Are Your Inpatient Admissions Properly Documented?

05/03/11 - Life at NYULMC

Regulatory auditors—including the Recovery Audit Contractors (RAC) and Medicare Administrative Contractors (MAC)—are giving increased scrutiny to the medical necessity of an inpatient admission. Although hospitals already use screening criteria, such as Milliman and Interqual, to confirm the medical necessity determinations made by admitting physicians, a recent CMS Guidance allows RAC and MAC auditors to use their own clinical judgment to overturn an inpatient admission, even when the admission is confirmed as appropriate by Milliman or Interqual.  

The CMS Guidance (Medlearn Matters #SE1027) states that RAC and MAC contractors can use criteria other than Interqual or Milliman to determine whether an inpatient admission met medical necessity requirements. The Guidance states that the RAC/MAC contractors’ medical necessity reviews should include the contractor’s own clinical judgment as well as reviews of Medicare coverage guidelines, invasive procedure criteria, CMS coverage guidelines, coding guidelines and practice guidelines widely accepted by the medical community.  

The RAC Demonstration Program has identified certain high-risk medical necessity inpatient hospital vulnerabilities (demonstrated in the chart below). The RAC has denied millions of dollars in claims associated with these inpatient stays because the documentation in the medical record did not support an inpatient level of care. The documentation did not contain sufficient information to support the diagnosis, the treatment/procedures ordered, course of care, treatment/diagnostic test results and demonstrate continuity of care among healthcare practitioners. 

The physician is responsible for making the decisions to admit the patient, using complex medical judgment that takes into account a number of factors, such as the patient’s medical history, other conditions and current medical needs. Factors that must be considered in the admission decision, and documented in the medical record, are:

• The severity of the signs and symptoms exhibited by the patient,
• The medical predictability of an adverse outcome to the patient, and
• The need and availability of diagnostic tests. 

The Medicare Program Integrity Manual indicates that the medical record must indicate that inpatient hospital care was medically necessary, reasonable, and appropriate for the diagnosis and condition of the patient at any time during the stay. The patient must demonstrate signs and/or symptoms severe enough to warrant the need for medical care and must receive services of such intensity that can only be provided safely and effectively on an inpatient basis. 

RAC and MAC contractors are looking for clear demonstration in the medical record that inpatient hospital care was medically necessary and appropriate for the diagnosis and condition of the patient. Case managers, clinical documentation specialists, physicians and other clinical staff involved in the admission process should review the CMS Manuals and Guidance to improve on existing clinical documentation.