When CMS published the Inpatient Prospective Payment System Final Rule for 2014, the two-midnight rule regulatory revisions were included for clarification to hospitals regarding Medicare inpatient status.
In the detailed words of the rule, "We (CMS) provided hospital inpatient admission guidance specifying that a physician, or other qualified practitioner, should order inpatient admission if he or she expects that the beneficiary's length of stay will exceed a two-midnight benchmark, or if the beneficiary requires a procedure specified as 'inpatient-only' under § 419.22 (Page 50944, 2014 IPPS Final Rule)." According to CMS, the two-midnight rule was not a change to inpatient criteria: "Our (CMS) proposed two-midnight benchmark … simply modifies our previous guidance to specify that the relevant 24 hours are those encompassed by two midnights (Page 50945,2014 IPPS Rule)."
Tift Regional Medical Center, a not-for-profit hospital system in Tifton, Ga., serving 12 counties in South Central Georgia, understood that the release of the final rule in late August left little time to operationalize the new determinants for meeting the inpatient criteria. The hospital's leaders realized that they needed help understanding the implications of the two-midnight rule for a system of their size. They turned to Nashville-based Xtend Healthcare, and Linda Corley, Xtend's vice president of compliance, for advice on ways to improve documentation to meet the changes to physician order and length-of-stay attestation requirements, and for help with training physicians, patient care management staff and other clinical staff members on the procedures needed in place by the Oct. 1, 2013, deadline.
TRMC and Xtend work together to tackle the two-midnight rule
TRMC and Xtend already had a well-established relationship. For more than a decade, Corley had worked with the hospital's Patient Financial Services Department in a variety of areas related to revenue cycle process improvement, from billing compliance to HIM, CDM, auditing and reimbursement. She also had worked closely with TRMC's revenue cycle team to help the hospital comply with various regulatory changes affecting both inpatients and outpatients.
When the two-midnight rule was published, Corley was already working with Mary Perlis, RN, TRMC's case management director, to put in place a medical record review process for short-stay patients to ensure appropriate documentation and billing. In reviewing the new rule, Perlis and Corley concluded that compliance would require changes in several of the hospital's clinical processes.
"We immediately began reviewing our electronic record to specify the physician order wording for 'admission to inpatient' services, and we added a sentence calling for the physician to attest to the patient requiring care for greater than two midnights, depending on evaluation of the patient," Perlis said. "The key for us was including physicians, as well as case management and utilization review staff in the same explanatory process of the rule and of our plan to meet the changed inpatient requirements while maintaining quality patient care."
Since all users were able to offer input into the revision of the EMR, noted Perlis, it has served well to meet the needs for more specific documentation.
Perlis also consulted Patient Financial Services to understand the two-midnight rule's instructions for consideration of the time a patient had already received services in an outpatient area (e.g., emergency or diagnostic services, and observation). Through revising system-posted account service notes and understanding the time stamping of registration in various service areas, Corley helped TRMC's case managers accurately estimate the length of time Medicare patients had been receiving outpatient services prior to the physician's inpatient order.
Since the new rule allows inclusion of outpatient service time in the facility or a clinic in meeting the two-midnight benchmark, Perlis noted that the benefit of enabling TRMC emergency department physicians to discuss prior patient care time with an assigned clinical nurse manager to arrive at the total time of medical care. As a result, physicians were promptly advised of the remaining length of stay the patient would need in order to meet the two-midnight inpatient criteria.
Engaging the hospital staff to help meet all rule requirements
It was also important for Perlis and Corley to address training for patient care managers. To meet Medicare inpatient status requirements, as they evaluated patients these managers would have to switch from the long-established InterQual or Milliman clinical assessment tools, which are based on patient acuity and intensity of services, to the physician's evaluation and plan for the patient that indicated the need for care beyond the two midnights threshold.
"This is still a difficult obstacle for clinical nurse managers to understand," Perlis says. "For CMS to change completely to time-based criteria seems the direct opposite of the way we for many years have reviewed clinical symptoms and specific patient care needs to determine status."
In addition, as required by the rule, while the two midnights of care form the primary need for classification as an inpatient, the patient's medical condition must be sufficiently documented to warrant the plan of care. Corley provided a web-ex to TRMC's patient care management team. During the session she helped educate the team about documentation requirements for an inpatient admission under the new rule, and showed them various examples of regulatory-compliant accounting of the duration of time that patients received outpatient care before physicians issued orders for inpatient admission.
It was important to Perlis for the staff to understand that the CMS definition of medical necessity is still a component of inpatient criteria, even after the physician establishes that the patient's need for services will likely cross two midnights in the facility.
The challenges of the two-midnight rule
According to Perlis, one of the most difficult areas of the two-midnight rule to put into consistent practice has involved the precise timing for upgrading a patient from "observation" to "inpatient" status. A physician, based on continued patient evaluation, may conclude that the patient cannot be safely discharged home after the initial 24 hours of observation. Nevertheless, based on the examples provided by CMS, the Medicare patient should be admitted as an inpatient to receive continued medical services.
Corley reviewed these examples with both CMS staff members and TRMC hospitalists to identify a clear path for decision-making that complies with the rule. Determining appropriate patient status for observation patients, noted Perlis, may require hospitals to establish an ongoing review of patient documentation and physician-ordered diagnostic and therapeutic services to adequately evaluate the expected length of stay.
Perlis acknowledges that TRMC inpatient admission procedures continue to require additional staff members and time to ensure the two-midnight rule is followed.
"We continue to audit admission procedures and documentation, and our focus remains on performance improvement in meeting the challenges of the rule," says Perlis. "We have identified our areas of strength as well as the areas in which we struggle. One surprising development (or maybe not so surprising) is that, at any point within the process that may carry over to several days and to various physicians and case managers, it's our communication of patient information that is crucial to two-midnight rule success."