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Three Key Takeaways from the FY 2021 Inpatient Prospective Payment System Proposed Rule

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Typically, we would have the Final Rule updates to the Inpatient Prospective Payment System (IPPS) for the 2021 fiscal year (FY) 60 days prior to its effective date. However, this year, citing the COVID-19 public health emergency (PHE), publication was delayed. The final rule was published on September 1, or 30 days before the effective date.

With these delays, it’s more important than ever to understand what’s in the final rule, to get an idea of what’s to come and the changes your team needs to make in order to ensure your organization is prepared and compliant.

To help you in this effort, the Panacea team has combed through the final rule and identified several key takeaways.

Key Takeaway No. 1: Changes are coming in CC/MCCs

Though specific changes have not yet been announced in this area, the final rule includes a lengthy conversation on complications and comorbidities (CCs) and major CCs (MCCs), and the criteria the Centers for Medicare & Medicaid Services (CMS) is using to evaluate them. This explanation of reasoning is likely a forerunner to coming changes – whether they appear in this year’s final rule or in the future. Though the comment period is now closed, the request for public comment in this area is another indicator that CMS is looking at it closely to make sure it is being approached in the best way possible.

Key Takeaway No. 2: COVID is a big area of change and learning

The COVID-19 PHE has been challenging at every level, nowhere more so than within healthcare coding, billing, and revenue cycle operations. It’s absolutely critical that your team understand how to appropriately code and document around COVID. Guidance and updates on this were released in early August, and more are expected with the final rule. In many cases, COVID coding differs from standard guidelines, so it’s particularly important to make sure your team is up to speed. CMS has also already announced that the new COVID-19 guidelines will be released on October 1, 2020.

Key Takeaway No. 3: DRG groupings will change

Though diagnosis-related groupings (DRGs) often don’t directly affect coders, they are incredibly important to the reporting and tracking within any healthcare organization – and changes and adjustments are made every year. This year will be no different, and it’s critical to understand what these changes will mean for your organization. In this year’s final rule, CMS also requested comments on the market-based MS-DRG relative weight methodology that would go into effect in FY 2024, indicating that these updates and changes will be under close consideration for some time.

How to Prepare Now

With the tight timeline between the final rule’s publication and the effective date, it’s essential to ensure that your team understands the coming changes as soon as possible to give your organization the time to implement. Your approach affects your patients, your organization, and the community as a whole.

  • Though your coders never touch or even meet your patients, by coding their information – what condition they have, how they were treated, and more – they are creating records that can follow patients for years, impacting their physical, emotional, and financial well-being.
  • This is also data that has a sizable impact on your organization. Without correct coding and documentation, it’s all too easy to be over- or under-billing, opening you up to revenue loss and compliance risk.
  • And finally, now more than ever, this coded data affects the daily lives of the general public, as governments make decisions based on this information when they decide how to deal with the coronavirus pandemic.

To help your staff become familiar with the changes that will have the biggest impact on your organization’s coding, the Panacea team is presenting an in-depth webinar on the final rule, and what you can do to ensure compliance.

Watch an on-demand presentation to make sure you and your team will have the information needed to be prepared for the coding and regulatory updates coming for FY 2021.

IPPS FY2021 Final Rule: Key Updates: Click here to Register