Medicare Compliance & Reimbursement

CMS' three-day 'window' can make or break rehab facilities' billing.

The HHS Office of Inspector General's 2005 Work Plan singles out interrupted stays as a top target area for inpatient rehab facilities. IRFs will need to keep a close eye on screening and discharge practices and will need to input the right patient status codes to keep the OIG out of their hair in the coming year.

Here are the basics on CMS' definition of interrupted stays and transfers in IRFs:

An IRF interrupted stay is when "a Medicare inpatient is discharged from the IRF and returns to the same IRF within three consecutive days. The duration of the interrupted stay begins with the day of discharge from the IRF and ends on midnight of the third day," according to 42 CFR 412.602(3).

An IRF transfer occurs when the facility transfers a patient "to another IRF, an acute-care prospective payment hospital, long-term care hospital or a nursing home that qualifies to receive Medicare or Medicaid payments," CMS states (42 CFR 412.602). IRFs must use specific patient status codes to identify such claims (42 CFR 412.624[f]). Learn From One IRF's Mistakes This scrutiny of IRF interrupted stay and transfer practices for next year comes in the wake of the OIG's 2004 audit of Weldon Rehabilitation Hospital, a facility that provides inpatient rehab services in Springfield, MA.

The OIG specifies that an audit turned up 47 claims with incorrect patient status codes for patients who were transferred to either SNFs or acute care hospitals. Specifically, the facility's coders were entering an internal billing code ("APP") that did not translate to the correct status code in the claim, the report maintains.

What this means: "If the billing system interprets the patient status code incorrectly, then it's being reported to Medicare incorrectly, and your reimbursement will be inappropriately high," observes Marvel Hammer with MJH Consulting in Denver.

The OIG also found Weldon billed two claims for one IRF interrupted stay - and inappropriately received two Medicare payments. Many IRFs are treating interrupted stays as two separate and distinct patient stays - and the higher reimbursement raises the OIG's eyebrows, Hammer says.

The bad news: In addition to paying back more than $200,000 to Medicare for non-compliant claims, the OIG recommended that Weldon implement policies and train staff in correct patient status coding and monitor billing practices for interrupted stays.

Confusion over how to handle CMS' three-day window for interrupted stays - the patient must return within three consecutive days - is often where the problems start that lead to an OIG audit.
 
"When a patient returns to the IRF within the next three days, staff frequently treat the return as a new admission, but this would be an interrupted stay," confirms consultant Denese [...]