To: GRRs
Re: New Two-Midnight Rule/Executive Summary
As a member benefit, we are pleased to provide the attached (and updated) Executive Summary of the Two Midnight Rule. Drafted by the AAMC and published by the American Health Lawyers Association (AHLA), the document also:
For More Information:
Executive Summary: The “Two-Midnight” Rule and the Impact on Teaching Hospitals
This updated version of "The 'Two-Midnight' Rule and the Impact on Teaching Hospitals," discusses the January 31 CMS announcement of a 6-month extension (through September 30) of the partial enforcement delay of the Two-Midnight Rule and the corollary “probe and educate” period. It also explains newly issued CMS sub-regulatory guidance regarding the order and certification requirements for inpatient admissions under the policy. This guidance clarifies how and when residents can write orders of inpatient admission.
The updates are incorporated into an original Executive Summary, which provided background on the new "Admission and Medical Review Criteria for Hospital Inpatient Services Under Medicare Part A," also known as the Two-Midnight Rule. In the FY 2014 IPPS Final Rule, CMS finalized the Two-Midnight Rule in an effort to address concerns about recovery audit contractor rejections of short stays and increases in the length of observation stays by establishing a bright-line rule. The Two-Midnight Rule establishes both a benchmark for physicians to determine appropriate inpatient admissions and a presumption for review contractors to guide which claims will be appropriate for Part A payment. Under this rule, only hospital stays that the physician expects will last two midnights or longer will be presumed appropriate inpatient admissions. Therefore, medically necessary stays that are not expected to cross two midnights will no longer be paid under Part A regardless of a patient's severity of illness or the intensity of care required.
The updated Executive Summary discusses implications of the benchmark, presumption, and new physician order and certification requirements. It also discusses the CMS sub-regulatory guidance and the extension of the partial enforcement delay through September 30. The Executive Summary highlights issues of concern to teaching hospitals as the rule is operationalized, including the effect of new physician certification requirements on residents admitting patients, reimbursement for stays less than two midnights, increased beneficiary liability for copayments and coinsurance, and the reduction in IPPS payments taken to offset expected shifts in utilization between inpatient and outpatient settings.