Corporate Compliance

Tip: Beware of common postacute transfer pitfalls

Compliance Monitor, July 11, 2007

Facilities often lose the full DRG payment to which they are entitled as a result of events that are out of their control and of which they are never aware. Consider the following common pitfalls surrounding postacute transfers and discharge disposition code assignments:

  • The patient is discharged to an acute-care hospital (discharge status code 02). Sometimes when a hospital transfers a patient to another acute hospital, the patient receives outpatient care instead of being admitted. This is considered a discharge (discharge status code 01) and the hospital should receive the full DRG payment.
  • The patient is discharged to a skilled nursing facility (discharge status code 03). The patient may arrive at the skilled nursing facility but not certify for a Medicare Part A bed, so that facility places him or her in a custodial bed (discharge status code 04). Again, in this case, the hospital should receive the full DRG payment.
  • The patient is discharged to a home health agency (discharge status code 06). If the hospital refers the patient to a home health agency, but unbeknownst to the hospital the patient refuses care, then the hospital is still entitled to the full DRG payment.

"CMS would not receive a bill for the expected subsequent care, but they don't edit for that," says William E. Haik, MD, FCCP, director of DRG Review, Inc., in Fort Walton Beach, FL. "Someone needs to be an advocate for the hospital to research the claims to see if they were erroneously paid for these transfers."

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