The Two-Midnight rule, adopted in October 2013 by the Centers for Medicare and Medicaid Services, states that more highly reimbursed inpatient payment is appropriate if care is expected to last at least two midnights; otherwise, observation stays should be used.

What is the Medicare 2 midnight rule?

The Two-Midnight rule, adopted in October 2013 by the Centers for Medicare and Medicaid Services, states that more highly reimbursed inpatient payment is appropriate if care is expected to last at least two midnights; otherwise, observation stays should be used.

Is the two-midnight rule in effect?

The Two-Midnight Rule, which took effect January 1, addresses when inpatient admissions are appropriate for Medicare Part A payment. The OPPS rule includes a significant change that will allow Medicare Part A payment, under certain circumstances, for stays lasting less than two midnights.

What is the 2/3 midnight rule?

Under this rule, most expected overnight hospitalizations should be outpatients, even if they are more than 24 hours in length, and any medically necessary outpatient hospitalization should be “converted” to inpatient if and when it is clear that a second midnight of hospitalization is medically necessary.

What is the Medicare 30 day readmission rule?

Medicare counts the readmission of patients who returned to a hospital within 30 days even if that hospital is not the one that originally treated them. In those cases, the penalty is applied to the first hospital.

Why was the two-midnight rule created?

In 2013 CMS announced the so-called two-midnight rule to clarify when it expected a patient to be designated to inpatient status. Under this rule, only patients that the doctor expects will need to spend two nights in the hospital would be considered as hospital inpatients.

Do Medicare Advantage plans follow the two-midnight rule?

The two-midnight rule is included in the Medicare manuals and is not superseded by regulation, so Medicare Advantage plans must follow it.”

Does Medicare penalize hospitals for readmissions?

For the readmission penalties, Medicare cuts as much as 3 percent for each patient, although the average is generally much lower. The patient safety penalties cost hospitals 1 percent of Medicare payments over the federal fiscal year, which runs from October through September.