The In and Out of the Medicare Two Midnight Rule. Disclaimer. Objectives 3/31/2014

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1 The In and Out of the Medicare Two Midnight Rule Brenda Keeling, RN, CPHQ, CCM Patient Response, Inc. 1 Disclaimer Information enclosed was current at the time it was presented. Medicare policy changes frequently so the presenter makes no guarantee; representation; or warranty that this compilation of Medicare information is error-free and will bear no responsibility or liability for the results or consequences of the use of this guide. This is not a legal document. There are no financial relationships or potential conflicts of interest contained in the presentation. 2 Objectives Describe updates to CMS s 2 midnight rule. Identify new guidance offered by CMS to help interpret the two-midnight rule. Define the two-midnight inpatient presumption rule Identify potential methods to implement the new rule at your facility. 3 1

2 Key Terms and Definitions Observation Inpatient Medical Necessity 2 Midnight Rule Presumption Span Code 72 Certification Probe 4 What is Observation? Well-defined set of specific, clinically appropriate services, which include ongoing short term treatment, assessment and reassessment before a decision can be made regarding whether patients will require further treatment as hospital inpatients or if they are able to be discharged from the hospital. 5 Observation (continued)) Most observations services do not exceed 24 hours Some patient may require 48 hours In only rare and exceptional cases do outpatient observation services span more than 48 hours G0379- Direct admission ONLY-The patient directed to the hospital for observation (these are patients that usually come directly from physician office (not to be used when coming from ER) 6 2

3 Observation Examples Abdominal pain not requiring surgery Allergic reaction, generalized Altered mental status Anemia Back pain Chest pain CHF GI conditions Nutritional & metabolic disorders Hypertension Headache, unknown etiology Shortness of breath 7 Example: Post Op Observation Mental status change Fever Inability to void Pain Nausea/vomiting Bleeding Cardiovascular of respiratory compromise 6 Hours Post op included in procedure 8 OBS Medicare What does it mean? Lost reimbursement Medicare OBS Hours Six Month Review Period MC Reimb Additional cost $1,037 per day) of $171,830 When unit is running full you have: Lost revenue Increased cost Poor patient satisfaction due to increased wait times Throughput vulnerability by TJC and CMS Risk of nosocomial infection, medication errors and patient falls Total Hours >48 per hour Lost Reimb. ADC 3, $47.73 $189,

4 Total Hours > 24 Hrs. OBS Medicaid What does it mean? Medicaid OBS Hours Six Month Review Period Medicaid Reimbursement per hour Lost Reimb ADC $6,669.5 $36.28 $241, *Estimated as 75% of Medicare Rate Lost reimbursement Additional cost $1,037 per day) of $288,182 When unit is running full you have: Lost revenue Increased cost Poor patient satisfaction due to increased wait times Throughput vulnerability by TJC and CMS Risk of nosocomial infection, medication errors and patient falls 10 OBS MC + MCD What does it mean? M/Care + M/Caid OBS Hours Six Month Review Period Total Hrs > than Criteria Reimb per hour Lost Reim ADC Medicare $3, $47.73 $189, Medicaid $6, $36.28 $241, Six Month Total $10, $431, Annualized Lost $21, $863, Revenue Annualized Additional Cost $920,022 Total Annualized Lost Rev + Add l Cost $1,783,559 A whole lot of work for Nothing 11 What is Inpatient? These services include bed and board, nursing services, diagnostic or therapeutic services, and medical or surgical services. Health care received when the patient is admitted to a hospital. Inpatient starts the day the patient is formally admitted to the hospital with a physician order. The day before discharge is the last inpatient day. Medicare Part A (Hospital Insurance) covers inpatient hospital services. 12 4

5 IP Medical Necessity Care that can only be provided during an inpatient hospital stay Social Security Act 1862 (a)(1)(a) Shifts the focus of the review to span 2 midnights (absent any exceptions) Focuses on medically necessary hospital care 13 What is the Two Midnight Rule? If a patient is in the hospital for a stay that does not span at least two midnights, the services are generally inappropriate for payment under Medicare Part A, regardless of the hour the patient came to the hospital or whether the patient used a bed. CMS, August 2, Why Was it Developed? A rule developed in effort for CMS to address concerns of Medicare Part A beneficiaries who have reported long hospital stays as outpatients. To provide greater clarity and to help physicians determine appropriate inpatient status for the Medicare Part A patient. 15 5

6 2014 IPPS 2 MN Rule CMS-1599-F August 2, 2013 Modifies and clarifies policy of Medicare Administrative i ti Contractor t review of IP status 16 Implementation Effective October 1, 2013 Physician judgment History of comorbid conditions Severity of signs/symptoms of patient Medical needs Risk Expectation the patient will require 2 midnights in house Requires physician certification Starts when IP order is written Must have documented reason for hospitalization Must have estimated time Must be done prior to discharge 17 Appropriate 2 MN Inpatient The physician expects the patient to require a stay that spans two midnights Physician admits the patient to the hospital based on that expectation Inpatient Only procedures are IP regardless of span of 2 midnights 18 6

7 Inappropriate 2 MN Inpatient The physician anticipates the patient will be in the hospital for only a limited time that will not span 2 midnights CMS anticipates these services should be submitted for Part B payment 19 Exceptions to the 2 MN Rule Medically necessary procedures on the Inpatient Only list Conditions Approved d by CMS and outlined in subregulatory guidance New onset medical ventilation**** 20 Unforeseen Conditions Death Transfer Departure against medical advice (AMA) Unforeseen recovery Election for hospice care 21 7

8 Negatives to 2 MN Rule Patients paying larger portions of bills Confusion among patients Poor patient satisfaction Increased patient complaints Lower Medicare payments to institutions Increased uncompensated care Increased staff cost to collect Patients will have to provide selfadministered drugs or hospital provide at additional cost to the patient 22 Presumption Selection for Review Describes whether claims will be selected for review under 2 MN rule If a claim shows 2 or more MN after formal IP admission begins, the contract will presume IP is appropriate, negating focus for medical review However: Claim patterns will be reviewed for evidence of gaming or abuse 23 Span Code 72 Voluntary code but CMS recommends use Used to report the number of MN the patient spent in the facility from the start of care until formal IP admission Code allows for contiguous OP services preceding IP admission to be reported on IP claims 24 8

9 Certification Social Security Act 1814(a) requires physician certification of medical necessity for inpatient service Order to admit is critical for inpatient coverage and payment Certification including the order is necessary to support IP services as reasonable and necessary 25 Content of Certification Authentication of Practitioner Order Reason for Inpatient services Estimated or actual required hospital time Plans for post-hospital care Critical Access (CAH) Only-96 hour rule Inpatient Rehabilitation facility requirements 26 Format of Certification There is no specific format All requisite information is present in the medical record (i.e., physician progress notes, etc) this may fulfill the certification 27 9

10 Timing Certification begins with the order Must be completed, signed, dated, and documented Good d medical documentation ti fulfills certification Must be completed prior to discharge 28 When Does the Clock Start Ticking Hospital care begins Observation care ER, OR, other treatment services Start t of care following registration ti and initial triage (vital signs) Excludes excessive wait times 29 Authorization Requires an MD or DO Dentist as specified by 42 CFR (d) Podiatry The certifying physician must be responsible for the beneficiary or have sufficient knowledge of the case (and be authorized to certify) 30 10

11 Sufficient Knowledge Surgeon or physician on call Surgeon responsible for major procedure Dentist as admitting physician of record or surgeon for major dental procedure Non-physician/non-dentist admitting practitioner licensed by state/privileged by the facility Member of the URC that has reviewed the file ED physician or hospitalist (update 2/7/2014) 31 Order Requires a formal admission order Must be completed by a qualified physician/practitioner Inpatient t status t begins at time of order 32 Qualifications of the Ordering Physician Must be physician or practitioner: Licensed by the state to admit inpatients Granted privileges by hospital for admissions Knowledgeable about the patient Not required to be certifying practitioner 33 11

12 Verbal Orders Nurses may be permitted to accept and record verbal orders Ordering practitioner must directly communicate the order and must countersign the order as written to authenticate IP time starts with the verbal order if authenticated State laws, hospital policy and bylaws, rules and regulations must be met 34 Standing Orders and Protocols Standing orders are not acceptable Protocol and algorithm may be used in considering IP admission Only l the ordering physician i or physician i acting on his/her behalf (i.e., resident) may make and take responsibility for an admission decision 35 Transfers Start the clock for transfers when the care begins in the initial facility Excessive wait times or time spent in the hospital for non-medically necessary services must be excluded Receiving facility may requests transferring facility records for validation 36 12

13 Off Campus ER If the off campus ER has the same provider number as the acute care facility it is not considered a transfer The total time in the hospital should be counted for purposes of the 2 midnight rule 37 Questions to Ask Can services only be provided in hospital setting? What physician documentation is present to justify medical necessity? If so, is it going to take longer than 2 midnights to care for the patient? 38 Implementation Timeframe October 2013 January CMS reported a grace period until October 1, 2014 Effective Friday, March 27 th, postponed until March

14 Review Process Review contractors will include the time the beneficiary spends receiving outpatient care in determining the decision for IP Time spent for treatment prior to the 96 hours in a CAH is not considered in the 2 midnights 40 Examples: Time 0-1 MN: RAC or MAC will review to determine if the patient was admitted for an IP only procedure or if other circumstance justify IP per CMS 2 or more MN: Contractor will usually find Part A payment appropriate 41 Medicare Audit Contractor Denial The beneficiary stay does not meet the threshold criteria of 2 midnight stay to qualify for Inpatient status as per CMS 1599-f. The documentation provided does not support the reasonable anticipation that the beneficiary would require a 2 midnight stay upon admission. There was also no documentation stating the patient would require a 2 midnight stay. The patient presented for a planned procedure that is not on the inpatient only list and procedure was uncomplicated. She was admitted post-operatively as inpatient. The inpatient order was signed prior to discharge. certification criteria were met

15 Process Solutions Implement 24/7 ER Case Management Perform 100% concurrent review for time sensitive diagnosis (< 2mn) Educate physicians and get them on board Educate t Physicians i and Hospitalist t they can no longer use 2 days for workup of what if s Invest in greater resources to collect the copay (20%) Implement process for self denial or when appropriate for Part B billing 43 Sample Case Scenarios 44 Scenario # 1 68 y/o male presents to ED with three day history of UTI symptoms, with vague intermittent abdominal pain. C/O gassy and feverish for several days, accompanied by intermittent chills, n/v. Current meds include: po meds for constipation, HTN, cholesterol, and DM. C/O flu like symptoms and loss of appetite

16 Scenario #1 10/1/ :00 pm-patient triaged 10:10 pm-urine sample and glucometer reading obtained and pt. sent to waiting room 11:00 pm-md assesses patient, orders therapeutic/additional diagnostic modalities 12:00 am-patient now c/o chest pain and additional DX. Test and treatment ordered 10/2/ :15 am-md re-evaluates and determines a need for medically necessary IP level of care/services for the pt beyond MN 2 10/3/2013 7:35 am-pt. is discharge home 46 Scenario #1 The hospital can bill IP Part A payment Claim demonstrates 1 mn of OP and 1 MN IP 47 Scenario #2 80 y/o female presents to phy office feeling poorly. PMH is significant for COPD and the pt. takes multiple meds. SOB has increased over the past three days

17 Scenario #2 10/1/2013 6:00 pm-pt evaluated by primary phy and sent by ambulance to the hospital for further evaluation 9:00 pm-upon arrival the admitting phy confirms COPD and admits to IP based on expectation care will span 2 midnights 10/2/ /4/2013 Pt continues to receive medically necessary hospital care 10/5/2013 9:00 am-patient is discharged home 49 Scenario #2 The facility may bill as IP Part A payment Claim demonstrates 2 mn of IP Review contractors will generally not select this case for review based on presumption 50 Scenario #3 73 y/o male presents to the ED and is admitted to ICU for tele monitoring following an accidental toxic exposure 51 17

18 Scenario #3 12/1/2013 9:00 am-pt arrives via ambulance to the ED awake and alert 9:03 am-poison control consulted and advises tele monitoring with plans to intubate if necessary. Tele monitoring only available in ICU at the small facility 9:07 am-dx test and treatment ordered and initiated. Airway intact. 10:00 am-phy requests transfer to ICU for tele. Unclear if the pt will need 2 mn. Decision will depend on clinical presentation and dx. Modalities. 12/2/ :30 am-medical concerns and symptoms resolving; airway intact and does not require ventilation 12:00 pm-phy writes orders for D/C home 52 Scenario #3 Hospital should bill OP services. Location of care does not dictate status LOS expectation was unclear upon presentation ti Phy appropriately kept the pt as OP because of care passing 2 mn never developed. 53 References CMS: Frequently Asked Questions: 2Midnight Inpatient Admission Guidance & Patient Status Reviews for Admissions on or after October 1, 2013 CMS Hospital Inpatient Admission Order and Certification CMS: Selecting Hospital Claims for Patient Status Reviews: Admissions On or After October 1, g CMS: MLN Matters MM8586 CMS: MLN SE 1403 CMS: Special Open Door Forum Transcript, Aug. 15, C.F.R , , and : Regulatory Language Relating to the Two-Midnight Rule and Physician Orders and Certification 42. C.F.R : Regulatory Language Relating to the Part B Inpatient Billing Preamble, Hospital Inpatient Prospective Payment Systems for Acute Care Hospital, 78 Fed. Reg , (Aug. 19, 2013) 54 18

19 Questions? 55 19