What does the term "RUG creep" refer to in medical billing?

The term "RUG creep" refers specifically to a form of upcoding related to patient assessments. It is derived from the Resource Utilization Groups (RUG) classification system used for determining Medicare reimbursement rates for skilled nursing facilities. When healthcare providers or facilities engage in RUG creep, they may inappropriately increase the reimbursement levels by misclassifying the complexity or care needs of a patient, often through exaggerated assessments of their condition or the services provided. This practice can lead to higher payments from insurance, particularly Medicare, resulting in significant financial implications for both the providers and the healthcare system as a whole. Recognizing and addressing RUG creep is crucial for maintaining compliance with billing regulations and ensuring that healthcare reimbursements accurately reflect the services provided.