Healthcare Financial Recovery: A Guide to the COVID-19 Add-On Payment
With the COVID-19 pandemic ongoing, healthcare organizations continue to face catastrophic financial challenges. Drivers of the economic strain include the increased cost to care for patients with COVID-19, impact of canceled services, and additional costs—such as personal protective equipment (PPE) and the supplementary support some hospitals provide to their employees.
During the pandemic era, getting paid appropriately for services is more important for health systems than ever. Recognizing these challenges to healthcare financial recovery, the federal government provides programs to give organizations financial relief, including add-on payment for patients diagnosed with COVID-19. To qualify for assistance, health systems must understand these relief programs and comply with their requirements.
Healthcare Financial Recovery: The 20 Percent Add-On Payment for COVID-19 Patients
On March 27, 2020, The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law to assist hospitals with additional payment for treatment of patients with a diagnosis of COVID-19. Under CARES Act guidance, the Medicare Hospital Inpatient Prospective Payment System add-on payment for COVID-19 patients during the emergency period states that a discharged individual with a COVID-19 diagnosis will receive a 20 percent increase in the weighting factor of the diagnosis related group (DRG) to which they (the discharged individual) are categorized.
Payment, however, isn’t automatic. Organizations need to know the rules and regulations around receiving COVID-19 financial relief.
How Health Systems Can Ensure the COVID-19 Add-On Payment
The following three requirements will help health systems ensure add-on payments for patients diagnosed with COVID-19:
Include a Copy of the Positive COVID-19 Laboratory Result in the Medical Record
Health systems must include a copy of the positive COVID-19 laboratory result in the patient’s medical record. This result can be from another facility prior to hospital admission but should typically be obtained within 14 days of admission.
If the result is from more than 14 days before admission, CMS will review the case to determine if any medical conditions led to the admission. The provider must also document these conditions. Clinical documentation integrity (CDI) specialists can assist with the documentation requirement by reviewing cases at the time of admission for patients claiming a positive test at another facility. If a provider can’t get the initial result, the CDI specialist can also obtain a copy of the lab result for the medical record or speak with the physician about repeating the COVID-19 test.
Create Internal Policies for COVID-19 Results from More than 14 Days Before Admission
Organizations should create internal policies for handling cases with lab results from more than 14 before admission. For example, for COVID-19 complications that can occur weeks or months after the initial COVID-19 positive result, such as deep vein thrombosis or pulmonary emboli, organizations need to determine whether the code for an active COVID-19 is appropriate. In some cases, it may be correct to instead assign a code for a personal history of COVID-19 (Z86.19).
A good indicator of when to use an active COVID-19 code is whether the organization followed its isolation protocol. If the health system did not expend additional resources to care for the patient in isolation, it shouldn’t use the active COVID-19 and doesn’t qualify for additional payment. In this instance, a personal history of COVID-19 code is likely more appropriate.
Document and Appropriately Code the COVID-19 Diagnosis
Providers must document and appropriately code COVID-19 diagnoses following the ICD-10-CM Official Guidelines for Coding and Reporting. The positive lab result alone is not enough to code the COVID-19 diagnosis. The provider also needs to document the diagnosis as a “confirmed” diagnosis, as the organization can’t code COVID-19 if the provider documents the diagnosis as a “probable” or “possible.”
As of April 1, 2020, the correct diagnosis code for COVID-19 was U07.1. CMS indicates that the COVID-19 diagnosis code can appear in any diagnosis field on the claim (principal or secondary). Health systems may benefit from having CDI specialists review all inpatients on the COVID-19 unit or all cases with positive lab results to ensure the diagnosis documentation and coding after discharge is appropriate.
Some data platforms (e.g., the Health Catalyst Data Operating System (DOS™)) allow facilities to send these specific cases to a queue after discharge. This way, health systems can validate that the COVID-19 diagnosis is coded before submitting the claim.
Health systems can use a specialized tool, such as the VitalWare® by Health Catalyst VitalAuditor™, to assist with auditing. Such tools filter accounts on several different measures (e.g., by discharge date range or accounts with a COVID-19 diagnosis). Users can easily divide the accounts into batches and assign them to multiple auditors. The auditor can see how changes to the original coding affects DRG weight and reimbursement. The auditing tool can also run reports to show auditor changes, DRG shifts, and financial impact by DRG.
Ongoing Auditing for Appropriate Payment Supports Healthcare Financial Recovery
Even with a solid front-end process for meeting the COVID-19 add-on payment requirements, organizations should continue tracking claims until they receive payment. Ongoing auditing will help health systems identify denials and appeal within the designated time frame, as well as identify process improvement opportunities and implement necessary changes quickly.
Organizations will benefit from staying up to date with the rules and regulations around coding and billing for COVID-19, as compliance with these changes may affect reimbursement. A coding and regulatory information tool, such as VitalWare by Health Catalyst VitalKnowledge™, can assist organizations by alerting them in real-time to the latest changes to coding and billing rules and regulations, ensuring ongoing auditing practices for appropriate payment and long-term financial recovery.