FY 2020 IPPS proposed rule increases hospital payment rates, releases ICD-10-CM/PCS codes

CMS’ fiscal year (FY) 2020 Inpatient Prospective Payment System (IPPS) proposed rule, released April 23, includes a proposed increase to hospital payment rates, annual ICD-10-CM/PCS code update proposals, and significant changes to complication or comorbidity (CC)/major complication or comorbidity (MCC) and Medicare-Severity Diagnosis-Related Group (MS-DRG) designations.

CMS proposed an approximate increase of 3.2 percent in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting Program and are meaningful electronic health record users.

“This reflects the projected hospital market basket update of 3.2 percent reduced by a 0.5 percentage point productivity adjustment,” CMS said. CMS notes that the proposed positive 0.5 percentage point adjustment is required by legislation.

According to the proposed rule, CMS projects that the rate increase, together with other proposed changes to IPPS payment policies, will increase operating payments by approximately 3.5 percent.

“Proposed changes in uncompensated care payments, new technology add-on payments, low-volume hospital payments, and capital payments will increase payments by an additional 0.2 percent. Therefore, CMS estimates a total increase in IPPS payments of approximately 3.7 percent,” the rule said.

Overall, CMS projects total Medicare spending on inpatient hospital services, including capital, will increase by about $4.7 billion in FY 2020, the rule said.

The rule also includes 324 proposed ICD-10-CM code changes for fiscal year 2020—273 new, 30 revised, and 21 invalidated codes. A majority of the newly proposed ICD-10-CM codes are used to report pressure-induced deep tissue damage, acute versus chronic embolism and thrombosis, and fractures of the facial bones around the eye, among other changes.

For example, these include proposed ICD-10-CM codes such as:

• L89.026, pressure-induced deep tissue damage of the left elbow
• I82.463, acute embolism and thrombosis of the calf muscle vein, bilateral
• S02.122A, fracture of the orbital roof, left side, initial encounter closed fracture

CMS’ proposed ICD-10-PCS codes include a significant amount of new Bypass codes, as well newly proposed codes for various Replacement, Insertion, and Transfusion procedures. The rule also proposed to invalidate many ICD-10-PCS codes, most of which were for Dilation procedures.

Along with the ICD-10-CM/PCS code change proposals, CMS proposed hundreds of CC/MCC designation changes. For example, the following are just a few of the ICD-10-CM codes (currently designated as CCs) that CMS is proposing be downgraded to non-CCs:

• C82.91, follicular lymphoma, unspecified, lymph nodes of head, face, and neck
• C83.02, small cell B-cell lymphoma, intrathoracic lymph nodes
• C83.37, diffuse large B-cell lymphoma, spleen

CMS also proposed that various ICD-10-CM codes currently designated as MCCs be downgraded to CCs. However, not all of CMS’ CC/MCC designation proposals are downgrades. For example, CMS is proposing that ICD-10-CM code O03.36 (cardiac arrest following incomplete spontaneous abortion) be moved from a CC to an MCC.

In the IPPS proposed rule, CMS proposed that many changes be made to MS-DRG designations as well. Of note, CMS proposed that various ICD-10-PCS codes describing Dilation procedures of the carotid artery with an intraluminal device be removed from MS-DRGs 037, 038, and 039 (Extracranial Procedures).

The entire list of proposed changes to the ICD-10-CM/PCS codes and CC/MCC designations are available in tables 6A-6K and tables 6P.1c-6P.1e of the rule. CMS invites the public to comment on all proposals. For more information on the rule, see the Federal Register. Comments are due to CMS by June 24, and the final rule is expected to be released in August.