Erroneous Coding for Schizophrenia a Major Concern

On Jan. 18, 2023, the Centers for Medicare and Medicaid Services (CMS) issued memorandum QSO-23-05-NH outlining plans to adjust quality measure (QM) ratings based on erroneous schizophrenia coding.

CMS launched focused schizophrenia onsite surveys in 2016 to specifically address the issue of erroneous coding of schizophrenia in nursing homes. These surveys identified facilities with patterns of erroneous coding of residents with a diagnosis of schizophrenia. To increase its focus on this issue, CMS will begin conducting offsite audits to assess the accuracy of Minimum Data Set (MDS) data.

Earlier this year, CMS conducted pilot audits to test the effectiveness of the MDS audit process. During these pilot audits, CMS found several issues related to the inaccurate MDS coding of residents with a diagnosis of schizophrenia. For example, there was an absence of comprehensive psychiatric evaluations and behavior documentation. Also, many residents had only sporadic behaviors noted in their medical records, and these behaviors were related to dementia, rather than schizophrenia.

Facilities selected for an audit will receive a letter explaining the purpose of the audit, the process that will be utilized, and instructions for providing supporting documentation. During the audit process, facilities will have the opportunity to ask questions and seek any clarification needed.

Facilities that have coding inaccuracies identified through the schizophrenia MDS audit will have their QM ratings adjusted as follows:

• The Overall QM and long-stay QM ratings will be downgraded to one star for six months (this drops the facility’s overall star rating by one star).
• The short-stay QM rating will be suppressed for six months.
• The long-stay antipsychotic QM will be suppressed for 12 months.

CMS will continue to monitor all facilities identified for an audit, regardless of the outcome of the audit. The length of follow-up will vary and is intended to confirm process change. CMS will also share this information with the state survey agency for all nursing homes identified for audit.

For resources that may be helpful in identifying coding inaccuracies and addressing ineffective processes, visit the LeadingAge National Nursing Home Requirements of Participation (RoPs) Tools and Resources page.

Contact: Elliott Frost, efrost@leadingageny.org, 518-441-8761