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dmcleanThe case management department in every hospital plays a pivotal role in RAC readiness.


Managing your front door means making good patient status decisions before the patient arrives, as the patient arrives or as a patient’s clinical condition becomes clearer or changes. It also means managing status seven days a week. The days of playing catch-up on Monday for patients arriving Friday or Saturday are (or should be) over.


Here is a step-by-step process to help you manage your front door:


Step 1: Know the statuses and how to apply them at each portal of entry for every patient placed in a bed.


What are the bed placement statuses recognized by Medicare?




1. The patient meets the specific criteria established in the Utilization Review Plan (for example InterQual/Milliman or facility-developed criteria);

2. The patient passes second-level physician review as being appropriate for inpatient admission; or

3. The patient is having a procedure performed that appears on Medicare’s “inpatient only” list.




Routine outpatient surgical scenarios include:


1. Patients requiring dialysis due to access failure (or missed treatment time), outpatient blood transfusions and chemotherapy. While it is common to provide this type of care in a bed, the patient status is still outpatient. A patient in a bed does not necessarily an inpatient make.

2. Outpatient extended recovery: those patients in a bed beyond the typical 4-6 hour post-op recovery period may stay overnight (but this is not observation)

3. Outpatient with observation services: Always an unplanned or emergency event, this status is most properly used for patients arriving via the ED or as direct referrals from an outpatient setting. Observation is never a planned or timed event. Never use observation services immediately post-procedure or post-operatively; only use them more than six hours after a procedure or operation for patients with an unforeseen emergent condition. Always monitor every observation service patient closely for discharge or transition to inpatient status, and use second-level physician review on ambiguous cases.


Step 2: Do not use the word “admit or “admission”.


Those words really do not define clearly enough the intended status. Review each and every order prior to registration and bed placement. Assurea clear order that includes the following six specific elements: date, time, doctor, diagnosis, status and level of care. An ambiguous order is much more easily challenged by a RAC audit. The admitting or registration clerk should check orders prior to registration and the case management team should check them again to verify that the registration matches the order. Also review all standing orders for status clarity.


Step 3: Ask two case management questions.


Question one: is the ordered status correct from a criteria, second-level physician review and inpatient-only list standpoint? Question two; does the ordered status match the registration status? A correct registration matching the ordered status is crucial to the health information management (HIM), billing and coding processes. Attention to the order and registration details for every patient placed in a bed is mandatory to achieve RAC readiness and Medicare billing compliance.


Step 4: Know your portals of entry and develop strategies for each one.


Each hospital typically has several portals of entry. Most typically those points are the emergency department, direct admission from a physician office or clinic, the operating room or the recovery room, which can include patients who can be elective or emergent. Other portals include the cardiac cath lab, with patients who again may be elective or emergent, and those patients placed in beds due to a special procedure, endoscopy or interventional radiology.


More specifically: Emergency department and direct referrals – For these portals consider a nurse case manager or bed placement review nurse to apply criteria prior to placement. Work with the ED and/or attending physician to establish status. For patients placed in outpatient settings with observation services, case management should review in the AM and manage accordingly based on patient condition and services required.



OR/PACU – For elective patients, review 100 percent of them by HCPCS/CPT code prior to scheduling or boarding of intended surgery in order to establish if the procedure is on the inpatient-only list. If the scheduled procedure is on the inpatient-only list, an inpatient order is required pre-operatively. PACU staff should alert case management staff immediately if the planned procedure is changed intra-operatively so the new HCPCS/CPT can be checked against the inpatient-only list and the appropriate order secured.


Cardiac Cath Lab – Many elective cath lab procedures are normally outpatient procedures even if the patient stays overnight. This is an area of extreme risk from a RAC perspective. Be sure to establish criteria, use second-level review when needed and review standing orders for clarity and compliance.


Interventional Radiology/Endoscopy/Special Procedures – As with the cath lab, most elective procedures are outpatient and those patients placed in a bed should be reviewed by case management to help the physician establish the correct status. Again, check standing orders for status clarity and compliance.


In summary, be sure to understand each status, secure a complete order prior to registration, double-check the status and assure that the status and registration match every morning, seven days a week. Also be sure to develop a strategic case management plan for each portal of entry. A strong front-door status management program is invaluable for Medicare short-stay medical necessity RAC audit readiness.


About the Author


Donna McLean, RN, MBA, CMAC, is president and co-founder of DSE Associates – Healthcare Case Management Solutions. Donna’s 25 years of firsthand experience in providing healthcare services qualifies her to understand the needs and requirements of clients in the healthcare arena.


Contact the Author




To comment on this article please go to editor@racmonitor.com


Modifier 59: The  Devil is in the Details, Part 1


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