Updated on: November 29, -0001

Understanding the Impact of ICD-10 on DRGs

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Original story posted on: May 12, 2014

Leveraging data analytics is a great way to identify areas for coding improvement and target opportunities for ICD-10 education.

Organizations can use this strategy to evaluate General Equivalence Mappings (GEMs) of claims data, thus identifying high-risk areas and mitigating potential decreases in case mix index (CMI) and corresponding financial impacts. Once high-risk areas have been identified at the diagnosis-related group (DRG) level, auditing medical records will reveal the actual impacts – or lack thereof – of current coding and clinical documentation practices, yielding valuable insight on possible deficiencies and areas for improvement. 

DRGs: Potential Revenue Impact

Why do certain DRGs have a high potential for revenue impact? Coming from a coding background, I wanted to understand exactly what the impact of the different coding systems, ICD-9 and ICD-10, would be on individual DRGs – and, more importantly, why the impact occurred. I began analyzing data analytics reports, and I started questioning why certain DRGs had a higher potential for financial impact than others. For instance, if there are four stents inserted and coded in ICD-9, wouldn’t I still be coding four stents in ICD-10? What changes could there possibly be? After reviewing a plethora of operative reports, I realized that these stent procedure cases will be an area of high financial impact due to the difference in classification systems and how that difference affects the grouper logic for DRG assignment. As a result, the direct impact on an organization’s revenue actually will be in proportion to its volume of cases. It is important to note that not all stent cases will be regrouped to the lower-severity DRG; this applies only in certain clinical scenarios. By combining the data analytics with record review, I was able to ascertain specific clinical examples.   

The impact of classifying in ICD-9 versus ICD-10

To illustrate the impact the difference in classification systems can have on a DRG, let’s take a look at these two pairs of stent procedures:

  • MS-DRG 246 Percutaneous Cardiovascular Procedure with Drug-Eluting Stent with MCC or 4+ Vessels/Stents (RW 3.1830)
  • MS-DRG 247 Percutaneous Cardiovascular Procedure with Drug-Eluting Stent without MCC (RW 2.0408)

and

  • MS-DRG 248 Percutaneous Cardiovascular Procedure with Non-Drug-Eluting Stent with MCC or 4+ Vessels/Stents (RW 2.9479)
  • MS-DRG 249 Percutaneous Cardiovascular Procedure with Non-Drug-Eluting Stent without MCC (RW 1.8245)

Both of these DRG pairs are classified according to:

  1. The type of stent inserted;
  2. If there was a major complication or comorbid condition present; and
  3. If there were four or more stents inserted. 

But what is important to note is that the driving force for these DRGs is the fact that both pairs are shifted to the higher relative weight by either: a) a major complication comorbidity (MCC) or b) the use of four or more stents.  

To better understand the impact ICD-10 will have on DRG assignment, one must understand how these codes are assigned in ICD-9. In ICD-9, these procedures are coded to report:

  • The number of vessels treated;
  • The number of stents inserted;
  • The type of stent used (drug-eluting or non-drug-eluting); and
  • The percutaneous transluminal coronary angioplasty. 

If the codes for the number of vessels and number of stents reflect quantities of four or more, the DRG is assigned to the higher severity for either pair – it simply depends on the type of stent used and does not take into account the presence of major complications and comorbidities (MCCs).

In ICD-10, the change in DRG assignment is the direct result of the classification of the coronary arteries as a single body site, which is then further specified by the number of sites treated, not by the number or name of the coronary arteries. Therefore, clinically, the cardiologist could insert four stents; however, if two of the four stents are treating one lesion at one site, the total sites treated would be reported as three in ICD-10. Although the treatment of three sites is accomplished with the insertion of four stents, the procedure is reflected as less than four, thereby being grouped into the “lower severity” DRG. The result is that the codes do not appropriately reflect the case severity, which can lead to a potential revenue loss depending on whether the case will be paid under a DRG-based payer contract. 

Regardless of precisely when ICD-10 implementation occurs, accurate documentation will be the key to maintaining financial integrity. Procedures involving stents mark just one example of how organizations can begin leveraging their data analytics to identify high-risk areas and target opportunities for improved ICD-10 education.

Preparing your physicians, clinical documentation specialists, and coding professionals well in advance of the deadline and providing them with the proper tools and training will yield better outcomes and make the transition more seamless.

About the Author

Lisa Roat, RHIT, CCS, CCDS is manager of HIM Services for Nuance Healthcare.   She has more than 23 years of experience and expertise within the healthcare industry specializing in clinical documentation improvement, coding education, reimbursement methodologies and healthcare quality for hospitals.  She is an American Health Information Management (AHIMA)- Approved ICD-10 CM/PCS Trainer and Ambassador.  Lisa has worked extensively with the development of ICD-10 education and services for Nuance Healthcare.

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Disclaimer: Every reasonable effort was made to ensure the accuracy of this information at the time it was published. However, due to the nature of industry changes over time we cannot guarantee its validity after the year it was published.
Lisa Roat, RHIT, CCS, CCDS

Lisa Roat, RHIT, CCS, CCDS is manager of HIM Services for Nuance Healthcare. She has more than 23 years of experience and expertise within the healthcare industry specializing in clinical documentation improvement, coding education, reimbursement methodologies and healthcare quality for hospitals. She is an American Health Information Management (AHIMA)- Approved ICD-10 CM/PCS Trainer and Ambassador. Lisa has worked extensively with the development of ICD-10 education and services for Nuance Healthcare.