OIG to Audit High Risk DRGs

The OIG has released the November update to their Work Plan.  The most recent update includes plans to audit hospital claims billed with mechanical ventilation services, as well as, claims billed with severe malnutrition ICD-10 diagnosis codes. 

These two areas have been repeatedly identified by the OIG as high-risk and have been an ongoing target for multiple OIG and CMS audits.  The audit report findings, over the years, consistently show high coding error rates that, in turn, result in high overpayment error rates.

Mechanical Ventilation

In order to meet the mechanical ventilation criteria for certain MS-DRGs, as well as, the higher reimbursement rate, a Medicare beneficiary must receive more than 96 hours of consecutive mechanical ventilation (reported with ICD-10-PCS code 5A1955Z). The DRGs that are impacted by coding of mechanical ventilation include 3, 4, 207, 208, 870, 871, 872, 927 and 933.

To correctly report mechanical ventilation hours, the time counted must be continuous and starts with either: Endotracheal intubation (and subsequent initiation of mechanical ventilation), OR Initial mechanical ventilation through a tracheostomy, OR Admission of a previously intubated patient who is on mechanical ventilation.

Severe Malnutrition

The OIG released an audit report last year that found an 87% coding error rate and an 82% overpayment error rate due to improper ICD-10-CM coding of severe malnutrition (ICD-10-CM codes E41 and E43).  In that audit, the OIG estimated $1 billion in Medicare overpayments for FYs 2016 and 2017.

The assignment of severe malnutrition ICD-10 codes requires documentation of certain clinical parameters.  Recognized guidelines for the diagnosis of severe malnutrition are published by the Academy of Nutrition and Dietetics, the American Society of Parenteral and Enteral Nutrition and the American Society of Nutrition.  

The audits announced in the November Work Plan update will focus on whether hospitals complied with Medicaid billing requirements when assigning severe malnutrition diagnosis codes to inpatient hospital claims.   

In Conclusion

We recommend hospitals conduct auditing of procedural coding of mechanical ventilation as well as diagnosis coding of severe malnutrition in order to proactively identify any potential coding and overpayment errors, as well as, documentation improvement opportunities.  Education and training should be provided to both clinical and coding staff regarding findings of the auditing.  We also recommend reviewing internal clinical policies and criteria for the diagnosis of severe malnutrition to confirm consistency with recognized guidelines.

HBE’s team of coding and compliance experts is available to assist you with external reviews of your documentation, coding and reimbursement. Additionally, we can provide customized education and training for your staff regarding proper documentation and coding.  We are also available to provide assistance with conducting risk assessments, internal investigations and policy and procedure development.  

To see the entirety of the OIG Work Plan update visit: https://oig.hhs.gov/reports-and-publications/workplan/updates.asp

DISCLAIMER:  This newsletter contains only summary information and highlights; it should be read in conjunction with the full article or document provided as a link.  Any advice or recommendations are general and specific questions should be directed to professional counsel.

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