Hospitals Are Still Confused About Inpatient vs. Observation

It’s been nearly four years since the Centers for Medicare & Medicaid Services announced its Two-Midnight Rule, but hospital staff still are grappling with the gray areas in the rule. Some hospitals classify patients as receiving observation services if their status isn't clear-cut, potentially increasing patients' out-of-pocket expenses and making them ineligible for a skilled nursing stay. Hospitals should have case managers at all entry points to ensure that patient status is correct up front. Case managers should conduct self-audits of short-stay patients before the bill drops, make corrections, track the self-denials, and educate physicians on where the mistakes are. Case managers should work with physicians to ensure documentation is complete on all patient records, but especially those with short inpatient stays.