CMS proposes changes to the two-midnight rule: 5 things to know

In a proposed rule posted Wednesday, CMS announced it plans to make modifications to the controversial two-midnight rule.

Under the two-midnight rule, CMS generally considers hospital stays of less than two midnights to be outpatient cases, while hospital admissions for stays spanning two midnights or longer are deemed appropriate.

CMS' changes to the two-midnight rule were outlined in its 2016 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System proposed payment rule.

Here are five things to know about the changes CMS has proposed for the two-midnight rule.

1. Under the proposed rule, certain stays that are less than two midnights would be payable under Medicare Part A. According to the proposed rule, "an inpatient admission would be payable under Medicare Part A on a case-by-case basis based on the judgment of the admitting physician."

2. For hospital stays that are expected to span less than two-midnights to be payable under Medicare Part A, documentation in a patient's medical record must support that an inpatient admission is necessary. For an admission to be payable under Part A the documentation in the medical record must support either the admitting physician's reasonable expectation a patient will require hospital care spanning at least 2 midnights or the physician's determination that the patient requires formal admission to the hospital on an inpatient basis.

3. In the proposed rule, CMS said it plans to "prioritize these types of cases for medical review."

4. CMS made no changes to its policy regarding hospital stays that are expected to be two midnights or longer in the proposed rule.

5. CMS said it attempted to balance multiple goals in the proposed rule, including respecting the judgment of physicians and providing clear guidelines for hospitals and physicians.

To view the full 2016 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System proposed payment rule, click here.

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