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CMS delays review of short stay patient claims under two midnight rule

Pause gives reviewers time to get caught up on standardization around loathed policy.

Susan Morse, Managing Editor

The Centers for Medicare and Medicaid Services has temporarily suspended its review of short stay patient claims to give reviewers time to improve the standardization around the two midnight rule, CMS said in a June 6 update.

The reviews are expected to resume within 60-90 days. CMS said it would advise providers when the pause is lifted.

This means hospitals can expect a decision on claims starting at the end of July or August.

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[Also: CMS proposes payment rule for inpatient stays, long-term care, rolls back two-midnight cuts]

CMS said more time was needed to improve standardization around the review process by the Beneficiary and Family Centered Care - Quality Improvement Organizations, after the agency became aware of inconsistencies in the application of the two-midnight policy for short hospital stays.

The two midnight rule states hospital stays of less than two midnights are not designated as inpatient status and are not appropriate for Medicare A reimbursement.

The reviews will determine whether Part A payments for short stay inpatient hospital claims have been appropriately paid, CMS said.

[Also: 55 hospitals sue HHS over two-midnight rule, payment cuts]

CMS is requiring a re-review of all claims denied since October 1, 2015, when BFCC-QIO took over the initial review process from Medicare Administrative Contractors.

The claim reviews will resume after the BFCC-QIOs have completed retraining on the two-midnight policy, completed the re-review of previously denied claims, and performed any needed provider outreach and education, CMS said.

CMS is urging hospitals to work with their Beneficiary and Family Centered Care - Quality Improvement Organization before appealing a claim denial.

[Also: CMS cements 'physician judgment' exception in two-midnight policy]

Hospitals will receive a letter from the BFCC-QIO if denied claims are being re-reviewed, as well as a letter detailing the decisions.

If upon re-review it is determined that the claim was incorrectly denied, the appeals adjudicators will issue revised determinations as necessary, CMS said.

If a hospital has already submitted an appeal, then the BFCC-QIO will share its re-review findings with the appeals adjudicators to be taken into consideration during the appeal process, CMS said.

The two midnight rule remains in effect but in April, CMS axed the 0.2 percent inpatient payment cut that went into effect under the rule, after 55 hospitals sued the Secretary of Health and Human Services over the cut.

Under the new rule released in April, hospitals will get a one-time 0.6 percent payment in 2017 to make up for the 0.2 percent reduction that has been imposed over the last three years.

Twitter: @SusanJMorse