Case Management

How to handle patients heading to a nursing home under the 2-midnight rule

Case Management Insider, November 3, 2015

It appears many case managers still have a lot of questions when it comes to 2-midnight rule compliance. We got the following question from one of our readers and asked two of our experts, Steven Greenspan, JD, LLM, vice president of regulatory affairs at Executive Health Resources in Newtown Square, Penn., and Kurt Hopfensperger, MD, JD, vice president of compliance and physician education for Executive Health Resources, to provide the answer.

Q. We have not been converting patients on observation status to inpatient status when they are staying two midnights if they need a nursing home placement due to a delay in getting a bed or insurance approval. Should we be converting these to inpatient if they are going to stay two midnights, especially if they need skilled care during their observation stay?

In the situation described, it appears the physician has already determined that the patient needs to be placed in a nursing home. This implies that the fundamental decision has also been made that this patient is not appropriate for an inpatient admission. According to CMS, the purpose of providing observation services is to determine whether a patient is appropriate for admission, or whether he or she is appropriate for discharge. In this case, since the physician has already determined the patient is not appropriate for an admission, the next question becomes whether he or she is appropriate for discharge. The overall decision here becomes trickier because you have also already determined that the patient is appropriate for discharge, although you are unable to effectuate the discharge due to a delay beyond your control. Based upon CMS guidance and regulations, neither inpatient nor observation seems appropriate in this instance. Should the patient be in need of skilled care during his or her stay, it would have to be provided to the patient as a hospital outpatient—not receiving observation services.

Got something you want to ask our experts? If you’ve got questions about the 2-midnight rule or any other case management topic, please e-mail them to Kelly Bilodeau at and we will have one of our experts answer it and will publish the response in an upcoming issue of Case Management Insider.

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