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EDITOR’S NOTE: This article is the second article in a two-part series regarding FY17 IPPS Proposed Rule. Read part one here.

The Centers for Medicare and Medicaid Services (CMS) has released the display version of Inpatient Prospective Payment System (IPPS) for fiscal year 2017 on April 18, 2017. Comments on Proposed Rule are due to CMS by 5:00 PM EDT on June 17, 2016, and can be posted on http://www.regulations.gov. There are a total of 1,585 pages in this proposed rule.    

This article will focus on the Medicare Severity Diagnosis Related Groups (MS-DRGs) changes proposed in this rule.

MS-DRG shifting under ICD-10 has been widely reported. At the March 2013 Coordination and Maintenance Committee meeting, the conversion from ICD-9-CM MS-DRGs to ICD-10 MS-DRGs was discussed. It was reported that the net impact of the conversion across all MS-DRGs was a negative 0.04 percent. This proposed rule reflects the comments that were submitted by December 2015. Any suggestions on MS-DRG changes should be emailed to MSDRGClassificationChange@cms.hhs.gov. The MS-DRG analysis was based on claims through September 30, 2015, and discharges through September 30, 2015. You have probably noticed that this analysis does not include any ICD-10-CM/PCS coded claims.

Pre-MDC: Total Artificial Heart Replacement procedure is represented by 02RK0JZ and 02RL0JZ. This code cluster is proposed to be assigned to MS-DRGs 1 (Heart Transplant or Implant of Heart Assist System w MCC) and 2 (Heart Transplant or Implant of Heart Assist System w/o MCC).

MDC 1: A change to endovascular embolization or occlusion of head and neck procedures was entertained, but the end recommendation was to make no changes to MS-DRGs 20 – 27. There are four mechanical complication of nervous system device codes – T85.610A, T85.620A, T85.630A, and T85.690A – that will be moved from MS-DRGs 919, 920, and 921 to MS-DRGs 091, 092, and 093.

MDC 4: R22.2 (localized swelling, mass, and lump, trunk) will be reassigned from MDC 4 to MDC 9, MS-DRGs 606 and 607. There was an investigation into Pulmonary Embolism with tPA or other thrombolytic therapy, but no changes were recommended.    

MDC 5: Four codes for the insertion and revision of a loop recorder will now be designated as an OR procedure. These codes will now impact MS-DRGs 40 – 42, 260 – 262, 579 – 581, 907 – 909, and 957 – 959. Endovascular thrombectomy of the lower limbs classified to MS-DRGs 270 – 272 will include 52 additional ICD-10-PCS codes that fall in the tables of 03C, 04C, 05C, and 06C. In this MDC, there is also a change in the logic for pacemakers. The suggestions are to change the methodology so that any procedure code involving cardiac pacemaker devices with procedures codes involving cardiac pacemaker leads will yield MS-DRGs 242, 243, and 244. The list of procedures can be found on pages 169-173 in the display copy. More changes for pacemakers with regards to pacemaker replacement methodology which includes that any removal and replacement of cardiac pacemakers. If a procedure involving a pacemaker insertion is reported without a procedure for insertion of cardiac pacemaker leads, the resulting MS-DRG could be 258 or 259 (Cardiac pacemaker replacement w or w/o MCC). The pacemaker revision methodology has been modified so that any procedure involving insertion, removal, or revision and insertion of hemodynamic devices without insertion of the cardiac pacemaker is now assigned to MS-DRG 260-262 (Cardiac pacemaker revision except device replacement w/MCC, w/CC, and w/o MCC/CC). See pages 177-179 for list of procedure codes. There is news in this MDC about the discontinuation of the new technology status for MitraClip. With the discontinuation of the new technology designation, the procedure code (02UG3JZ) will be reassigned from 273 and 274 (Percutaneous Intracardiac Procedures w and w/o MCC) to 228 and 229 (Other Cardiothoracic Procedures w/MCC, w/CC). MS-DRG 230 will be deleted. This procedure code, 02UG3JZ, will be removed from the percutaneous transluminal coronary angioplasty list for MS-DRGs 231 and 232. After some discussion, there were be no changes to the automatic implanted cardio-defibrillator MS-DRG 245. The data review showed that there was no need to split based on severity.

MDC 6: Excision of ileum (0DBB0ZZ) or jejunum (0DBA0ZZ) will be reassigned from MS-DRGs 347-349 to MS-DRGs 329-331.

MDC 7: ICD-10-PCS code 06183DY (bypass of the portal vein to lower vein with intraluminal device) will be assigned to MS-DRGs 405, 406, 407 (Pancreas, liver, and shunt procedures w/MCC, w/CC, and w/o MCC/CC).

MDC 8: There will not be a separate MS-DRG for total ankle replacements or for total hip replacements for hip fractures. For combinations of removal and replacement of knee joints (MS-DRG 466 – 468), there are 58 new combinations of procedure codes that will be added to the methodology. See pg. 210-215 for the ICD-10-PCS code combinations. There will be a reassignment of procedure codes for decompression laminectomy from MS-DRGs 515 – 517 to MS-DRGs 28 – 30 and 518 – 520. MS-DRGs 456 – 458 (Spinal Fusion Except Cervical with Spinal Curvature/Malignancy/Infection or Exterior Fusion w/MCC, w/CC, or w/o MCC or CC) will add four diagnosis codes to the principal diagnosis list only. These codes include M40.50, M40.55, M40.56, and M40.57 and cover the diagnosis of lordosis.

MDC 13: A code cluster will be removed from the MS-DRGs 332 – 334 (Rectal resection w/MCC, w/CC, and w/o MCC or CC). The code cluster will remain for MS-DRGs 734 – 735 (Pelvic evisceration, radical hysterectomy, radical vulvectomy w/CC/MCC or w/o CC/MCC).

MDC 18: A minor change was made to MS-DRG 884 title. The title of this MS-DRG is proposed to be changed to Organic Disturbances and Intellectual Disability from Organic Disturbances and Mental Retardation.

In addition to the previous detailed MS-DRG suggestions, Tables 6I.1 and 6I.2 provide changes to the Major Complication Comorbidities list. Some additions are cerebral infarction with thrombosis/embolus of carotid and vertebral arteries and different forms of pancreatitis. The deletions include nontraumatic subarachnoid hemorrhage, some forms of pancreatitis, and concussion with loss of consciousness greater than 24 hours and not returning to pre-existing conscious level with patient surviving. Tables 6J.1 and 6J.2 are additions and deletions to the complications/comorbidities list. Some suggested deletions include fractures of the mandible, third degree perineal laceration during delivery, and ectopic pregnancies.   

Importantly, the revised FY17 MS-DRGs address many of the known issues with the methodology. There are approximately 334 MS-DRGs relative weights that will decrease, but the overall change in the relative weights is 3.9460. This net impact includes the elimination of MS-DRG 230. Stay tuned for the final rule, which is scheduled for an Aug. 1 release.

Proposed rule can be found at https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-09120.pdf 


Laurie M. Johnson, MS, RHIA, FAHIMA, AHIMA Approved ICD-10-CM/PCS Trainer

Laurie Johnson is currently a senior healthcare consultant for Revenue Cycle Solutions, based in Pittsburgh, Pa. Laurie is an AHIMA-approved ICD-10-CM/PCS trainer. She has more than 35 years of experience in health information management and specializes in coding and related functions. She has been a featured speaker in over 40 conferences. Laurie is a member of the ICD10monitor editorial board and is a permanent panelist on Talk Ten Tuesdays

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