Appeal by Midnight, or Else – Patient Waver of Liability

One Quality Improvement Organization (QIO) gave the wrong information, costing a hospital thousands of dollars.

First, let me thank all of you who have been submitting comments to the Centers for Medicare & Medicaid Services (CMS) on its proposed rule to rein in Medicare Advantage (MA) plan abuses. I have been reading many of the comments, and they are great. It was also great to see many comments from beneficiaries themselves about how MA plans affected them.

Here is my favorite comment so far: “Dear Government, you need to stop trying to interfere with the rights of us seniors!! Use that money you took from us for years and protect us and stop trying to take away the rights we have earned!!!”

You still have a few more days to comment, and to tell the story of the effects on your patients. The link to submit your comment by Feb. 13 is here.

Moving on, I received a question last week about the rights of patients to appeal their discharge. As you likely know, every Medicare inpatient gets that Hospital-Issued Notice of Non-Compliance (HINN), outlining their appeal rights. And it seems that more and more patients are taking advantage of the opportunity. In data from 2019, we know one of the two quality improvement organizations (QIOs) received more than 5,000 discharge appeals, and that approximately 89 percent of those appeals were ruled in favor of the hospital.

But here is the tricky part. To take advantage of all protections provided to the patient during the appeal process, the patient must appeal by midnight on the day they were informed of their discharge. They are certainly welcome to appeal after midnight, but they do not keep all their protections.

As most of us know, if the patient files a timely appeal and loses, they can stay until noon on the day after the decision is conveyed by the QIO before they start owing money. But if they don’t appeal by midnight, they have no such waiver of liability. Their appeal is considered untimely. Not only does that give the QIO an extra day to make a determination, with two days to convey their opinion to the patient and hospital instead of noon the day after they receive records, but if you present an HINN before midnight and they do not appeal by midnight, you can start charging the patient as of 12:01 a.m.

How do you operationalize this? Well, other than asking someone to stay and wait until midnight to see if the patient calls the QIO, you can wait until the end of the workday – and if the patient has not yet called, give them the HINN. Inform them that it notifies them that they are financially liable as of midnight unless they either agree to discharge or call the QIO by midnight. If they end up appealing prior to midnight (and yes, the QIO takes calls 24/7), the HINN will be invalid. If the patient does not call the QIO at all or calls after midnight, their liability begins, but only if they received a properly completed HINN. That means you can send in the finance folks in the morning to start making payment arrangements, being sure to tell them that if they win their appeal, you will refund any money they have already paid.

Now, what if they received the HINN, do not appeal, and the next morning agree to leave? That’s your call. You can charge the patient, or you always have the option to bill that day as provider-liable by using the proper occurrence span code – but that is a decision someone in charge should be making. Remember, that one extra night used expensive hospital resources and kept another patient from occupying that bed.

It is also worth noting that notification to the patient that they are ready to discharge, but are not leaving, should also include a conversation with the physician about the patient’s medication and care orders. If they are stable enough to be discharged, the orders for as-needed IV medications, IV fluids, medications, and labs and imaging should be cancelled. After all, they would not be getting these services at home.

Now, back to the questioner’s case. What was this person told? Well, when the QIO called with their decision, they were told that no matter when the patient appeals, they have liability protection until noon the day after the QIO determination is delivered. And she noted that the QIO even told that to the patient.

That’s completely wrong.

I am the first to admit this is confusing, and of course, the Medicare manuals are never easy to read, but I certainly expect the QIO to provide proper information. She did not want me to release her name or institution (or even the QIO that did this), but I am hoping that both QIOs read this and go back and retrain their staff to follow CMS guidelines.

We do not have the choice to modify the regulations as we see fit, so neither should they.