News to Note – June 2024

• The Centers for Medicare and Medicaid Services (CMS) released the proposed rules for inpatient rehabilitation facilities, inpatient psychiatric facilities, hospice, and skilled nursing facilities (SNFs) and there are a few things worth noting.  
• First, CMS is asking for comments on the hospice benefit and potential additional payment for high-cost palliative care services.  This could encompass services such as chemotherapy, radiation therapy, dialysis, and blood transfusions but only when used to treat symptoms and not as part of an active treatment for the patient’s terminal illness.  Of course, whenever additional payments are proposed, criteria will need to be carefully developed to ensure the purpose of the treatment is truly palliation and not with a curative intent or for financial reasons.  
• Does the SNF rule mention the three-day rule?  Unfortunately, no.  We all continue to hate it, and it’s likely CMS staffers do too, but it’s on Congress to fix it.  
• Patients covered by Medicare who are not admitted as Inpatient do not have formal discharge appeal rights.  But, one hospital asked why when a few of their patients in Outpatient status with Observation services called the Quality Improvement Organization (QIO) to appeal their discharge, the QIO contacted them and asked for copies of the medical record to review.
• How in the world did the patient know to call the QIO?   The QIO’s number is not on the Medicare Outpatient Observation Notice (MOON).  Did the patient receive the Important Message for Medicare (IM)?  Was someone the hospital taking a shortcut and getting signatures on every possible form, giving an IM and a MOON to every Medicare and Medicare Advantage patient who registered in the ED?  Of course, we know that is not only inappropriate but also not allowed.  Medicare does not allow you to deliver a form to a patient that is not appropriate for their situation.
• Putting that aside, what happened here?  Although the QIO cannot evaluate the patient as a formal discharge appeal, they do handle quality of care complaints.  As such, they would be obligated to assess the patient’s contention that they were being discharged prematurely.  Asking for records to review would be part of that determination. 
• What should you do if this happens in your facility?  The first thing to do is try to address the patient’s concerns.  Is the discharge premature?  Has your physician advisor looked at the case and determined discharge is appropriate?  If there are no issues, explain to the patient that they absolutely have the right to call the QIO but you have evaluated the situation and feel that discharge is appropriate.  Inform the patient that if they would like to stay they are welcome to do that but it won’t be free and they must immediately start paying your hourly rate for custodial care since there are no financial protections as there are with inpatient discharge appeals.  Since custodial care is statutorily non-covered, you do not have to present an Advance Beneficiary Notice (ABN) but you would be smart to do so to obtain proof that the patient understood their obligation.  Be sure the patient’s physician is aware of what’s happening and then wait for the QIO to call back.  If your physician has determined the patient does not require hospital care and the patient elects to stay in the hospital, be sure there are no IV fluids ordered, PRN IV medications, and no testing or imaging ordered. 
• In regard to National and Local Coverage Determinations (NCDs and LCDs), coverage for a procedure can vary amongst Medicare jurisdictions with each Medicare Administrative Contractor (MAC) developing their own coverage determination.  Recently, a physician advisor pointed out another nuance to this.  
• His hospital had started doing MRI-guided focused ultrasound surgery for treatment of essential tremor.  The procedure includes the word surgery, but there is no incision nor any device that enters the body, the patient is not even sedated for the procedure.  The device is FDA approved with labeling requiring that the physician performing the procedure be trained by the manufacturer on its use.  
• But, if you read the LCDs, two of the eight MACs have a requirement that physicians who perform this procedure must “possess expertise and experience in functional and stereotactic neurosurgery.”  The other six LCDs have no such requirement.  The problem is, they took this requirement from a guideline from the American Society for Stereotactic and Functional Neurosurgery and the guideline is not available to the public to know how it was developed.  The Society’s leadership is composed of neurosurgeons.  There is no board certification in stereotactic and functional neurosurgery although there are fellowships.  So, if this is not really surgery, and six of the eight MACs have no specific requirements for the physician, can a non-neurosurgeon who is properly trained by the manufacturer, perhaps a neurologist who treats movement disorders, perform this?  
• Ultimately, before clinicians in your hospital start performing a new procedure, or your hospital even spends money on the equipment, do your research on coverage, qualifications, and of course payment.  Otherwise, your next million-dollar purchase could be a really expensive doorstop.
• When does billing for Observation hours start?   When the order is written.  But, one hospital’s billing staff starts counting when the patient arrives in the “Observation bed”.  This is problematic as it results in undercounting and underbilling Observation hours.  Depending on how long it takes the patient to get to the “Observation bed,” if they get there at all, the hospital may be losing out on an Observation payment.  Compared to other hospitals, their observation hours per patient statistic likely looks absolutely fabulous compared to other hospitals.  But, is making a KPI look good or getting paid more the more advantageous situation?
• What do you do about patients covered by Medicare Advantage (MA) plans who are stuck in the hospital for days on end because no skilled nursing facilities in the area will accept them and the MA plan won’t approve a swing bed stay?  First, find out how your hospital is getting paid for Inpatient care by the MA plan.  If you are paid by any method other than Diagnosis-Related Groups (DRGs), a long stay like this might pay pretty darn well and keeping them hospitalized as Inpatient might not be so bad after all.  The bigger issue is that MA plans must meet strict network adequacy standards which includes SNF access within one hour.  If the MA plan cannot provide a SNF bed, it seems the plan should be reported to Medicare.  
• If you missed ACPA’s National Physician Advisor Conference (NPAC) last month in Coronado, CA, here is a recap:
• Dr. Robert Leviton from New York gave a great talk about his health system’s process for peer-to-peers with insurers.  He has a great system to collate all the information and track the results.  
• When he asked the audience about their familiarity with the documentation changes that came with the evaluation and management (E&M) update for hospital visits in 2023 and very few in the audience were aware.  The changes mean no more requirement for documenting a full physical exam that in most cases, was never actually done, nor a full review of systems that in most cases, was never really asked.  The visit code is now based on documentation of the physician’s medical decision-making.  The American Medical Association (AMA) and CMS handed physicians a gift last year.  We encourage all of you to look at your physicians’ notes.  If you see a review of systems, find your medical records physician champion and demand they educate the doctors on the new E&M rules.
• On the other hand…coding expert Betsy Nicoletti and Dr. Robert Oubre pointed out that educating clinicians about the new E&M rules may not be as simple as it seems. Many hospitals have provisions in their medical staff rules that outline required elements in a History and Physical examination.  Hospitals added these provisions years ago in response to accreditation surveyors who would come into the operating room, pull a random chart, and cite the hospital because the ophthalmologist doing a cataract extraction did not document if the patient was asked about the number of times they wake up to urinate.  So, before you tell your doctors to stop documenting the review of systems, check with your medical staff office and work to get the medical staff rules changed. 
• Many of the presentations at NPAC were related to Medicare Advantage plans.  Drs. Edward P. Hu and Christopher Caulfield from UNC Health went into depth about their process for appealing Medicare Advantage denials and filing complaints against MA plan abuses.  
• First, it’s important that complaints not be frivolous.  Don’t complain your doctor documented “I expect two midnights” on a patient with chest pain and the MA plan refused to approve inpatient admission.  If you have a solid two-midnight Inpatient case or an Inpatient-only surgery and the MA plan medical director states that Two-Midnight Rule provisions do not apply to them, then a complaint is warranted.  Dr. Hu recommended sending the complaint to the CMS regional office and requesting they acknowledge receiving the complaint by sending you the Complaint Tracking Module ID# that was assigned to the case.  Send the complaint to the CMS regional office in two e-mails: the first with a password-protected document that includes the clinical information and violation without medical records; the second consisting of the password for the document.  CMS will not open emails that are encrypted by your email system so you must use the two e-mail system – ask your IT department for help.  
• Why take the time to file these complaints?  Because CMS tracks formal complaints and a lot of complaints can significantly affect an MA plan’s quality bonus. 
• CMS recently released a rules addressing nursing homes and sets specific staffing ratios for nursing, mandaing a total nurse staffing standard of 3.48 hours per resident per day including at least 0.55 hours of care per resident of care by registered nurses and 2.45 hours per resident per day by nurse aides in addition to a requirement for at least one registered nurse to be onsite 24 hours a day.  
• There are reporting requirements and some flexibilities for rural areas.  This rule received almost 47,000 comments which is a crazy high number under normal circumstances.  By comparison, CMS-4201-F, our new favorite rule that requires MA plans to follow the Two-Midnight Rule, received less than a thousand comments.  
• We likely all support CMS’ intent to improve the care of nursing home residents and more nursing care certainly will lead to better care.  But, would these new requirements lead some owners to determine the requirements too onerous, especially with the staffing shortages many are seeing, and start closing facilities?  That is certainly not the outcome anyone would want.
• QIO Acentra – formerly known as Kepro – announced that hospitals are not required to update their Important Message from Medicare (IM) forms to include their new name.  As such, forms with “Kepro” as the QIO instead of “Acentra” will be accepted until December 2025, when the current IM version expires. 
• Acentra is also changing up their discharge appeal process.  When a traditional Medicare patient calls to appeal their discharge, Acentra will screen the call and determine if the patient’s concern is with the discharge or the discharge planning.  If it is the discharge planning, instead of starting a formal appeal, they will initiate an “immediate advocacy process” involving joining the patient and hospital representative on a call to try and resolve any misunderstanding.  Acentra has not explained who will be moderating these calls, what standards they will be using, or what will happen if a patient calls in the evening or on a weekend or holiday.  While this has the potential to avoid some appeals, it also may stretch out the actual appeal process even longer, meaning more patients in hospital beds who do not require hospital care.  ACPA Update Editor, Dr. Ronald Hirsch, is checking with CMS to see if this plan is even permitted.  The discharge appeal process is highly regulated and it’s important to know if CMS has authorized it since it places significant obligations on hospitals.
• Last month in ICD10Monitor.com eNews, ACPA CDI Committee Chair, Dr. Erica Remer, wrote answers to some of the questions she received at NPAC.  One question was about assessing the financial impact of CCs and MCCs on reimbursement.  Dr. Remer referred to using a DRG’s relative weight and the hospital’s blended base rate.  While that will provide some measure of the financial effect and it would be easy to use the CMS DRG table to pre-populate every estimated value, another option is using Medicare’s Web Pricer tool.  
• The Web Pricer tool includes calculations for Inpatient admissions but also for Inpatient Rehabilitation, Skilled Nursing Facilities, Hospice, and more.  Using the hospital’s provider number and the DRGs in question, you can see the actual expected reimbursement and see the true value of the DRG change. 
• If you look closely at the results of an inquiry, you will see that the total payment for each Inpatient admission consists of not only payment for the admission, but also the many add-on payments such as indirect medical education, disproportionate share payment, any deductions for readmissions or value-based payment performance, and so on.  For example, running the numbers for a community hospital in Georgia and an MCC on a heart failure admission results in an additional $5,400 in payment.  But, for a teaching hospital in California, it results in $11,000 more in payment.  As always, securing complete and accurate documentation in the medical record is part of providing great patient care – if more money follows, so be it. 
• Since January 1^st of this year, the Medicare Inpatient-Only list applies to every MA plan.  A recent online discussion detailed a hospital which realized in April that for the last three months, one of their MA plans was not approving Inpatient admissions for these surgeries.  As a result, they performed them as Outpatient and were paid outpatient rates.  When the hospital realized the error, they wondered if they could contact the MA plan and demand Inpatient payments for the Inpatient-Only surgeries done in 2024.  However, none of these surgeries had an Inpatient admission order.  The MA plan was wrong to approve them as outpatient, but the hospital did not push back and submitted Outpatient claims for these cases.  Trying to correct the claims and insist the MA plan pay Inpatient rates without an Inpatient order simply won’t work.  The lesson here?  Keep up with ACPA Update and News to Note and ensure you stay up-to-date on the regulatory changes that matter.
• A recent Report on Medicare Compliance article by Nina Youngstrom discussed a hospital that discovered they were paying physician medical directors for hours where the physician was not actually providing administrative duties.  If the physicians are still practicing clinically, that payment could be considered a Stark Law violation.  Some hospitals use medical directorships as a way to reward physicians for their loyalty and that’s fine as long as actual work is performed.  While it would be the hospital that would get in legal trouble and not the physician, if you are a physician advisor who does not serve in the administrative role full-time, be sure you are tracking your hours and specifying what work you are accomplishing.
• It was recently noted that one prominent, national payer is paying for Inpatient hospitalizations to critical access hospitals (CAHs) for four days of care even if the stay exceeds that time frame and if the care was medically necessary.  The payor notes that since CAH Inpatients are expected to remain hospitalized at the facility for under 96 hours, that’s the only length of time which should be paid.  Interestingly, during the COVID-19 Public Health Emergency (PHE), this payer stopped the practice because CMS waived the CAH 96-hour rule.  However, the payor is now recouping payment from these hospitals for admissions which took place after the PHE ended.  If you have a CAH in your system, it’s time to check your claims and see if any payor made unexpected adjustments or recoupments.
• Consider this scenario involving a patient transferring from one hospital to another:
• The patient spends two midnights at the first acute care hospital.
• At the second acute care hospital, an Inpatient order is not entered until the day after the patient arrived.
• The patient discharges from the second acute care hospital after two midnights pass, there.
• Will there be an issue with Medicare Part A SNF coverage?
• The answer is, yes.  While Inpatient billing is appropriate per the Medicare Two-Midnight Rule, there are not three, consecutive Inpatient midnights to fulfil the Part A SNF benefit requirement.  This is because midnights #1 and #2 at the first hospital were Inpatient, midnight #3 at the second hospital was Outpatient (since no status order was entered), and midnight #4 was Inpatient.  Yes, there were four midnights involved for a patient who discharged in Inpatient status, but three of the midnights were not consecutive.  
• Speaking of hospital-to-hospital transfers, how are the hospitals paid?  Many incorrectly think the DRG payment is split evenly between the two, or split depending on how much time the patient spent at each facility.  In reality, depending on the DRG and geometric mean length of stay involved, the transferring hospital may receive a reduced payment but the accepting hospital will always get paid the full DRG.  Make sure you correct anyone who says otherwise!