Caught in the Act: A DRG Downgrade without Record Review

Once in a while, you just have to laugh. And my most recent laugh came at the expense of an unidentified Medicare Advantage (MA) plan.

A patient was admitted to a hospital as an inpatient from Oct. 26 to Nov. 1, 2024. The condition category in the Part C appeal database was labeled as “Urinary tract infection site not specified.” The patient was diagnosed with sepsis as the principal diagnosis, and the claim was submitted.

But the MA plan issued a Diagnosis-Related Group (DRG) downgrade, invalidating the principal diagnosis of sepsis (which should come as no surprise) and downgrading it to a urinary tract infection with a major complication or comorbidity (MCC). This change would cut the DRG weight from about 1.9 down to 1.1, an obviously significant difference. The hospital disagreed and appealed to the CMS Qualified Independent Contractor (QIC) on behalf of the patient.

As with all appeals to the QIC, the QIC notifies the plan that an appeal has been filed, and the plan is responsible for sending the medical records to the QIC. When the QIC did not get records to review this appeal, they asked the plan to send the records, and the plan responded that “they did not receive medical records for this inpatient stay and did not request any.”

And as you would expect, the QIC responded (as they should) by stating, “We find that the plan has not substantiated their denial in this case. Their denial is about the fact that the medical records do not support the diagnoses billed for this inpatient stay.”

Now, come on, MA Plan; if you are going to claim that the records don’t support the billed diagnoses, at least request the records, even if you don’t actually read them.

Now, just to show I am not biased, there was another case where I disagreed with the QIC. This was a patient with a 14-day inpatient stay for an infection with MRSA. The hospital billed with a principal diagnosis of sepsis due to MRSA. The MA plan changed it to a simple infection, arguing there was “no physician documentation of life-threatening organ dysfunction caused by a dysregulated response to infection.”

The QIC’s response was to support the diagnosis of sepsis, noting that “the enrollee had a known source of infection from MRSA with multiple SIRS (Systemic Inflammatory Response Syndrome) criteria, thus meeting the criteria for sepsis.” Now, with a 14-day stay, one has to presume this patient was pretty sick, and perhaps there was organ dysfunction that was not properly documented, but in my opinion, the QIC is just plain wrong; SIRS plus infection alone is just not sepsis, as I discussed last week.

And finally, you may hear from some Medicare beneficiaries that they received a new Medicare card without asking for one. As you all know, Medicare went away from using Social Security numbers as the Medicare ID numbers to reduce fraudulent use of that number, but apparently some bad actors figured out the Medicare algorithm for generating these Medicare ID numbers and used them to submit a bunch of fraudulent claims.

So now, the Centers for Medicare & Medicaid Services (CMS) has to deactivate those account numbers that were actually assigned to beneficiaries, but used for improper claim submission, and issue new cards to those patients with their new numbers.

CMS also stressed the importance of patients carefully reading the Explanation of Benefits (EOBs) they get in the mail, and contacting CMS if there are charges for care they did not receive. Granted, those EOBs are not easy to read, but if there is a charge for medical care that did not occur, the patient should notice it and should call Medicare. It is incumbent on all of us to stop these cheaters.