In two related lawsuits filed April 14, the hospital industry challenged the Department of Health and Human Services’ (HHS’s) “two-midnight” rule for inpatient admissions, which the industry says imposes regulatory burdens that could compromise care for seniors. In one complaint filed in the U.S. District Court for the District of Columbia, the American Hospital Association (AHA), other groups, and individual hospitals challenged an August 2013 HHS policy for determining when a patient is an “inpatient” for purposes of Medicare reimbursement (Am. Hosp. Ass’n v. Sebelius, D.D.C., No. 1:14-cv-609, filed 4/14/14). The AHA’s filing said that this “new rule provides that a Medicare beneficiary is not an ‘inpatient’ unless the admitting physician expects that beneficiary to need care in the hospital for a period spanning two midnights.” The August 2013 rule was scheduled to apply to fiscal year 2014 payments. In a statement from the AHA, the plaintiffs said hospitals “take issue with the wholly arbitrary requirement that a physician must certify at the time of admission that a Medicare patient is expected to need care in the hospital for a period spanning two midnights to be considered an inpatient.” Series of Delays The final two-midnight rule, promulgated because of concerns […]
In two related lawsuits filed April 14, the hospital industry challenged the Department of Health and Human Services’ (HHS’s) “two-midnight” rule for inpatient admissions, which the industry says imposes regulatory burdens that could compromise care for seniors.
In one complaint filed in the U.S. District Court for the District of Columbia, the American Hospital Association (AHA), other groups, and individual hospitals challenged an August 2013 HHS policy for determining when a patient is an “inpatient” for purposes of Medicare reimbursement (Am. Hosp. Ass’n v. Sebelius, D.D.C., No. 1:14-cv-609, filed 4/14/14).
The AHA’s filing said that this “new rule provides that a Medicare beneficiary is not an ‘inpatient’ unless the admitting physician expects that beneficiary to need care in the hospital for a period spanning two midnights.” The August 2013 rule was scheduled to apply to fiscal year 2014 payments.
In a statement from the AHA, the plaintiffs said hospitals “take issue with the wholly arbitrary requirement that a physician must certify at the time of admission that a Medicare patient is expected to need care in the hospital for a period spanning two midnights to be considered an inpatient.”
Series of Delays
The final two-midnight rule, promulgated because of concerns that hospitals were overusing observation status, has been controversial from its inception, with hospitals and lawmakers seeking implementation delays and reconsideration immediately after the rule was first issued in final form.
The rule was scheduled to take effect on Oct. 1, 2013, but enforcement has since been delayed on multiple occasions. The Centers for Medicare and Medicaid Services (CMS) initially gave affected providers a three-month grace period and thereafter extended the audit-free transition period through March 31. Another delay, announced Jan. 31, extended the enforcement delay through Sept. 30.
Only weeks ago, Congress passed and President Barack Obama signed a law that extended the enforcement moratorium on the two-midnight rule through March 2015. With the extension, and on top of the delays already implemented, Medicare Recovery Audit Contractors (RACs) won’t be able to audit inpatient hospital claims from Oct. 1, 2013, through March 31, 2015.
Although implementation of the two-midnight rule has now been delayed, an AHA spokeswoman said the delay does not resolve the issues raised in their lawsuits. Although RACs will not conduct patient status reviews for dates of admission between Oct. 1, 2013, through March 31, 2015, during this time CMS will conduct limited prepayment “Probe and Educate” audits to determine a provider’s compliance with the requirements of the two-midnight rule, the spokeswoman noted. “Essentially, this means that hospitals must now comply with the requirements of the rule,” she said.
Takeaway: Hospital groups believe HHS’s “two-midnight” rule for inpatient admissions undermines patient care.
