Your Medicare coverage is hugely influenced by something called ‘the two-midnight rule.’ Here’s what that is

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When a clinician admits a Medicare beneficiary for inpatient care, their prime whitethorn person been influenced by a Centers for Medicare and Medicaid Services (CMS) modular that sounds for illustration a word from a spy novel: nan two-midnight rule.

The two-midnight norm is utilized erstwhile a clinician believes that a Medicare beneficiary needs infirmary attraction that will apt eclipse 2 midnights—requiring inpatient attraction alternatively of cheaper outpatient care, Regan Tankersley, an lawyer astatine nan rule patient Hall Render who advises healthcare systems, told Healthcare Brew.

“It’s a much costly setting, it’s much costly care, and truthful it costs much for nan payer,” she said.

CMS first implemented nan two-midnight norm successful 2013 to supply hospitals pinch a benchmark connected what types of attraction suffice for Part A coverage, meaning nan insurer afloat covers curen costs for services, specified arsenic infirmary inpatient attraction aliases clip successful a skilled nursing facility. Under Part B coverage, which includes outpatient services, nan insurer pays a little percent of those costs, usually 80%, according to Medicare.

By mischaracterizing sum nether Part A, a supplier could overcharge nan insurer for treatments, according to Tankersley. Before nan rulemaking clarified what sum could suffice nether Part A, CMS auditors recovered inconsistencies successful aesculapian claims nan agency received from hospitals.

“[T]hrough nan Recovery Audit program, CMS identified precocious rates of correction for infirmary services rendered successful a medically unnecessary mounting (i.e., inpatient alternatively than outpatient),” a 2015 CMS fact sheet stated.

According to 1 2016 Office of nan Inspector General for nan Department of Health and Human Services (HHS-OIG) report, Medicare whitethorn person paid astir $3 cardinal successful short inpatient stays wrongly categorized nether Part A successful 2014.

On nan different hand, mischaracterizing sum arsenic Part B could forestall patients from accessing sum for definite services, specified arsenic admittance to a skilled nursing facility, according to nan report.

“It took immoderate of nan guesswork distant for hospitals arsenic to erstwhile they should admit patients,” Tankersley said.

The norm cleared distant “fear” connected nan supplier broadside that “we admit them because we deliberation they’re sick enough, and past Medicare aliases an auditor comes backmost and says, ‘No, we deliberation they should person been an outpatient,’ and past they recoup that payment,’” she added.

Enrollment successful Medicare Advantage (MA), a programme done which backstage insurers statement pinch Medicare to supply coverage, has grown to much than 30 cardinal members, up from 14.4 cardinal members, erstwhile nan two-midnight norm took effect, according to KFF. Last June, CMS and HHS added a new rule to nan Federal Register: MA scheme providers must travel nan two-midnight costs structure, too.

“A batch of Medicare Advantage plans aliases commercialized plans person a pre-authorization [for inpatient admission],” Tankersley said. Before nan rule, MA plans mightiness “come backmost and say, ‘No, we’re not going to fto this beryllium admitted.’ And past you’re backmost into this outpatient bucket and services.”

This article was initially published by Healthcare Brew, a branch of Morning Brew.

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