Overview
The Present on Admission (POA) indicator is a single-character code appended to each diagnosis code on inpatient institutional UB-04 claims identifying whether the condition was present at the time of admission to the hospital. CMS introduced POA reporting for inpatient Medicare claims in 2008 as part of the Hospital-Acquired Condition (HAC) Payment Reduction Program. POA reporting now applies broadly across payers for inpatient claims.
Valid POA indicators are: Y (Yes, present on admission), N (No, not present on admission — developed during the stay), U (Documentation insufficient to determine), W (Clinically undetermined), and 1 (Exempt from POA reporting — applies to specific diagnosis codes where POA is not clinically meaningful). Each reported diagnosis must have an assigned POA indicator; missing indicators trigger claim rejection.
Reimbursement impact flows through the HAC Payment Reduction Program. Certain hospital-acquired conditions — pressure ulcers stages 3 and 4, falls and trauma, catheter-associated UTI, vascular catheter-associated infection, surgical site infections after certain procedures, and others — are excluded from MS-DRG assignment when they are the only complicating condition (CC) or major complicating condition (MCC). When a HAC is flagged as not-present-on-admission (POA = N), the MS-DRG may shift to a lower-paying severity level.
Clinical documentation improvement (CDI) programs heavily monitor POA assignment because of its DRG impact. A condition that was present at admission but documented without explicit present-on-admission statement may default to U or W, triggering the same DRG penalty as N. CDI specialists query providers to clarify POA status when documentation is ambiguous. Accurate POA assignment requires both physician documentation of admission-time clinical status and coder application of correct POA indicators.
Quality reporting and public reporting uses include CMS Hospital Compare and the CMS Hospital-Acquired Condition Reduction Program (HACRP), which ranks hospitals on HAC rates and penalizes the lowest-performing quartile with a 1% Medicare payment reduction. Accurate POA assignment is critical both for DRG reimbursement on individual claims and for the aggregate HAC performance measures.
For RCM operations, POA management requires coordination between HIM/coding, CDI, utilization management, and compliance. POA-related denials and DRG adjustments are common; audit programs frequently focus on POA assignment accuracy. Practices typically conduct periodic POA audit of inpatient coding, particularly for conditions commonly associated with HAC reporting, to validate coding accuracy and identify documentation gaps.
Denial and audit patterns related to POA include DRG downgrades when a HAC was documented as POA = N but clinical evidence supports admission-time presence, Recovery Audit Contractor (RAC) findings for POA assignment errors, and CDI query outcomes that drive POA reassignment during concurrent review. Electronic health record order sets and problem list workflows that capture admission-time clinical findings facilitate accurate POA assignment; fragmented documentation that makes admission-time status unclear is a common root cause of POA errors.
Industry benchmark
POA reporting: mandatory for inpatient Medicare claims since 2008. HAC payment reduction: applies when HAC is not POA. HAC Reduction Program penalty: 1% Medicare payment reduction for lowest-performing hospital quartile.
Worked example
A Medicare patient is admitted for pneumonia and develops a stage 3 pressure ulcer during the 10-day stay. The UB-04 reports the pneumonia diagnosis with POA = Y (present on admission) and the pressure ulcer diagnosis with POA = N (developed during stay). The not-POA pressure ulcer triggers HAC exclusion from DRG severity upgrade; the MS-DRG assignment is based on pneumonia alone rather than being upgraded to a higher-severity MS-DRG that would include the pressure ulcer complication.
POA-exempt codes FY2027: the list and what changed
The FY2027 ICD-10-CM POA-exempt file lists 38,399 codes for which no present-on-admission indicator is reported. The FY2027 Official Guidelines for Coding and Reporting (Appendix I) give four reporting options for every other diagnosis on an inpatient claim, Y, N, U and W, and say to leave the field blank only when the code is on the exempt list. Exempt codes describe circumstances of the encounter, factors influencing health status or conditions that are always present on admission, which is why 28,930 of them are injury and poisoning codes for subsequent encounters and sequelae and 6,591 are external cause codes.
For FY2027 CMS added 62 codes to the list and removed 12, and revised the title of 1. 5,664 codes on the CC/MCC list are POA-exempt, so the hospital-acquired condition logic never applies to them. To see whether a given code needs an indicator, run it through the CC/MCC and POA lookup.
| Chapter | Exempt codes |
|---|---|
| 1. Certain infectious and parasitic diseases | 12 |
| 4. Endocrine, nutritional and metabolic diseases | 6 |
| 9. Diseases of the circulatory system | 233 |
| 13. Diseases of the musculoskeletal system and connective tissue | 344 |
| 15. Pregnancy, childbirth and the puerperium | 67 |
| 16. Certain conditions originating in the perinatal period | 24 |
| 17. Congenital malformations, deformations, chromosomal abnormalities, and genetic disorders | 900 |
| 19. Injury, poisoning and certain other consequences of external causes | 28,930 |
| 20. External causes of morbidity | 6,591 |
| 21. Factors influencing health status and contact with health services | 1,292 |
The additions are subsequent-encounter and sequela codes for toxic effects of solvents and other substances, contact and exposure codes such as burn pits and Agent Orange, personal history codes, the adult BMI codes Z68.18 and Z68.19, and inherited conditions such as Loeys-Dietz syndrome and the QA1 familial cancer syndromes.
| ICD-10-CM | Description |
|---|---|
| Q87.A | Loeys-Dietz syndrome |
| QA1.71 | Lynch syndrome |
| QA1.790 | Familial cancer syndrome with pathogenic BRCA1 mutation |
| QA1.791 | Familial cancer syndrome with pathogenic BRCA2 mutation |
| QA1.792 | Li Fraumeni syndrome |
| QA1.798 | Other inherited neoplasm predisposition syndrome of multiple systems |
| T52.811D | Toxic effect of alkenes, accidental (unintentional), subsequent encounter |
| T52.811S | Toxic effect of alkenes, accidental (unintentional), sequela |
| T52.812D | Toxic effect of alkenes, intentional self-harm, subsequent encounter |
| T52.812S | Toxic effect of alkenes, intentional self-harm, sequela |
| T52.813D | Toxic effect of alkenes, assault, subsequent encounter |
| T52.813S | Toxic effect of alkenes, assault, sequela |
| T52.814D | Toxic effect of alkenes, undetermined, subsequent encounter |
| T52.814S | Toxic effect of alkenes, undetermined, sequela |
| T52.821D | Toxic effect of cycloparaffins, accidental (unintentional), subsequent encounter |
| T52.821S | Toxic effect of cycloparaffins, accidental (unintentional), sequela |
| T52.822D | Toxic effect of cycloparaffins, intentional self-harm, subsequent encounter |
| T52.822S | Toxic effect of cycloparaffins, intentional self-harm, sequela |
| T52.823D | Toxic effect of cycloparaffins, assault, subsequent encounter |
| T52.823S | Toxic effect of cycloparaffins, assault, sequela |
| T52.824D | Toxic effect of cycloparaffins, undetermined, subsequent encounter |
| T52.824S | Toxic effect of cycloparaffins, undetermined, sequela |
| T52.891D | Toxic effect of other organic solvents, accidental (unintentional), subsequent encounter |
| T52.891S | Toxic effect of other organic solvents, accidental (unintentional), sequela |
| T52.892D | Toxic effect of other organic solvents, intentional self-harm, subsequent encounter |
| T52.892S | Toxic effect of other organic solvents, intentional self-harm, sequela |
| T52.893D | Toxic effect of other organic solvents, assault, subsequent encounter |
| T52.893S | Toxic effect of other organic solvents, assault, sequela |
| T52.894D | Toxic effect of other organic solvents, undetermined, subsequent encounter |
| T52.894S | Toxic effect of other organic solvents, undetermined, sequela |
| T59.821D | Toxic effect of hexamethylene diisocyanate, accidental (unintentional), subsequent encounter |
| T59.821S | Toxic effect of hexamethylene diisocyanate, accidental (unintentional), sequela |
| T59.822D | Toxic effect of hexamethylene diisocyanate, intentional self-harm, subsequent encounter |
| T59.822S | Toxic effect of hexamethylene diisocyanate, intentional self-harm, sequela |
| T59.823D | Toxic effect of hexamethylene diisocyanate, assault, subsequent encounter |
| T59.823S | Toxic effect of hexamethylene diisocyanate, assault, sequela |
| T59.824D | Toxic effect of hexamethylene diisocyanate, undetermined, subsequent encounter |
| T59.824S | Toxic effect of hexamethylene diisocyanate, undetermined, sequela |
| T65.851D | Toxic effect of medetomidine, accidental (unintentional), subsequent encounter |
| T65.851S | Toxic effect of medetomidine, accidental (unintentional), sequela |
| T65.852D | Toxic effect of medetomidine, intentional self-harm, subsequent encounter |
| T65.852S | Toxic effect of medetomidine, intentional self-harm, sequela |
| T65.853D | Toxic effect of medetomidine, assault, subsequent encounter |
| T65.853S | Toxic effect of medetomidine, assault, sequela |
| T65.854D | Toxic effect of medetomidine, undetermined, subsequent encounter |
| T65.854S | Toxic effect of medetomidine, undetermined, sequela |
| Z68.18 | Body mass index [BMI] 18.4 or less, adult |
| Z68.19 | Body mass index [BMI] 18.5-19.9, adult |
| Z77.013 | Contact with and (suspected) exposure to gadolinium |
| Z77.32 | Contact with and (suspected) exposure to burn pits in war theater |
| Z77.33 | Contact with and (suspected) exposure to Agent Orange |
| Z77.40 | Contact with and (suspected) exposure to unspecified blast overpressure |
| Z77.41 | Contact with and (suspected) exposure to low-level blast overpressure |
| Z77.42 | Contact with and (suspected) exposure to high-level blast overpressure |
| Z77.49 | Contact with and (suspected) exposure to other blast overpressure |
| Z86.17 | Personal history of Clostridioides difficile infection |
| Z87.8901 | Personal history of social gender transition |
| Z87.8902 | Personal history of medical gender transition |
| Z87.8903 | Personal history of surgical gender transition |
| Z87.8904 | Personal history of intersex surgery |
| Z87.8909 | Personal history of unspecified gender transition |
| Z87.893 | Personal history of gender detransition |
| ICD-10-CM | Description |
|---|---|
| S23.420D | Sprain of sternoclavicular (joint) (ligament), subsequent encounter |
| S23.420S | Sprain of sternoclavicular (joint) (ligament), sequela |
| T52.8X1D | Toxic effect of other organic solvents, accidental (unintentional), subsequent encounter |
| T52.8X1S | Toxic effect of other organic solvents, accidental (unintentional), sequela |
| T52.8X2D | Toxic effect of other organic solvents, intentional self-harm, subsequent encounter |
| T52.8X2S | Toxic effect of other organic solvents, intentional self-harm, sequela |
| T52.8X3D | Toxic effect of other organic solvents, assault, subsequent encounter |
| T52.8X3S | Toxic effect of other organic solvents, assault, sequela |
| T52.8X4D | Toxic effect of other organic solvents, undetermined, subsequent encounter |
| T52.8X4S | Toxic effect of other organic solvents, undetermined, sequela |
| Z68.1 | Body mass index [BMI] 19.9 or less, adult |
| Z87.890 | Personal history of sex reassignment |
Sources: ICD-10-CM FY2027 POA-exempt codes (full list, additions, deletions and revisions) (FY2027, effective 2026-10-01); ICD-10-CM Official Guidelines for Coding and Reporting FY2027 (Appendix I: present on admission reporting) (FY2027, effective 2026-10-01); MS-DRG grouper with Medicare Code Editor (MSGMCE) v44 installation and user's manual (HAC and POA logic) (v44.0, effective 2026-10-01).
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Frequently asked questions — Present on Admission (POA Indicator)
What are the valid POA indicators?
Y (Yes present), N (No not present), U (Documentation insufficient), W (Clinically undetermined), 1 (Exempt). Each diagnosis requires an indicator.
How does POA affect reimbursement?
Under IPPS and the HAC Payment Reduction Program, specific hospital-acquired conditions flagged as POA = N are excluded from DRG severity upgrade. The MS-DRG may shift to a lower-paying level, reducing reimbursement.
Who assigns POA indicators?
Coders assign POA based on physician documentation. CDI specialists query providers when documentation is ambiguous. Accurate POA requires both physician documentation of admission-time status and correct coder assignment.
Disclaimer
This glossary entry is operational reference for revenue-cycle and medical-billing professionals. It is not legal, clinical, or contractual advice. Industry benchmarks cite named public sources where available; always verify against the current guidance from the authority body before relying on a number in a contract, policy, or compliance filing.