Health Information Management

AHA offers suggestions, concerns on CMS' NOTICE Act

HIM-HIPAA Insider, January 11, 2016

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CMS needs to evaluate, clarify, and modify sections of the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act, according to public comments made by the American Hospital Association (AHA). The NOTICE Act was signed into law August 2015 and will take effect August 2016.  CMS is currently preparing rulemaking to implement the law. The AHA supports the NOTICE Act’s goals of providing patients and their families with timely notification, both written and oral, about their status in the hospital, what inpatient observation is, and the reasons for and implications of that status, such as cost-sharing requirements and eligibility for skilled nursing facility coverage. However, the AHA also raises concerns about the implementation of the act and conflicts and confusion that may arise due to overlapping state laws. The AHA recommends revisions and clarifications be made on the following points:

  • Implementation timeline
  • Enforcement
  • Notification requirements
  • Timing of the notification
  • Oral explanation
  • Beneficiary signature requirement

Hospitals will need to change existing policies and procedures, update information systems, and provide education to staff. A six-month implementation period beginning after the law takes effect would allow hospitals the necessary time to make these changes, the AHA recommends. This would also allow CMS to provide clarification and detailed guidance to hospitals and MACs.

The act’s current notification requirements will include informing the patient of specific cost-sharing and coverage information. However, hospitals often do not know the exact cost-sharing and coverage information until after the patient has been discharged and the claim submitted, the AHA says. CMS should permit and make clear in the final rule that hospitals are allowed to use standard language about applicable Medicare outpatient policies regarding cost-sharing, the prohibition on coverage of self-administered drugs, and other relevant Medicare policies. Additionally, CMS should develop standard written templates for these notifications in simplified language, the AHA says.

The act currently states that if a patient refuses to sign the notification it must be signed and dated by the staff member who presented the written notification. This process should also be explicitly applied in other cases in which the patient is unable to sign due to their mental or medical condition, the AHA says.

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