NATIONAL DRG VALIDATION STUDY: 
FY  1985 
PEER REVIEW ORGANIZATION CODING ACCURACY 
RICH 
P. KUSSOW 
INSPECTOR GENERA 
AU 
12-9  199
 EXECUTIV SUMMARY

PURPOSE 
cog 
Th  organtion (PRO) 
inpecton analyzs the accuracy of peer review 
diagnosis related groups (DRGs). 
BACKGROUND 
The"F 1985 National DRG Valdation Study rcced 7,050 dicharges strtied by 
The Ofce of Inpeor Genera (OIG) locted PRO rcabstrctons for 
hospita siz.  Th subsple accteJy represented the underlyg 
23.9 percent of the saple. 
confounders. 
population by age, sex diagnosis related groups, and other probable 
FIDINGS 
sigcatl 
The PROs cocc coed 78.1 percnt of reabstractons,F ai s  lower 
Intermedes. 
the 
proporton than the 81.8 percent accteJy pad by 
. A PRO that changed a DRG had a 90.5 percent chace of being wrong. 
upced their erroneous DRG reabstrctons, COD.poundig 
. On average, the PROs  cog acccy. 
the fiancial effect of their lower  These errors causd at least 
Yea 
mion in  1985. 
$172.9  overpayments for Fisca 
RECOMENA110NS 
should determe whether the 
Admitrtion (HCFA) 
The Health Care Financig 
errors ba deceaed 
proporton of PRO rcabstrcton 
th 
determe  PRO alo fids  ditributon of 
The HCF A should  whether the Super 
chges to PRO coing. 
controls of the PROs increae 
The HCFA should determne whether internal qualty 
acccy 
the  of their DRG reabstrctons. 
draf of th inpeon, the HCF A stated that it has 
In the AprD 24 comments on a 
accacy of PRO coing. We agree that 
actons to improve the 
taen a number of 
is now 
thes actions respond to the intent of these remmendations. The OIG 
collecg FY 1988 PRO cog data. Comparon of these independentl genecraotegd  
achiev by the HCFA in improvg PRO 
data sets wil meaure the progres 
accacy.  .............................. ......................................................................................... .............. ................................ ..................................................................... . ............................ ............................. ...................................................................
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TABLE OF OONTENTS 
EXCU SUMY

TAB  OF CO 
INODUcnON 
BACKGROUN. .

MEODOLOGY

FIINGS 
PRO  ACCCY 
PRO CODING 
EFCT 
DRG 
A110NS 
RECO 
Apix  PRO reew by hopita demography 
demogrphy. . . . . . . 
Appedi  PRO revew by patient 
acc 
cog 
Apdi PRO  by hospita demography 
Ap 
cog  demogrphy. . 
F1  accracy by hospita 
acacy 
PRO coing  by patient demogrphics 
Ap 
AplX  Statitica methocology  INTRODUCTION

BACKGROUND

Orgations 
Stadads Revew  (PSROs) 
established the Professiona 
In 1972 Congress  ensurg that al servces 
It charged the PSROs with 
as part of the Socal Securty Act. 
medca neCss, conformed to 
Medicad were 
deliered under Medicae and 
deliered effcientJ and ecnomicay.
appropriate professional stadards and were  strcte 
restrcted revew
1982 however, Congressl icton celusdaetdi tgha t the PSRO  agait por 
heath cae cots and protec 
inovtion necessa to 
1, Subtitle C 
quality of cae. Therefore, under the Peer Revew Improvement Act Title 
1982, Public Law 97-24 Congress 
of the Tax Equity and Fisca Responsibilty Act of 
Orgations 
crted the Utition and Qualty Control Peer Revew  (PHRuOsm).  Ths 
the PSeoR/eta of Othe U.s. D.ep arent of Health and 
legislation required the 
Servces (DllS) to contract with either "physician-sponsored" or "physician-accss 
PROs. Each 2-year contract s "scpe of work" defied the actties to be performed by
based 
Under the fit scope of work (19841986), the PRpOso re cived perforpmraoncsep-ee 
objeces to counter potential negatie incenties  by the new  litig 
servces 
PPS, hospita could reduce cots by 
payment sytem (PPS). Under the 
 raing the number of adJsions- or

payments by 
and shortenig stays and increas 
To control these trends, the PROs had 
upcing the diagnosis related groups (DRGs). 
thee admsion related goal: 
ecessa admions.

. Redce the number of 
and procural inormation

. Veri that payment coes conformed to the diagnostic 
in patient recrds.  ocg 
trfer  redmion  with 7 days of a prevous 
or 
Revew caes of 
dihage. 
cug 
quaty 
method for  utition or 
The fi scpe of work gave the PROs four 
, denial of payment, and recmmendation 
deficiencies: Education, intensifed revew
" in a 
Ofce of Inspeor General (OIG) sacton for "substatial violations
a DHHS  " or " flgrt violation in a single ca.  Each 
substatial number of caes gros and 
cotr al 
quaty of cae objectes. 
included fie 
unecss 
readmions. 
Reduce 
Umit prevntable complications.

. Reuce unnecssry surgery.
 . Loer the rik of mortalty.

. Lit avoidable postoperati  complications. 
exactg 
att  for  data 
these goal and objeces, the PROs recived guideli 
. To  In the fit scpe of work, these

about the physician and provders in their area 
included:

radom saple of admisions 
Five percent 
Pacemaker cases 
hospita to other hospita except swg bed

Trafers from PPS 
with 7 days of dichage

Readmisions 
. DRG reabstracton of DRG 46 and DRG 462 bils

Statitical outliers

hospita recive a pr-etablihcd payment for each dicharge, based 
Under the PPS,  dihages into 
ucplnc tahe  DRG to which the dichasrgiea grr oaumpos.u Tnthse o Pf PhoSs cpliatas irfeesdo urce baed on 
coherent groups tht use 
diis;  , sex, 
vables such as  evuation and treatment parosctuereds;  aDd patient age
which 
the 473 DRGs had an  relatie weight, 
and diharge statu. Each of 
cot for hospita cae provded to patients with dignoses 
represented the average 
cot of al patients. The hospita recived
gruping to that DRG as a propoarctotnl  olfe nthgeth  of hospitation or cot of treatment for 
th payment independent of the  coumg less 
retaed any surlus from patients 
tthhe  indivdual patient. The hospita  consumg 
the exed amount of resurces, and absorbe a los for patients 
more. 
acccy 
the  of DRG payments 
Optiona, the PROs reabstrcted PPS bil to check 
procur 
dignosc and  inormation from 
to hospitals. The PRO revewers compard 
nartie  proures attesed to the attendig 
the medca recrd to the  nadtiigneo ses and  ICD9- (International 
phyic and the conversion of  inormation to  (R) 
Die)  admitrtor  or an 
Cascation of  coes. A regitered recrds 
acedte  genera  the rcbstrcton. 
recrds tehncian (ART)  superv 
Disge
16.547.674
claed 
Dmg their fit scope of work, the PRbOils .  PRO  576.
have reabstrcted .33.7 pcrcent of PPS  Among  (Pernt)  (33.
8 pcrcent to  Co.. 
radomJ seleced disharges,c thoeny tforutn dW 4. I  So' PP MonAg c.  Repor1
m error. error rate  9.2 on pp MPoRocr  f . Feb. '2.1887 
ielS&Rthfi
Tab 
8 pcrcent 
 1. 
percent reported by the SupcrPRO and thVe 2a0H. datioD 
repoed by the "F 198 National DRG 
8C 
Study Fin Report.  (%) 
of the  Rev caegor  DRG error 
Sources both inide and outside 
Ra 
DHHS studied PRO performance under  sae 
work. In the second  975,280  47,  (4.
the fit scpe of 
Intensie  319,  18,721  (5. 
scpe of work (19861988), the Health  160,  18,  (11. 
DRG 
Cae Financig Admitration (HCFA)  Otr  121,505  141,  (3.

adopted many of their fidings to

strengthen PRO revew. These changes  Tot  vain57r6,e    22f, i  (4.

included exanding revew from  Tab 2:  fo th  PR 

DR 
redmion with 7 days of a prior  at 
with 
diharge to readmision  15 days 
ence of prematue 
sapled dihages for evd
of a prevous discharge. The PROs also 
reewed  unexlaied statitical 
dihage or trnsfer. In addituiotni,t tihoeyn   hospitaPsR wOitsh  recived a stadad set of 
outlers in mortlity rates and  pattern. The 
alo revewed short. stays 
quaty sceens to apply in aU caes seleced for review. They 
progr. Al 
implemented communty outreach 
in the hospital and developed and 
rerds seleced for reyew were subjeced to DRG vadation, and the PRO bad to 
its sta. 
one credentialed medica recrds profesional on 
have at leat 
analis of PRO 
the HCFA drew on exensive 
In devloping the thrd scopse copfe w oorf kw,
ork. It alo incorprated changes mandated in 
actties under the second 
 send scpe of work: 
since the implementation of the 
the followg public laws passe 
Recnciation Act of 1985 
Public Law 99-272, the ConsolidatedO Ommbnuibsu Bs uBdugdegte Rt ecnciation Act of 198 (OBRA 
(COBRA); Public Law 99-509, the 
86); and OBRA 87. 
conant  send, but added seera 
The thd scpc of work remaed  with the  contrctors 
signcat  more consistent acros 
amendments. To make PRO actties 
pla 
intervntion  under which the PROs follow a 
the HCF A develope a baic quaty  notig 
stdadi  categorig  provders and 
procss for  quty prblems 
exded 
intitutig interventions. Al, revew of hospita readmions  to patients 
redmtted with 31 days. Oter new requiements include: 
reew in at leat 20 pcrcent of rura 
Perform a signcat number of on-site 
hopitals. 
iniv 
necity of  procures. 
Revew the reonableness and medca 
procdures. 
Conduct a revew of ambulatory surgery 
thos physicians provders, and DRGs found to 
Conduct intensifed revew of 
cae. 
exbit a 
pattern of substandard  ..  ., 
hospital intervenig cae for which Medicae payment could be made, 
. Revew post-
the send admion 
that is deliered between two hospita readnions where 
of discharge from the fit admision. 
withi 31 days 
thee ways. To  Pernt 
The HCFA evluated PRO performance in  Cycl 
HCFA requied month and  II
meaure PRO actties, the 
sumarg 
admiion revew, DRG

quarerJy report  other requied revew 1 12/849/8 9.

vadations, pre-admission revew, and  2 6/852/86 9. 
data. To evuate PROs more broadJy, the (HpCRFAO crMeatPed 2t)he.  3 11/857/86 11. 
PRO Monitorig Protocl Trackig SfStem 

The PROMP-2 surveyed PRO performce biantuahlle in  
6 6/87-388 9.

such area  gement, internal 
as community outreach,  Table 3: SuperPRO 
medica revew data Final, 
contrls sactons, and 
HCFA contrcted with Systemetrcs InC., al know as thce  a 
40  4 PRO
of approxateJy 
SupcrPRO, for a bianual review  from each ofp ther oc 
the PRO revew  using both 
of the caes, SuperPRO repeted 
area. For each  s ow crdterri  It cfomi paed it reults to 
the generic quality sceens and each PRO' fidigs 
and  report of its 
thos of the PRO. The SuperPRO then submitted 
s fidigs in an effort to 
to the HCF A. The PROs and HCFA follow-up the Super PRO'
improve PRO performance. 
exes  proc: 
DRG vadation. The 
Th inpeon  one aspe of the PRO revew 
cog 
vadation proc to ensure hospita  acccy. The 
HCFA relies on the PRO 
coe thir diharges accateJy for the PPS to reimbur them faJy and 
hospita must  hospita forwd each bil'  ICD9- dignosis 
for cot containent. Under PPS, the 
dicc  Fis Intermed (P). .The PI groups the 
and procure coes  to a stte 
ICD9- coes to determe the correc DRG, reimburs the hospita and sends ths 
radom saple of these 
inormtion to the HCFA. The PROs then revew a 
spc  cog acccy. 
asignents (plus certin  DRGs) for 
MEOGY 
strtied two-stage saple design 
Tbhae N ationa DRG Valdation Study emplofyietd  a  us siple radom 
stage, the OIG 
on hospitals and discharges. In the  thee be siz stta: 
saplig without replacemenbt teo s elec 80 hbosepi ta from each of 
Hosta  100299  and 30+ be. Tbe design excluded 
with les than 100 
spty intitutions (e.g., peiatrc, rehabiltation, and pschiatrc hospJitae)r,s f,a cities in 
tie (i.e., New York, New 
States not using prospecive payment at the 
c:cuation of 
Machustts and Maryland), and hospita not contn"butig data to the 
the inti relatie weights asigned to diagnosis-related groups. One saple hospital 
At  0f 
IUs.  Sq  of  HtIf.  JJ  PRO 
Gt  Se  A4m NtI
12, 198; 53 (116): J523. 
hI Rq. 
 (%) 
termated its Medicae eligibilty between the study pcriod and actal collecton of 
leavig a fit-stage sap1e with 239 from a popu1ation of 4,913 acute 
medica records, 
cae hospita. 
, a sytemic 
In the send stage Be sie  c:100 1-2 30+ Totl 
radom sap1e 
se1ected up to 30 
Medicaet rpfaetirernetsd (i nctludoing   other HpoospDliataiolsn    27.593  18,600  774 4,913 
pcrsns  Sam  80 23 
who died) 
hospita and those 
ftrhome e ach of the 239 hospital for  Yea  Piso  p':io (00,00)  5 3.1 3.6 8. 
fit hal of Fisca  1985. 
If the hospita dicharged fewer  hforpil s (00) 18.2 59.5 144.7 22. 
th  SSa  am  2.38 7, 
30 patients durdgi cthha rges SamingS  a fr  2(1.22.756)  (24..03)8  (1.6) (3. 
avable 
then 
period al 
 Tab 4: 
were se1eced. The OIG -
076 medca recrds selected. With caefu1 
copy of each of the 7,
reueste a cospe11eteec e
  use of subpona the OIG ultiteJy obtaed 7,050 char 
follow-up and 
al Medcae

represented the popultion of 
(99.6 percent). The sap1e accateJy 
benecies dihaged durg Fis Yea 1985.

Legton, MA 
to reabstrct the 
The OIG contrcted with the Heath Data Intitute of 
blided basis. Accited Recrd  enmined each cha and 
DcRoGnsv ornt  ath e supportble diagnoss and procTuechrncie  s intot IeC D9-. coes. A 
Adtrtor  cog 
superved the  and contrctor physician 
Regitered Recrd  spc 
pred spty questions. If the rebstrcted DRG diered 
advce about 
evuate  A physician 
from the DRG paid, a physician  the char on a blided bais.  radoml 
dicut  entie saple 
pael decdeds
 ed,  categorrieticongs.  Five percent pof trhe   meaur the acccy 
underwnt a  blided  by a dierent ART tor  eed 
signcat
Th quty  no 
control 
pro 
the reabstrcton method010gy.

diepaes  (agrent 0.95, kappa 0.856, Z  2.12). 
in the rebstracton 
The OIG subsuentl asked the PROs  Percent 
bd rea  trcted the roar

rccg. 
The

and if so, the resu1ts of the 
PROs reported reabstrctg 1,728 of the  20 ..

9 pcrcent

050 sap1e disharges, 23.
Smaler

when weighted by disharges. 
signcady 
hospita had  higher rates of 
PRO rebstracton (Ch-squae 28.5, 2 df, 
c100  100-299  300.. 
00 1).  "F 198 
Pc: 0. AppropriateJy, the  Fin  Bed size

National DRG Validation Study 
tht smaller Fvn 1: 
PR  by
Report" prevousJy noted 
 bilg 
higher rates of  errors.

intutions have  FINDINGS 
PRO 
Haensl 56. 
char from rual (Mantel- , 1 
The PROs disproportonateJy reabstrcted  Haenszel '?.  , 1 df P  OOI). As 
df P  OOl) and nonteachig hospita (Mantel- hospita 
reported by the "F 1985 National DRG Valdation Study: Final bRieplogrt tI 
diproportonate rates of  errors when 
exhibiting these characteristics suffered  concentrted 
appropriateJy 
size. The PRO selecon of dichages 
controllg for bed  (Appendi 1).
on intitutions with a high yield of reabstracton errors. 
0--'" 
Patient demogrphic charcteritics for 
m Iot-
728 records reabstracted by PROs 
the 1, 322 
the 5,
did not signcatly dier ftom 
remaig  lengt of 
recrds in average 
sty, mortity 
rate, or sex distnDution. 
However, the former subsample 
the latter

averaged slightly older than 
5, 1727 df,
 re 
test 4. Fi 
group of patients (t- saple therefore 
025). The PRO  2: PR  by 
pa 
Medcae
broadJy represented the al 

cas. 
(Appendix 2). 
ACCUCY 
PRO CODING 
When weghted by dicharges, the PROs Percent 
atted 78.1 pcrcent accuraacyc inc tcheyir  100  t: FI

E PRO

coing 
reabstractons. Their 
signcatJy in larger hospita 
improved 
OO).

(Ch-
squae 11.2 2 df, P=O.
PRO

Controllg for hospital siz, 
acccy signcatl

rebstrcton 
Haensl 
deteriorated in rul (Mantel- fi 
. SeO size

14.7, 1 df P  OOl) and for-8profit, 
  1 df 
3: PR 
Haenszel 3.
hospita (Mantel-
The PROs increaed their effciency by 
P-=0.05), but not in nornutea chig intitutions.  lower 
hospita but then deceaed their effeceness -wth 
greater sureilance of 
cog accacy in rural hospita. (Appendix 3). 
accteJy than the PROs intended to overse them. 
coe more 

InterestigJy, hospitals 
"F  Valdation Study: Final Report" found that the 

The  1985 National DRG 
dicharges. Ths proporton

acctely  4 percent of bils, weigted by 
paid 81. coing accacy (Ch-squae 25.
signcantly exceded the PROs' 78.1 percent  8, 1 df, 
OOl). Among the 1,728 discharges reabstrcted by the PROs, the PI accately 
Th fidig 
applied acros al hC?pita sizs and 
pad 81.8 percent, a 1.05 rate ratio.  dichages rcabstracted 
(Appendi 4). The subsamples of 
demographic characteritics5. 
 ). dier signcatl in patient
correcJy and incorrectJy by the PROs did not 
demogrphics. (Appendix 
PRO  OUTCOtlE 
( DRGJ 
Agree  1282 True posi ti ves 
( eorect)
Ac:cura te

1. 3BB 
Disagree  t) 
106 False negatives 
(Incorrec
Agree  ti ves
299 Type 1 false pos1 
1 . 728 
( Incorrect) 
Inaccurate 
Disagree 
27 Type 2 false positives
340  ( Incorrect) 
Disagree 
14 True nega ti ves
( eorect)
Fi  co 
4: PRO 
If the PI made 
A PRO' s reabstcton of the PI's payment has fie poible outcomes. 
ca  digree (fale 
the accrate payment, the PRO  either agree (tre positie) or fae 
negatie). If the PI paid inacctely, the PRO ca agree (ty 1  positie) or 
diharge to 
latter digreement may cause the PRO to reabstract the 
digree. The 
to a dierent, incorrec DRG (ty 2 fae 
either the correc DRG (tre negatie) or 
potie). 
(Figue 4). 
accteJy  lne 
Of th saple s 1,388 bil  fiAsl Icnteerm iarv
 DRG Tot 
reimbur  PRO 
by the Fl the 
correc  Co 
agreed in 1,22 caes; a  129
seitty of 92.3 percent. Howr,  PRO ( Inec 1282 
DRG (  106 
the 34  pad by the Fl 
bil inaccrateJy 
the PRO correctJy disagreed and  Total  138  340  1728 
Spe 
scubast ituted the right DRG in onl 14

923%  -= 4.
1 % 
Sensitiv - co 
a 4.1 pcrcent speifcity.

T8b 5: PRO 
For ths subsample as a whole, PI 
reimburment alone would have ben correc in 80.3 pcrcent (1388/1,72) of 
0 pcrcent 
PRO revew deceaed tota correc payments to 75.
diharges. The 
07 rate ratio. Under Bayesian anaJyis, if the PRO maes no DRG 
(l,/1,728), a 1.
 changes, it has 81.1 percent (1,282/1,581) chance of being correct. However, if the 
PRO elect to change the DRG reimbured, it has a 9. chance of 
5 percent  (14/147)
bneing crorreect. Thse PR.Os  would therefore make a higher proporton of correct 
Th 
minimi7.e 
deciions by not checkig the FI's payment at al.  strategy  both review
costs and errors. When the PROs do make DRG changes, they are wrong 10 out of
FI 
Relative weiaht Percent increase 
Outcomes  Number  Correct  PRO  (decease)
True poitive  1282  1157  1157  1157 
False negative  106  1140  1140  0707  (4. 
Type 1 false poitive  299  0755  947  0755  14. 
fal  1.20 
Type 2  poitive 0757  0498  (2.5) 
Total 
True negative  2998  0247  0247  (26.
1728 1.
1118  0845  1042 
we 
Ree 
Tab 
6:  by PRO 
DRG EFFECT 
Not only do the PROs have worse coding accuracy than the FIs, they then compound 
the fiancial effect of their mitakes by upcoding. Overall, the relative weights selected 
, whether for correct or incorrect DRGs, exceed by an average of 1.9 
by the PROs
percent either the correct relative weights or the relative weights paid by the PI. Type 
overpayment. However, other 
1 fale positives pricipally cause the acceleration in 
outcomes alo selectively contnbute to it. 
Of the 106 bils that the FI accurately  Paid 
Relative weicht
reimbured and with which the PRO then 
DRG paid  No.  PRO 
incorrecty diagreed, 27.4 percent grouped

to only five DRGs. On average for these  Pneumonia 9  0914  783

high frequency DRGs, the PRO incorrectly 127  Heart failure4  0300  4150

Arythmia 4 9200  9314 
paid. 
assigned their bil to higher relative  Angina  7470  7305 
weights than the PI accurately  182  Esophagitis 7  6121  9646 
Although thi trend did not continue for
 SOutbhtoetarl  29 0.8842 0.
less frequent DRGs, selective  77 1. 9255
Total  1868 1.
in  1254
improvement in PRO coding accuracy of  106 1.1140 1.
ch0707 
false negatives could reverse the net over-
Acrae pame 
Table 7:  (f 
reimbursement due to PRO coding errors. 
th PRO  negates) 
8 percent of the 299 bils inaccurately paid by the FI and with which the 
Similarly, 29.
PRO incorrectly agreed group to seven DRGs. For each of these DRGs, the PRO also 
confrmed an average reimbursement higher than the correct DRG. Less frequent 
, these 
DRGs and the subsample as a whole demonstrated the same upcoding. Overall . '
Paid 
J=elative weicht
Coec 
Among 27  DRG  Number 
inaccrate bils  II 
that the PROs changed to  acnt  783

14 Ceebrovasla 
diferent, incorrect DRGs  0177

87 Respiraor failure 
857
. 481 pcrcent group to six obdruiivse  
DRGs For thesea DlRoGs  888 9Cphru onlPimcf noa eimluoriae .  18 1.0914 0.
03 0.9827 
the PRO selections  12 1.
954
11273 HEe2a AstgheiOtiSsis  11 0.907 0. 
overpay the hospitals to a 
false Otr 14 0.6121 0.
Subotal  8115 
gOrevaetrear le xtent than thte hFlse. . 
 1T82  otal 
ty 2  89 1.0704 089
poities dow coe  po2)10 1.0776 0:96
29 1.
FI' relatie weight by 2.  lne  pa  0755 0.947 
percnt. The small  false  wi wh th 
Dumber of tye 2  Tab 8(: t  fa  PR 
tre  ages
ploiittsi es and
 negatives upcing of FI inacccies. 
their net eff ct On PRO 
cog 
errors  elative wei 
The PROs' 
Coect 
cot Medicae a mimum  Number  PRO 
DRG 
of $172.9 mion in Fiscal  Cebroobv e  690 
14 Ch 
Yea 1985 and potentially  pu  708 
88 
lager sums in subsquent  diase 
yea Prosive Part A  1547
89 Pneumia 
739 
Metic 
29 
pbailyomnen itns  Ftoitsae dY $e2a7r 1985.  3O2 Uri ttrctr Inecio
 6121  697
4S6 Uunrebd porurte al  7016

Tot 
The PROs reabstracted  93 0.
13 0.
diharges,  157  859 
33.1 pcrcent of  14 1.
skewed towds high  %1 1.0498 11..298 
pa  0757 
lne 
reimbursment DRGs. 
The PROs therefore made  Tab 9:  fwai w h pth PR o
 )  to a .

DR 
9 pcrcent  (t 2 
their 1. dfer 
ovyments on at least

$9.1 bilon of coing revews.
 RECOMMENDATIONS

determe whether the proporto  of PRO reabstrcton errors 
. The HCFA should 
has decreaed.

th 
alo fids 
determe whether the SupcrPRO  ditribution of

The HCF A shou1d 
changes to PRO coding.

deteime wheter internal quaty controls of the PROs increase 
. Tbe HCFA should 
reabstrctons. 
the accuracy of their DRG 
dr 
of th inpeon, the HCFA stated that it has 
In the Apri 24 comments on a 
acccy of PRO coing. We agree that 
actions to improve the 
taen a number of 
of these recmmendations. The OIG is now 
these actons respond to tle intent 
collectg FY 1988 PRO COing data. Comparon of these independently genecraotegd  
wi  the HCFA in improvg PRO 
data sets  measure the progres achieved by 
accacy.  (%) 
rew  hopi 
PRO  by 
\ppenclX 1: 
Discharge weigted 
Number  ed size 
(per  nt PRO  c: 100  100299  300+  Tota  average 
reabstractions 1

Urban  119 (26.  323 (19.  471 (21.  940  (21. 
Rural  528 (29.  22 (31.  65 (45.  788  (37. 
Teachig  19 (31.  94 (20.  233 (17.  (21. 
Nonteachig  628 (28.  451 (23.  303 (28.  1382  (26.4) 
Profit  50 (23.  99 (23.  14 (23.  163  (23. 
Nonprofit  597 (28.  44 (22.  522 (224)  1565  (23. 
Total  647 (28.  545 (22.  536 (225)  1728  (23. 
re 
delOra 
Apnd 
PRO  by 
pant 
Wei  rcenta 
ed size  hted
30+  Saple Disharge  Hospita 
c: 100  100299 
PRO revew 75.  74.  72.  74.  73.  74. 
Age 
(yea)  No revew  75.5  73.  71.  73.3  72.8  74. 
Sex  PRO revew 47.  45.  47.  46.  46.  46. 
(% male)  No revew  41.  45.  48.  45.2  46.  44. 
l.S  PRO reew  7.2  8.7  7.3

(days)  No reew  7.5  7.2  7.5

Mortity  PRO revew  7.3 
No revew  (y) 
ho dera
cong acccy 
PRO  by 
.ppenclX 3: 

iih rcenta 
l1umber  ed size  Saplteed   Hospita
Discharge 
Percent correct) c: 100  100299  300+ Tota 
urban  87 (73.  245 (75.  398 (79.  730  (77.  (78.  (75.
Rural  370 (70.  172 (77.5)  24 (63.  566  (71.  (72.  (71. 
reachig  11 (57.  72 (76.6) . 188 (80.  271  (78.  (79.  (67.
(74.  (75.2)  (73.
Nonteachig 446 (71.  345 (76.5) 234 (77.2) 1025 
112  (68.  (67.  (68. 
Profit  38 (76.  68 (68.  6 (42. 
(75.  (77.  (74.
Nonprofit  419 (70.  349 (78.  416 (79.7) 1184 
(75.  (78.  (73. 
Total  457 (70.  417 (76.  422 (78.7) 1296 
ho dera 
Ap 
accra 
4: R cong  by 
Wei  rcenta 
Number  ed size  Tota  Saplteed  Dicharge  Hospita 
(percent accte) c: 100  100299  300+ 
Urb  94 (79.  26 (83.  399 (84.  761  (82.2)  (83.0) .  (81. 
Rur  391 (74.  185 (S3.  51 (78.  627  (78.  (79.  (77. 
Teachig  13 (68.  77 (SI.  200 (85.  290  (7S.  (81.2)  (75.
Nontechi  472 (75.  376 (83.  250 (82)  1098  (SO.  (81.5)
 (79.

127  (74.  (72.6)  (76.4)
Profit  39 (78.  79 (79.  9 (64.

Nonprofit  44 (74.  374 183.  441 (84.5)  1261  (81.0)  (82.4)  (79. 
Tot  48 (75.  453 (83.  450 (84.  1388  (SO.  (81.  (79. 
Ap  pa 
5: PRO cog accy by 
Correc  Incorrect 
74.  74.

Age 
Sex (% mae)  46.  46.

LOS (days)

MortJity (%)
 Stca 
ApIX 6: 
1. M  dWi 
2. P  dWi 
3. SE  = (dW?SE?)l!2 
4. SEp = (dWi2pi(Pil)/Ni)l!2 
Where: 
d = sumation

p -= the 
popultion mean, 
with some characteritic, 
P p = the proporton of a populatio 
SEt =. the stadad error of the mean 
error of the proporton,

SEp = the stadard 
stta 
= the  weights,

= the stta means

= the strta proportons,

s& -= the stta stdard errors. 
statitics for meaurg relationships in cros-tabulations BOTEC used the 
When cacutig  strtum. We then 
followg procure: "Firt, we caculatesd ttatbule s sepateJy for each. 
table by its  weight, sumed thes etnttrues  to get an
weighted each entr of each  th  weights. The 
table by the sum of the 
overaD table, and divded each entr in 
wa used to cacuate the stengt of saple relationships and the 
resultig weighted table

sicace 
sttitica  of such relationships. 
fuer  ocrs frequentl in BOTEC's sttitica analis of Nationa DRG 
One  complication  foc  anis  hospita at other 
"Smeties the  of our  is upon 
ca 
Valdation Study data. 
 cas. In the former  the stta weigts we use

ties it is upon indivdual Medicae 
tota number of 
iners stta saplig rates for hospitals i.e., the ratio of the 
are the  which National DRG Valdation Study 
hospita in each strtum to the number of hospita 
sttum. 
In the latter cae the strta weights used are the inverse 
sapled from tht 
tota estiated number of Medicare
saplig 
rates for Medicare caes, i.e., the ratio of the 
ca  Valdation
in each strtum to the number of Medcare caes which National DRG 
sapled frm the strtum. 
Study