Legal and Regulatory Compliance

Highlights from Nov. 12 Open Door Forum on 2-Midnight Rule

November 21, 2013 2:29 pm

On Nov. 12, 2013, CMS hosted a third, follow-up special open door forum to allow providers and other interested parties to ask questions on those areas of the two-midnight provision contained in the FY14 IPPS final rule, pertaining to physician order and certification, inpatient hospital admission, and medical review criteria.

Discussion Highlights


Probe Review & Educate Period Update. MACs will focus their reviews on samples of 1-night inpatient claims; two-midnight claim reviews will not be conducted.
One of the most notable changes discussed during the call was the extension of the probe and review period for an extra three months, from Oct. 1, 2013, through March 31, 2014. The initial review period was to have spanned the course of three months, from Oct. 1, 2013, through Dec. 31, 2013.

  • Hospitals that submit claims that contain 0-1 errors during the review probe will receive no further review from the MACs until after the probe period ends, unless there are significant changes in billing pattern for admissions.
  • Non-compliant claims will be denied, and the reason(s) for the denial will be outlined in a letter and mailed to the provider. 
  • MACs will also call providers with moderate to significant or major concerns and discuss the denial errors, provide education, and answer questions. Corrective action after the review depends on how many errors are found.
  • MACs will conduct additional probe reviews on the claims submitted by providers that are identified as having moderate to significant or major concerns. The size of these additional reviews will be 10 claims (with dates of admission January – March 2014) for hospitals, and 25 for large health systems. 
  • For providers that have continuing concerns after the six-month review period, the MACs will review a sample of 100 claims for hospitals and 250 for large hospitals.
  • CMS reiterated that Critical Access Hospital claims are not included in the patient status review period. CMS will issue guidance as to whether or not this will change in the future after the initial round of probe and review.
  • CMS understands that there are certain rare and unusual circumstances related to the two-midnight benchmark where the physician expects the patient to stay in the hospital for two midnights but the patient ends up leaving the hospital unexpectedly (due to death, transfer, leaving against medical advice, or improved condition). There may be some circumstances that CMS has not yet considered. CMS is compiling these circumstances and is seeking others from the public to add to this list. Those submitting suggestions should use the subject line “Suggested Exceptions to the 2-Midnight Benchmark” whenever possible. CMS will be issuing guidance to contractors about how to handle these cases in the near future.

ED Care and Triage. CMS provided clarity pertaining to ED care and the role of triage. In the spirit of the regulation, the provider would need to initiate the care for ED patient care. A nurse performing triage duties, including taking vitals and assessing the patient’s condition, does not meet the regulation requirements pertaining to when care begins. The clock of care starts when the physician orders it.


Transcribed Orders. The MACs will consider orders transcribed by nurses and co-signed by the physician for the components of physician certification. As long as the inpatient admission is conducted pursuant to a legitimately signed order, then all of the information in the medical record is relevant.


Social Admissions. Cases where patients come to the hospital requiring less intensive services and are admitted for social reasons (for example, alcohol detox services) are not appropriate for inclusion in the two-midnight benchmark for inpatient care. The care has to be medically necessary in order to be covered by Medicare.

Inpatient Psychiatric Care. The language in the September 5th document may have lead some to understand that inpatient psychiatric facilities would not be included in the probe and educate review. CMS clarified that MACs will apply the 1599 probe and educate review to inpatient psych facility claims. The new rules do apply to these facilities; however, CMS has not updated the subregulatory guidance pertaining to these facilities to comprehensively reflect the new requirements for the two-midnight rule.

Transfer Cases

  • Transfer cases are at the top of CMS’s list of priorities to examine and address.
  • CMS is excluding transfer cases from the probe and educate reviews for the foreseeable future, and noted that if that does change, it would give adequate additional guidance to apply to the two-midnight benchmark. CMS hopes to have something available on that soon

Ambulance Care. Pre-hospital time (care provided in the ambulance) does not count towards the two-midnight benchmark even if EMTs receive instructions for care from the hospital physicians over the phone. The benchmark begins when the patient begins receiving meaningful care at the hospital.

More Information


CMS’s Questions and Answers Related to Patient Status Reviews (Released Nov. 4). CMS has received lots of good feedback and questions to the IPPS admissions mailbox on various facets of the two-midnight provision for admission and medical review criteria. CMS has been working diligently to answer all questions submitted, and has recently released a comprehensive, categorized compilation of these questions and answers in a new guidance document. These Q&As are mainly those discussed in the Sept 26th call, but also include information on rare and unusual circumstances related to the two-midnight benchmark. CMS will continue to update the Q&A document based on feedback received and, for ease of use, will note if each question has been updated or is a new response. 

CMS’s Selecting Hospital Claims for Patient Status Reviews (Last Updated: 11/04/13). Contains a summary of the technical direction CMS will issue to the Medicare Audit Contractors (MACs) about how to select hospital claims for review during a “Probe and Educate” program for admissions that occur October 1, 2013, through March 31, 2014. 

CMS’s Reviewing Hospital Claims for Patient Status (Last Updated: 11/01/13). Contains guidelines for MACs to follow when conducting patient status reviews to determine a hospital’s compliance with CMS-1599-F, which focuses on the appropriateness of an inpatient admission versus treatment on an outpatient basis. 

Other resources:

For more information about the two-midnight rule, visit CMS will continue to update this page with additional medical review information.


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