MS-DRG shifts under ICD-10

Posted on 06.01.2016

One of the unexpected outcomes of the transition from ICD-9 to ICD-10 is the number of shifts in DRG. A DRG shift results when the same case, coded in ICD-10, falls under a DRG that is different than the resulting DRG when the case was coded in ICD-9. DRG shifts result in increased reimbursement for some conditions and/or procedures and some shifts result in decreased reimbursement.

Most shifts in DRG are related to the gain or loss of a diagnosis as a complicating condition or major complicating condition. Medicare’s analysis of DRG shift showed that 0.41% records had a DRG shift to a higher paying DRG (+ $13 per $10,000) and 0.66% of records had a shift to a lower paying DRG (- $17 per $10,000). Overall, only 1.07% of records had a shift in DRG, with a net loss of $4 per $10,000. Statistically speaking the results are a zero and not statistically significant.

So, you may ask “Why do we care if DRGs have shifted?” The answer lies in case mix index or CMI. Although the net loss or gain from DRG shifts is minimal, when viewed on the average, many organizations have a prevalence of certain types of patients. If a large portion of the patients they service fall into a DRG that has shifted under ICD-10 their CMI index is going to change in comparison to what it looked like under ICD-9. Changes in CMI signal possible changes in overall reimbursement for the organization so these numbers are closely watched by financial administrators. The possible financial impacts to an organization make DRG shifts a key indicator that health information management professionals should have on their radar for review when evaluating the impact of the ICD-10 implementation on their facility.

CareerStep offers in depth education focused on understanding DRGs and the impact ICD-10 has had on them.