2022 IPPS Proposed Rule Includes New Codes, Proposed MS-DRG Changes & Bi-Annual Code Update Possibility

2022 IPPS Proposed Rule Includes New Codes, Proposed MS-DRG Changes & Bi-Annual Code Update Possibility

CMS released the Proposed Rule for FY 2022 IPPS on April 27, 2021. CMS published the Proposed Rule in the Federal Register on May 10, 2021 (Federal Register, 2021). Comments on the Proposed Rule are due by June 28, 2021. CMS will release the Final Rule later this summer. In addition, all approved changes will be effective on October 1, 2021. The rule, along with all separately posted tables for codes, MS-DRGs and the like, is available on the CMS website here.

As always, the Proposed Rule has a great deal of payment and financial information. CMS estimates that provisions outlined in the proposals would increase hospital payments by approximately 2.8%; this would bring the total to $2.5 billion. More details are available via the CMS fact sheet (CMS, 2021).

In addition, we included a comprehensive review of provisions in the 2022 IPPS Final Rule in the 2022 IPPS & MS-DRG 10-1-21 Updates course by YES HIM Education. This course will review and discuss the 2022 IPPS and MS-DRG updates and changes effective 10/1/21. Furthermore, the course will review applicable guidelines and identify new and/or revised information. The course will also analyze additions and deletions to the MCC and CC lists, as well as changes to add-on payments.

Other Provisions of the 2022 IPPS Proposed Rule

Highlights of other provisions include adjustments to compensate for the effect of the COVID-19 Public Health Emergency (PHE). The PHE has significantly impacted revenue, case mix, and inpatient utilization.

For example:

  • CMS has proposed using the FY 2019 Medicare Provider Analysis and Review (MedPAR) data for rate-setting, rather than the FY 2020 data.
  • Since CMS will use FY 2019 data the agency proposes a one-year extension of New Technology Add-on Payments (NTAP) that would otherwise expire. This affects 14 NTAP items, including Hemospray® and Spine Jack® system. You code most procedures and services for NTAP in the New Technology section of ICD-10-PCS.
  • The COVID-19 Treatments Add-on Payment (NCTAP was instituted last year) and set to expire when the PHE was declared complete. CMS has now proposed to extend the payment for eligible stays through the end of FY 2022.

Another change is the repeal of the planned comprehensive overhaul of the MS-DRG rate-setting that CMS announced in the 2021 Final Rule. This provision was intended to move from a cost-to-charge ratio to a market-based MS-DRG rate setting policy by FY2024. CMS has proposed this to be set aside.

Repeal of this change will also eliminate the requirement that hospitals provide the median payer-specific negotiated payment rate by MS-DRG for all of its Medicare Advantage (MA) organization payers. If CMS finalizes the repeal, analysts estimate that this will reduce hospital work time by 63,780 annual hours.

Updates to MS-DRGs

2022 IPPS proposed rule

A significant portion of the proposed rule discusses potential changes to MS-DRGs, and these are described by MDC. Also included is the annual review of procedures classified to MS-DRGs 981-983, Extensive OR Procedures Unrelated to Principal Diagnosis, and 987-989, Non-Extensive OR Procedures Unrelated to Principal Diagnosis. This review looks at the volume of cases in these MS-DRGs. Using this, CMS will determine if reassignment into a surgical MS-DRG into which the principal diagnosis falls is more appropriate, or if the procedures should be shifted from Extensive OR Procedures to Non-Extensive OR Procedures.

Also listed are potential redesignations of OR Procedures to Non-OR Procedures, as well as Non-OR Procedures to OR Procedures. For example, CMS proposed that they list four codes for reposition of sacroiliac or hip joints with internal fixation device using a percutaneous approach as OR procedures instead of Non-OR. See the proposed rule for a detailed description of all proposed changes.

Changes to the Non CC, CC and MCC lists

As always, the rule includes the 2022 new proposed coding guidelines to the MCC and CC lists. All of these are noted in the tables 6I.1, 6I.2 and 6J.1.

Another proposal is to change the severity level designation of all unspecified ICD-10-CM codes to Non CC. This would occur when there are other specific codes available in the same subcategory. You can find the full list of applicable codes in table 6p.2a. This includes 3,490 codes that CMS now designates as either a CC or an MCC.

For example, H33.20, Serous retinal detachment, unspecified eye is now a CC, but, in FY 2022, would be a Non CC, while the remaining codes in this subcategory that specified, right, left or bilateral eye would remain CCs.

Of the 3,490 codes that CMS proposed to have a Non CC designation, 507 are currently MCC, and 2,983 are CC designations. Since many of the unspecified codes relate to laterality, some chapters in ICD-10-CM have a high number of changes. Twelve chapters would have no changes, while the musculoskeletal and connective tissue codes in the M00-M99 series would have the highest percentage of change at 29.2%.

New ICD-10-CM and ICD-10-PCS Codes

2022 IPPS updates

CMS will review and evaluate all comments received with the final determination on all proposals outlined in the final rule. Items that are not commented on are the proposed new diagnosis and procedure codes. CMS establishes these codes after consideration at the Coordination and Maintenance Committee. The National Center for Health Statistics establishes the diagnosis codes, while CMS establishes the procedure codes.

In addition, you can find the new diagnosis codes, along with their CC/MCC, MDC and MS-DRG status, in table 6A. Note that CMS included the six codes related to COVID-19 implemented on January 1, 2021 in the table. Furthermore, the procedure codes, along with their MDC and OR/Non OR status, are listed in table 6B. The 21 new procedure codes related to COVID-19 effective January 1, 2021 are also listed in table 6B.

These proposed codes are not subject to comment. However, there may be additions to the list based on the proposals brought forth at the March 2021 Coordination and Maintenance Committee Meeting. For example, CMS is considering code U09.9, Post COVID-19 condition, for implementation on October 1, 2021. See the Final Rule for a complete list of codes effective October 1, 2021.

Potential April 1 Code Implementation Date Proposed

As discussed at the March 2021 Coordination and Maintenance Committee Meeting, CMS is proposing a regular April 1 implementation of both diagnoses and procedure codes. This is in addition to the October 1 date. This is in addition to the existing April 1 potential code updates due to new technology and medical services.

This new date would allow for more timely recognition of diseases and procedures in claims data. The new date also enables more up-to-date data collection. If this proposal is finalized, all April 1 update files would be available by February 1; this is to allow for system updates.

New ICD-10-CM Codes in the 2022 IPPS Proposed Rule

CMS has included 153 new ICD-10-CM codes listed in table 6A, including the six COVID-19-related codes implemented on January 1, 2021. Highlights (excluding COVID-19 approved codes) include:

  • Chapter 1: One new code for anaplasmosis
  • Chapter 2: Two codes to capture bilateral ovary malignancies; and one code for anaplastic large cell lymphoma, ALK-negative, breast
  • Chapter 3: Two codes to capture pyruvate kinase deficiency; two codes to capture other thrombocytosis (including secondary and reactive); and one code for hereditary alpha tryptasemia
  • Chapter 4: One code for Niemann-Pick disease type A/B
  • Chapter 5: One code for depression, unspecified; two codes to capture genetic related intellectual disability including SYNGAP1
  • Chapter 6: One code for acute flaccid myelitis; one for cervicogenic headache; six codes to classify immune effector cell-associated neurotoxicity syndrome including grades; and two codes to distinguish other and unspecified toxic encephalopathy
  • Chapter 9: One code for non-ischemic myocardial injury (non-traumatic)
  • Chapter 11: Three codes to classify esophageal and esophagogastric junction polyps; ten codes to capture gastric intestinal metaplasia
  • Chapter 12: Eight codes for moisture associated skin damage
  • Chapter 13: Three codes to allow reporting hematopoietic stem cell transplant-associated thrombotic microangiopathy; seven codes for Sjogren syndrome; ten codes for non-radiographic axial spondyloarthritis in spine; and three codes to allow vertebrogenic low back pain
  • Chapter 16: One code for newborn affected by positive group B Streptococcus; and eight codes to capture abnormal neonatal screening
  • Chapter 18: Six codes to provide specificity to cough; two codes to differentiate between nocturnal polyuria; one code for nonsuicidal self-harm; four codes for specificity of pediatric feeding disorders; and one code for abnormal findings of blood amino-acid levels
  • Chapter 19: Six new codes to differentiate traumatic brain compression with and without herniation; 36 new codes to classify poisoning, adverse effect, underdosing of cannabis and synthetic cannabinoids; and three codes for complication of immune effector cellular therapy
  • Chapter 20: Three codes for legal interventions to include involving other specified means for an unspecified person injured
  • Chapter 21: One code for immunization counseling; one code for allergy to mammalian meats; two codes to differentiate between history of suicidal behavior and non-suicidal self-harm; and four codes for personal history of chimeric antigen receptor T-Cell Therapy (CAR-T) and other gene therapy

The 2022 ICD-10-CM Updates course is live on the YES HIM Education site – enroll here. This course will outline the new and revised 2022 ICD-10-CM codes and guidelines.

New ICD-10-PCS Codes in the 2022 IPPS Proposed Rule

2022 inpatient prospective payment system

In addition, there are 127 new ICD-10-PCS codes listed in table 6B, including the 21 COVID-19-related codes implemented on January 1, 2021. The majority of the changes are in the Medical and Surgical section. These include:

  • Nine new codes in the 02V table for Restriction, adding the left ventricle body part for treatment of functional mitral regurgitation
  • Two codes are in the 031 table by adding the body part value for brachial artery for Bypass of the Upper arteries to allow for coding of percutaneous AV fistula formation with a vein of the lower arm
  • Four new codes by adding a body part value for bone marrow in the 07D Extraction table to identify procedures to extract bone marrow from other sites such as the femur
  • 12 codes in the 06L table by adding approach values 7 and 8 to the body part value of other vein to report Occlusion via endoscopic banding, for procedures such as endoscopic banding of the hemorrhoidal plexus
  • Nine codes in the 0F8 table for liver body parts to allow for Division of the liver for partitioning as the first step in a staged liver removal
  • Two codes in table 0K8 by adding approach values 7 and 8 for the body part value for tongue, palate, pharynx muscle for procedures such as stapling of Zenker’s diverticulum
  • Three codes in the Insertion table for Head and Facial Bones with device value for Infusion device into the skull body part to allow for procedures such as the implantation of an Ommaya reservoir for administration of chemotherapy intracranially
  • Two codes added to the 0PS and two codes added to the 0QS tables for Reposition of the Upper and Lower Bones respectively, adding the device value of 3 for Spinal Stabilization Device, Vertebral Body Tether, using an open or percutaneous endoscopic approach for treatment of scoliosis
  • Six new codes in the 0QB table Excision of Lower Bones, adding qualifier value 2 Sesamoid Bone(s) 1st Toe, for the body part values N Metatarsal, Right and P Metatarsal, Left, to identify procedures such as the excision of the fibular or tibial sesamoid bone
  • 12 new codes in the 0RP table for Removal of Upper Joints and 16 new codes in the 0RW table for Revision of Upper Joints by adding qualifier values 6 and 7 for humeral and glenoid surface for the right and left shoulder joint body parts. This will allow for coding the removal of revision of components of partial shoulder arthroplasty procedures

Furthermore, there are new codes in other sections of ICD-10-PCS:

  • New code 5A1221J in the Extracorporeal or Systemic Assistance and Performance section for use of devices for mechanical chest compressions
  • Four new codes in the Imaging section table BF. This adds the body part of liver to capture high, low and other contrast. This also adds qualifier A to one code to indicate fluoroscopic guidance in liver procedures
  • 43 New Technology Codes, the majority of which represent administration of substances. In addition, the 21 codes related to COVID-19 that CMS implemented on January 1, 2021 are included in this number

The 2022 ICD-10-PCS Updates course is live on the YES HIM Education site – enroll here. This course will outline the new and revised codes and guidelines for the Medical and Surgical, Medical and Surgical-Related, and Ancillary sections.

Significant changes in the 2022 IPPS proposed rule for October 1, 2021 relate to payment, MS-DRGs, as well as new diagnosis and procedure codes. Review an overview of the 2022 ICD-10-CM 10-1-21 Updates here, and the 2022 ICD-10-PCS 10-1-21 Updates here. Review the finalized changes here.

A comprehensive review of provisions in the 2022 IPPS Final Rule is included in the 2022 IPPS & MS-DRG 10-1-21 Updates course by YES HIM Education. This course will review and discuss the 2022 IPPS and MS-DRG updates and changes effective 10/1/21. It will review applicable guidelines and identify new and/or revised information. The course will also analyze additions and deletions to the MCC and CC lists. Changes to add-on payments will also be discussed.

Ann Zeisset, RHIT, CCS, CCS-P, co-authored this article with Teri Jorwic, MPH, RHIA, CCS, CCS-P, FAHIMA.

Teri Jorwic

Contract Educator, MPH, RHIA, CCS, CCS-P, FAHIMA
2022 IPPS proposed rule

Subscribe to our Newsletter


  • By clicking Submit, you agree to YES HIM Consulting's Privacy Policy and Terms of Use.