Clinical Documentation Improvement. A formula to better hospital funding.

It is said that “Doctors do not generate revenue; documents do” [David & Vinkhuyzen, 2013]. While an oversimplification, it stresses the point that clinical documentation is key in providing the platform for funding for both Public and Private hospitals in Australia. Documentation in the medical record forms the account of the activities performed and the resources that were utilised during a patient’s admission. With the introduction of casemix funding in the early 1990’s, clinical codes (and resultant Diagnosis Related Groups called DRGs) which reflect greater patient complexity are reimbursed at a higher rate than patients with lower complexity.

Clinical Documentation Improvement (CDI) aims to minimise missing, incomplete or conflicting documentation so that when processed, the data conveys the hospital’s true patient complexity. This in turn leads to the hospital being reimbursed appropriately for the level of service that was given.

It is crucial that hospitals accurately reflect the level of patient complexity in the medical record so they can be reimbursed appropriately for the level of care that was given. Missing, incomplete or conflicting documentation can all have an impact on how patient complexity is captured an affect the amount of reimbursement a hospital receives.

3M has a simple CDI opportunity estimator that will give hospital executives an impression of the financial impact associated with poor clinical documentation. It aggregates 3M’s findings from the Australian hospitals we have worked with to date. While not definitive, since each hospital has a different casemix and funding arrangements, different clinicians and differing levels of documentation, it does provide a feel for entitlement levels.


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