By Sandra Salley, RN, MSN, CHCQM
Why do we care about patient status, documentation, and complying with recommended guidelines?
It’s how the hospital and therefore “we” get paid. Although patient care is the number one priority, I like to say that most nurses wouldn’t be caring for patients if they didn’t get a paycheck. Utilization review (UR) is the process of reviewing an episode of care. The review confirms that the insurance company will provide appropriate financial coverage for medical services. The UR process and the UR nurse facilitate minimizing costs.
What do UR nurses do?
UR nurses speak a different language than most other bedside nurses. In all settings, to justify payment or suggest an alternative status, the hospital UR nurse and the insurance UR nurse first discuss medical necessity criteria. If there is disagreement between the nurses about status and therefore payment, then the physicians discuss medical necessity during a scheduled peer-to-peer conference. If there is still a disagreement between the physicians, then the hospital appeals the case with the insurance company.
Why do we follow a UR process?
The UR process is necessary to treat patients. Hospitals cannot admit Medicare beneficiaries without a UR plan. The Code of Federal Regulations (42 CFR 456 and 42 CFR 482.30) and the Medicare Benefit Policy Manual provide the guidelines that the hospital and the insurance company must follow (U.S. Government Publishing Office, 2020; Centers for Medicare and Medicaid Services, n.d.).
What are the most common guidelines that hospitals use?
Acute inpatient hospitals use Milliman and InterQual criteria to help determine the appropriateness of care. Both sets of criteria are evidence-based screening tools used by providers and insurance companies. They do not substitute for the physician advisors’ professional opinions when determining medical necessity. If there is a disagreement between the insurance company and the provider, the insurance company may issue a denial. If so, physician advisors discuss the case during a peer-to-peer conference. If after this conference there is still a disagreement, the hospital can file a written second-level appeal with the patient’s permission. Some insurance companies (e.g., United, Aetna, Cigna, AvMed, Humana) use the Milliman language, while others (e.g., TRICARE, Blue Cross, Sunshine State) use the InterQual language. It is beneficial to know how to use both tools.
What do all nurses need to know about this process?
Documentation is of the utmost importance. It is important to document objective information. Often, reviews will start with the present situation provided by the nurse’s note. This note often includes oxygen saturation, oxygen administration mode, pain, intake, output, and abnormal signs or symptoms. The physician note should contain past medical history and other relevant information such as the plan of care. This information is consulted when deciding status/payment. Although nurses treat all patients equally despite payment, it is important for nurses to be conscious of payment and for patients to know how they will be billed. Also, insurance companies usually pay substantially more when the patient is in inpatient status.
Does Medicare/CMS (Centers for Medicare and Medicaid Services) care about Milliman or InterQual criteria?
CMS recommends admission guidelines as one of many factors to consider when making an admission decision, but it does not endorse any particular criteria or assign specific authority to them. Medicare started issuing a paper notification to observation (Medicare Part B) patients, called the Medicare Outpatient Observation Notice (MOON). Patients in observation status usually pay a percentage of the hospital stay cost (usually 20%), known as a coinsurance payment (Medicare.gov, n.d.). Patients in inpatient status (Medicare Part A) pay a deductible for their stay, which for 2020 is $1,408 (Centers for Medicare and Medicaid Services, 2019). Commercial insurance has similar guidelines. Sometimes the inpatient deductible can be less than the 20% coinsurance in observation status. A Medicare patient has to have a three-day qualifying stay for Medicare to pay for a SNF stay. Neither the hospital stay nor the SNF stay can be considered custodial in nature. Medicare pays for the first 20 days of a hospital stay. After 20 days, the patient is responsible for a daily deductible for days 21–100 (currently $176 per day). If the patient has secondary insurance, both Medicare and the secondary insurance will cover the 100 days per episode of care.
Sandra Salley works in utilization management at Baptist Medical Center in Jacksonville, Florida. She has 12 years’ experience in utilization review covering acute medical, inpatient rehabilitation, behavioral health, and acute pediatric patients.
Centers for Medicare and Medicaid Services. (n.d.). Medicare Benefit Policy Manual. https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Internet-Only-Manuals-IOMs-Items/CMS012673
Centers for Medicare and Medicaid Services. (2019, November). 2020 Medicare Parts A and B premiums and deductibles. https://www.cms.gov/newsroom/fact-sheets/2020-medicare-parts-b-premiums-and-deductibles
Medicare.gov. (n.d.). Inpatient or outpatient hospital status affects your costs. https://www.medicare.gov/what-medicare-covers/what-part-a-covers/inpatient-or-outpatient-hospital-status
U.S. Government Publishing Office. (2020). Electronic Code of Federal Regulations. https://gov.ecfr.io/cgi-bin/ECFR?page=browse