The CMS finalized a modified two-midnight policy Friday,
despite arguments that the modified rule could lead to fraud.
The two-midnight rule calls for Medicare’s payment and audit contractors to assume a hospital admission was legitimate if it spans two midnights. The agency will allow doctors to exercise judgment in admitting patients for short stays. The CMS is removing auditing oversight from its administrative contractors and instead letting quality improvement organizations (QIOs) enforce the policy. Recovery audit contractors (RACs) would be directed to focus only on hospitals with unusually high rates of denied claims.
The American Hospital Association said hospitals “look forward” to working with QIOs rather than RACs, and anticipate a fairer auditing process.
The CMS denied a request to delay enforcement, saying the Jan.1, 2016 start date was enough time for hospitals to understand the final rule.