DRGs & MS-DRGs. System that takes into consideration the role that a hospitals case mix plays in influencing costs

Transcription

1 DRGs & MS-DRGs What are DRGs? System that takes into consideration the role that a hospitals case mix plays in influencing costs Relates the type of patients a hospital treats (case mix) to the costs incurred Groups like-patients with like-resource consumption and LOS patterns together Shows the clinical complexity and consumption of hospital resources DRGs were the first system to allow the measurement of a hospital s case mix (CM) complexity Direct measure of the resource consumption and therefore the cost of providing care A hospital with a complex CM means that the hospital patients are consuming more resources and therefore the cost of care is higher A complex case mix in DRG terms does not imply that the hospital treats patients having a greater severity of illness, higher risk of mortality, greater treatment difficulty, poorer prognosis, or greater need for intervention In order to be practical and meaningful, the DRG system needed to meet the following (4) criteria: Patient characteristics used in the definition of DRGs should be limited to information routinely collected in hospital abstract systems Patients are grouped into DRGs based on Principal diagnosis Co morbidity Complication Principal procedure Secondary procedure Age

2 Sex Discharge status Each DRG should contain patients with a similar pattern of resource intensity Each DRG group has a set payment rate that is based on historical charge and payment data Costs are reimbursed (80% of costs) Each DRG should contain patients who are similar from a clinical perspective DRG assignment is primarily based on diagnosis and/or procedure performed Fully packaged system Example: DRG 127 Heart Failure and Shock One DRG is assigned per encounter/admission Costs for all services are included in the payment for the one DRG Pharmaceutical Supplies Nursing Facility accepts profit or loss Drives facilities to practice cost management Patient health information (PHI) data needed to group DRGs One principal diagnosis (dx) and up to 8 additional dx One principal procedure (px) and up to 5 additional px Age Sex Discharge status

3 DRG Components Group number MDC Assignment Major diagnostic category 25 Medical/surgical status Medical/surgical/pre-MDC Title LOS GMLOS AMLOS Relative weight Measure of resource intensity for a particular type of encounter Code range that drives DRG assignment Steps in Assigning a DRG: Pre-MDC assignment Nine DRGs for which the MDC of the principal diagnosis is not taken into consideration for DRG assignment. The cases are directly assigned based upon procedure codes only Heart transplant 103 Liver transplant 480 Bone marrow transplant 481 Tracheostomy (face mouth neck) 482 Lung transplant 495 Simultaneous pancreas/kidney transplant 512 Pancreas transplant 513 Tracheostomy (except face mouth neck) with major procedure 541

4 Tracheostomy (except face mouth neck) without major procedure 542 MDC Determination What is the MDC of the principal diagnosis (dx) Principal diagnosis Definition: established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care The MDC of the principal diagnosis used for assignment Medical/Surgical status determination Was an operating room (OR) procedure performed? Yes: surgical status No: medical status Refinement Various questions are used to isolate the correct DRG assignment This process allows the DRG system to group together like patient from the clinical perspective with like resource consumption Is a complication or co morbidity (CC) present? Is the principal diagnosis complicated? Is a major complication or complex diagnosis present? Is the patient s age greater or less than 17 years of age? What is the patient s sex? What is the patient s discharge disposition (alive, expired, or against medical advice? What is the birth weight of the baby (for neonates)? Complication: A condition arising during the hospital stay that prolongs the LOS by at least one day in approximately 75% of the cases Co morbidity: A pre-existing condition which because of its presence with the principal diagnosis will increase the LOS by at least one day in 75% of the cases A major complication/co morbidity (MCC) is a category of CC that is of a higher severity.

5 MS-DRGs Basics: 1) Effective date 10/1/2007 2) 745 groups 3) Utilizes CC diagnoses and MCC diagnoses 4) Three tiered system Development: Three Steps Consolidation of existing DRGs into base DRGs Categorization of each diagnosis as a MCC, CC or non-cc Revision criteria: - Does this condition require intensive monitoring? - Does this condition result in the use of expensive and technically complex services? - Does this condition result in extensive care requiring a greater number of caregivers? Subdivision of each base DRG into subclasses based on CCs In order for a subgroup to be created all five criteria had to be met: 5) A reduction in variance of charges of at least 3 percent 6) At least 5 percent of the patient in the MS-DRG fall within the CC or MCC subgroup 7) At least 500 cases are in the CC or MCC subgroup 8) There is at least a 20 percent difference in average charges between subgroups 9) There is a $4,000 difference in average charge between subgroups