Two-Midnight Ruling Part A/Part B Re-billing

1. Two-Midnight RulingPart A/Part B Re-billing JoNell Moore, RN jmoore@eidebailly.com 701.239.8690

2. Two-Midnight Ruling 2014 IPPS Final Rule (August 19, 2013) CMS interpretations, clarifications, changes happening daily Opposition by AHA, HFMA, over 100 US Congressmen (bipartisan coalition), Federation of American Hospitals, etc. All requesting to either eliminate the rule or revise the rule and at the very least, a 6 month delay

3. Two-Midnight Ruling WHY? CMS has concerns regarding problems with observation services from both the provider and beneficiary perspective Too many appeals RAC audits of one-day stays Ability to re-bill select services if inpatient stay denied

4. Two-Midnight Ruling • Two concepts • Two-Midnight “presumption”---Medicare contractors are not to select inpatient claims for review if the inpatient stay spanned two midnights from the time of an admission (begins when inpatient order is written) • Two-Midnight “benchmark”---Instructs admitting practitioners and Medicare review contractors that an inpatient admission is generally appropriate when the admitting practitioner has a documented expectation that the patient will need to receive care for a period spanning two-midnights

5. Two-Midnight Ruling • Effective October 1, 2013 • Given a 90 day transition period • Delays full implementation until January 1, 2014 • From October 1, 2013 – December 31, 2013: • MACs and RACs are not to review claims spanning > 2 midnights • RACs cannot review inpatient admissions of one midnight or less • MACs and RACs cannot review any claims for inpatient stays for CAHs

6. Two-Midnight Ruling MACs will review a sample of claims spanning less than two midnights to determine medical necessity with admission dates during this time period 10 claims for a small hospital, 25 claims for larger hospitals----prepayment claims Hospitals can re-bill denied admissions CMS will provide education “Educate and Probe”

7. Two-Midnight Ruling • Practitioner “Order” • Not really anything new • Written to indicate “admission to inpatient” • Written by a practitioner who is licensed by the State, granted privileges by the hospital to admit, knowledgeable about the patient’s hospital course, plan of care and condition at the time of admission • Order must be written at or before the time of the admission • Ordering physician may or may not be the physician signing the “Certification”

8. Two-Midnight Ruling • Physician “Certification”—evidence the services were reasonable and necessary • The most troublesome requirement • Must be completed, signed, dated and documented in the medical record prior to discharge • For CAHs, is required no later than 1 day prior to the submission of the claim for payment

9. Two-Midnight Ruling • Certification must include: • Authentication of the order….the physician certifies the inpatient services are reasonable and necessary (evidenced by signature or counter signature) • Reason for inpatient services • Estimated time the beneficiary will require inpatient services (span of two-midnights or more) • Plans for post-hospital care • For CAHs, must certify patient will be discharged or transferred within 96 hours (subject to CMS clarification they say is coming soon)

10. Two-Midnight Ruling • Authorization to sign the Certification • At this point may only be signed by a physician, dentist in special circumstances or doctor of podiatric medicine • Mid-level practitioners cannot sign Certifications • No special forms needed---although most facilities are creating forms • Could be part of medical record if the elements are easily identified • Again, must be all completed prior to discharge

11. Two-Midnight Ruling • What will the claims look like? • No instructions finalized at this point • Some discussion on creating a new occurrence span code indicating the patient was receiving outpatient services prior to the inpatient admission and the date span of those services • Possibly create a condition code similar to condition code 44

12. Two-Midnight Ruling CMS has stated: “The Medicare review contractor may consider only information that was available to the admitting practitioner at the time of the admission, and must not consider information that becomes available only after the admission, such as the patient’s actual length of stay and outcome” In other words, no Monday morning quarterbacking!

13. Two-Midnight Ruling • CMS states they understand there may be appropriate inpatient stays that do not span two-midnights: • “Inpatient-only procedures” where a patient may be safely discharged before two-midnights • Patients that are transferred before two mid-nights • Patient’s death • Patient’s leaving against medical advice

14. Two-Midnight Ruling • Inpatient Criteria per CMS • Based on documentedmedical factors and physician judgment • Patient history, co-morbidities, severity of signs and symptoms • Current medical needs • Risk of an adverse event happening • CMS will be issuing a sub-regulatory guidance to address what happens when there is a conflict between the screening tools (InterQual or Milliman) and the new criteria

15. Two-Midnight Ruling Email address for questions for CMS • IPPSAdmissions@cms.hhs.gov Website for Q&A’s on Two-Midnight Ruling • www.CMS.gov/medical-review (click on “Inpatient Hospital Reviews” and under “Downloads” click on “Questions and Answers Relating to Patient Status Reviews”)

16. Two-Midnight Ruling • Possible effects: • Numerous • AHA is requesting a payment solution for “those intense, inpatient-level services provided by hospitals that are reasonable and necessary but do not appear on the inpatient-only list and are not expected to span two-midnights (i.e., vascular procedures) • CMS states reimbursement will increase due to more inpatient stays

17. Two-Midnight Ruling AHA and Federation of Hospitals state, “CMS used flawed and arbitrary assumptions to justify its $200 million payment cut to hospitals (0.2% reduction in the PPS market basket update), purportedly to achieve budget neutrality for the two-midnight rule”

18. Part B Re-billing Historically hospitals/physician reluctant to order an inpatient admission due to denials If the inpatient admission was denied, hospitals could only bill a limited number of ancillary services If the patient had been an outpatient from the beginning, the services would have been payable

19. Part B Re-billing Resulted in extended observation services CMS concerned about “prolonged outpatient treatment period trend” (CY 2013 OPPS/ASC proposed and final rule) Concerned this was resulting in increased patient liability in the form of Medicare Part B copayments, charges for self-administered drugs and post-hospital skilled nursing care

20. Part B Re-billing • MLN Matters Number SE1333 • For admissions on or after October 1, 2013 “Will allow payment for all hospital services that were furnished and would have been reasonable and necessary if the beneficiary had been treated as an outpatient, rather than an inpatient, except for those services that specifically require an outpatient status such as outpatient visits, emergency department visits, and observation services, that are, by definition, provided to hospital outpatients and not inpatients”

21. Part B Re-billing Must be timely filed Cannot bill both an inpatient and outpatient claim simultaneously to hedge your bets A “no pay/provider liable” claim must be present in the system and posted in the claims history The patient is responsible for the Part B liability amounts The status of the patient does not change from inpatient to outpatient even with an inpatient Part A denial, so there may still be a possibility of SNF coverage

22. Part B Re-billing Now can bill OR services, therapy (caps apply for PPS hospitals) Must refund to patient the Part A liability amounts (cannot off set against their Part B liability) May have two claims---131 TOB for all services provided in the 3-day window for PPS hospitals and 121 TOB for all services performed during the inpatient stay Use the same billing and coding rules used for assigning dates of service to services that cross midnight Use the start of the service to determine correct claim placement “Inpatient-only-procedures” performed prior to admission will not be paid under the Part B Re-billing rule

23. Part B Re-billing Patients that are not entitled to Part A or have exhausted their Part A benefits, hospitals may only bill for the limited inpatient services as indicated in the Medicare Benefit Policy Manual Chapter 6, Section 10

24. Part B Re-billing If submitting a Part B claim for a denied Part A inpatient claim, there are no appeal rights for the Part A claim Cannot bill infusions, injections, blood transfusions, nebulizers under Part B (considered nursing services and part of the inpatient room charge) DSMT, clinic visits are not billable under Part B

25. Questions? Questions? Miscellaneous Items