Report on Medicare Compliance: PAs: Admission Screening Tools, LOC Reviews Are Unnecessary

Report on Medicare Compliance Volume 27, Number 5 • February 5, 2018

Copyright © 2018 by the Health Care Compliance

Association (HCCA). This article, published in Report on Medicare Compliance, appears here with permission from the HCCA.


PAs: Admission Screening Tools, LOC Reviews Are Unnecessary

Some hospitals are having a hard time letting go of admission screening tools, but they add very little value for Medicare fee-for-service patients under the two-midnight rule and may have a compliance backlash, some compliance experts say. When time receiving hospital services became the determining factor for Part A coverage of medically necessary inpatient admissions under the two-midnight rule, admission screening tools lost their usefulness, as CMS explained in the 2014 inpatient prospective payment system regulation that implemented the two-midnight rule and subsequent guidance, they say.

But admission screening tools, such as InterQual and MCG (formerly Milliman), “are so ingrained into utilization review it’s almost like we can’t imagine living without them,” says Joseph Zebrowitz, M.D., co-chief executive officer of Versalus Health in Newtown Square, Pa. Some hospitals also think the Medicare conditions of participation require 100% review of inpatient admissions as part of the utilization review (UR) process, but that’s not true either, they say. “The conditions of participation state that the UR

process may be performed through sampling,” Zebrowitz says (see 42 CFR 482.30(c)(3)). He says 100% admission reviews only are required for outlier cases—day outliers with a length of stay greater than 20 days and cost outliers (see paragraph e of 42 CFR 482.30(c)(3)).

These two “false beliefs” are wasting compliance and UR resources, adds Tom McCarter, M.D., executive vice president and chief medical officer of Versalus Health.

Under the two-midnight rule, Medicare Part A generally pays for hospital stays that cross two midnights, even if patients started in observation or the emergency room. CMS in the 2016 outpatient prospective payment system regulation carved out a case-by-case exception for shorter hospital stays if the physician supports their medical necessity, although the shorter stays will be subject to medical review (RMC 11/9/15, p. 1). Level-of-Care Reviews Aren’t Required There isn’t a requirement for hospitals to review level of care (inpatient vs. outpatient/observation) at all, Zebrowitz and McCarter say. While hospitals have to ensure the medical necessity of hospital care, the level-of-care construct went out the window altogether with the two-midnight rule, along with admission screening tools for fee-for-service Medicare, Zebrowitz and McCarter say, although they don’t want you to take their word for it. In the 2014 inpatient prospective payment system rule, CMS said beneficiaries don’t have to meet an inpatient level of care “as may be defined by a commercial screening tool.” This was reiterated by CMS in its March 12, 2014, guidance on “Reviewing Hospital Claims for Patient Status: Admissions On or After October 1, 2013,” which stated that “meeting an inpatient ‘level of care,’ as may be defined by a commercial screening tool, does not make Part A payment appropriate in the absence of an expected length of stay of 2 or more midnights.” That’s why Zebrowitz and McCarter ask hospitals to consider why they spend resources—and case managers are expensive registered nurses—on level of care reviews and admission screening tools when they’re not necessary and case management has so many other priorities. In fact, using admission screening tools superfluously may lead hospitals to denials, Zebrowitz and McCarter say. Hospitals that mistakenly believed that the case-by-case exception is essentially a return to life before the two-midnight rule might think admission screening tools should play a role, but they would be wrong, McCarter says. McCarter points to an example from a CMS presentation on the two-midnight rule to show how level of care doesn’t drive the admission decision and could lead to noncompliance. “A 73-year-old male with an accidental environmental toxic exposure presents to the [emergency department]. Poison control recommends placing the patient in the ICU due to the potential for emergent intubation, and telemetry monitoring. MD requests transfer to ICU for telemetry monitoring, but it is unsure if the patient will need medically necessary care/services for 2 or more midnights. The patient is watched overnight and dis-charged the following day. Although this patient is receiving Intensive Care services at an ICU level of care, CMS has indicated that this patient is appropriate for Part B billing.” Before the two-midnight rule, an ICU patient would be appropriate for inpatient admission, Mc-Carter says. “After the two-midnight rule, CMS has made it clear that level of care is no longer dispositive, but rather it is the expectation of the need for hospital services over two midnights that determines appropriateness for Inpatient Part A payment.”

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