Appeal type: Inpatient Hospital
Decision: Unfavorable

 
We decided that the Plan does not have to pay for inpatient hospital care provided from November 9, 2021, to 
November 12, 2021, as billed with Diagnosis Related Group (DRG) 189. 
 
You asked the Plan to pay for inpatient care as billed with DRG 189. You say that these services were 
medically necessary and are supported in the record. The Plan denied your request. The Plan says DRG 189 is not appropriate as the diagnosis of acute/chronic respiratory failure with hypoxia (J96.21) is not supported in 
the medical record. The Plan argues that DRG 191 is more appropriate in this case, with chronic obstructive 
pulmonary disease (COPD) with acute exacerbation (J44.1) sequenced as the principal diagnosis. 
 
The Plan must follow Medicare rules. Medicare rules say that providers must report services correctly. 
Providers must report inpatient hospital services with the appropriate DRG, which is based, in part, on the 
reported principal and secondary diagnosis codes. 
 
We asked our physician reviewer to carefully review the case file and apply the relevant Medicare rules to 
determine if the Plan was correct in denying the request to pay for inpatient care as billed with DRG 189. Our 
reviewer says that the diagnosis of acute/chronic respiratory failure with hypoxia (J96.21) is not supported in 
the record for this inpatient admission. Our physician reviewer found that even though acute and chronic 
hypoxic respiratory failure is documented in the history and physical, the consult notes, progress notes and 
discharge summary, the documentation is inconsistent and incomplete in the support of this diagnosis. The 
enrollee was transferred from another hospital to this facility on November 9, 2021, and was found to have 
COPD exacerbation per the record. Documentation of the frequency of the enrollees home oxygen use was 
unclear in the record. Per a discharge planning note, the enrollee wears oxygen at night, was to wean to home 
dose two liters as tolerated, and the enrollee reported having oxygen as necessary at home. Documentation of 
respiratory distress, tachypnea, labored breathing, increased work of breathing, inability to speak a complete 
sentence/conversational dyspnea, retractions, stridor, orthopnea, rales, rhonchi, crackles, or wheezing were not 
noted in the record. Baseline respiratory status/physical exam/symptoms, arterial blood gas values on room air/ 
the enrollees home oxygen, and oxygen concentration levels on room air and home oxygen were not noted in 
the record. After treatment in the emergency department, respiratory rates greater than 30 while at rest, 
accessory muscle use while at rest, or altered mental status related to hypoxia while at rest were not noted in 
the record. Per the history and physical, the enrollees mental status was noted as "at Baseline, alert, awake and 
oriented to time, place and person. Arterial blood gas values for this admission were not found in the record. 
After treatment in the emergency department, persistent (2 or more sequential consistent readings) oxygen 
concentration levels less than or equal to 90 percent while at rest were not noted in the record. The review has 
determined that the medical records do not support the billing of acute/chronic respiratory failure with hypoxia 
(J96.21). 
 
We looked at this physician's review, the file, and Medicare rules. Based on this information, we decided that 
Medicare rules for coverage of inpatient care as billed with DRG 189 have not been met. Therefore, we 
decided that the Plan does not have to pay for inpatient hospital care provided from November 9, 2021, to 
November 12, 2021, as billed with Diagnosis Related Group (DRG) 189.