Master the upcoming ICD-10 code and IPPS changes! Prepare your team for the upcoming changes taking effect on October 1. Discover the benefits of IPPSPalooza and how it can drive your success. Click here >

Issues and Implications: MedPAC to Benchmarks to KPIs

Observations, questions and answers during a week of pontification. 

So what’s new this week? In a previous Monitor Monday, I mentioned the recently released 2022 Medicare Payment Advisory Commission report to Congress that addressed several site neutral payment proposals. One other tidbit from that report is that they have suggested to the Centers for Medicare & Medicaid Services (CMS) that ED visits, critical care visits and trauma care facility charges be converted from standard APCs to Comprehensive APCs.

 That means the hospital would get one single payment for the ED patient who is not subsequently admitted to the hospital, just as Medicare now pays for outpatient surgery and outpatient care with observation services. With this proposal, if the ED physician does no CT scans or three CT scans and an MRI, no labs or a whole panel of labs, it is that one same payment. Once again, their motivation is to save Medicare money, but one must wonder at what cost? How many trauma centers will become financially nonviable if trauma visits are paid at one set level and lead to limited access to trauma care?

Next, I have been talking a lot about observation and billing. And that’s because there is a lot to talk about. It’s confusing. But last week I got an email from a hospital that was one of those “aha” moments. This person was inquiring about the observation patient that stays a few hours after they have been determined stable for discharge. Now for most hospitals Medicare pays the observation visit as a comprehensive APC, one fixed price so a few extra hours does not affect payment in most cases. But this hospital gets paid based on a percent of charges. That means that if an observation patient stays an additional six hours waiting for a ride and is not formally discharged until their ride arrives, as is routine in most hospitals, this hospital gets paid more money for the visit.

The Claims Processing Manual says “Billing ends when all clinical or medical interventions have been completed including care after the discharge order has been given” so that is not much help. Should these hours be billed as observation and paid as such? I am not so sure. Billing any unnecessary services is problematic but when there is actual direct revenue implication, it seems more significant.

Finally, last week I was talking to a group about my other favorite topic, the admission status of patients having elective joint replacement. And I was asked what was the benchmark inpatient admission rate?

Well, that was just the opening I needed to provide my definitions of a key performance indicator (KPI) and a benchmark. A key performance indicator is a random measurement of something/anything that can be easily generated by a hospital computer system with a couple of clicks that the C-suite has been convinced means something and a benchmark is an arbitrary target for that KPI set by someone with a cursory knowledge of the facts.

Of course, these definitions represent the epitome of my well-known negativism and should be taken with a grain of salt, but the request for a benchmark rate of inpatient admissions is a great example. Now what I was able to tell the questioner is that in 2021, the average inpatient percent was 30 to 35 percent.  But in no way is that the right rate for any one facility. The benchmark rate is when every patient is placed in the right status every time. That is the goal to which we should all strive.

Programming Note: Listen to Dr. Ronald Hirsch as he makes his Monday rounds during Monitor Mondays and sponsored by R1 RCM.

Print Friendly, PDF & Email
Facebook
Twitter
LinkedIn
Email
Print

Ronald Hirsch, MD, FACP, CHCQM, CHRI

Ronald Hirsch, MD, is vice president of the Regulations and Education Group at R1 Physician Advisory Services. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices and is a published author on the topic. He is a member of the Advisory Board of the American College of Physician Advisors, a member of the American Case Management Association, and a Fellow of the American College of Physicians. Dr. Hirsch is a member of the RACmonitor editorial board and is regular panelist on Monitor Mondays. The opinions expressed are those of the author and do not necessarily reflect the views, policies, or opinions of R1 RCM, Inc. or R1 Physician Advisory Services (R1 PAS).

Related Stories

Leave a Reply

Please log in to your account to comment on this article.

Featured Webcasts

Mastering the Two-Midnight Rule: Keys to Navigating Short-Stay Admissions with Confidence

Mastering the Two-Midnight Rule: Keys to Navigating Short-Stay Admissions with Confidence

The CMS Two-Midnight Rule and short-stay audits are here to stay, impacting inpatient and outpatient admissions, ASC procedures, and Medicare Parts C & D. New for 2024, the Two-Midnight Rule applies to Medicare Advantage patients, requiring differentiation between Medicare plans affecting Case Managers, Utilization Review, and operational processes and knowledge of a vital distinction between these patients that influences post-discharge medical reviews and compliance risk. Join Michael G. Calahan for a comprehensive webcast covering federal laws for all admission processes. Gain the knowledge needed to navigate audits effectively and optimize patient access points, personnel, and compliance strategies. Learn Two-Midnight Rule essentials, Medicare Advantage implications, and compliance best practices. Discover operational insights for short-stay admissions, outpatient observation, and the ever-changing Inpatient-Only Listing.

Print Friendly, PDF & Email
September 19, 2023
Secondary Diagnosis Coding: A Deep Dive into Guidelines and Best Practices

Secondary Diagnosis Coding: A Deep Dive into Guidelines and Best Practices

Explore comprehensive guidelines and best practices for secondary diagnosis coding in our illuminating webcast. Delve into the intricacies of accurately assigning secondary diagnosis codes to ensure precise medical documentation. Learn how to navigate complex scenarios and adhere to coding regulations while enhancing coding proficiency. Our expert-led webcast covers essential insights, including documentation requirements, sequencing strategies, and industry updates. Elevate your coding skills and stay current with the latest coding advancements so you can determine the correct DRG assignment to optimize reimbursement, support medical decision-making, and maintain compliance.

Print Friendly, PDF & Email
September 20, 2023
Principal Diagnosis Coding: Mastering Selection and Sequencing

Principal Diagnosis Coding: Mastering Selection and Sequencing

Enhance your inpatient coding precision and revenue with Principal Diagnosis Coding: Mastering Selection and Sequencing. Join our expert-led webcast to conquer the challenges of principal diagnosis selection and sequencing. We’ll decode the intricacies of ICD-10-CM guidelines, equipping you with a clear grasp of the rules and the official UHDDS principal diagnosis definition. Uncover the crucial role of coding conventions, master the sequencing of related conditions, and confidently tackle cases with equally valid principal diagnoses.

Print Friendly, PDF & Email
September 14, 2023
2024 IPPS Summit: Final Rule Update with Expert Insights and Analysis

2024 IPPS Summit: Final Rule Update with Expert Insights and Analysis

Only ICD10monitor delivers what you need: updates on must-know changes associated with the FY24 Inpatient Prospective Payment System (IPPS) Final Rule, including new ICD-10-CM/PCS codes, plus insights, analysis and answers to questions from the country’s most respected subject matter experts.

Print Friendly, PDF & Email
2024 IPPS Summit Day 3: MS-DRG Shifts and NTAPs

2024 IPPS Summit Day 3: MS-DRG Shifts and NTAPs

This third session in our 2024 IPPS Summit will feature a review of FY24 changes to the MS-DRG methodology and new technology add-on payments (NTAPs), presented by senior healthcare consultant Laurie Johnson, with bonus insights and analysis from two acclaimed subject matter experts

Print Friendly, PDF & Email
August 17, 2023

Trending News