Severe Sepsis/Septic Shock Early Management Bundle part of HVBP on Jan. 1: Are you ready?

By Brian Murphy

Hospitals are about to have (additional) reasons to get sepsis documentation and coding right.

As if they didn’t already.

Hospitals have been implementing and documenting the Severe Sepsis/Septic Shock Early Management Bundle, aka., SEP-1 for years through the Inpatient Quality Program. There were already incentives to document it, including payment.

But CMS in the IPPS 2024 final rule raised the stakes by adding it to the Hospital Value-Based Purchasing (HVBP) Safety Domain.

While the measure enters the Safety Domain in FY 2026, data collection on that domain begins Jan. 1, 2024. It’s admittedly a little confusing, to myself at least.

Just know that if you start work now, you will influence your eventual HVBP bonus or penalty later.

Failure to meet the measure will result in automatic penalties. HVBP is a budget-neutral program, funded by reducing participating hospitals’ base operating DRG payments each fiscal year by 2%. CMS then redistributes the entire amount back to the hospitals as value-based incentive payments.

That means if you underperform on these measures you lose 2% of IPPS payment, a potentially make-or-break number in an era of small hospital margins.

Who gets the 2%? Hospitals that perform better in their HVBP measures, including SEP-1. They are also eligible for added bonuses.

While the payment is somewhat indirect, it is very real. Smaller hospitals could lose “hundreds of thousands” of dollars in Medicare reimbursements annually; for large institutions, “it’s in the millions-of-dollars range,” according to Akin Demehin, senior director of quality and patient safety policy at the American Hospital Association (KFF Health News).

The addition of the SEP-1 bundle to the HVBP did not come without controversy. The American Hospital Association for example said SEP-1 results in the overuse of antibiotics, fueling antibiotic resistance.

But although it acknowledged these and other concerns, CMS pushed the proposal through. CMS claims that when the care interventions in SEP-1 are provided as a composite, it results in significant reductions observed in hospital length of stay, re-admission rates, and mortality. (CMS)

Now it’s here on our doorstep.

CDI and coding professionals can make an impact by doubling down on sepsis severity capture and accurate coding, in conjunction with their quality improvement teams.

Would love to hear from folks who have a good mechanism in place for capturing and reporting SEP-1. Any advice or best practice?

References and SEP-1 definition are below.


CMS, 2024 IPPS final rule:

KFF Health News:


What is SEP-1?

SEP-1 focuses on adults 18 years and older with a diagnosis of severe sepsis or septic shock. Consistent with Surviving Sepsis Campaign guidelines, it assesses measurement of lactate, obtaining blood cultures, administering broad spectrum antibiotics, fluid resuscitation, vasopressor administration, reassessment of volume status and tissue perfusion, and repeat lactate measurement. As reflected in the data elements and their definitions, the first three interventions should occur within three hours of presentation of severe sepsis, while the remaining interventions are expected to occur within six hours of presentation of septic shock. (QualityNet)

The clinical criteria used by the measure provides a well-established common set of criteria, identified as having high sensitivity for early identification of sepsis (72%–94.5%), that abstractors from all hospitals across the U.S. use to determine which patients from their initial populations remain in the measure. (CMS)

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