Earlier this year, CMS announced a new rule called the “two-midnight rule” which states that a patient will only be covered under Medicare Part A if they stay in the hospital for at least two nights. Instead, providers will be reimbursed under Medicare Part B (placing them in observation status) which critics believe will result in reduced reimbursements and unsatisfied patients.
Most providers are against the new law, believing it will negatively affect their revenue. Providers understand that they’ll need to make a greater effort in collecting co-pays since patients will be paying a higher out-of-pocket amount. Additionally, the financial ramifications of changing a patient’s status from inpatient to outpatient is predicted to negatively impact patient satisfaction.
The two midnight rule is set to go into effect January 2014.
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Click here for FAQs about the new law from CMS