January 2016

ICD-10 and the Order of Things
By Selena Chavis
For The Record
Vol. 28 No. 1 P. 10

Sequencing holds the key to accurate MS-DRG assignment.

Hospitals and health systems across the nation are holding their breath as the full revenue cycle impact of the ICD-10 transition comes into focus. With far-reaching tentacles that touch nearly every area of operations, the mammoth ICD-10 undertaking has even the most prepared organizations facing uncertainty as they wait for the dust to settle.

Critical to effectively managing revenue within the new system is the ability to accurately capture Medicare severity diagnosis-related groups (MS-DRGs). Coders must choose and assign codes in the correct order—often referred to as sequencing—to ensure the highest level of reimbursement.

"Sequencing lists codes in order based on severity of illness (SOI) and resources utilized," explains Amy Bridge, CCS, CIRCC, executive director of coding for AGS Health. "Those with a higher SOI and resource utilization are the same codes that can change a DRG from a lower reimbursement to a higher reimbursement."

While HIM professionals recognize the relationship between sequencing and reimbursement, industry experts agree that ICD-10 presents new challenges. The increase from approximately 13,000 ICD-9 codes to approximately 68,000 ICD-10 codes requires more detailed and thorough documentation from physicians, as well as a clear understanding on the part of coders as to the nuances and differences between the two coding systems.

Why Sequencing Is Important
Angela Carmichael, MBA, RHIA, CCS, CCS-P, an HIM product development specialist at J.A. Thomas and Associates, points out that sequencing drives selection of the principal diagnosis, adding that it's a critical responsibility of the inpatient coder to ensure an accurate MS-DRG assignment is made. "It is a key decision that directly impacts reimbursement, compliance, and readmission rates via core measures," she says, pointing out that physician documentation must thoroughly back up the final choice. "Documentation must clearly indicate that any potential principal diagnosis was in fact present on admission, as opposed to a condition that arose after admission."

The principal diagnosis is defined in the Uniform Hospital Discharge Data Set as "the condition established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care." Final MS-DRG assignments are based on the principal diagnosis and secondary diagnoses, the principal procedure and secondary procedures, sex, and discharge status, all of which are characterized through ICD-10 codes.

Once a principal diagnosis is assigned at the highest level of severity, a secondary diagnosis can be chosen. Classified as complications/comorbidities (CCs) or major CCs (MCCs), the presence or absence of a CC or an MCC code as a secondary diagnosis changes the DRG, Bridge notes. When documentation does not support an appropriate CC or MCC, or a secondary diagnosis is not accurately captured, the level of reimbursement can be negatively impacted.

To accurately select the correct principal diagnosis and code at the highest level of reimbursement, Carmichael says HIM professionals must review the entire medical record and apply official coding guidelines found in the coding conventions within the code book or encoder, the ICD-10-CM Official Guidelines for Coding and Reporting for fiscal year 2016, or the Coding Clinic, published by the American Hospital Association. She adds that an advanced practice clinical documentation improvement (CDI) program is essential for accurate sequencing because it helps "eliminate ambiguous, incomplete, or conflicting documentation that impedes the speed and accuracy in the selection of the principal diagnosis and prevents postdischarge clarifications."

When documentation practices are optimized to ensure the highest level of coding, health care organizations can decrease their discharged not final billed accounts to improve revenue cycle performance. Carmichael points out that within the ICD-10 framework, strategies to improve documentation are especially necessary as physicians become accustomed to recording care with the granularity required for accurate coding. In fact, she suggests that gaps in documentation practices already are eroding coder productivity following the transition, citing an increase in the back-and-forth necessary to clarify patient conditions.

"Approximately 40% of concurrent clarifications are for identification of the most appropriate principal diagnosis," Carmichael says, pointing to the need for better infrastructures and processes to support coder productivity. "Computer-assisted coding technology can improve coder productivity, but it does not identify the principal diagnosis and cannot replace, or eliminate, the need for a robust CDI program to fully leverage the benefits of ICD-10's granularity."

Sequencing Within the ICD-10 Framework
The good news, according to Wendy Deaton, RHIT, CCS, CCS-P, an AHIMA-approved ICD-10-CM/PCS trainer and the ICD-10 services manager for LexiCode, is that there are relatively few changes to the sequencing guidelines in ICD-10 when compared with ICD-9. While that may be a relief for many HIM professionals, she cautions that health care organizations should not let their guard down.

"It is recommended that facilities consider undergoing quarterly MS-DRG or APR [All Patient Refined]-DRG audits to confirm that their coders are sequencing correctly per the Official Guidelines," Deaton says. "Comprehensive DRG audits can assist facilities in determining how their coders are performing to ensure that their staff is capturing the PDX [primary diagnosis] and all of the CCs and MCCs for an inpatient encounter."

According to Deaton, sequencing differs between ICD-9 and ICD-10 in the following key areas:

• anemia due to neoplasm;
• anemia due to a chronic disease;
• admission for palliative care;
• admission for rehabilitation; and
• changes to instructional notes in the ICD-10 tabular (eg, gangrenous pressure ulcer).

Some of the changes related to MCCs and CCs include the following:

• major depressive disorder: CC deletion;
• malignant HTN (hypertension): CC deletion;
• Prinzmetal angina: CC deletion;
• second-degree heart block: CC deletion;
• Schatzki's ring: MCC deletion; and
• acute respiratory distress: CC deletion.

According to Bridge, the Centers for Medicare & Medicaid Services (CMS) created the following new MS-DRGs:

• MS-DRG 268 (Aortic and Heart Assist Procedures Except Pulsation Balloon with MCC);
• MS-DRG 269 (Aortic and Heart Assist Procedures Except Pulsation Balloon without MCC);
• MS-DRG 270 (Other Major Cardiovascular Procedures with MCC);
• MS-DRG 271 (Other Major Cardiovascular Procedures with CC);
• MS-DRG 272 (Other Major Cardiovascular Procedures without CC/MCC);
• MS-DRG 273 (Percutaneous Intracardiac Procedures with MCC); and
• MS-DRG 274 (Percutaneous Intracardiac Procedures without MCC).

Also, CMS deleted the following MS-DRGs:
• MS-DRG 237 (Major Cardiovascular Procedures with MCC); and
• MS-DRG 238 (Major Cardiovascular Procedures without MCC).

Deaton notes that a complete list of the 2016 CCs and MCCs effective with October 1, 2015, discharges can be found on the CMS website.

Aftercare Considerations
Along with the nuances associated with changes to CC and MCC codes in ICD-10, industry professionals also point to changes in aftercare coding. According to Bridge, the biggest change revolves around the use of Z codes, a new set of codes that replaces ICD-9's V codes. In fact, all previous V57 codes now map to a single ICD-10 code: Z51.89.

According to the AHIMA website: "Aftercare codes identify specific types of continuing care after the initial treatment of an injury or disease. V-code subcategories [in ICD-9] for orthopedic aftercare (V54.1 and V54.2) specify encounters following initial treatment of fractures. Coding guidelines state that a fracture code from the main classification can be used only for an initial encounter. Subsequent encounters that usually occur in an outpatient, home health, or long term care facility now have the ability to report the type and site of fractures within the new subcategory sections. Orthopedic aftercare visit coding guidelines differ in ICD-10-CM in that Z codes should not be used if treatment is directed at the current injury. If treatment is directed at the current injury, the injury code should be reported with a seventh-character extension to identify the subsequent encounter. The purpose of assigning the extension is to be able to track the continuity of care while identifying the type of injury. While aftercare codes are used for a resolving or long-term condition, follow-up codes are used for conditions that require continuing surveillance following completed treatment of a disease, condition, or injury. ICD-9-CM coding guidelines state that follow-up codes are listed first unless a condition has recurred on the follow-up visit, then the diagnosis code should be listed first in place of the follow-up code."

In a nutshell, "one should not use aftercare Z codes if the patient's primary diagnosis code includes a seventh character that designates the encounter type," Bridge explains.

Carmichael notes that physicians are confused about when to assign an aftercare code as opposed to an acute injury code with a seventh-character extension. There's also confusion about which seventh-character extension to assign. "Physicians are confusing the use of the seventh-character extensions 'A' for initial encounter and 'D' for subsequent encounter with new and established patient visits described in CPT," Carmichael says. "It has been necessary to explain to physicians that they are to choose the appropriate seventh character based on the care the patient received and not on whether the patient is seeing a new or different physician."

Aftercare coding is now dependent upon whether the condition is surgical in nature or resulting from trauma, Deaton notes. "Physician documentation is key to determine the difference," she says. "It is recommended that facilities take a look at their current physician documentation practices. Physician documentation audits and CDI training can assist the facilities in enhancing documentation practices by the physicians which will be needed to code in ICD-10."

Procedure-Driven MS-DRG Shifts
The transition to ICD-10-PCS has resulted in MS-DRG shifts, some of which are appropriate, while others are likely unintentional and a result of grouper logic issues, according to Carmichael. "These are minor procedures that meet the reporting guidelines but should not impact MS-DRG assignment," she says. "However, now when coding according to ICD-10-PCS root operation definitions, code to procedures that impact the DRG assigned."

According to the AHIMA website, procedure coding differs greatly between ICD-9 and ICD-10. The organization notes, "Some procedures that were reported with a single code in ICD-9 require two codes in ICD-10. To handle this reporting difference, grouper logic for ICD-10 includes a number of procedure codes that result in a different DRG when reported alone vs when reported along with another procedure code."

Deaton offers the following example:
In ICD-9, a knee or hip revision was captured with one procedure code, (knee: 00.80–00.84) or (hip: 00.70–00.77), which grouped to MS-DRG 468, Revision of Hip or Knee Replacement without CC/MCC. In ICD-10-PCS, two PCS codes are required to ensure the correct MS-DRG of 468: 0SPD0JZ, Removal of Synthetic Substitute from Left Knee Joint, Open Approach, and 0SRU0JZ, Replacement of Left Knee Joint, Femoral Surface with Synthetic Substitute, Open Approach. If the coder assigns only 0SRU0JZ, then the MS-DRG assigned is 470, Major Joint Replacement or Reattachment of Lower Extremity without MCC, which does not adequately describe the procedure performed.

Deaton offers another example in which a patient with pneumonia (J18.9) undergoes a bronchoscopy with aspiration (drainage) of the left lower lobe bronchus (0B9B8ZZ). The aspiration of the bronchus in the current MS-DRG grouper takes this to a surgical MS-DRG of 165, Major Chest Procedures without CC/MCC, a significant increase in reimbursement compared with the ICD-9 MS-DRG of 195, Simple Pneumonia and Pleurisy without CC/MCC.

Focus on Body Parts
The increase in ICD-10 specificity, much of it related to body parts, means that HIM professionals need to be well-versed in anatomy. For example, Bridge points out that under ICD-9 guidelines, pain in extremity is coded to 729.5 (pain in limb), regardless of where the pain originated. ICD-10 guidelines offer 21 different codes for the same issue based on the specific body part (finger, forearm, hand, etc) and laterality (ie, right, left, unspecified).

Carmichael offers the example of nonexcisional debridement. "The root operation for a nonexcisional debridement is 'extraction,'" she says. "An extraction of skin is not a valid OR [operating room] procedure; however, an extraction of subcutaneous tissue/fascia in ICD-10-PCS is a valid OR procedure. Clinical documentation specialists should ensure that the documentation in the record identifies the depth of all nonexcisional debridements to ensure appropriate coding and reimbursement."

Because the body part value can affect the overall PCS code assignment—and in some instances the final MS-DRG—Deaton says every value of the seven-character PCS code is important. "Assigning the body part of bronchus instead of lung, or arm instead of skin of arm, results in separate PCS codes which do not reflect the procedure being performed, the risk to the patient, and the resources used by the facility," she points out. "These types of inadvertent errors can impact the overall reimbursement which could be costly to facilities."

It's a lesson many organizations are learning as more of the intricacies of ICD-10 coding become apparent during these early days of implementation.

— Selena Chavis is a Florida-based freelance journalist whose writing appears regularly in various trade and consumer publications covering everything from corporate and managerial topics to health care and travel.