News & Analysis as of

Two-Midnight Rule

Health Care Compliance Association (HCCA)

Early returns on MA plans’ two-midnight rule interpretations: A compliance nightmare

The Centers for Medicare and Medicaid Services (CMS) issued regulations applicable to Medicare Advantage (MA) plans—also commonly referred to as managed Medicare or Part C Medicare—in April 2023 (CMS 4201–F) that address,...more

King & Spalding

OIG Report Details Weaknesses in Enforcement of Two-Midnight Rule

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CMS estimates that between 2017 and 2021, Medicare Part A improperly paid $23.9 billion for inpatient hospital stays, with $7.8 billion attributable to short stays that did not qualify for Medicare Part A. On June 13, 2024,...more

Stevens & Lee

CMS Final Rule: Medicare Advantage Plans Subject to Two-Midnight Coverage Condition

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On June 5, 2023, CMS’s Final Rule regarding, among other things, “Technical Changes to the Medicare Advantage Program” will become effective – refer to the CMS Fact Sheet and the Final Rule as published in the Federal...more

King & Spalding

New Medicare Advantage Regulations Add Provider and Beneficiary Protections Against Plan Utilization Management Policies

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On April 5, 2023, the Centers for Medicare & Medicaid Services (CMS) issued a Final Rule (CMS-4201-F) regarding the Medicare Advantage (MA) and Part D programs. The Final Rule includes changes related to various aspects of...more

Health Care Compliance Association (HCCA)

MA Final Rule: CMS Requires Two-Midnight Rule, Puts Limits on Internal Coverage Criteria

In what passes for neon lights in the regulatory world, CMS said Medicare Advantage (MA) plans must follow the two-midnight rule, its case-by-case exception and the inpatient-only (IPO) list, according to the final 2024 rule...more

King & Spalding

Court of Appeals Affirms Ruling that Hospital Utilization Review Committee’s Medicare Part A Inpatient Reclassifications Trigger...

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On January 25, 2022, the U.S. Court of Appeals for the Second Circuit affirmed a lower court ruling that the Secretary of HHS violated the due process rights of Medicare beneficiaries by failing to provide an administrative...more

King & Spalding

OIG Announces Resumption of Medicare Inpatient Short Stay Audits

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In its November 2020 Work Plan update, OIG announced it will begin auditing short stay inpatient hospital claims under the Two Midnight Rule, and when appropriate, recommend overpayment collections. OIG does not specify the...more

Hogan Lovells

FCA Alert: Decision Opens Door to Challenge of Agency Guidance in False Claims Cases

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On November 5, 2019, the United States District Court for the Eastern District of Pennsylvania ruled on a motion to dismiss a False Claims Act (FCA) qui tam suit filed by the United States Department of Justice, long after it...more

Mintz - Health Care Viewpoints

DOJ Seeks Dismissal of FCA Qui Tam Case to Escape Onerous Discovery Obligations

On August 20, 2019, the United States exercised its authority under the False Claims Act (FCA) to seek dismissal of a relator’s qui tam suit because of the defendant’s burdensome discovery demands, in Polansky v. Executive...more

King & Spalding

How Payers Are Improperly Underpaying Inpatient Services As Observation Services

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Health plans and their delegated IPAs are using a number of different tactics to deny payment for inpatient services by improperly classifying inpatient claims as observation or other types of outpatient status. Payers are...more

Morgan Lewis

CMS Forges Ahead with Price Transparency, Major Payment Reductions in Proposed OPPS Rule

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The Centers for Medicare and Medicaid Services’ proposed outpatient prospective payment system rule contains a number of significant changes and proposals impacting hospital operations and payments in calendar year 2020,...more

Polsinelli

CMS Takes Bold Action on Price Transparency & Physician Supervision in CY 2020 OPPS Proposed Rule

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On July 29, 2019, the Centers for Medicare & Medicaid Services (“CMS”) released the CY 2020 Hospital Outpatient Prospective Payment Systems (“OPPS”) proposed rule [CMS-1717-P]. ...more

King & Spalding

CMS Temporarily Pauses QIO Short Stay and Higher Weighted Diagnosis-Related Group Review

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Effective May 8, 2019, CMS temporarily suspended Beneficiary and Family Centered Care Quality Improvement Organization (BFCC-QIO) Short Stay reviews and Higher Weighted Diagnosis-Related Group (HWDRG) reviews. Reviews will be...more

King & Spalding

HHS Argues It Cannot Be Sued by Patients for Hospitals’ Admission Decisions

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n a motion filed last week in Alexander v. Azar, No. 3:11-cv-1703-MPS (D. Conn.), HHS argued that it cannot be sued by Medicare beneficiaries objecting to a hospital’s decision to admit them as inpatients instead of placing...more

King & Spalding

CMS Releases, Then Withdraws, Additional Guidance Regarding Application of Two-Midnight Rule to Total Knee Arthroplasties

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On January 8, 2019, almost exactly a year after CMS removed total knee arthroplasties from the Medicare Inpatient-Only List, CMS released additional guidance regarding the application of the Two-Midnight Rule to these cases. ...more

Baker Donelson

CMS Softens Physician Inpatient Order Documentation Requirement

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Effective for hospital inpatient admissions on or after October 1, 2018, CMS has removed the requirement that a signed physician order must be present in the medical record to establish inpatient coverage. While this guidance...more

King & Spalding

Texas Health System Pays Nearly $2 Million To Settle Allegations of Improper Billing for Inpatient Services

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On May 14, 2018, the U.S. Attorney’s Office for the Southern District of Texas announced that Memorial Hermann Health System (MHHS) will pay $1,929,071.38 to resolve allegations that it improperly billed government healthcare...more

Bricker Graydon LLP

CMS proposes to eliminate requirement for written inpatient admission orders

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On April 24, 2018, the Centers for Medicare and Medicaid Services (CMS) published the 2019 Medicare Inpatient Prospective Payment System proposed rule (2019 Proposed IPPS Rule), which contains a number of proposals designed...more

King & Spalding

CMS Proposes Changes to Inpatient Admission Orders in 2019 IPPS Proposed Rule

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On April 24, 2018, the Centers for Medicare & Medicaid Services (CMS) released the Fiscal Year (FY) 2019 Inpatient Prospective Payment System (IPPS) Proposed Rule (CMS-1694-P). Among other changes, CMS proposes eliminating...more

King & Spalding

Iowa Hospital Settles False Claims Act Case for Inpatient Claims Submitted Under the Two Midnight Rule

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Genesis Medical Center in Davenport, Iowa has reached a settlement with the Department of Justice related to improper hospital admissions from January 1, 2013 to December 31, 2016. According to the DOJ, Genesis “improperly...more

King & Spalding

CMS Announces Expansion of Targeted Probe and Educate Medical Review Strategy

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On August 14, 2017, CMS announced an expansion of a Targeted Probe and Educate (TPE) review strategy for Medicare Administrative Contractors (MAC) reviews. Many providers were familiar with Probe and Educate reviews in...more

King & Spalding

CMS Updates the Medicare Program Integrity Manual to Reflect Patient Status Reviews Under the Two Midnight Rule

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Although the Two Midnight Rule became effective on October 1, 2013, CMS had not updated manual guidance to incorporate the Two Midnight Rule until recently. The CMS updated the Medicare Benefit Policy Manual earlier this...more

Baker Donelson

Medicare Two-Midnight Rule and Observation Status Updates

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What's new from Medicare in the areas of the Two-Midnight rule and observation services? CMS recently published updates to a Medicare manual reflecting clarifications to its Two-Midnight policy, a Medicare Quality Improvement...more

King & Spalding

CMS Updates Manual Guidance to Include References to the Two Midnight Rule

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Although the Two Midnight Rule was effective October 1, 2013, until recently, CMS had not updated the Medicare Benefit Policy Manual (MBPM) to incorporate the Two Midnight Rule and its revisions to prior admission...more

King & Spalding

HHS OIG Issues Report on Medicare’s 2-Midnight Rule

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On December 19, 2016, the HHS OIG issued a report on Medicare’s 2-midnight rule titled “Vulnerabilities Remain Under Medicare 2-Midnight Hospital Policy.” The report reviews data from 2013 and 2014 and reaches several...more

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