Lawmakers probe hospital pay for short-stay patients

May 22 2014

The House hearing was the first congressional inquiry into the consequences of Medicare's "two-midnight rule," which has drawn criticism from seniors and hospitals. An administration official said the agency is asking for ideas on how to design a different payment system for short-stay patients.

Kaiser Health News: Medicare May Be Overpaying Hospitals For Short-Stay Patients
The federal government may be overpaying hospitals an estimated $5 billion as a result of the 18-month moratorium on enforcing a controversial rule that tells hospitals when patients should be admitted, an independent Medicare auditing company told a congressional panel Tuesday (Jaffe, 5/29).

Modern Healthcare:  CMS Considering Alternatives To 'Two-Midnight' Rule
Faced with withering criticism, CMS officials are asking for ideas on how to design a new payment system for treating Medicare patients who need only a day or so in the hospital. The issue has turned into an administrative mess for the CMS, with billions of Medicare dollars at stake flowing to thousands of hospitals and doctors. Last October, Medicare implemented a new rule to clarify that patients needed two nights in the hospital to qualify for inpatient-hospital rates, but that so-called "two-midnight" rule has become more controversial than the old system (Carlson, 5/20).

In other Capitol Hill hearing news -

Modern Healthcare:  Legislators Decry Broken Medicare Payment Appeals Process
Legislators from both sides of the aisle expressed concern during a congressional hearing Tuesday that vigorous federal investigations of potential Medicare fraud could result in providers that have done nothing wrong being unfairly punished. While legislators stressed that they want transgressors punished, they worried that the system for appealing Medicare payment decisions is so broken that it offers little protection for providers that have been wrongly denied reimbursement for treatment they delivered. The hearing showcased once again why it's easy for politicians to talk about cracking down on Medicare fraud and abuse but devilishly hard to carry it out (Demko, 5/20).