Tony Sesta is a founding partner of Case Management Concepts, LLC, a consulting company that assists institutions in designing, implementing, and evaluating case management departments and models, educational programs, and on-site support for leadership and staff. Dr. Sesta has been active in the research and development of case management for more than 25 years. Her research has included two funded studies measuring the effects of a case management model on congestive heart failure and fractured hip patient populations with measures of patient satisfaction, quality of life, and short and long-term clinical perceptions and outcomes. And thank you so much for being here with us today, Dr. Sesta. I invite you to go ahead and get us started. And just so everyone knows, I will be managing the slides today, so you may hear Dr. Sesta tell me, next slide, next slide, a couple of times. But I will try to do my best to do that at a timely basis, Dr. Sesta. No problem. You know, it's always something with the internet. And I still think, Lindsay, that it had something to do with satellites and things with all this bad weather that we're having. But I don't know. I don't know. I'm just hypothesizing here. But I do thank everybody for joining us for Module 2 this morning. And we're talking about good old utilization management. And we're going to go through some of the rules and regs just to make sure that you're all compliant with what the Centers for Medicare and Medicaid Services expects from us as it relates to UM. And then also how you can integrate best practices into your daily work that you perform so that you can assist your organization in getting paid. Because at the end of the day, we provide a service in our hospitals and we want to get paid for it. So that's ultimately what we're about when we perform this particular role of many of our roles that we perform. And we'll wrap up today talking about denials and appeals and what that all means under this umbrella of utilization management. So with that, Lindsay, we're going to start. Oh, I went right away to my mouse to forward. See how habits stick with us? There we go. Okay. So you can hit it one more time, Lindsay, please. Thanks. There we go. Okay. So obviously today we're talking about utilization management. And as you perhaps heard me talk about last week, the early case management models going back to the mid-1980s that had not very much in common with what we're talking about in today's universe of case management. But one of the early transitions was the shift from utilization management or what it was called then utilization review to case management. So this was in response to prospective payment and those DRGs that we reviewed last time. And the whole notion was how are we going to control quality and cost at the bedside if we just continue to do things the same way without adjusting what folks are actually doing to respond to prospective payment. So utilization remains as one of our fundamental roles that we perform today. And we can hit that again, Lindsay. And, of course, we've added on and added on over the years and integrated a lot of these roles. And in our Module 5, our last one in this series, we're going to talk more about how all of this kind of comes together in the different models that are being used in the field today. So resource management, when we look at what the physician actually orders versus what the patient actually needs, what is actually appropriate. And in our care coordination webinar, which I believe is number four, we'll talk more about that. And that, again, dovetails with our next arrow, Lindsay, care coordination. So when you look at resource management and avoidable delays and care coordination, you start to see that all these pieces kind of integrate with each other, hard to tease them apart sometimes. And lastly, our last arrow, discharge and transitional planning, which we'll talk about next week. So what I want you to take away from this is that all these roles play off each other. And I talk a lot about silos. And I talk a lot about people being in their own silos and separated from each other. And one of the things we have to remember when we talk about case management is that you cannot be effective if you continue to work in an isolated fashion with one person doing one thing and another doing another thing. If we've learned nothing else over the years, we've learned that we have to integrate these roles in a really comprehensive way. So let's move on now to some of the definitions for utilization. Now, if you've been around a while, like I've been around a while, you may remember back to those early days in the 80s. And I remember being a staff nurse. And there was a UR nurse sitting in the nursing station. And nobody knew what she did. You know, it was a very mysterious job that she performed. And she was looking at the records, but she didn't see patients. And it was all very suspicious, and nobody really understood it. Well, if we can move to the next slide, then that was the old UR, Utilization Review, which was a passive process. But CMS tells us that we should be reviewing our cases for medical necessity and appropriateness of those services. And those services that are actually being provided or proposed to be provided to a beneficiary, as they call the patients. So today, when you do a clinical review, what you're doing is you're looking for evidence in that medical record to support medical necessity. That's what this is about. So we're not just looking to cut and paste, and we'll talk about that, and send off information to our third party payer. But rather, we're looking for the evidence to support that medical necessity. And we use different tools to do that. So in your hospital, you might use the InterQOL software, or the Millman Guidelines software to do that, or some other set of guidelines. The guidelines are evidence-based. Those guidelines tell you what, based on evidence, is the best way to meet medical necessity for that particular patient. So it's not something you want to memorize. It's not something you want to guess at or reflect on from three years ago. Because these guidelines do change every year, and they change because the evidence changes, and the treatments change. So you want to really use that evidence to support your case. So you are passive utilization management, which is what we talk about today. And I'll just caution you that Centers for Medicare and Medicaid Services still calls it UR. So we get a little funky there with the UR versus the UM. But in our best practice discussions about this, we like to say UM. And I do flip back and forth on occasion myself. So utilization is, management is active, and it's operational. So it's a proactive process. It's a proactive procedure, again, to review for medical necessity. And then to collaborate with your healthcare team to be sure care is clearly documented. So as we talked about last time, there's a relationship between what your physician and ancillary services documents in the medical record, and your ability to code at the highest level, but also to be sure you meet medical necessity. So physician documentation is so important on all these different levels. Again, UM aligns with the other roles that we just talked about. And it requires critical thinking. So if I'm doing a clinical review, I'm not just blindly picking off things. Because typically what will happen, as you know, is that when you do a clinical review, you're probably going to want to add additional laboratory values, support, physical therapy notes, things like that. So you really want to be very thoughtful about this. The other thing that gets a little more complicated, certainly in today's world, are the different payers. Even under Medicaid, things can get a little weird with some of the Medicaid insurance payers. I don't need to tell you. Things have gotten pretty difficult with some payers. But we need to understand what they're looking for and what their specific reimbursement structures might be. So when we say UR, that passive role, it's an audit process. And yes, in UM, we are also doing that audit. We are looking for medical necessity in the physician's documentation. But then we're doing something about that audit. So that's the fundamental difference between the two. Next slide. So since we are looking for medical necessity, let's look at what a definition is of medical necessity. So again, I said it has to do with evidence, evidence in the literature, research, and so forth. So accepted healthcare services and supplies, accepted. So again, based on evidence, provided by healthcare entities, appropriate to evaluation and treatment of a disease, a condition, an illness, or an injury, and consistent with the applicable standard of care. So again, you can't just kind of guess what that is. You want to use the guidelines available to you to make your case. Another way to think of it is neither more nor less than what the patient requires at a specific point in time. So while you're doing your review, you are looking at that resource management piece. So is this redundant? In other words, are we repeating tests, laboratory tests or other tests more frequently than is necessary based on my evidence? Or are we under-treating our patients? So we'll talk more about that in the care coordination module too. Okay, next slide. So integration of your UM principles into your daily practice obviously is very important. Now some of you may be working in a case management model where the function of utilization management is being performed by staff. You are nurses, UM nurses perhaps, separate from case management. So in that model, the collaborative practice model, which we'll talk about in webinar five, in that model, UM is separate. In the integrated model, UM becomes part of all the roles that a case manager performs. Excuse me. So it doesn't matter for the purposes of our discussion today whether this is what you do solely, utilization management, or whether your UM is integrated because the steps and the processes remain the same. So you want to assist in determining if care in your current setting is appropriate, essential and related to the reason patient is in that setting. And let me just say, these overriding points that I'm making would apply to both your Medicare and your Medicaid and your commercial populations. Okay, so this is consistent. And when I hear, you know, it's so interesting. Some hospitals I visit as a consultant only do clinical reviews on Medicare patients. Others only do reviews on commercial patients. We really should, and I know this is maybe a little pie in the sky based on your staffing ratios, but in a perfect world, we should be reviewing every patient. So if you're looking at, is the current setting appropriate? Is it essential? Are the resources cost effective and efficient? That doesn't matter what the payer is because you want to be sure that that patient is in the right setting, whether they're Medicare or something else. The attending physician must be included in your review where documentation and the record does not support appropriate, efficient and cost effective patient care. So we as nurses cannot unilaterally decide that something does not meet medical necessity, and we'll talk about that. Your first line of defense is always to ask the physician if they can add more documentation. And along with that, you're going to be reviewing your lab results, your consult reports, any other supporting evidence that might be in that medical record, and anything that may relate to support of that medical necessity for that patient in that current setting. So before you go any further, before you run this up the flagpole, you want to talk to the physician of record. And you want to be thoughtful about how you do that, how you approach your physicians. Next slide. So let's say we have that conversation with our physician, and our physician says, I have nothing else to add. I'm so sorry, but I can't provide you with any additional information to support your, well, they're probably not going to say it this way, but to support medical necessity. When that happens, then you have to refer the case to your physician advisor, okay? Because a non-nurse, whether you are a UR nurse, UM nurse, RN case manager, we cannot determine lack of medical necessity, again, independently of a physician, okay? So any time you get into this situation, a referral has to be made to the physician advisor. Your physician advisor, whether it's an internal physician advisor or an outside company that you might use, should be reviewing the record and should have a conversation then with that physician, that attending physician, if medical necessity is determined not to be met by that physician advisor. The other thing to know is, while medical necessity is determined through your criteria that you're using, CMS has told us that every case has to be evaluated independently of the others on a case-by-case basis. And sometimes the clinical information you're using, the guideline you're using, just, you know, it doesn't align with what that patient is presenting with. And in that instance, and it shouldn't happen that often, but it certainly can happen, well, then that determination should be supported by the peer review from your physician advisor. So again, that physician has the ultimate say. Hopefully in your payer contracts, and you're allowed to see the UM portion of your payer contracts that you're going to see, their language regarding medical necessity reviews, as well as their appeal and denial process. And I always get concerned when case management departments tell me that they're not allowed to see it. Well, you don't want to see the whole contract, but you surely do want to see the section relating to utilization management and what that third-party payer is expecting of you when you perform this role. Okay, next slide. So as you may have gathered, there we go. I'm getting very insecure, Lindsay, about the internet today, you know. No, you're good. It takes a second, it looks like, to kind of keep up. I see that now. I'll calm down. It's good. It's good. Okay. So you may also be a UM nurse who is sitting in a remote location. Now, what that is doing is mimicking, if you will, what our third-party payers do. So they're sitting in a remote location somewhere, could be in another state, and what they're doing is they're receiving your information from you, and then they're saying, meets, doesn't meet, whatever, whatever language. We're going to pay, we're not going to pay. We don't want to mimic that. You can have a dedicated UM nurse, but we would love to see you all right on the unit, rounding with the staff, meeting the patients, getting a much better sense of that patient from seeing them and speaking to them from looking at the medical record. And so we'd like to see UM part of the interdisciplinary care team. And I know that may sound strange to some of you, but we do find that it does work better when we do it that way. So we don't really want to mimic – all the third-party payers are trying to do is not pay us. We want to get paid. So we want to use every tool in our toolbox to get paid, and part of that is bringing UM closer to the bedside. Okay. Next one. Oh, that was faster. Okay. So as I said at the start, I think it's important for us to have some context in terms of these rules and regulations because we are fortunately or unfortunately obligated to follow certain rules of the road as it relates to UM. So let's go to the next slide and see what that all means. So you may or may not have heard of the COP rules, conditions of participation. These are from CMS. They're in the 42nd Congressional Federal Register. So these are approved by Congress, believe it or not. And so I think because of that, we don't see a lot of frequent changes, honestly, with the COP. But next week when we talk about discharge planning, we'll see how recently things were changed in the conditions of participation for discharge planning. But this morning, we're talking about utilization. So these are the rules from CMS by which you must follow to be paid. I don't think that was a correct sentence, but in order to be paid through your Medicare and Medicaid programs, you must follow these rules. You must abide by these rules if you were. There have been hospitals, and you may say, oh, you know, who's really looking? Well, the fact of the matter is that there have been some hospitals that have lost their payments through Medicare and Medicaid because of egregious nonconformity to the COP rules. So you can suffer consequences if you're not following the rules. Now, there's, I think, 13 of these two that apply to us on the bottom right. Then we have subsection 482.3, which is the conditions for utilization. Again, review, that's how they call it. And next week, we'll talk about 482.43, which is the discharge planning. Next slide. So these Medicare conditions for utilization review, they're not as long and complicated as the discharge planning, but there are a few things that we have to have in place. First and foremost, your hospital has to have a utilization review plan. And in that plan, it provides for the review of services furnished by the hospital. So in that plan, you're talking about how you're conducting clinical reviews and so forth. Also, members of the medical staff have to be reviewed. And so that's all laid out there. And then secondly, you have to have a UR committee. Now, as case managers, you may be saying to yourself, well, that UR plan, you know, it doesn't apply directly to me. And that's true in one sense. However, I can tell you that because the Joint Commission, for example, has been given deemed status by CMS to do reviews of the conditions of participation, they are asking these kinds of questions. So they may ask you when they're doing a tracer, they may very well ask you tell me about your UR plan. Now, they may not ask you that specifically, but they may ask you, where is the UR plan? Do you know there is a UR plan? So you all should know where your UR plan is in your intranet, your hospital's system, and at least eyeball it at some point in time prior to a survey. And UR committee, again, you don't need to know the particulars of the UR committee, but you do need to know that there is a UR committee. So fundamentally, the hospital has to ensure that all utilization review activities, including review of medical necessity of hospital admissions and continued stays are fulfilled. So in this instance, they're saying to us, we have to review our admissions and our continued stays. And I think in the early days, this is why folks only looked at Medicare, because that's what was mandated. But today, in order to survive in the commercial world, we certainly have to look at more than just Medicare. Next slide. So let's talk a minute about this UR committee. It's a committee of the medical staff, and it has to have at least two practitioners. And by practitioners, they mean physicians, generally. The UM committee, or UR committee, should conduct reviews of duration of stays and reviews of professional services in the following ways. For duration of stays, they want you to review cases reasonably assumed to be outlier cases based on extended lengths of stay. And that does not imply or mean that you have to review every long-stay patient, but a subset, perhaps a sampling, of those very long-stay patients. For professional services, you need only review cases reasonably assumed to be outlier cases based on extraordinarily high cost. So the UR committee should be looking at long stays and high-cost, high-dollar accounts. And I don't see a lot of the high-dollar-count reviews being done in the hospitals that I work with. So that's something for you directors to consider. Medical necessity reviews performed by the committee may not be conducted by an individual as a financial interest in your hospital or was professionally involved in that case that's being reviewed. So you can bring some sampling of medical necessity reviews also to your committee. So the committee is, you know, it's not expecting, CMS is not expecting a whole bunch from you, but there are things that have to be complied with. Next slide, please. So what is your process? What is the best way for you to follow a process for your patients meeting medical necessity? So let's just start on the left. We have a newly admitted patient. First thing we're probably going to want to do is look at the medical record. And when you have a newly admitted patient, you may not yet have a lot of documentation, especially if you're doing your first review while the patient is still in the emergency department. You know, that can create some issues, but you can at least maybe get it started. You also want to have a conversation with the physician. What is the physician's assumption about, other than a surgical patient, let's say a medical patient, what is the physician's assumption as to the diagnosis? What is the working diagnosis, if you will? What is the physician's hypothesis and reason for the admission? Then as I said, you should assess the patient at the bedside. You're going to get more from that in the two minutes or even the one minute you're with that patient than looking at that chart all day and trying to plow through and figure things out. So it's a much, may sound like it takes longer, but it's actually faster. And now you can complete your admission assessment, which we'll talk about in Webinar 5. But that initial review, not the initial review, the initial admission assessment when we start the discharge planning process, which is one tool. And then the medical necessity criteria, your clinical review would follow. Because now you've done an assessment, you've got all the information you need to complete that clinical review. And again, if the patient meets your criteria set, then you say, okay, when will I review this case again? And next slide, there's some different ways in which you make that decision. Maybe your department has a medical necessity review policy, perhaps. So in your policy, it tells you how frequently you should review the case. Or patient complexity, if it's a super complex, now this might sound counterintuitive, but if you've got a super complex patient and you know they're really sick and they're going to be there a while, you may not need to do a daily review on that kind of a patient. Or the payer, a lot of the payers will tell you when they want the next review. Or it may be in their policy manual or in your contracts with them. Or maybe the physician of ours says to you, keep an eye on this. Would you hit the slide thing again? Thank you. So, I mean, again, I like to talk best practice. But I am sensitive to the fact that not everybody has the right staffing ratios to do everything I say. But, you know, in a perfect world, we would be reviewing every patient every day. I mean, unless it's somebody in the ICU who's super sick. Because we don't know. If we don't do that, we don't know the point at which that patient is now progressing toward discharge. And there's your correlation between UM and discharge planning, how those two start to come together. Okay. Next slide, please. All right. Let's now talk about the different scenarios. And I know this looks real busy, but I'll walk you through it. This different scenarios for when a patient is not meeting medical necessities. So, you've done all your due diligence, and the patient doesn't meet. So, let's start in the upper left. Patient does not meet criteria. You discuss this with the physician of record. The physician says, sorry, no additional documentation today. Now, as we said, you're going to refer the case to the physician advisor for that, quote, second-level review. The physician advisor agrees with you in that medical necessity is not met. Okay. So, now you have the PA and you in agreement. Second line, physician advisor would then speak with the attending, the physician of record. Now, let's say your attending physician agrees with the physician advisor, yay, and he discharges the patient. Okay. Or, if the physician disagrees with the physician advisor, well, now we have to pull in a second committee member from the Utilization Management or Review Committee. So, this is why you've got to have at least two providers, practitioners on that UM committee, because you may call upon them, and they have to be members of that committee. And then a determination is made one way or the other. Or if we go down to the blue, if the physician advisor believes medical necessity is met, meaning he agrees with the attending and disagrees with you, if you're really concerned about it, you can certainly escalate it to your leader or continue to monitor for medical necessity considering what the physician advisor has told you, and then just continue to discuss. And it may happen that the next day the patient meets criteria or the next day they still don't meet. So, you just have to keep going with that ongoing dialogue. But at the end of the day, we're not the deciding factor, these physicians are. Next slide. So, as the reviewer, you, and as a nurse, you're that first-level reviewer. So, when you do your review for medical necessity, you're performing a first-level review, and we call that an audit. Now, the first-level reviews, you're not judging the physician's documentation, you're just looking for that supporting evidence to hopefully support that patient's stay in the hospital. So, it's not a judgment call at all, it's really an objective way of looking at the physician's documentation. Now, you can say to your physician, your documentation does not support my guide for medical necessity. Maybe the physician will understand what that means. Maybe they won't, depends on the physician, I guess. And you can ask for additional documentation. Doctor, do you have anything else that may provide us with a little more evidence to support this patient's admission to the hospital? That's another way, perhaps, to say it, or the way that you feel comfortable saying it. And again, reflect to the physician, you know, I see a test in here, or a procedure report, that does support medical necessity. If you could just speak to that in your progress notes, I think that would probably help quite a bit. So, just different ways to approach it. Again, if no additional documentation, then we're going to go to that physician advisor. Okay, next slide. So, let's talk now about non-Medicare payers, or your commercial payers, as I call them. You're going to follow your utilization management process. Remember, as I said before, it's going to be that same process, regardless of the payer. But if the patient is meeting medical necessity, and the payer wants a clinical review, you're going to use your medical necessity criteria to transfer that information to the payer. So, in terms of Medicare, we're doing it for purposes, and we'll talk more about this in a minute, of determining whether or not we believe that patient meets medical necessity. In terms of your commercial payers, they're making that determination. So, that's really fundamentally the difference between the two. We are delegated to do this for Medicare, and conversely, the commercial payers do it themselves. What you do not ever, ever want to do is cut and paste the medical record and send it to the payer. You only want to send supporting evidence that's pertinent to making your case. So, as I said before, it might be a test result, it might be a physical therapy note, or something like that. And do know that patients who don't meet your medical necessity criteria may actually meet the level of care ordered by the physician. And this is why we have to look at these cases on a case-by-case basis. Okay. Again, you're going to discuss it, you're going to escalate it. And send – once you've done your review, don't delay in sending it, even if you feel like it's not supportive of medical necessity. Go ahead and send it so that you get it in in a timely fashion, and who knows what will happen. Okay. Next one. So, we have two billing processes. Medicare is very nice about giving us a little bit more money when our patients don't meet inpatient criteria for medical necessity. And so, you've probably been involved with using a Condition Code 44 billing process. And there's so many different ways you guys will refer to provide a liable Part B billing, Code 121. It's all the same thing. We'll talk about it in a moment. But these are just billing codes, and they're not mysterious. They have nothing to do directly with how we treat the patient. They are just really defining how we'll bill, and this is strictly Medicare. So, next slide. So, let's talk about utilization review first. I'm sorry. Why did I say that? Condition Code 44 first. Okay. So, let's say your patient comes into the hospital. There has not been a review done. The patient makes it to the bed, and now a review is done, and the patient does not meet medical necessity. For Condition Code 44, the patient has to still be in the hospital, has not been discharged. There's no discharge order yet. Patient's in the hospital. What Condition Code 44 billing allows us to do is bill Medicare for Part B when the patient does not meet medical necessity and has not been discharged from the hospital. We'll talk about what Part B billing is in a second. So, this is a little bit more than you would get for Part B billing, but it's less than what you would get if had that been a hospital stay. The patient, in this case, has to be notified that they're being placed in observation. Now, CMS is very clear. You don't have to. When you use Code 44, you do not have to put every patient into observation. A lot of hospitals do do that routinely, but you really want to be thoughtful about that. That doesn't automatically mean the patient gets changed to observation. You may just go ahead and discharge that patient. That is another option. Patient also might be billed for their responsibility as they normally would under observation, and they should be getting the moon and all of that stuff. Again, to use Code 44, you have to pull in a member of the UR committee and hopefully the physician advisor. And the physician should concur, hopefully, with this. So, let's just look at how – oh, next slide – how this would look. So, how do we use Code 44 when the patient has not yet been discharged? Patients admitted as an inpatient, the physician documents inappropriate or incomplete medical necessity. And this is your first-level review by you, done by you, and you discuss it with the physician. The case is escalated to the physician advisor for a determination, and he or she agrees that the patient does not meet medical necessity. The attending physician and a member of the UM committee agree patient status should not be inpatient. Physician documents observation appropriateness in agreement with the UR committee member. Okay. So, in this case, we are going to, if you will, downgrade the patient to observation and outpatient level of care. And then we can appropriately bill for Condition Code 44 and also give the patient the moon at that time. Next slide. Now, there are some fundamental things we need to know about Condition Code 44. Next slide. There are 11 things. So, these run across two slides. I gave you the reference. Now, it does go back to 2015, but frankly, this is all still relevant and appropriate. So, we saw Code 44. Believe it or not, it goes back to 2004. I don't think until we ramped up with observation status did Code 44 become a thing that everybody talks about now. I mean, I think it was used, but not as greatly perhaps as today. So, prior to Code 44, prior to 2004, if an inpatient admission was not found to be medically necessary, the hospital's only option was to self-deny and bill for a very limited number of eligible ancillary services. So, that was before Code 44. However, when the Code 44 process is used, the entirety of that hospital stay becomes an outpatient encounter. So, this necessitates the use of outpatient hospital as the terminology as the place of service for the professional and hospital claims. The Code 44 process must be completed, including written notification to the patient, there's your moon, before the patient is formally discharged from the hospital. So, that's the linchpin to your Code 44. The patient has to have not been discharged. Now, what CMS uses terminology-wise is defines a formal discharge as when the patient's discharge is effectuated, but has never told us what they mean by effectuating a discharge. So, some folks have interpreted that to mean once the discharge order is written, and others have interpreted it to mean that the patient has physically left the building. I wish I could tell you the answer to that, because I don't know the answer. The decision to use Code 44 must come from a member of the U.R. Committee and must be a physician, osteopath, or other practitioner who is on the hospital staff. So, if your bylaws, your medical staff bylaws, allow, let's say, nurse practitioners to admit and discharge patients, well, then they could perform this particular role. The attending physician must agree with the change from inpatient to outpatient. If they don't agree, the patient remains as an inpatient. Two members of the U.R. Committee can overrule the attending and determine that the admission was not medically necessary, but that admission would remain inpatient and require a self-denial, which we'll talk about. Next slide, please. Number seven, if the patient has been formally admitted, the only process to change their status to outpatient is using Code 44. Even the attending who initially wrote the inpatient admission order cannot unilaterally change the status to outpatient. Now, that's really important, because I've heard some people will say to me, well, the doctor just changed it. You can do that with a commercial payer, but you cannot do that with Medicare. There must be documentation of the physician's concurrence in the chart. And interestingly enough, your U.R. physician, physician advisor or other, does not need to examine the patient, document in the chart, or sign the status order change. So they're really just, you know, being a second-level reviewer. Code 44 changes a patient, as we know, from inpatient to outpatient. So if that patient continues to need hospital care, observation may be ordered at the time of the change, and observation hour counting for billing purposes would begin at that time. The second requirement for Code 44 is that the hospital has not submitted a claim. So number one, the patient can't have been discharged. Second is that the claim has not been sent. Now clearly, that would not likely happen. Although an inpatient has immediate discharge appeal rights with the QIO, the patient has no immediate rights to appeal the change from inpatient to outpatient. So interestingly enough, if the physician advisor at all decides to change this patient to observation, they have no appeal rights in that decision. And I remember years ago, a patient saying, well, I don't agree, and I'm not going to participate. Well, they don't really have an option in that case. Okay, next slide. So all of that has to do with when your patient has not yet been discharged. But using the same scenario and saying, oh, dear, okay, this patient came in. Maybe they came in over the weekend. Somebody did a review. They went to an inpatient bed, and then they were discharged. And now we're doing a retrospective review of this patient, and they do not, or did not, I should say, meet medical necessity. Well, now we can move to this Part B, partial Part B billing. And again, whatever your hospital may call this, it's all the same thing. Provider liable, Code 121, Part B. I've heard so many different names for this, but basically what it is is billing for some charges for a patient who didn't meet medical necessity and has already been discharged from the hospital. So this would involve your physician advisor, but you don't have to have concurrence or documentation by the patient's physician, because the patient has already received the services and has already left the building, as we like to say. Okay. Next slide. So let's just look at how this Code 121 or Part B billing would look. So this is the less-than-perfect world. The patient, darn it, has already left the building. Patient was admitted as an inpatient. The physician's documentation is not in compliance with the two-midnight rule. It's also not in compliance with an inpatient stay, one- or two-day stay without concurrent case manager review. The patient is discharged. The account is placed on hold. The case manager does that retro review after discharge, and we don't see good documentation. And so, therefore, we escalate it to the physician advisor. And then, as I was alluding to earlier, we have to follow this self-denial process. Remember, Medicare has delegated this to us, so whereas your commercial payer would say we're denying the stay, for Medicare patients, if we don't believe the patient met medical necessity, we have to self-deny. So if you want to read more about self-denial, there is some stuff in Medline Matters. You can just search for it. It came out in 2014, effective back in 2013, so this is a while now that this release took place. But essentially, all we're doing is we're saying, okay, you know, we did an audit. This patient didn't meet medical necessity, and we're going to self-deny. Next slide. So we talked about ancillary services. We said when a patient gets downgraded from inpatient observation using Condition Code 44, yes, we may be able to bill for some ancillary services. If the patient gets downgraded further and we self-deny, maybe there's also some stuff that we can bill for. So ancillary services would be paid under your Medicare Part B that we talked about last week. You would only bill for Part B if those services could not be paid under Part A. So in our examples, our two billing examples, we could not bill under Part A because it wasn't medically necessary or reasonable. These are all services that are other than room and board and are furnished by a provider. Next slide. So I just gave you here some examples of some of the ancillary services that would be covered by Medicare Part B. That's not to say they would all be covered. It really obviously depends on the case as to what would or would not be covered. So diagnostic tests, DMA, durable medical equipment, home health care services are all under Part B. Nursing services like wound care, med management, and so forth. The cost of Medicare ancillary services varies depending on the type of the service and the provider. And again, these are covered under Part B. And when you're ever billing anything under Part B, the patient may have to pay a portion of the cost out-of-pocket. The thing about Medicare is it's not a free ride. Patients have to pay deductibles and in this case a co-pay or a portion. So when patients get downgraded observation, it increases their financial liability. Medicare pays 80% of the approved amount of those ancillary services. So the cost out-of-pocket for a patient could be high. It could add up. Okay, next one. Even if the patient's payment doesn't change, you have to have accurate billing. And billing can occur in any location. So I remember back when if a patient was admitted but they never left the emergency department, that you couldn't bill for inpatient. That is not true. If your patient gets admitted in the ED, let's say you're really backed up for beds and the patient stays in the ED and is ultimately discharged from the ED but met inpatient medical necessity, that should be billed as an inpatient. Again, not for you to do, but just to know. So we basically have status, outpatient, OBs, and inpatient, and we have levels of care for billing purposes. So when we put a patient in observation service, that's a status change. And I sometimes mix them up myself, but that's a status change. Okay, next slide. All right, let's talk about the two-midnight rule, the dreaded two-midnight rule, right? When the two-midnight rule came about, and I think it's about 11 years, give or take, at this point, what the two-midnight rule did and the reason CMS did move to the two-midnight rule was because they didn't like the numbers of short-stay patients that were being admitted as inpatients, and they felt that they were overpaying for these short stays by the fact that they were billed as inpatients and paid as inpatients. And they defined short stays as one- or two-day stays. So their goal here was to reduce the number of one- and two-day stays. What they did, too, that was new and different, kind of revolutionary here, was this was the first time that payment was contingent upon specific elements in the physician's documentation. So this was really a different approach to doing this. So it requires that the physician documents his or her expectation that the patient's stay will be either less than two midnights or more than two midnights. So if it's going to be less, there should be an order for observation. If that patient's in observation, then you want to reassess that patient after one midnight and see what the next steps might be. So you really want to keep a close eye on these patients that are in observation from a case management perspective because they may qualify to be admitted or they may need to be discharged. So it really depends on the circumstance that's in front of you. But if you don't look at them aggressively every day, then that decision-making process may get delayed. If the physician says, yes, my patient's going to stay at least two midnights, then there has to be an inpatient order. And as with any inpatient order, this is not unique to the two-midnight rule, with any inpatient order, it has to support medically reasonable and necessary care, and that has to be part of what the physician documents when they admit a patient. Now, inpatient-only procedures are the exception, and I'm going to talk about those in a couple of slides, so we'll hold that thought. Next slide, please. So what the two-midnight rule also did was, my goodness, it put us on a clock in a way that we, other than the three-day stay rule, we hadn't really had this kind of approach to looking at stays exactly this way before. So the two-midnight benchmark clock, if you will, begins when the patient begins receiving hospital services, so that's when it starts. It could start after registration and triage. It could start after observation care is initiated, emergency department care, operating room care, or other treatment services. Next slide. Next slide. So there are some exceptions to the two-midnight rule. It's important for us to know these, and what I would highly recommend, if you haven't already done this, is have this hardwired in your electronic medical record so that your physician has to respond to this, because if they don't document this and you've got short-stay discharges, that could cause an issue with CMS. So CMS says there may be unforeseen circumstances that might result in a shorter stay than the physician's expectation at the start, frankly, when the beneficiary would require a stay of at least two midnights. So the physician documents, I believe my patient will stay at least two midnights, and then there's an unforeseen circumstance that results in a shorter stay. So the exceptions are death, okay, transfer out. So if you need to transfer this patient out, that exempts you from this. Patient walking out against medical advice also exempts you. An unforeseen recovery. Maybe the patient just got better faster than anticipated. Election of hospice care, and then this last one popped up a couple of years ago. New onset mechanical ventilation that is initiated during a visit may be admitted even if the inpatient stay is not expected to remain for two midnights. This exception does not apply because of anticipated intubations during minor surgery or other treatments. So, you know, one example that I thought of with this new onset mechanical ventilation would be the patient comes in maybe as an overdose, they're not breathing well, they get intubated, and then they respond quickly to treatment, and they get extubated. So that would give you an exemption. So CMS never says you're automatically going to get paid. They say they would consider that this may be an appropriate inpatient payment, but there's no guarantees. So these expectations and these unforeseen interruptions in care, as they call it, must be documented in the medical record. That's why I'm suggesting you consider having a dropdown that the physician can use to tick one of these off under these circumstances so you can get paid. Okay, next slide. So after the initial two-midnight rule came out, physicians were really up in arms, and they said that this rule took away their professional judgment, their professional critical thinking, and so forth. And so CMS did come back with a response to that, and they said, okay, there may be some acceptable one-day stays depending on the judgment of the physician. So what they did here was say, you know, the physician in some instances may, in their clinical judgment, believe that this is an appropriate inpatient stay, even though it's a short stay. But the documentation really has to be there to justify it again. They also said they expected these instances to be rare. So you don't want to see a lot of these, you know, one-day stays that are exceptional because that may trigger an audit. And they say they may monitor and review, and it's very easy for them to find them because it comes up in billing, so it's not hard for them to track down any patterns that you might be witnessing in your own hospital. Okay, next slide, please. Let's talk about observation. It's really become a big, important part of utilization management. And as you saw earlier, when we're talking about Condition Code 44 or some of these other issues, the 2 midnight rule, observation becomes an important part of this. And observation service is an outpatient level of care. It's under the outpatient prospective payment system, so it's paid differently than an inpatient stay. And it provides us with a well-defined set of specific clinically appropriate services that would qualify. And when you think about what's right for observation, it's typically rule-outs, work-ups, you know, patients with less complex symptoms. It's signs and symptoms when we don't really know, in some instances, what's wrong with the patient. Or it could be a simple treatment, like an asthmatic treatment or something like that. So ongoing, short-term treatment assessments and or reassessments. And again, your signs and symptoms diagnoses are the ones that CMS was really trying to get out of the inpatient setting and move to observation. So you're going to provide observation services while a decision is being made regarding whether that patient will need to be admitted, receive further treatment as an inpatient, or if they're able to be discharged from the hospital. So I just want to mention, because this has come up more than once in some of my webinars, certainly, you do not want your physician to automatically write for observation following surgery, ambulatory surgery. And I see this all the time. You cannot place, prospectively place, a patient in observation. You cannot assume that they're going to need observation after surgery. The use of observation is based on clinical necessity, and you don't know if that post-operative ambulatory patient is going to need additional observation after that surgery. You have a certain amount of time for recovery after ambulatory surgery. It could be 4 hours. It could be 6 hours. It could even be more than that. It could be up to 12 hours. Only after that would you consider observation if the patient continues to be unstable or nauseous or have too much pain or whatever the clinical issue might be. So if your hospital is doing that, you're doing that incorrectly. And I just want to mention that because I hear that quite a bit. All right, next slide. So let's make sure, as case managers, that we have accurate transition of our traditional Medicare observation service patients. So let's talk about that. As I was saying, we want to make sure that we're really on top of these cases, that we make decisions in a timely manner. So in the morning, you really do want to take a very good, hard look at these patients, maybe with your attending or your hospitalist or whatever the case might be. Patients in observation one midnight and now are meeting criteria to be admitted as an inpatient. And you're going to know that because you're going to have done a review and you're going to get the inpatient order from the physician with the accompanying documentation to support medical necessity. So that's upgrading the patient from observation inpatient. Patients in observation who are not meeting criteria to be an inpatient, well, okay, they should then be either discharged, they should have additional testing as an outpatient, meaning they leave and they have additional outpatient testing. I had a client a couple of weeks ago who was telling me they kept an observation patient longer than they had anticipated because the doctor ordered a speech evaluation. Now, clearly, that could have been done. The patient was in observation outpatient already. That could have been done, you know, after they were released, discharged from observation, as just an example. So outpatient testing, that doesn't have to be done while they're in observation. You want to involve your physician advisor, as we've talked about. And if outpatient is simply not possible, then you're going to closely monitor the observation services the patient's receiving and their response to treatment and discharge them as soon as possible. And you want to, you know, use any other resources you have, which we'll talk about in Module 5, the role of the social worker in the discharge process here. If you have clerical support staff, they can also help to expedite some of this. Next slide. So just some quick math here. What constitutes a 3-day midnight stay? So if you have one obs at midnight and two inpatient midnights, that does not qualify for a 3-day stay because obs, again, is outpatient. So it's very logical. One ED midnight, outpatient. One obs midnight, outpatient. Plus one inpatient does not qualify. So, again, you got to do your math. You got to understand where you are, you know, with the levels of care for these patients. Again, this drives the relationship between discharge planning and utilization management. Okay, I'm taking a sip. Okay, next slide, please. So here's how it might look when you start to integrate utilization management with discharge planning. So starting on the left, the Medicare patient is placed in observation. The MOON would be given at the appropriate time. The Medicare patient is admitted as an inpatient. The important message is delivered. Documentation for at least two midnights, including the reason for the hospital services, must be documented by the physician, appropriate inpatient order, and then care would be delivered. The discharge planning would begin immediately, which we will be talking about. And as per CMS and as per best practice, you want to pull your patient and or their family into the discharge planning process immediately. The second important message would be given within two days of discharge, only if the stay is longer than two days. Discharge order is written, the patient agrees and they're discharged, or if they disagree with the discharge, then they're going to appeal to your quality improvement organization. The detailed notice of discharge would be delivered, and a HIN, if you choose to, would also be delivered. So you begin to see how the stuff you do, the stuff you do under utilization and what you do under discharge planning are very interrelated. The decision-making process is also very interrelated. Next slide. So the perfect world, then, for two midnights. Patient admitted as inpatient with an appropriate order. Case manager reviews the order and the documentation using medical necessity criteria. This is your first-level review. The physician documents appropriately. Yay! If it's a one-day stay, the physician documents the reason for the early discharge. The patient is discharged, and appropriate billing takes place, and everything is right with the world. Okay, next slide. So I just mentioned the important message a couple of times, and another thing I'm hearing out there is some of you guys are giving the first important message as opposed to it being given during the admission process through the registrar in admitting. We really believe that this first message should be given by them, not by case management. The number one most important reason is we're not in the hospital 24-7. The second reason is it's really a clerical function. So the first important message would be given within two days of admission, and the second one, as we said, within two days of discharge. Now, we typically do give the second important message because that second important message may result in the patient appealing their discharge. Next slide, please. Just some updates that are from 2022 from Medicare, important message updates as of April 21st, 2022. They added a formal exception. Any patient electing a hospice benefit, which could either be inpatient hospice or inpatient hospital patient being discharged to hospice, means they do not have to get the important message. Any patient whose status has changed from inpatient to outpatient using Code 44 process, they do not have expedited appeal rights, as I think I mentioned that a little bit earlier. So when you use Code 44, there's no appeal rights for your patient. This update formally prohibits giving the IMM to a patient not formally admitted as an inpatient or whose inpatient admission is pending. So a lot of you guys are just, your departments or your admitting departments just giving the IMM to every patient. Medicare is saying, no, we only want you to give these to appropriately admitted Medicare patients. It can be presented and signed on an electronic screen, but you do have to give a hard copy to your patients. Your follow-up IMM, the second one, must be given no later than four hours prior to discharge. I don't think that's new. I think that's always been the case, but they are emphasizing that. Now, the last one is fun. If delivered, if the IMM is delivered to a representative not present, it should be explained verbally by phone and a copy sent with a method allowing signature verification of delivery. So that could be a fax or an email only if HIPAA requirements are met. So that's a little extra work there, unfortunately, to have to do it that way. Next slide. So you've heard of Advanced Beneficiary Notice, ABN, and certainly you've heard of HINs. Advanced Beneficiary Notices are optional. You don't have to give them. Notice that the outpatient services are or may be denied. I do see some case management departments giving ABNs for observation. After that, observation criteria have not been met. That should be pretty rare, I hope. Hospital-issued Notice of Non-Coverage. This is the HIN, and this is the notice that's given when inpatient services are or may be denied. And again, it is also optional. There is no mandate that you must give a HIN. And so I always like to say you want to be very thoughtful about if and when you do give a HIN. Next slide, please. So the hospital may issue HINs, may, may, may issue HINs to your traditional Medicare patients if the hospital plans to hold the patient financially liable. So if you're not expecting to hold that patient financially liable, then there's no need to give a HIN. There are three basic reasons why and when you would give a HIN. So the patient is either receiving or about to receive non-covered care because it is not medically necessary, not delivered in the most appropriate setting, or is custodial in nature. So those social admissions that really shouldn't have been admitted, you could, in fact, give a HIN for a Medicare patient if you chose to do so. Ensure you have contacted the physician for additional information regarding the patient's case, again, before you would ever issue a HIN. The reason I'm saying all this is because the HIN can be interpreted by a patient or family member as pretty hostile. Unless you've got a difficult situation where you're trying to make a point with that HIN, you just want to be thoughtful about giving it or not giving it. You want to also have a conversation. Well, you want to talk to your physician of record and also your physician advisor, certainly before you ever do issue a HIN because it's something you really want to be thoughtful about. Medicare tells us the patient has to be able to comprehend the HIN. It cannot be delivered where EMTALA applies, and that is usually in the ED. Patient billing must meet CMS requirements, and so billing has to be accurate. And if you're not giving the correct HIN, you can't hold the patient financially liable. So the correct HIN, what does that mean? Next slide. Today we have these four HINs, typically, that we use. Why numbers got skipped, I don't know. HIN 1, pre-admission or admission HIN. So the physician's ordered inpatient medical necessity is not met or the level of care is not appropriate. So this would be prior to an entirely non-covered stay. And, you know, again, you want to think about this, whether or not this is, you know, something you want to do. HIN 10, notice of hospital requested review. So you can use a HIN 10 when you want to request your QIO to review and make a decision. This is basically when you've reached a stalemate, when you, the hospital, basically case management, determines the patient no longer meets inpatient care criteria, but you can't get the concurrence of the physician. So in this case, basically asking your quality improvement organization to break the tie. HIN 11, used for non-covered items or services that would be provided during an otherwise covered stay. So patients being admitted for hip replacement and maybe that they want to have a, and this is an exaggeration, maybe they want to have a tummy tuck at the same time. That is a non-covered service. HIN 12, this is the one you're all probably most familiar with and that you probably use the most. So this is when the patient initially met an inpatient level of care. You, the hospital, you case management, determine that the patient no longer needs an inpatient stay and the physician has made a decision to discharge. So in this case, everybody's in concurrence that this patient should be discharged from the hospital and this would only be used when the patient is appealing their discharge. So in other words, they don't want to go. We all believe they should go. They don't want to go. Once you're going to give the HIN 12, you're going to also give the detailed notice of discharge, which would inform them of their potential financial liability for this non-covered stay and that combination of information will oftentimes move the patient toward discharge. All right, next slide. So let's talk about the Medicare inpatient-only list because things are starting to change with the IPO list. It's been around a very long time. It's been a list of procedures that can only be billed as an inpatient. So the patient is not required to stay in the hospital after the procedure, but if procedure not billed as inpatient, there is no reimbursement. So in other words, if they're on the inpatient-only list, they don't have to stay, but you have to bill it as an inpatient. If you have a Medicare Advantage plan patient, they don't have to follow this list like most of your commercial payers would not. Any procedure not on the inpatient-only list can be performed. And again, at the physician's discretion, inpatient, OBS, or outpatient. So it is important to know. Now, I've been watching this last bit I have on the slide for you today pretty closely because I guess it was a year... No, I'm sorry. It was 2021, 3 years ago. Wow. CMS is part of the final outpatient prospective payment system rule at that time. Now, they would start phasing out the inpatient-only list. And sure enough, they started with 300, mostly musculoskeletal services, which were cut off the list first. And what does that do? That's... Well, hello, that's when we saw knees move outpatient. We saw hips are now moving outpatient because they're off the inpatient-only list. Now, they initially said they would follow with the rest of the inpatient list being removed or ended by 2024. As of yesterday, when I looked this up again, they have not done that. They are moving slowly because they're looking at claims data to determine whether or not they're going to add and what they're going to add to be removed from the list. So it's not over yet. There are still many, many inpatient-only procedures that are still on the list, but they are going to continue to chop away. So this is really a work in progress at this point. Next slide, please. The OIG's work plan as of 2022, I thought I would share. And some of you may remember when those short claims were audited back in 2013, and they said they weren't ever going to do that again, but they are. Remember, we talked about how they had identified millions of dollars in overpayments for inpatient claims with those short stays, which triggered a lot of this stuff. So instead of billing stays as inpatient claims, the OIG believes those claims should have been billed as outpatient. So they plan to audit hospital inpatient short-stay claims again to determine whether those claims were incorrectly billed as inpatient and should have been billed as outpatient or outpatient with observation. So we're not off the hook yet. They are looking at claims again. They're also going to be looking at your, if they haven't already, at your policies and procedures for enforcing the Two Midnight Rule at the administrative level. So hopefully you directors have a policy and procedure for the Two Midnight Rule in your own policy and procedure manual because they clearly could ask for that. Next slide. So the process that they're using for those short stays is probably what they're seeing. I don't have data on this, but probably what they're seeing is a ramping up, again, of the short stays because it's been 10 or 11 years and, you know, people forget. So either Levanto or Keypro, depending on who you are, I love this title, Beneficiary and Family-Centered Care Quality Improvement Organization. It used to be called the QIO. Now it's the BFCCQIO, are the ones auditing the hospitals for these short stays. So they've been given this contract. They are reviewing samples of medical records and they are looking to see whether that record was acceptable or did not meet medical necessity criteria. Then the hospital has an opportunity to review the record and discuss the denial with them, but they make the final determination and they give feedback to case management physicians and physician advisors. So some of you may have been involved in this. And depending on the size of your hospital, they may grab only 10 records. So, you know, if you remember back to what I suggested, that you have a drop-down for your physician documentation when it's a short stay that was unexpected, well, that's the kind of thing they'll be looking for to support that short stay. And so if you don't have that really tight documentation from your physician, then it's likely they're going to say, nope, this doesn't meet criteria. Okay, next slide, please. So the 2 Midnight Rules self-audit process is really important in these examples. Again, traditional Medicare patients with a short stay, you really have to review them for medical necessity before the bill is sent. So here's just an example. The patient is admitted Friday evening and discharged Sunday without a medical necessity review. Your billing department should hold that bill until the review is complete. This is another reason why I like to see case management software with your billing department able to view it, because how do they know that review wasn't completed? Either we have to actively tell them or they have to look in the system and see that one of the other processes has to be there. The case manager then reviews the medical record. Okay, the patient meets medical necessity and the bill is sent and everybody's happy. Or the patient does not meet medical necessity, now you have to go through your process. The physician advisor, member of the UM committee, reviews the record. They agree the patient meets medical necessity, the bill is sent. The patient does not meet medical necessity criteria. Medicare then expects us to self-deny, and then we can bill for some of those Part B services as we talked about a little while ago. So self-audits for the two-midnight rule. Next slide. So what helps us as case management departments to do the very best that we can do? First of all, you want to have the right model, which we'll be talking about, and the right roles, which we'll be talking about. Timely assessments we'll talk about. Integration of the different roles. Even if you have separate UM staff, they have to be integrated into the department, not off-site somewhere. You want to have compliant processes, and we've talked about some of that and we'll continue to talk about that. Timely and appropriate physician communication when a case doesn't meet medical necessity, as well as timely and appropriate conversations with your physician advisor. You want to keep your avoidable delays to a minimum, which we'll talk about. What's the patient's reimbursement model? Today patients can be in accountable care organizations. They can be in one of the bundled payments. Any kind of thing, and we don't always know. Appropriate auditing. So leaders, you directors, you want to make sure you're auditing, whether it's for the two-midnight rule or physician documentation or something else. You want to make sure that you don't have slippage, that things are good, and always a sense of urgency with all of this stuff. Okay, next slide. So when we talk about medical necessity, one of the things you always want to keep in mind is that it should start at your access point, and this is particularly important with the two-midnight rule. So a patient comes in through the ED, which generally, nationally, about 50% of our admissions to hospitals come in through the emergency department. If you're not gatekeeping that route of entry, and I've seen hospitals where some physicians just put everybody in observation or they just admit everybody or they're just really not thinking about levels of care. That's where case management has to come in. Case management has to review the case, discuss it with the physician, and make a decision. Is this observation? Is this inpatient? Or is it neither? That is possible, too. There may be other opportunities to discharge that patient from the ED with some kind of services. And then all those other routes of entry. So what I'm really suggesting is you have another case manager who's covering all these other routes of entry for the same purposes. If you have a transfer center, that's a good place for the person to be. It's not all transfers, but that's a good spot for them to sit. Or they can be in the admitting office. I mean, it doesn't really matter as long as they're gatekeeping all those other routes of entry. It's another position. I get it. But it's an important component in today's world. Next slide. The other thing to be very thoughtful about is your documentation. What to document. So if you're doing a clinical review, as we talked about, you're going to use your critical thinking skills when you want to do that review and give any supporting documentation to the third-party payer. You do not want to copy and paste the record because why open that up for them to find a reason to deny you? Just give them the supporting evidence. And then document your agreement or your disagreement with a concurrent denial as well as the steps you might use to overturn that denial. When do you document? You want to keep your documentation current so everybody else on the team is current. Your frequency is based on your department's policy, the patient's condition, and payer requirements, as we discussed. Use your software, if you have it, to remind you of your next review date and close each account with final approval or denied days. And this is important because, again, if finance is going to look in, you want finance to be able to look in there and see that. That, again, I really advocate for finance having a view only of your case management software for all these different purposes. It really does streamline the processes. And remember, your clinical review does not belong in the medical record. It belongs in case management software, not in the medical record. It is not part of the record. Next slide, please. So there are some optimal roles that I hope you have or you're thinking of having for best practice utilization management, and I've got those emboldened. So on the left, you have the ED, RN case management. You cannot have a contemporary case management department in today's world without having case management in the emergency department. I don't care if you're a critical access hospital or a giant hospital. You have to have case management in the ED for all the reasons we're talking about. It doesn't have to be 24-7. It can be a part in the ED and part somewhere else, but you've got to have some gatekeeping for levels of care and lots of other things in the ED, which we'll be talking about. Admissions case manager or transfer case manager are kind of doing the same thing. A unit case manager, obviously. On the social work side, you want to also have social workers in the ED because the ED can be a discharge place as well as an admitting place, and some of those patients either are readmissions that don't need to be readmitted or admissions that don't need to be admitted, and the social worker can get involved. All those horrible social admissions, patients who should never come in. Social work can play an important role with things like that. And, of course, unit-based social workers. Physician advisor. You love to see a physician advisor who's employed by your hospital and physically present, but in the absence of that, if you use an outside reviewer, at least you have a physician advisor that you can tap into. And then appropriate leadership roles. You want to have a director, but you also want to have support leaders underneath that director. Okay, next, please. Let's talk about these medical necessity reviews and what they actually mean because, again, these are the linchpin. Your clinical reviews are looking for medical necessity, and so we have prospective, concurrent, and retrospective reviews that we do. So let's look at our next slide. Prospective reviews. Next slide. Prospective reviews occur before the services are rendered. So there are some examples for you here. So one of the things your person who maybe is the admitting case manager or the person who's in the transfer center, you know, they're going to do more than just those things. They can also review scheduled surgical cases to be sure that they're going to go into the appropriate level of care, and that goes back to what kind of surgery, whether it should be inpatient or outpatient, whether it's on the inpatient-only list, and all the things that we've talked about. And, again, observations should never be ordered before a surgical procedure takes place. Never, ever, ever. And then are there any pre-op days that aren't meeting medical necessity? Lots of stuff we can do prospectively. Review of patients transferring into the hospital. Again, that's usually a wide-open door. They just come in. Nobody's looking at them. But we should be looking at them, that we have appropriate orders for their status and their level of care and whether they're being transferred to an in-network. And if they're not, that can be an issue for the patient. Okay. Next slide. Concurrent reviews while services are being rendered. So, of course, that's the majority of what we do. We do concurrent reviews. And, again, we talked about how frequently you may or may not be doing them. But your ED case manager, your RN case manager in the ED, can certainly start those. Others can, too, depending on the situation. But, excuse me, the ED case manager probably would be the one most of the time. And making sure that the patient is placed in the appropriate status and level of care, that you're following the 2 midnight rule right from the ED. I can't stress how important that is, that you're managing your readmissions, either that they shouldn't be readmitted, or if they are, what was that root cause? And we'll talk more about that in a few weeks. And then those bundle payment or other alternative payment model patients are identified. That's a tough one. But we have to start figuring out how to do that. Your unit case manager, again, RN, should be doing concurrent reviews also where required to do them anyway. But it's the best way for us to know that the patient is ready to move along toward discharge. So what happens when your stay extends beyond the approved length of stay? That's something you're going to deal with in your concurrent review process, whether it's DRG case, bundle payment case, unfunded or underfunded. I think I may have mentioned last week that when you have a case rate payment like a DRG and then you have a payer asking for daily reviews, it never made too much sense to me, what they argue is, well, we want to see when it's time to, oh, my goodness, discharge that patient. Okay, you know. So what happens is you should be off the hook on daily reviews for case rate contracts, but you're not usually. And then managing those concurrent appeals at the bedside when those happen. Next slide. Retrospective reviews after care has been rendered. Now, we talked about a little bit of that, those short stays, the patient comes in and leaves before anybody has seen them. Now, I put appeals coordinator here because this position, title doesn't matter. I call it appeals coordinator. This is an office position, back office position that helps to support a lot of these things that we have talked about. So they might do audits of your short stays before the bill is dropped. They might look at your self-denials and agreements with the physician advisor. They might be helping with the retrospective denial, so the denials you get after the patient's discharged and the appeal process for those. There's a lot of stuff this position can do rather than depend on the staff on the units to do this stuff, and that takes them away from their daily work. Collaborating with the physician advisor for any cases that didn't meet medical necessity. They can also be really helpful in aggregating denial information and providing that information to case management leadership and others. They are your linchpin with finance, with compliance, and patient access, and if you do have CMS come in or other auditors, they can help coordinate those kinds of things. So this is a position that I always recommend and I give it to you for your consideration. Next slide, please. All right, so denial management is part of utilization management. Frankly, everything we do in case management is really part of denial management if you really think about it, but it does align closely with utilization management. So denial management is the process of monitoring and managing payer reimbursement from pre-admission to post-discharge as part of utilization management. Next slide. I thought these were some interesting statistics. Now, they're a couple of years old, but we don't always get these immediately. There's usually a lag. So the average denial rate is up to almost 12% in the first half of 2022 compared to 10% in 2020, 9% in 2016. So you see a creeping up there. The highest denial rates are in the Pacific with a staggering 17% denial rate followed by the Southern Plains at 12.19%. 82% of denials are potentially avoidable. 82%! and one in five, 20% of these are not recoverable. Now, I don't know that this is going to be a big surprise to any of you, but registration is responsible for the largest percentage of denials that are frequently not recoverable. Georgia, for those of you in the state of Georgia, your denial rates were 10% in 21-22. Next slide. So, obviously, we see some common types of denials. For all denials, meaning... Now, your hospital may call them technical denials or administrative denials, and these are typically denials that aren't related to medical necessity but occur when the hospital does not comply with something in the managed care contract. So, for all denials, pre-cert or auths were required but not obtained. Claim form errors, maybe patient data or diagnosis procedure codes were in error. Claim was filed after the deadline. Insufficient medical necessity. Use of out-of-network provider. Okay. On the medical necessity denial side, inpatient-only surgeries. Now, to me, that kind of is the reverse, but I think that goes up top. Okay. Inpatient order with incomplete documentation in the record to support medical necessity. Concurrent stay denials. Delays in services provided. Now, if you have contracts that are what we call per diem contracts, meaning they review every day, and I see this a lot in our critical access hospitals, they review every day, and that means if you're not providing an acute level of care on Saturday or Sunday or a holiday, they will not pay you for those days. Treatment not approved by the payer could also result in a denial. Next slide. So I don't necessarily agree with all of this, but I'm going to tell you in this data that I'm sharing with you, I just highlighted the ones that I thought might have a relationship to case management. So number three, medical documentation request. That's really more of an administrative issue, but it's possible, you know, that we might have to send something. So number seven, medical necessities, only 6% of all denials. Avoidable care, 1%. So I added those three up, and I said 21% are related to case management. However, if you take out medical documentation request, that brings us down to 7%. So look at all the other ways in which denials can happen. So we get blamed a lot for denials. We're somehow responsible, like length of stay, similar, and yet look at all the other reasons that denials occur that are outside of our scope of responsibility. I think it's an interesting slide. Next slide, please. And then I mentioned the preventable slide. Did you hear that, Lindsay? The preventable slides. Some denials are preventable. So many departments are responsible. We just saw that. So you're going to get reg errors, you're going to get medical records denials, then you have case management, then you have billing. What I started to do when I was a director of case management was actually report on these denials, putting the administrative denials separate from the case management slash medical necessity denials, and that really is a telling tale when folks see the data that way. So look at this. Of the 31% that were unequivocably avoidable, 43% in this example could not be recovered. I see different stats depending on where I'm pulling up the information. But let's say it's true, 43% of your denials were not recoverable because you did not follow, not you, but somebody in the hospital, did not follow your own managed care contracts, which the hospital has agreed to. So this is why we have to see that part of the contract, because look at the denials that can ensue when we don't even know what the rules are. So prevention, of course, is the key to preventing that revenue loss, clearly. Next slide. Or next denial, whichever. So some samples. And when you catalog, when case management catalogs its denial reasons, if you take them from your finance department, finance just takes them. They're going to have technical denials in one bucket, and then they're going to have medical necessity denials in another bucket. That does not help case management in terms of identifying the root causes of the denials and trying to correct for them. So this is why I provided you with this list, because now you can take a look at this list and you can say, okay, I want to review every denial letter. I am going to put the patient's denials into a more specific category or categories. So is it medical necessity on admission? Was it a continued stay denial? Was it a HIN issued incorrectly? Was it a delay in service or treatment those weekends? Did we do a self-denial? Because we really should report those within the organization. Did the payer say they didn't receive clinical information from us? Was the prior authorization not completed, if that was our responsibility, and the patient did not meet observation service? So these are much more specific denial reasons that I think are much more helpful in terms of our work and our ability to correct for some of this stuff. Next slide, please. So medical necessity denials can occur anywhere, but particularly and most likely during the admission process. So if you don't do your initial assessment on the day of admission and it's not done appropriately throughout the stay or the patient is admitted and discharged before the assessment is completed, well, that can potentially result in a denial, or if the patient is put in the wrong level of care or status on admission or during the stay. And then thirdly, as we've talked about, if the two midnight rule requirements and documentation are not there in the record, that can also result in Medicare denial. Okay, next. More steps in the admitting process where medical necessity denials can occur. Inaccurate payer information by registration. Well, we just saw how critical registration is, and yet how often do the staff in registration get feedback when these errors occur and the impact downstream of those errors? Not that often, I'm guessing. That's a project, and it's a really helpful one because they may not understand or recognize or appreciate how those errors can impact on organization. Inpatient-only procedures not placed as inpatient. Not knowing the payer and benefit plan. Not asking the physician for additional documentation, so it kind of slipped by. Or not appropriately including your physician advisor when you do need that additional documentation. Next slide. And then the care coordination process where medical necessity denials can happen. Maybe the patient's out of network and we didn't look to transfer them appropriately. No sense of urgency. Things are kind of just moving at their own pace. Weekend delays, so it could be ancillary services or case management, skeleton staffing on the weekend. Clinical information gets to the payer late or it's incomplete, and then not closing out that account. Next slide. So we always want to... I think we went one too far now. Yeah, can we go back? Yeah, there we go. Nope. There we go. Okay. Not collaborating with your physician for additional medical record documentation can result in a denial. Not using your physician advisor appropriately, as we've talked about. Those concurrent denials, you sometimes want to get a peer-to-peer discussion going with the payer's medical director. This can be tough when you're using an outside physician advisor. So, again, easier when it's an in-house physician advisor. And then coordinating care, facilitating care. Those delays in treatment can result in a denial. Next slide. And your discharge planning has to be timely and it has to correlate with your utilization management process. So next week we'll be talking in depth about discharge planning, but just to say, you know, poor discharge planning, slow discharge planning, slow assessments all can result in denials. Next slide. So we want to understand denials. You may not be the one who's appealing those denials, but you should be getting feedback from your director so that you can help to prevent that denial, that kind of denial from happening again. So why was it denied? Can it be appealed? Did we make a mistake? And if so, appeal and then prevent. And in order to prevent, you have to know what happened and what you can do to fix it. Next slide. So what was the root cause of that denial? And this is where that back office position, that appeals coordinator position, can be really helpful because that person can review it, come up with that root cause, and then who had the greatest impact on that particular denial. Was it the physician? Was it case management? And so forth. And it's potentially possible that anybody on this list could impact on that denial because we just saw all the kinds of denials and kinds of issues that can happen. So you guys need to have that feedback so you know what the heck's going on. So next slide. Did we make a mistake? Does that medical record documentation support reimbursement? That's your first question. And if you did your due diligence and did your clinical review, you would know the answer to that. Is the billing correct for the level of care? Maybe a billing error occurred. Is the status, inpatient, outpatient, or observation correct and matching authorizations? Did we send clinical information in a timely manner? Did we send the correct records, if requested? Some of these belong to us and some don't, but never assume your payer is correct. It may sound logical, but we have to do checks and balance ourselves on these, and again, that position can do that. Next slide, please. So again, you've got technical administrative denials on one side and medical necessity denials on the other. So we specifically focus typically on the right side, the medical necessity denials, because that's stuff we can impact on going forward and correct. Next slide. So for concurrent denials, you're really managing those at the bedside, right? So it's going to come in while that patient is still in hospital. Sometimes it's given directly to the patient as well. Most times I think it's sent to the patient, but usually sent to their home and they're in the hospital, so it's just interesting. You're going to discuss it with the physician, discuss it with the physician advisor. If you agree, document it in your case management software, but not in the medical record. You need to also understand the denial and appeal process from the payer's contract. You have to know what that is. So if you do not agree with the denial, can a peer-to-peer be done? They may tell you, I've seen some managed Medicaid contracts where there is no peer-to-peer provided. Will the physician do a peer-to-peer with the payer medical director? That's a question. If the physician will not do it, can the physician advisor do the peer-to-peer? I think peer-to-peer is when we really believe that that denial, that concurrent denial is incorrect, can be very effective, because that verbal conversation from your PA to that payer oftentimes will overturn that concurrent denial. If the peer-to-peer is available and the denial occurs, well, you can appeal during hospitalization. You can also appeal after hospitalization. Again, don't put this stuff in the medical record. Keep your physician and physician advisor in the loop as you go through all of this as well. They should know what's going on because it's also a way for them to learn what was denied, why it was denied, and how to correct it on a go-forward basis. Next slide. So I leave you with this. I don't know if this is a Fourth of July fireworks or what this is, but a sense of urgency at every step. So we have to be like a dog with a bone. We have to continuously keep pushing, pushing, pushing in our utilization management. This is not a passive sit back as we started off today talking about, just looking through charts and cutting and pasting. This is an active process. So the next few slides are some of the references from what we talked about today. And, Lindsay, I'm going to turn it back to you, since I can't do anything with the screen anyway. I have to tell you, it's funky when I can't move my own slides, but we did it. I know. We did it. We made it through. Thank you. Thank you, Lindsay. You were great. Very good. Absolutely. And everybody has access to these slides, and so, again, we apologize. If you hung on with us and you waited for a few minutes at the beginning, we apologize for our technical difficulties, but we got it going there. And I did just post some information there for you all in the chat, in addition to the slides. So you have that there that you can pull up and use as a resource. But then just a reminder that you will receive an email tomorrow morning. Just note that if you possibly didn't join us for part one, you're not familiar with this process, that email will come from educationnoreplyatzoom.us. And so because it comes from that Zoom email account, they very often seem to get caught in your spam or quarantine folders. So if you don't see that email in your inbox in the morning, I would just encourage you to check those additional folders. And then if it's still not there and you'd like to just go back and access the recording, we do record these sessions as on-demand meaning that you can use that same Zoom link to access the recording that you also use to join the live presentation. And you'll have access to that recording for 60 days from today's date. And then we do have an additional security measure in place so that we're protecting Dr. Sesta's intellectual property here. So when you click on that Zoom link, you will need to enter your information, and that will prompt an email to come to us for approval of that recording access request. We do approve those very quickly, but we ask that you give us just one business day to grant those approvals. And then also included in that email tomorrow morning will be a link again to the slides, but you do have that there in the chat now as well. And if you're joining us as a member of the Georgia Hospital Association, just remember that at the conclusion of the entire series, we will get information to you regarding continuing education credits. And if you're joining us as a member of a partner state hospital association, please reach out to your contact at your association to obtain that information regarding CEs. And I know that we are right at noon here, and there are a couple of questions here in the Q&A, Dr. Sesta. So if you'd like, we can just kind of run through these quickly, or I can possibly follow up with you all separately as well. But I'm going to just pull up a couple of these and see if we have a moment to go through those, if that's okay, Dr. Sesta. Absolutely. Okay. So this first question says, what if the attending physician agrees and orders a change in status? Does it still go to the physician advisor? No. Well, it depends. It depends on the payer. If it's a commercial payer, no. I mean, you can just do that yourself, not you personally, but the hospital can do that. If the physician of record agrees and you're going to change the status you do need to, and it's a Medicare patient, excuse me, then, yes, you do need to talk to the physician advisor. Okay. This next question says, when using the second UM committee member, does that need to be done at the URC meeting, or can that be done and documented immediately? Could you read that again? Yeah, and it may be worded a little bit differently. It just says, when using the second UM committee, it says member, but I'm not sure. Does that need to be done at the URC meeting, or can that be done and documented immediately? No, it should, if I'm following the question, it should be done immediately. And whoever asked that, if there's more detail behind your question, you can certainly email me, because I don't want to give you a quick answer, but, no, it should be done immediately, if I'm understanding it, yeah. Okay. Yep, and I see that came in from Jeannie. So if you want to reach out to Dr. Sista, you're more than welcome to do that, or you can send your question and additional details over to education at gha.org, and we'll be happy to help if we can. Okay. Okay, so this says, we take all billing code 121 cases to the URC committee for a second review after our PA reviews. Is that URC committee step needed? You don't have to do that. I don't know that it's a bad idea. It's not a requirement. They don't really specifically say exactly what you have to review. It's up to your discretion. But if you're getting a lot of that, which you shouldn't, frankly, that should be an exception, not the rule. So if you're getting a lot of those, I think it's a great idea to bring it to the UM committee because, you know, there may be issues that have to be addressed. It could also be issues in the case management process, too, if you're not catching these. It could be staffing. It could be other things. So if you're having a lot of that, I would definitely want to do a little project on that and see what's going on there because you shouldn't have that many of those. It's costing the hospital a lot of money. Gotcha. Okay. And then it says, to clarify Condition Code 44, if a patient is admitted as an inpatient but only meets observation status, would you still use a Condition Code 44 or only if the patient does not meet either one, inpatient or observation? Okay. So for Medicare only, again, if the patient is admitted, does not meet medical necessity for an admission, you have the option of downgrading them to observation if they meet observation criteria. If they don't even meet observation criteria, then they should be discharged, period. So it depends on these different scenarios. But Code 44 is only used for patients who are still in the hospital and have not yet been discharged. Otherwise, you have to go to that Part B, Code 121 that was just mentioned, and, again, every time you drop down, be it to observation or be it to Part B billing, you're taking away a tremendous amount of money from that stay. And you've already provided the service. So you really do want to get it right at the front because you're going to treat that patient as an inpatient and then not get paid for it. So it's something you want to avoid if possible. And again, I hope I answered that question. Yeah, absolutely. Just a follow-up question here for that is, are Condition Code 44s for traditional Medicare only or also managed Medicares? No, it's really traditional Medicare. Medicare Advantage does not have to follow this because it's a managed care plan. You know, the same logic applies, yeah. Okay. Is it the recommendation that MCG reviews not be scanned into the patient's chart? How should we handle it if we don't have separate case management software? Yeah, I get asked that question. Usually in your medical record, the reason we don't want it in the record is because it should be non-discoverable. What does that mean? That means that if there should be a lawsuit or a legal action of any kind, we do not want to telegraph our clinical reviews to an attorney or somebody else. So we do not want them in any part of the record that's discoverable. Case management software is non-discoverable. So is your quality section of your EMR or wherever your quality department may keep its data. So if you don't have case management software, you need to find out from somebody in the organization what section of your EMR is non-discoverable and they can go there because you probably do want to keep them somewhere, but they should not be in the clinical medical record. So there should be another place somewhere that's non-discoverable. And that really is important, really important. So I appreciate that question. Perfect. Okay. I know we're a few minutes over here and I don't see any other questions, so I'm glad that we got through those, but I did post there in the chat. If you have additional questions, don't hesitate to reach out to us at education at gha.org. And of course you see Dr. Sesta's contact information here on the screen. I know she's happy to help as well. And we look forward to having you all back with us next week for part three. And I hope you all have a wonderful week. Thank you so much, Dr. Sesta. Thank you. Thanks everybody. See you next week. Bye-bye. Alrighty. Bye-bye.

Tony Sesta

Case Management Concepts

case management

utilization management

compliance

best practices

regulatory expectations

CMS

healthcare quality

cost control

care coordination

transitional planning

Condition Code 44

Part B billing

case management software