ED Coding and Reimbursement Alert

Question: In your previous issue, there was an article about how the OIG downcoded a claim in which the ED made the decision to admit a patient to the hospital ("This ED Error Is Among CMS's Examples of How Not to Report Claims"). In the article, you noted that the OIG determined there was no medically necessary reason for that admission. We've been in situations when this has happened as well and are wondering what we can do to show why an admission was medically necessary?

Codify Subscriber

Answer: The best way to demonstrate medical necessity is with thorough and accurate documentation. While the decision to admit a patient is a clinical one, the clinician must be able to demonstrate why he or she made that decision, and only a robust medical note can support that.

CMS offers the following advice in Transmittal 234 (dated March 10, 2017) about making the decision on whether to admit a patient:

"Physicians should use the expectation of the patient to require hospital care that spans at least two midnights period as a benchmark, i.e., they should order admission for patients who are expected to require a hospital stay that crosses two midnights and the medical record supports that reasonable expectation. However, the decision to admit a patient is a complex medical judgment which can be made only after the physician has considered a number of factors, including the patient's medical history and current medical needs, the types of facilities available to inpatients and to outpatients, the hospital's by-laws and admissions policies, and the relative appropriateness of treatment in each setting."

CMS states that clinicians should consider factors such as the following when deciding whether to admit a patient:

• The medical predictability of something adverse happening to the patient
• The need for diagnostic studies that appropriately are outpatient services (i.e., their performance does not ordinarily require the patient to remain at the hospital for 24 hours or more) to assist in assessing whether the patient should be admitted
• The availability of diagnostic procedures at the time when and at the location where the patient presents.

If a payer denies a service because it believes the patient didn't require hospital admission, you can always appeal the denial with a letter from the physician explaining why the patient's condition warranted inpatient status.