Two-Midnights Rule Spells Grim Financial Forecast for Hospitals
"The patient is going to stay no more or no less than is medically necessary," Alvin Felgar, president and CEO of Frisbie Hospital in Rochester, NH, said. "The patient is still going to get the same care. We're just going to be paid a whole lot less for it." He was reached at his office Friday.
Moody's also found the two-midnight rule "will accelerate trend of inpatient care shifting to outpatient… pressuring hospital revenues."
In a prepared statement Friday, federal officials said that the investor service report exaggerates the new rule's financial impact on hospitals. "CMS does not agree with the assertion that the two-midnight rule will accelerate the trend of inpatient care shifting to outpatient," the officials said.
"CMS stated the following in the FY 2014 Hospital Inpatient Prospective Payment System (IPPS) Final Rule: 'our actuaries… estimate that there will be approximately $220 million in additional expenditures resulting from the net increase in hospital inpatient encounters [emphasis added] due to some encounters spanning more than 2 midnights moving to the IPPS from the OPPS, and some encounters of less than 2 midnights moving from the IPPS to the OPPS.'"
CMS also pointed to the intent of the two-midnights rule as described in an agency Q&A document, which states the "rule developed, in part, to address concerns regarding benefit eligibility and beneficiary cost-sharing issues associated with prolonged outpatient hospital stays."
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