2008 Roadshow Questions and Answers _doc_ - 2008 HRG4 Roadshows by maclaren1


									HRG4 Roadshows 2008
 Questions & Answers
2008 HRG4 Roadshows Questions

HRG4 Design and Definitions

One of the issues Dr Griffin mentioned was the „over coding‟ of (say) Asthma – where
ICD provides 6 possibilities when he only wants one. Yet he talks of the improvement
of HRG4 in providing greater granularity. Can he explain this contradiction?
HRGs are primarily used for costing and payment purposes. Although providers
should endeavour to code as specifically as possible, for the purpose of HRGs it is
not essential to distinguish between variants in care that cost the same.
However, it is important to differentiate cases with relevant complications and
comorbidities, to properly reflect the differing cost profiles of simple and complex
patient treatments, hence the need for a refinement of „splits‟ to give improved
granularity within HRG4.
ICD 10 is a statistical classification and the above question on granularity is often a
common misconception of such a schema. The ICD-10 provides statistical
representation at both the third character (parent concept) the fourth character (child
concept) level which allows the user the ability to capture and therefore retrieve
information containing further granularity on the disease or related health problem.
The fourth character representation in the ICD-10 allows for either greater reporting
for the “type” or “cause” of the disease, depending upon the axis of the classification.
In the case of Asthma J45.0 predominantly allergic asthma is a more specific
description than J45.9 Asthma unspecified. It is important to remember that both the
ICD and OPCS classifications provide comparable statistical data used for purposes
other than HRG derivation.

The work of HRGs so far seems to be very acute hospital focused. Given the
governments started intention to move care closer to home / community services, will
HRG4 deal more successfully with care provided in community hospitals and with
other community provided services?
HRG4 supports payment for care regardless of setting. For example, where a
procedure could be delivered in a variety of settings, such as a minor operative
procedure that could be performed as an admitted case or as an outpatient, the
same HRG will be assigned regardless of setting. However, the tariff applied may
vary according to setting to reflect differing cost profiles, e.g. to allow for the cost of
an overnight stay.
The structure of HRG4 also supports „setting independence‟ by allowing discrete
elements of patient care to be separately identified and unbundled from the core care
episode. For example, a stroke patient could receive initial care at an acute hospital
but go to a community unit for their rehabilitative care. Thus HRG4 offers greater
scope to accurately describe care delivered in a community setting. However at
present, no underlying dataset is available on which to base Casemix classifications
that accommodate services that are traditionally provided only in the community
As part of our work for the Next Stage Review, DH are looking at the potential of
developing currencies specifically for community services. Any programme of work
would need to take account of challenges around information systems, availability of
data and overlaps in provision between care from GP practices and care from
community services such as district nursing.

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Will HRG4 support the concept of a super spell i.e. where a patient‟s care spans two
trusts / providers e.g. acute stroke in trust and rehabilitation in PCT provider?
HRG4 does not construct „super spells‟ to represent multi-provider care pathways.
Spells are handled in accordance with the NHS Data Dictionary definition and cover
the care delivered by an individual provider organisation from patient admission to

The introduction of new HRGs with major CC will encourage clinicians to compile
their notes so that procedures are upcoded. How is the inevitable „tariff drift‟ going to
be constrained?
The extension of complication and co morbidity logic in HRG4 has been designed to
better reflect variations in care costs and to make it possible to reimburse
appropriately rather than on a „case average‟ basis.
HRGs group cases for payment purposes and therefore rely on accurate and
complete coding. However HRGs are not the prime driver for clinical coding, which
must always be undertaken in accordance with national standards in coding
guidelines to properly represent patient diagnoses and treatments. The Audit
Commission will be undertaking annual audits of providers‟ coding practice to ensure
that appropriate processes are being followed and that data are clinically accurate.

If HRG4 is the first „custom-fitted‟ version, what flaws does it put right and what is the
overall financial effect?
HRG4 is a major revision of existing groupings that takes into account complex cases
and extends the scope of groupings beyond admitted care to new clinical settings.
HRG4 design includes:
o Increased clinical coverage, including Specialist Palliative Care, Diagnostic
    Imaging, Chemotherapy, Radiotherapy, Critical Care and Rehabilitation.
o Improved use of Complications and Comorbidities, to better reflect variations in
    severity and complexity.
o Unbundling - to handle high cost drugs and other high cost elements of care.
    Unbundling of high cost elements will improve the performance of HRGs so that
    they can better represent activity and costs.
o Setting independence - unbundling will help to make HRGs 'setting independent'
    so that healthcare can be provided and funded across a variety of settings
The aim is to provide a system that supports flexible and equitable contracting and
reimbursement for a wider range of services, replacing current „block payment‟

Where can I get an electronic copy of HRG4 definitions and descriptions? Where will
I be able to get a copy of the prices when they are issued?
HRG4 definitions and descriptions are available for download from the IC Casemix
website at http://www.ic.nhs.uk/our-services/standards-and-
HRG4 tariffs will be published on the DH PbR website when available.

Will there be a further evolution to HRG5?
The version change from HRGv3.5 to HRG4 reflects the major design changes that
have been made. There are likely to be a number of future adjustments and
extensions to HRG4 but there are no plans to make major changes to the design
model at this time.
The DH have commissioned an overall review of coding and classification systems to
inform a long term strategy for the development and use of coding schemata and
classification systems.

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When can we expect HRG5?
As a general principle, HRGs undergo an annual review process, and a three-five
year revision. Thus there will be incremental revisions and additions to HRG4 to
incorporate additional services and reflect ongoing changes in clinical practice. All
changes utilise the experience of the EWGs and are managed through a formal
change control process, in line with Grouper release timescales.

Will HRG4 avoid problems of minor procedures being mapped to major HRGs?
The design of HRG4 addresses these mapping issues.

Why are there no HRGs for screening, such as mammography? There should be
patient choice here
The scope and coverage of HRGs is informed by DH policy
The Cancer Reform Strategy, published December 2007, stated:
“To incentivise services to encourage higher coverage we will explore moving to an
activity based system for funding screening services.” (Para 3.10)
This work is still at an early stage. The PbR Team will be working closely with the
National Cancer Action Team and the DH Cancer Policy Team to evaluate the case
for activity based funding in screening services.
For reference, the full document is available at:

HRG4 Clinical Engagement

There has been a lot of emphasis on engaging clinicians about HRG4. However the
onus should not all be on finance professionals. Has the message about the
importance of HRG4 been disseminated through clinical channels?
A roadshow event with a greater emphasis on clinical aspects of the uses of HRG4
was held on 22 April 2008.
Continued engagement via the S&C Expert Working Groups [EWG‟s] will further
enforce this message.
The NHS Classifications Service also provides guidance to non-coders, including
clinicians, on the role of the clinical coding professional as the first stage in the HRG
process. This is particularly important since the enhancement to OPCS-4 which
increased liaison between the financial, clinical and coding professions at a local
level. www.connectingforhealth.nhs.uk/clinicalcoding/noncoders.
www.cfh.nhs.uk/ clinicalcoding/codingstandards/opcs4/downloads/factsheets/

Publications to date, such as the The Royal College of Physicians' Information
Laboratory‟s “Top ten tips for coding” [see http://hiu.rcplondon.ac.uk/ilab.asp] seeks
to ensure that appropriate information is available to support clinicians in the move to

Looking at the delegate list, it appears that not many clinicians have attended today‟s
event. Do the Royal Colleges provide their own HRG4 roadshows or awareness
sessions? Should clinicians also attend these roadshows and do the Royal Colleges
promote that they should attend these events?
An additional roadshow event was held in April 2008 with a particular focus on the
clinical aspects of HRG4. This event has been promoted through our Expert Working
Group network. In addition, the EWG clinical leads are tasked with ensuring that they
disseminate appropriate and relevant information through to the respective Royal
Colleges and national associations that they represent.

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Please could you issue a briefing paper about the HRG4 logic, bundling and
unbundling and pricing
Documentation can be downloaded from the „Prepare for HRG4‟ area of Casemix
website. Please see „HRG4 Design Concepts‟, HRG4 Definitions and the „Guide to
Unbundling‟. Further documentation will be available during the year that will clarify
unbundling from an HRG4 design, costing and pricing perspective.

Critical Care Services

How does Critical Care Activity get fed through HRG4 for each of adult, NICU and
Adult Critical Care HRGs are based on the level of support required by the patient, as
evidenced by the number of organs supported. This information is recorded in the
Adult Critical Care dataset, a subset of the Admitted Patient Care [APC] minimum
dataset. The revised version of the admitted care dataset in CDS version 6,
mandated for implementation from April 2008, will also contain subsets relating to
paediatric and neonatal critical care. Completion of these fields will enable the
generation of an HRG4 unbundled HRG per diem, for each of paediatric and
neonatal critical care services.
These are generated in addition to any other HRGs such as the core HRG for the
overall FCE/spell and separately unbundled HRGs such as renal dialysis that may be
assigned to the episode or spell.
For a fuller explanation, please see Chapter Summaries – Chapters XA/XB Neonatal
and Paediatric Critical Care, and Chapter XC Adult Critical Care.

The methodology for costing Adult Critical Care, based on a number of organs
supported is not supported by clinicians at my Trust. They strongly believe this is not
the best way of costing activity in critical care. Are there any plans to change this
methodology? How do we get this message back to the relevant clinical working
The development of currencies for adult critical care is based on research that
covered more than 70 intensive care units and tens of thousands of patient records.
The outcome of that research showed that the number of organs supported is the
best methodology for costing activity in critical care. The methodology and outcome
has been accepted by a wide range of clinicians, authoritative professionals, and
professional bodies, and was endorsed and taken forward by the expert advisory
group on critical care, the Critical Care Information Advisory Group.
DH do not have any plans to change this methodology, but will assess any evidence-
based proposals that indicate alternative methods for costing activity are better.
For issues about tariff development based on the current number of organs
supported methodology, Trusts can write to Jean-Armand Clark, Development
Branch - Payment by Results, Department of Health, 3W52 Quarry House, Quarry
Hill, Leeds, LS2 7UE.

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Information Flows and Data Comparison

Will community activity be mandated to flow through SUS in order to capture the PbR
element? How will SUS be prepared ready for HRG4 implementation given the
constraints of the BT contract?
The local payment grouper in SUS will continue to be based on HRG v3.5 for the
2008/09 financial year. Grouping for payment on the basis of HRG4 will be
operational from April 2009, in line with PbR policy decisions.

Could the NHS as a whole coordinate CDS, PAS systems and SUS requirements?
E.g. NPfIT systems do not extract CDSv5 requirements and trusts have to change
/collate data to meet these standards. Its very time consuming and too much of an
Also, SUS process to disseminate data takes far too long from a trust and PCT
position. I hope this can be improved significantly
All HRG design and CDS changes are subject to Information Standards Board for
Health and Social Care (ISB) approval processes that ensure that the change is both
necessary and implementable. For HRG4, there is no expectation that PAS systems
will need to be changed to incorporate a revised grouping function. There is no
necessity to derive or hold HRGs within local PAS systems. Grouping data for
payment purposes is derived from source CMDS data submitted to SUS.

Isn‟t the assumption that „patients present to providers who record on PAS‟s a
misrepresentation of the care pathway? Surely the complex referral/contract/control
with commissioners is also relevant?
Recording of activity through PAS is the primary mechanism through which treatment
data are collected for both planning and payment purposes. However, although the
data collected through PAS are used to inform tariff derivation, they are not the sole
determinant in determining tariffs or framing contract arrangements. The over-
simplification of the data model was an attempt to communicate the overall process
of data management rather than intended to reflect current local practices.

PbR Guidance and SUS – Need more precise guidance (and SUS algorithms) to cut
down on ambiguity e.g. care identification: non consultant led Ops, where consultant
specialty code is not non-consultant but consultant code is N….. or H…… or M……
This can get costed through PbR, inflating cost to purchaser.
Thank you for your comments. DH will take them into consideration when
updating the reference cost and tariff guidance.

HRG v3.5 and 4 comparison: guidance on types of comparisons to make would be
useful, for information staff to produce some reports for commissioners.
The NHS IC are at present investigating the feasibility of grouping national data to
enable commissioners to compare provider-level data using both HRG v3.5 and
This information does exist nationally on the Casemix prepare website at
The available data are for the 2006/07 financial year [HES] and have been grouped
with the Reference Costs 2006/07 grouper. This information will be updated with
more recent data and grouped with the HRG4 2007/08 Reference Costs grouper by
the end of July 2008.

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What are the plans to improve NSTS?
The plan is to decommission it at the end of December 2008. Up until that point the
IC will continue to improve the data quality and make a few changes to tighten up on
a couple of areas identified by a recent penetration test.

Non-admitted Consultations

There was a DSCN that mandated „ward attenders‟ to be submitted to SUS with the
outpatient dataset. But when extracting SUS or dataset how do you identify the „ward
The HRG4 grouper will process all valid activity data submitted within the OP dataset
– it does not differentiate ward attenders as a distinct category. Data entry for ward
attenders at local level should comply with NHS CFH Data Dictionary guidance.

Is coding of Outpatients going to be made mandatory and if so when?
Does the setting independence of HRG4 mean that we should now start coding Out
Patient appointments? In a trust with 90,000 IP / DC and 450,000 Out Patient
Attendances this would lead to a five-fold increase in the clinical coding workload.
What advice please?
As part of the Options for the Future of PbR consultation DH asked if it would be
feasible and desirable to code for HRGs in the outpatient and community setting. A
clear majority (69%) of respondents thought it would be desirable. 46% thought it
would be feasible, 25% were undecided and 29% thought it was unfeasible.
Therefore, where relevant DH will encourage the use of coding in out of hospital
settings (and in reality only a small percentage of outpatient attendances would map
to a procedure based HRG), but are not planning to mandate it at the present time.

Emergency and Urgent Care

No mention of A & E grouping was made. Please provide guidance
Existing Accident and Emergency (Version 3.2) HRGs use disposal and investigation
codes to determine the HRG assigned to each attendance. Version 3.2 HRGs do not
take into account any treatments given to the patient.
In HRG4, treatment and investigation codes are used to determine the HRG
assigned to each attendance. Please see Chapter Summaries – Chapter VB

Collecting and Recording Data

Will we run out of fields for the data?
Coding guidance suggests that each episode of dialysis should be recorded.
However, it is acknowledged that the 12 procedure code fields in the admitted care
dataset in CDS version 5 may limit the ability to record every episode of dialysis
during an inpatient stay, especially if other types of procedure have been undertaken.
This should not be an issue for out patient treatment, where a new dataset is created
for each attendance.
The revised version of the admitted care dataset in CDS version 6, mandated for
implementation from April 2008, has no limitation on the number of procedure codes
that can be recorded.

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If a patient has dialysis every three days in an extended LOS, how do you ensure
that each dialysis is recorded and charged as well as all other interventions?
Any procedures performed ought to be coded regardless of length of stay.

HRG4 Groupers, Grouping Data and Grouper Output

The grouper release schedule shows the release date for OPCS-4.5 as April 2009. It
then indicates this will be in use until 2011/12. Is this the case?
The HRG4 grouper release schedules include HRG4 groupers for both costing and
payment purposes.
OPCS-4.5 will be incorporated directly into the HRG4 design with effect from 1st April
2009, when the data are mandated to flow pending approval from the ISB. OPCS-4.5
will therefore be included in the 2009/10 HRG4 Reference Costs grouper. In turn, the
2009/10 HRG4 Reference Costs grouper forms the basis of the 2012/13 HRG4 local
payment grouper.

What is the spell HRG in HRG4 -i.e. how does HRG4 know which FCE-HRG should
be the spell HRG as there is no dominant FCE? How does the grouper handle this?
How does the grouping logic group spell data differently from FCE data? What data
fields are used? Which FCEs form part of a complete spell?
A finished consultant episode [FCE] represents a period of admitted care under a
single consultant.
A provider spell represents a period of continuous admitted care under a single
provider organisation; a spell may contain one or more consultant episodes.
An inpatient spell commences at admission and ends with the discharge of the
patient. It therefore includes all FCEs that occur between these two events.
The HRG4 grouper will assess all the procedures in the spell against hierarchical
tables. If one or more significant procedures have been recorded, the spell HRG is
derived from the dominant procedure, as determined by reference to a table of
procedure hierarchies. If no significant procedure is recorded, grouping will be based
on the most significant primary diagnosis, as determined by a primary diagnosis
Where the first episode in the spell is a multiple trauma HRG, this will always drive
the grouping of the spell.

Will the IC publish its data validation rules as soon as possible so that PCTs can
apply them to SUS data and highlight problems back to the providers?
The data validation rules for HRG4 are published on our website. Please see the
„Guide to file Preparation‟ (web link). This information can be used to analyse
provider level data as reported through SUS.

Is diagnosis used in grouping outpatient data?
No. As diagnosis is not mandated as part of the outpatient CDS, nor does the validity
of an outpatient attendance rely upon there being a diagnosis, the current HRG4
design does not utilise diagnosis when deriving an HRG for the outpatient
attendance, even where these data are present.

Can we expect differences in output between the local (standalone) grouper and the
central (definitive) SUS grouper, assuming identical input datasets? Will these
differences be significant?
Both groupers apply the same grouping logic and given the same input file will derive
the same HRGs. Both systems will validate input data and will reject episodes where
the data are insufficient for grouping. However, SUS is used for other functions and

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therefore carries out more extensive input file validation. It is therefore likely that
more episodes could be rejected by SUS and therefore not be grouped.
There are also minor differences in the way that the groupers handle „imperfect‟ data.
Therefore there may be minor differences between outputs, though these should not
usually be significant.

As a commissioner, I need to see the logic that groups a spell that is not one of the
FCE HRG. We need to identify how this works to explain how a different HRG has
been reached. Is it in the Code to Group table on your website?
The „single spell grouping‟ function in the standalone grouper will allow you to enter
data for each episode in a spell and group this to view the result. This would allow
you to model individual FCE and multi-episode spell grouping to examine differences
at a patient record level. The Code to group table on the website provides details of
all the logic employed in the grouper whether determining an appropriate HRG at an
episode or spell level.

Can training events be organised for HRG4? We believe that local training events
would be valuable for provider trusts and PCTs as these would focus attention on
local arrangements and help to identify where specific processes may need to be
The NHS Information Centre has developed the Group It! business simulation game
to illustrate the key processes in HRG derivation and this is freely available for local
organisations to use in local training and awareness sessions. In addition, there are
plans for an ongoing programme of training and development to support the NHS
throughout the 2008/09 financial year, in preparation for the 2009/10 introduction of
HRG4 for funding under the PbR national tariff.
PCTS can also book bespoke training courses to better understand clinical coding
data from the NHS Classifications Service at NHS Connecting for Health.

When will the grouper work on Vista?
The HRG4 Reference Cost Grouper version 4.1.0 and later versions will work on
Windows Vista.

Why does it take a grouper to get a grouper to get a grouper to get to an HRG4
Payment grouper?
The production of groupers is an iterative process.
A fundamental premise of Casemix design is that the groupings produced are,
amongst other things, iso-resource. Assuming that cost is a proxy for resource, iso-
resource groupings are therefore evidenced by the Reference Costs grouper. Such
costs are not affected by policy decisions which can be used to incentivise certain
NHS behaviours via the reimbursement mechanism. So the starting point for a suite
of groupers is the Reference Costs Grouper, which can provide credibility in the
underlying resource groupings, a prerequisite for future use of such groupings as a
mechanism for funding. This also reflects the process by which DH, currently,
produces the prospective national tariff, based on retrospective costed activity.

With regard to payment, the Grouper release schedule follows the DH SenseCheck
and RoadTest process, which occurs prior to launching a Grouper to be used for
payment calculations in any given financial year. Thus there is a requirement for DH
PbR to test the draft tariff (SenseCheck), and then for the NHS to understand the
tariff impact at a local level for planning purposes (RoadTest). Issues revealed during
the SenseCheck process must be rectified prior to the release of the RoadTest
grouper. There is also the possibility that amendments may be required following
RoadTest, which are then incorporated into the final tariff and local payment grouper.

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Separate grouper products ensure that this iterative process of grouper development
allows full visibility for users. It also reflects the fact that grouping for costing, rather
than reimbursement purposes may have necessary, and valid differences.
A document is being produced that explains the purpose of each grouper, and when
they should be used. This will be published on the Casemix IC website.

Auditing and The Audit Commission

How are the Audit Commission putting pressure on NHS CFH to improve the clinical
coding training – are national training courses (diplomas) going to be provided?
The continual improvement of clinical coding standards and coding audit is a major
objective of the assurance framework. The Audit Commission works closely with the
NHS Classifications Service of NHS CFH when analysing the results of the coding
audits and its implications for the training of clinical coding. The Audit Commission
regularly meets with the NHS Classifications team within NHS CFH to share
emerging findings and the implications for coding training. A national summary of the
results of the audit will be published in summer 2008, to which NHS CFH will respond
to any issues raised.
Furthermore, this analysis informs any necessary development to the currently
extensive suite of training products offered to the NHS by the NHS Classifications
Service. The products help NHS organisations in their responsibilities to provide
continual professional development to their coding workforce with centrally produced
resources provided at no cost. It also ensures consistent delivery of coding training
across the NHS. It is imperative that NHS organisations invest in their clinical coding
departments to ensure their workforce receives initial foundation course training
followed by a programme of continued professional development to guarantee
standards are maintained. A clinical coding accreditation programme has existed for
a number of years and is the only recognised National Clinical Coding Qualification
(UK) which gives career clinical coders a recognised qualification.

At present there isn‟t a single source site that covers all aspects of benchmarking.
Even using the PbR benchmarking / NHS comparators etc. it is not possible to see /
compare all the different areas by trust and for instance to see how trusts are doing
in terms of „quartiles‟. Is there a possibility of more comprehensive benchmarking
tools being made available in future?
Any site would not be completely comprehensive because of the commercially
sensitive analysis undertaken by private sector companies such as Dr Foster and
CHKS. However, The Audit Commission are working closely with the IC and other
central organisations to share knowledge, understand the individual purpose of the
specific tools that are currently available, promote and provide links to other relevant
tools on our websites and ultimately consider delivery of similar or linked tools
through one platform or point of entry.

Are The Audit Commission audits audited? If so, who undertakes these audits and
what percentage are audited?
All of the clinical coding audit suppliers used by the Commission are contractually
required to implement arrangements for assuring the quality of work which they
deliver. These arrangements are reviewed annually by the Commission and
recommendations are made to improve arrangements where necessary. The
Commission is strengthening these arrangements in 2008/09 by ensuring all auditors
are subjected to peer review and have agreed with NHS CFH that lead auditors will

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be subject to an independent review by them during the course of the year to ensure
that the audit methodology is being applied consistently.

The Audit Commission need to look further than OPCS and Diagnosis errors in
coding for gaming: duplicates, splitting of attendances and not declaring correct
specialty on non consultant led activity
Currently the Commission‟s audits and benchmarking are focused on Admitted
Patient Care. In the autumn of 2008/09 the Commission will introduce Outpatient
audits and benchmarking which will address these issues.

Coding and HRG4

Are there any plans for there to be a clinical coding lead nationally to inform HRG
and coding processes and advise Trusts on implementation of new classifications?
The NHS Classification Service is the definitive source of clinical coding guidance
and sets the national standards used by the NHS in coding clinical data. It has been
the first point of contact for all coding queries and national strategy for many years.
This is the continued role of the NHS Classifications Service which provides clinical
coding support through its help desk and their team advise on national initiatives -
including implementation of classifications to NHS organisations – see
www.cfh.nhs.uk/clinicalcoding. The NHS Classifications Service collaborates with
the IC clinical coding specialist where appropriate on HRG requirements. This
maintains the integrity of the classification when faced with potentially difficult
authoring to fit the needs of the HRG algorithm while staying true to the principles of
the classifications to ensure robust and comparable data standards and quality. For
further information regarding implementation of classifications contact NHS CFH at
The Casemix clinical coding specialist works with clinical expert working groups and
liaises with the NHS Classifications Service to ensure that HRG design is
coordinated with the source coding schema.

Are there plans for a national clinical coding strategy to underpin the tariff / HRG
framework? Clinical coding underpins the PbR framework. Are there plans to
standardise coding as a Profession and to have a coding profession with a structure?
Are there plans to have a national clinical lead to shape the coding profession
nationally? Will there be a national clinical coding lead as part of the PbR data
assurance framework?
Clinical coding does not exist solely to support the national tariff.
NHS CFH is responsible for the maintenance and evolution of the national clinical
coding methodology.

When will all HRGs incorporate SNOMED CT which is being built into other CFH/
NHS National Programmes? When will SNOMED CT replace OPCS-4?
OPCS-4 is a national information standard and the scheduled annual reviews of the
OPCS-4 classification will continue as planned until further notice see
DH are planning to commission a wide ranging review of coding and classification
systems. This will consider options for the long term replacement of OPCS-4, if
considered appropriate.

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HRG v3.5 has resulted in many queries from PCTs about the about the coding
quality of patient level data quality which has put a strain on the coding service. Is it
envisioned that HRG4 will increase or decrease the level of queries that may be
targeted at any clinical service?
Data quality issues raised by PCTs may be in part as a result of the current HRG
grouping mechanism being out of date with the current statistical classifications in
use in the NHS. The clinical coding community capture their clinical activity using the
ICD-10 for diagnosis and OPCS-4.4 for Interventional and Procedural activity. HRG
v3.5 (the current grouper in use for reimbursement) groups from OPCS-4.2 codes
which are retrospectively mapped from OPCS-4.4 using the Tables of Coding
Equivalence. This will continue to be the case for reimbursement until April 2009
when the HRG4 2009/10 Local Payment grouper is released to the NHS.
HRG4 is designed to enable a greater percentage of provider activity to be recorded
and reimbursed through PbR. As reimbursement processes are dependent on the
completeness and accuracy of activity data recorded using ICD and OPCS codes,
this will mean an increase in the perceived importance of coding and this may lead to
an increased number of queries.
PCTs can also book bespoke training courses to better understand clinical coding
data from the NHS Classifications Service at NHS Connecting for Health.

How will new codes be dealt with, added? When are the next planned release and
closure dates?
The enhanced OPCS-4 classification undergoes an annual review; however this
does not necessarily mean an annual update. Every year the NHS Classifications
Service reviews the submissions made via the requests portal and provides a
recommendation to the OPCS-4 Editorial Board to inform their decision on whether to
proceed with an update.
Submissions can be ongoing through the OPCS-4 Requests Portal.
Whilst this is now closed for consideration in OPCS-4.5 (deadline 3 March 2008)
submissions received after this date will be considered for future releases of the
classification. The advance notice DSCN for OPCS-4.5 for use in the NHS from April
2009 has already been published by ISB.
HRG4 groupers will validate all underlying data in a patient record. They are also
updated for any and all changes in the underlying coding classifications, such as the
enhancement to OPCS offered by OPCS-4.5.

Is it possible for coding guidance to be produced to specify what should be recorded
for each of outpatient and inpatient activity in terms of generating diagnostic imaging
unbundled HRGs?
Coding guidance already exists for assignment of codes to represent diagnostic
imaging, however further illustrative guidance will be issued by the NHS
Classifications Service for implementation in October 2008.
If in HRG4 the algorithm allows for unbundling in accepted circumstances in order for
specific services generate an unbundled HRG in addition to the core HRG the NHS
Classification Service will issue coding guidance through the standard mechanisms
already in place such as the Coding Clinic – see

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The national salaries for clinical coders do not support the DH PbR requirement of
gaining clinical engagement between clinicians and coders. There is a national
shortage of trained clinical coders and increasingly those who remain in the NHS
either leave the profession altogether or are poached by agencies paying more than
double their NHS salary. What is being done to address this?
Clinical coding underwent the same processes as all NHS staff as part of the Agenda
for Change Review. It is the responsibility of local organisations to incentivise staff to
maximise retention. This can be achieved in ways other than salary bandings and
the NHS CFH have heard examples which include the popularity of flexible working
and continuous professional development via career training as trainer or auditor.
Local roles and responsibilities for employees and local development plans inform
Agenda for Change bandings.

Coding accuracy – A recent coding audit of a large trust in greater Manchester
demonstrated that in some instances coding accuracy was about 70%. What is the
DH doing and what as a PCT can we do to improve this and also what is being done
to make sure the introduction of HRG4 doesn‟t make this percentage worse?
It is a local responsibility with each PCT and their Trust to work together to review the
points raised in the audit reports to implement necessary changes relevant to their
From 2009, a greater percentage of provider care activity can be grouped through
HRG4 and could be paid under PbR. This will increase the dependency on accurate
and complete coding, and this is in itself an incentive for providers to maintain and
improve the quality of coding. In addition, from 2008/9 the Audit Commission will be
conducting an annual review of coding quality and will be required to sign off the
quality of each Trust‟s data.

Why was NHS CFH not a contributor / participant in the roadshows, considering that
OPCS codes are material to derivation of HRGs?
The 2008 HRG4 roadshows were intended to communicate the strategic approach to
funding using HRG4 from April 2009, and offer an illustration of the benefits HRG4
can offer over HRG v3.5 in terms of supporting the funding mechanism under PbR.
The organisations presenting at this series of events were considered to be the key
stakeholders necessary for the successful implementation and understanding of
HRG4 with regard to funding. Therefore an illustration of coding to support Casemix
classifications, rather than coding practice, was deemed sufficient at this time.

DH, PbR and the National Tariff

There has been an excellent system of wide consultation. No one has mentioned
public debate on consultation. Has this taken place? If so, with whom? If not, is it
planned for the future?
The public consultation “Options for the future of Payment by Results: 2008/09 to
2010/11” was an open opportunity for comment on our proposals. The summary of
responses is available on the DH website at:
Following the consultation and before publishing the summary of responses, DH met
with umbrella organisations for detailed discussions on their comments to ensure
robust understanding of representative views.

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Is PbR intended to be cost neutral, just redistributing funding better targeted to
activity? What arrangements have been made/ discussed to support Trusts whose
income goes down because they do fewer complex procedures when they have been
used to providing services based on that funding?
Under PbR trusts are paid for the activity they undertake – there has been a long
transition phase, now coming to an end, to allow trusts to adjust to new income
levels. As part of the planning for HRG4, DH will assess the impact on NHS

What is the thinking about linking HRG4 to quality of treatment/ performance? Are we
concentrating on getting this right in terms of information/ data capture and finance/
tariffs and relying on patient choice to influence quality issues at present?
Lord Darzi‟s recently published NHS Next Stage Review Final Report makes mention
of the Commissioning for Quality and Innovation (CQUIN) Scheme. Exactly how this
will work in practice is still being developed but the broad principle is that a small
percentage of the value of a contract would be dependent on achieving certain
quality measures (clinical measures, patient experience, patient recorded outcome
measures (PROMs)) with the intention this would apply to all health sectors.
In 2009/10 this payment will be made to providers upon them submitting the
appropriate outcome data, whilst from 2010/11 payment will be made linked to the
actual outcomes delivered. Further details will be released by DH once finalised.

How do/can Trusts get involved in the Sense Checking process? If the Road Tester
Grouper is not updated until April 2008, what is the point, as changes cannot be
incorporated prior to agreement of contracts? But there must be road testing?
The sense checking exercise is to allow DH to check their calculations are correct
with discrete NHS organisations/groups.
The Road Testing exercise is the opportunity for Trusts to try out the proposed tariff
to assist with financial planning before the final tariff is issued.

Will there be a rationalisation of the organisation involved in the HRG/ PbR process.
Currently the organisations of DH/ IC/ CFH gives 6 different combinations where
communication can be garbled as for things to go wrong?
The PbR process is being driven by DH as a national government initiative. Both
NHS CFH and the NHS IC support the DH as suppliers delivering specific projects for
a client – in this instance with classifications and HRGs respectively. Although
independent organisations within the NHS family, there is collaboration at a variety of
levels to ensure consistent messages are delivered to the NHS. This includes at
strategic, planning and tactical levels. There are project boards, communications
group and meetings with key managers to ensure consistent approach across PbR
delivery. As the scale of the project is so vast there may be occasions where the
communications may appear conflicting and you are therefore advised to contact the
appropriate helpdesk for clarity.

Currently specialised services are funded at speciality level, how will this be
separated by HRG4 and DH funding if the work between dominant episode and tariff
that exists in HRG v3.5 is removed in HRG4?
The PbR team are currently running regression analysis on specialised services for
2009/10 based upon an HRG4 tariff. It is expected that the details for specialised
services in 2009/10 will be published in line with the road testing exercise for

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Will there still be a schedule of excluded drugs and devices with the 2009/2010 tariff?
If so how different will it look e.g. will the scope be extended or reduced?
We are still designing the scope and structure of the 2009/10 tariff so it is therefore
too early to confirm details. However, it is reasonable to assume that there is likely to
be some need for exclusion of certain drugs and devices from the national tariff.

Will the HRG4 tariff for 2009/10 include the cost of capital (capital charges)? The
Audit Commission have commented about the feasibility of removing capital charges
from the tariff
There are no plans to change the method of funding the cost of capital for the
2009/10 tariff.

Are Patient Transport Services likely to be a top-up or unbundled tariff or just part of
the HRG tariff with HRG4?
Patient Transport is likely to be taken out of the tariff for 09/10 and allow PCTs to
commission and pay local prices for these services.

When will the structure of tariff be firm? October 2008 is too late to ensure we focus
on ensuring the necessary elements are accurate.
What is the tariff publication date?
We aim to release the final tariff as soon as possible before the year to which it
applies to aid organisations with their planning and contracting commitments. The
tariff, which is released in October, will have been quality assured prior to publication
with a number of NHS stakeholders. Therefore, organisations do not need to build in
time to assess accuracy.

New births – There appears to be a conflict between „well baby check‟ and „neonatal
level of care check‟ which excludes unwell babies treated on the maternity ward. Well
babies are funded as part of the mother‟s delivery, whereas SCBU/NICU babies are
funded on a day rate (instance) basis. There is no provision to fund unwell babies on
the maternity ward. Can this anomaly be corrected in HRGv3.5? BHT has been trying
to get resolution on this current v3.5 process issue from PbR and SUS for 8 months
The identification of well babies – or more precisely babies that are not considered
unwell but have a neonatal care level of 0 – is a long standing issue. A revised
algorithm was adopted in SUS for 2007/08 reflecting discussion with users and
current practice between some providers and commissioners. A revision to this
algorithm is in place for 2008/09.

Under HRG4, will all newborns be included with well babies and therefore attract a
£0 tariff?
The identification of well babies – or more precisely babies that are not considered
unwell but have a neonatal care level of 0 – is a long standing issue. A revised
algorithm was adopted in SUS for 2007/08 reflecting discussion with users and
current practice between some providers and commissioners. A revision to this
algorithm is in place for 2008/09
Under HRG4 newborns will be covered by three HRG‟s – PB01Z Major Neonatal
Diagnoses, PB02Z Minor Neonatal Diagnoses and PB01Z Healthy Baby (formally
PA16Z in 2006/07). PB01Z will attract a zero tariff.

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How can there be a new set of tariffs on 09/10, new structures, new market forces
factor etc. but not a new baseline / rebasing exercise to scope the impact on a trust
by trust basis? 2006/07 core costs are considered to be no worse or better than
2005/06, but unbundled costs are not good quality. Surely this is illogical as any visits
inappropriately included or excluded from unbundled costs directly affect the core
The various changes affecting the national tariff in 2009/10 are being considered
within the impact analysis used within the PbR development process. It is a different
situation to when PbR was first introduced in terms of baselining as given that the
national tariff has been in operation for a number of years it is possible to model and
assess the impact of changes without the requirement for a national rebasing

Will the Darzi review affect the tariff directly?
The outcome of the Darzi review will not be known in time for it to affect the 2009/10
tariff in a substantive fashion. It may be possible to reflect some of the direction of
travel in accompanying guidance.

If the road test is not going to alter things „significantly‟ is it really a road test? And if it
is going to change things, will this not invalidate legal contracts?
The PbR road-testing exercise is a pre-release of the final tariff to support early
service and financial planning. In addition it has provided an opportunity for the NHS
to provide comments on the other elements of the PbR package, in particular
supporting guidance.

Have the 2006/07 reference costs been adjusted for any errors found in the HRG
I believe that HB21* „intermediate knee procedures‟ contained disproportionately high
numbers of H10 arthroscopies and H04 knee replacements. This was communicated
to DH and the IC but I never got a response
The code to group documentation on the IC website at http://www.ic.nhs.uk/our-
services/standards-and-classifications/casemix/hrg4/prepare-for-hrg4 provides
details of the mapping from OPCS / ICD codes to the HRG4 design as implemented
in the HRG4 2007/08 Reference Costs Grouper. Several changes have been made
to this HRG4 grouper product from that used for the 2006/07 Reference Costs
collection, these can be found at the above site within the “HRG4 Design Changes
(Jan 08) Section”.

Is the policy of specialist top-ups to continue?
Full details of how the national tariff will operate in 2009/10 will be published during
2008. This will include details of how specialised activity will be reimbursed.

How is HRG4 expected to operate? It may be „setting independent‟ but what about
„healthcare professional‟ independence?
The HRG4 grouper will generate HRG information based on valid data in the patient
record. The HRG4 grouper will not differentiate between identical patient care
provided by different healthcare professionals where the underlying coding in the
patient record is identical – i.e. it will generate the same HRG for the same patient
care, irrespective of the healthcare professional that undertakes that care.
In 2009/10 DH plans to include non consultant responsible activity in the outpatient
tariffs for the first time.

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How do you account for changes in activity, both real and „counting improvements‟
between 2006/07 ref costs and 2009/10 tariff?
The 2009/10 tariff will be based on 2006/7 Reference costs. However, the average
cost from Reference cost will not directly translate into the 2009/10 tariff for a given
HRG for a number of reasons. For example, the Market Forces Factor (MFF) is
included within Reference Costs, but is stripped out of the tariff as it is paid for
separately. Similarly, elements of the structure of the tariff will impact individual tariff
prices. Until the structure of the 2009/10 tariff this will not be finalised, but DH plan to
publish a step-by-step guide calculation to the tariff as in 2008/09.

Is the current proposal to rebundle critical care, rehab etc. i.e. everything except
diagnostic tests? What about NICU/PICU? Will these still be chargeable separately
on an OBD basis?
Critical care spells are unbundled from the admitted patient care spell. There is no
proposal to rebundle. The currency proposal for adult critical care is a payment for
each bed day based on the maximum number of organs supported during a spell,
and the currency proposal for PICU and NICU is a payment for each bed day based
on the level of care each day.
Detailed information on the currency proposals is available in the HRG4 area of the
Information Centre‟s website at

Will HRG4 address the area of zero length of stay non-elective inpatient activity to
generate a fairer tariff – an increasing area of activity given Medical Assessment
Units and 4 hour waits?
The HRG4 design is intended to improve the within-HRG resource similarity in
aggregating patient level data as compared to that evidence in HRG v3.5.
Any decision relating to funding adjustments for specific patient subsets lies firmly
within the remit of the DH PbR team
There are a number of options under consideration for zero length of stay. As you are
aware, PbR does not introduce any new money into the system, therefore, once
these options are fully evaluated a decision will be made.
When will official SUS flex and freeze be published for 2008/9? How will they differ
from previous years?
This guidance has been issued on the CFH website at the following URL and
specifically under the May 15 2008 bulletin:
This guidance is issued in support of the policy on reporting, billing and payment as
laid out the NHS operating framework for 2008/09 and the NHS standard contract for
acute services.

Is there any progress on the tariff for Pathology? Is this likely to be incorporated into
The Casemix Service are working with an Expert Working Group to consider
potential HRGs for Pathology. This development will be informed by the outcome of
Lord Carter's Review of NHS Pathology Services

Will any services currently priced at indicative tariffs move to mandatory tariffs from
01 April 2009?
Any new mandatory tariffs will be communicated as part of the autumn road test of
the 2009/10 tariff.

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MFF impact is significant – how robust is the process?
The data and methodology which underpins the MFF are robust. The data sources
for each component of the index - staff, land and buildings – are all external to the
Department and subject to formal validation processes.
The approach used to establish the staff index (the General Labour Market
approach) has been subject to several independent, academically led reviews and
has been shown to be the most appropriate methodology. To find out in more detail,
how the MFF is derived, then please consult the MFF Technical Guidance which is
available in the 2008/09 Tariff Guidance section of the PbR website:

Please clarify age of transition for child to adult. We work to 16 years 364 days =
child, 17 years and over = adult. I heard the age 18 years and under twice at this
For reference costs, an adult is over 18 and a child is up to and including 18. This is
to ensure consistency with HRG4.

Throughout the day we‟ve heard how important data quality and accurate coding are.
However, this is contradicted/more problematic if we are forced to submit coded data
to tight flex and freeze deadlines. How can these be reconciled?
This issue is recognised and therefore there are opportunities for providers, in
agreement with commissioners, to move towards monthly reporting in 2008/09.
However it is expected that all providers will be adopting the monthly reporting cycle
in the latter part of 2008/09, in particular to support the wider objective for faster
closing of accounts.

NHS Costing and Reference Costs

With the increased emphasis on reference cost quality of information and patient
level costing, how will this work alongside organisations‟ needs to implement service
line reporting?
Improved costing of activity is key for an organisation to manage their own business.
Patient Level Costing helps organisations to understand their costs and activity better
and will help facilitate service line reporting as costs are aggregated up to service

Guidance around radiology data collection under HRG4 was poor in 2006/7. In
addition, Trusts found it particularly challenging to map local systems (CRIS) to
OPCS and therefore to HRG4.
The department had previously mentioned its intention to release a mapping of local
codes to OPCS / HRG4. Is this something that will be released for the 2007/8
collection, otherwise trusts will struggle to submit any sensible data in this area?
It is the intention of DH PbR to provide additional guidance to support the unbundling
of diagnostic imaging. In particular a suggested mapping is being prepared which will
link Korner bands to OPCS codes. This is expected to be published as part of the
FAQ‟s relating to the 2007/08 Reference Costs collection during the first half of 2008.

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It would be useful to learn more about patient level costing – what it is and what is
being done nationally and locally to implement this. Also, it would have been useful to
discuss the links with service line reporting, something which all Foundation Trusts
are now expected to implement and one of the main pieces of work for costing
departments (in many respects it has overtaken Reference Costs in importance)
You can find out more about Patient Level Information and Costings Systems
(PLICS) at the DH website
This area of the website is currently being expanded and improved. PLICS is not
mandated for NHS organisations, however organisations are encouraged to
implement PLICS in order for them to fully understand and improve their business,
engage with clinicians and benchmark effectively. By implementing a PLICS system,
it enables organisations to produce data aggregated up in different ways, for example
to support SLR.

Will patient level information be collected nationally and used to check iso-resource
HRGs and assess the need for additional HRGs / splits?
Currently cost data is collected nationally at the average HRG level through the
Reference cost process. A planned voluntary collection of the patient level data, used
to complete the 2007/08 Reference Costs, is planned for post September 2008,
details are still to be finalised, however if you would like to participate in this
collection, please contact Suzanne.ibbotson@dh.gsi.gov.uk.

2006/07 reference costs required a greater level of medical coding which was not
identified by coding guidance / standing instructions. What has been done in 2007/08
to ensure that medical coding provides the detail required for 2007/08 reference
Clinical data, as captured in the patient hospital record, is recorded by clinical coders
to the greatest level of detail provided by the clinician at point of care. Extensive
guidance and instructions on the assignment of the appropriate clinical codes exists
and is updated to satisfy NHS requirements as necessary that extends beyond PbR
and HRGs. For further guidance contact the national clinical classifications helpdesk
datastandards@nhs.net or telephone 01392 206248.

Therapy and nursing activity – The current definition of non face to face activity which
can actually be counted against unit costs for reference costs gives the above a
problem. Non face to face activity about the patient is currently classed as
overheads. As an example, Occupational Therapists and Speech and language
therapists do a tremendous amount of liaison on behalf of their patients over the
phone etc. Without this liaison, patients would not receive key elements of their care.
This activity should therefore be counted against unit costs for reference costs as
well as non face to face activity with the patient / proxy. If we are to get clinicians on
board with this process we must address this so that key elements of care are
acknowledged. Please come and visit our practitioners at Swindon PCT to discuss
Non face to face activity that is not with the patient (or a proxy for the patient) should
not be separately identified /reported as non face to face activity /costs within the
reference cost submission. A non face to face contact should replace the need for
an outpatient face to face attendance.
Telephone contacts solely to inform patients of results are excluded.
Contacts about the patient, either face to face or non-face to face, cannot be counted
as valid activity in any service reported in Reference Costs.
The costs for the liaison activity described needs to be allocated to the relevant face
to face/ non face to face attendance cost pool. The development of the non face to
face definition/collection is in order to support the development of a national tariff. It

Page 19 of 21
would be interesting to know how the liaison activity described above could be
defined and how this could be recorded, consistently, on a national basis.

GPs with special interests performing minor surgical / other procedures / OP
attendances – should these be classed as consultant led or non-consultant led?
Assuming the GP is either employed by the PCT or charging you when acting in their
capacity as part of the NHS, the way in which this activity is recorded is dependant
upon what data is input in the patient record (the fields in the Commissioning Data
Please refer to paragraph 100 of the final reference costs guidance for clarification on
the required data element, main specialty and treatment function code to define
whether such activity is Consultant-Led or non Consultant-Led.

Please clarify consultant led versus non-consultant led. Consultant led is better
defined in the NHS Data Dictionary than in the PbR technical guidance. PbR
technical guidance is not as specific so providers can interpret a nurse led event as
being under the responsibility of a consultant, even though the patient is not seen by
a doctor. The costs for a nurse led event will be lower. This needs better guidance
The Data Dictionary definitions detailed below have been agreed with PbR.
Consultant Led Service
A Consultant Led Service is a SERVICE where a CONSULTANT retains overall
clinical responsibility for the SERVICE, CARE PROFESSIONAL TEAM or treatment.
The CONSULTANT will not necessarily be physically present for each Consultant
Led Activity but the CONSULTANT takes clinical responsibility for each PATIENT's
Consultant Led Activity
A Consultant Led Activity is an ACTIVITY where a CONSULTANT retains overall
clinical responsibility. The CONSULTANT is not necessarily physically present for
each PATIENT's appointment, but he/she takes overall clinical responsibility for
The MAIN SPECIALTY of the CONSULTANT retaining overall clinical responsibility
is recorded using the appropriate MAIN SPECIALTY CODE along with their
the ACTIVITY is delivered in a TREATMENT FUNCTION.
The MAIN SPECIALTY CODE is used by the Secondary Uses Service to identify
Consultant Led Activity.
With regard to PbR technical guidance, your comments will be taken into
consideration when DH update the reference cost and tariff guidance.

Reference costs and programme budgeting – Having unbundled various activities for
the 2006/07 cost exercise, the costs then had to be rebundled for programme
budgeting. Will this still be the case for 2007/08 or will there be some liaison and
agreement about how the costing needs to be completed?
The Reference Cost submission will continue to separately identify unbundled activity
and costs.
Please refer to the 2007-08 Programme Budgeting Guidance, which gives details of
the mapping process for Unbundled HRGs.

HRG v3.5

Could spell converter functionality be incorporated into HRGv3.5?
HRG v3.5 groups at FCE level and uses the dominant FCE within a spell to derive
the spell HRG. As the 2008/09 financial year is the last anticipated year of use of
HRG v3.5 for reimbursement under PbR, there are no plans to develop the HRGv3.5
grouper to incorporate spell conversion.

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And finally…

Are the roadshow presentations accessible via the IC website?
These are now available:

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