News: Maximized coding may be driving increased inpatient hospital spending, Massachusetts study suggests

The Massachusetts Health Policy Commission (HPC) monitors healthcare spending and provides recommendations for policy reform. At its most recent meeting on September 11, HPC researchers presented trends in commercial inpatient hospital volume and spending in the state. It found that commercial inpatient spending grew 10.7% between 2013 and 2018, while inpatient volume decreased by 12.8%, according to Revenue Cycle Advisor.

The researchers determined that this significant increase in spending was driven by both increased prices for hospital stays and increased acuity of inpatient stays. Researchers presented the following findings to support this claim:

• From 2013 to 2018, all major hospital systems in Massachusetts reported increasing patient acuity
• Statewide commercial risk scores rose 3% per year from 2013 to 2017
• The average price for inpatient hospital stays rose 5.2% between 2013 and 2017

The data, however, do not support the notion that Massachusetts residents are becoming sicker. According to the report, DRG weights grew more than 10% between 2013 and 2018, while other indicators of clinical severity (e.g., length of stay [LOS], days spent in the intensive care unit [ICU]) did not increase, Revenue Cycle Advisor reported.

For example, the average number of days commercially insured chronic obstructive pulmonary disorder (COPD) patients stayed in the ICU decreased 7% between 2013 and 2017. However, the average LOS remained the same despite a 20% increase in DRG weight.

Overall, the data indicates that hospitals are maximizing coding (meaning, potentially, that CDI professionals are clarifying the record allowing coders to capture the highest-weighted codes appropriate for that care) rather than seeing sicker patients, said David Auerbach, director for research and cost trends at HPC, at the meeting.

The HPC’s preliminary findings, scheduled for publication next year, could have significant implications for healthcare spending and care delivery.

Editor’s note: This story originally appeared in Revenue Cycle Advisor. To read the preliminary study findings, click here.