Ohio hos­pi­tals sue over two-mid­night pay cut

Modern Healthcare - - REGIONAL NEWS - —Lisa Schencker

Six Ohio hos­pi­tals are su­ing HHS over a part of the two-mid­night rule that would cut in­pa­tient pay­ments to hos­pi­tals.

The hos­pi­tals want the U.S. Dis­trict Court in Colum­bus to va­cate a part of the rule, im­ple­mented in 2013, that re­duces com­pen­sa­tion for in­pa­tient ser­vices by 0.2%. That re­duc­tion was meant to off­set es­ti­mated costs to Medi­care as­so­ci­ated with the rule, which di­rects CMS pay­ment con­trac­tors to pre­sume short-term hos­pi­tal stays are in­pa­tient ad­mis­sions, rather than out­pa­tient ob­ser­va­tion vis­its if they span two mid­nights.

The hos­pi­tals say that the part of the rule call­ing for pay­ment re­duc­tions is “an ar­bi­trary, capri­cious and un­rea­son­able ex­er­cise of author­ity un­der the Medi­care Act” and that HHS didn’t fol­low the proper rule­mak­ing process in is­su­ing it. The six hos­pi­tals stand to lose about $564,106 a year un­der the rule, they say.

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