How to Avoid Upcoding to DRG 475

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How to Avoid Upcoding to DRG 475

Claudia Urech, RRA

Cost shifting, increased competition, constrained reimbursement and reform initiatives continue to take a toll on hospitals across the country. As a result, physicians, coders and reimbursement managers face a dual challenge. They must obtain the highest allowable payment while staying within compliance parameters.

The Department of Health and Human Services’ Office of Inspector General (OIG) has discovered that several diagnosis-related groups (DRGs) are vulnerable to upcoding. One of these is DRG 475 (respiratory system diagnosis with ventilator support).

Money Matters

In 1996, Medicare reimbursed hospitals almost $2 billion for cases in DRG 475. Usually, this DRG, which has a weight of 3.7429, has a higher payment than most other DRGs. On average, that comes in at about $15,000 per case.

According to a random sample of Medicare claims conducted by the Health Care Financing Administration (HCFA), approximately 7 percent of the discharges from DRG 475 in 1996 should have been classified to a lower-weighted DRG. By HCFA’s estimates, the total overpayment attributable to incorrect DRG 475 classifications was $67 million.

To validate these findings, HCFA ordered another random sample of Medicare claims (fiscal years 1993 to 1996) to identify hospitals with atypically high billings for DRG 475. While a total of 3,714 hospitals nationwide had at least one case in DRG 475, a relatively small number (46) had abnormally high DRG 475 discharges. But the OIG estimated that potential overpayments for those 46 hospitals could be as high as $11.5 million for just one of the three years reviewed.

Coding Errors and Guidelines

In general, incorrect assignment to DRG 475 can be condensed to a couple of errors. Most come from confusion over determining the principal diagnosis. (To be placed in DRG 475, the principal diagnosis must be a true respiratory diagnosis.)

Confusion also may be caused by inappropriate sequencing of respiratory failure, one of the most common principal diagnoses in DRG 475 assignment. Finally, it’s essential to correctly sequence respiratory failure in association with nonrespiratory conditions.

Guidelines for DRG 475

In 1991, a copy of the American Hospital Association’s (AHA) Coding Clinic (second quarter) addressed this very issue. The AHA provided the following guidelines to help coders determine the correct sequencing of diagnoses.

* The principal diagnosis is respiratory failure when a patient is admitted with respiratory failure that is due to, or associated with, a chronic nonrespiratory condition.

Example: A patient developed progressive myasthenia gravis leading to respiratory failure. He was admitted, and the physician directed treatment to both conditions. Respiratory failure (518.81) is the principal diagnosis and myasthenia gravis (358.0) is an additional diagnosis.

* When a patient is admitted with respiratory failure that is due to, or associated with, an acute exacerbation of a chronic nonrespiratory condition, that condition is the principal diagnosis.

Example: A patient with congestive heart failure (CHF) developed dyspnea and pedal edema and increasing respiratory distress. In the emergency room (ER), she was found to be in cardiogenic pulmonary edema and respiratory failure. She was intubated and placed on mechanical ventilation. The patient was admitted and treated for CHF. In this case, the CHF (428.0) is the principal diagnosis, and respiratory failure (518.81) is an additional diagnosis.

* When a patient is admitted with respiratory failure that is due to, or associated with, an acute nonrespiratory condition, that condition is sequenced as the principal diagnosis.

Example: A patient who was seen in the ER with chest pain and shortness of breath was intubated. He was admitted and diagnosed as having an acute myocardial infarction (AMI) complicated by respiratory failure. The AMI (410.91) is the principal diagnosis, and respiratory failure is an additional diagnosis.

To ensure that your facility is in compliance, routinely check your code assignments of this DRG to be certain that the documentation supports them.

Claudia Urech, a senior health care consultant with Medical Learning Inc., St. Paul, MN, has more than 25 years of experience in coding, reimbursement and health information management.

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