Defining Case Mix Index
Case Mix Index (CMI) is the average relative weight of all DRGs for a given facility, payer, or time period. It serves as a proxy for the overall clinical complexity and resource intensity of the patient population treated, and it directly influences Medicare inpatient reimbursement levels.
Calculating CMI
CMI is calculated by summing the relative weights of all discharges within the period and dividing by the total number of discharges. A rising CMI generally indicates a sicker patient population, more complete documentation and coding of severity, or both, and it is important to distinguish between these causes.
Factors That Influence CMI
- Actual changes in patient acuity or service line mix (for example, adding a transplant program)
- Improved documentation and coding accuracy through CDI initiatives
- Coding errors, either under-coding that suppresses CMI or improper upcoding that inflates it
- Shifts in payer mix that change which discharges are included in the calculation
Monitoring CMI Appropriately
- Track CMI trends over time alongside CC/MCC capture rates to understand drivers of change
- Compare CMI changes against service line volume data to rule out simple case mix shifts
- Audit a sample of records following a CMI increase to confirm coding accuracy supports the change
- Report CMI trends to leadership with context, not as an isolated number
Compliance Considerations
A sudden, unexplained increase in CMI without a corresponding clinical or programmatic change can attract auditor attention as a potential indicator of improper coding practices. HIM directors should be prepared to explain CMI trends with supporting documentation and audit evidence.
CMI and Financial Planning
Because CMI directly affects the base payment rate multiplier for Medicare discharges, finance departments rely on HIM-reported CMI data for budgeting and forecasting. Inaccurate CMI reporting can distort revenue projections significantly.
Exam Tip
Be able to calculate CMI from a list of DRG relative weights and discharges, and explain the difference between a legitimate CMI increase and one driven by coding errors.