Section R9-22-712.60. Diagnosis Related Group Payments

A.      Inpatient hospital services with discharge dates on or after October 1, 2014, shall be reimbursed using the diagnosis related group (DRG) payment methodology described in this section and sections R9-22-712.61 through R9-22-712.81.

B.       Payments made using the DRG methodology shall be the sole reimbursement to the hospital for all inpatient hospital services and related supplies provided by the hospital. Services pro- vided in the emergency room, observation area, or other outpa- tient departments that are directly followed by an inpatient admission to the same hospital are not reimbursed separately. They are reimbursed through the DRG methodology and not reimbursed separately.

C.      Each claim for an inpatient hospital stay shall be assigned a DRG code and a DRG relative weight based on version 31 of the All Patient Refined Diagnosis Related Group (APR-DRG) classification system established by 3M Health Information Systems. If version 31 of the APR-DRG classification system will no longer support assigning DRG codes and relative weights to claims, and 3M Health Information Systems issues a newer version of the APR-DRG classification system using updated DRG codes and/or updated relative weights, then the more current version established by 3M Health Information Systems will be used; however, if the newer version employs

updated relative weights, those weights will be adjusted using a single adjustment factor applied to all relative weights to ensure that the statewide weighted average of the updated rela- tive weights does not increase or decrease from the statewide weighted average of the relative weights used under version 31.

D.      Payments for inpatient hospital services reimbursed using the DRG payment methodology are subject to quick pay discounts and slow pay penalties under A.R.S. 36-2904.

E.       Payments for inpatient hospital services reimbursed using the DRG payment methodology are subject to the Urban Hospital Reimbursement Program under R9-22-718.

F.       For purposes of this section and sections R9-22-712.61 through R9-22-712.81:

1.        “DRG National Average length of stay” means the national arithmetic mean length of stay published in ver- sion 31 of the All Patient Refined Diagnosis Related Group (APR-DRG) classification established by 3M Health Information Systems.

2.        “Length of stay” means the total number of calendar days of an inpatient stay beginning with the date of admission through discharge, but not including the date of discharge (including the date of a discharge to another hospital, i.e., a transfer) unless the member expires.

3.        “Medicare” means Title XVIII of the Social Security Act, 42 U.S.C. 1395 et seq.

4.        “Medicare labor share” means a hospital’s labor costs as a percentage of its total costs as determined by CMS for purposes of the Medicare Inpatient Prospective Payment System.

Historical Note

New Section made by final rulemaking at 20 A.A.R.

1956, September 6, 2014 (Supp. 14-3).