November 5, 2004

The Honorable Tommy G. Thompson
US Department of Health and Human Services
200 Independence Avenue,  S.W.
Washington, D.C.   20201

Dear Secretary Thompson:

In May 2004 the NCVHS issued a report entitled Measuring Health Care Quality:  Obstacles and Opportunities.  The Quality Workgroup together with the Subcommittee on Standards and Security conducted hearings based on the report.  One opportunity for data improvement was universally sought by the purchasers of care, endorsed by the providers of care and is poised for implementation by the Designated Standards Maintenance Organizations.  The NCVHS recommends that the next version of the Uniform Bill for Hospitals (UB04) and the ANSI ASC X 12N 837I HIPAA Implementation Guide be revised to facilitate reporting of a diagnosis indicator to flag diagnoses that were present on admission in secondary diagnosis fields for all inpatient claims transactions.

The secondary diagnosis indicator can help to distinguish between pre-existing conditions and those that developed, or were first recognized, during the hospitalization.  The ability to make this distinction can enable both case mix/severity of illness adjustment at admission and quality improvement opportunities in care processes.  There is experience collecting this information in New York and California hospital discharge systems, where it has proven valuable for both risk adjustment and outcomes assessment.

While testimony received on this recommendation has made a business case for including the diagnosis indicator on a claim, the Department should work with interested stakeholders to more explicitly describe the elements for effective implementation.  Testimony observed that variation in definition among users could reduce the benefit to be gained from the information collected.  The National Uniform Billing Committee and ASC X12N should work together to specify the code set, reporting conditions and use cases for the indicator.  Education and evaluation will be needed to assure that the information is recorded consistently and accurately.

The Workgroup will continue its liaison with the key organizations in the public and private sector that are addressing the information needed for quality measurement.

Sincerely yours,


John R. Lumpkin, M.D., M.P.H.
Chair, National Committee on Vital and Health Statistics

cc:  HHS Data Council Co-chairs

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