CMS Pub. 100-04, ch. 3, § 20.2.2

The A/B MAC (A) pays for inpatient hospital services on the basis of a rate per discharge

that varies according to the MS-DRG to which a beneficiary's stay is assigned. Each MS-DRG represents the average resources required to care for a case in that particular MS-DRG

relative to the national average of resources consumed per case. The MS-DRG weights used

to calculate payment are in the Pricer DRGX file.

The A/B MAC (A) uses the GROUPER program to assign the MS-DRG number.

GROUPER determines the MS-DRG from data elements reported by the hospital. This

applies to all inpatient discharge/transfer bills received from both PPS and non-PPS facilities,

including those from waiver States, long-term care hospitals, and excluded units.

The Pricer (PPSMAIN) driver program calls the correct fiscal year GROUPER based upon

the discharge date. If the A/B MAC (A) or shared system writes its own driver program, it

must access the GROUPER for the correct FY based on discharge date. GROUPER does not

determine the MS-DRG price. GROUPER input/output are specified below. The A/B MAC

(A) determines the best place in its total system to place the GROUPER program.

Grouper requires the following items:

1. Principal and up to 24 other diagnoses

2. Principal and up to 24 additional procedures

3. Age at last birthday at admission

4. Sex (1=male and 2=female)

5. Discharge destination (patient status code from the claim)

The claim sex coding is M for male and F for female while GROUPER is l for male and 2

for female. Discharge destination codes are similar to claim definitions for patient status

except codes 20-29 are summarized as 20. The A/B MAC (A) calculates age at admission.

GROUPER needs age rather than date of birth.

Grouper responds with the following information:

1. Major diagnostic category

2. MS-DRG number

3. Grouper return code (a one position code indicating the action taken by the program)

4. Procedure code used in determining the MS-DRG

5. Diagnosis code used in determining the MS-DRG

6. Secondary diagnosis code used in determining the MS-DRG, if applicable