COVID-19 Regulatory Update – 11/2021

November, 2021 

Ronald Hirsch, MD, ACPA Government Affairs Committee 

The COVID-19 Delta variant continues to overwhelm hospitals, with the majority of severe cases in the unvaccinated. A discussion about vaccination, mandates, ivermectin, and misinformation is outside the scope of this update, but acknowledging the physical and psychological effects of the pandemic on every person who works in our hospitals is crucial. As I write this, an ENT doctor in Texas had her hospital privileges suspended for spreading misinformation on Twitter about COVID-19 treatments and vaccines, although there were also reports she was trying to go into the rooms of “her patients” and administer ivermectin herself since the hospital employees would not do it. This week also saw the retraction of two highly cited papers, one linking vaccines and miscarriages and one touting the MATH+ treatment regimen. It is a shame that our colleagues have resorted to such unethical means to promote their personal agendas. (Opinion of author and not of ACPA or my employer.) 

Audits Resume

While CMS has released the auditors to resume, the overall volume has still not hit pre-pandemic levels. The Supplemental Medical Review Contractor recently released the results of an audit on claims billed with the COVID-19 diagnosis U07.1 and found a 1% error rate. You may recall that among the provisions adopted by CMS was that any admission with a COVID-19 diagnosis would get an added 20% payment. There was a significant number of rumors that hospitals were adding U07.1 to any patient simply to get the 20% payment and to inflate COVID-19 statistics. This audit result certainly demonstrates that hospitals were not gaming the system nor inflating the statistics. It should be noted that the admissions reviewed in this audit were prior to the added September 1, 2020 requirement that in order to report U07.1, a positive test result must be in the chart. Nonetheless, the SMRC did validate that if a doctor documented COVID-19, there was actual clinical evidence to support it. 

Waivers Extended

The COVID-19 waivers continue to be extended. The latest extension was issued October 18, 2021 and will expire on January 16, 2022. The expiration is automatic- the law only allows a public health emergency declaration to be issued for 90 days and then it automatically expires unless an extension is issued. Many of the rules issued during the pandemic talk of specific waivers expiring at the end of the calendar year when the public health emergency ends but that is not universal. We have already seen CMS rescind two waivers on SNFs concerning staff qualifications and patient rights. 

The waivers in place continue to include the SNF 3-day stay requirement waiver. We have heard from hospitals that SNFs continue to refuse patients under the waiver, not trusting CMS that they will get paid. As long as the SNF places the DR condition code on the claim, it should get paid. If it is not paid, it was a claim processing error by the MAC and a phone call should clear things up. But SNFs are well within their rights to refuse these patients. 

The waivers continue to allow non-rural or critical access hospitals to set up swing beds if they are unable to find an accepting SNF. You obviously have the option to keep the patient and certify the days as medically necessary inpatient days but you get no additional revenue until you hit outlier status. But if you create and use swing beds, you can get paid a daily rate for the rehabilitation care you will be providing. It takes some paperwork but then what doesn’t? Of course much of the current capacity issues are in hospitals so creating a swing bed may help financially but won’t help staffing. 

Hospital at Home 

The number of facilities developing hospital at home programs continues to grow and more payers are recognizing these as true “inpatient admissions” and paying accordingly. But it is a lot of work, a lot of coordination of many moving pieces, and a lot of documentation. It remains to be seen where “Hospital at Home” will land after the pandemic. Will CMS continue to pay full DRGs for patients treated at home? Will we have robust outcomes data to ensure patients are getting care of equal quality? And how will commercial insurers react? Will they see this shift as another reason to lower payments to hospitals as more patients can be safely treated outside the walls of the hospital? Time will tell.