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Tag Archives: 2midnight

Healthcare News: CMS invites comments on 2-midnight rule payment calculation

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A recent court ruling determined that CMS had to explain its calculation for a negative 0.2% reduction in inpatient payment rates as a result of implementing the 2-midnight rule. The court also said that providers should have an opportunity to comment on the calculation. 
 
In early December, CMS released a notice with comment period to meet the court’s requirement, but providers might not be pleased with forcing the agency’s hand. CMS notes that when originally estimating the number of outpatient cases that should shift to inpatient as a result of the rule, it looked at 2011 claims containing HCPCS codes G0378 (hospital observation service, per hour) and G0379 (direct admission of patient for hospital observation care). 
 
Using this data, CMS identified approximately 350,000 observation stays that lasted two or more midnights. The agency combined that with approximately 50,000 claims that contained major procedures based on APCs that resulted in stays lasting more than two midnights. CMS also analyzed data from the inpatient side by looking at inpatient claims containing surgical MS-DRGs with stays that lasted less than two midnights and found approximately 360,000. 
 
The agency used this data to determine a net increase of 40,000 inpatient discharges as a result of the rule to calculate $ 220 million in increased expenditures on the inpatient side, leading to the reduction.
However, CMS now says that in light of new regulations and by using different metrics to estimate the shift, as many as 570,000 cases could move to the inpatient side, resulting in an even larger payment shift. 
 
Providers can comment on the notice at regulations.gov and all submissions must be received by February 2, 2016. 

 

 

HCPro.com – JustCoding News: Inpatient

Pay-per-view: CMS shifts 2-midnight rule responsibility to QIOs, finalizes packaging expansion

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CMS finalized its proposals regarding the 2-midnight rule, including moving responsibility for rule enforcement and education from Recovery Auditors to Quality Improvement Organizations (QIO). This latter change occurred October 1, 2015.

For stays in which the physician expects the patient will need less than two midnights of hospital care, inpatient admission may be allowed on a case-by-case basis determined by the judgment of the admitting physician. The documentation must support the admission and will be subject to review by a QIO. CMS expects inpatient admission for minor surgical procedures to be unlikely and will prioritize those cases for medical review. For hospital stays expected to last two midnights or longer, CMS policy remains unchanged.
 
Continue reading "CMS shifts 2-midnight rule responsibility to QIOs, finalizes packaging expansion" on HCPro’s website. Subscribers to Briefings on APCs have free access to this article in the January issue. 

HCPro.com – APCs Insider

CMS proposes rolling back 2-midnight rule

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CMS proposes rolling back 2-midnight rule

The controversial 2-midnight rule may be no more following CMS’ release of its latest proposed rule for the hospital inpatient prospective payment system (IPPS). When it was first put in place for fiscal year 2014, the 2-midnight rule established a benchmark for inpatient admissions where a Medicare Part A payment would be considered reasonable and necessary for patient stays that lasted at least two midnights. Stays that didn’t reach that benchmark would be billed as outpatient services, which are covered by Medicare Part B and tend to result in lower hospital reimbursements.

Under the new proposed rule, CMS would no longer impose a 0.2% payment cut for inpatient stays under the 2-midnight rule. Hospitals would also receive a one-time 0.6% payment in fiscal year 2017 to offset the reduction in inpatient payments over the previous three years.

In the proposed rule, CMS wrote, "We still believe the assumptions underlying the 0.2[%] reduction to the rates put in place beginning in FY 2014 were reasonable at the time we made them in 2013. Nevertheless … in the context of this case, we believe it would be appropriate to use our authority … to prospectively remove, beginning in FY 2017, the 0.2[%] reduction to the rates put in place beginning in FY 2014."

The proposed rule, which would affect about 3,330 acute care hospitals and 430 long-term care hospitals, would apply to patient discharges from October 1, 2016 and later.

Under the proposed rule, acute care hospitals that are meaningful use electronic health record (EHR) users and that successfully participate in the Hospital Inpatient Quality Reporting Program would receive a 0.9% payment increase.

Overall, CMS estimates that the elimination of the payment cut and proposed payment increases will result in an additional $ 539 million in payments in fiscal year 2017.

CMS held a comment period for the proposed rule, which ended in June. A final rule will be issued August 1.

The proposed rule comes as welcome news to some. Following the announcement of the proposed rule, the American Hospital Association (AHA) released a statement from President and CEO Rick Pollack that said, "[The] rule includes a very important outcome because it reverses the inappropriate and unfair 0.2[%] payment reduction for inpatient services that was implemented as part of the original ‘two-midnight’ policy. The AHA successfully challenged [CMS’] interpretation through the courts to convince them to restore the resources that hospitals are lawfully due."

 

Background

Two years ago, CMS enacted the payment cuts for inpatient stays to offset an anticipated increase in inpatient admissions as a result of the 2014 IPPS 2-midnight rule. The increase in admissions was predicted to cost $ 220 million.

Following the rule’s introduction, there was vocal opposition to the rule from hospitals that argued it arbitrarily complicated care for Medicare beneficiaries, and legal challenges were subsequently launched over the 0.2% cut.

In the case Shands Jacksonville Medical Center v. Burwell, several hospitals and hospital associations, including the AHA, questioned whether Sylvia Burwell, secretary of the Department of Health and Human Services (HHS), had the authority to make the proposed across-the-board reductions, and whether her prediction of the $ 220 million increase was valid.

In September, the U.S. District Court for the District of Columbia found that HHS did have the authority to reduce the reimbursement rates, but that the justification for the 0.2% cut was lacking.

In his ruling, District Judge Randolph Moss wrote, "The Court is unable to evaluate whether the [s]ecretary’s decision was reasonable because her omission prevented the public from offering meaningful comments. The [p]laintiffs never had the opportunity to explain where, in their view, she went wrong, and, thus, the [s]ecretary never had to provide a reasoned justification of her position."

Moss ordered Burwell to provide additional justification for the reimbursement cut and allow a public comment period. CMS issued a request for comments in December.

The following month, 55 additional hospitals filed a similar lawsuit over the 2-midnight rule’s 0.2% inpatient payment cut and the estimated increase in inpatient admissions the cut was based on.

 

CMS pauses reviews of short-stay claims

On a related note, in May, CMS put a temporary pause on reviews performed by Beneficiary and Family Centered Care Quality Improvement Organizations (BFCC-QIO) to determine if payments under Medicare Part A are appropriate for claims for inpatient stays that span less than two midnights.

In a message posted June 6, CMS explained it "became aware of inconsistencies in the BFCC-QIOs’ application of the two-midnight policy for short hospital stay reviews, and … we temporarily paused short stay patient status reviews to give us time to improve standardization in the BFCC-QIOs’ review process."

BFCC-QIOs will use the temporary pause to complete retraining on the two-midnight policy and to review all claims that were denied since last October. BFCC-QIOs began conducting the short-stay claim reviews in October, which were previously conducted by Medicare Administrative Contractors.

CMS believes audit activities will resume in 60?90 days, according to the update it posted in June. In the meantime, hospitals that previously had a claim denied should check with their BFCC-QIO to see if the claim has been denied before filing an appeal. Hospitals that have already filed appeals will have the findings of the re-review performed by the BFCC-QIO shared with the appeals adjudicators.

HCPro.com – Credentialing and Peer Review Legal Insider

Is the 2-midnight rule going away and when will short-stay audits resume?

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Is the 2-midnight rule going away and when will short-stay audits resume?

Learning objective

At the completion of this educational activity, the learner will be able to:

  • Identify updates to CMS’ 2-midnight rule and best practices for compliance.

 

Every couple months, it seems questions arise about the 2-midnight rule and there are rumors that it may be going away. Below are some questions with answers from our expert Ronald Hirsch, MD, FACP, CHCQM, vice president of the Regulations and Education Group at Accretive Health in Chicago, to clarify where things stand today with regard to the 2-midnight rule.

 

Q: I heard the 2-midnight rule is now gone based on changes to Medicare payment rates under the 2017 inpatient prospective payment system (IPPS) final rule. Is this true, and if not, what changed?

 

A: No, this is not the case. The 2-midnight rule is still alive and kicking. What the FY 2017 IPPS final rule did is finalize two adjustments in addition to updating the annual rate for inpatient hospital payments.

"First, CMS is finalizing the last year of recoupment adjustments required by the American Taxpayer Relief Act of 2012 (ATRA). Section 631 of ATRA requires CMS to recover $ 11 billion by FY 2017 to fully recoup documentation and coding overpayments related to the transition to the MS-DRGs that began in FY 2008," states the CMS Fact Sheet. "For FYs 2014, 2015, and 2016, CMS implemented a series of cumulative -0.8 percent adjustments. For FY 2017, CMS calculates that $ 5.05 billion of the $ 11 billion requirement remains to be addressed. Therefore, CMS is finalizing a -1.5 percent adjustment to complete the statutorily specified recoupment."

And the second part of the change, which seems to be causing the confusion, is CMS took action on a -0.2 percent adjustment it implemented in the FY 2014 IPPS final rule.

This adjustment was initially made to account for an estimated increase in Medicare spending due to the 2-midnight policy. "Specifically, in the FY 2014 IPPS final rule, CMS estimated that this policy would increase expenditures and accordingly made an adjustment of -0.2% to the payment rates," states the fact sheet.

While CMS thought this adjustment was reasonable at the time, a recent review led CMS to permanently remove this adjustment, "and its effects for FYs 2014, 2015, and 2016 by adjusting the 2017 payment rates. This will increase FY 2017 payments by approximately 0.8%," stated CMS.

Hirsch says this move is "purely about money." "They are leaving the 2-midnight rule itself completely intact," he says.

The bottom line: Pay attention to 2-midnight compliance and ensure your organization has good systems in place to support it.

 

Q: When are Beneficiary and Family Centered Care Quality Improvement Organizations (BFCC-QIO) short-stay reviews going to resume?

 

A: Back in May, CMS put a hold on short-stay inpatient audits related to the 2-midnight rule. That hold was lifted effective September 12, 2016, according to a FAQ published by CMS (http://ow.ly/DQxW304bCa6).

According to the FAQ, CMS decided to lift this temporary suspension for five reasons, which are as follows:

  1. BFCC-QIOs were successfully retrained on 2-midnight rule
  2. BFCC-QIOs finished a re-review of claims that were formally denied
  3. CMS "examined and validated the BFCC-QIOs peer review activities related to short-stay reviews"
  4. BFCC-QIOs reached out to providers on claims that were affected by the temporary suspension
  5. BFCC-QIOs started provider outreach and education on the 2-midnight rule

It appears that based on the five points, the temporary audit suspension accomplished its goal of helping BFCC-QIOs sort out the challenges they faced during the initial round of audits.

Prior to the suspension, hospitals complained about inconsistencies in the review process, which triggered the suspension. The BFCC-QIO audits began in October 2015, and hospitals reported a number of surprises including:

  • Auditors requested records as far back as May 2015 when many believed the audits would only look at records from 2015 forward
  • BFCC-QIOs missed deadlines, and provided audit results late
  • Failure by BFCC-QIOs to schedule timely education for providers

 

These problems made it difficult for hospitals to hit filing deadlines, and they were consequently reporting problems because they missed the window to appeal denied claims. Hospitals also didn’t have a chance to get education to understand what they were doing wrong to fix the problem.

There were also rumored problems related to benchmark admissions. Hospitals reported that BFCC-QIOs were routinely and in some cases inappropriately denying inpatient admissions when the patient spent one night as an outpatient in the emergency department or in observation services before he or she was admitted?even when the patient spent a second night in the hospital as an inpatient.

To prevent future problems, CMS said in its FAQ that it will continue to provide oversight for BFCC-QIO efforts by:

  • Reviewing a sample of completed claim reviews each month
  • Monitoring provider education calls
  • Responding to individual provider inquiries and concern. Providers may send questions to the CMS Open Door Forum Mailbox at [email protected].

 

CMS also said that BFCC-QIOs will continue tofollow the guidance called, "Reviewing Short-Stay Hospital Claims for Patient Status." To see a copy ofthe guidance, go to www.cms.gov/research-statistics- data-and-systems/monitoring-programs/medicare-ffs- compliance-programs/medical-review/inpatienthospitalreviews.html.   

The BFCC-QIOs will also be charged with providing provider education going forward. "The BFCC-QIOs were directed to use comprehensive outreach and communication approaches (i.e., website, newsletter, one-on-one training, and town hall type events) to continue to educate providers on when payment under Medicare Part A is appropriate under the 2-midnight policy," states the FAQ. "BFCC-QIOs are required to educate providers using quality improvement core principles that facilitate continuous learning and promote greater provider understanding of the appropriate application of the 2-midnight policy in accordance with the revisions in the CY 2016 OPPS Final Rule (CMS-1633-FC): www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices-Items/CMS-1633-FC.html."

Now that audits have resumed, organizations should maintain a focus on 2-midnight compliance. Below are some tips Hirsch has recommended in the past, including:

  • Reviewing every short-stay admission?those between zero and one day?prior to billing.
  • Ensuring that every patient’s status is appropriate up front. Reviewing the chart of every patient that goes upstairs.
  • Using the physician advisor to check compliance on cases that are murky to ensure that they meet one of the exceptions under the 2-midnight rule. Changing cases that don’t meet an exception using condition code 44. If the problem isn’t discovered until after discharge, self-deny and rebill the claim.
  • Ensuring that the case managers and the physicians are up to date about any potential changes to the 2-midnight rule and how to comply.

 

HCPro.com – Case Management Monthly

CMS gives providers a chance to comment on 2-midnight rule payment methodology

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By Steven Andrews
 
Small tweaks to the 2-midnight rule in the 2016 OPPS final rule should help providers, but a lengthy court battle related to the rule could end up making a bad situation worse.  
 
A suit brought by the American Hospital Association (AHA) and other hospital associations and organizations against CMS recently resulted in the court ruling that CMS had to provide information on how it calculated a negative 0.2% reduction in inpatient payment rates as a result of implementing the 2-midnight rule. The court also said that providers should have an opportunity to comment on the calculation.
 
In early December, CMS released a notice with comment period to meet the court’s requirement, but providers might not be pleased with forcing the agency’s hand. CMS notes that when originally estimating the number of outpatient cases that should shift to inpatient as a result of the rule, it looked at 2011 claims containing HCPCS codes G0378 (hospital observation service, per hour) and G0379 (direct admission of patient for hospital observation care).
 
Using this data, CMS identified approximately 350,000 observation stays that lasted two or more midnights. The agency combined that with approximately 50,000 claims that contained major procedures based on APCs that resulted in stays lasting more than two midnights. CMS also analyzed data from the inpatient side by looking at inpatient claims containing surgical MS-DRGs with stays that lasted less than two midnights and found approximately 360,000.
 
The agency used this data to determine a net increase of 40,000 inpatient discharges as a result of the rule to calculate $ 220 million in increased expenditures on the inpatient side, leading to the reduction.
However, CMS now says that in light of new regulations and by using different metrics to estimate the shift, as many as 570,000 cases could move to the inpatient side, resulting in an even larger payment shift.

 

Providers are encouraged to comment on the rule in order to let CMS know what the best method for estimating these cases would be. This could have a large impact on payments, so if you’re interested in commenting, head to regulations.gov and make a submission by February 2, 2016. 

HCPro.com – APCs Insider

CMS shifts 2-midnight rule responsibility to QIOs, provides guidance on coding issues

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CMS finalized its proposals regarding the 2-midnight rule, including moving responsibility for rule enforcement and education from Recovery Auditors to Quality Improvement Organizations (QIO) in the 2016 OPPS final rule. This latter change occurred October 1, 2015.

For stays in which the physician expects the patient will need less than two midnights of hospital care, inpatient admission may be allowed on a case-by-case basis determined by the judgment of the admitting physician. The documentation must support the admission and will be subject to review by a QIO. CMS expects inpatient admission for minor surgical procedures to be unlikely and will prioritize those cases for medical review. For hospital stays expected to last two midnights or longer, CMS policy remains unchanged.
 
Finalizing the 2-midnight rule proposal doesn’t come as much of a surprise, says Jugna Shah, MPH, president and founder of Nimitt Consulting, based in Washington, D.C., and Spicer, Minnesota, but what remains to be seen is how the QIOs handle the review process compared to Recovery Auditors.
For providers who worked with their physician staff on improving documentation practices, this change is likely to have little or no impact, she says.
 
Providers submitted vastly divergent comments on how CMS should handle the 2-midnight rule. CMS noted that some providers asked for no changes at all. Other providers suggested a 1-midnight rule, in which any Medicare beneficiary who required an overnight hospital stay, other than a patient in the ED or routine recovery following a procedure, would be paid under Medicare Part A.
 
To facilitate this, providers suggested CMS create an “extended outpatient evaluation” APC to replace outpatient observation. Admission orders would become effective at midnight the day the order was given, except for late ED arrivals. Commenters also suggested changes to order authentication and how inpatient deductibles would be paid.
 
However, CMS thought this change would present new challenges, including low-acuity patients being held longer in order to quality for Part A payment. CMS also said the proposal could lead to additional costs that might require a greater negative payment adjustment than the 0.2% already deducted when the rule was introduced. The American Hospital Association and other hospital groups have been fighting that deduction for years, leading to a lengthy legal battle against CMS.
 
Coding and billing updates
In addition to the new policies and payments outlined in the final rule, providers will find some guidance on specific coding and billing issues.
 
CMS released HCPCS codes G0296 (counseling visit to discuss need for lung cancer screening using low-dose CT scan) and G0297 (low-dose CT scan for lung cancer screening) for billing January 1, 2016. It’s great to see CMS finally release these long-awaited codes, says Shah, and it’s good to see the rule specify that the effective date for these codes goes back to the national coverage determination (NCD) effective date of February 5, 2015.
 
“Unfortunately, CMS did not extend the timely filing date for these claims, so providers will need to prepare and submit claims for payment as soon as possible after January 1,” says Shah.
 
CMS changed the status indicator for CPT code 99497 (advance care planning including the explanation and discussion of advance directives such as standard forms [with completion of such forms, when performed], by the physician or other qualified health care professional; first 30 minutes, face-to-face with the patient, family member, and/or surrogate) from N (no additional payment, payment included in line items with APCs for incidental service) to Q1.
 
This means that separate payment will be provided when this service is provided on a date of service without a visit (status indicator V) or procedure (status indicator S or T).
 
“While it’s great that CMS again listened to commenter requests for separate payment for this important service, it’s unfortunate CMS assigned status Q1 instead of V,” says Shah. “It’s likely patients would receive this service on the same date of service as another scheduled procedure rather than on a totally separate day.”
 
Add-on code 99498 (advance care planning; each additional 30 minutes), like most other add-on codes under the OPPS, is unconditionally packaged and assigned status indicator N.
 
Editor’s note: This article was originally published in Briefings on APCs. Email your questions to editor Steven Andrews at [email protected].
 

HCPro.com – JustCoding News: Outpatient