Health Information Management

CMS continues packaging, tweaks 2-midnight rule in 2016 OPPS final rule

HIM-HIPAA Insider, July 6, 2015

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By Steven Andrews

CMS is sharply accelerating its push toward moving outpatient payments from a fee-for-service model to a true prospective payment system with a number of its proposals in the 2016 OPPS proposed rule, including new comprehensive Ambulatory Payment Classifications (C-APC) and extensive APC consolidation and reconfiguration. The proposal would also modify the 2-midnight rule and shift enforcement of the rule to Quality Improvement Organizations (QIO).
“The rule is deceptively short at less than 700 pages, but it packs a punch with a number of new proposals that providers need to review carefully in order to determine both financial and operational impact,” says Jugna Shah, MPH, president and founder of Nimitt Consulting, based in Washington, D.C., and Spicer, Minnesota.
“What’s clear is that CMS is moving full steam ahead with carrying out the Department of Health and Human Services Secretary’s goal of tying more Medicare payments to quality and value by the end of 2016 and 2018, which includes looking at bundled payments, episodes, and alternate payment models,” Shah says. “The 2016 OPPS proposed rule includes a number of proposals that clearly move us in the direction of larger and larger bundles of services.”
2-midnight rule review shifts to QIOs
CMS introduced no changes to the 2-midnight rule in the 2016 IPPS proposed rule but acknowledged plans to address it in the OPPS rule. The agency followed through by proposing changes for stays expected to last less than two midnights.
CMS proposes that for stays a physician expects to last less than two midnights, an inpatient admission would be acceptable on a case-by-case basis, depending on the judgment of the physician and the documentation justifying the stay. CMS expects short stays for minor surgical procedures or hospital care to be rare and will monitor these types of admissions to prioritize them for medical review. 
Responsibility for educating physicians and enforcing the 2-midnight rule will shift to QIOs from Recovery Auditors, according to the proposed rule. This appears to be a positive change, as the QIOs are likely better equipped than Recovery Auditors to conduct these reviews, but providers will know more once CMS releases information about the medical review strategy, says Shah.
Commenting on the rule
Providers should certainly take a deep dive into the rule after the holiday weekend in order to prepare comments for submission to CMS, according to Shah.
“CMS has taken a sharp right turn toward creating larger and larger bundles of services, introducing more nuances to OPPS, and proposing to embark on a data collection effort to better understand services that might be related to C-APCs but billed on a separate claim,” she says.
“This is all in the spirit of making the OPPS more of a true prospective payment system, so now is the time to perform analysis of the impact of these changes and to weigh in to CMS on these significant proposals.”
CMS will accept comments on the proposed rule until August 31, 2015, and will respond to comments in a final rule to be issued on or around November 1, 2014. The proposed rule will appear in the July 8 issue of the Federal Register.
Read the full story by Steven Andrews here on the HCPro website.

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