CMS officials said during a national conference call on Tuesday that Medicare's recovery auditors will not be allowed to audit inpatient claims under the two-midnight rule until after Sept. 30. However, the agency said its administrative contractors, which process the bills and do some auditing work before payment, will continue to probe small numbers of cases and “educate” hospitals on whether the claims broke the new rules.
For example, the new regulations say that a nurse can document a physician's “verbal order” to admit a patient in the medical record, even though the nurse lacks the authority to admit a patient independently. An admitting physician must countersign the decision before the patient leaves the hospital.
If it later turns out that the doctor disagrees with the decision to admit and refuses to sign the order, the hospital can still send the bills through Medicare's Part B system for outpatient care, according to the rules.
Likewise, a medical resident, physician assistant or nurse practitioner may write the inpatient admitting order as a proxy for the physician. But that applies only when a physician “approves and accepts responsibility for the admission decision by countersigning the order prior to discharge.”
Decisions to admit patients to the hospital have become fraught territory for hospital officials, who complain that Medicare rules have been unclear even though providers are subject to extensive data-mining and auditing after the fact.
The result was that growing numbers of patients were placed in hospital beds but classified as outpatient observation cases, which can protect the hospital from auditing but exposes patients to copayments and bills for post-acute rehabilitation care that would otherwise have been covered fully by Medicare.
The two-midnight policy, announced last fall as part of the 2014 Medicare inpatient payment rates, was intended to reduce the number of long observation stays by clarifying that any patient sick enough to get at least two nights of hospital care is now presumed to have had a legitimate hospital stay.
But hospitals predicted that the rule would deny them full inpatient payments for short hospital stays that are legitimate admissions. Several hospitals have laid the groundwork for potential litigation on the matter, and interest groups such as the American Hospital Association have supported legislation to delay implementation of the rule.
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