Cahaba GBA published in mid-July, and just recently rescinded, a draft local coverage determination (LCD) titled "IRF Admission after Single Joint Replacement with CMGs A0801-A0806 (DL32816)." The draft LCD discussed that while post-joint replacement rehabilitation is supported by literature, such rehabilitation does not necessarily need to occur in an inpatient setting. Cahaba explained that under the Inpatient Rehabilitation Facility (IRF) Prospective Payment System, payment is based on a coding process utilizing a prospective payment “grouper” known as the Case Mix Group (CMG), with the first character in each CMG representing a comorbidity tier. The comorbidity tier of “A” represents “no comorbidities.” Cahaba proposed that IRF admissions with the following Case Mix Groups would not be considered medically necessary: A0801-A0806. See draft LCD here.

During the comment period for such LCD, the American Hospital Association (AHA) drafted a response urging Cahaba to rescind the draft and stated that the LCD restricted national coverage of IRF services, which Cahaba was not permitted to unilaterally determine. The AHA also noted that such LCD would ignore a physician’s clinical assessment of medical need for the patient, which is a required element of determining whether IRF treatment is medically necessary. The AHA’s comment letter may be read here. Recently, Cahaba posted an update dated September 13, 2012 regarding the draft LCD on its website, stating, "The draft LCD for Surgery: IRF Admission after Single Joint Replacement with CMGs A0801-A0806 (DL32816) has been rescinded and will not be finalized." See Cahaba posting here. Notwithstanding Cahaba’s rescission of the draft LCD, it is likely that medical auditors will scrutinize IRF admissions for single joint replacements and may question the medical necessity of such admissions, whether Cahaba is the CMS contractor or another organization is.