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It has been a busy two weeks. Ten days ago, the Centers for Medicare & Medicaid Services (CMS) released the proposed 2018 Inpatient Prospective Payment System (IPPS) rule, which, as usual, came out late on a Friday afternoon.

The good news about the Rule is that the agency did not propose any changes to the substance of the two-midnight rule. With all the recent attention given to observation, I was really concerned that CMS was going to make a change. You’ll recall that in the 2016 IPPS Rule, CMS added the exception for physician judgment that a patient required inpatient care despite an expectation of fewer than two midnights of hospital care being necessary. 

This time I was expecting a new exception for patient judgment when the patient or family insists that they be admitted as inpatient. Luckily, CMS did not listen to Kate Snow from NBC News, AARP, or the Center for Medicare Advocacy, and it did not propose such a modification.

But one of the changes that was proposed has raised a few eyebrows. Each year, CMS reviews DRG weighting, and for this, year one of the substantive changes, they have proposed to move all ankle replacement surgeries from DRG 470 (DRG weight 2.0671, total joint replacement without a major complication or comorbidity) (an MCC) to DRG 469 (weight 3.2906), which for now is called total joint replacement with MCC (major complication or comorbidity).

In other words, even if the patient has no MCC, their surgery will be paid via a DRG weighted for an MCC. Why is this? Well, CMS claims that the costs of even the most basic ankle replacement exceed the payment associated with DRG 470. And who would have guessed that the new Secretary of Health and Human Services, Dr. Tom Price, just happens to be an orthopedic surgeon who was criticized by many when his financial advisor purchased stock in the manufacturer of the ankle implants just prior to his Senate confirmation hearings.

There is one other noteworthy DRG change. If a patient presents with a stroke, gets thrombolytic treatment, and the deficit resolves and the physician documents the final diagnosis as transient ischemic attack (TIA), that admission will no longer fall into the low-weighted DRG 069 (DRG weight 0.7373) but will move to the DRG triad for stroke with thrombolytic agent (DRG weights 1.567 to 2.7367). That’s good for hospitals, as these patients were actually having a stroke, and excellent care prevented it.

Second, last week was the first in over a year that the U.S. Supreme Court had a full contingent of nine justices, with Neil Gorsuch taking his seat. And on the first day of arguments, the court heard a case concerning federal employee grievance rights.

During oral arguments, Justice Alito commented about the federal rules and said “nobody who is not a lawyer and no ordinary lawyer could read these statutes and figure out what they are supposed to do.” He went on to say the statute’s drafter must have been “somebody who takes pleasure out of pulling the wings off flies.” One lawyer called it a fool’s errand for a layperson to try to interpret federal regulations.  

As I read this, all I could think about is the struggles we all have interpreting CMS regulations. Who would have guessed that the Supreme Court feels the same way about federal regulations?

And of course, I wonder if we went into the lunch room in the CMS office where new regulations are drafted, if we would see flies having to walk from table to table.


Ronald Hirsch, MD, FACP, CHCQM, CHRI

Ronald Hirsch, MD, is vice president of the Regulations and Education Group at R1 Physician Advisory Services. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices and is a published author on the topic. He is a member of the Advisory Board of the American College of Physician Advisors, a member of the American Case Management Association, and a Fellow of the American College of Physicians. Dr. Hirsch is a member of the RACmonitor editorial board and is regular panelist on Monitor Mondays. The opinions expressed are those of the author and do not necessarily reflect the views, policies, or opinions of R1 RCM, Inc. or R1 Physician Advisory Services (R1 PAS).

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