DB80ZZ are currently assigned to MS-DRGs 326, 327, and 328 (Stomach, Esophageal and Duodenal Procedures with MCC, CC, and without CC/MCC, respectively). To understand how the resources associated with the subset of cases reporting a principal diagnosis of GIST and procedure code 0DB60ZZ or 0DB80ZZ compare to those of cases in MS-DRGs 326, 327, and 328 as a whole, we examined the average costs and average length of stay for all cases in MS-DRGs 326, 327, and 328. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 326—All cases9,89813$36,129
MS-DRG 327—All cases9,6026.618,736
MS-DRG 328—All cases7,6342.911,555

Our clinical advisors reviewed these data and noted that the average length of stay and average costs of this subset of cases were similar to those of cases in MS-DRGs 326, 327, and 328 in MDC 6. To consider whether it was appropriate to move the GIST diagnosis codes from MDC 8, we examined the other procedure codes reported for cases that report a principal diagnosis of GIST and noted that almost all of the O.R. procedures most frequently reported were assigned to MDC 6 rather than MDC 8. Our clinical advisors believe that, given the similarity in resource use between this subset of cases and cases in MS-DRGs 326, 327, and 328, and that the GIST diagnosis codes are gastrointestinal in nature, they would be more appropriately assigned to MS-DRGs 326, 327, and 328 in MDC 6 than their current assignment in MDC 8. Therefore, we are proposing to move the GIST diagnosis codes listed above from MDC 8 to MDC 6 within MS-DRGs 326, 327, and 328. Under our proposal, cases reporting a principal diagnosis of GIST would group to MS-DRGs 326, 327, and 328.

(2) Peritoneal Dialysis Catheter Complications

During our review of the cases currently grouping to MS-DRGs 981-Start Printed Page 19218983, we noted that cases reporting a principal diagnosis of complications of peritoneal dialysis catheters with procedure codes describing removal, revision, and/or insertion of new peritoneal dialysis catheters group to MS-DRGs 981 through 983. The ICD-10-CM diagnosis codes that describe complications of peritoneal dialysis catheters, listed in the table below, are assigned to MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs). These principal diagnoses are frequently reported with the procedure codes describing removal, revision, and/or insertion of new peritoneal dialysis catheters.

ICD-10-CM codeCode description
T85.611ABreakdown (mechanical) of intraperitoneal dialysis catheter, initial encounter.
T85.621ADisplacement of intraperitoneal dialysis catheter, initial encounter.
T85.631ALeakage of intraperitoneal dialysis catheter, initial encounter.
T85.691AOther mechanical complication of intraperitoneal dialysis catheter, initial encounter.
T85.71XAInfection and inflammatory reaction due to peritoneal dialysis catheter, initial encounter.
T85.898AOther specified complication of other internal prosthetic devices, implants and graft, initial encounter.

The procedure codes in the table below describe removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes and are currently assigned to MDC 6 (Diseases and Disorders of the Digestive System) in MS-DRGs 356, 357, and 358 (Other Digestive System O.R. Procedures with MCC, with CC, and without CC/MCC, respectively).

ICD-10-PCS procedure codeCode description
0WHG03ZInsertion of infusion device into peritoneal cavity, open approach.
0WHG43ZInsertion of infusion device into peritoneal cavity, percutaneous endoscopic approach.
0WPG03ZRemoval of infusion device from peritoneal cavity, open approach.
0WPG43ZRemoval of infusion device from peritoneal cavity, percutaneous endoscopic approach.
0WWG03ZRevision of infusion device in peritoneal cavity, open approach.
0WWG0JZRevision of synthetic substitute in peritoneal cavity, open approach.
0WWG43ZRevision of infusion device in peritoneal cavity, percutaneous endoscopic approach.
0WWG4JZRevision of synthetic substitute in peritoneal cavity, percutaneous endoscopic approach.

We examined the claims data from the September 2018 update of the FY 2018 MedPAR file for the average costs and length of stay for cases that report a principal diagnosis of complications of peritoneal dialysis catheters with a procedure describing removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes. Our findings are shown in the table below. We note that we did not find any such cases in MS-DRG 983.

MS-DRG 981 Through 982: Peritoneal Dialysis Catheter Procedures With Principal Diagnosis of Complications of Peritoneal Dialysis Catheters

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting peritoneal dialysis catheter procedures with a principal diagnosis of complications of peritoneal dialysis catheters1,6038.5$20,676
MS-DRG 982—Cases reporting peritoneal dialysis catheter procedures with a principal diagnosis of complications of peritoneal dialysis catheters58.611,694

Our clinical advisors indicated that, within MDC 21, the procedures describing removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes most suitably group to MS-DRGs 907, 908, and 909, which contain all procedures for injuries that are not specific to the hand, skin, and wound debridement. To determine how the resources for this subset of cases compared to cases in MS-DRGs 907, 908, and 909 as a whole, we examined the average costs and length of stay for cases in MS-DRGs 907, 908, and 909. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 907—All cases9,4829.7$27,492
MS-DRG 908—All cases9,3055.314,597
MS-DRG 909—All cases3,01139,587

Our clinical advisors considered these data and noted that the average costs and length of stay for this subset of cases, most of which group to MS-DRG 981, are lower than the average costs and length of stay for cases of the same Start Printed Page 19219severity level in MS-DRGs 907. However, our clinical advisors believe that the procedures describing removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes are clearly related to the principal diagnosis codes describing complications of peritoneal dialysis catheters and, therefore, it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add the eight procedure codes listed in the table above that describe removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes to MDC 21 (Injuries, Poisonings & Toxic Effects of Drugs) in MS-DRGs 907, 908, and 909. Under this proposal, cases reporting a principal diagnosis of complications of peritoneal dialysis catheters with a procedure describing removal, revision, and/or insertion of new peritoneal dialysis catheters or revision of synthetic substitutes would group to MS-DRGs 907, 908, and 909.

(3) Bone Excision With Pressure Ulcers

During our review of the cases that group to MS-DRGs 981 through 983, we noted that when procedures describing excision of the sacrum, pelvic bones, and coccyx (ICD-10-PCS procedure codes 0QB10ZZ (Excision of sacrum, open approach), 0QB20ZZ (Excision of right pelvic bone, open approach), 0QB30ZZ (Excision of left pelvic bone, open approach), and 0QBS0ZZ (Excision of coccyx, open approach)) are reported with a principal diagnosis of pressure ulcers in MDC 9 (Diseases and Disorders of the Skin, Subcutaneous Tissue and Breast), the cases group to MS-DRGs 981 through 983. The procedures describing excision of the sacrum, pelvic bones, and coccyx group to several MDCs, which are listed in the table below.

MS-DRG Assignments for ICD-10-PCS Codes 0QB10ZZ, 0QB20ZZ, 0QB30ZZ, and 0QBS0ZZ

MDCMS-DRGMS-DRG description
3133-134Other Ear, Nose, Mouth and Throat O.R. Procedures with CC/MCC and without CC/MCC, respectively.
8515-517Other Musculoskeletal System and Connective Tissue O.R. Procedures with MCC, with CC, and without CC/MCC, respectively.
10628-630Other Endocrine, Nutritional and Metabolic O.R. Procedures with MCC, with CC, and without CC/MCC, respectively.
21907-909Other O.R. Procedures for Injuries.
24957-959Other Procedures for Multiple Significant Trauma.

When cases reporting procedure codes describing excision of the sacrum, pelvic bones, and coccyx report a principal diagnosis from MDC 9, the ICD-10-CM diagnosis codes that are most frequently reported as principal diagnoses are listed below.

ICD-10-CM diagnosis codeCode description
L89.150Pressure ulcer of sacral region, unstageable.
L89.153Pressure ulcer of sacral region, stage 3.
L89.154Pressure ulcer of sacral region, stage 4.
L89.214Pressure ulcer of right hip, stage 4.
L89.224Pressure ulcer of left hip, stage 4.
L89.314Pressure ulcer of right buttock, stage 4.
L89.324Pressure ulcer of left buttock, stage 4.
L89.894Pressure ulcer of other site, stage 4.

We examined the claims data from the September 2018 update of the FY 2018 MedPAR file for the average costs and length of stay for cases that report procedures describing excision of the sacrum, pelvic bones, and coccyx in conjunction with a principal diagnosis of pressure ulcers.

MS-DRGs 981 Through 983: Cases Reporting Excision of the Sacrum, Pelvic Bones, and Coccyx Reported With a Principal Diagnosis of Pressure Ulcers

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting excision of the sacrum, pelvic bones, and coccyx and a principal diagnosis of pressure ulcers39411.9$24,398
MS-DRG 982—Cases Reporting excision of the sacrum, pelvic bones, and coccyx and a principal diagnosis of pressure ulcers4779.416,464
MS-DRG 983—Cases Reporting excision of the sacrum, pelvic bones, and coccyx and a principal diagnosis of pressure ulcers384.88,519

Our clinical advisors indicated that, given the nature of these procedures, they could not be appropriately assigned to the specific surgical MS-DRGs within MDC 9, which are: Skin graft; skin debridement; mastectomy for malignancy; and breast biopsy, local excision, and other breast procedures. Therefore, our clinical advisors believe that these procedures would most suitably group to MS-DRGs 579, 580, and 581 (Other Skin, Subcutaneous Tissue and Breast Procedures with MCC, with CC, and without CC/MCC, respectively), which contain procedures Start Printed Page 19220assigned to MDC 9 that do not fit within the specific surgical MS-DRGs in MDC 9. Therefore, we examined the claims data for the average length of stay and average costs for MS-DRGs 579, 580, and 581 in MDC 9. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 5794,0919.2$19,873
MS-DRG 58010,0485.211,229
MS-DRG 5814,36438,987

Our clinical advisors reviewed these data and noted that, in this subset of cases, most cases group to MS-DRGs 981 and 982 and have greater average length of stay and average costs than those cases of the same severity level in MS-DRGs 579 and 580. The smaller number of cases that group to MS-DRG 983 have lower average costs than cases in MS-DRG 581. However, our clinical advisors believe that the procedure codes describing excision of the sacrum, pelvic bones, and coccyx are clearly related to the principal diagnosis codes describing pressure ulcers, as these procedures would be performed to treat pressure ulcers in the sacrum, hip, and buttocks regions. Therefore, our clinical advisors believe that it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add the ICD-10-PCS procedure codes describing excision of the sacrum, pelvic bones, and coccyx to MDC 9 in MS-DRGs 579, 580, and 581. Under this proposal, cases reporting a principal diagnosis in MDC 9 (such as pressure ulcers) with a procedure describing excision of the sacrum, pelvic bones, and coccyx would group to MS-DRGs 579, 580, and 581.

(4) Lower Extremity Muscle and Tendon Excision

During the review of the cases that group to MS-DRGs 981 through 983, we noted that when several ICD-10-PCS procedure codes describing excision of lower extremity muscles and tendons are reported in conjunction with ICD-10-CM diagnosis codes in MDC 10 (Endocrine, Nutritional and Metabolic Diseases and Disorders), the cases group to MS-DRGs 981 through 983. These ICD-10-PCS procedure codes are listed in the table below, and are assigned to several MS-DRGs, which are also listed below.

ICD-10-PCS procedure codeCode description
0KBN0ZZExcision of right hip muscle, open approach.
0KBP0ZZExcision of left hip muscle, open approach.
0KBS0ZZExcision of right lower leg muscle, open approach.
0KBT0ZZExcision of left lower leg muscle, open approach.
0KBV0ZZExcision of right foot muscle, open approach.
0KBW0ZZExcision of left foot muscle, open approach.
0LBV0ZZExcision of right foot tendon, open approach.
0LBW0ZZExcision of left foot tendon, open approach.
MDCMS-DRGMS-DRG description
01040-042Peripheral, Cranial Nerve and Other Nervous System Procedures with MCC, with CC or Peripheral Neurostimulator, and without CC/MCC, respectively.
08500-502Soft Tissue Procedures with MCC, with CC, and without CC/MCC, respectively.
09579-581Other Skin, Subcutaneous Tissue and Breast Procedures with MCC, with CC, and without CC/MCC, respectively.
21907-909Other O.R. Procedures for Injuries.
24957-959Other Procedures for Multiple Significant Trauma.

The ICD-10-CM diagnosis codes in MDC 10 that are most frequently reported as the principal diagnosis with a procedure describing excision of lower extremity muscles and tendons are listed in the table below. The combination indicates debridement procedures for more complex diabetic ulcers.

ICD-10-CM procedure codeCode description
E11.621Type 2 diabetes mellitus with foot ulcer.
E11.69Type 2 diabetes mellitus with other specified complication.
E11.628Type 2 diabetes mellitus with other skin complications.
E11.622Type 2 diabetes mellitus with other skin ulcer.
E10.621Type 1 diabetes mellitus with foot ulcer.

To understand the resource use for the subset of cases reporting procedure codes describing excision of lower extremity muscles and tendons that are currently grouping to MS-DRGs 981 through 983, we examined claims data Start Printed Page 19221for the average length of stay and average costs for these cases. Our findings are shown in the table below.

MS-DRGs 981-983: Cases Reporting Procedures Describing Excision of Lower Extremity Muscles and Tendons With a Principal Diagnosis in MDC 10

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting excision of lower extremity muscles and tendons and a principal diagnosis in MDC 101259.1$19,031
MS-DRG 982—Cases reporting excision of lower extremity muscles and tendons and a principal diagnosis in MDC 105616.212,000
MS-DRG 983—Cases reporting excision of lower extremity muscles and tendons and a principal diagnosis in MDC 10164.89,003

Our clinical advisors examined cases reporting procedures describing excision of lower extremity muscles and tendons with a principal diagnosis in the MS-DRGs within MDC 10 and determined that these cases would most suitably group to MS-DRGs 622, 623, and 624 (Skin Grafts and Wound Debridement for Endocrine, Nutritional and Metabolic Disorders with MCC, with CC, and without CC/MCC, respectively). Therefore, we examined the average length of stay and average costs for cases assigned to MS-DRGs 622, 623, and 624. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 6221,54011.7$25,114
MS-DRG 6234,8496.613,490
MS-DRG 6242323.77,442

Our clinical advisors reviewed these data and noted that most of the cases reporting procedures describing excision of lower extremity muscles and tendons group to MS-DRGs 981 and 982. For these cases, the average length of stay and average costs are lower than those of cases that currently group to MS-DRGs 622 and 623. However, our clinical advisors believe that these procedures are clearly related to the principal diagnoses in MDC 10, as they would be performed to treat skin-related complications of diabetes and, therefore, it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add the procedure codes listed previously describing excision of lower extremity muscles and tendons to MDC 10. Under our proposal, cases reporting these procedure codes with a principal diagnosis in MDC 10 would group to MS-DRGs 622, 623, and 624.

(5) Kidney Transplantation Procedures

During our review of the cases that group to MS-DRGs 981 through 983, we noted that when procedures describing transplantation of kidneys (ICD-10-PCS procedure codes 0TY00Z0 (Transplantation of right kidney, allogeneic, open approach) and 0TY10Z0 (Transplantation of left kidney, allogeneic, open approach)) are reported in conjunction with ICD-10-CM diagnosis codes in MDC 5 (Diseases and Disorders of the Circulatory System), the cases group to MS-DRGs 981 through 983. The ICD-10-CM diagnosis codes in MDC 5 that are reported with the kidney transplantation codes are I13.0 (Hypertensive heart and chronic kidney disease with heart failure and with stage 1 through stage 4 chronic kidney disease) and I13.2 (Hypertensive heart and chronic kidney disease with heart failure and with stage 5 chronic kidney disease), which group to MDC 5. Procedure codes describing transplantation of kidneys are assigned to MS-DRG 652 (Kidney Transplant) in MDC 11. We examined claims data to identify the average length of stay and average costs for cases reporting procedure codes describing transplantation of kidneys with a principal diagnosis in MDC 5, which are currently grouping to MS-DRGs 981 through 983. Our findings are shown in the table below. We did not find any such cases in MS-DRG 983.

MS-DRGs 981 Through 983: Cases Reporting Procedures Describing Transplantation of Kidney With a Principal Diagnosis in MDC 5

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting transplantation of kidney and a principal diagnosis in MDC 52856.8$25,340
MS-DRG 982—Cases reporting transplantation of kidney and a principal diagnosis in MDC 523.521,678

Our clinical advisors examined the MS-DRGs within MDC 5 and indicated that, given the nature of the procedures compared to the specific surgical procedures contained in the other surgical MS-DRGs in MDC 5, they could not be appropriately assigned to any of the specific surgical MS-DRGs. Therefore, they determined that these cases would most suitably group to MS-DRG 264 (Other Circulatory System O.R. Procedures), which contains a broader range of procedures related to MDC 5 diagnoses. We examined claims data to determine the average length of stay and Start Printed Page 19222average costs for cases assigned to MS-DRG 264. We found a total of 10,073 cases, with an average length of stay of 9.3 days and average costs of $22,643.

Our clinical advisors reviewed these data and noted that the average costs for cases reporting transplantation of kidney with a diagnosis from MDC 5 are similar to the average costs of cases in MS-DRG 264 ($22,643 in MS-DRG 264 compared to $25,340 in MS-DRG 981), while the average length of stay is shorter than that of cases in MS-DRG 264 (9.3 days in MS-DRG 264 compared to 6.8 days in MS-DRG 981). Our clinical advisors noted that ICD-10-CM diagnosis codes describing hypertensive heart and chronic kidney disease without heart failure (I13.10 (Hypertensive heart and chronic kidney disease without heart failure, with stage 1 through stage 4 chronic kidney disease, or unspecified chronic kidney disease) and I13.11 (Hypertensive heart and chronic kidney disease without heart failure, with stage 5 chronic kidney disease, or end stage renal disease group) group to MS-DRG 652 (Kidney Transplant) in MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract). Our clinical advisors also noted that the counterpart codes describing hypertensive heart and chronic kidney disease with heart failure are as related to the kidney transplantation codes as the codes without heart failure, but because the codes with heart failure group to MDC 5, cases reporting a kidney transplant procedure with a diagnosis code of hypertensive heart and chronic kidney disease with heart failure currently group to MS-DRGs 981 through 983. Therefore, we are proposing to add ICD-10-PCS procedure codes 0TY00Z0 and 0TY10Z0 to MS-DRG 264 in MDC 5. Under this proposal, cases reporting a principal diagnosis in MDC 5 with a procedure describing kidney transplantation would group to MS-DRG 264 in MDC 5. We note that because MDC 5 covers the circulatory system, and kidney transplants generally group to MDC 11, we are seeking public comments on whether the procedure codes should instead continue to group to MS-DRGs 981 through 983.

(6) Insertion of Feeding Device

During our review of the cases that group to MS-DRGs 981 through 983, we noted that when ICD-10-PCS procedure code 0DH60UZ (Insertion of feeding device into stomach, open approach) is reported with ICD-10-CM diagnosis codes assigned to MDC 1 (Diseases and Disorders of the Nervous System) or MDC 10 (Endocrine, Nutritional and Metabolic Diseases and Disorders), the cases group to MS-DRGs 981 through 983. ICD-10-PCS procedure code 0DH60UZ is currently assigned to MDC 6 (Diseases and Disorders of the Digestive System) in MS-DRGs 326, 327, and 328 (Stomach, Esophageal and Duodenal Procedures) and MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs) in MS-DRGs 907, 908, and 909 (Other O.R. Procedures for Injuries). We also noticed that: (1) When ICD-10-PCS procedure code 0DH60UZ is reported with a principal diagnosis in MDC 1, the ICD-10-CM diagnosis codes reported with this procedure code describe cerebral infarctions of various etiology and anatomic locations and resulting complications; and (2) when ICD-10-PCS procedure code 0DH60UZ is reported with a principal diagnosis in MDC 10, the ICD-10-CM diagnosis codes reported with this procedure code pertain to dehydration, failure to thrive, and various forms of malnutrition.

We examined claims data to identify the average length of stay and average costs for cases in MS-DRGs 981 through 983 reporting ICD-10-PCS procedure code 0DH60UZ in conjunction with a principal diagnosis from MDC 1 or MDC 10. Our findings are shown in the table below.

MS-DRGs 981 Through 983: Cases Reporting Procedure Code 0DH60UZ With a Principal Diagnosis in MDC 1 or MDC 10

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 111519.3$40,598
MS-DRG 982—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 14313.225,042
MS-DRG 983—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 1414.326,954
MS-DRG 981—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 104713.424,690
MS-DRG 982—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 10207.212,792
MS-DRG 983—Cases reporting procedure code 0DH60UZ and a principal diagnosis in MDC 1055.08,608

Our clinical advisors determined that the feeding tube procedure was related to specific diagnoses within MDC 1 and MDC 10 and, therefore, could be assigned to both MDCs. Therefore, they reviewed the MS-DRGs within MDC 1 and MDC 10. They determined that the most suitable MS-DRG assignment within MDC 1 would be MS-DRGs 040, 041, and 042 (Peripheral, Cranial Nerve and Other Nervous System Procedures with MCC, with CC or Peripheral Neurostimulator, and without CC/MCC, respectively), which contain procedures assigned to MDC 1 that describe insertion of devices into anatomical areas that are not part of the nervous system. Our clinical advisors determined that the most suitable MS-DRG assignment within MDC 10 would be MS-DRGs 628, 629, and 630 (Other Endocrine, Nutritional and Metabolic O.R. Procedures with MCC, with CC, and without CC/MCC, respectively), which contain the most clinically similar procedures assigned to MDC 10, such as those describing insertion of infusion pump into subcutaneous tissue and fascia. Therefore, we examined claims data to identify the average length of stay and average costs for cases assigned to MDC 1 in MS-DRGs 040, 041, and 042 and MDC 10 in MS-DRGs 628, 629, and 630. Our findings are shown in the tables below.Start Printed Page 19223

MS-DRGs in MDC 1Number of casesAverage length of stayAverage costs
MS-DRG 0404,21110.2$27,096
MS-DRG 0416,1535.116,917
MS-DRG 0422,2493.013,365
MS-DRGs in MDC 10Number of casesAverage length of stayAverage costs
MS-DRG 6283,0049.9$25,472
MS-DRG 6295,4357.216,391
MS-DRG 6302373.210,659

Our clinical advisors reviewed these data and noted that the average length of stay and average costs for the subset of cases reporting ICD-10-PCS procedure code 0DH60UZ with a principal diagnosis assigned to MDC 1 are higher than those cases in MS-DRGs 040, 041, and 042. For example, the cases reporting ICD-10-PCS procedure code 0DH60UZ and a principal diagnosis in MDC 1 that currently group to MS-DRG 981 have an average length of stay of 19.3 days and average costs of $40,598, while the cases in MS-DRG 040 have an average length of stay of 10.2 days and average costs of $27,096. Our clinical advisors noted that the average length of stay and average costs for the subset of cases reporting ICD-10-PCS procedure code 0DH60UZ with a principal diagnosis assigned to MDC 10 are more closely aligned with those cases in MS-DRGs 628, 629, and 630. In both cases, our clinical advisors believe that the insertion of feeding device is clearly related to the principal diagnoses in MDC 1 and MDC 10 and, therefore, it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add ICD-10-PCS procedure code 0DH60UZ to MDC 1 and MDC 10. Under this proposal, cases reporting procedure code 0DH60UZ with a principal diagnosis in MDC 1 would group to MS-DRGs 040, 041, and 042, while cases reporting ICD-10-PCS procedure code 0DH60UZ with a principal diagnosis in MDC 10 would group to MS-DRGs 628, 629, and 630.

(7) Basilic Vein Reposition in Chronic Kidney Disease

During our review of the cases that group to MS-DRGs 981 through 983, we noted that when procedures codes describing reposition of basilic vein (ICD-10-PCS procedure codes 05SB0ZZ (Reposition right basilic vein, open approach), 05SB3ZZ (Reposition right basilic vein, percutaneous approach), 05SC0ZZ (Reposition left basilic vein, open approach), and 05SC3ZZ (Reposition left basilic vein, percutaneous approach)) are reported with a principal diagnosis in MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract) (typically describing chronic kidney disease), the cases group to MS-DRGs 981 through 983. This code combination suggests a revision of an arterio-venous fistula in a patient on chronic hemodialysis. We examined claims data to identify the average length of stay and average costs for cases reporting procedures describing reposition of basilic vein with a principal diagnosis in MDC 11, which are currently grouping to MS-DRGs 981 through 983. Our findings are shown in the table below.

MS-DRGs 981-983: Cases Reporting Procedures Describing Reposition of Basilic Vein With Principal Diagnosis in MDC 11

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting procedures describing reposition of basilic vein and a principal diagnosis in MDC 11484.6$12,232
MS-DRG 982—Cases reporting procedures describing reposition of basilic vein and a principal diagnosis in MDC 11106.918,481
MS-DRG 983—Cases reporting procedures describing reposition of basilic vein and a principal diagnosis in MDC 1113.03,552

Our clinical advisors examined claims data for cases in the MS-DRGs within MDC 11 and determined that cases reporting procedures describing reposition of basilic vein with a principal diagnosis in MDC 11 would most suitably group to MS-DRGs 673, 674, and 675 (Other Kidney and Urinary Tract Procedures with MCC, with CC, and without CC/MCC, respectively), to which MDC 11 procedures describing reposition of veins (other than renal veins) are assigned. Therefore, we examined claims data to identify the average length of stay and average costs for cases assigned to MS-DRGs 673, 674, and 675. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 67310,54210.8$25,842
MS-DRG 6746,1677.417,685
MS-DRG 6754373.911,858
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Our clinical advisors reviewed these data and noted that the average length of stay and average costs for cases reporting procedures describing reposition of basilic vein with a principal diagnosis in MDC 11 with an MCC are significantly lower than for those cases in MS-DRG 673. The average length of stay and average costs are similar for those cases with a CC, while the single case without a CC or MCC had significantly lower costs than the average costs of cases in MS-DRG 675. However, our clinical advisors believe that when the procedures describing reposition of basilic vein are reported with a principal diagnosis describing chronic kidney disease, the procedure is likely related to arteriovenous fistulas for dialysis associated with the chronic kidney disease. Therefore, our clinical advisors believe that it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add ICD-10-PCS procedures codes 05SB0ZZ, 05SB3ZZ, 05SC0ZZ, and 05SC3ZZ to MDC 11. Under our proposal, cases reporting procedure codes describing reposition of basilic vein with a principal diagnosis in MDC 11 would group to MS-DRGs 673, 674, and 675.

(8) Colon Resection With Fistula

During our review of the cases that group to MS-DRGs 981 through 983, we noted that when ICD-10-PCS procedure code 0DTN0ZZ (Resection of sigmoid colon, open approach) is reported with a principal diagnosis in MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract), the cases group to MS-DRGs 981 through 983. The principal diagnosis most frequently reported with ICD-10-PCS procedure code 0DTN0ZZ in MDC 11 is ICD-10-CM code N321 (Vesicointestinal fistula). ICD-10-PCS procedure code 0DTN0ZZ currently groups to several MDCs, which are listed in the table below.

MS-DRG Assignments for ICD-10-PCS Procedure Code 0DTN0ZZ

MDCMS-DRGMS-DRG description
6329-331Major Small and Large Bowel Procedures.
17820-822Lymphoma and Leukemia with Major Procedure.
17826-828Myeloproliferative Disorders or Poorly Differentiated Neoplasms with Major Procedure.
21907-909Other O.R. Procedures for Injuries.
24957-959Other Procedures for Multiple Significant Trauma.

We examined claims data to identify the average length of stay and average costs for cases reporting procedure code 0DTN0ZZ with a principal diagnosis in MDC 11, which are currently grouping to MS-DRGs 981 through 983. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases reporting procedure code 0DTN0ZZ and a principal diagnosis in MDC 112715.81$44,743
MS-DRG 982—Cases reporting procedure code 0DTN0ZZ and a principal diagnosis in MDC 11338.4820,105
MS-DRG 983—Cases reporting procedure code 0DTN0ZZ and a principal diagnosis in MDC 1153.6012,351

Our clinical advisors examined the MS-DRGs within MDC 11 and determined that the cases reporting procedure code 0DTN0ZZ with a principal diagnosis in MDC 11 would most suitably group to MS-DRGs 673, 674, and 675, which contain procedures performed on structures other than kidney and urinary tract anatomy. We note that the claims data describing the average length of stay and average costs for cases in these MS-DRGs are included in a table earlier in this section. Because vesicointestinal fistulas involve both the bladder and the bowel, some procedures in both MDC 6 (Diseases and Disorders of the Digestive System) and MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract) would be expected to be related to a principal diagnosis of vesicointestinal fistula (ICD-10-CM code N321). Our clinical advisors observed that procedure code 0DTN0ZZ is the second most common procedure reported in conjunction with a principal diagnosis of code N321, after ICD-10-PCS procedure code 0TQB0ZZ (Repair bladder, open approach), which is assigned to both MDC 6 and MDC 11. Our clinical advisors reviewed the data and noted that the average length of stay and average costs for this subset of cases are generally higher for this subset of cases than for cases in MS-DRGs 673, 674, and 675. However, our clinical advisors believe that when ICD-10-PCS procedure code 0DTN0ZZ is reported with a principal diagnosis in MDC 11 (typically vesicointestinal fistula), the procedure is related to the principal diagnosis. Therefore, we are proposing to add ICD-10-PCS procedure code 0DTN0ZZ to MDC 11. Under our proposal, cases reporting procedure code 0DTN0ZZ with a principal diagnosis of vesicointestinal fistula (diagnosis code N321) in MDC 11 would group to MS-DRGs 673, 674, and 675.

b. Reassignment of Procedures Among MS-DRGs 981 Through 983 and 987 Through 989

We also review the list of ICD-10-PCS procedures that, when in combination with their principal diagnosis code, result in assignment to MS-DRGs 981 through 983, or 987 through 989, to ascertain whether any of those procedures should be reassigned from one of those two groups of MS-DRGs to the other group of MS-DRGs based on average costs and the length of stay. We look at the data for trends such as shifts in treatment practice or reporting practice that would make the resulting MS-DRG assignment illogical. If we find these shifts, we would propose to move cases to keep the MS-DRGs clinically similar or to provide payment for the cases in a similar manner. Generally, we move only those procedures for which we have an adequate number of discharges to analyze the data.Start Printed Page 19225

Based on the results of our review of claims data in the September 2018 update of the FY 2018 MedPAR file, we are not proposing to change the current structure of MS-DRGs 981 through 983 and MS-DRGs 987 through 989.

c. Proposed Additions for Diagnosis and Procedure Codes to MDCs

Below we summarize the requests we received to examine cases found to group to MS-DRGs 981 through 983 or MS-DRGs 987 through 989 to determine if it would be appropriate to add procedure codes to one of the surgical MS DRGs for the MDC into which the principal diagnosis falls or to move the principal diagnosis to the surgical MS-DRGs to which the procedure codes are assigned.

(1) Stage 3 Pressure Ulcers of the Hip

We received a request to reassign cases for a stage 3 pressure ulcer of the left hip when reported with procedures involving excision of pelvic bone or transfer of hip muscle from MS-DRGs 981, 982, and 983 (Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) to MS-DRG 579 (Other Skin, Subcutaneous Tissue and Breast Procedures with MCC) in MDC 9. ICD-10-CM diagnosis code L89.223 (Pressure ulcer left hip, stage 3) is used to report this condition and is currently assigned to MDC 9 (Diseases and Disorders of the Skin, Subcutaneous Tissue and Breast). We refer readers to section II.12.a. of the preamble of this proposed rule, where we address ICD-10-PCS procedure code 0QB30ZZ (Excision of left pelvic bone, open approach), which was reviewed as part of our ongoing analysis of the unrelated MS-DRGs and which we are proposing to add to MS-DRGs 579, 580, and 581 in MDC 5. (While the requestor only referred to base MS-DRG 579, we believe it is appropriate to assign the cases to MS-DRGs 579, 580, and 581 by severity level.) ICD-10-PCS procedure codes 0KXP0ZZ (Transfer left hip muscle, open approach) and 0KXN0ZZ (Transfer right hip muscle, open approach) may be reported to describe transfer of hip muscle procedures and are currently assigned to MDC 1 (Diseases and Disorders of the Nervous System) and MDC 8 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue). We included ICD-10-PCS procedure code 0KXN0ZZ in our analysis because it describes the identical procedure on the right side.

Our analysis of this grouping issue confirmed that, when a stage 3 pressure ulcer of the left hip (ICD-10-CM diagnosis code L89.223) is reported as a principal diagnosis with ICD-10-PCS procedure code 0KXP0ZZ or 0KXN0ZZ, these cases group to MS-DRGs 981, 982, and 983. The reason for this grouping is because whenever there is a surgical procedure reported on a claim that is unrelated to the MDC to which the case was assigned based on the principal diagnosis, it results in an MS-DRG assignment to a surgical class referred to as “unrelated operating room procedures.” In the example provided, because ICD-10-CM diagnosis code L89.223 describing a stage 3 pressure ulcer of left hip is classified to MDC 9 and because ICD-10-PCS procedure codes 0KXP0ZZ and 0KXN0ZZ are classified to MDC 1 (Diseases and Disorders of the Nervous System) in MS-DRGs 040, 041, and 042 (Peripheral, Cranial Nerve and Other Nervous System Procedures with MCC, with CC or Peripheral Neurostimulator, and without CC/MCC, respectively) and MDC 8 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue) in MS-DRGs 500, 501, and 502 (Soft Tissue Procedures with MCC, with CC, and without CC/MCC, respectively), the GROUPER logic assigns this case to the “unrelated operating room procedures” set of MS-DRGs.

For our review of this grouping issue and the request to have procedure code 0KXP0ZZ added to MDC 9, we examined claims data for cases reporting procedure code 0KXP0ZZ or 0KXN0ZZ in conjunction with a diagnosis code that typically groups to MDC 9. Our findings are shown in the table below.

MS-DRGs 981 Through 983: Cases With Hip Muscle Transfer and Principal Diagnosis in MDC 9

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases with procedure code 0KXP0ZZ or 0KXN0ZZ and principal diagnosis in MDC 97212.6$25,023
MS-DRG 982—Cases with procedure code 0KXP0ZZ or 0KXN0ZZ and principal diagnosis in MDC 913010.517,955
MS-DRG 983—Cases with procedure code 0KXP0ZZ or 0KXN0ZZ and principal diagnosis in MDC 9166.513,196

As indicated earlier, the requestor suggested that we move ICD-10-PCS procedure code 0KXP0ZZ to MS-DRG 579. However, our clinical advisors believe that, within MDC 9, these procedure codes are more clinically aligned with the procedure codes assigned to MS-DRGs 573, 574, and 575 (Skin Graft for Skin Ulcer or Cellulitis with MCC, with CC and without CC/MCC, respectively), which are more specific to the care of stage 3, 4 and unstageable pressure ulcers than MS-DRGs 579, 580, and 581. Therefore, we examined claims data to identify the average length of stay and average costs for cases assigned to MS-DRGs 573, 574, and 575. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 57354815.4$34,549
MS-DRG 5741,2549.821,251
MS-DRG 5752385.412,006

We note that the average costs for cases in MS-DRGs 573 and 574 are higher than the average costs of the subset of cases with the same severity reporting a hip muscle transfer and a principal diagnosis in MDC 9, while the average costs of those cases in MS-DRG 575 are similar to the average costs of those cases that are currently grouping Start Printed Page 19226to MS-DRG 983. However, our clinical advisors believe that the cases of hip muscle transfer represent a distinct, recognizable clinical group similar to those cases in MS-DRGs 573, 574, and 575, and that the procedures are clearly related to the principal diagnosis codes. Therefore, they believe that it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses. Therefore, we are proposing to add ICD-10-PCS procedure codes 0KXP0ZZ and 0KXN0ZZ to MDC 9. Under our proposal, cases reporting ICD-10-PCS procedure code 0KXP0ZZ or 0KXN0ZZ with a principal diagnosis in MDC 9 would group to MS-DRGs 573, 574, and 575.

(2) Gastrointestinal Stromal Tumor

We received a request to reassign cases for gastrointestinal stromal tumor of the stomach when reported with a procedure describing laparoscopic bypass of the stomach to jejunum from MS-DRGs 981, 982, and 983 to MS-DRGs 326, 327, and 328 (Stomach, Esophageal and Duodenal Procedures with MCC, with CC, and without CC/MCC, respectively) by adding ICD-10-PCS procedure code 0D164ZA (Bypass stomach to jejunum, percutaneous endoscopic approach) to MDC 6. ICD-10-CM diagnosis code C49.A2 (Gastrointestinal stromal tumor of stomach) is used to report this condition and is currently assigned to MDC 8. ICD-10-PCS procedure code 0D164ZA is used to report the stomach bypass procedure and is currently assigned to MDC 5 (Diseases and Disorders of the Circulatory System), MDC 6 (Diseases and Disorders of the Digestive System), MDC 7 (Diseases and Disorders of the Hepatobiliary System and Pancreas), MDC 10 (Endocrine, Nutritional and Metabolic Diseases and Disorders), and MDC 17 (Myeloproliferative Diseases and Disorders, Poorly Differentiated Neoplasms). We refer readers to section II.12.a. of the preamble of this proposed rule where we discuss our proposal to move the listed diagnosis codes describing gastrointestinal stromal tumors, including ICD-10-CM diagnosis code C49.A2, into MDC 6. Therefore, this proposal, if finalized, would address the cases grouping to MS-DRGs 981 through 983 by instead moving the diagnosis codes to MDC 6, which would result in the diagnosis code and the procedure code referenced by the requestor grouping to the same MDC.

(3) Finger Cellulitis

We received a request to reassign cases for cellulitis of the right finger when reported with a procedure describing open excision of the right finger phalanx from MS-DRGs 981, 982, and 983 to MS-DRGs 579, 580, and 581 (Other Skin, Subcutaneous Tissue and Breast Procedures with MCC, with CC, and without CC/MCC, respectively). Currently, ICD-10-CM diagnosis code L03.011 (Cellulitis of right finger) is used to report this condition and is currently assigned to MDC 09 in MS-DRGs 573, 574, and 575 (Skin Graft for Skin Ulcer or Cellulitis with MCC, CC, and without CC/MCC, respectively), 576, 577, and 578 (Skin Graft except for Skin Ulcer or Cellulitis with MCC, CC, and without CC/MCC, respectively), and 602 and 603 (Cellulitis with MCC and without MCC, respectively). ICD-10-PCS procedure code 0PBT0ZZ (Excision of right finger phalanx, open approach) is used to identify the excision procedure, and is currently assigned to MDC 03 (Diseases and Disorders of the Ear, Nose, Mouth and Throat) in MS-DRGs 133 and 134 (Other Ear, Nose, Mouth and Throat O.R. Procedures with CC/MCC, and without CC/MCC, respectively); MDC 08 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue) in MS-DRGs 515, 516, and 517 (Other Musculoskeletal System and Connective Tissue O.R. Procedures with MCC, with CC, and without CC/MCC, respectively); MDC 10 (Endocrine, Nutritional and Metabolic Diseases and Disorders) in MS-DRGs 628, 629, and 630 (Other Endocrine, Nutritional and Metabolic O.R. Procedures with MCC, with CC, and without CC/MCC, respectively); MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs) in MS-DRGs 907, 908, and 909 (Other O.R. Procedures for Injuries with MCC, with CC, and without CC/MCC, respectively); and MDC 24 (Multiple Significant Trauma) in MS-DRGs 957, 958, and 959 (Other O.R. Procedures for Multiple Significant Trauma with MCC, with CC, and without CC/MCC, respectively).

Our analysis of this grouping issue confirmed that when a procedure such as open excision of right finger phalanx (ICD-10-PCS procedure code 0PBT0ZZ) is reported with a principal diagnosis from MDC 9, such as cellulitis of the right finger (ICD-10-CM diagnosis code L03.011), these cases group to MS-DRGs 981, 982, and 983. During our review of this issue, we also examined claims data for similar procedures describing excision of phalanges (which are listed in the table below) and noted the same pattern. We further noted that the ICD-10-PCS procedure codes describing excision of phalanx procedures with the diagnostic qualifier “X”, which are used to report these procedures when performed for diagnostic purposes, are already assigned to MS-DRGs 579, 580, and 581 (to which the requestor suggested these cases group). Our clinical advisors also believe that procedures describing resection of phalanges should be assigned to the same MS-DRG as the excisions, because the resection procedures would also group to MS-DRGs 981, 982, and 983 when reported with a principal diagnosis from MDC 9.

ICD-10-PCS procedure codeCode description
0PBR0ZZExcision of right thumb phalanx, open approach.
0PBR3ZZExcision of right thumb phalanx, percutaneous approach.
0PBR4ZZExcision of right thumb phalanx, percutaneous endoscopic approach.
0PBS0ZZExcision of left thumb phalanx, open approach.
0PBS3ZZExcision of left thumb phalanx, percutaneous approach.
0PBS4ZZExcision of left thumb phalanx, percutaneous endoscopic approach.
0PBT0ZZExcision of right finger phalanx, open approach.
0PBT3ZZExcision of right finger phalanx, percutaneous approach.
0PBT4ZZExcision of right finger phalanx, percutaneous endoscopic approach.
0PBV0ZZExcision of left finger phalanx, open approach.
0PBV3ZZExcision of left finger phalanx, percutaneous approach.
0PBV4ZZExcision of left finger phalanx, percutaneous endoscopic approach.
0PTR0ZZResection of right thumb phalanx, open approach.
0PTS0ZZResection of left thumb phalanx, open approach.
0PTT0ZZResection of right finger phalanx, open approach.
0PTV0ZZResection of left finger phalanx, open approach.
0RTW0ZZResection of right finger phalangeal joint, open approach.
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0RTX0ZZResection of left finger phalangeal joint, open approach.

As noted in the previous discussion, whenever there is a surgical procedure reported on the claim that is unrelated to the MDC to which the case was assigned based on the principal diagnosis, it results in an MS-DRG assignment to a surgical class referred to as “unrelated operating room procedures”.

We examined the claims data for the three codes describing cellulitis of the finger (ICD-10-CM diagnosis codes L03.011 (Cellulitis of the right finger), L03.012 (Cellulitis of left finger), and L03.019 (Cellulitis of unspecified finger)) to identify the average length of stay and average costs for cases reporting a principal diagnosis of cellulitis of the finger in conjunction with the excision of phalanx procedures listed in the table above. We note that there were no cases reporting a principal diagnosis of cellulitis of the finger in conjunction with the resection of phalanx procedures listed in the table above.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 981—Cases with principal diagnosis of cellulitis of the finger and excision of phalanx procedure23.5$7,934
MS-DRG 982—Cases with principal diagnosis of cellulitis of the finger and excision of phalanx procedure114.27,244
MS-DRG 983—Cases with principal diagnosis of cellulitis of the finger and excision of phalanx procedure44.88,058

We also examined the claims data to identify the average length of stay and average costs for all cases in MS-DRGs 579, 580, and 581. Our findings are shown in the table in section II.12.A.3.of the preamble of this proposed rule.

While our clinical advisors noted that the average length of stay and average costs for cases in MS-DRGs 579, 580, and 581 are generally higher than the average length of stay and average costs for the subset of cases reporting a principal diagnosis of cellulitis of the finger and a procedure describing excision of phalanx, they believe that the procedures are clearly related to the principal diagnosis codes and, therefore, it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal diagnoses, particularly given that procedures describing excision of phalanx with the diagnostic qualifier “X” are already assigned to these MS-DRGs. In addition, our clinical advisors believe it is clinically appropriate for the procedures describing resection of phalanx to be assigned to MS-DRGs 579, 580, and 581 as well. Therefore, we are proposing to add the procedure codes describing excision and resection of phalanx listed above to MS-DRGs 579, 580, and 581. Under this proposal, cases reporting one of the excision or resection procedures listed in the table above in conjunction with a principal diagnosis from MDC 9 would group to MS-DRGs 579, 580, and 581.

(4) Multiple Trauma With Internal Fixation of Joints

We received a request to reassign cases involving multiple significant trauma with internal fixation of joints from MS-DRGs 981, 982, and 983 to MS-DRGs 957, 958, and 959 (Other O.R. Procedures for Multiple Significant Trauma with MCC, with CC, and without CC/MCC, respectively). The requestor provided an example of several ICD-10-CM diagnosis codes that together described multiple significant trauma in conjunction with ICD-10-PCS procedure codes beginning with the prefix “0SH” and “0RH” that describe internal fixation of joints. The requestor provided several suggestions to address this assignment, including: Adding all ICD-10-PCS procedure codes in MDC 8 (Diseases and Disorders of the Musculoskeletal System and Connective Tissue) with the exception of codes that group to MS-DRG 956 (Limb Reattachment, Hip and Femur Procedures for Multiple Significant Trauma) to MS-DRGs 957, 958, and 959; adding codes within the “0SH” and “0RH” code ranges to MDC 24; and adding ICD-10-PCS procedure codes from all MDCs except those that currently group to MS-DRG 955 (Craniotomy for Multiple Significant Trauma) or MS-DRG 956 (Limb Reattachment, Hip and Femur Procedures for Multiple Significant Trauma) to MS-DRGs 957, 958, and 959.

While we understand the requestor's concern about these multiple significant trauma cases, we believe any potential reassignment of these cases requires significant analysis. Similar to our analysis of MDC 14 (initially discussed at 81 FR 56854), there are multiple logic lists in MDC 24 that would need to be reviewed. For example, to satisfy the logic for multiple significant trauma, the logic requires a diagnosis code from the significant trauma principal diagnosis list and two or more significant trauma diagnoses from different body sites. The significant trauma logic lists for the other body sites (which include head, chest, abdominal, kidney, urinary system, pelvis or spine, upper limb, and lower limb) allow the extensive list of diagnosis codes included in the logic to be reported as a principal or secondary diagnosis. The analysis of the reporting of all the codes as a principal and/or secondary diagnosis within MDC 24, combined with the analysis of all of the ICD-10-PCS procedure codes within MDC 8, is anticipated to be a multi-year effort. Therefore, we plan to consider this issue for future rulemaking as part of our ongoing analysis of the unrelated procedure MS-DRGs.

(5) Totally Implantable Vascular Access Devices

We received a request to reassign cases for insertion of totally implantable vascular access devices (TIVADs) listed in the table below when reported with principal diagnoses in MDCs other than MDC 9 (Diseases and Disorders of the Skin, Subcutaneous Tissue and Breast) and MDC 11 (Diseases and Disorders of the Kidney and Urinary Tract) from MS-DRGs 981 through 983 to a surgical MS-DRG within the appropriate MDC based on the principal diagnosis. The requestor noted that the insertion of Start Printed Page 19228TIVAD procedures are newly designated as O.R. procedures, effective October 1, 2018, and are assigned to MDCs 9 and 11. The requestor stated that TIVADs can be placed for a variety of purposes and are used to treat a wide range of malignancies at various sites and, therefore, would likely have a relationship to the principal diagnosis within any MDC. The requestor suggested that procedures describing the insertion of TIVADs group to surgical MS-DRGs within every MDC (other than MDCs 2, 20, and 22, which do not contain surgical MS-DRGs). The requestor further stated that the surgical hierarchy should assign more significant O.R. procedures within each MDC to a higher position than procedures describing the insertion of TIVADs because these procedures consume less O.R. resources than more invasive procedures.

ICD-PCS codeCode description
0JH60WZInsertion of totally implantable vascular access device into chest subcutaneous tissue and fascia, open approach.
0JH80WZInsertion of totally implantable vascular access device into abdomen subcutaneous tissue and fascia, open approach.
0JHD0WZInsertion of totally implantable vascular access device into right upper arm subcutaneous tissue and fascia, open approach.
0JHF0WZInsertion of totally implantable vascular access device into left upper arm subcutaneous tissue and fascia, open approach.
0JHG0WZInsertion of totally implantable vascular access device into right lower arm subcutaneous tissue and fascia, open approach.
0JHH0WZInsertion of totally implantable vascular access device into left lower arm subcutaneous tissue and fascia, open approach.
0JHL0WZInsertion of totally implantable vascular access device into right upper leg subcutaneous tissue and fascia, open approach.
0JHM0WZInsertion of totally implantable vascular access device into left upper leg subcutaneous tissue and fascia, open approach.
0JHN0WZInsertion of totally implantable vascular access device into right lower leg subcutaneous tissue and fascia, open approach.
0JHP0WZInsertion of totally implantable vascular access device into left lower leg subcutaneous tissue and fascia, open approach.

While we agree that TIVAD procedures may be performed in connection with a variety of principal diagnoses, we note that because these procedures are newly designated as O.R. procedures effective October 1, 2018, we do not yet have sufficient data to analyze this request. We plan to consider this issue in future rulemaking as part of our ongoing analysis of the unrelated procedure MS-DRGs.

(6) Gastric Band Procedure Complications or Infections

We received a request to reassign cases for infection or complications due to gastric band procedures when reported with a procedure describing revision of or removal of extraluminal device in/from the stomach from MS-DRGs 987, 988, and 989 (Non-Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC and without MCC/CC, respectively) to MS-DRGs 326, 327, and 328 (Stomach, Esophageal, and Duodenal Procedures with MCC, with CC, and without CC/MCC, respectively). ICD-10-CM diagnosis codes K95.01 (Infection due to gastric band procedure) and K95.09 (Other complications of gastric band procedure) are used to report these conditions and are currently assigned to MDC 6 (Diseases and Disorders of the Digestive System). ICD-10-PCS procedure codes 0DW64CZ (Revision of extraluminal device in stomach, percutaneous endoscopic approach) and 0DP64CZ (Removal of extraluminal device from stomach, percutaneous endoscopic approach) are used to report the revision of, or removal of, an extraluminal device in/from the stomach and are currently assigned to MDC 10 (Endocrine, Nutritional and Metabolic Diseases and Disorders) in MS-DRGs 619, 620, and 621 (O.R. Procedures for Obesity with MCC with CC, and without CC/MCC, respectively).

Our analysis of this grouping issue confirmed that when procedures describing the revision of or removal of an extraluminal device in/from the stomach are reported with principal diagnoses in MDC 6 (such as ICD-10-CM diagnosis codes K95.01 and K95.09), in the absence of a procedure assigned to MDC 6, these cases group to MS-DRGs 987, 988, and 989. As noted in the previous discussion, whenever there is a surgical procedure reported on the claim that is unrelated to the MDC to which the case was assigned based on the principal diagnosis, it results in an MS-DRG assignment to a surgical class referred to as “unrelated operating room procedures”.

We examined the claims data to identify cases involving ICD-10-PCS procedure codes 0DW64CZ and 0DP64CZ reported with a principal diagnosis of K95.01 or K95.09 that are currently grouping to MS-DRGs 987, 988, and 989. Our findings are shown in the table below.

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 987—All cases8,67411$23,885
MS-DRG 987—Cases reporting procedure code 0DW64CZ or 0DP64CZ and principal diagnosis code K95.01 or K95.09206.617,873
MS-DRG 988—All cases8,3915.712,294
MS-DRG 988—Cases reporting procedure code 0DW64CZ or 0DP64CZ and principal diagnosis code K95.01 or K95.091052.27,253
MS-DRG 989—All cases1,5513.18,171
MS-DRG 989—Cases reporting procedure code 0DW64CZ or 0DP64CZ and principal diagnosis code K95.01 or K95.091201.66,010

We also examined the data for cases in MS-DRGs 326, 327, and 328, and our findings are provided in a table presented in section II.12.a. of the preamble of this proposed rule. While our clinical advisors noted that the average length of stay and average costs of cases in MS-DRGs 326, 327, and 328 are significantly higher than the average length of stay and average costs for the subset of cases reporting procedure code 0DW64CZ or 0DP64CZ and a principal diagnosis code of K95.01 or K95.09, they believe that the procedures are clearly related to the principal diagnosis and, therefore, it is clinically appropriate for the procedures to group to the same MS-DRGs as the principal Start Printed Page 19229diagnoses. In addition, our clinical advisors believe that because these procedures are intended to treat a complication of a procedure related to obesity, rather than the obesity itself, they are more appropriately assigned to stomach, esophageal, and duodenal procedures (MS-DRGs 326, 327, and 328) in MDC 6 than to procedures for obesity (MS-DRGs 619, 620, and 621) in MDC 10.

Therefore, we are proposing to add ICD-10-PCS procedure codes 0DW64CZ and 0DP64CZ to MDC 6 in MS-DRGs 326, 327, and 328. Under this proposal, cases reporting procedure code 0DW64CZ or 0DP64CZ in conjunction with a principal diagnosis code of K95.01 or K95.09 would group to MS-DRGs 326, 327, and 328.

(7) Peritoneal Dialysis Catheters

We received a request to reassign cases for complications of peritoneal dialysis catheters when reported with procedure codes describing removal, revision, and/or insertion of new peritoneal dialysis catheters from MS-DRGs 981 through 983 to MS-DRGs 356, 357, and 358 (Other Digestive System O.R. Procedures with MCC, with CC, and without CC/MCC, respectively) in MDC 6 by adding the diagnosis codes describing complications of peritoneal dialysis catheters to MDC 6. We refer readers to section II.12.a. of the preamble of this proposed rule in which we describe our analysis of this issue as part of our broader review of the unrelated MS-DRGs. Our clinical advisors believe it is more appropriate to add the procedure codes describing removal, revision, and/or insertion of new peritoneal dialysis catheters to MS-DRGs 907, 908, and 909 than to move the diagnosis codes describing complications of peritoneal dialysis catheters to MDC 6 because the diagnosis codes describe complications, rather than initial placement, of peritoneal dialysis catheters, and therefore, are most clinically aligned with the diagnosis codes assigned to MDC 21 (where they are currently assigned). In section II.12.a. of the preamble of this proposed rule, we are proposing to add procedures describing removal, revision, and/or insertion of peritoneal dialysis catheters to MS-DRGs 907, 908, and 909 in MDC 21.

(8) Occlusion of Left Renal Vein

We received a request to reassign cases for varicose veins in the pelvic region when reported with an embolization procedure from MS-DRGs 981, 982 and 983 (Non-Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) to MS-DRGs 715 and 716 (Other Male Reproductive System O.R. Procedures for Malignancy with CC/MCC and without CC/MCC, respectively) and MS-DRGs 717 and 718 (Other Male Reproductive System O.R. Procedures Except Malignancy with CC/MCC and without CC/MCC, respectively) in MDC 12 (Diseases and Disorders of the Male Reproductive System) and to MS-DRGs 749 and 750 (Other Female Reproductive System O.R. Procedures with CC/MCC and without CC/MCC, respectively) in MDC 13 (Diseases and Disorders of the Female Reproductive System). ICD-10-CM diagnosis code I86.2 (Pelvic varices) is reported to identify the condition of varicose veins in the pelvic region and is currently assigned to MDC 12 and to MDC 13. ICD-10-PCS procedure code 06LB3DZ (Occlusion of left renal vein with intraluminal device, percutaneous approach) may be reported to describe an embolization procedure performed for the treatment of pelvic varices and is currently assigned to MDC 5 (Diseases and Disorders of the Circulatory System) in MS-DRGs 270, 271, and 272 (Other Major Cardiovascular Procedures with MCC, with CC, and without CC/MCC, respectively), MDC 6 (Diseases and Disorders of the Digestive System) in MS-DRGs 356, 357, and 358 (Other Digestive System O.R. Procedures with MCC, with CC, and without CC/MCC, respectively), MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs) in MS-DRGs 907, 908, and 909 (Other O.R. Procedures for Injuries with MCC, CC, without CC/MCC, respectively), and MDC 24 (Multiple Significant Trauma) in MS-DRGs 957, 958, 959 (Other O.R. Procedures for Multiple Significant Trauma with MCC, with CC, and without CC/MCC, respectively). The requestor also noted that when this procedure is performed on the right renal vein (which is reported with ICD-10-PCS code 06L03DZ (Occlusion of inferior vena cava with intraluminal device, percutaneous approach) for varicose veins in the pelvic region, the case groups to MS-DRGs 715 and 716 and MS-DRGs 717 and 718 in MDC 12 (for male patients) or MS-DRGs 749 and 750 in MDC 13 (for female patients).

Our analysis of this grouping issue confirmed that when ICD-10-CM diagnosis code I86.2 (Pelvic varices) is reported with ICD-10-PCS procedure code 06LB3DZ, the case groups to MS-DRGs 981, 982, and 983. As noted above in previous discussions, whenever there is a surgical procedure reported on the claim that is unrelated to the MDC to which the case was assigned based on the principal diagnosis, it results in an MS-DRG assignment to a surgical class referred to as “unrelated operating room procedures.”

We examined the claims data to identify cases involving procedure code 06LB3DZ in MS-DRGs 981, 982, and 983 reported with a principal diagnosis code of I86.2. We found no cases in the claims data.

In the absence of data to examine, our clinical advisors reviewed this request and agree with the requestor that when the embolization procedure is performed on the left renal vein (reported with ICD-10-PCS procedure code 06LB3DZ), it should group to the same MS-DRGs as when it is performed on the right renal vein. Therefore, we are proposing to add ICD-10-PCS procedure code 06LB3DZ to MDC 12 in MS-DRGs 715, 716, 717, and 718 and to MDC 13 in MS-DRGs 749 and 750. Under this proposal, cases reporting ICD-10-CM diagnosis code I86.2 with ICD-10-PCS procedure code 06LB3DZ would group to MDC 12 (for male patients) or MDC 13 (for female patients).

13. Operating Room (O.R.) and Non-O.R. Issues

a. Background

Under the IPPS MS-DRGs (and former CMS MS-DRGs), we have a list of procedure codes that are considered operating room (O.R.) procedures. Historically, we developed this list using physician panels that classified each procedure code based on the procedure and its effect on consumption of hospital resources. For example, generally the presence of a surgical procedure which required the use of the operating room would be expected to have a significant effect on the type of hospital resources (for example, operating room, recovery room, and anesthesia) used by a patient, and therefore, these patients were considered surgical. Because the claims data generally available do not precisely indicate whether a patient was taken to the operating room, surgical patients were identified based on the procedures that were performed. Generally, if the procedure was not expected to require the use of the operating room, the patient would be considered medical (non-O.R.).

Currently, each ICD-10-PCS procedure code has designations that determine whether and in what way the presence of that procedure on a claim impacts the MS-DRG assignment. First, each ICD-10-PCS procedure code is either designated as an O.R. procedure for purposes of MS-DRG assignment Start Printed Page 19230(“O.R. procedures”) or is not designated as an O.R. procedure for purposes of MS-DRG assignment (“non-O.R. procedures”). Second, for each procedure that is designated as an O.R. procedure, that O.R. procedure is further classified as either extensive or non-extensive. Third, for each procedure that is designated as a non-O.R. procedure, that non-O.R. procedure is further classified as either affecting the MS-DRG assignment or not affecting the MS-DRG assignment. We refer to these designations that do affect MS-DRG assignment as “non-O.R. affecting the MS-DRG.” For new procedure codes that have been finalized through the ICD-10 Coordination and Maintenance Committee meeting process and are proposed to be classified as O.R. procedures or non-O.R. procedures affecting the MS-DRG, our clinical advisors recommend the MS-DRG assignment which is then made available in association with the proposed rule (Table 6B.—New Procedure Codes) and subject to public comment. These proposed assignments are generally based on the assignment of predecessor codes or the assignment of similar codes. For example, we generally examine the MS-DRG assignment for similar procedures, such as the other approaches for that procedure, to determine the most appropriate MS-DRG assignment for procedures proposed to be newly designated as O.R. procedures. As discussed in section II.F.15. of the preamble of this proposed rule, we are making Table 6B.—New Procedure Codes—FY 2020 available on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html. We also refer readers to the ICD-10 MS-DRG Version 36 Definitions Manual at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​MS-DRG-Classifications-and-Software.html for detailed information regarding the designation of procedures as O.R. or non-O.R. (affecting the MS-DRG) in Appendix E—Operating Room Procedures and Procedure Code/MS-DRG Index.

Given the long period of time that has elapsed since the original O.R. (extensive and non-extensive) and non-O.R. designations were established, the incremental changes that have occurred to these O.R. and non-O.R. procedure code lists, and changes in the way inpatient care is delivered, we plan to conduct a comprehensive, systematic review of the ICD-10-PCS procedure codes. This will be a multi-year project during which we will also review the process for determining when a procedure is considered an operating room procedure. For example, we may restructure the current O.R. and non-O.R. designations for procedures by leveraging the detail that is now available in the ICD-10 claims data. We refer readers to the discussion regarding the designation of procedure codes in the FY 2018 IPPS/LTCH PPS final rule (82 FR 38066) where we stated that the determination of when a procedure code should be designated as an O.R. procedure has become a much more complex task. This is, in part, due to the number of various approaches available in the ICD-10-PCS classification, as well as changes in medical practice. While we have typically evaluated procedures on the basis of whether or not they would be performed in an operating room, we believe that there may be other factors to consider with regard to resource utilization, particularly with the implementation of ICD-10. Therefore, we are again soliciting public comments on what factors or criteria to consider in determining whether a procedure is designated as an O.R. procedure in the ICD-10-PCS classification system for future consideration. Commenters should submit their recommendations to the following email address: MSDRGClassificationChange@cms.hhs.gov by November 1, 2019.

As a result of this planned review and potential restructuring, procedures that are currently designated as O.R. procedures may no longer warrant that designation, and conversely, procedures that are currently designated as non-O.R. procedures may warrant an O.R. type of designation. We intend to consider the resources used and how a procedure should affect the MS-DRG assignment. We may also consider the effect of specific surgical approaches to evaluate whether to subdivide specific MS-DRGs based on a specific surgical approach. We plan to utilize our available MedPAR claims data as a basis for this review and the input of our clinical advisors. As part of this comprehensive review of the procedure codes, we also intend to evaluate the MS-DRG assignment of the procedures and the current surgical hierarchy because both of these factor into the process of refining the ICD-10 MS-DRGs to better recognize complexity of service and resource utilization.

We will provide more detail on this analysis and the methodology for conducting this review in future rulemaking. As we continue to develop our process and methodology, as noted above, we are soliciting public comments on other factors to consider in our refinement efforts to recognize and differentiate consumption of resources for the ICD-10 MS-DRGs.

In this proposed rule, we are addressing requests that we received regarding changing the designation of specific ICD-10-PCS procedure codes from non-O.R. to O.R. procedures, or changing the designation from O.R. procedure to non-O.R. procedure. Below we discuss the process that was utilized for evaluating the requests that were received for FY 2020 consideration. For each procedure, our clinical advisors considered:

  • Whether the procedure would typically require the resources of an operating room;
  • Whether it is an extensive or a nonextensive procedure; and
  • To which MS-DRGs the procedure should be assigned.

We note that many MS-DRGs require the presence of any O.R. procedure. As a result, cases with a principal diagnosis associated with a particular MS-DRG would, by default, be grouped to that MS-DRG. Therefore, we do not list these MS-DRGs in our discussion below. Instead, we only discuss MS-DRGs that require explicitly adding the relevant procedures codes to the GROUPER logic in order for those procedure codes to affect the MS-DRG assignment as intended. In cases where we are proposing to change the designation of procedure codes from non-O.R. procedures to O.R. procedures, we also are proposing one or more MS-DRGs with which these procedures are clinically aligned and to which the procedure code would be assigned.

In addition, cases that contain O.R. procedures will map to MS-DRG 981, 982, or 983 (Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) or MS-DRG 987, 988, or 989 (Non-Extensive O.R. Procedure Unrelated to Principal Diagnosis with MCC, with CC, and without CC/MCC, respectively) when they do not contain a principal diagnosis that corresponds to one of the MDCs to which that procedure is assigned. These procedures need not be assigned to MS-DRGs 981 through 989 in order for this to occur. Therefore, if requestors included some or all of MS-DRGs 981 through 989 in their request or included MS-DRGs that require the presence of any O.R. procedure, we did not specifically address that aspect in summarizing their request or our response to the request in the section below.

For procedures that would not typically require the resources of an operating room, our clinical advisors Start Printed Page 19231determined if the procedure should affect the MS-DRG assignment.

We received several requests to change the designation of specific ICD-10-PCS procedure codes from non-O.R. procedures to O.R. procedures, or to change the designation from O.R. procedures to non-O.R. procedures. Below we detail and respond to some of those requests. With regard to the remaining requests, our clinical advisors believe it is appropriate to consider these requests as part of our comprehensive review of the procedure codes discussed above.

b. O.R. Procedures to Non-O.R. Procedures

(1) Bronchoalveolar Lavage

Bronchoalveolar lavage (BAL) is a diagnostic procedure in which a bronchoscope is passed through the patient's mouth or nose into the lungs. A small amount of fluid is squirted into an area of the lung and then collected for examination. Two requestors identified 13 ICD-10-PCS procedure codes describing BAL procedures that generally can be performed at bedside and would not require the resources of an operating room. In the ICD-10 MS-DRG Version 36 Definitions Manual, these 13 ICD-10-PCS procedure codes are currently recognized as O.R. procedures for purposes of MS-DRG assignment.

We agree with the requestors that these procedures do not typically require the resources of an operating room. Therefore, we are proposing to remove the following 13 procedure codes from the FY 2020 ICD-10 MS-DRGs Version 37 Definitions Manual in Appendix E—Operating Room Procedures and Procedure Code/MS-DRG Index as O.R. procedures. Under this proposal, these procedures would no longer impact MS-DRG assignment.

ICD-10-PCS codeCode description
0B9H8ZXDrainage of lung lingula, via natural or artificial opening endoscopic, diagnostic.
0B9K8ZXDrainage of right lung, via natural or artificial opening endoscopic, diagnostic.
0B9L8ZXDrainage of left lung, via natural or artificial opening endoscopic, diagnostic.
0B9M8ZXDrainage of bilateral lungs, via natural or artificial opening endoscopic, diagnostic.
0B9C8ZZDrainage of right upper lung lobe, via natural or artificial opening endoscopic.
0B9D8ZZDrainage of right middle lung lobe, via natural or artificial opening endoscopic.
0B9F8ZZDrainage of right lower lung lobe, via natural or artificial opening endoscopic.
0B9G8ZZDrainage of left upper lung lobe, via natural or artificial opening endoscopic.
0B9H8ZZDrainage of Lung Lingula, via natural or artificial opening endoscopic.
0B9J8ZZDrainage of left lower lung lobe, via natural or artificial opening endoscopic.
0B9K8ZZDrainage of right lung, via natural or artificial opening endoscopic.
0B9L8ZZDrainage of left lung, via natural or artificial opening endoscopic.
0B9M8ZZDrainage of bilateral lungs, via natural or artificial opening endoscopic.

(2) Percutaneous Drainage of Pelvic Cavity

One requestor identified two ICD-10-PCS procedure codes that describe procedures involving percutaneous drainage of the pelvic cavity. The two ICD-10-PCS procedure codes are: 0W9J3ZX (Drainage of pelvic cavity, percutaneous approach, diagnostic) and 0W9J3ZZ (Drainage of pelvic cavity, percutaneous approach).

ICD-10-PCS procedure code 0W9J3ZX is currently recognized as an O.R. procedure for purposes of MS-DRG assignment, while the nondiagnostic ICD-10-PCS procedure code 0W9J3ZZ is not recognized as an O.R. procedure for purposes of MS-DRG assignment. The requestor stated that percutaneous drainage procedures of the pelvic cavity for both diagnostic and nondiagnostic purposes are not complex procedures and both types of procedures are usually performed in a radiology suite. The requestor stated that both procedures should be classified as non-O.R. procedures.

We agree with the requestor that these procedures do not typically require the resources of an operating room. Therefore, we are proposing to remove procedure code 0W9J3ZX from the FY 2020 ICD-10 MS-DRG Version 37 Definitions Manual in Appendix E—Operating Room Procedures and Procedure Code/MS-DRG Index as an O.R. procedure. Under this proposal, this procedure would no longer impact MS-DRG assignment.

(3) Percutaneous Removal of Drainage Device

One requestor identified two ICD-10-PCS procedure codes that describe procedures involving the percutaneous placement and removal of drainage devices from the pancreas. These two ICD-10-PCS procedure codes are: 0FPG30Z (Removal of drainage device from pancreas, percutaneous approach) and 0F9G30Z (Drainage of pancreas with drainage device, percutaneous approach). ICD-10-PCS procedure code 0FPG30Z is currently recognized as an O.R. procedure for purposes of MS-DRG assignment, while ICD-10-PCS procedure code 0F9G30Z is not recognized as an O.R. procedure for purposes of MS-DRG assignment. The requestor stated that percutaneous placement of drains is typically performed in a radiology suite under image guidance and removal of a drain would not be more resource intensive than its placement.

We agree with the requestor that these procedures do not typically require the resources of an operating room. Therefore, we are proposing to remove ICD-10-PCS procedure code 0FPG30Z from the FY 2020 ICD-10 MS-DRG Version 37 Definitions Manual in Appendix E—Operating Room Procedures and Procedure Code/MS-DRG Index as an O.R. procedure. Under this proposal, this procedure would no longer impact MS-DRG assignment.

c. Non-O.R. Procedures to O.R. Procedures

(1) Percutaneous Occlusion of Gastric Artery

One requestor identified two ICD-10-PCS procedure codes that describe percutaneous occlusion and restriction of the gastric artery with intraluminal device, ICD-10-PCS procedure codes 04L23DZ (Occlusion of gastric artery with intraluminal device, percutaneous approach) and 04V23DZ (Restriction of gastric artery with intraluminal device, percutaneous approach), that the requestor stated are currently not recognized as O.R. procedures for purposes of MS-DRG assignment. The requestor noted that transcatheter endovascular embolization of the gastric artery with intraluminal devices uses comparable resources to transcatheter endovascular embolization of the gastroduodenal artery. The requestor stated that ICD-10-PCS procedure codes 04L33DZ (Occlusion of hepatic Start Printed Page 19232artery with intraluminal device, percutaneous approach) and 04V33DZ (Restriction of hepatic artery with intraluminal device, percutaneous approach) are recognized as O.R. procedures for purposes of MS-DRG assignment, and ICD-10-PCS procedure codes 04L23DZ and 04V23DZ should therefore also be recognized as O.R. procedures for purposes of MS-DRG assignment. We note that, contrary to the requestor's statement, ICD-10-PCS procedure code 04V23DZ is already recognized as an O.R. procedure for purposes of MS-DRG assignment.

We agree with the requestor that ICD-10-PCS procedure code 04L23DZ typically requires the resources of an operating room. Therefore, we are proposing to add this code to the FY 2020 ICD-10 MS-DRG Version 37 Definitions Manual in Appendix E—Operating Room Procedures and Procedure Code/MS-DRG Index as an O.R. procedure assigned to MS-DRGs 270, 271, and 272 (Other Major Cardiovascular Procedures with MCC, CC, without CC/MCC, respectively) in MDC 05 (Diseases and Disorders of the Circulatory System); MS-DRGs 356, 357, and 358 (Other Digestive System O.R. Procedures, with MCC, CC, without CC/MCC, respectively) in MDC 06 (Diseases and Disorders of the Digestive System); MS-DRGs 907, 908, and 909 (Other O.R. Procedures for Injuries with MCC, CC, without CC/MCC, respectively) in MDC 21 (Injuries, Poisonings and Toxic Effects of Drugs); and MS-DRGs 957, 958, and 959 (Other O.R. Procedures for Multiple Significant Trauma with MCC, CC, without CC/MCC, respectively) in MDC 24 (Multiple Significant Trauma).

(2) Endoscopic Insertion of Endobronchial Valves

In the FY 2019 IPPS/LTCH PPS final rule (83 FR 41257), we discussed a comment we received in response to the FY 2019 IPPS/LTCH PPS proposed rule regarding eight ICD-10-PCS procedure codes that describe endobronchial valve procedures that the commenter believed should be designated as O.R. procedures. The codes are identified in the following table.

ICD-10-PCS codeCode description
0BH38GZInsertion of endobronchial valve into right main bronchus, via natural or artificial opening endoscopic.
0BH48GZInsertion of endobronchial valve into right upper lobe bronchus, via natural or artificial opening endoscopic.
0BH58GZInsertion of endobronchial valve into right middle lobe bronchus, via natural or artificial opening endoscopic.
0BH68GZInsertion of endobronchial valve into right lower lobe bronchus, via natural or artificial opening endoscopic.
0BH78GZInsertion of endobronchial valve into left main bronchus, via natural or artificial opening endoscopic.
0BH88GZInsertion of endobronchial valve into left upper lobe bronchus, via natural or artificial opening endoscopic.
0BH98GZInsertion of endobronchial valve into lingula bronchus, via natural or artificial opening endoscopic.
0BHB8GZInsertion of endobronchial valve into left lower lobe bronchus, via natural or artificial opening endoscopic.

The commenter stated that these procedures are most commonly performed in the O.R., given the need for better monitoring and support through the process of identifying and occluding a prolonged air leak using endobronchial valve technology. The commenter also noted that other endobronchial valve procedures have an O.R. designation. We noted that, in the ICD-10 MS-DRGs Version 35, these eight ICD-10-PCS procedure codes are not recognized as O.R. procedures for purposes of MS-DRG assignment. The commenter requested that these eight procedure codes be assigned to MS-DRG 163 (Major Chest Procedures with MCC) due to similar cost and resource use. As discussed in the FY 2019 IPPS/LTCH PPS final rule, our clinical advisors disagreed with the commenter that the eight identified procedures typically require the use of an operating room, and believed that these procedures would typically be performed in an endoscopy suite. Therefore, we did not finalize a change to the eight procedure codes describing endoscopic insertion of an endobronchial valve listed in the table above for FY 2019 under the ICD-10 MS-DRGs Version 36.

After publication of the FY 2019 IPPS/LTCH PPS final rule, we received feedback from several stakeholders expressing continued concern with the designation of the eight ICD-10-PCS procedure codes describing the endoscopic insertion of an endobronchial valve listed in the table above, including requests to reconsider the designation of these codes for FY 2020. Some requestors stated that while they appreciated CMS' attention to the issue, they believed that important clinical and financial factors had been overlooked. The requestors noted that while the site of care is an important consideration for MS-DRG assignment, there are other clinical factors such as case complexity, patient health risk and the need for anesthesia that also affect hospital resource consumption and should influence MS-DRG assignment. With regard to complexity, the requestors stated that many of these patients are high-risk, often recovering from major lung surgery and have significantly compromised respiratory function. According to one requestor, these patients may have major comorbidities, such as cancer or emphysema contributing to longer lengths of stay in the hospital. This requestor acknowledged that procedures performed for the endoscopic insertion of an endobronchial valve are often, but not always, performed in the O.R., however, the requestor also noted this should not preclude the designation of these procedures as O.R. procedures since there have been other examples of reclassification requests where the combination of factors, such as treatment difficulty, resource utilization, patient health status, and anesthesia administration were considered in the decision to change the designation for a procedure from non-O.R. to O.R. Another requestor stated that CMS' current designation of a procedure involving the endoscopic insertion of an endobronchial valve as a non-O.R. procedure is not reflective of actual practice and this designation has payment consequences that may affect access to the treatment for a vulnerable patient population, with limited treatment options. The requestor recommended that procedures involving the endoscopic insertion of an endobronchial valve should be designated as O.R. procedures and assigned to MS-DRGs 163, 164, and 165 (Major Chest Procedures with MCC, with CC and without CC/MCC, respectively). In addition, a few of the requestors also conducted their own analyses and indicated that if procedures involving the endoscopic insertion of an endobronchial valve were to be assigned to MS-DRGs 163, 164, and 165, the average costs of the cases reporting a procedure code describing the endoscopic insertion of an endobronchial valve would still be higher compared to all the cases in the assigned MS-DRG.

We examined claims data from the September 2018 update of the FY 2018 MedPAR file for MS-DRGs 163, 164 and Start Printed Page 19233165 to identify cases reporting any one of the eight procedure codes listed in the above table describing the endoscopic insertion of an endobronchial valve. Cases reporting one of these procedure codes would be assigned to MS-DRG 163, 164, or 165 if at least one other procedure that is designated as an O.R. procedure and assigned to these MS-DRGs was also reported on the claim. In addition, cases reporting a procedure code describing the endoscopic insertion of an endobronchial valve with a different surgical approach are assigned to MS-DRGs 163, 164, and 165. Our findings are shown in the following table.

MS-DRGs for Major Chest Procedures With Endoscopic Insertion of Endobronchial Valve Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 163—All cases10,81211.6$33,433
MS-DRG 163—Cases reporting a procedure for the endoscopic insertion of an endobronchial valve4921.153,641
MS-DRG 164—All cases14,8005.618,202
MS-DRG 164—Cases reporting a procedure for the endoscopic insertion of an endobronchial valve231437,287
MS-DRG 165—All cases7,9073.313,408
MS-DRG 165—Cases reporting a procedure for the endoscopic insertion of an endobronchial valve318.339,249

We found a total of 10,812 cases in MS-DRG 163 with an average length of stay of 11.6 days and average costs of $33,433. Of those 10,812 cases, we found 49 cases reporting a procedure for the endoscopic insertion of an endobronchial valve with an average length of stay of 21.1 days and average costs of $53,641. For MS-DRG 164, we found a total of 14,800 cases with an average length of stay of 5.6 days and average costs of $18,202. Of those 14,800 cases, we found 23 cases reporting a procedure for the endoscopic insertion of an endobronchial valve with an average length of stay of 14 days and average costs of $37,287. For MS-DRG 165, we found a total of 7,907 cases with an average length of stay of 3.3 days and average costs of $13,408. Of those 7,907 cases, we found 3 cases reporting a procedure for the endoscopic insertion of an endobronchial valve with an average length of stay of 18.3 days and average costs of $39,249.

We also examined claims data to identify any cases reporting any one of the eight procedure codes listed in the table above describing the endoscopic insertion of an endobronchial valve within MS-DRGs 166, 167, and 168 (Other Respiratory System O.R. Procedures with MCC, with CC, and without CC/MCC, respectively). Cases reporting one of these procedure codes would be assigned to MS-DRG 166, 167, or 168 if at least one other procedure that is designated as an O.R. procedure and assigned to these MS-DRGs was also reported on the claim. In addition, MS-DRGs 166, 167, and 168 are the other surgical MS-DRGs where cases reporting a respiratory diagnosis within MDC 4 would be assigned. Our findings are shown in the following table.

MS-DRGs for Other Respiratory System O.R. Procedures With Endoscopic Insertion of Endobronchial Valve

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 166—All cases16,05010.6$26,645
MS-DRG 166—Cases reporting a procedure for the endoscopic insertion of an endobronchial valve1125.771,700
MS-DRG 167—All cases8,1655.313,687
MS-DRG 167—Cases reporting a procedure for the endoscopic insertion of an endobronchial valve41028,847
MS-DRG 168—All cases2,4302.89,645

We found a total of 16,050 cases in MS-DRG 166 with an average length of stay of 10.6 days and average costs of $26,645. Of those 16,050 cases, we found 11 cases reporting a procedure for the endoscopic insertion of an endobronchial valve with an average length of stay of 25.7 days and average costs of $71,700. For MS-DRG 167, we found a total of 8,165 cases with an average length of stay of 5.3 days and average costs of $13,687. Of those 8,165 cases, we found 4 cases reporting a procedure for the endoscopic insertion of an endobronchial valve with an average length of stay of 10 days and average costs of $28,847. For MS-DRG 168, we found a total of 2,430 cases with an average length of stay of 2.8 days and average costs of $9,645. Of those 2,430 cases, we did not find any cases reporting a procedure for the endoscopic insertion of an endobronchial valve.

The results of our data analysis indicate that cases reporting a procedure for the endoscopic insertion of an endobronchial valve in MS-DRGs 163, 164, 165, 166, and 167 have a longer length of stay and higher average costs when compared to all the cases in their assigned MS-DRG. Because the data are based on surgical MS-DRGs 163, 164, 165, 166 and 167, and the procedure codes for endoscopic insertion of an endobronchial valve are currently designated as non-O.R. procedures, there was at least one other O.R. procedure reported on the claim resulting in case assignment to one of those MS-DRGs. Our clinical advisors indicated that because there was another O.R. procedure reported, the insertion of the endobronchial valve procedure may or may not have been Start Printed Page 19234the main determinant of resource use for those cases. Therefore, we conducted further analysis to evaluate cases for which no other O.R. procedure was performed with the endoscopic insertion of an endobronchial valve and case assignment resulted in a medical MS-DRG. Our findings are shown in the following table.

Medical MS-DRGs With Insertion of Endobronchial Valve Procedures

MS-DRGNumber of casesAverage length of stayAverage costs
MS-DRG 069 (Transient Ischemia without Thrombolytic)19$26,002
MS-DRG 177 (Respiratory Infections and Inflammations with MCC)1119.533,877
MS-DRG 178 (Respiratory Infections and Inflammations with CC)410.820,109
MS-DRG 180 (Respiratory Neoplasms with MCC)211.519,273
MS-DRG 181 (Respiratory Neoplasms with MCC)1312,641
MS-DRG 186 (Pleural Effusion with MCC)1823,609
MS-DRG 187 (Pleural Effusion with CC)11849,214
MS-DRG 189 (Pulmonary Edema and Respiratory Failure)213.565,431
MS-DRG 190 (Chronic Obstructive Pulmonary Disease with MCC)2939,925
MS-DRG 191 (Chronic Obstructive Pulmonary Disease with CC)11555,958
MS-DRG 192 (Chronic Obstructive Pulmonary Disease without CC/MCC)1510,394
MS-DRG 193 (Simple Pneumonia and Pleurisy with MCC)11827,182
MS-DRG 197 (Interstitial Lung Disease with CC)11211,458
MS-DRG 199 (Pneumothorax with MCC)2816.438,384
MS-DRG 200 (Pneumothorax with CC)118.320,764
MS-DRG 201 (Pneumothorax without CC/MCC)21020,243
MS-DRG 205 (Other Respiratory System Diagnoses with MCC)24.510,851
MS-DRG 207 (Respiratory System Diagnosis with Ventilation Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))42067,299
MS-DRG 208 (Respiratory System Diagnosis with Ventilation Support ≦96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO))813.632,533
MS-DRG 815 (Reticuloendothelial and Immunity Disorders with CC)1517,379
MS-DRG 871 (Septicemia or Severe Sepsis without Mechanical Ventilation >96 Hours with MCC)31539,706
MS-DRG 919 (Complications of Treatment with MCC)2536,143
MS-DRG 920 (Complications of Treatment with CC)1514,923
Total9113.733,377

The data indicate that there is a wide variation in the average length of stay and average costs for cases reporting a procedure for the endoscopic insertion of an endobronchial valve, with volume generally low across MS-DRGs. As shown in the table, for several of the medical MS-DRGs, there was only one case reporting a procedure for the endoscopic insertion of an endobronchial valve. The highest volume of cases reporting a procedure for the endoscopic insertion of an endobronchial valve was found in MS-DRG 199 (Pneumothorax with MCC) with a total of 28 cases with an average length of stay of 16.4 days and average costs of $38,384. The highest average costs and longest average length of stay for cases reporting a procedure for the endoscopic insertion of an endobronchial valve was $67,299 in MS-DRG 207 (Respiratory System Diagnosis with Ventilator Support >96 Hours or Peripheral Extracorporeal Membrane Oxygenation (ECMO)) where 4 cases were found with an average length of stay of 20 days. Overall, there was a total of 91 cases reporting the insertion of an endobronchial valve procedure with an average length of stay of 13.7 days and average costs of $33,377 across the medical MS-DRGs.

Our clinical advisors agree that the subset of patients who undergo endoscopic insertion of an endobronchial procedure are complex and may have multiple comorbidities such as severe underlying lung disease that impact the hospital length of stay. They also believe that, as we begin the process of refining how procedure codes may be classified under ICD-10-PCS, including designation of a procedure as O.R. or non-O.R., we should take into consideration whether the procedure is driving resource use for the admission. (We refer the reader to section II.F.13.a. of the preamble of this proposed rule for the discussion of our plans to conduct a comprehensive review of the ICD-10-PCS procedure codes). Based on the claims data analysis, which show a wide variation in average costs for cases reporting endoscopic insertion of an endobronchial valve without an O.R. procedure, our clinical advisors are not convinced that endoscopic insertion of an endobronchial valve is a key contributing factor to the consumption of resources as reflected in the data. They also believe, in review of the procedures that are currently assigned to MS-DRGs 163, 164, 165, 166, 167, and 168, that further refinement of these MS-DRGs may be warranted. For these reasons, at this time, our clinical advisors do not support designating endoscopic insertion of an endobronchial valve as an O.R. procedure, nor do they support assignment of these procedures to MS-DRGs 163, 164, and 165 until additional analyses can be performed for this subset of patients as part of the comprehensive procedure code review.

For the reasons described above, we are not proposing to change the current non-O.R. designation of the eight ICD-10-PCS procedure codes that describe endoscopic insertion of an endobronchial valve. However, because we agree that endoscopic insertion of an endobronchial valve procedures are performed on clinically complex patients, we believe it may be appropriate to consider designating these procedures as non-O.R. affecting specific MS-DRGs for FY 2020. Therefore, we are requesting public comment on designating these procedure codes as non-O.R. procedures affecting the MS-DRG assignment, including the specific MS-DRGs that cases reporting the endoscopic insertion Start Printed Page 19235of an endobronchial valve should affect for FY 2020. As noted, it is not clear based on the claims data to what degree the endoscopic insertion of an endobronchial valve is a contributing factor for the consumption of resources for these clinically complex patients and given the potential refinement that may be needed for MS-DRGs 163, 164, 165, 166, 167, and 168, we are soliciting comment on whether cases reporting the endoscopic insertion of an endobronchial valve should affect any of these MS-DRGs or other MS-DRGs.

14. Proposed Changes to the MS-DRG Diagnosis Codes for FY 2020

a. Background of the CC List and the CC Exclusions List

Under the IPPS MS-DRG classification system, we have developed a standard list of diagnoses that are considered CCs. Historically, we developed this list using physician panels that classified each diagnosis code based on whether the diagnosis, when present as a secondary condition, would be considered a substantial complication or comorbidity. A substantial complication or comorbidity was defined as a condition that, because of its presence with a specific principal diagnosis, would cause an increase in the length-of-stay by at least 1 day in at least 75 percent of the patients. However, depending on the principal diagnosis of the patient, some diagnoses on the basic list of complications and comorbidities may be excluded if they are closely related to the principal diagnosis. In FY 2008, we evaluated each diagnosis code to determine its impact on resource use and to determine the most appropriate CC subclassification (non-CC, CC, or MCC) assignment. We refer readers to sections II.D.2. and 3. of the preamble of the FY 2008 IPPS final rule with comment period for a discussion of the refinement of CCs in relation to the MS-DRGs we adopted for FY 2008 (72 FR 47152 through 47171).

b. Overview of Comprehensive CC/MCC Analysis

In the FY 2008 IPPS/LTCH PPS final rule (72 FR 47159), we described our process for establishing three different levels of CC severity into which we would subdivide the diagnosis codes. The categorization of diagnoses as an MCC, a CC, or a non-CC was accomplished using an iterative approach in which each diagnosis was evaluated to determine the extent to which its presence as a secondary diagnosis resulted in increased hospital resource use. We refer readers to the FY 2008 IPPS/LTCH PPS final rule (72 FR 47159) for a complete discussion of our approach. Since this comprehensive analysis was completed for FY 2008, we have evaluated diagnosis codes individually when receiving requests to change the severity level of specific diagnosis codes. However, given the transition to ICD-10-CM and the significant changes that have occurred to diagnosis codes since this review, we believe it is necessary to conduct a comprehensive analysis once again. We have completed this analysis and we are discussing our findings in this proposed rule. We used the same methodology utilized in FY 2008 to conduct this analysis, as described below.

For each secondary diagnosis, we measured the impact in resource use for the following three subsets of patients:

(1) Patients with no other secondary diagnosis or with all other secondary diagnoses that are non-CCs.

(2) Patients with at least one other secondary diagnosis that is a CC but none that is an MCC.

(3) Patients with at least one other secondary diagnosis that is an MCC.

Numerical resource impact values were assigned for each diagnosis as follows:

ValueMeaning
0Significantly below expected value for the non-CC subgroup.
1Approximately equal to expected value for the non-CC subgroup.
2Approximately equal to expected value for the CC subgroup.
3Approximately equal to expected value for the MCC subgroup.
4Significantly above the expected value for the MCC subgroup.

Each diagnosis for which Medicare data were available was evaluated to determine its impact on resource use and to determine the most appropriate CC subclass (non-CC, CC, or MCC) assignment. In order to make this determination, the average cost for each subset of cases was compared to the expected cost for cases in that subset. The following format was used to evaluate each diagnosis:

CodeDiagnosisCnt1C1Cnt2C2Cnt3C3

Count (Cnt) is the number of patients in each subset and C1, C2, and C3 are a measure of the impact on resource use of patients in each of the subsets. The C1, C2, and C3 values are a measure of the ratio of average costs for patients with these conditions to the expected average cost across all cases. The C1 value reflects a patient with no other secondary diagnosis or with all other secondary diagnoses that are non-CCs. The C2 value reflects a patient with at least one other secondary diagnosis that is a CC but none that is a major CC. The C3 value reflects a patient with at least one other secondary diagnosis that is a major CC. A value close to 1.0 in the C1 field would suggest that the code produces the same expected value as a non-CC diagnosis. That is, average costs for the case are similar to the expected average costs for that subset and the diagnosis is not expected to increase resource usage. A higher value in the C1 (or C2 and C3) field suggests more resource usage is associated with the diagnosis and an increased likelihood that it is more like a CC or major CC than a non-CC. Thus, a value close to 2.0 suggests the condition is more like a CC than a non-CC but not as significant in resource usage as an MCC. A value close to 3.0 suggests the condition is expected to consume resources more similar to an MCC than a CC or non-CC. For example, a C1 value of 1.8 for a secondary diagnosis means that for the subset of patients who have the secondary diagnosis and have either no other secondary diagnosis present, or all the other secondary diagnoses present are non-CCs, the impact on resource use of the secondary diagnoses is greater than the expected value for a non-CC by an amount equal to 80 percent of the difference between the expected value of a CC and a non-CC (that is, the impact on resource use of the secondary diagnosis is closer to a CC than a non-CC).

These mathematical constructs are used as guides in conjunction with the judgment of our clinical advisors to classify each secondary diagnosis reviewed as an MCC, a CC, or a non-CC. Our clinical advisors reviewed the resource use impact reports and suggested modifications to the initial CC subclass assignments when clinically appropriate.

c. Proposed Changes to Severity Levels

(1) Summary of Proposed Changes

The diagnosis codes for which we are proposing a change in severity level designation as a result of the analysis Start Printed Page 19236described in this proposed rule are shown in Table 6P.1c. (which is available via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html). Using the method described above to perform our comprehensive CC/MCC analysis, our clinical advisors recommended a change in the severity level designation for 1,492 ICD-10-CM diagnosis codes. As shown in Table 6P.1c. associated with this proposed rule, the proposed changes to severity level resulting from our comprehensive analysis would move some diagnosis codes to a higher severity level designation and other diagnosis codes to a lower severity level designation, as indicated in the two columns which display CMS' FY 2019 classification in column C and the proposed changes for FY 2020 in column D.

The table below shows the Version 36 ICD-10 MS-DRG categorization of diagnosis codes by severity level.

Current Categorization of CC Codes

[Version 36]

Number of codes
MCC3,244
CC14,528
Non-CC54,160
Total71,932

The following table compares the Version 36 ICD-10 MS-DRG CC list and the proposed Version 37 ICD-10 MS-DRG CC list. There are 17,772 diagnosis codes on the Version 36 MCC/CC lists. The proposed MCC/CC severity level changes would reduce the number of diagnosis codes on the MCC/CC lists to 16,790 (3,099 + 13,691). Based on the Version 36 MCC/CC lists, 81.5 percent of cases have at least one MCC/CC present, using claims data from the September 2018 update of the FY 2018 MedPAR file. Based on the proposed Version 37 MCC/CC lists, the percent of cases having at least one MCC/CC present would be reduced to 76.6 percent.

Comparison of Current CC List and Proposed CC List

Current CC ListProposed CC List
Codes designated as an MCC3,2443,099
Percent of cases with one or more MCCs41.0%36.3%
Average charge of cases with one or more MCCs$16,439$16,490
Codes designated as a CC14,52813,691
Percent of cases with one or more CCs40.5%40.3%
Average charge of cases with one or more CCs$10,332$10,518
Codes designated as non-CC54,16055,142
Percent of cases with no CC18.5%23.4%
Average charge of cases with no CCs$9,885$10,166

Using the method described above to perform our comprehensive analysis, we are proposing to modify the Version 36 CC subclass assignments for 2.1 percent of the ICD-10-CM diagnosis codes, as summarized in the table below.

Proposed MCC/CC Subclass Modifications

Severity level—CC subclassVersion 36 severity level number of codesProposed version 37 severity level number of codesPercent changeProposed version 37 change to MCC subclass, number of codesProposed version 37 change to CC subclass, number of codesProposed Version 37 change to non-CC subclass, number of codes
MCC3,2443,099−4.5N/A13617
CC14,52813,691−5.88N/A1,148
Non-CC54,16055,1421.80183N/A
Total71,93271,932N/A83191,166

As a result of these proposed changes, of the 71,932 diagnosis codes included in the analysis, the net result would be a decrease of 145 (3,244-3,099) codes designated as an MCC, a decrease of 837 (14,528−13,691) codes designated as a CC, and an increase of 982 (55,142-54,160) codes designated as a non-CC.

(2) Illustrations of Proposed Severity Level Changes

As noted above, based on our comprehensive CC/MCC analysis as described previously in this section, we are proposing changes in the severity level designations for 1,492 ICD-10-CM diagnosis codes, and the specific proposed changes to severity level designations for those diagnosis codes are shown in Table 6P.1.c. associated with this proposed rule (which is available via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html). Below we provide illustrative examples of certain categories of codes for which we are proposing changes to the severity level designations as a result of our comprehensive analysis. As described above, these proposals are based on review of the data as well as consideration of the clinical nature of each of the secondary diagnoses and the severity level of clinically similar diagnoses. The first set of codes, from the Neoplasms chapter, encompasses more than half of all proposed severity level changes. The additional examples are from a variety of body systems and conditions, and they are illustrative of both proposed increases and proposed decreases in severity level designation. We note that we are making available a Start Printed Page 19237supplementary file containing the data describing the impact on resource use when reported as a secondary diagnosis for all 1,492 ICD-10-CM diagnosis codes for which we are proposing a change in designation via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html.

(a) Neoplasms Chapter Codes

Of the total number of ICD-10-CM diagnosis codes for which we are proposing a change of severity level designation, 767 are from the Neoplasms chapter of the ICD-10-CM classification (C00-D49) and are currently designated as a CC. We note that the Neoplasms chapter contains a total of 1,661 ICD-10-CM diagnosis codes. In Version 36 of the MS-DRGs, none of the 1,661 neoplasm codes are designated as an MCC, 767 are designated as a CC, and 894 are designated as a non-CC. For all 767 codes currently designated as a CC, our clinical advisors recommended changing the severity level designation from CC to non-CC. The following table presents examples of some of the neoplasm codes for which we are proposing a severity level change to non-CC, and their impact on resource use when reported as a secondary diagnosis. As noted previously, the data analysis for the remainder of these neoplasm codes is included in the supplementary file that we are making available on the CMS website.

Proposed Severity Level Changes for Neoplasm Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
C20 (Malignant neoplasm of rectum)2,9601.04857,5612.21696,4923.0790CCNon-CC.
C22.0 (Liver cell carcinoma)1,6721.22899,4442.063812,5033.0914CCNon-CC.
C25.0 (Malignant neoplasm of head of pancreas)1,2051.13573,8342.17886,1913.0229CCNon-CC.
C64.1 (Malignant neoplasm of right kidney, except renal pelvis)1,5121.22764,4632.16004,5933.1158CCNon-CC.
C64.2 (Malignant neoplasm of left kidney, except renal pelvis)1,3681.34074,5172.19474,5933.0947CCNon-CC.
C78.01 (Secondary malignant neoplasm of right lung)4,1491.041714,9462.088820,3243.0043CCNon-CC.
C78.02 (Secondary malignant neoplasm of left lung)3,5991.007813,4562.085318,3843.0024CCNon-CC.
C79.31 (Secondary malignant neoplasm of brain)7,1641.189522,9892.133041,3872.9116CCNon-CC.
C79.51 (Secondary malignant neoplasm of bone)26,0951.304888,0222.202099,6703.0449CCNon-CC.
C90.00 (Multiple myeloma not having achieved remission)9,9471.158834,1552.214433,8303.1281CCNon-CC.

As described in section II.F.15.b. of the preamble of this proposed rule, we examined the impact in resource use for three subsets of patients in order to evaluate the severity level designations for each secondary diagnosis. In the table above, the C1 values are generally close to 1, C2 values are generally close to 2, and C3 values are generally close to 3. As explained in section II.F.15.b. of the preamble of this proposed rule, these values suggest that when a neoplasm is reported as a secondary diagnosis, the resources involved in caring for a patient with this condition are more aligned with a non-CC severity level than a CC severity level. Our clinical advisors reviewed these data and believe the resources involved in caring for a patient with this condition are more aligned with a non-CC severity level. Our clinical advisors noted that when a neoplasm is reported as a secondary diagnosis, because it is not the condition that occasioned the patient's admission to the hospital, it does not significantly impact resource use. Our clinical advisors noted that if these patients are admitted for treatment of the neoplasm, the neoplasm is the principal diagnosis, and other complicating or comorbid conditions reported as secondary diagnoses would determine the appropriate severity level designation for each particular case. For example, if a patient is admitted for resection of malignant neoplasm of the right kidney, ICD-10-CM diagnosis code C64.1 (Malignant neoplasm of right kidney, except renal pelvis) is reported as the principal diagnosis, and any complicating conditions reported as secondary diagnoses during the hospital stay would determine the appropriate severity level designation for the case.

(b) Diseases of the Circulatory System Chapter Codes

In the Diseases of the Circulatory System chapter of the ICD-10-CM diagnosis classification (I00-I99), based on the results of our comprehensive review, we are proposing to change the severity level designation for 13 ICD-10-CM diagnosis codes from categories I21 (Acute myocardial infarction) and I22 (Subsequent ST elevation (STEMI) and non-ST elevation (NSTEMI) myocardial infarction) from an MCC to a CC.

The following table contains the ICD-10-CM diagnosis codes for which we are proposing a severity level change, and their impact on resource use when reported as a secondary diagnosis.Start Printed Page 19238

Proposed Severity Level Changes for Myocardial Infarction Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
I21.01 (ST elevation (STEMI) myocardial infarction involving left main coronary artery)21.2010172.9902383.0195MCCCC.
I21.02 (ST elevation (STEMI) myocardial infarction involving left anterior descending coronary artery)1490.93263221.65657543.3157MCCCC.
I21.09 (ST elevation (STEMI) myocardial infarction involving other coronary artery of anterior wall)5831.22011,2882.22253,7443.1094MCCCC.
I21.11 (ST elevation (STEMI) myocardial infarction involving right coronary artery)1751.84863262.08675813.1141MCCCC.
I21.19 (ST elevation (STEMI) myocardial infarction involving other coronary artery of inferior wall)9131.50541,9402.26414,0813.1996MCCCC.
I21.21 (ST elevation (STEMI) myocardial infarction involving left circumflex coronary artery)300.9445562.41601172.9965MCCCC.
I21.29 (ST elevation (STEMI) myocardial infarction involving other sites)1621.01434172.24011,0483.3341MCCCC.
I21.3 (ST elevation (STEMI) myocardial infarction of unspecified site)1,2711.65873,8762.242010,1683.2432MCCCC.
I22.0 (Subsequent ST elevation (STEMI) myocardial infarction of anterior wall)100.9199741.25581652.6794MCCCC.
I22.1 (Subsequent ST elevation (STEMI) myocardial infarction of inferior wall)40.0000811.60221433.3056MCCCC.
I22.2 (Subsequent non-ST elevation (NSTEMI) myocardial infarction)942.10343522.12911,9163.0157MCCCC.
I22.8 (Subsequent ST elevation (STEMI) myocardial infarction of other sites)52.2963182.0589533.1306MCCCC.
I22.9 (Subsequent ST elevation (STEMI) myocardial infarction of unspecified site)271.7140871.87372932.9627MCCCC.

As shown in the table above, all of these myocardial infarction codes are currently assigned as MCCs. As explained earlier, values close to 2.0 in column C1 suggest that the condition is more like a CC than a non-CC but not as significant in resource usage as an MCC. The C1 values for the secondary diagnoses with the largest number of cases in this subset in the table above, ICD-10-CM codes I21.3 and I21.19, are closer to 2.0 than to 1.0, indicating that these secondary diagnoses are more aligned with a CC than either a non-CC or an MCC. Therefore, the data suggest that for patients for whom any of the myocardial infarction codes listed in the table above is reported as a secondary diagnosis, the resources involved in their care are not aligned with those of an MCC. Our clinical advisors reviewed these data and believe that the resources involved in caring for a patient with this condition are aligned with a CC. Patients with a secondary diagnosis of myocardial infarction may require additional diagnostic imaging, monitoring, medications, and additional interventions, thereby consuming resources that are consistent with CC status. Our clinical advisors noted that while, for certain codes, the number of cases shown in the data may not be sufficient to reliably indicate impact on resource use as a secondary diagnosis, these codes are clinically similar to other codes for which the data are sufficient to indicate impact on resource use. Because our clinical advisors believe that it is appropriate to ensure consistency across codes describing similar diagnoses, we are proposing to reassign the severity level for all of the codes in the table above from an MCC to a CC.

(c) Diseases of the Skin and Subcutaneous Tissue Chapter Codes

In the Diseases of the Skin and Subcutaneous Tissue chapter of the ICD-10-CM diagnosis classification (L00-L99), based on the results of our comprehensive review, we are proposing a change to the severity level for 150 ICD-10-CM diagnosis codes describing pressure ulcers. Pressure ulcers, which are also known as pressure injuries, involve damage to the skin and soft tissue. They may result from prolonged pressure over a bony prominence or result from a medical device. The ICD-10-CM classification includes 150 diagnosis codes that describe pressure ulcers across various anatomical regions and across the various possible stages (stages 1 through 4, unspecified stage, and unstageable). These codes are listed in Table 6P.1.d. associated with this proposed rule (which is available via the internet on the CMS website at: http://www.cms.hhs.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html). In the course of our comprehensive review of the CC/MCC lists, our clinical advisors reviewed the current categorization of pressure ulcers, which designate all stage 3 and 4 pressure ulcers as MCCs, while stage 1, stage 2, unspecified stage, Start Printed Page 19239and unstageable pressure ulcers are currently designated as non-CCs.

Our clinical advisors reviewed data on the relative contribution to the overall cost of hospital care for all stages of pressure ulcers coded as secondary diagnoses, and found (1) that there was little difference in the cost contribution regardless of stage, and (2) the cost contributions (cost weights) of all stages supported a designation of CC rather than MCC (for stage 3 and 4 ulcers), and CC rather than non-CC (for stages 1, 2, unspecified, and unstageable). Our clinical advisors noted that the apparent similar contribution of all pressure ulcer stages can be explained by the fact that pressure ulcers occur in patients with serious underlying illness, such as stroke, cancer, dementia, and end-stage cardiac or pulmonary disease that can result in multiple factors (frailty, immobility, paralysis, malnutrition, and general debility) that predispose them to pressure ulcers. It is the serious underlying illness and debilitated state that causes the pressure ulcer that is the primary driver of resource use. Although a pressure ulcer at any stage requires care and preventive measures that make additional contributions to the overall cost of care, our clinical advisors believe that the fact that the ulcer developed in the first place is more important than the stage of the ulcer itself in determining the impact on the costs of hospitalization. The presence of a pressure ulcer may indicate an increase in resource use, but that increase is similar regardless of the stage of the ulcer.

The following table contains illustrations of pressure ulcer codes and their impact on resource use when reported as a secondary diagnosis. We selected secondary diagnosis codes describing pressure ulcer of the sacrum as examples because they account for almost half of all instances of pressure ulcers reported as secondary diagnoses, but note that the data for the codes describing pressure ulcer of other body parts generally show a similar pattern. As noted previously, the data analysis for the remainder of the pressure ulcer codes for which we are proposing a change in severity level designation is included in the supplementary file that we are making available on the CMS website.

Proposed Severity Level Changes for Pressure Ulcer Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
L89.150 (Pressure ulcer of sacral region, unstageable)6052.0036,2472.56024,0473.254Non-CCCC.
L89.151 (Pressure ulcer of sacral region, stage 1)2,3741.69116,6882.40436,4283.182Non-CCCC.
L89.152 (Pressure ulcer of sacral region, stage 2)4,2381.73735,6082.49795,8323.274Non-CCCC.
L89.153 (Pressure ulcer of sacral region, stage 3)1,7221.83215,2662.52248,4143.289MCCCC.
L89.154 (Pressure ulcer of sacral region, stage 4)1,2371.75514,3062.43856,6193.196MCCCC.
L89.159 (Pressure ulcer of sacral region, unspecified stage)1,4531.38712,4662.31135,0203.176Non-CCCC.

As explained previously, a value in column C1 that is close to 2.0 suggests the condition is more like a CC than a non-CC but not as significant in resource usage as an MCC. Given that the values in column C1 in the table above are closer to 2.0 than to 1.0, the data suggest that when pressure ulcers of the sacral region are reported as a secondary diagnosis, the resources involved in caring for these patients are more consistent with a CC than either a non-CC or an MCC. Our clinical advisors reviewed these data and believe that it is appropriate to ensure consistency across codes involving similar diagnoses. Therefore, we are proposing to designate as CCs both the 50 ICD-10-CM diagnosis codes that are currently designated as MCCs and the 100 ICD-10-CM diagnosis codes currently designated as non-CCs.

We note that, under the Hospital-Acquired Condition (HAC) payment provision established by section 5001(c) of the Deficit Reduction Act (DRA) of 2005, hospitals no longer receive additional payment for cases in which one of the selected conditions occurred but was not present on admission (POA). That is, the case is paid as though the condition were not present. The HAC-POA payment provision is applicable for secondary diagnosis code reporting only, as the selected conditions are designated as a CC or an MCC when reported as a secondary diagnosis. For the DRA HAC-POA payment provision, a payment adjustment is only applicable if there are no other CC/MCC conditions reported on the claim. Currently, there are 14 HAC categories subject to the HAC-POA payment provision, one of which is pressure ulcers. The pressure ulcer HAC category (HAC 04) specifically includes diagnosis codes describing a stage 3 or stage 4 pressure ulcer because they are designated as an MCC, as noted earlier in this section. If the proposed severity level designations for the pressure ulcer diagnosis codes are finalized, the 100 ICD-10-CM diagnosis codes describing pressure ulcers currently designated as non-CCs would be subject to the HAC-POA payment provision as CCs when reported as a secondary diagnosis and not POA, effective beginning in FY 2020. The diagnosis codes describing a stage 3 or stage 4 pressure ulcer would continue to be subject to the HAC-POA payment provision as CCs.

In addition, consistent with the proposed changes to the severity level designation of the pressure ulcer codes, we are proposing to revise the title of the HAC 04 category from “Pressure Ulcer—Stages III & IV” to “Pressure Ulcers”. We refer readers to the website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalAcqCond/​index.html for additional information regarding the HAC-POA payment provision under the DRA.

(d) Diseases of the Genitourinary System Chapter Codes

In the Diseases of the Genitourinary System chapter of the ICD-10-CM diagnosis classification (N00-N99), based on the results of our comprehensive analysis, we are proposing to change the severity level designation for eight ICD-10-CM diagnosis codes. For these eight Start Printed Page 19240diagnosis codes, based on their clinical judgment and for the reasons described below, our clinical advisors recommended that we increase the severity level designation from a CC to an MCC for one code, and from a non-CC to a CC for seven codes. The following table contains the Diseases of the Genitourinary System chapter codes that describe conditions for which we are proposing a severity level designation change, and their impact on resource use when reported as a secondary diagnosis.

Proposed Severity Level Changes for Genitourinary Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
N10 (Acute pyelonephritis)5,3850.963920,4761.944426,9293.0413Non-CCCC.
N18.4 (Chronic kidney disease, stage 4 (severe))36,9401.0919219,4822.0679319,8493.0840Non-CCCC.
N18.5 (Chronic kidney disease, stage 5)1,1581.030330,8512.084134,7333.1508Non-CCCC.
N18.6 (End stage renal disease)26,2761.5755578,5872.3010492,7103.2761CCMCC.
N30.00 (Acute cystitis without hematuria)18,5971.057653,8201.940973,9962.8976Non-CCCC.
N30.01 (Acute cystitis with hematuria)4,8720.950316,9491.851424,4222.8070Non-CCCC.
N41.0 (Acute prostatitis)8450.95193,0311.81632,1353.0450Non-CCCC.
N76.4 (Abscess of vulva)3680.82841,2762.09061,0493.1341Non-CCCC.

The C1, C2, and C3 values in the table above are generally close to 1.0, 2.0, and 3.0, respectively, which would indicate that these conditions are more aligned with a non-CC than with either a CC or an MCC. However, our clinical advisors believe that patients with a secondary diagnosis of one of the genitourinary conditions in the table above may consume additional resources, including but not limited to monitoring for hypertension, diagnostic tests, and balancing electrolytes. Patients with end-stage renal disease (ICD-10-CM code N18.6) would typically require dialysis in addition to these resources, which our clinical advisors believe is more aligned with an MCC. Therefore, we are proposing to change the severity level designations for the eight codes as shown in the table above.

e. Injury, Poisoning and Certain Other Consequences of External Causes Chapter Codes

In subcategory S32.5 (Fracture of pubis) of the ICD-10-CM diagnosis classification, based on our comprehensive analysis, we are proposing to change the severity level designation from CC to non-CC for 19 ICD-10-CM diagnosis codes that specify fractures of the pubic bone. The following table contains the diagnosis codes for which we are proposing a severity level designation change, and their impact on resource use when reported as a secondary diagnosis.

Proposed Severity Level Changes, Pubis Fracture Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
S32.501A (Unspecified fracture of right pubis, initial encounter for closed fracture)3931.02341,1712.12158473.0423CCNon-CC.
S32.501K (Unspecified fracture of right pubis, subsequent encounter for fracture with nonunion)11.5125122.114421.8454CCNon-CC.
S32.502A (Unspecified fracture of left pubis, initial encounter for closed fracture)3981.30721,1522.05939143.0028CCNon-CC.
S32.502K (Unspecified fracture of left pubis, subsequent encounter for fracture with nonunion)30.000072.872310.7401CCNon-CC.
S32.509A (Unspecified fracture of unspecified pubis, initial encounter for closed fracture)491.10751562.10661543.1704CCNon-CC.
S32.509K (Unspecified fracture of unspecified pubis, subsequent encounter for fracture with nonunion)00.000013.402212.1306CCNon-CC.
S32.511A (Fracture of superior rim of right pubis, initial encounter for closed fracture)7431.18122,1322.15191,5042.8763CCNon-CC.
S32.511K (Fracture of superior rim of right pubis, subsequent encounter for fracture with nonunion)22.035450.000042.3425CCNon-CC.
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S32.512A (Fracture of superior rim of left pubis, initial encounter for closed fracture)7601.57382,0982.08281,5902.9020CCNon-CC.
S32.512K (Fracture of superior rim of left pubis, subsequent encounter for fracture with nonunion)32.191532.481284.0000CCNon-CC.
S32.519A (Fracture of superior rim of unspecified pubis, initial encounter for closed fracture)152.6829531.5795352.9052CCNon-CC.
S32.519K (Fracture of superior rim of unspecified pubis, subsequent encounter for fracture with nonunion)00.00000.00000.000CCNon-CC.
S32.591A (Other specified fracture of right pubis, initial encounter for closed fracture)2,4271.25246,5132.09704,3972.9930CCNon-CC.
S32.591K (Other specified fracture of right pubis, subsequent encounter for fracture with nonunion)72.7706151.977250.8969CCNon-CC.
S32.592A (Other specified fracture of left pubis, initial encounter for closed fracture)2,4241.36916,6042.09214,9222.9428CCNon-CC.
S32.592K (Other specified fracture of left pubis, subsequent encounter for fracture with nonunion)40.6970242.5574103.0015CCNon-CC.
S32.599A (Other specified fracture of unspecified pubis, initial encounter for closed fracture)1511.67484572.05183943.1844CCNon-CC.
S32.599K (Other specified fracture of unspecified pubis, subsequent encounter for fracture with nonunion)10.000000.000031.4709CCNon-CC.

The C1, C2, and C3 values in the table above are generally close to 1.0, 2.0, and 3.0, respectively, particularly for those codes for which the highest number of cases were reported. This indicates that these conditions are more aligned with a non-CC than with either a CC or an MCC. Our clinical advisors reviewed these data, particularly with respect to ICD-10-CM diagnosis codes S32.591A and S32.592A which account for the majority of cases in this group, and believe the resources involved in caring for a patient with these conditions are more aligned with a non-CC. Our clinical advisors noted that, similar to the proposed severity level designation changes in the Neoplasms chapter of the ICD-10-CM diagnosis classification discussed above, if patients are admitted for treatment of an acute or nonunion fracture of the pubic bone, the fracture is the principal diagnosis, and other complicating or comorbid conditions reported as secondary diagnoses would determine the appropriate severity level for each particular case. For example, if a patient is admitted for surgical treatment of the nonunion of a right pubic fracture at the superior rim, ICD-10-CM diagnosis code S32.511K (Fracture of superior rim of right pubis, subsequent encounter for fracture with nonunion) is reported as the principal diagnosis. Because our clinical advisors believe that it is appropriate to ensure consistency across codes involving similar diagnoses, we are proposing to reassign the severity level for all of the codes in the table above from a CC to a non-CC.

In category S72 (Fracture of femur) of the ICD-10-CM classification, based on our comprehensive analysis, we are proposing to change the severity level designation from MCC to CC for 35 ICD-10-CM diagnosis codes specifying fractures of the hip. The following table contains the Injury, Poisoning and Certain Other Consequences of External Causes chapter codes for which we are proposing a severity level change, and their impact on resource use when reported as a secondary diagnosis.

Proposed Severity Level Changes, Hip Fracture Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
S72.011A (Unspecified intracapsular fracture of right femur, initial encounter for closed fracture)1452.14004642.34197002.9623MCCCC.
S72.012A (Unspecified intracapsular fracture of left femur, initial encounter for closed fracture)1552.00994552.27387543.0423MCCCC.
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S72.019A (Unspecified intracapsular fracture of unspecified femur, initial encounter for closed fracture)10.936441.0008102.7267MCCCC.
S72.111A (Displaced fracture of greater trochanter of right femur, initial encounter for closed fracture)2661.51106052.29834423.1874MCCCC.
S72.112A (Displaced fracture of greater trochanter of left femur, initial encounter for closed fracture)2491.77795732.46264183.0108MCCCC.
S72.113A (Displaced fracture of greater trochanter of unspecified femur, initial encounter for closed fracture)111.7739212.9650233.5762MCCCC.
S72.114A (Nondisplaced fracture of greater trochanter of right femur, initial encounter for closed fracture)1120.88263392.16401783.1028MCCCC.
S72.115A (Nondisplaced fracture of greater trochanter of left femur, initial encounter for closed fracture)1181.39602882.06072022.8640MCCCC.
S72.116A (Nondisplaced fracture of greater trochanter of unspecified femur, initial encounter for closed fracture)30.947281.303033.4270MCCCC.
S72.121A (Displaced fracture of lesser trochanter of right femur, initial encounter for closed fracture)222.0288743.1110493.1174MCCCC.
S72.122A (Displaced fracture of lesser trochanter of left femur, initial encounter for closed fracture)231.1648752.9379402.4430MCCCC.
S72.123A (Displaced fracture of lesser trochanter of unspecified femur, initial encounter for closed fracture)00.000020.000062.2881MCCCC.
S72.124A (Nondisplaced fracture of lesser trochanter of right femur, initial encounter for closed fracture)40.9792192.424482.7792MCCCC.
S72.125A (Nondisplaced fracture of lesser trochanter of left femur, initial encounter for closed fracture)50.6759131.270073.1292MCCCC.
S72.126A (Nondisplaced fracture of lesser trochanter of unspecified femur, initial encounter for closed fracture)00.000000.000011.1159MCCCC.
S72.131A (Displaced apophyseal fracture of right femur, initial encounter for closed fracture)13.432700.000024.0000MCCCC.
S72.132A (Displaced apophyseal fracture of left femur, initial encounter for closed fracture)00.000012.642300.0000MCCCC.
S72.134A (Nondisplaced apophyseal fracture of right femur, initial encounter for closed fracture)00.00013.50100.000MCCCC.
S72.135A (Nondisplaced apophyseal fracture of left femur, initial encounter for closed fracture)00.00000.00000.000MCCCC.
S72.136A (Nondisplaced apophyseal fracture of unspecified femur, initial encounter for closed fracture)00.00000.00000.000MCCCC.
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S72.141A (Displaced intertrochanteric fracture of right femur, initial encounter for closed fracture)2892.26078942.63291,2933.1692MCCCC.
S72.142A (Displaced intertrochanteric fracture of left femur, initial encounter for closed fracture)3472.25879722.56411,4053.1003MCCCC.
S72.143A (Displaced intertrochanteric fracture of unspecified femur, initial encounter for closed fracture)102.3446211.0169353.3080MCCCC.
S72.144A (Nondisplaced intertrochanteric fracture of right femur, initial encounter for closed fracture)441.73311492.46371683.1302MCCCC.
S72.145A (Nondisplaced intertrochanteric fracture of left femur, initial encounter for closed fracture)391.91701122.84351703.2612MCCCC.
S72.146A (Nondisplaced intertrochanteric fracture of unspecified femur, initial encounter for closed fracture)00.000091.225020.0000MCCCC.
S72.21XA (Displaced subtrochanteric fracture of right femur, initial encounter for closed fracture)571.76971592.24602053.1614MCCCC.
S72.22XA (Displaced subtrochanteric fracture of left femur, initial encounter for closed fracture)702.36851602.60791843.2178MCCCC.
S72.23XA (Displaced subtrochanteric fracture of unspecified femur, initial encounter for closed fracture)00.000093.470863.3401MCCCC.
S72.24XA (Nondisplaced subtrochanteric fracture of right femur, initial encounter for closed fracture)120.5442222.7275113.6028MCCCC.
S72.25XA (Nondisplaced subtrochanteric fracture of left femur, initial encounter for closed fracture)131.7115252.1005173.1686MCCCC.
S72.26XA (Nondisplaced subtrochanteric fracture of unspecified femur, initial encounter for closed fracture)00.000012.047400.0000MCCCC.
S72.301A (Unspecified fracture of shaft of right femur, initial encounter for closed fracture)612.34621563.04911593.5567MCCCC.
S72.302A (Unspecified fracture of shaft of left femur, initial encounter for closed fracture)712.63141862.48381573.4436MCCCC.

As shown in the table above, all of these secondary diagnoses are currently designated as MCCs. The C2 values of the codes most frequently reported, ICD-10-CM codes S72.142A and S72.141A, are closer to 3.0 than 2.0, which indicates that they are more clinically aligned with a CC than an MCC. Therefore, the data suggest that when fracture of the hip codes are reported as a secondary diagnosis, the resources involved in caring for patients with these conditions are more aligned with a CC than an MCC. Our clinical advisors reviewed these data and believe the resources involved in caring for patients with these conditions are more aligned with a CC. While we note that there is little to no data for some of these ICD-10-CM codes as secondary diagnoses, there is sufficient data for clinically similar secondary diagnoses. Therefore, because our clinical advisors believe that it is appropriate to ensure consistency across codes involving similar diagnoses, we are proposing to reassign the severity level for all of the codes in the table above from an MCC to a CC.

(f) Factors Influencing Health Status and Contact With Health Services

The last chapter of the ICD-10-CM classification specifies other factors that influence a patient's health status or necessitate contact with health care Start Printed Page 19244providers (Z00-Z99). Of these ICD-10-CM codes, based on our comprehensive review, we are proposing to change the severity level designation from non-CC to CC for four codes specifying anti-microbial drug resistance and one code specifying homelessness. Based on this same review, we also are proposing to change the severity level designation from CC to non-CC for 3 ICD-10-CM codes specifying adult body mass index (BMI) ranges and 13 ICD-10-CM codes indicating that the patient has previously undergone an organ transplant or cardiac device implantation with no current complications (the code indicates status only).

The following table contains the five codes for which we are proposing a severity level change from non-CC to CC and their impact on resource use when reported as a secondary diagnosis.

Proposed Severity Level Changes for Z Chapter Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
Z16.12 (Extended spectrum beta lactamase (ESBL) resistance)3,0822.113419,6922.599525,5443.1752Non-CCCC.
Z16.21 (Resistance to vancomycin)6922.15076,7332.865911,6723.3365Non-CCCC.
Z16.24 (Resistance to multiple antibiotics)2,9701.582116,0972.408620,7383.1174Non-CCCC.
Z16.39 (Resistance to other specified antimicrobial drug)4481.20032,3262.25552,4943.1127Non-CCCC.
Z59.0 (Homelessness)14,9271.596441,3282.301222,1013.1256Non-CCCC.

As indicated above, a value close to 2.0 in column C1 suggests that the secondary diagnosis is more aligned with a CC than a non-CC. Because the C1 values in the table above are generally close to 2, the data suggest that when these five Z chapter diagnosis codes are reported as a secondary diagnosis, the resources involved in caring for a patient with other factors such as homelessness support increasing the severity level from a non-CC to a CC. Our clinical advisors reviewed these data and believe the resources involved in caring for patients with these other reported factors are more aligned with a CC.

While we note that ICD-10-CM diagnosis code Z16.39 does not follow this pattern, our clinical advisors believe that this code is clinically similar to the other diagnoses in the table above describing anti-microbial drug resistance. Therefore, because our clinical advisors believe that it is appropriate to ensure consistency across codes involving similar diagnoses, we are proposing to reassign the severity level for all four of the codes specifying anti-microbial drug resistance in the table above from a non-CC to a CC.

The following table contains the 14 BMI and transplant/cardiac device status codes for which we are proposing a severity level designation change from CC to non-CC, and their impact on resource use when reported as a secondary diagnosis.

Proposed Severity Level Changes for Z Chapter BMI and Transplant/Cardiac Device Status Codes as Secondary Diagnosis

ICD-10-CM diagnosis codeCnt1C1Cnt2C2Cnt3C3Current CC subclassProposed CC subclass
Z68.1 (Body mass index (BMI) 19.9 or less, adult)18,9831.1170244,1562.2082350,7313.0733CCNon-CC.
Z68.41 (Body mass index (BMI) 40.0-44.9, adult)139,4201.1139209,3002.0752213,9293.0814CCNon-CC.
Z68.42 (Body mass index (BMI) 45.0-49.9, adult)60,4081.1643102,8972.0783109,9283.0867CCNon-CC.
Z94.0 (Kidney transplant status)18,6491.027770,4842.057345,3823.1032CCNon-CC.
Z94.1 (Heart transplant status)2,3111.06498,1382.24715,0373.2653CCNon-CC.
Z94.2 (Lung transplant status)1,4611.08865,0322.18983,4663.1285CCNon-CC.
Z94.3 (Heart and lungs transplant status)200.8287883.0647593.1675CCNon-CC.
Z94.4 (Liver transplant status)6,0500.981117,5562.032312,9703.1688CCNon-CC.
Z94.81 (Bone marrow transplant status)1,6550.97785,4472.09195,1503.1918CCNon-CC.
Z94.82 (Intestine transplant status)1191.56613512.18442303.2081CCNon-CC.
Z94.83 (Pancreas transplant status)1,7891.20327,7882.07394,5363.1381CCNon-CC.
Z94.84 (Stem cells transplant status)3,0831.145110,4122.30418,8353.2932CCNon-CC.
Z95.811 (Presence of heart assist device)1,0531.64537,3732.30895,9743.1198CCNon-CC.
Z95.812 (Presence of fully implantable artificial heart)452.04671322.56031422.4139CCNon-CC.
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The C1, C2, and C3 values in the table above are generally close to 1.0, 2.0, and 3.0, respectively. This indicates that these conditions are more aligned with a non-CC than with either a CC or an MCC. Therefore, the data suggest that when these BMI and transplant/cardiac device status codes are reported as a secondary diagnosis, the resources involved in caring for patients with these conditions indicating health status are not aligned with those of a CC. Our clinical advisors reviewed these data and believe the resources involved in caring for patients with these conditions indicating health status are more aligned with a non-CC. Our clinical advisors noted that, in the absence of a diagnosis that represents a complication of the patient's current status, the presence of a BMI within a stated range or the fact that a patient has previously undergone a transplant or cardiac device implant is not by itself a clinical indication of increased severity of illness. Therefore, we are proposing to reassign the severity level for all of the codes in the table above from a CC to a non-CC.

(3) Results of Impact Analysis

Using claims data from the September 2018 update of the FY 2018 MedPAR file, we employed the following method to determine the impact of changing severity level designation for the 1,492 ICD-10-CM diagnosis codes. Edits and cost estimations used for relative weight calculations were applied, resulting in 8,908,404 IPPS claims analyzed for this impact evaluation of our proposed changes to severity levels. We refer readers to section II.G. of the preamble of this proposed rule for further information regarding the methodology for calculation of the proposed relative weights.

First, we analyzed the 8,908,404 IPPS claims using the Version 36 ICD-10 MS-DRG GROUPER to determine the current distribution of severity level designation. We identified 3,648,331 cases (41.0 percent) reporting one or more secondary diagnosis codes assigned to the MCC severity level, 3,612,600 cases (40.5 percent) reporting one or more secondary diagnosis codes assigned to the CC severity level, and 1,647,473 cases (18.5 percent) not reporting a secondary diagnosis code assigned to the MCC or CC severity level.

Next, we reprocessed the 8,908,404 claims using the proposed change in severity level designation for the 1,492 ICD-10-CM diagnosis codes to determine the impact on the distribution of severity level designation. We identified 3,236,493 cases (36.3 percent) reporting one or more secondary diagnosis codes that would be assigned to the MCC severity level, 3,589,677 cases (40.3 percent) reporting one or more secondary diagnosis codes that would be assigned to the CC severity level, and 2,082,234 cases (23.4 percent) not reporting a secondary diagnosis code that would be assigned to the MCC or CC severity level.

Below we provide a summary of the steps followed for the analysis performed.

Step 1.—Analyzed 8,908,404 claims to determine the current distribution of severity level designation.

Severity Level Distribution Before Proposed Changes—8,908,404 Claims Analyzed

Number of cases reporting one or more secondary diagnosis codes assigned to the MCC severity level3,648,331 (41.0%)
Number of cases reporting one or more secondary diagnosis codes assigned to the CC severity level3,612,600 (40.5%)
Number of cases reporting no secondary diagnosis codes assigned to the MCC or CC severity level1,647,473 (18.5%)

Step 2.—Made proposed severity level changes to 1,492 ICD-10-CM codes.

Step 2—Made proposed severity level changes to 1,492 ICD-10-CM codes.

Current version 36 severity levelProposed version 37 severity levelNumber of codes
Non-CCCC183
CCNon-CC1,148
CCMCC8
MCCNon-CC17
MCCCC136
Total1,492

Step 3.—Reprocessed 8,908,404 claims to determine severity level distribution after changes.

Severity Level Distribution after Proposed Changes—8,908,404 Claims Analyzed

Number of cases reporting one or more secondary diagnosis codes assigned to the MCC severity level3,236,493 (36.3%)
Number of cases reporting one or more secondary diagnosis codes assigned to the CC severity level3,589,677 (40.3%)
Number of cases reporting no secondary diagnosis codes assigned to the MCC or CC severity level2,082,234 (23.4%)

The overall statistics by CC subgroup for the proposed Version 37 MS-DRGs are contained in the table below. Cases in the MCC subgroup have average costs that are 62 percent higher than the average costs for cases in the CC subgroup. The CC subgroup with the largest number of cases is the CC subgroup with 40.3 percent of the cases.