The “superpackaging” of outpatient procedures and the new two-midnight rule for inpatient admissions are moving parts of the same mechanism, with CMS shifting the gears to reward hospitals for quality and efficiency instead of performing more services, experts say.
The interdependence of the inpatient and outpatient prospective payment systems also affects audits. Auditors may get a leg up from CMS’s plan to package more HCPCS codes for goods and services into APCs, as set forth in the 2014 proposed outpatient prospective payment system (OPPS) regulation. In one fell swoop, they could deny claims for certain procedures if hospitals don’t establish medical necessity with the appropriate diagnosis code. On the inpatient side, auditors will focus more on one-day stays on the “presumption” that stays that cross two midnights are medically necessary if there’s supporting documentation and the hospital isn’t playing games
“It’s a massive culture change,” said William Malm, senior data projects manager at Craneware in Atlanta, at the “Finally Fridays” webinar sponsored by the Appeal Academy on Aug. 30. “Outpatient has always operated more on an à la carte methodology while inpatient is more a buffet, and they are starting to close the loopholes on à la carte. They are saying ‘get out of the culture of separate payments.’ They want to see a continuum of care based on evidence-based medicine.”
CMS Rules Are Meshing
In the 2014 OPPS, CMS takes a giant step toward making the word “prospective” meaningful. Right now OPPS is a hybrid, with some goods and services packaged into APCs and others paid separately. But that is expected to change on Jan. 1, when Medicare would:
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(1) Pay a fixed price for 29 “device-dependent” procedures;
(2) Package payment for seven categories of integral, ancillary, supportive, dependent or adjunctive items and services;
(3) Replace the two observation APCs with a new, streamlined version, and
(4) Pay a flat facility fee for emergency room and provider-based clinic visits instead of letting hospitals choose from five levels of service (RMC 7/15/13, p. 1).
Meanwhile, if patients are headed for a stay that will last for two midnights, they are admitted under the new benchmark in the 2014 inpatient prospective payment system regulation. In between is observation, Malm said, which becomes more of a true outpatient event.
Date: Sept. 24, 2013