Two-Midnight Rule Process

1. Two-Midnight Rule Process Pam Applegate, MA, RHIT Senior Program Director

2. Two-Midnight Rule • October 2013: Two-Midnight Rule is implemented • Adopted for inpatient admissions occurring on or after October 1, 2013 (fiscal year 2014) • FY 2014 Hospital IPPS Final Rule CMS-1599-F established two distinct, but related, medical review policies • 2-Midnight presumption: claims with LOS >2 midnights after formal admission order are presumed to be appropriate for Part A payment and are not the focus of medical review efforts • 2-Midnight benchmark: provides guidance to Medicare review contractors to identify inpatient admissions generally appropriate for Part A payment under CMS-1599-F, as revised by CMS-1633-F

3. Two-Midnight Rule • October 2015: Responsibility for reviews of <2 midnight inpatient stays transitioned from MACs to QIOs • MAC reviews were prospective (pre-pay) • QIO reviews are retrospective (post-pay) • Inpatient claims have three dates • From Date (Date patient started receiving services) • Admission Date (Date inpatient order is written) • Thru Date (Discharge Date) • A claim is subject to review under < 2 midnight inpatient stay if the date of admission to the date of discharge is less than 2 days (0-1 day length of stay)

4. Two-Midnight Cycles • There are two 6-month review cycles per year • October – March • April – September • Hospitals will be sampled no more than once in a 6-month cycle

5. Two-Midnight Universes • Paid claims with 0-1 day LOS are supplied to the QIO monthly • October 2015 universes contained claims from May 2015 • November 2015 universes contained claims from June 2015 • December 2015 universes contained claims from October 2015 • January 2016 universes contained claims from November 2015 • February 2016 universes contained claims from December 2015 • March 2016 universes contained claims from January 2016 • Future universes will most likely continue to follow a two-month lag period

6. Two-Midnight Sampling • Monthly sample is chosen • 0-day stays are prioritized, as directed by CMS • Large hospitals – 25 claim sample • Average hospitals – 10 claim sample • Sampled claims may be pulled from multiple universes to reach desired number of claims for the hospital – so one sample may contain discharges from multiple months • If a hospital has less than the required number of claims for sampling within a 6-month cycle, it will not be sampled

7. 2M Medical Record Requests • Monthly samples are imported into the CMS-supplied Case Review Information System (CRIS) and medical record requests are generated • Medical Record contact information for these requests is stored in the government system and updated as hospitals request • The government system only allows for one Medical Record contact and one QIO Liaison – cannot be unique for different claim types • One envelope is mailed via USPS and contains instructions for submitting the medical records along with a cover sheet for each record requested • Note that the cover sheet lists the From and Thru Dates • Medical records are due 30 days from the request

8. 2M Submission Instructions

9. 2M Example Cover Sheet

10. Record Request Follow-Up • Around day 15 of an outstanding medical record request, Livanta calls the provider to ensure that the request was received and is in process • We can then fax the request and cover sheets to the provider, if needed • Around day 30 Livanta will send a Technical Denial Warning letter to the provider with cover sheets of outstanding records • Around day 45 if the records have still not been received, a technical denial letter is sent to the beneficiary, provider, and MAC

11. Reopening Technical Denials • If Livanta receives the medical record for which a technical denial has been issued, the case will be reopened, provided the final determination for the sample has not yet been mailed • If the technical denial is reopened, the beneficiary, the provider, and the MAC are notified that the record will be reviewed

12. 2M Review Process • Medical records are first screened by our Registered Nurse Review Coordinators who check for the following: • Admission Order requirements are met • Two-Midnight Benchmark is met • InterQual or MCG may be used to support medical necessity for approval of the admission • No inpatient order = billing error • Independent licensed practicing physician reviewers who are board-certified with hospital privileges make the final determination on any case not clearly meeting the requirements of the Two-Midnight Rule

13. Two-Midnight Rule Benchmark • Two-Midnight Benchmark • Provides guidance to Medicare review contractors for identifying when an inpatient admission is generally appropriate for payment under Part A • Patient admitted for an Inpatient-Only procedure • Medical record supports the admitting physician’s determination that the patient requires inpatient care despite the lack of a two-midnight expectation – case-by-case exception • Complex medical factors such as history, comorbidities, severity of signs and symptoms, current medical needs, risk of an adverse event – all can support need for inpatient hospital care • Physician expects medically necessary acute hospital services will be needed for 2 or more midnights as supported by documentation in the record

14. Two-Midnight Rule Benchmark • Two-Midnight Benchmark • Unforeseen Circumstances – death, transfer to another hospital, discharge against medical advice (AMA), clinical improvement, election of hospice care • Based upon physician’s expectation of the required duration of medically necessary acute hospital services at the time the inpatient order is written • Reasonableness of the inpatient admission based on the information known to the physician at the time the inpatient order is written – may be inferred from medical documentation (care plan, orders, notes, etc.)

15. Two-Midnight Rule Benchmark • 2M Rule Benchmark and Outpatient Time • The record must first support the determination that the patient required acute hospital services to qualify for Part A payment • If the patient required acute hospital services, Livanta will consider the pre-admission time such as services provided under observation, treatment in the ED, and/or procedures in the operating room or other treatment area of the hospital • For patients transferred to another hospital, the time care began at the initial hospital will be taken into account

16. 2M Review Timelines/Delays • Delay in initial sampling – first medical records not requested until mid to late November 2015 • Three monthly samples requested within 3 weeks initially – overwhelmed our Mailroom and delayed getting records ready for review • Reviews began in earnest in mid-December 2015 • QIO has obligation to complete medical review of a record within 30 days of medical record receipt • We are not yet hitting this target due to the confluence of multiple samples and Mailroom delays

17. Stratification • After determinations are made for a hospital’s entire sample, the Initial Review Results Letter is sent to the QIO Liaison, with a determination for each sampled claim and stratification results • “Minor” concern hospitals have <10.01% errors • May submit additional information within 20 days • No 1:1 education required • “Moderate” concern  hospitals have >10% but <20.01% errors • May submit additional information within 20 days • May request 1:1 educational session within 20 days • May submit additional information after 1:1 session within 10 days • “Major” concern hospitals have >20% errors • May submit additional information within 20 days • Must attend 1:1 educational session (required) • May submit additional information after 1:1 session within 10 days

18. Initial Review Results Letter

19. Initial Review Results Letter

20. Initial Review Results Letter

21. Education Process • Livanta’s 2M Nurse Educator will reach out to the QIO Liaison at the time of scheduling the education session • To ensure receipt of the letter • To entertain any questions about the process, and • To establish of line of communication • The QIO has 90 days from the completion of a hospital’s sample to supply provider education

22. Provider Education • Livanta conducted the first provider education sessions in early February 2016 • Livanta Medical Directors present the review findings on the preliminarily denied claims on a case-by-case basis • Hospital participation and feedback is expected and welcomed • The hospital has 10 days to respond with additional information after the 1:1 education session

23. Final Determination Letters

24. Final Determination Letters

25. Admission Denial Letters • After the Final Determination letter has been mailed to the provider, an Admission Denial letter is mailed for each denied claim to the beneficiary, the hospital, and the MAC

26. RAC Referrals • BFCC-QIOs shall rate and stratify providers for education and corrective action based upon the results of the completed claim reviews • BFCC-QIOs will refer to the Recovery Audit Contractor providers that consistently demonstrate a high denial rate • Failing to adhere to the Two Midnight rule • Failing to improve performance after BFCC-QIO educational intervention has been rendered • Referral to the RAC must be upon CMS direction

27. RAC Referral Process • Although the exact process for RAC referral is still being refined, it will involve the QIO discussing potential referrals with CMS and noting any extenuating circumstances • It is important to note that the timing of the education session and subsequent samples and reviews for a provider may necessitate several cycles of reviews before RAC referral is supported

28. Questions?

29. Case Review Examples Lamerial Danaiels, RN Redetermination Manager, Area 5

30. Denial Example • Case 1 – Syncope • This 75-year-old female was brought in by ambulance due to a syncopal episode. She had a history of vertigo, hypertension, and thyroid disease. The patient was admitted to observation status. • This admission did not meet the Two-Midnight Rule criteria because at the time of inpatient admission the patient’s condition had improved, and there was no anticipation of an additional midnight stay. Our physician reviewer concluded that there were no acute findings at the time of the emergency department evaluation and the patient went home the next day. There was no indication that the patient would need to stay 2 midnights.

31. Denial Example • Case 2 – Mental Status Changes • This 77-year-old male presented to the emergency department due to mental status changes. He had a history of stroke, transient ischemic attacks (TIAs), dementia, and a recent right neck mass biopsy. • This admission did not meet the Two-Midnight Rule criteria because the patient had no evidence of a stroke or TIA present on admission and he was admitted for a work-up to rule out a TIA. This diagnostic testing could have been provided at an observation level of care. Our physician reviewer concluded that the patient’s evaluation in the emergency department was unremarkable, and he was discharged the following day after his mental status was cleared.

32. Denial Example • Case 3 – Elective Procedure • This 82-year-old female was admitted electively for an anorectal examination under anesthesia and a rigid proctosigmoidoscopy. The patient had a history of diabetes and was recently diagnosed with a rectal mass found to be positive for adenocarcinoma. • This admission did not meet the Two-Midnight Rule criteria because the patient was admitted following an outpatient procedure with no documentation of complications or unstable comorbid conditions. The patient was discharged in less than 24 hours as expected. The procedure was not on the CMS inpatient only list.

33. Denial Rationale Examples • This admission did not meet the Two-Midnight Rule criteria because the treatment of pain control, IV hydration, monitoring of lab results, and a gastroenterology consultation did not require an inpatient admission and could have been done in observation status. • This admission did not meet the Two-Midnight Rule criteria because the patient was admitted to inpatient status following an outpatient surgical procedure with no documentation of complications or unstable comorbid conditions. The patient was discharged within 24 hours as expected. • This admission did not meet the Two-Midnight Rule criteria because the patient’s condition was improved prior to admission, and there was no indication that a 2 midnight stay was anticipated. The patient’s ongoing inpatient care for diagnostic testing and oral medications could have been provided at an outpatient level of care. • This admission did not meet the Two-Midnight Rule criteria because the patient’s care for mild CHF exacerbation without significant acute symptoms did not require an inpatient level of care. The patient’s care could have been provided at an observation level of care.

34. Good Documentation Example • A 72-year-old female patient presented on May 04, 2015 to have an implantable cardioverter defibrillator for severe ischemic cardiomyopathy. • The patient’s history included myocardial infarction, coronary artery disease, chronic systolic heart failure, hypercholesterolemia, multi-vessel coronary artery disease, status post diagonal vessel PCI in March as distal LAD balloon angioplasty pleural effusion, and chronic kidney disease, stage 3. • Her vital signs were: Temperature 98.3, blood pressure 121/84, heart rate 80, oxygen saturation 97% on 2 liters of oxygen. • The patient’s laboratory results were: white blood cells 9.8, hemoglobin 9, hematocrit 23, platelet count 172, sodium 133, potassium 4.4, blood urea nitrogen 127, and creatinine 2.32. • The original order for the patient was observation status however, the patient developed acute chronic systolic heart failure, anemia, and acute kidney injury post procedure and on May 6, 2015 at 0951, the patient was admitted to inpatient. • The patient was discharged on May 7, 2015. • This claim meets the guidelines for the Two-Midnight Rule.

35. Documentation Supporting Admission

36. Key Points for Education • Part A reimbursement is based on the continued need for acute hospital services for a second midnight • Document what happens between the first and second midnight to warrant continued acute hospital services • Documentation of reassessment at 18-30 hours after initial decision (observation or inpatient) helps us understand decision-making process • Patient status changes require documentation of the thought process for the change to support the decision

37. Livanta 2M Contacts • Website: Livanta.com or BFCCQIOarea5.com • Area 5 Helpline: 1-866-603-0970 • Area 1 Redetermination Manager: Lamerial Daniels ldaniels@livanta.com • UR/2M/Senior Program Director: Pam Applegate papplegate@livanta.com • Please feel free to contact us regarding status of your reviews and/or hospital contact updates

38. Questions?