DRG Assignment & Case Mix Flashcards
6 cards from real CCS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 DRG Assignment & Case Mix flashcards as text
In the IPPS payment formula, what does the 'wage index' adjustment account for?
Answer: Geographic differences in hospital labor costs between markets
The wage index adjusts the labor-related portion of the DRG base payment rate to reflect geographic differences in hospital labor costs - hospitals in high-wage areas receive a higher wage-adjusted payment.
A hospital is reviewed by a Recovery Audit Contractor (RAC). What type of claims does the RAC primarily target?
Answer: Improper Medicare fee-for-service payments including coding errors, billing errors, and non-covered services
RACs (Recovery Audit Contractors) identify and recover improper Medicare fee-for-service payments, including overpayments from upcoding, duplicate billing, and non-covered services, as well as underpayments.
What is 'DRG creep' in the context of inpatient billing compliance?
Answer: The systematic pattern of coding to higher-weighted DRGs without clinical documentation support
DRG creep refers to systematic upcoding - assigning codes that produce higher-paying DRGs than the clinical documentation supports - which is fraudulent and a major target of Medicare audits.
Under IPPS, what is a 'cost outlier' payment?
Answer: An additional payment made when a case's costs significantly exceed the DRG threshold plus a fixed loss amount
When an inpatient case's costs are extraordinarily high - exceeding the DRG payment plus a fixed loss threshold - Medicare pays an outlier payment of 80% of the costs above the threshold.
A coder is reviewing a claim for a patient admitted with alcohol-induced acute pancreatitis with documented dehydration. Which coding approach maximizes compliant reimbursement?
Answer: Code K85.20 for the pancreatitis and E86.0 (Dehydration) as a secondary diagnosis, which may qualify as a CC
The correct approach codes the principal diagnosis (acute pancreatitis K85.20) with dehydration (E86.0) as a secondary diagnosis. Dehydration qualifies as a CC for many DRGs, accurately capturing patient complexity and improving DRG assignment.
What is the significance of the 'two-midnight rule' introduced by CMS for IPPS payment?
Answer: An inpatient admission is generally appropriate for Medicare payment when a physician expects the patient to require hospital care spanning at least two midnights
The Two-Midnight Rule states that inpatient admission is generally appropriate for Medicare Part A payment when the physician reasonably expects the patient to require care crossing at least two midnights; shorter stays typically should be observation status.