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How IPPS Final Rule Affects Medical Coding

Michelle A. Leppert, CPC, August 7, 2013

CMS stated that it would be easy for the patient to understand the two-midnight rule but Mackaman disagrees. "If patients are being cared for in inpatient areas, which is not uncommon for patients who are receiving observation services, and they stay two midnights, this will not mean they are an inpatient and they may have greater out-of-pocket expenses," Mackaman says.

In addition, the two-midnights rule will create a huge operational burden on facilities, beyond what they already do to try to stay in compliance with monitoring the appropriateness of admissions, she adds.

Part A to Part B rebilling

CMS also finalized the enforcement of the timely billing requirement for Part A to Part B rebilling of additional services. On March 13, CMS issued a ruling and a proposed rule that would allow hospitals to rebill Part A services as Part B for claims deemed not medically necessary.

The hospital will receive full Part B reimbursement for the services provided during the inpatient stay rather than the "short list" that hospitals were able to bill.

The ruling, which went into effect immediately, allowed hospitals to rebill as Part B the services that the hospital would have provided if the patient had been an outpatient rather than an inpatient. The ruling did not include a timely filing requirement. However, in the IPPS Final Rule, CMS includes the timely filing requirement beginning on October 1, 2013. Hospitals will now have one calendar year after the date of service to rebill the stay.

"Under the final rule, hospitals will have fewer Recovery Auditor claims that will fit into this time frame but they will be able to use this process for 'self-denials' that are discovered after the patient has been discharged," Mackaman says.

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