2 day rule
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Hope this helps. You can find find full detail on the Federal Registry.
Under the Final Rule, CMS codified the definition of an inpatient admission at 42 C.F.R. § 412.3. An inpatient admission is appropriate and payable under Medicare Part A when:
•The patient is formally admitted to the hospital pursuant to an order for inpatient admission by a physician or other qualified practitioner1 eligible to admit;
•The order is present in the medical record and is supported by the physician admission and progress notes; and
•The physician certifies the services are required to be provided on an inpatient basis, and the certification must include: ◦The order for inpatient admission;
◦A documented reason for the inpatient hospitalization for either inpatient medical treatment or diagnostic study, or special or unusual services for cost outlier cases; and
◦A statement that the inpatient hospital services were provided in accordance with new section 42 C.F.R. §412.3 (i.e., the order).
Importantly, CMS clarified in the Final Rule that there are actually two distinct 2-midnight policies:
•A 2-midnight benchmark, which gives guidance to admitting practitioners and reviewers when determining whether it is appropriate to admit on an inpatient basis; and
•A 2-midnight presumption, which states that claims for inpatient services with lengths of stay greater than 2 midnights after an admission order will generally be presumed to be appropriate for payment under Medicare Part A.
The 2-midnight benchmark states that if the physician admits a Medicare beneficiary as an inpatient, with the expectation that the beneficiary will require care that “crosses 2 midnights,� Medicare Part A payment is “generally appropriate.� In the Final Rule, CMS makes clear that the admitting physician should consider all time spent at the hospital, including time spent receiving initial outpatient services, when estimating the beneficiary's total expected length of stay.
Similarly, the 2-midnight presumption states that a Medicare external review contractor auditing a medical record will presume that an inpatient hospital admission is reasonable and necessary (and therefore payable under Part A) if a beneficiary requires more than one “Medicare utilization day� (i.e., an encounter crossing 2 midnights) and receives medically necessary services, such as a surgical procedure or diagnostic test after the inpatient admission. Conversely, services spanning fewer than 2 midnights and not involving “inpatient-only� services would not receive the benefit of the 2-midnight presumption. However, contractors may consider time that the beneficiary was in the hospital receiving outpatient services prior to inpatient admission when determining whether the inpatient stay was reasonable and necessary.
The Final Rule specifies the following additional caveats:
•The 2-midnight admission guidance and other medical review criteria for determining the general appropriateness of inpatient admission and Part A payment apply to all hospitals, critical access hospitals and long-term care hospitals, but not to inpatient rehabilitation facilities.
•The time a patient spends in the hospital before the formal inpatient admission order is outpatient time, not inpatient time. However, per above, hospitals and contractors can consider this pre-inpatient admission time in determining whether there is a reasonable expectation of the patient staying over 2 midnights, as part of an admission decision.
•Since procedures designated as inpatient-only are deemed statutorily appropriate for inpatient payment, inpatient-only procedures are excluded from the 2-midnight benchmark.
The Final Rule responds to hospital requests for additional guidance concerning when inpatient admission is appropriate and payable by Medicare. It is effective October 1, 2013