HAC Coding Impacts Hospital Financial Performance

Original story posted on: March 4, 2019

HAC coding impacts hospital financial performance.

Hospital-acquired conditions (HACs) have been reported on hospital claims since FY 2008. Payments to hospitals ranking in the lowest-performing quartile were adjusted by 1-percent reductions beginning Oct. 1, 2014. This program is known as the Hospital-Acquired Conditions Reduction Program, and it is part of value-based purchasing.

For FY 2019, the 75th-percentile total HAC score cutoff was 0.3429. The cutoff for FY 2018 was 0.3712. From 2014 through 2018, the decrease represented a 13 percent improvement. This change signifies a difference of 99 patients out of 1,000 in 2014 to 86 patients out of 1,000 in 2018.  

The HAC Reduction Program information is reported for each hospital on Hospital Compare. The aforementioned significant improvement has saved $7.7 billion in Medicare payments.

The HAC Reduction Program leverages Domain 1 and Domain 2 scores. Domain 1 includes the Centers for Medicare & Medicaid Services (CMS) Patient Safety Indicators (PSIs) 90. For FY 2019, the calculations are based on the 21-month performance period of Oct. 1, 2015-June 30, 2017, which includes only ICD-10-CM data. PSI 90 includes:

  1. PSI 03 – Pressure Ulcer Rate
  2. PSI 06 – Iatrogenic Pneumothorax Rate
  3. PSI 08 – In Hospital with Hip Fracture Rate
  4. PSI 09 – Peri-operative Hemorrhage or Hematoma Rate
  5. PSI 10 – Postoperative Acute Kidney Injury Requiring Dialysis Rate
  6. PSI 11 – Postoperative Respiratory Failure Rate
  7. PSI 12 – Peri-operative Pulmonary Embolism or Deep Venous Thrombosis Rate
  8. PSI 13 – Postoperative Sepsis Rate
  9. PSI 14 – Postoperative Wound Dehiscence Rate
  10. PSI 15 – Unrecognized Abdominopelvic Accidental Puncture/Laceration Rate

Domain 2 focuses on infections using the Centers for Disease Control and Prevention (CDC) chart abstract and lab surveillance data from the National Healthcare Safety Network (NHSN). It encompasses data on discharges taking place from Jan. 1, 2016 through Dec. 31, 2017, and includes the indicators of:

  1. Central Line-Associated Blood Stream Infection (CLABSI);
  2. Catheter-Acquired Urinary Tract Infection (CAUTI);
  3. Surgical Site Infections (SSI);
  4. Methicillin-Resistant Staphylococcal Aureus (MRSA) Bacteremia; and
  5. Clostridium Difficile (C. Diff) Infection rates.

For FY 2019, the total HAC score is a weighted average of Domain 1 and Domain 2. Payment adjustments will be made for all Medicare discharges taking place from Oct. 1, 2018 through Sept. 30, 2019.

The reporting of these conditions with the associated present-on-admission (POA) indicator is what determines if the condition is a HAC. Health information management (HIM) coders should query the physician or have a discussion with their facility’s quality staff to determine if a condition is present on admission when the situation is murky. This statement is supported by the 2019 ICD-10-CM Reporting and Coding Guidelines. 

HACs are a drain on any facility’s finances, as they add cost and increase the length of stay (LOS). The 2016 data revealed that 48,771 HACs resulted in 3,219 potentially avoidable deaths, with an added LOS of 8.17 days and a 72.32 percent increase in mortality. The expense of treating the HACs was $41,917 beyond the average hospital cost per HAC patient. A total of 769 hospitals had their Medicare payments reduced for FY 2017.

HIM can assist in managing this by:

  1. Knowing which conditions are HACs;
  2. Identifying go-to people in quality for questions;
  3. Including documentation sources for HACs for coding purposes;
  4. Holding regular meetings with quality to discuss regulations, code changes, and/or problem cases; and
  5. Reviewing the current data to understand performance.

Managing this program is very much a team activity. It takes knowledge of HIM and quality to improve each facility’s performance. It is important to share information, as there are differences between clinical and coding understanding. There are times when sharing information that documentation is not accurate or noting that the coder was using the physician’s staging of the pressure ulcer rather than the wound care nurse documentation is critical. The combination of quality and HIM creates a combination of performance and data

Program Note:

Listen to Laurie Johnson live today on Talk Ten Tuesday, 10-10:30 a.m. EST.

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Laurie Johnson, MS, RHIA, CPC-H, FAHIMA, AHIMA-Approved ICD-10-CM/PCS Trainer

Laurie M. Johnson, MS, RHIA, FAHIMA is currently a senior healthcare consultant for Revenue Cycle Solutions, based in Pittsburgh, Pa. Laurie is an American Health Information Management Association (AHIMA) approved ICD-10-CM/PCS trainer. She has more than 35 years of experience in health information management and specializes in coding and related functions. She has been a featured speaker in over 40 conferences. Laurie is a member of the ICD10monitor editorial board and makes frequent appearances on Talk Ten Tuesdays.

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