Highlights of FY 2022 IPPS Final Rule

By Matt Kerschner, MPA, and Sue Bowman, MJ, RHIA, CCS, FAHIMA

The Medicare Hospital Inpatient Prospective Payment System (IPPS) final rule for fiscal year (FY) 2022 was published in the August 13th edition of the Federal Register. This final rule is effective October 1, 2021. On June 24th, AHIMA submitted comments in response to the proposed rule.

Changes to Specific MS-DRG Classifications

Due to the number of MS-DRG classification changes for FY 2022, only a few of the changes are highlighted below.

The Centers for Medicare and Medicaid Services (CMS) finalized its proposal to delay the application of the non-CC (complication/comorbidity) subgroup criteria to existing MS-DRGs with a three-way severity level split until FY 2023 or later, and finalized for FY 2022 to maintain the current structure of the 32 MS-DRGs that currently have a three-way severity level split.

CMS is finalizing its proposal to assign 16 new ICD-10-PCS procedure codes (effective with discharges on or after October 1, 2021) describing CAR T-cell, non-CAR T-cell, and other immunotherapies to Pre-MDC MS-DRG 018 and to modify the MS-DRG title to “Chimeric Antigen Receptor (CAR) T-cell and Other Immunotherapies” to better reflect the cases reporting the administration of non-CAR T-cell therapies and other immunotherapies. The agency plans to continue engaging with stakeholders on additional options for consideration in this field of cellular and gene therapies, such as the creation of new and distinct MS-DRGs and to determine if the creation of a new MDC (Major Diagnostic Category) may be warranted to which unique MS-DRGs could be established and the appropriate corresponding procedure codes could be proposed for assignment.

Cases with a procedure code describing coronary bypass and a procedure code describing open ablation have been reassigned to MS-DRGs 233 and 234 and the titles of these MS-DRGs have been changed to Coronary Bypass with Cardiac Catheterization or Open Ablation with and without MCC, respectively.

Three procedure code combinations describing removal and replacement of the right knee joint that were inadvertently omitted from the logic have been added to MS-DRGs 461, 462 (Bilateral or Multiple Major Joint Procedures of Lower Extremity with and without MCC, respectively), MS-DRGs 466, 467, and 468 (Revision of Hip or Knee Replacement with MCC, with CC, and without CC/MCC, respectively), and MS-DRGs 628, 629, and 630 (Other Endocrine, Nutritional and Metabolic O.R. Procedures with MCC, with CC, and without CC/MCC, respectively). Eleven additional code combinations involving procedures on the right knee joint that were omitted from the logic for MS-DRGs 628, 629, and 630 have also been added to these MS-DRGs for FY 2022.

Operating Room (OR) and Non-OR Issues

Several ICD-10-PCS procedures have been redesignated from extensive OR procedures to non-extensive OR procedures and reassigned from MS-DRGs 981, 982, and 983 (Extensive OR Procedure Unrelated to Principal Diagnosis with MCC, with CC, without CC/MCC, respectively) to MS-DRGs 987, 988, and 989 (Non-Extensive Procedure Unrelated to Principal Diagnosis with MCC, with CC, without CC/MCC, respectively) for FY 2022. These procedure codes include three codes describing excision of subcutaneous tissue from the chest, back, and abdomen, 31 codes describing laser interstitial thermal therapy, three codes describing repair of the esophagus via percutaneous approach, natural or artificial opening approach, and natural or artificial opening endoscopic approach, and one code describing drainage of urethra, open approach.

CMS finalized its proposal to change the designation of 22 procedure codes describing open drainage of subcutaneous tissue and fascia from OR procedures to non-OR procedures. These procedure codes have also been redesignated as non-OR procedures: insertion of feeding device into stomach, open approach; endoscopic extirpation of matter from the kidney, kidney pelvis, and ureter; and drainage of vestibular gland, diagnostic, open or external approach.

The designation of the following procedures was changed from non-OR to OR procedure:

  • Percutaneous introduction of substance into cranial cavity and brain
  • Open pleural biopsy
  • Percutaneous revision of intraluminal vascular devices
  • Percutaneous repositioning with internal fixation of the sacroiliac and hip joints
  • Insertion or removal of spacer into shoulder joint via open or percutaneous endoscopic approach
  • Extirpation of matter from the upper or lower jaw via open or percutaneous endoscopic approach
  • Open extirpation of matter from the subcutaneous tissue and fascia
Unspecified Diagnosis Codes—Severity Level Designation and Medicare Code Editor (MCE) Edit

In the FY 2022 IPPS proposed rule, CMS had proposed changing the severity level designation of all “unspecified” ICD-10-CM diagnosis codes to a non-CC where there are other codes available in that code subcategory that further specify the anatomic site, specifically codes that identify laterality. CMS stated that changing the severity level for these “unspecified codes” as compared to the more specific codes in the same subcategory recognizing laterality would leverage the additional specificity available under the ICD-10 system, by fostering the reporting of the most specific diagnosis codes supported by the available medical record documentation and clinical knowledge of the patient’s health condition to more accurately reflect each healthcare encounter and improve the reliability and validity of the coded data. In the final rule, however, CMS did not finalize this proposal and is maintaining the current severity level designation of these “unspecified” codes. CMS stated in the final rule that while the agency remains committed to fostering the documentation and reporting of the most specific diagnosis codes supported by the available medical record documentation and clinical knowledge of the patient’s health condition, they believe additional time is needed before adopting a change to the severity level designation of all “unspecified” diagnosis codes to a non-CC where there are other codes available in that code subcategory that further specify laterality. This additional time will allow the industry an opportunity to educate coding professionals on the updated official coding guidelines (which have been modified to allow coding of laterality to be based on medical record documentation of clinicians other than the patient’s provider) and to offer assistance on proper documentation to providers.

While CMS did not finalize the proposed change in severity level designation for codes for unspecified laterality, implementation of the proposed new MCE edit for “unspecified” codes (where there are more specific codes available in that code subcategory that identify laterality) was finalized. CMS believes that the MCE edit provides additional time to educate providers while not affecting the payment the provider is eligible to receive. Modifications were made to the final list of codes subject to this edit based on public comments, such as the deletion of neoplasm codes. When a code from this list is entered on the claim, the edit will be triggered. It is the provider’s responsibility to determine if a more specific code from that subcategory is available in the medical record documentation. If, upon review, additional information to identify the laterality from the available medical record documentation by the patient’s provider or other clinicians is unable to be obtained, or there is documentation in the record that the physician is clinically unable to determine the laterality because of the nature of the disease or condition, then the provider must enter that information into the remarks section on the claim. If there is no language entered into the remarks section as to the availability of additional information to specify laterality and the provider submits the claim for processing, the claim will be returned to the provider. In consideration of commenters’ concerns that more time is needed to educate providers, the implementation date for this new MCE edit is April 1, 2022, and so it is effective for discharges on and after April 1, 2022.

April 1 Implementation Date for ICD-10-CM/PCS Code Updates

In the final IPPS rule, CMS adopted an April 1 implementation date for ICD-10-CM/PCS code updates (in addition to the annual October 1 update), beginning with April 1, 2022. The intent of this April 1 implementation date is to allow flexibility in the ICD-10-CM/PCS code update process. CMS is recommending a phased-in approach with limited April 1 code updates. CMS believes this additional April 1 implementation date for new codes would allow for earlier recognition of diagnoses, conditions, and illnesses as well as procedures, services, and treatments in the claims data. The agency also believes this earlier recognition would be beneficial for purposes of reporting, data collection, tracking clinical outcomes, claims processing, surveillance, research, policy decisions, and data interoperability.

Approved FY 2022 Applications for Add-on Payments for New Services and Technologies

New technologies for which FY 2022 applications for New Technology Add-on Payments (NTAPs) were approved are listed below. Except where otherwise noted, new ICD-10-PCS codes for these technologies become effective October 1, 2021.

  • RYBREVANT™ (Amivantamab Monoclonal Antibody)
  • COSELA (trilaciclib)
  • ABECMA® (idecabtagene vicleucel)
  • StrataGraft™ Skin Tissue
  • TECARTUS® (brexucabtagene autoleucel)
  • VEKLURY® (remdesivir)
  • ZEPZELCA™ (lurbinectedin)
  • Aprevo™ Intervertebral Body Fusion Device (customizable interbody fusion)
  • aScope™ Duodeno (single use duodenoscope)
  • Caption Guidance™ (artificial intelligence guided medical imaging acquisition software system)
  • EXALT™ Model D Single-Use Duodenoscope
  • Harmony™ Transcatheter Pulmonary Valve (TPV) System
  • INTERCEPT Fibrinogen Complex (PRCFC)
  • Shockwave C2 Intravascular Lithotripsy (IVL) System
  • CONTEPO™ (fosfomycin), ICD-10-PCS code became effective FY 2020
  • FETROJA® (cefiderocol), ICD-10-PCS code became effective FY 2021
  • RECARBRIO™ (imipenem, cilastatin, and relebactam), ICD-10-PCS code became effective FY 2020
EHR Reporting Period

CMS is finalizing its proposal that for CY 2024 the electronic health record (EHR) reporting period for the Medicare Promoting Interoperability (PI) program will be increased to a minimum of any continuous 180-day period in CY 2024 for new and returning participants in the Medicare Promoting Interoperability Program. This is an increase from the continuous 90-day period that is currently in place.

Proposed Changes to the Provide Patients Electronic Access to Their Health Information Measure Under the Provider to Patient Exchange Objective

In a significant win for AHIMA, CMS will not be finalizing a proposal that would have required eligible hospitals and critical access hospitals (CAHs) to ensure that patient health information remains available to the patient (or patient-authorized representative) to access indefinitely, using any application of their choice that is configured to meet the technical specifications of the API in the eligible hospital or CAHs CEHRT. AHIMA had significant concerns related to the potential burdens and security risks that the “indefinite” retention requirement would create. In their commentary explaining their decision to rescind this proposal, the agency cited several arguments made by AHIMA in our comment letter.

Proposed Changes to the Query of Prescription Drug Monitoring Program (PDMP) Measure under the Electronic Prescribing Objective

CMS is finalizing a proposal to maintain the Query of PDMP measure as optional within the PI program while increasing its associated bonus points from five points to 10 points for the EHR reporting period in CY 2022. As a result, the maximum total points available for the Electronic Prescribing Objective will increase to 20 points for the EHR reporting period in CY 2022.

Health Information Exchange Objective: Engagement in Bi-directional Exchange Through Health Information Exchange

CMS is finalizing a proposal to add a new measure under the Health Information Exchange (HIE) objective for engagement in bi-directional exchange. The new measure will be added to the Medicare PI Program as an optional measure and will be worth 40 points beginning with the EHR reporting period in CY 2022. This measure will be an alternative to reporting on the two pre-existing HIE objective measures: The Support Electronic Referral Loops by Sending Health Information measure and the Support Electronic Referral Loops by Receiving and Reconciling Health Information measure. PI program participants may either report the two existing measures and associated exclusions or may choose to report the new measure. The HIE Bi-Directional Exchange measure will be worth 40 points. The HIE Bi-Directional Exchange measure will be reported by attestation and require a yes/no response.

Modifications to the Public Health and Clinical Data Exchange Objective

CMS is finalizing its proposal to require four of the measures associated with the Public Health and Clinical Data Exchange Objective, beginning with the EHR reporting period in CY 2022: Syndromic Surveillance Reporting; Immunization Registry Reporting; Electronic Case Reporting; and Electronic Reportable Laboratory Result Reporting. Previously, PI program participants were required to report on any two measures of their choice from the following six measures: Syndromic Surveillance Reporting; Immunization Registry Reporting; Clinical Data Registry Reporting; Electronic Case Reporting; Public Health Registry Reporting; and Electronic Reportable Laboratory Result Reporting. Under the new policy, if a PI program participant fails to report on any one of the four measures required for this objective or reports a ‘‘no’’ response for one or more of these measures, the participant would receive a score of zero for the Public Health and Clinical Data Exchange objective, and a total score of zero for the Medicare Promoting Interoperability Program.

SAFER Guides

CMS is finalizing proposal to add a new SAFER Guides measure to the Protect Patient Health Information objective beginning with the CY 2022 EHR reporting period. PI program participants must attest to having conducted an annual self-assessment of all nine SAFER Guides at any point during the calendar year in which the EHR reporting period occurs, with one ‘‘yes/no’’ attestation statement accounting for a complete self-assessment using all nine guides. Although this measure will be required, eligible hospitals and CAHs are not being scored on this measure, and an attestation of ‘‘yes’’ and ‘‘no’’ are both acceptable answers without penalty.

Actions to Limit or Restrict the Compatibility or Interoperability of CEHRT

CMS is finalizing a proposal to modify the existing attestation statements relating to actions to limit or restrict the compatibility or interoperability of CEHRT. CMS will be eliminating two of the existing three attestation statements. Starting in CY 2022, program participants will need to attest to a single statement, that the program participant “did not knowingly and willfully take action (such as to disable functionality) to limit or restrict the compatibility or interoperability of certified EHR technology.”

Sue Bowman ([email protected]) is senior director, coding policy and compliance, and Matthew Kerschner ([email protected]) is director, regulatory affairs at AHIMA.

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