Hospital Acquired Conditions and Present on Admission Resource for Acute Care Hospital Facilities

The hospital is the entity required to bill POA indicators on all inpatient claims billed to Medicare. However, accurate coding of all diagnosis codes and POA indicators necessitates reliance on accurate documentation by physicians. Thus, it is important that hospital staff and physicians work together. This resource provides some basic information about POA and HACs, documentation communication suggestions and resources for additional information.

Please note similar information for physicians is located on the Part B website.

Background

As required by the DRA of 2005, the HAC-POA Indicator Reporting provision requires a quality adjustment in Medicare Severity-Diagnosis Related Group (MS-DRG) payments for certain HACs. Facilities reimbursed under the IPPS must submit a POA indicator for the principal and all secondary diagnoses on all inpatient claims.

The POA indicator identifies whether the patient’s condition is present at the time the order for inpatient admission to a general acute care hospital occurs. Conditions that develop during an outpatient encounter, including emergency department, observation, or outpatient surgery, are identified as POA.

Note that the HAC-POA payment provision under the DRA is distinct from the HAC Reduction Program described in Section 3008 of the Affordable Care Act of 2010, which authorizes the CMS to make payment adjustments to applicable hospitals based on risk-adjustment quality measures.

Hospital Acquired Condition

As required by Section 5001(c) of the DRA, the Secretary of the United States Department of Health & Human Services is required to identify at least two conditions that are:

High cost or high volume or both;
Result in the assignment of a case to an MS-DRG that has a higher payment when present as a secondary diagnosis;
Could reasonably have been prevented through the application of evidence-based guidelines.

Definition of HAC:

If at discharge, there is a selected condition that was either not identified by the hospital as present on admission, or could not be identified based on data and clinical judgment at admission, it is considered hospital-acquired.

Payment Implications:

IPPS hospitals do not receive the higher payment for cases when one of the selected conditions is acquired during hospitalization (that is, the condition was not present on admission). The case is paid as though the secondary diagnosis is not present.

HAC Categories:

The CMS IPPS includes fourteen categories of HACs that are applicable for fiscal years 2014 through the present. Documentation should be specific as to whether any documented conditions falling into one or more of these categories was present when the Medicare patient came to the facility (present on admission) or was acquired during the inpatient stay (hospital acquired condition).

The current list of HAC categories include:

Foreign Object Retained After Surgery
Air Embolism
Blood Incompatibility
Stage III and IV Pressure Ulcers
Falls and Trauma
- Fractures
- Dislocations
- Intracranial Injuries
- Crushing Injuries
- Burn
- Other Injuries
Manifestations of Poor Glycemic Control
- Diabetic Ketoacidosis
- Nonketotic Hyperosmolar Coma
- Hypoglycemic Coma
- Secondary Diabetes with Ketoacidosis
- Secondary Diabetes with Hyperosmolarity
Catheter-Associated Urinary Tract Infection (UTI)
Vascular Catheter-Associated Infection
Surgical Site Infection, Mediastinitis, Following Coronary Artery Bypass Graft (CABG):
Surgical Site Infection Following Bariatric Surgery for Obesity
- Laparoscopic Gastric Bypass
- Gastroenterostomy
- Laparoscopic Gastric Restrictive Surgery
Surgical Site Infection Following Certain Orthopedic Procedures
- Spine
- Neck
- Shoulder
- Elbow
Surgical Site Infection Following Cardiac Implantable Electronic Device (CIED)
Deep Vein Thrombosis (DVT)/Pulmonary Embolism (PE) Following Certain Orthopedic Procedures:
- Total Knee Replacement
- Hip Replacement
Iatrogenic Pneumothorax with Venous Catheterization

HAC Diagnosis Codes:

The specific ICD-10 (International Classification of Diseases, Tenth revision) diagnosis codes associated with the HAC categories are available at ICD-10 HAC List.

Note: A “provider” is a physician or any qualified health care practitioner who is legally accountable for establishing the patient’s diagnosis. For additional information on POA Reporting Guidelines, refer to CMS Hospital-Acquired Conditions Reporting web page.

Present on Admission:

CMS requires acute care hospitals to report POA information for both primary and secondary diagnosis codes on all inpatient claims. Hospitals will not receive the higher payment for cases in which one of the selected conditions is acquired during the hospitalization (the condition was not POA). Thus, the case would be paid as though the secondary diagnosis was not present.

POA Definition:

POA is defined as any condition that was present at the time the order for inpatient admission occurred. Thus, any condition that develops during an outpatient encounter is considered POA; including those conditions that developed during an emergency department visit, observation, and/or outpatient surgery.

Applicable Facilities:

POA reporting is only required for admissions to hospitals paid under the IPPS.

Exempt from POA reporting: Any non-IPPS facility including: Critical Access Hospitals, Children’s Inpatient Hospitals, Inpatient Rehabilitation Facilities, Inpatient Psychiatric Facilities, Long Term Care Facilities, Cancer Hospitals, Maryland Waiver Hospitals, Religious Non-Medical Health Care Institutions, and Veterans Affairs/Department of Defense Hospitals.

CMS POA Indicator Options and Definitions

Refer to the chart available within the MLN® Fact Sheet Hospital-Acquired Conditions and Present on Admission Indicator Reporting Provision.

List of Diagnosis Codes on the POA Exempt List:

The POA indicator is not reported for codes on the POA exempt list.

The list of ICD-10-CM codes on the POA exempt list is provided on the Hospital-Acquired Conditions- Coding web page in a downloadable format by Fiscal Year.
To group diagnoses into the proper MS-DRG, CMS needs to identify a Present on Admission (POA) Indicator for all diagnoses reported on claims involving inpatient admissions to general acute care hospitals. Use the UB-04 Data Specifications Manual to facilitate the assignment of the POA indicator for each "principal" diagnosis and "other" diagnoses codes reported on the claim.

Documentation

The importance of accurate, consistent, and complete documentation in the medical record cannot be overemphasized and is the basis for correct billing and reimbursement. Specific to POA and HACs, hospitals must review the complete medical record to determine accurate coding and bill accordingly so that the claim is properly reimbursed. Medical record documentation from any provider involved in the care and treatment of the patient may be used to determine whether a condition was POA developed after admission (HAC). In the context of the ICD-10-CM Official Guidelines, a “provider” is a physician or any qualified health care practitioner who is legally accountable for establishing the patient’s diagnosis. For additional information on POA Reporting Guidelines, refer to CMS’ Hospital-Acquired Conditions Reporting web page.

Documentation Tips:

POA Diagnoses: Physicians should document all conditions that develop during an outpatient encounter (including emergency department, observation, or outpatient surgery) prior to an inpatient admission - whether or not they are the primary or secondary diagnosis.
Diagnoses acquired during the inpatient hospital stay (HAC): Physicians should document all conditions that developed during an inpatient stay - whether or not they are the primary or secondary diagnosis.
Hospitals should work with physicians to resolve any unclear, conflicting, or missing documentation prior to claim submission.
Hospital staff should work with their physicians and coders to determine the best method to communicate POA and HAC information at their facility.
A consistent approach for all staff will improve accuracy and decrease the need for additional communication to clarify the medical record prior to billing.

Examples of Methods to Communicate POA/HAC Diagnoses:

Providers, their billing offices, third-party billing agents, and others involved in the transmission of data must ensure that any sequencing/resequencing of ICD-9-CM (or ICD-10) diagnosis codes prior to their transmission to CMS also includes a sequencing/resequencing of POA indicators. Thus, communication with all parties is vital.

Hospitals should set a standard method of communicating with physicians including the preferred method of communicating diagnosis, POA and HAC coding information.

The hospital might decide that the discharging physician should clearly indicate in the discharge summary which of the conditions were or were not present on admission as well as those acquired during the inpatient stay.
The hospital may prefer the physician add “POA” and “HAC” next to all applicable diagnoses within their notes.
Hospitals using electronic medical records may prefer to add an option to note whether each diagnosis is POA or HAC.