October 2, 2023
What’s changing: Effective Jan. 1, 2024, Blue Cross and Blue Shield of Illinois (BCBSIL) will align with the Centers for Medicare and Medicaid Services’ transfer rules when paying inpatient claims that use the Medicare Severity Diagnostic Related Group (DRG) claims methodology.
This means that if a member’s hospital stay is shorter than the average length of stay because the member is transferred to another facility, the DRG claim will be prorated for the length of the stay.
These transfer rules apply to all inpatient DRG claims for acute care transfers to another acute care setting for commercial members. It also applies to claims (when the transfer is made to a post-acute setting) with eligible DRG codes – see the list in Table 5 of the applicable fiscal year Medicare hospital inpatient prospective payment systems (IPPS) Federal Register for the list of qualifying post-acute services.
If a member’s hospital stay is shorter than the average length of stay and the member is transferred to another facility or home, the DRG claim submitted by the transferring hospital will be prorated to match the length of the stay. These transfer rules apply to:
All inpatient DRG claims for acute care transfers from the hospital to another acute care setting (when the transfer is made to a post-acute setting) with eligible DRG codes
These transfer rules apply when a member is moved from an acute care hospital including:
- Transfers to another acute care hospital or unit for related care, Patient Discharge Status Code (PDSC 02 or 82)
- Transfers from acute care hospital to a post-acute setting
- Transfer to an inpatient rehabilitation facility or unit (PDSC 62 or 90)
- Transfer to long term acute care facility (PDSC 63 or 91)
- Transfer to a psychiatric care facility (PDSC 65 or 93)
- Transfer to a children’s hospital, cancer hospital (PDSC 05 or 85)
- Transfer to a skilled nursing facility (PDSC 03 or 83)
- Transfer to Hospice care (PDSC 50 or 51)
- Transfer to Critical Access (PDSC 66 or 94)
- Transfer to home under a written plan of care for the provision of home health services from a home health agency (PDSC 06 or 86) except when Condition Code 42 or 43 is on the transferring hospital’s claim
Why change: This helps the member avoid paying double for services. For example, if an average length of stay is seven days, but the member is discharged from acute care and admitted to a skilled nursing facility on day five, without these adjustments, the member would pay twice for days five, six and seven – once at the acute care facility and once at the skilled nursing facility.
More information: See 42 Code of Federal Regulations 412.4(a) and (b) and the Medicare Claims Processing Manual Pub. 100-04, Chapter 3, Section 40.2.4.
Also review in detail our new Clinical Payment and Coding Policy – Transfer Diagnostic Related Group (tDRG), CPCPILtDRG.