An analysis by health economist Joseph Newhouse, who serves on the Congressional Budget Office Board of Health Advisors and co-chairs the 2010 Technical Review Panel on the Medicare Trustee Report, suggests that the methodology CMS uses to calculate the documentation and coding adjustment for its inpatient prospective payment system does not separate coding effects from true case mix change, according to an AHA News Now report.
CMS introduced the adjustment to offset the effect of coding changes in the classification of patients. CMS claims the coding changes have caused hospitals to receive increased reimbursement. However, the AHA and others have argued that the increased reimbursements could be due to truly sicker patients being treated by hospitals. This may be due, in part, to healthier patients being treated as outpatients.
Mr. Newhouse's analysis concludes that CMS' methodology in adjusting for documentation and coding effects cannot separate effects from true case mix change (i.e., a possibly more acute case mix) because it uses claims data to determine the adjustment.
"The best one can do with claims data alone is to calculate the upper and lower bounds of the combined effect of documentation and coding and true case mix change," according to the report.
As a result of the findings, the American Hospital Association, Federation of American Hospitals and Association of American Medical Colleges sent a letter with CMS Administrator Donald Berwick, MD, sharing the findings.
Read the AHA News Now report on the coding and documentation adjustment.
Read more coverage on the IPPS:
- MedPAC Calls for 1% Raises for Hospitals, Physicians
-
CMS introduced the adjustment to offset the effect of coding changes in the classification of patients. CMS claims the coding changes have caused hospitals to receive increased reimbursement. However, the AHA and others have argued that the increased reimbursements could be due to truly sicker patients being treated by hospitals. This may be due, in part, to healthier patients being treated as outpatients.
Mr. Newhouse's analysis concludes that CMS' methodology in adjusting for documentation and coding effects cannot separate effects from true case mix change (i.e., a possibly more acute case mix) because it uses claims data to determine the adjustment.
"The best one can do with claims data alone is to calculate the upper and lower bounds of the combined effect of documentation and coding and true case mix change," according to the report.
As a result of the findings, the American Hospital Association, Federation of American Hospitals and Association of American Medical Colleges sent a letter with CMS Administrator Donald Berwick, MD, sharing the findings.
Read the AHA News Now report on the coding and documentation adjustment.
Read more coverage on the IPPS:
- MedPAC Calls for 1% Raises for Hospitals, Physicians
-