New CMS claims-based surgical quality measure is in effect; are you ready?

By Brian Murphy

 

In the 2025 IPPS final rule CMS finalized its proposal to replace PSI-4 (Death Rate Among Surgical Inpatients with Serious Treatable Complications) with a new claims-based measure: The Thirty-day Risk-Standardized Death Rate among Surgical Inpatients with Complications (Failure-to-Rescue).

 

In fact, this change has already taken place.

 

This new measure begins with the July 1, 2023 – June 30, 2025 reporting period, and impacts FY 2027 payment determination. Which means the data you are reporting now will impact your IPPS payment starting Oct. 1, 2026.

 

The measure denominator includes patients 18 years old and older admitted for certain procedures in the General Surgery, Orthopedic, or Cardiovascular MS-DRGs who were enrolled in the Medicare program and had a documented complication that was not present on admission. 

 

The measure numerator includes patients who died within 30 days from the date of their first “operating room” procedure, regardless of site of death.

 

Documented complications in the measure include cardiac events, congestive heart failure, hypotension or shock or hypovolemia, pulmonary embolus or deep vein thrombosis or phlebitis, CVA or TIA, coma, seizure, psychosis, nervous system complications, pneumonia or pneumonitis, pneumothorax/effusion, respiratory compromise or bronchospasm, internal organ damage or perforation, peritonitis, gastrointestinal bleed and blood loss, sepsis, deep wound infection or wound complication, renal dysfunction, gangrene/amputation, intestinal obstruction or ischemia, retained foreign body, pressure injury, orthopedic complication, hepatitis or jaundice, pancreatitis, necrosis of bone (thermal or aseptic), osteomyelitis, disseminated intravascular coagulation (DIC), pyelonephritis, or other postsurgical complication.

 

The new measure has four major differences compared to PSI-4: 

 

1. Captures all deaths of denominator-eligible patients within 30 days of the first qualifying operating room procedure, regardless of site. This represents a larger patient population than PSI-4.
2. Limits the denominator to patients in general surgical, vascular, and orthopedic MS-DRGs.
3. Excludes patients whose relevant complications preceded (rather than followed) their first inpatient operating room procedure, while broadening the definition of denominator-triggering complications to include other complications that may predispose to death (for example, pyelonephritis, osteomyelitis, acute myocardial infarction, stroke, acute renal failure, heart failure/volume overload). 
4. Includes Medicare Advantage patients.

 

Many hospitals hold all mortality claims for review before releasing for billing to ensure they’ve been optimized for severity of illness/risk of mortality. But now they must add Medicare Advantage deaths (if they weren’t already). And because the new measure excludes patients with relevant complications preceding their procedure, capturing these is more important than ever.

 

As a reminder, the Hospital Inpatient Quality Reporting (IQR) Program is a pay-for-reporting quality program that reduces payments to hospitals that do not meet program requirements. Hospitals that do not submit quality data or do not meet all Hospital IQR Program requirements are subject to a one-fourth reduction in their IPPS annual payment update. 

 

Of course, there’s much more than money on the line with good performance. CMS tested the measure and concluded that if hospitals in the worst quartile (bottom 25%) were to improve to the performance of hospitals in the top 25%, it would represent a 50 percent decrease in the frequency of deaths after postoperative complications.

 

Overall this represents another step in the move toward value-based purchasing over fee for service.

 

What do you think? How much emphasis does your organization put on measure performance from a coded data standpoint?

 

References

 

2025 IPPS final rule (measure discussion begins on p. 1515): https://public-inspection.federalregister.gov/2024-17021.pdf 

 

Partnership for Quality Measurement: https://p4qm.org/measures/4125