On Thursday, August 2, 2018, the Centers for Medicare & Medicaid Services (“CMS”) released its 2019 Inpatient Prospective Payment System and Long-Term Care Hospital Prospective Payment System Final Rule (the “2019 IPPS Final Rule”). With the goal to reduce unnecessary administrative burden on physicians and other qualified practitioners, the 2019 IPPS Final Rule revises the requirement that an inpatient hospital admission order be present in the medical record as a condition of Medicare payment. Specifically, the 2019 IPPS Final Rule amends the regulations at 42 C.F.R. § 412.3(a) to remove the language stating that a physician order must be present in the medical record and be supported by the physician admission and progress notes in order for the hospital to be paid for the inpatient hospital services under Medicare Part A. See p. 1390 et seq.
Significantly, CMS made no changes to the 2-midnight rule in its 2019 IPPS Final Rule. Under the 2-midnight rule (codified at 42 C.F.R. § 412.3), an individual is considered an inpatient if formally admitted as an inpatient pursuant to an order for inpatient admission. Unless an exception applies, an inpatient admission is generally appropriate for payment under Medicare Part A when the admitting physician expects the patient to require hospital care that crosses 2 midnights. Therefore, although CMS removed the requirement for an inpatient hospital admission order to be present in the medical record as a condition of payment, an inpatient hospital admission order is still relevant and necessary. The inpatient hospital admission order reflects the determination by the ordering physician or other qualified practitioner that inpatient hospital services are medically necessary, and it initiates the inpatient hospital admission for the purposes of 2-midnight rule compliance.