On Sept. 26, the Centers for Medicare & Medicaid Services (CMS) issued new guidance in the form of several frequently asked questions on the admission and review criteria it adopted in the fiscal year (FY) 2014 hospital inpatient prospective payment system (PPS) final rule. The agency reiterated that Medicare Administrative Contractors (MACs) and Recovery Audit Contractors (RACs) are not to review claims spanning more than two midnights after admission for a determination of whether the inpatient hospital admission was appropriate.
CMS also announced that, for a period of 90 days, it will not permit RACs to review inpatient admissions of one midnight or less that begin on or after Oct. 1, 2013. In addition, the agency stated that MACs and RACs will not review any claims from critical access hospitals during this period.
However, CMS will allow the MACs to review small samples of inpatient hospital claims (10–25 per hospital) with admission dates of Oct. 1, 2013 through Dec. 31, 2013 that span less than two midnights to determine whether the inpatient hospital admission was appropriate. If the MAC determines that an admission was not appropriate, it will deny the claim and conduct education for the hospital.
The hospital would then be able to rebill the denied claim in accordance with the agency’s rebilling policy. If, however, the MAC determines that the hospital’s inpatient hospital admissions were appropriate, it will cease further reviews for that hospital from Oct. 1, 2013 through Dec. 31, 2013, unless there are significant changes in billing patterns for admissions.
Finally, the agency reiterates that while medical review will not be focused on claims spanning two midnights or more, physicians should make admission decisions in accordance with the two-midnight provisions in the final rule. If there is evidence of “systematic gaming, abuse or delays in the provision of care in an attempt to surpass the two-midnight presumption,” medical review could be warranted.
CMS’s new guidance attempts to provide the hospital field with much needed clarification on the two-midnight policy, but the document falls far short. Unfortunately, it only raises new questions and lacks clarity with regard to enforcement of the policy over the next 90 days.
While the agency provided some additional clarification around these questions on its Sept. 26 Open Door Forum, hospitals do not support the implementation of this regulation under these circumstances – too many aspects are fundamentally flawed.
The American Hospital Association believes that, at this point, the only workable approach is to suspend the rule and immediately start dialog on a new policy direction. Specifically, AHA continues to believe that a long-term payment solution is the answer.
To that end, they are also very disappointed that CMS plans to move forward with its 0.2 percent reduction to the inpatient PPS market basket update that the agency argues is necessary to offset increased expenditures that will result from its new policy. AHA continues to oppose this deeply flawed reduction.
To view the AHA’s full statement to the media, click here. In addition, CMS indicated that it will soon post additional guidance and frequently asked questions on its website at www.cms.gov/medical-review.
If you have further questions, contact Gwen Combs, MHA vice president for policy, at (800) 289-8884, (601) 368-3255 or gcombs@mhanet.org.
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