2020 OPPS final rule: 2-midnight audit relief in sight for certain procedures

November 6, 2019
Medicare Web

Along with its annual updates to the inpatient-only list, the 2020 Outpatient Prospective Payment System (OPPS) final rule finalized a proposal that will give hospitals a grace period to adjust internal policies for procedures recently removed from the inpatient-only list.

CMS is establishing a two-year exemption from Recovery Audit Contractor (RAC) patient status and 2-midnight rule noncompliance reviews for procedures that are removed from the inpatient-only list. In addition, these procedures will be exempt from site-of-service claim denials. The exemption becomes effective January 1, 2020, and applies to procedures removed from the inpatient-only list in the 2020 OPPS final rule.

During this two-year period, Beneficiary and Family-Centered Care Quality Improvement Organizations will gather information for educational purposes only and will not refer inpatient claims for procedures recently removed from the inpatient-only list for site-of-service for RAC reviews. Because inpatient-only procedures generally must be performed on an inpatient basis, regardless of whether the physician expects the patient to meet the 2-midnight benchmark, many hospitals have policies to ensure that inpatient orders are obtained for these procedures.

When a procedure is removed from the inpatient-only list, hospitals sometimes struggle to unwind embedded or even automated processes and reeducate staff before the January 1 effective date. CMS believes that creating a two-year grace period will give hospitals enough time to update policies and educate staff and patients.

Effective January 1, 2020, the following CPT® codes will be removed from the inpatient-only list:

  • 27130, arthroplasty, acetabular and proximal femoral prosthetic replacement (total hip arthroplasty) with or without autograft or allograft
  • 22633, arthrodesis, combined posterior or posterolateral technique with posterior interbody technique including laminectomy and/ or discectomy sufficient to prepare interspace (other than for decompression), single interspace and segment; lumbar
  • 22634, …; lumbar; each additional interspace and segment
  • 63265, laminectomy for excision or evacuation of intraspinal lesion other than neoplasm, extradural; cervical
  • 63266, …; thoracic
  • 63267, …; lumbar
  • 63268, …; sacral
  • 00670, anesthesia for extensive spine and spinal cord procedures (for example, spinal instrumentation or vascular procedures)
  • 00802, anesthesia for procedures on lower anterior abdominal wall; panniculectomy
  • 00865, anesthesia for extraperitoneal procedures in lower abdomen, including urinary tract; radial prostatectomy (suprapubic, retropubic)00944, anesthesia for vaginal procedures (including biopsy of labia, vagina, cervix or endometrium); vaginal hysterectomy
  • 01214, anesthesia for open procedures involving hip joint; total hip arthroplasty

Procedures removed from the inpatient-only list are not prohibited from being performed on an inpatient basis but do become subject to the 2-midnight rule. Although organizations will have a two-year grace period from audits and denials for the procedures removed from the list in 2020, they must still adjust internal policies to allow these procedures to be performed on either an inpatient or an outpatient basis.