Journal excerpt: Payment and criteria for inpatient psychiatric facilities

When the inpatient prospective payment system (IPPS) became law in the 1980s, freestanding psychiatric hospitals were exempt. Like some cancer centers today, psychiatric facilities were not paid based on DRGs—that is, until the Balanced Budget Refinement Act of 1999. This new act specified that, beginning in 2005, psychiatric hospitals would be paid under the Inpatient Psychiatric Facility Prospective Payment System (IPF PPS).

Since then, Medicare has required psychiatric facilities to provide:

• Proof that the active treatment can reasonably be expected to improve the patient’s condition
• Documentation for services necessary for diagnostic treatment
• Proof that the patient’s inpatient stay meets the need for active inpatient treatment by IPF personnel at the time of admission, 12 days after admission, and no less than every 30 days that the patient continues receiving treatment

Even after meeting those criteria, Medicare still only covers patients for 190 days of care in freestanding psychiatric hospitals.

Psychiatric facilities follow the Diagnostic and Statistical Manual of Mental Disorders, fifth edition (DSM-5) for diagnostic criteria for mental disorders and use ICD-10-CM for code assignment. The disconnect between these clinical and coding definitions makes CDI specialists’ role more difficult when it comes to physician engagement.

For example, the DSM-5 replaced the term “dementia” with either major or minor neurocognitive disorder. ICD-10, however, still includes a code for dementia. This means that providers working in the psychiatric setting may be documenting clearly according to the DSM-5, but their documentation may not seamlessly translate to ICD-10 codes.

“Our CDI program really started with ICD-10,” says Linda Jackson, RHIT, director of HIM at Arkansas State Hospital, the only freestanding, state-run psychiatric facility in Arkansas, based in Little Rock. At the time, however, “DSM-5 had only recently taken effect and [physicians] were already overwhelmed.”

When the DSM-5 published in 2013, the diagnostic codes in the manual corresponded to the ICD codes. However, each year since, the four Cooperating Parties updated ICD-10, so the correspondences slipped over time. Such discrepancies equal big educational opportunities for both clinical and coding staff.

“The physicians [received] some education, but a lot of it has gone to the coders,” says Suzanne Dennis, CTRS, CCDS, director of clinical services/documentation specialist at Acadia Healthcare Company, Inc., a Franklin, Tennessee–based a company that owns private psychiatric hospitals in the United States and Puerto Rico. That way, when coders encounter something in the documentation like “major neurocognitive disorder,” they know what ICD-10 code it corresponds to. (For a guide on translating DSM-5 terminology to codes updated in the 2018 release of ICD-10-CM, visit the American Psychiatric Association website.)

Editor’s note: This article is an excerpt from the May/June 2018 CDI Journal. Jackson was a speaker at the 2018 ACDIS Conference on the topic of CDI in psychiatric facilities. To review her slides, ACDIS members can visit the Resource Library. The materials should be posted in the next couple weeks.