Z59 housing codes
CC to NonCC
- Homelessness, inadequate housing and housing instability codes changed as proposed [1]
- Keep capturing for care planning; re-check whether the code still changes the DRG before you query
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The CMI · Issue 4 · November 2026
FY2027 MS-DRG shifts: the CDI queue to build before Q1
Short answer: Version 44 brought 768 MS-DRGs, new groups for spinal fusion, pacemaker revision, joint revision and gynecologic oncology, and revised severity designations. CMI moves on those changes, not on the 2.3 percent rate. Here is the query queue, in order.
CMS-1849-F · Aug 4, 2026Oct 1, 2026 · dischargesE40 to E43 stay MCCsZ59 codes CC to NonCC
Edition
Issue 4 · Nov 2026
Focus
FY2027 MS-DRGs
Audience
CDI · HIM · CFO
Codes
768 MS-DRGs · V44
Effective date
Oct 1, 2026
Length
5 min read
768MS-DRGs
For FY2027 under Version 44, per the final rule [1]
+2.3%operating update
FY2027 IPPS update for hospitals meeting reporting requirements: 3.2% market basket less 0.9 points [2]
Oct 1, 2026effective
For discharges under the FY2027 rule [1]
$779Mnew tech
CMS estimate of FY2027 new technology add-on payments [2]
The MS-DRG structural changes that move CMI
MS-DRGs 210, 211 and 449 also join the replaced-devices-without-cost-or-credit policy [1].
| Area | Deleted | Created | CDI consequence |
|---|---|---|---|
| Cardiac pacemaker revision or device replacement | MS-DRGs 258 to 262 | MS-DRG 210 with MCC; 211 without MCC | Two-way split; only MCC capture moves the case |
| Other circulatory system O.R. procedures | Base MS-DRG 264 | MS-DRG 361 with MCC; 362 without MCC | Same two-way logic |
| Revision of hip or knee prosthesis | MS-DRGs 466 to 468 | MS-DRG 449 (title revised) | Three severity levels collapse to one group |
| Periprosthetic joint infection | Logic reassigned | MS-DRGs 403 (with MCC or antibiotic-eluting bone void filler) and 404 | Infection must be the documented principal diagnosis |
| Extensive or complex spinal fusion except cervical | Cases from 426 to 428, 456 to 458 and the custom device groups | MS-DRGs 523 with MCC, 524 with CC, 525 without CC/MCC | Levels fused and device detail decide the group |
| Uterine and adnexa procedures for malignancy | MS-DRGs 736 to 741 | MS-DRG 731 with MCC and companion groups | Malignancy as principal diagnosis drives the group |
Severity designations changed, and so did the value of a query
E40 to E43
Remain MCCs
- Severe protein-calorie malnutrition keeps its query value [1]
- Documentation must meet clinical criteria
New FY2027 codes
Table 6A
- Assigned individually; load the new codes and designations into the encoder and query templates [1]
The FY2027 CDI query queue, in priority order
Open queries are one of the five root causes of DNFB; the 13-week DNFB compression method covers the whole hold.
MCC capture on pacemaker and circulatory O.R. cases
210/211, 361/362
Two-way splits; query for the MCC-level condition when the record supports it.
Spinal fusion levels and devices
523 to 525
Confirm levels, approach and device in the operative note.
Periprosthetic joint infection as principal diagnosis
403 and 404
Infection documented as principal; filler coded when used.
Revision arthroplasty
449
One severity level; shift effort from CC hunting to device and complication accuracy.
Malnutrition documentation
E40 to E43
Queries must cite clinical indicators and the dietitian assessment.
Social determinant codes
Z59
Keep capturing for care planning; queue as DRG queries only where Version 44 still shows a change.
| Element | Standard |
|---|---|
| Trigger | Regroup report flags cases where a documented condition would change the Version 44 group or severity level |
| Owner | CDI specialist by service line; coding lead for post-discharge queries |
| Turnaround | Concurrent queries before discharge; retrospective within 48 hours |
| Measure | Query rate, agreement rate, CMI by service line, DNFB days attributable to open queries |
FY2027 IPPS update, in points
How the 2.3 percent is built
Worth about $2.1 billion [2].
Market basket
+3.2%
Productivity adjustment
-0.9 points
Net operating updatehospitals meeting reporting requirements
+2.3%about $2.1B
0123%
Market basketProductivityNet update
Takeaway
Regroup your last twelve months of discharges under Version 44 and compare CMI by service line to Version 43. The lines that fall are where the query queue goes first.
Run a Version 44 regroup on July to September discharges and read three columns
Column 1Cases whose MS-DRG changed between Version 43 and Version 44.
Column 2Cases whose severity level changed on the same documentation.
Column 3CMI delta by attending and by service line.
OutputA named list of physicians and query templates for November education; retire templates that change neither the MS-DRG, the severity level nor a quality measure. See autonomous inpatient coding and hospital coding services.
Frequently asked questions
How many MS-DRGs are there for FY2027?
The final rule states there will be 768 MS-DRG groupings under Version 44, effective for discharges on and after October 1, 2026.
What are the new spinal fusion MS-DRGs?
MS-DRGs 523, 524 and 525, Extensive or Complex Spinal Fusion Procedures Except Cervical with MCC, with CC, and without CC/MCC, built from cases reassigned out of MS-DRGs 426 to 428, 456 to 458 and the custom interbody device groups.
Did CMS change the severity level of the malnutrition codes?
No. CMS kept E40 to E43 as MCCs for FY2027; the designations it did change include the Z59 homelessness, inadequate housing and housing instability codes, from CC to NonCC.
- Federal Register: FY 2027 IPPS and LTCH PPS final rule (CMS-1849-F), August 4, 2026
- CMS fact sheet: FY 2027 Hospital IPPS and LTCH PPS Final Rule (CMS-1849-F), July 31, 2026
- Federal Register: FY 2027 IPPS and LTCH PPS proposed rule (CMS-1848-P), April 14, 2026
Worth about $2.1 billion [2].
Want a Version 44 regroup on your own discharges?
Send us a quarter of inpatient claims and we return the MS-DRG and severity shifts by service line and attending, with the query queue ranked by CMI effect.