Hospitalists Call for Changes to the Two-Midnight Rule

According to a recent survey, hospitalists said that the 2-midnight rule is negatively impacting patient care as well as patient finances.
Published Online: August 04, 2014
Katie Sullivan, MA
According to a recent survey, hospitalists said that the 2-midnight rule is negatively impacting patient care as well as patient finances.

The rule, which was enacted by CMS, only reimburses providers at Medicare inpatient rates when patients are admitted to a hospital for at least 2 overnight stays. Patients that are not admitted are billed as outpatients or under observation status. These stipulations were implemented to ensure that providers were only admitting patients who truly required inpatient stays.

But hospitalists claim that the rule is disrupting their workflows and clinical decision-making processes. It has also negatively impacted many provider-patient relationships. The Society of Hospital Medicine Public Policy Committee, which conducted the study, reported that:

“It is clear that the current use of observation status is not a sustainable policy. Providers, hospitals and their patients are feeling unnecessary pressures from observation policy and, in many cases, patient care is being undermined. Hospitalists resoundingly agree that the policy requires significant changes focused on solving the myriad problems underlying the current system.”

Hospitalists have proposed both short-term and long-term solutions to improve decision-making during the inpatient admission process. In the short term they suggest focusing on provider and patient education. They also recommend reforming the Medicare Recovery Audit Contractor program to ensure that providers aren’t being pressured into making certain decisions. In the long term, they suggest that observation status be eliminated and replaced with an alternative system that can manage patients who require shorter inpatient stays.

“Observation status policy directly and unnecessarily stresses the physician-patient relationship. Indeed, it is not uncommon for patient frustrations with the policy and its shortcomings to be directed at the hospitalist, case managers and the hospital,” read the report. “In effect, observation status is undermining the trust that patients have in their doctors and hospitals to provide them with the best care possible.”

Around the Web

The Observation Status Problem: Impact and Recommendations for Change [SHM]

Adult ADHD Compendium
COPD Compendium
Dermatology Compendium
Diabetes Compendium
GI Compendium
Immuno-oncology Compendium
Lipids Compendium
MACRA Compendium
Oncology Compendium
Pain Compendium
Reimbursement Compendium
Rheumatoid Arthritis Compendium
Know Your News
HF Compendium
Managed Care PODCAST