Health Information Management

Q&A: Determine medical necessity for inpatient admissions for COPD

CDI Strategies, July 5, 2012

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Q: Our hospital serves a higher than usual population with COPD. Most of these cases are chronic and the patient is typically on home oxygen. Blood gases are almost never obtained on admission unless the patient is placed on a ventilator. Is acceptable to query the physician for chronic respiratory failure, 518.83 a comorbid condition/complication (CC) based on documentation of the presence of home oxygen use by these patients? Or do we also need a pulse oxygen reading of 88% or lower while they are here in the hospital?

A: From the information you provided it seems like this type of patient is a two-fold risk. First, chronic COPD patients (who are not experiencing acute respiratory failure) rarely meet inpatient criteria so you may want to work with your utilization review and case management department as well as your emergency department providers to find out if all COPD patients are admitted as inpatients or if any of them are placed in observation. 
If  COPD patients are always admitted, your hospital has a potential medical necessity setting problem. If some receive outpatient observation and some are inpatients it would be beneficial for you need to find out how the physicians differentiate those who needs inpatient care from those who need observation care as the decisions is probably based on the amount of respiratory comprise being experienced by the patient at the time of admission.
Typically, those who meet inpatient criteria are experiencing acute-on-chronic respiratory failure due to COPD exacerbation. The emergency room physician documentation should support acute-on-chronic respiratory failure as these patients should significantly differ from their baseline respiratory function. Evidence of this respiratory compromise may include tachypnea, tachycardia, anxiety, inability to speak full sentences, use of aerosol treatments, administration of steroids, etc. The priority and focus of treatment would be decreasing the work of breathing and ensuring continued oxygenation of the brain and body. Additionally, treatment of the acute on chronic respiratory failure would include treatment of the exacerbation of the COPD.
CMS does not require blood gases or a pulse oxygen level to support the coding of diagnoses it is sufficient for the provider to make the diagnosis; however, CMS auditors do expect corroborating support of acuity requiring inpatient care for medical necessity. If the patient is ill enough to meet inpatient criteria then there should be documentation of their baseline pulse oxygen and the requirement of respiratory support beyond their normal home oxygen regimen. Some organizations are assigning CDI staff to the ED to assist providers with demonstrating the acuity level of their patients though the documentation of applicable diagnoses, which also supports the acuity of an inpatient admission.
To specifically answer your question, yes, there is sufficient evidence of a missing diagnosis to query for chronic respiratory failure in COPD patients with home oxygen who continue oxygen therapy in the inpatient setting. Such a query would be no different than a patient taking medication for a chronic condition at home and continuing that medication in the hospital, like Lasix for congestive heart failure, for example. You do not need a pulse oxygen or blood gases to justify the query as long as the provider has documented the diagnosis of COPD and regular use of home oxygen therapy because the diagnosis of chronic respiratory failure often accompanies the diagnosis of COPD in order for the chronic COPD patient to quality for Medicare coverage of home oxygen. 
As I previously mentioned, the provider can make a diagnosis based on patient presentation and their clinical judgment.  It is the CDIS and/or coder who must determine if that diagnosis meets the definition of an “other” or secondary diagnosis according to coding guidelines so it can be coded, however; the requirements for medical necessity (setting/level of care) require objective clinical indicators like room air pulse ox and ABGs so it is best for the documentation to include these values because these patients are at high risk for medical necessity errors. 
Editor’s Note: This question was answered by Cheryl Ericson, MS, RN,CCDS, CDIP, CDI Education Director for HCPro Inc., in Danvers, Mass. To learn more about CDI Boot Camps taught by Ericson, or to register, visit


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