Changes to CMS Regulations

Friday, September 27, 2013 at 12:05:12 PM

Physician Order: For payment of hospital inpatient services under Medicare Part A, the order must specify the admitting practitioner’s recommendation to admit “to inpatient,” “for inpatient services,” or similar language specifying his or her recommendation for inpatient care. “Admit to Tower 7” or “to Dr. Smith” are no longer acceptable. The order must be furnished at or before the time of the inpatient admission.

Certification: In addition to an admission order by a physician, physician certification and recertification of the necessity for inpatient admission are required. The physician must document that they expect the beneficiary to require care spanning more than 2 midnights Certification (424.13)

- Begins with the order for inpatient admission

- Must include the reasons for hospitalization for inpatient treatment

- Must include diagnosis

- Include estimated time the patient will need to remain in the hospital

- Plans for posthospital care, if appropriate

- May be entered on forms, notes, or records that the appropriate individual signs or on a separate form

- If information is in different places (i.e. progress notes, H&P) [certification] statement should indicate where it is found

- Must include services were provided in accordance with 412.3

- Certification must be signed and documented in the medical record prior to the hospital discharge (if delayed – reason must be documented)

- Acknowledge statement must be on file at the hospital

Inpatient claims with lengths of stay greater than two midnights after the formal inpatient order and admission will be presumed generally appropriate for Part A payment and will not be the focus of medical review efforts.

Use of Observation: Currently observation is in essence a continuation of the treatment or work up initiated in the emergency room which allows the physician a short period of time “before a decision can be made regarding whether patients will require further treatment as an inpatient if they are able to be discharged from the hospital.” Now the guidance is that when it isn’t clear as a result of the ED evaluation whether a patient requires inpatient admission for two midnights, “the physician should not admit the beneficiary but should place the beneficiary in observation as an outpatient. As new information becomes available, the physician must the reassess the beneficiary to determine if discharge is possible or if it is evident that an inpatient stay is required.”

Stays expected to last less than 2 midnights are generally inappropriate for inpatient hospital admission with the exception of those services designated by the Outpatient Prospective Payment System (OPPS) Inpatient-Only list as inpatient-only-services. Not even ICU stays are exempt from the two midnight rule.


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