Hospital Admissions: Combining Two into One Doesn’t Add Up

Should hospitals combine two admissions into one? In the absence of CMS guidance, hospitals are urged to do the right thing.

Today I have a confession to make. For the last five years, I have been lying.

Now, don’t get me wrong; I have not been doing it on purpose. In fact, I had a very noble purpose for saying what I have been saying. But the time has come to confess.

What have I been saying? Let me use a case example to illustrate. Say a patient is admitted as an inpatient with pneumonia. They receive antibiotics and fluids and seem to improve. On day five, the patient has a follow-up chest X-ray and is discharged home. But the patient returns to the emergency department (ED) the next day with shortness of breath.

The ED doctor looks at the chest X-ray from the day of discharge and notes that the patient had developed a pleural effusion. Furthermore, the discharge vital signs were not normal. The patient is admitted again as inpatient, staying another week.

It was clear that the first discharge was inappropriate; the patient was not stable enough to go home. Now, here is my confession: I have been advising hospitals to combine these two admissions into one. If the readmission was their fault, it did not seem right that the hospital should bill for it and get a second diagnosis-related grouping (DRG) payment.

But unfortunately, there is no guidance from the Centers for Medicare & Medicaid Services (CMS) that allows hospitals to do that. The Medicare Claims Processing Manual tells hospitals to combine admissions when the patient is readmitted on the same calendar day for a related reason, and it also allows hospitals to combine two admissions if the second admission is planned and the patient is placed on a leave of absence. CMS also tasks each Quality Improvement Organization (QIO) with reviewing readmissions, and they can deny the second admission if they feel the services should have been provided during the first admission – but only upon retrospective review.

So since there is no Medicare guidance on how to bill a readmission when the first admission is premature, what should a hospital do? Well, I see three potential billing scenarios. The first would be to go ahead and use the planned readmission billing guidelines even though the readmission was not planned. The second would be to bill the second admission as a no-pay 110 claim so that the diagnoses and procedures could be entered in the common working file to be used for calculations of quality measures. The third option would be to follow the regulations to the letter and bill the second admission and collect both DRG payments.

Billing a no-pay 110 claim may be appropriate in some cases, but only if the hospital’s actions clearly caused the readmission, such as sending a patient home with the wrong medications. But technically, there is no Medicare manual provision that allows that. Collecting two full DRGs just seems wrong. So in many cases, the most rational way to bill would be to combine the two admissions into one. But is it allowed?

I contacted two Medicare Administrative Contractors (MACs), and neither could tell me if two admissions could be combined or if a hospital was permitted to submit a no-pay claim in this situation. The MAC representatives said their best answer was to follow the regulations as written, bill two admissions, and accept two payments.

So from now on, my response to this situation will be to decide if the second admission was fully preventable – and if so, to bill it as a payable claim, but also call the QIO to self-report it. If the readmission was not preventable, then I still would recommend combining them because it is the right thing to do, but I would admit that I don’t know how that is done.

Although I understand that the Medicare manuals cannot possibly address every billing scenario, it should not be so hard to do the right thing. 

Print Friendly, PDF & Email
Facebook
Twitter
LinkedIn

Ronald Hirsch, MD, FACP, ACPA-C, CHCQM, CHRI

Ronald Hirsch, MD, is vice president of the Regulations and Education Group at R1 Physician Advisory Services. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute-care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices and is a published author on the topic. He is a member of the Advisory Board of the American College of Physician Advisors, and the National Association of Healthcare Revenue Integrity, a member of the American Case Management Association, and a Fellow of the American College of Physicians. Dr. Hirsch is a member of the RACmonitor editorial board and is regular panelist on Monitor Mondays. The opinions expressed are those of the author and do not necessarily reflect the views, policies, or opinions of R1 RCM, Inc. or R1 Physician Advisory Services (R1 PAS).

Related Stories

Understanding the Wright Approach

Understanding the Wright Approach

Concern about hospitals sharing space has caused angst for several years. But as reiterated by Centers for Medicare & Medicaid Services (CMS) official David Wright,

Read More

Leave a Reply

Please log in to your account to comment on this article.

Featured Webcasts

Leveraging the CERT: A New Coding and Billing Risk Assessment Plan

Leveraging the CERT: A New Coding and Billing Risk Assessment Plan

Frank Cohen shows you how to leverage the Comprehensive Error Rate Testing Program (CERT) to create your own internal coding and billing risk assessment plan, including granular identification of risk areas and prioritizing audit tasks and functions resulting in decreased claim submission errors, reduced risk of audit-related damages, and a smoother, more efficient reimbursement process from Medicare.

April 9, 2024
2024 Observation Services Billing: How to Get It Right

2024 Observation Services Billing: How to Get It Right

Dr. Ronald Hirsch presents an essential “A to Z” review of Observation, including proper use for Medicare, Medicare Advantage, and commercial payers. He addresses the correct use of Observation in medical patients and surgical patients, and how to deal with the billing of unnecessary Observation services, professional fee billing, and more.

March 21, 2024
Top-10 Compliance Risk Areas for Hospitals & Physicians in 2024: Get Ahead of Federal Audit Targets

Top-10 Compliance Risk Areas for Hospitals & Physicians in 2024: Get Ahead of Federal Audit Targets

Explore the top-10 federal audit targets for 2024 in our webcast, “Top-10 Compliance Risk Areas for Hospitals & Physicians in 2024: Get Ahead of Federal Audit Targets,” featuring Certified Compliance Officer Michael G. Calahan, PA, MBA. Gain insights and best practices to proactively address risks, enhance compliance, and ensure financial well-being for your healthcare facility or practice. Join us for a comprehensive guide to successfully navigating the federal audit landscape.

February 22, 2024
Mastering Healthcare Refunds: Navigating Compliance with Confidence

Mastering Healthcare Refunds: Navigating Compliance with Confidence

Join healthcare attorney David Glaser, as he debunks refund myths, clarifies compliance essentials, and empowers healthcare professionals to safeguard facility finances. Uncover the secrets behind when to refund and why it matters. Don’t miss this crucial insight into strategic refund management.

February 29, 2024
2024 ICD-10-CM/PCS Coding Clinic Update Webcast Series

2024 ICD-10-CM/PCS Coding Clinic Update Webcast Series

HIM coding expert, Kay Piper, RHIA, CDIP, CCS, reviews the guidance and updates coders and CDIs on important information in each of the AHA’s 2024 ICD-10-CM/PCS Quarterly Coding Clinics in easy-to-access on-demand webcasts, available shortly after each official publication.

April 15, 2024

Trending News

Happy National Doctor’s Day! Learn how to get a complimentary webcast on ‘Decoding Social Admissions’ as a token of our heartfelt appreciation! Click here to learn more →

SPRING INTO SAVINGS! Get 21% OFF during our exclusive two-day sale starting 3/21/2024. Use SPRING24 at checkout to claim this offer. Click here to learn more →