Imagine this scenario: You are a 70-year old Medicare patient who is extremely active and healthy (i.e., no co-morbid conditions). By virtue of being overactive, you've developed arthritis. You've just had a right total knee replacement performed two days ago and other than some expected pain, you seem to be doing just fine. But while relaxing watching TV in your hospital bed, you develop severe shortness of breath and call for the nurse immediately. The surgeon is called and you are subsequently diagnosed with a postoperative pulmonary embolism directly related to the knee replacement.

Although, this scenario seems like one that may not happen frequently, these types of conditions that develop solely while in a hospital setting (i.e. hospital acquired) do occur -- and cost payers billions of dollars each year. Payers and healthcare organizations alike are able to identify such situations by appending present on admission indicators (POA indicators) to the ICD-9-CM diagnosis codes for acute inpatient admissions. 


Required by the Deficit Reduction Act of 2005, reporting of POA indicators have been considered mandatory since April 1, 2008 for acute inpatient hospital admissions. Each eligible diagnosis code must have a POA indicator appended to determine whether a certain diagnosis was considered to be present on admission. The options for POA assignment are:

- Y = Present at the time of inpatient admission
- N = Not present at the time of inpatient admission    
- U = Documentation is insufficient to determine if condition is present on admission
- W = Provider is unable to clinically determine whether condition was present on admission or not    
- 1 = Unreported/Not used (or "1" for Medicare usage) (Exempt from POA reporting) - equivalent of a "blank"

Since each eligible diagnosis has a POA indicator, can any diagnosis affect the reimbursement received by the facility? Let's dig deeper into the importance of accurate and compliant POA reporting.

Hospital acquired conditions (HACs)
 
CMS was instructed to select at least two conditions that met the following criteria, as required by the Deficit Reduction Act of 2005: