Six Ohio hospitals are suing HHS over a part of the two-midnight rule that would cut inpatient payments to hospitals.
The hospitals want the U.S. District Court in Columbus to vacate a part of the rule, implemented in 2013, that reduces compensation for inpatient services by 0.2%. That reduction was meant to offset estimated costs to Medicare associated with the rule, which directs CMS payment contractors to presume short-term hospital stays are inpatient admissions, rather than outpatient observation visits if they span two midnights.
The hospitals say that the part of the rule calling for payment reductions is “an arbitrary, capricious and unreasonable exercise of authority under the Medicare Act” and that HHS didn't follow the proper rulemaking process in issuing it. The six hospitals stand to lose about $564,106 a year under the rule, they say.
