The Two-Midnight Rule: Changes for 2016

Medical Necessity Documentation Still Required

Have you heard the news? In the 2016 Outpatient Prospective Payment System Final Rule the Centers for Medicare & Medicaid Services (CMS) has modified the two-midnight rule evaluation and enforcement process. The “probe and educate” period ends on January 1, 2016.

Enforcement of the rule will be the responsibility of the two BFCC Quality Improvement Organizations (Livanta and KEPRO). Their charge is to evaluate the appropriateness of short-stay inpatient admissions that extend over less than two midnights. Both BFCC Quality Improvement Organizations (BFCC-QIOs) will use InterQual as a decision support tool to help evaluate whether short inpatient stays are medically necessary and meet some other requirements of the rule.

These changes are good news for over 4,000 hospitals that currently license InterQual. CMS continues to emphasize the need for documentation of medical necessity in the medical record. In choosing to use InterQual, the BFCC-QIOs are leveraging InterQual’s evidence-based criteria to support clinical decision-making and affirm medical necessity.

Documenting medical necessity and validating the adequacy of that documentation through the use of InterQual will go a long way in helping hospitals avoid referrals from the BFCC-QIOs to recovery audit contractors (RACs).

How will this affect InterQual users? When the rule was originally implemented in 2013, we knew it would likely evolve over time. We decided to focus on modifying the review process rather than create new clinical content. This let us continue to focus our content on clinical patient care and the services they require rather than payment status, as we have for nearly 40 years.

While there might be some minor modifications, the recommended review process for Medicare FFS patients that we developed in response to the 2013 rule also effectively addresses the new changes for 2016. And using InterQual to confirm that inpatient admissions are medically necessary will help to ensure that those patients who unexpectedly improve and do not achieve the two-midnight benchmark will still be considered inpatients should their charts be audited by the BFCC-QIOs.

The bottom line: The long-standing requirement that medical necessity be documented in the medical record remains unchanged and, if anything, is more important than ever before. InterQual’s objective, evidence-based clinical criteria helps providers ensure their medical record documentation supports medical necessity.