Experts Advise Hospitals: Don’t Drown in the Details of Medicare’s Two-Midnight Rule

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Compliance experts give advice to hospitals in the wake of last week’s announcement of a deadline delay for Medicare two-midnight rule audits, in the Feb. 10 issue of Atlantic Information Services’s Report on Medicare Compliance.

In a move designed to alleviate concerns hospitals have about Medicare’s two-midnight rule for inpatient admissions, the Centers for Medicare and Medicaid Services announced last week another delay of recovery audit contractor (RAC) audits under the rule. Hospitals now have until Oct. 1, 2014, to absorb changes to the physician certification requirement before RAC audits go into effect. The Feb. 10 issue of Atlantic Information Services, Inc.’s (AIS) Report on Medicare Compliance offers full analysis of the policy announcement, including expert advice from compliance experts.

Because the two-midnight rule is a radical change in payment policy, CMS now says RACs can never audit claims with dates of submission between Oct. 1, 2013, and Sept. 30, 2014, in terms of admission necessity. CMS also gave Medicare administrative contractors (MACs) until Oct. 1 to finish their “probe and educate” reviews of compliance with the two-midnight rule. And CMS again clarified its order and certification requirements for inpatient admissions, updating its Sept. 5 guidance.

While the two-midnight rule and certification requirement can be confusing and frustrating, “we are making it more complicated than it needs to be,” says Minneapolis attorney David Glaser, with Fredrikson & Byron. “Sometimes I think we are asking for too much precision. You can make it simpler.” For example, if the physician orders an admission at midnight and it’s entered in the computer at 12:15 a.m., don’t agonize over when the clock started. “That’s false complexity,” he says. “If you know when the doctor ordered it, go with that time. Don’t think of all the ways someone can interpret it.”

Ronald Hirsch, M.D., vice president of the regulations and education group at Accretive Physician Advisory Services, agrees. “If you spend too much time trying to figure out the minutiae of a certification form,” he says, “the doctor will have no time left to explain why the patient needs to be in the hospital.” He thinks hospitals should take advantage of the audit reprieve to educate physicians on “how to count two midnights, how to document well and how to think in ink.”

The best audit defense is legible, complete progress notes, says Howard Stein, D.O., associate director of medical affairs at CentraState Healthcare System. “There is going to be a potential for MAC and RAC auditors to look at the progress notes and say, ‘we can’t read them’ or ‘they don’t justify the certification, and we are denying the stay,’” he says. If the “SOAP” — subjective, objective, assessment and plan — is documented in the progress notes, hospitals should be able to satisfy certification requirements, Stein says.

Visit to read the article in its entirety, which also includes coverage of a Feb. 4 open-door forum CMS held after the delay was announced.

About Report on Medicare Compliance

The industry's #1 source of timely news and proven strategies on Medicare compliance, Stark and other big-dollar issues of concern to health care compliance officers, the award-winning Report on Medicare Compliance identifies and provides valuable guidance on dozens of high-risk billing and documentation problems and foreshadows the next moves of federal enforcers and their armies of RAC, ZPIC and MAC auditors. “The best information there is for hospital compliance officers,” the 8-page weekly newsletter includes insights and strategies not available anywhere else.

Since 1992, Report on Medicare Compliance has been written by Nina Youngstrom, who has a reputation for being one of the most knowledgeable journalists and incisive writers in the field. With excellent contacts at the IG's office and at CMS, and strong relationships among industry experts and compliance officers, each issue of Report on Medicare Compliance contains exclusive, inside news. Visit for more information.

About AIS

Atlantic Information Services, Inc. (AIS) is a publishing and information company that has been serving the health care industry for more than 25 years. It develops highly targeted news, data and strategic information for managers in hospitals, health plans, medical group practices, pharmaceutical companies and other health care organizations. AIS products include print and electronic newsletters, websites, looseleafs, books, strategic reports, databases, webinars and conferences. Learn more at

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