THE LIVANTA
CLAIMS REVIEW
ADVISOR
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A monthly publication to raise
awareness, share findings, and
provide guidance about Livanta’s
Claim Review Services
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Higher-Weighted Diagnosis Related Groups (HWDRG) Validation – Second Year Review Findings |
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This month’s issue of The Livanta Claims Review Advisor reports on findings from the second year of reviews under Livanta’s national Claim Review Services contract. Results for the second year encompass reviews completed from November 1, 2022 through October 31, 2023.
Adjustments submitted to a Medicare Part A claim that result in a higher-weighted DRG code triggers a potential review of that adjusted claim. This post-pay review ensures that the patient’s diagnostic, procedural, and discharge information is coded and reported properly on the hospital’s claim as compared to documentation in the medical record. HWDRG claim reviews entails two decisions: medical necessity of the inpatient admission and DRG validation.
Review of these HWDRG adjustments is mandated under statute and instruction from the Centers for Medicare & Medicaid Services (CMS) as quoted in the CMS Quality Improvement Organization (QIO) Manual: “Perform DRG validation on prospective payment system (PPS) cases (including hospital-requested higher-weighted DRG assignments), as appropriate (see §1866(a)(1)(F) of the Act and 42 CFR 476.71(a)(4)).”
Source:
HWDRG reviews involve validation of codes on the claim by credentialed coding auditors and clinical review by board-certified practicing physicians as appropriate. Livanta’s coding auditors validate the DRGs based on the documentation in the medical record, using official coding guidelines, the American Hospital Association (AHA) Coding Clinics, and other authoritative coding references. Livanta’s credentialed auditors adhere to the accepted principles of coding practice to validate the accuracy of the hospital codes that affect the DRG payment. Audits also may involve a clinical review by actively practicing physician reviewers. These physician reviewers determine the clinical validity of physician queries, documented diagnoses and procedures, and the medical necessity of the inpatient admissions. Livanta’s rejections of requested HWDRGs can result from either coding audits, physician reviews, or both.
Livanta’s CMS-approved sampling strategy for HWDRG claims is described in the June 2023 edition of this newsletter, which can be found here:
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After review, 88 percent of HWDRG claims were approved for the higher-weighted DRG submitted and paid. Again, results for the second year encompass reviews completed from November 1, 2022 through October 31, 2023. |
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These regional findings are based on claims sampled and reviewed in accordance with the CMS-approved sampling strategy as outlined in the June 2023 edition of this newsletter and referenced above.
Medical necessity errors were all due to failure to meet the guidelines of the Two-Midnight Rule.
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Region 1 - Boston
• Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont
Region 2 - New York
• New Jersey, New York, Puerto Rico, and the U.S. Virgin Islands
Region 3 - Philadelphia
• Delaware, District of Columbia, Maryland, Pennsylvania, Virginia, and West Virginia
Region 4 - Atlanta
• Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, and Tennessee
Region 5 - Chicago
• Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin
Region 6 - Dallas
• Arkansas, Louisiana, New Mexico, Oklahoma, and Texas
Region 7 - Kansas City
• Iowa, Kansas, Missouri, and Nebraska
Region 8 - Denver
• Colorado, Montana, North Dakota, South Dakota, Utah, and Wyoming
Region 9 - San Francisco
• Arizona, California, Hawaii, Nevada, American Samoa, Commonwealth of the Northern Mariana Islands, Federated States of Micronesia, Guam, Marshall Islands, and Republic of Palau
Region 10 - Seattle
• Alaska, Idaho, Oregon, and Washington
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DRG changes occur at the individual code level. Coding errors are classified as either technical or clinical errors.
- Technical coding errors involved inappropriate application of the ICD-10-CM/PCS coding guidelines.
- Clinical coding errors were reviewed by Livanta physician reviewers and involved a lack of evidence to support the diagnosis represented by the code.
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Most code disagreements were technical in nature and involved inappropriate sequencing or lack of documentation found to support an added diagnosis that changed the DRG. |
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Reasons for DRG Change by Livanta |
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The most frequent reasons for HWDRG errors, as noted in the table above, are:
- Changing the principal diagnosis and/or finding no documentation in the medical record to support an added diagnosis (67 percent, combined).
- The principal diagnosis did not meet the accepted definition (16 percent).
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The table below shows the top 10 DRGs that resulted in Livanta reversing the HWDRG to the previously billed DRG. |
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Overall, 4,438 HWDRGs (67 percent) were reversed to the previously billed DRG based on the documentation submitted in the medical record to support the HWDRG claim. |
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1. Selection of a principal diagnosis that is not supported by the medical record and coding guidelines.
2. Submission of a major complication or comorbidity (MCC) or CC that is not supported by the documentation in the medical record. Common diagnoses in this category are sepsis, encephalopathy, and malnutrition.
Read Livanta’s October 2022 publication on encephalopathy:
Read Livanta’s April 2023 publication on malnutrition:
3. Inappropriate query submissions and unsupported responses.
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The top 10 HWDRGs found to be in error are noted in the table below. |
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Sepsis DRGs (871 and 872) comprise the largest percentage of HWDRGs found to be in error. DRG 811 (red blood cell disorders with MCC) accounted for the second largest percentage of HWDRG errors. |
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Based on HWDRG claim reviews conducted by Livanta, many hospitals could benefit from focused training on proper documentation and coding guidelines. Accurate coding based on the coding conventions and guidelines, along with thorough documentation in the medical record, helps ensure proper claim submission and payment.
Please e-mail Livanta at Claimreview@Livanta.com if your hospital is interested in focused training on specific coding topics.
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Livanta is the national Medicare Claim Review Services contractor under the Beneficiary and Family Centered Care – Quality Improvement Organization (BFCC-QIO) Program. As the Claim Review Services contractor, Livanta validates the DRG on hospital claims that have been adjusted to pay at a higher weight. The adjusted claim is reviewed to ensure that the diagnoses, procedures, and discharge status of the patient reported on the hospital’s claim are supported by the documentation in the patient’s medical record. Livanta’s highly trained credentialed coding auditors adhere to the accepted principles of coding practices to validate the accuracy of the hospital codes that affect the DRG payment. When needed, actively practicing physicians review for medical necessity and clinical validity based on the presence of supporting documentation and clinical indicators.
Post-payment review of these HWDRG adjustments is mandated under statute and in the Centers for Medicare & Medicaid Services (CMS) QIO Manual: Perform DRG validation on prospective payment system (PPS) cases (including hospital-requested higher-weighted DRG assignments), as appropriate (see §1866(a)(1)(F) of the Act and 42 CFR 476.71(a)(4)).
Read more: CMS, Quality Improvement Organization Manual, Chapter 4 - Case Review
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ABOUT LIVANTA LLC AND THIS DOCUMENT - Disclaimer
This material was prepared by Livanta LLC, the Medicare Beneficiary and Family Centered Care - Quality Improvement Organization (BFCC-QIO) under national contract with the Centers for Medicare & Medicaid Services (CMS), an agency of the U.S. Department of Health and Human Services. The contents presented do not necessarily reflect CMS policy and are intended for educational purposes only. 12-SOW-MD-2024-QIOBFCC-TO339
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